[Senate Hearing 106-390]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 106-390
 
AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

=======================================================================

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                                   on

                           H.R. 1906/S. 1233

 AN ACT MAKING APPROPRIATIONS FOR AGRICULTURE, RURAL DEVELOPMENT, FOOD 
 AND DRUG ADMINISTRATION, AND RELATED AGENCIES PROGRAMS FOR THE FISCAL 
         YEAR ENDING SEPTEMBER 30, 2000, AND FOR OTHER PURPOSES

                               __________

               Centers for Disease Control and Prevention
                       Department of Agriculture
                      Food and Drug Administration
                       Nondepartmental witnesses

                               __________

         Printed for the use of the Committee on Appropriations


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate

                                 ______



                    U.S. GOVERNMENT PRINTING OFFICE
54-203 CC                   WASHINGTON : 1999

_______________________________________________________________________
            For sale by the U.S. Government Printing Office
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                                 20402
                           ISBN 0-16-060287-4





                      COMMITTEE ON APPROPRIATIONS

                     TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi            ROBERT C. BYRD, West Virginia
ARLEN SPECTER, Pennsylvania          DANIEL K. INOUYE, Hawaii
PETE V. DOMENICI, New Mexico         ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri        PATRICK J. LEAHY, Vermont
SLADE GORTON, Washington             FRANK R. LAUTENBERG, New Jersey
MITCH McCONNELL, Kentucky            TOM HARKIN, Iowa
CONRAD BURNS, Montana                BARBARA A. MIKULSKI, Maryland
RICHARD C. SHELBY, Alabama           HARRY REID, Nevada
JUDD GREGG, New Hampshire            HERB KOHL, Wisconsin
ROBERT F. BENNETT, Utah              PATTY MURRAY, Washington
BEN NIGHTHORSE CAMPBELL, Colorado    BYRON L. DORGAN, North Dakota
LARRY CRAIG, Idaho                   DIANNE FEINSTEIN, California
KAY BAILEY HUTCHISON, Texas          RICHARD J. DURBIN, Illinois
JON KYL, Arizona
                   Steven J. Cortese, Staff Director
                 Lisa Sutherland, Deputy Staff Director
               James H. English, Minority Staff Director
                                 ------                                

  Subcommittee on Agriculture, Rural Development, and Related Agencies

                  THAD COCHRAN, Mississippi, Chairman
ARLEN SPECTER, Pennsylvania          HERB KOHL, Wisconsin
CHRISTOPHER S. BOND, Missouri        TOM HARKIN, Iowa
SLADE GORTON, Washington             BYRON L. DORGAN, North Dakota
MITCH McCONNELL, Kentucky            DIANNE FEINSTEIN, California
CONRAD BURNS, Montana                RICHARD J. DURBIN, Illinois
TED STEVENS, Alaska
  (ex officio)
                           Professional Staff

                           Rebecca M. Davies
                        Martha Scott Poindexter
                              Hunt Shipman
                       Galen Fountain (Minority)

                         Administrative Support

                               Les Spivey
                       Carole Geagley (Minority)




                            C O N T E N T S

                              ----------                              

                       Tuesday, February 9, 1999

                                                                   Page
Department of Agriculture: Office of the Secretary...............     1

                         Tuesday, March 2, 1999

Department of Agriculture: Under Secretary for Farm and Foreign 
  Agricultural Services..........................................   123

                        Tuesday, March 16, 1999

Department of Health and Human Services: Centers for Disease 
  Control and Prevention.........................................   315
Department of Health and Human Services: Food and Drug 
  Administration.................................................   325
Department of Agriculture: Office of the Under Secretary for Food 
  Safety.........................................................   517

                        Tuesday, April 27, 1999

Department of Agriculture........................................   553
Department of Health and Human Services: Food and Drug 
  Administration.................................................   617

    Material Submitted by Agencies Not Appearing for Formal Hearings

Department of Agriculture:
    Alternative Agriculture Research and Commercialization 
      Corporation (AARCC)........................................   707
    Cooperative State Research, Education, and Extension Service.   709
    Departmental Administration..................................   712
    Economic Research Service....................................   714
    National Appeals Division....................................   718
    Office of the Chief Economist................................   719
    Office of the Chief Financial Officer........................   725
    Office of the Chief Information Officer......................   728
    Office of Civil Rights.......................................   737
    Office of Communications.....................................   739
    Office of the General Counsel................................   740
    Office of Inspector General..................................   750
    Office of the Under Secretary for Research, Education, and 
      Economics..................................................   760
    Rural Business-Cooperative Service...........................   766
    Office of the Secretary for Rural Economic and Community 
      Develop- 
      ment.......................................................   768
    Rural Housing Service........................................   774
    Rural Utilities Service......................................   779
    Departmental Administration..................................   784
    Office of Chief Information Officer..........................   789
    National Agricultural Statistics Service.....................   820
    Economic Research Service....................................   821
    Animal and Plant Health Inspection Service...................   837
    Agricultural Marketing Service...............................   848
    Grain Inspection, Packers, and Stockyard Administration......   852
    Agricultural Research Service................................   860
    Research Activities..........................................   947
    Farm Credit Administration...................................   980
    Research, Education, and Economics...........................   983
    Federal Administration and Special Research Grants...........   991
Submitted Questions on Government Performance and Results Act:
    Alternative Agricultural Research and Commercialization 
      Corporation................................................  1181
    Agricultural Marketing Service...............................  1182
    Agricultural Research Service................................  1183
    Animal and Plant Health Inspection Service...................  1185
    Cooperative State Research, Education, and Extension Service.  1187
    Departmental Administration..................................  1189
    Economic Research Service....................................  1190
    Foreign Agricultural Service.................................  1192
    Farm Service Agency..........................................  1194
    Food Safety and Inspection Service...........................  1197
    Grain Inspection, Packers and Stockyard Administration.......  1200
    National Agricultural Statistics Service.....................  1201
    National Appeals Division....................................  1203
    Natural Resource Conservation Service........................  1204
    Office of Budget and Program Analysis........................  1207
    Office of Communications.....................................  1208
    Office of the Chief Economist................................  1210
    Office of the Chief Financial Officer........................  1211
    Office of Chief Information Officer..........................  1213
    Office of the General Counsel................................  1214
    Office of the Inspector General..............................  1215
    Rural Development............................................  1217
    Risk Management Agency.......................................  1219
Nondepartmental Witnesses........................................  1223


AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

                              ----------                              


                       TUESDAY, FEBRUARY 9, 1999

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Thad Cochran (chairman) presiding.
    Present: Senators Cochran, Bond, Burns, Kohl, Harkin, 
Dorgan, Feinstein, and Durbin.

                       DEPARTMENT OF AGRICULTURE

                        Office of the Secretary

STATEMENT OF DAN GLICKMAN, SECRETARY
ACCOMPANIED BY:
        RICHARD ROMINGER, DEPUTY SECRETARY
        KEITH COLLINS, CHIEF ECONOMIST
        STEPHEN B. DEWHURST, BUDGET OFFICER

                            OPENING REMARKS

    Senator Cochran. The subcommittee will please come to 
order.
    Today we begin the hearings on the fiscal year 2000 budget 
submitted by the President for agriculture, rural development, 
and related agencies.
    We are very pleased this morning to have as our first 
witness the Secretary of Agriculture, Mr. Dan Glickman. We 
appreciate, Mr. Secretary, your being here with us today and 
having those who are accompanying you: Richard Rominger, Deputy 
Secretary of the Department of Agriculture; Keith Collins, the 
Department's Chief Economist; and Stephen Dewhurst, the Budget 
Officer of the Department.
    This subcommittee has jurisdiction for all appropriations, 
programs, and activities of the Department of Agriculture, with 
the exception of the Forest Service which is funded by the 
Interior appropriations bill.
    The President's fiscal year 2000 appropriations request, 
which is before the committee this morning, is $60.6 billion, a 
net increase of $5.8 billion from the fiscal year 1999 enacted 
level. This excludes the $5.9 billion in emergency spending for 
USDA programs provided by the fiscal year 1999 Omnibus 
Appropriations Act.
    Over three-fourths of the total fiscal year 2000 budget 
request, a total of $47 billion, is for appropriations that are 
mandated by law. So, the President's total fiscal year 2000 
discretionary appropriations request is $13.2 billion, an 
increase of $275 million from the fiscal year 1999 level.
    The total request is actually understated if you extract 
savings from legislative proposals and questionable scoring 
tactics. The budget request relies, for example, on the 
adoption of new user fee legislation to generate an additional 
$532 million in collections for fiscal year 2000. These same 
user fee proposals, such as user fees to cover the costs of 
meat, poultry, and egg product inspections, have been rejected 
by previous Congresses, and I suspect that will be the case 
again.
    While the appropriations request of the affected agencies 
does not reflect the savings from these fee proposals, the 
savings, nonetheless, are taken from our bottom line. They're 
used in the President's budget as offsets to comply with the 
Balanced Budget and Emergency Deficit Control Act caps on 
discretionary appropriations.
    Furthermore, not only does the budget propose to redirect 
funds from ongoing programs and activities to fund program 
increases and new requirements, the appropriations request 
relies on additional savings from legislative proposals to 
shift programs to the mandatory side of the ledger, to save 
$200 million by funding fiscal year 2000 rural rental 
assistance requirements over 2 years, and to double count $180 
million in savings used to offset fiscal year 1999 
appropriations.
    I believe it is fair to say that this subcommittee will not 
have the luxury of being able to count on the availability of 
this savings or approve many of the proposed shifts in funds 
from existing priorities of the Congress. The reality, Mr. 
Secretary, is that we will have to operate under more 
constrained spending limitations than those in this budget.
    We have your statement that you have prepared, Mr. 
Secretary, and we will make it a part of the record in full. We 
encourage you to proceed to summarize it and make whatever 
additional comments you think would be helpful to the 
subcommittee, and then we will have an opportunity for 
questions from the subcommittee members.
    But before hearing your comments, let me yield to the 
distinguished Senator from Wisconsin, the ranking minority 
member of this subcommittee, whom we welcome in this new 
capacity. He has been a member of the subcommittee and has been 
a very effective and helpful member in our deliberations. 
Senator Kohl.

                       STATEMENT OF SENATOR KOHL

    Senator Kohl. Thank you, Senator Cochran. It is a great 
pleasure for me to join you this morning in welcoming Secretary 
Glickman, Secretary Rominger, and our other distinguished 
guests from the Department of Agriculture.
    Mr. Chairman, let say that I look forward to working with 
you and all of the members of the subcommittee this year to 
develop the fiscal year 2000 appropriations bill for the 
Department of Agriculture, the Food and Drug Administration, 
and the other agencies under this subcommittee's jurisdiction.
    It is also a pleasure to see you and we look forward to 
hearing your remarks, Mr. Secretary, regarding the USDA budget 
for the coming year. Programs administered by the Department of 
Agriculture touch all of our lives in many ways. In Wisconsin 
and across the Nation, farmers, school children, and consumers 
from every walk of life rely on your Department for a wide 
variety of services ranging from commodities produced on farms 
to the commodities served at the dinner table. Rural 
communities have come to rely on programs of USDA to meet 
housing, utility, and economic needs. The conservation programs 
at USDA serve to help us protect our soil, water, and wildlife 
resources not only to improve our own quality of life, but the 
quality of life of our children and our grandchildren.
    U.S. agriculture today faces many challenges. Market prices 
continue their volatility and there is no guarantee that the 
dairy prices of today will be the dairy prices of tomorrow. I, 
in fact, remain very concerned that the problems facing dairy 
farmers rest beyond the markets and in part with USDA dairy 
programs themselves, such as regional dairy compacts.
    One of these programs, the milk pricing laws, for example, 
has created an unfortunate cast of winners and losers, with 
family farmers having the most at stake. Federal milk marketing 
orders must demand equity and simplicity as necessary tools to 
eliminate the inherent inefficiencies and unfairness of 
arbitrary regional differences. Without reform, Wisconsin will 
lose half of our family dairy farmers over the next 5 to 10 
years, which of course to me and I am sure to you is an 
unacceptable result of a totally failed policy.
    The face of agriculture is changing as we witness the 
challenge of large corporate interests competing with the 
sustainability of small, independent, family-size operations. 
American consumers have grown accustom to available and 
affordable food items that previous generations could not even 
imagine. When Wisconsin pioneers sat down to eat their evening 
meal, they had no concept whatever of E. coli, Salmonella, and 
any other cause for foodborne illness. They took their chances, 
but today we rely on USDA to provide not only the most 
bountiful food supply in the world, but also the safest.
    So, Mr. Secretary, we are glad to have you here today. We 
look forward to your remarks, and we have a few questions to 
ask after you make your remarks.
    Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator.
    Senator Bond.

                       STATEMENT OF SENATOR BOND

    Senator Bond. Thank you, Mr. Chairman. I will be very 
brief.
    I want to join you in welcoming Senator Kohl as the ranking 
member. I know he will be great in the leadership team.
    But most of all, Mr. Chairman, I begin by commending you 
for your knowledge, your dedication, and your hard work on this 
committee. You really are the most effective chairman of any of 
the appropriations subcommittees. I say that as an admission 
against interest. [Laughter.]
    And your knowledgeable explanation of the budget 
shenanigans that we have to deal with in this committee and 
others is very important because we are not going to be making 
these savings or shifts. So, we have a tough job to do in this 
subcommittee.
    As I mentioned to the Secretary, as I was coming in, there 
are some real crises. I have got some cattle producers back 
home who wonder if it is going to take Patton's 3rd Army to 
liberate Europe so Europeans can eat U.S. beef. The Europeans 
have not had a good steak in 10 years. [Laughter.]
    Senator Baucus and I have finalized the letter to you, Mr. 
Secretary, and I think we have about 41 Senators on it, asking 
you that you begin now to be ready to retaliate if the May 13th 
deadline is not met. I know you have watched, as we have. They 
find lots of ways to diddle and dawdle and refuse to take the 
steps they need to, and I hope that you are ready on May 13th 
or May 14th to pull the trigger and move ahead.
    Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator.
    Senator Burns.

                       STATEMENT OF SENATOR BURNS

    Senator Burns. Thank you, Mr. Chairman. I will just submit 
a statement, and I want to hear from our witnesses today.
    I think as you look at this budget and look at the 
appropriations as requested by the Secretary of Agriculture--
and we want to welcome him this morning. I have got a whole 
litany of things here. I will get them to you. You will spend 
the rest of the day musing over them.
    But I think in my opinion the discretionary funds that the 
chairman has talked about this morning--there is nothing wrong 
on the farm or ranch today excepting the price. I think that 
was noted in a hearing held in the Agriculture Committee. Out 
of that emanated what Senator Bond and Senator Baucus are 
trying to do.
    But here is the challenge ahead of us. Auburn University 
Professor C. Robert Taylor noted that farmers are making 4.5 
percent return on their equity in the 1990's, while retail food 
chains are raking in 18 percent; food manufacturers, 17.2 
percent; even agricultural banks at 10.8 percent. The price 
consumers paid for food has risen 2.8 percent since 1984, while 
prices paid to farmers has declined 35.7 percent. Retailers' 
marketing costs have tumbled some 14.9 percent. And then you 
wonder why we have got a problem on the farm.
    I do not know what we are going to spend our money for, but 
I think we should be looking at this problem right here. We 
keep talking about this great and wonderful exploding economy, 
and if you want to go through farm country and look at the 
auctions, they ain't going out of business because they want 
to. And this is the problem. This is the problem.

                           PREPARED STATEMENT

    So, instead of doing all of this stuff that does not mean 
anything, we had better start concentrating and spending that 
money and getting some people down there that are advocates for 
the producers so that we can increase that percentage of the 
consumer dollar getting back to the people who actually produce 
it. That is our challenge, and I think that is the direction in 
which we are going to have to proceed.
    Thank you, Mr. Chairman.
    [The statement follows:]

                  Prepared Statement of Senator Burns

    Thank you, Mr. Chairman.
    I would like to thank the Chairman for the prompt and 
timely manner in which he has called the first hearing on the 
fiscal year 2000 budget for Agriculture, Rural Development and 
Related Agencies. I think it is extremely important to get the 
ball rolling early this year so that we can have a timely and 
effective process for this Subcommittee. I would also like to 
acknowledge the presence of Senator Kohl as ranking member of 
the Subcommittee this year. I look forward to working with you 
both, as well as all the members of the Subcommittee this year 
for the benefit of the greatest agriculture producers in the 
world--the American farmer and rancher.
    Well enough of the niceties, it is time to get down to the 
business at hand, a discussion of the budget proposal put forth 
by the Administration for the Department of Agriculture. I was 
hoping after what we all had to go through last year in this 
hearing room with Secretary Glickman, that this year we would 
have seen some improvement in the budget proposal put forth 
this year. But I guess I was expecting too much.
    A year ago I questioned whether there was an advocate for 
the producer in the Department of Agriculture, and as I looked 
through the budget for the coming year I have found that I no 
longer need to ask, the answer is clear. NO, there is not an 
advocate in the Department for the producer. Questions and 
issues that clearly could have been addressed were left out in 
the cold. A solution which would have benefited the man and 
woman in the field was left unaddressed, as in the case of 
serious crop insurance reform.
    Mr. Secretary in my mind that one issue is just the very 
tip of the iceberg which I am afraid is about to puncture the 
hull of the good ship USDA. The people in their tractors and on 
horseback in Montana no longer have faith in the Department to 
assist them in any way which will help them move their products 
in the market place, or in finding realistic and meaningful 
ways to increase the certainty of their future.
    So many of the actions that this Administration and the 
people within your Department have taken in Montana have placed 
additional burdens on these hard working citizens. Although not 
related to this budget, just last week the Chief of the Forest 
Service went to Montana to remove over 400,000 acres of land 
from any future mineral exploration. Although I have not yet 
decided if mining in this area is the best thing to do at this 
time, I am sure that if you close it for 20 years, as the Chief 
has determined, we will not get in there at anytime to do 
anything which will assist the people of the state of Montana. 
Close it for 20 years and you close it forever, no matter what 
sound and scientific technology may be developed for the 
extraction of the minerals in this area.
    Mr. Secretary, it started with timber, then oil and gas, 
now minerals. What is next Mr. Secretary? I can already see the 
attack on the recreationalists and those people that graze 
cattle on these lands. Although these are public lands and many 
special interest groups will argue that these natural resource 
providers have no rights to these lands, these same people must 
remember that people who make their living off the land are 
also citizens of this nation.
    Let me get back to the topic at hand however, issues that 
are directly related to agriculture production. Last year this 
committee appropriated a set sum of funds to provide for the 
Department to settle certain lawsuits as a result of 
discrimination. I am in favor of assisting anybody who has been 
unjustly treated due to their race, religion or sex. However, 
it seems that we may have a problem resolving all these 
problems.
    I want to commend the USDA, Office of Civil Rights, for 
their recent action to settle the discrimination suit brought 
by African-American farmers against the USDA. However, I firmly 
believe that much remains to be done. According to information 
posted on the Office of Civil Rights Internet site as of March 
1998, Montana had at least 19 cases of discrimination pending 
with the USDA, placing Montana in the same category as highly 
populated states such as Florida and New York.
    One young woman has a case that has been awaiting decision 
at various levels of appeal since 1995. She cannot make good 
management decisions or create viable farm plans until this 
situation is resolved. The stress of this wait has caused 
serious medical problems. In another case, a farm family has 
lost everything except their dignity. Now, they wait in a 
rented house to find out what their future will hold.
    These people deserve better than this from an agency that 
was supposedly established to help American agricultural 
producers. I want to know when the people still in the process 
can expect prompt, responsive, and efficient handling of their 
complaints, not the foot- dragging, hurry-up-and-wait treatment 
they have received up to this point?
    As I looked at the budget for the Department, at least two 
very striking areas arose in my mind. I can tell you that 
numerous other issues came up, but none quite as striking as 
the amount of dollars I see being expended in terms of research 
and in the area of the Foreign Agriculture Service.
    In terms of research I cannot believe that we are content 
with what is being done today to assist our producers. It 
appears to me that we are doing a great deal to assist those 
people in the next couple of layers in getting the product 
safely to the consumer. These next couple of layers are the 
people that can afford to expend the dollars to assist their 
enterprises. But the producer who is out there working in the 
field cannot find the assistance from this Department to make 
them better producers.
    Mr. Secretary, the biggest problem we have right now in the 
world of agriculture is getting a fair share of the consumer 
dollar back to the producer. Somewhere between the time the 
producer sells the product and the time it reaches the table, 
there is a serious disconnect. I've talked to the man and woman 
on the ground, the processor and all the way to the grocers. 
Now according to these people not one of them is making any 
money in the food production business. So can somebody tell me 
why I spend three times as much for a pound of Wheaties as the 
farmer gets paid for a sixty pound bushel of wheat. And why is 
it that a rancher out there is selling his steer for $65 a 
hundred and I pay over $5 a pound for good steak. Something is 
wrong here.
    Mr. Secretary, I would like to provide you with some 
figures that came up during the recent hearing before the 
Senate Agriculture Committee. I quote Auburn professor C. 
Robert Taylor, who noted that farmers are only making a 4.5 
percent return on equity in the 90's, retail food chains 18 
percent, food processors 17.2 percent and even agriculture 
banks are getting 10.8 percent. Taylor also brought up the fact 
that the price consumers pay for food has risen 2.8 percent 
since 1984 while the prices paid to the farmer has fallen by 
35.75 and retail marketing costs have tumbled 14.9 percent.
    This is where we need to do the work, getting that dollar 
back to the producer. And it may fall on this committee to look 
at a resolution to this problem. I commit my support and my 
efforts to the Chairman and ranking member as well as to the 
producer in Montana and the nation to work on this issue with 
them in the coming year.
    Part of it deals with the fact that our producers cannot 
count on the Department to assist them in securing the future. 
Research is the vision of the future, and according to this 
budget we have a limited vision of what the future is and where 
our food will come from. Mr. Secretary, you have heard this 
same speech from me for at least the past two years, and as 
long as you and your Department treat the best producers in the 
world in the manner that you do, you can count on hearing more 
and more of the same from me.
    Last year I attempted to get some funds to look to the 
future and ran into a roadblock in getting the funds for a very 
important project. As we continue to see increases in the 
interaction between livestock and wildlife we will continue to 
see problems arising related to the diseases which wildlife may 
carry which could be detrimental to livestock. We already are 
experiencing just such a problem in Montana between the bison 
and domestic livestock. Yet I could not get the backing of the 
Administration to address the issue, but instead have to look 
at this competition between established research devoted to 
contained livestock. I have to be honest with you that if we 
don't address this problem at the root cause that we will need 
the research on contained livestock. I hope to work with 
members of this committee to see what we can do to address this 
potentially dangerous problem this coming year.
    I cannot believe, that during this past year when we fought 
so hard in Congress to get the Administration to open their 
eyes to the plight of the producer in field, as they attempt to 
compete on world markets that you would endorse cutting the 
budget that will help us compete. The cuts are short sighted 
and do nothing to make our producers feel that the government, 
the same government they pay taxes to, is helping them in any 
way.
    I have a difficult time going back to Montana and telling 
my producers that this Administration will take care of them 
the next round of negotiations on the world trade market. They 
have heard that for too long. It appears that when our 
negotiators go the trading table they are more than willing to 
slide agriculture off the table as it is not a high ticket 
enough of an item. The balance of trade cannot reflect a closer 
balance when we trade food as compared to high ticket high 
technology. It just appears that cutting the deal is more 
important than what is contained in the deal. I know this is 
not all your doing, but Mr. Secretary by cutting the funds for 
the Foreign Agriculture Service does not send a signal that you 
are concerned. Additionally, you have a position of authority 
in this Administration and you can use your influence to make 
sure that the trade negotiators make agriculture an important 
share of our international trade.
    There appears to be at least one program out there where 
there seems to be some success in dealing on foreign markets, 
that is the Foreign Market Development Cooperators Program, yet 
the Foreign AG Service with your okay, always seems to find a 
way to cut or at least reduce the funding for this program. It 
just doesn't make sense to me.
    I have even heard rumors about the hill that the Department 
is in the process of developing language that would remove the 
statutory language in the `96 Farm bill for this program. I 
can't believe this since it is a program that is basically 
being successful in nature. I am a little proprietary in nature 
since this is language I had placed in the Farm bill four years 
ago.
    I am concerned as well with the continuing fight that seems 
to be taking place on exporting our beef to the European Union. 
I have joined with a number of Senators in sending a letter to 
you asking that you be prepared to take whatever measures are 
necessary to protect American beef from the unrealistic demands 
placed on it by our so called trading partners. We need to 
begin to use the muscle we have as a trading partner on the 
world market and bring those countries which we count on for 
trade to the table to bargain and deal in good faith.
    I also have a little problem back in Montana that I know 
you Mr. Secretary are familiar with in a very close sense. The 
bison continue to leave Yellowstone National Park, and Montana 
continues to protect its' investment in the livestock industry. 
As you are aware I have always been a strong proponent of the 
Animal, Plant Health Inspection Service (APHIS) and I continue 
to strongly support their efforts in terms of keeping America 
clean from biological agents from outside our borders, but in 
terms of the work and effort that they have put into the bison 
problem I am having my doubts, as is much of Montana. More 
times than not, it appears that they are no longer working with 
us but instead they seem to appear to have lost sense of their 
mission statement in terms of animal health.
    I have taken more than enough time today to discuss my 
displeasure both in this Administration and the manner in which 
the Department is responding to the needs of producers. I am 
sure I will hear the standard answers that I have heard for the 
past nine years, but rest assured that I am not going to sit by 
and watch the producers in Montana and this country be taken 
advantage of any longer. Thank you again Mr. Chairman, I look 
forward to hearing from the Secretary, and more importantly 
working with you in the coming year for American agriculture.

    Senator Cochran. Thank you, Senator Burns.
    Senator Durbin.

                      STATEMENT OF SENATOR DURBIN

    Senator Durbin. Thank you, Mr. Chairman. It is a pleasure 
to be a member of this subcommittee. It was my honor to serve 
for 12 years in the House of Representatives as a member of 
this same subcommittee, going back to the days of Jamie 
Whitten, who was my teacher in the art of appropriations.
    I also recognize the team at the table here. Though I have 
been gone for 2 years, they clearly are still at their posts 
and doing their job. Secretary Glickman, thank you for coming. 
Mr. Rominger, good to see you again. Mr. Collins, as always I 
am sure you will present us with some valuable economic 
information based on your research. And the long-suffering 
Steve Dewhurst, who has been the Budget Officer for as long as 
I can remember, welcome. [Laughter.]
    Through thick and thin and changes in Secretaries, you have 
been here, and I thank you for your contribution. I welcome you 
all and I thank you for the opportunity to be part of this 
hearing.
    I have a number of issues of interest in the proposed 
budget. I see that you have made some substantial cutbacks in 
outlays, which undoubtedly will be visited on many different 
aspects of this budget. I am concerned about some of the 
decreases in the ARS construction account, particularly as it 
affects my home State of Illinois in Peoria, as well as in 
Champaign-Urbana. I will be submitting some questions on 
specific elements there.
    I would like to, if I can, focus on one thing in 
particular, and I would hope, Mr. Secretary, that you would 
reflect on this as well. We are now near the close of the 
Clinton administration with 2 years left, and many will want to 
leave a legacy in this Department of the kind of foresight and 
vision that really will be an inspiration to future 
generations. The one issue that has been investigated and 
scrutinized at great length for a great period of time is the 
whole question of food safety.
    If you look back to Government Affairs hearings in the 
1970's, hearings that were attended by Senator Percy of 
Illinois and others, they talked about the fact that we could 
not rationalize the fact that so many different Federal 
agencies were in the food safety inspection business. Some 
estimate that today there are as many as 12 different Federal 
agencies in that business, 6 major agencies, some 35 different 
pieces of legislation.
    I believe that we are captives of politics at the 
congressional level. We are captives of the businesses who are 
loathe to see change which they're uncertain of. We are 
captives of the unions who have the same fear. And frankly, we 
have to do something.
    I have worked on legislation in the last session, and I 
would like to invite my colleagues to join me this year to try 
to come together with one unified, independent food safety 
inspection agency that is guided by science, rather than 
politics, that can restore any doubt in the mind of the 
American consumer that we are doing everything in our power.
    Now, I know HACCP has brought us a long way, and I 
congratulate you for that. But let us take the next step. Let 
us bring this all under one roof. Let us not be afraid of a 
turf battle here and really dedicate ourselves in the next 2 
years to address it.
    I want to also say that I am sorry to see user fees in this 
budget again. Every year the budget folks put this in with the 
full knowledge that it will never take place. They count the 
money and then we have to try to rationalize making up the 
difference. It has just become a ritual, and unfortunately it 
is a painful one.
    I know other Senators, including Senator Kohl, have 
addressed the problems in the pork industry. I hope that we can 
find a way to look at the point raised by Senator Burns earlier 
that the producers many times are the losers. It seems that the 
concentration of power in processing and marketing has really 
created some serious problems for those who are struggling to 
be good producers and ranchers across America.
    Finally, a very parochial thing. Thank you, Mr. Secretary 
for coming to Chicago last year. When I mention this, most 
people are going to chuckle, but we have got a little problem 
that is turning into a big problem. Somehow or another a pest 
known as the Asian long-horned beetle has arrived in Chicago, 
and it is eating up our trees right and left. We are not quite 
sure where it came from, but it is a serious threat. And we are 
now chopping down trees in every direction. It will take years 
for us to replace them. Thank you to the Department of 
Agriculture for their interest in this, and I hope we can 
continue to work on that.
    Mr. Chairman, thank you for allowing me to make an opening 
statement.
    Senator Cochran. Thank you, Senator Durbin. Thank you.
    Senator Feinstein, we welcome you to the committee and 
appreciate your attendance at this hearing. We have all made 
opening comments welcoming the Secretary, and I will recognize 
you now for that purpose.

                     STATEMENT OF SENATOR FEINSTEIN

    Senator Feinstein. Well, thank you very much, Mr. Chairman. 
I am delighted to be a member of this committee. I guess I am 
the freshman on the committee. But because California has by 
far the largest agricultural industry in the United States, it 
is a very important one to us, so I am delighted to be here.
    I want, in particular, to thank Secretary Glickman for his 
response to the citrus freeze in California. The damage to that 
crop is to date more than $650 million, and that includes about 
$458 million to the orange crop and about $101 million to the 
lemon crop. I want to just thank you very much for declaring an 
emergency as promptly as you did in the six counties in which 
you did, and I want you to know that that is well respected in 
California.
    The wipe-out, where it took place, is all but total and the 
real problem remaining is also one for the workers who do not 
have additional jobs, at least for the first 6 months of this 
year. So, any help that can be given with respect to food 
stamps and those kinds of things is very, very much 
appreciated.
    I have asked the administration to help provide some 
temporary housing and unemployment assistance, as well as some 
individual and family grants to those who have lost their jobs. 
I would hope that in your remarks you might be able to respond 
to that and let us know--I think I put that in writing to you 
as well--what might be able to be done in that regard.
    I want to quickly--I did not mean to interrupt you----
    Secretary Glickman. No. We were asking about food stamps.
    Senator Feinstein [continuing]. Mr. Secretary, I bring to 
your attention the growing concern about USDA inspections at 
the United States-Mexico border. I know you just recently held 
some hearings with respect to the importation of Argentinean 
crops into California and the very real concern about pest 
controls. I would have to say that the phytosanitary controls 
are really one of the major concerns about California 
agriculture. As you know, we went through a period of the med 
fly in California and we saw that sufficiently deter exports 
into other countries. That is now under control.
    I feel very, very strongly that controls have to be in 
play. We are a huge exporting State now of agricultural 
produce. I mean, it is enormous, and if we are going to begin 
importing, we have all got to play by the same rules. What is 
sauce for the goose is sauce for the gander. And if we have 
these tight controls in our country, they also have to exist 
for crops coming into our country.
    I have been told by California agriculture that there is a 
serious need for more USDA inspectors at the border to do the 
inspections and to safeguard California's ag industry from the 
exotic fruit fly pests. I am told that the number of inspectors 
at the Otay Mesa, San Ysidro, and Tecate ports of entry is 
about one-third of what is recommended by agency guidelines.
    Recent infestations in San Diego, in Orange County, and Los 
Angeles have really heightened concerns about the need for 
additional resources at the border. Since last summer, a 70-
square-mile area of San Diego County has been under quarantine 
because of a Mexican fruit fly infestation, and the impact of 
these quarantines are now being felt. Australia and Taiwan have 
banned export to their countries for the affected crops, not 
only for the quarantine area but also a 50-mile buffer zone 
around the area.
    Now, I note that the administration's budget funds a $6 
million increase in the ag quarantine inspection program, and I 
am very hopeful, Mr. Chairman and Mr. Secretary, that this can 
be addressed, and at the appropriate time, I would like to ask 
the distinguished Secretary for a response to this problem and 
see if some of that cannot go to quell what is a burgeoning 
problem in California.
    Senator Cochran. Thank you, Senator Feinstein.
    Mr. Secretary, we welcome you again and invite you to 
proceed.

                       STATEMENT OF DAN GLICKMAN

    Secretary Glickman. Thank you very much. It is an honor to 
be here with all of you who I have known well, and particularly 
my friend, Dick Durbin, with whom I served in the House for so 
many years. Thad, I thank you very much for having me here.
    I again want to introduce Rich Rominger from California, 
our Deputy Secretary. He has been here many times. Keith 
Collins, our Chief Economist, and as Mr. Durbin pointed out, 
our venerable Budget Officer, Steve Dewhurst. We believe that 
we have the premier budget officer in the entire Government, 
and we are delighted that he is here.
    I would like to summarize my statement and request that the 
entire statement be made part of the record.
    There is an interesting dichotomy between the strongest 
general economy in a generation and the farm economy. You have 
heard it all, from low interest rates, low unemployment, 
highest home ownership, lowest inflation, highest job creation. 
I mean, it is extraordinary--since the Second World War. So, we 
see generally speaking things doing well in the general 
economy.
    Then you look not only at the farm economy but to some 
extent, you look at the natural resource economy. It is not 
just production agriculture, but it is energy, it is minerals, 
it is the production type of things that go into building 
things and making things, and these areas are not so great.
    It reminds me of a story. Senator Burns is not here, but it 
is a story about a man and his young son going up Constitution 
Avenue, and the father wants to buy his son a hotdog. So, he 
goes down the street and he sees the vendor, and the vendor is 
selling hotdogs and he says, get your hotdogs here: one end 
soybeans, the other end beef.
    So, the boy says to the vendor, I have been to a lot of 
places, but I have never seen a hot dog that is one end 
soybeans and the other end beef. And the vendor says, well, 
these are tough times, and when you have tough times like this, 
it is hard to make both ends meat. [Laughter.]
    The fact is that there are those tough times, although 
soybeans are not a bad thing, right, Mr. Durbin? [Laughter.]

                              FARM ECONOMY

    The fact is that the farm economy is under stress. Exports 
are down about $9 billion from the 1996 peak to $50.5 billion 
forecast in 1999. All parts of the economy are affected by 
this. California, being the largest exporting State, is being 
hit by it, but so are many other States. The real problem, of 
course, is Asia, the Asian markets, and the strength of the 
dollar.
    Net cash farm income is expected to be down from $59 
billion in 1998 to $55.5 billion in 1999, and that is 
notwithstanding a lot of Federal assistance that this Congress 
generously provided. Many producers have faced both low prices 
and adverse weather, which is a double hit. I see Mr. Dorgan 
has just walked in and his State has probably been hit more 
than any other.
    So, the outlook for the farm economy is not as promising as 
I would like to see.

                            FARM ASSISTANCE

    At the same time, farm assistance that this Congress has 
provided has helped. As you recall, the Congress passed, with a 
presidential push, a $6 billion emergency assistance program in 
1999, about half of that money in direct payments and the other 
half of that money in natural disaster assistance, a program 
that to some extent I think was started by our colleague from 
North Dakota in a far smaller amount that grew because of the 
fact the problem was so severe all over the country.
    We have also increased loan deficiency payments. There are 
nearly $2 billion this year. These are the payments that were 
never supposed to trigger because the prices were never 
supposed to be low enough, and now we are seeing that they have 
triggered for most of the major commodities.
    We have provided direct payment to pork producers, using an 
authority that we have not used in a very long time. It is not 
a lot of money. It is about as much money as we could find out 
of our section 32 account, and we targeted it to smaller 
producers.

                          FOOD AID INITIATIVE

    The President's food aid initiative is over 5 million 
metric tons. I just came back from Russia where we signed an 
agreement with the Russians and they are going to be purchasing 
and/or being given, under humanitarian assistance, large 
quantities of wheat and meat and other products.
    The total farm assistance provided by the Government is 
estimated to be $18 billion in 1999. So, there is no question, 
Uncle Sam, through the good efforts of this Congress, did a 
tremendous amount to keep agriculture alive, and many, many 
farmers and ranchers would be not surviving without that 
assistance.
    I will have to tell you that if prices remain at their low 
levels, the stresses will keep the workload heavy on our 
offices. We are already getting a lot of calls from Members of 
Congress about long lines at county offices. But the fact of 
the matter is that the emergency assistance, on top of the 
normal servicing requirement, has caused delays.

                         COUNTY OFFICE WORKLOAD

    The number of these LDP's I mentioned, loan deficiency 
payments, rose from 0 in 1997 to nearly 400,000 in 1998 to 
about 1.3 million in 1999, and we do not know the number for 
the year 2000 but it is probably going to be a lot. These are 
individual visits to our county offices in many cases that have 
to take place in order for farmers to get this kind of 
assistance. It is an extraordinary change in the amount of work 
that is required in every one of these offices.
    So, we are looking at our salaries and administrative 
expenses to see if there are better ways to handle this 
workload, but it is monumental. The 1996 farm bill created this 
program to put a floor on prices. It is working pretty well, 
but it requires an extensive amount of workload to keep up.
    The 1996 farm bill has some shortcomings in dealing with 
low prices and disaster related events. We are not trying to 
revise course or micromanage farmers in this appropriations 
bill, but we have a role to help farmers weather tough times 
and adjust to adverse economics. In my judgment, the 1996 farm 
bill does not work very well when prices are low. That is the 
situation we are in right now.

                            FARM SAFETY NET

    As the President said in his State of the Union address, we 
need to find a bipartisan way to improve the farm safety net by 
reforming crop insurance. Last year's emergency supplemental 
indicates that we need a long-term fix. That was a $6 billion 
program. These actions are undependable and are rather costly.
    We made a $400 million down payment as a first step to 
improving risk management by reducing the cost of farmer 
premiums for crop insurance this year by about one-third, 30 
percent. So, your farmers who are out there buying crop 
insurance this year will pay about 30 percent less for their 
premiums as part of the package that you passed last year. We 
took a bit of that money and put it in there as kind of a first 
step to encourage more people to actually buy crop insurance.
    We also issued a white paper on principles and proposals 
for crop insurance reform. That has been sent to you. In order 
to deal with how to cover crops where there are repeated crop 
disasters, multi-year disasters, new crops, all sorts of 
different circumstances, we are going to hold three regional 
forums this year on the issue of risk management. I would like 
to achieve bipartisan agreement with Congress on crop insurance 
reform this year.
    We have been criticized for not putting a specific amount 
in the budget for crop insurance, but to be honest with you, 
until we have a reasonable bipartisan understanding of what we 
want to do with the program, I did not want to provide a 
specific estimate. It could cost anywhere between several 
hundred million dollars to several billion dollars a year. I 
think we need to figure out how we are going to fix the program 
before we put the amount in the budget. But I have said, with 
the way the congress and the administration worked together to 
put $6 billion in the budget last year, if we can reach 
agreement, I believe we can find the money to appropriate the 
necessary dollars.

                              FARM CREDIT

    In the area of credit, farmers and ranchers also need 
access to adequate credit if they are to remain in business. 
This budget provides $3 billion in farm loans and guarantees, 
but with a subsidy cost of $52 million less than last year due 
to the lowest interest rates in over a generation.
    Our farm credit programs are facing an increased demand 
this year, and we will shortly be running out of money for some 
of those credit programs. We are going to have to review that 
situation for a possible fiscal year 1999 supplemental request.
    I would also say that one of our major accomplishments is 
that we are in the process of settling a major civil rights 
class action lawsuit against the Department of Agriculture, and 
we are pleased that Congress last year waived the statute of 
limitations for claims by black farmers. So, we were able to 
accomplish what I believe is one of the most profound things 
from the standpoint of justice that this Department has been 
able to accomplish for a very, very long time, and we thank you 
for your efforts there.

                              U.S. EXPORTS

    I would now like to talk about exports. The events of the 
past year have demonstrated that strong export markets are a 
critical component of the farm safety net, but they have also 
demonstrated that exports alone are not the only safety net. We 
have had market disruptions in Asia, in Latin America, in 
Russia, and elsewhere.
    We increased the programming of export credit guarantees to 
Asian markets, sales registrations were up 40 percent last 
year, and we are also taking strong efforts on the trade policy 
front. This includes exactly what you said, Senator Bond, to 
ensure that people comply with their WTO commitments based on 
sound science and based upon an international set of rules that 
everybody should be following, and also preparing for a new 
round of multilateral trade negotiations.
    This budget provides a total program level of nearly $6.5 
billion for USDA's international programs. This includes $4.5 
billion for the heart of our programs, which is CCC export 
credit guarantee program. But we will use more than that if 
necessary to keep our sales going around the world.
    But I repeat, even with all the export promotion efforts 
that we have done for many commodities, that is only part of 
the safety net, and that is why you do need some domestic 
program protection in the event that trade is not as positive 
as we would like.

                    MARKETING AND DOMESTIC PROGRAMS

    In the area of marketing, domestic marketing programs are 
also important to the economic health of U.S. agriculture. 
There are continuing concerns about market concentration, and 
we are strengthening enforcement against anticompetitive 
practices, particularly in the livestock markets. We are 
examining the hog price decline and the Cargill-Continental 
merger. We have seen concentration in other aspects of the U.S. 
economy, health care, transportation, telecommunications, but 
agricultural concentration has been I think in many cases 
particularly difficult to cope with in rural America and small 
towns where you do not have a lot of competition naturally.
    We have asked for budget increases in pest detection, 
disease prevention, and border inspections. Senator Feinstein, 
I would be glad to talk more about this particular area. I 
happen to believe that the highest priority of Government is 
protecting our own people from health and safety risks both 
from the standpoint of their own physical health and safety as 
well as economic health and safety.
    We are working on an organic certification program. We have 
asked for additional monies for the program. Organic 
agriculture is growing rapidly, and we hope to have a 
rulemaking out this year to deal with that.
    We have also asked for budget increases in the pesticide 
data program, which we desperately need as a result of the Food 
Quality Protection Act and other statutes.
    In the area of rural development, rural Americans should 
have the same opportunities for economic growth that exist in 
urban areas, and that goes for housing, running water, 
electricity, telecommunications, and job opportunities. This 
committee deserves great praise for its help in ensuring that 
water systems and sewer systems are provided all over this 
great country of ours.

                           RURAL DEVELOPMENT

    I recall, Senator Feinstein, that I visited the town of 
Orange Cove, California, which has one of the highest poverty 
rates of any community. USDA provided some assistance--and it 
is now one of our enterprise communities. This town never had 
the necessary resources. One of our prime functions is to make 
sure that towns like this get that assistance.
    The rural development budget will support almost $11 
billion in loans, loan guarantees, grants, and technical 
assistance--and that is $800 million more than last year. But, 
due to lower interest rates, the cost to taxpayers will be $400 
million lower than last year. So, this is interesting. We are 
going to be able to budget $800 million more in the rural 
development programs at a cost to the Government of $400 
million less. This is not a shell game. This is due largely to 
the fact that we have low, sustained interest rates, which 
under our budget process has made this benefit possible.
    The budget will provide $1 billion in guaranteed and direct 
loans to help rural businesses, $4.3 billion in direct and 
guaranteed loans to bring single family housing to 50,000 rural 
Americans, and a 12 percent increase in funding for the 
President's Water 2000 initiative, to help about 1 million 
rural Americans have safe drinking water.

                        RESEARCH AND FOOD SAFETY

    Research, obviously, undergirds the future of what we do in 
this Department. The budget provides an increase of nearly 10 
percent for research from the comparable 1999 level. This is 
the first substantial inflation-adjusted increase for these 
programs, whether it is research on food safety, research for 
preserving our natural resources, or research to help farmers 
be more productive. I am sure that we will provide more 
specifics on our research programs but I would like to focus on 
food safety for a moment. Senator Durbin raised this issue.
    The budget includes an additional $67 million, almost two-
thirds of a Government-wide increase of $107 million for food 
safety activities aimed at reducing microbiological 
contamination of foods. The increases are directed to the 
President's Food Safety Initiative and inspection modernization 
activities of the Food Safety and Inspection Service.
    This is the first year anniversary of HACCP implementation 
in large meat packing plants. Recent studies demonstrate there 
has been a significant reduction in the prevalence of 
Salmonella due to the implementation of HACCP--significant, in 
some cases as much as 50 percent. We are working now to bring 
the small plants in to HACCP and then, of course, the very 
small plants in to HACCP. There are different problems 
associated with each, but this budget I think will provide us 
help in dealing with that issue.
    We are also working to meet the goals of the Food Quality 
Protection Act by addressing environmental and public health 
risks associated with the use of pesticides.

                               NUTRITION

    In the area of nutrition, the budget reflects full funding 
for food stamps, child nutrition, and the WIC program. The 
budget restores food stamp eligibility to 15,000 elderly legal 
immigrants.
    And I say again to Senator Feinstein that one of the 
problems we have, of course, in dealing with the issue of a lot 
of the folks who are out of work is that because of the rules 
against providing food stamps for undocumented workers or 
illegal immigrants, our hands to some degree are tied, although 
we are working with our colleagues in other agencies on this 
point.
    Funds are also provided to improve the integrity of our 
food programs, evaluate effects of a universal free school 
breakfast pilot project and expand the WIC farmers' market 
program.

                       GLEANING AND FOOD RECOVERY

    The budget includes a new $15.8 million gleaning and food 
recovery initiative. We throw away 95 billion pounds of food 
every year into garbage cans. It is not eaten. It is not used. 
Hotels, hospitals, restaurants, you name it. It is thrown away. 
The Congress passed a law 2 years ago called the Bill Emerson 
Good Samaritan Act which says you can donate food without fear 
of legal liability. Communities all over the country are doing 
this. So, we include this new gleaning and food recovery 
initiative to provide community-based grants to help 
neighborhood organizations recover edible food and use it to 
help alleviate hunger.
    I just have a couple more things to cover.
    In the area of conservation, USDA's conservation mission 
has dramatically expanded as a result of the 1996 farm bill. 
That was the strongest conservation farm bill ever in my 
judgment, certainly since the 1930's.
    The budget protects and strengthens the core conservation 
technical assistance and watershed work that NRCS carries out.
    It supports implementation of the Administration's Clean 
Water Action Plan to protect rivers and streams.

                         CONSERVATION PROGRAMS

    It increases funding for the EQIP program, the 
Environmental Quality Incentives Program, to $300 million.
    The budget also funds the Lands Legacy initiative which 
will help USDA address the serious problem of prime farmland 
loss. The Farmland Protection Program would be reauthorized for 
this purpose.
    Other conservation and land retirement programs, 
particularly the CRP, Conservation Reserve Program, Wetlands 
Reserve Program--and those are programs that I know Senator 
Cochran has had great interest in--are also continuing to have 
a positive impact on the environment.
    The budget also supports the administration's global 
climate change initiative.
    Finally, I want to talk just for a moment about customer 
service and program delivery.

                 CUSTOMERS SERVICE AND PROGRAM DELIVERY

    Improving customer service and program delivery remain high 
priorities for what Abraham Lincoln called the ``People's 
Department''. We were set up to run in a decentralized way. We 
have offices all over this country. In some cases, we have done 
a great job. In some cases, I think for minority farmers and a 
lot of small farmers and there have been some other 
traditionally underserved farmers in our farm and rural 
development programs, we have not done such a good job over the 
years, and improving customer service for all farmers is a high 
priority for me and for the Department.
    Streamlining and collocating the county-based agencies in 
one-stop USDA service centers is a prime focus. We are having 
some very good success here under the leadership of Deputy 
Secretary Rominger.
    Administrative convergence is underway to consolidate 
administrative support functions for the county-based agencies 
and modernize program delivery.
    A common computing environment is being implemented to 
improve our efficiencies across the agencies.
    And we have tightened our belt to become more efficient in 
response to constrained or reduced funding. We at USDA have 
22,000 fewer employees today than 1993. The fact is there has 
been significant downsizing in the Department of Agriculture, 
and we are doing that and we are struggling to keep up with the 
continued heavy workload, particularly as we relate to the 
responsibilities under the 1996 farm bill. We want to provide a 
high level of customer service and if we are not treating our 
people out there in the countryside very well, we are not doing 
our job.
    So, it may be that funds will be needed to meet our 
workload and customer service requirements, particularly in 
farm program area, and that is something that we will address 
if we decide that a supplemental request is necessary in 
addition to some of the other things that we may have in mind.

                           PREPARED STATEMENT

    So, our goal is to do the best job we can in delivering the 
programs that Congress has put in place under this committee's 
leadership. You have taken the lead to do that.
    I thank you very much for allowing me to make this 
statement.
    [The statement follows:]
                   Prepared Statement of Dan Glickman
    Mr. Chairman, Members of the Committee, it is a privilege to appear 
before you to discuss the 2000 budget for the Department of Agriculture 
(USDA).
    Even though the Federal Budget is now in surplus for the first time 
in 30 years, USDA's 2000 budget is still governed by the constraints 
put in place by the Balanced Budget Act of 1997. Thus, we are faced 
with another year of very tight funding. However, we have tried to 
provide the necessary resources that will enable USDA to achieve the 
basic goals and objectives of its strategic plan as well as focus on 
some key Presidential initiatives on food safety, nutrition and food 
assistance, global change, and conservation and the environment. And, 
as the President indicated in his State of the Union message, we must 
work with lawmakers of both parties to create a farm safety net that 
will include crop insurance reform and farm income assistance.
    The Presidential initiatives that involve participation of USDA 
agencies, include:
    A continuing Food Safety initiative for improving the Federal food 
inspection system from farm-to-table, through increased inspection, 
expanded research and consumer education, better surveillance of 
foodborne illness, and improved Federal, State, and local coordination.
    A Lands Legacy initiative to develop a national program to protect 
great places and to provide the tools for localities, States, Indian 
tribes, and non-profit corporations and cooperatives to plan Smart 
Growth, open space preservation, and land use management. $268 million 
of the $1 billion governmentwide program would be provided to USDA.
    A Global Change Research initiative aimed at investigating 
mitigation tactics to minimize the adverse effects of climate change on 
agricultural production, and inventory soil carbon levels, research how 
soils absorb carbon, and expand biomass research.
    A Climate Change Technology initiative to develop technology for 
predicting and adapting agricultural production to global change 
impacts and to demonstrate and test various greenhouse gas mitigation 
strategies and monitoring mechanisms.
    A Clean Water Action Plan to improve water quality on the Nation's 
forested lands and to address water quality issues, such as waste 
management and grazing practices on private lands. It also includes new 
research on hypoxia, pfiesteria, and related problems.
    The budget also focuses resources on the following priority areas:
    Providing adequate funding for Food Stamp, Child Nutrition, and WIC 
Programs, increased funding for program integrity initiatives, a new 
gleaning and food recovery initiative, a school breakfast research 
pilot, and restoration of food stamp benefits for elderly immigrants.
    Meeting the urgent needs for water and housing in rural 
communities.
    Supporting research to improve the productivity and competiveness 
of our farmers, to help solve environmental problems and to provide 
safe, nutritious food for all Americans.
    Strengthening our risk management programs, providing small farm 
assistance, and modernizing farm program delivery.
    Expanding domestic and overseas markets through aggressive 
promotion and a reduction in impediments and restrictions to trade.
    Carrying out an aggressive civil rights policy to correct past 
weaknesses and fairly implement new program proposals.
    The discipline imposed on the 2000 budget has forced us to make 
difficult decisions to restrain, reduce, and redirect resources to 
focus on the priority goals we established. We again propose user fees 
and contain and absorb certain costs. We are continuing to scrutinize 
our employment and business practices. As a part of the Department's 
continuing reorganization, we are implementing a field office 
streamlining plan which collocates the county-based agencies in one-
stop USDA Service Centers and to consolidate administrative support 
functions in a new Support Services Bureau and modernize program 
delivery. We are implementing a common computing environment for these 
agencies to optimize the use of data and equipment and improve our 
efficiencies across the agencies. These efforts, combined with program 
reductions and reforms taken in prior years, have made a significant 
positive contribution to the current favorable Federal budget 
situation.
    The President's budget proposes $55.1 billion in budget authority 
for 2000 for USDA compared to a current estimate of $67.5 billion for 
1999. Budget authority for discretionary spending, which accounts for 
about 28 percent of USDA's total budget authority, declines from $15.8 
billion in 1999 to $15.2 billion in 2000. The request before this 
Committee for discretionary budget authority is $13.2 billion.
    The budget again proposes legislation that could affect the 
appropriation for the Department, including user fees for the Food 
Safety and Inspection Service; the Animal and Plant Health Inspection 
Service; and the Grain Inspection, Packers and Stockyards 
Administration. This proposed legislation will be sent to the 
authorizing committees, and the request before this Committee is not 
adjusted for the passage of this legislation. Upon enactment of fee 
authorizations, we would forward you our revised appropriation request. 
However, the appropriations request will include a proposed assessment 
on tobacco marketings similar to the expiring marketing assessment 
established by the Budget Reconciliation Act of 1993.
    The budget also proposes legislative changes in some mandatory 
programs, e.g., restoring food stamp benefits to elderly legal 
immigrants, reauthorizing and funding a range of conservation programs, 
providing mandatory funding for the Foreign Market Development 
Cooperator Program, providing rural development grants and direct 
Treasury rate electric loans.
    I also want to emphasize the importance that the President and I 
have placed on USDA civil rights issues; this priority is reflected in 
the budget. The President's budget provides the necessary funding to 
continue to carry out the recommendations of the Civil Rights Action 
Team (CRAT) as well as the recommendations of the National Commission 
on Small Farms which support our civil rights agenda.
                 farm and foreign agricultural services
    The mission of the Farm and Foreign Agricultural Services area to 
secure the long-term vitality and global competitiveness of American 
agriculture, has surely been tested by the tough times farmers and 
ranchers are now facing. While planting flexibility provisions of the 
Federal Agriculture Improvement and Reform Act of 1996 (the 1996 Act), 
strong export and trade policy programs, and other program initiatives 
already underway have helped many crop and livestock producers, it is 
clear, as the President indicated, that the farm safety net still needs 
some reinforcement.
    The Administration and Congress worked together last year to 
support farmers in areas hit hard by declining prices and successive 
years of reduced yields. This year we will continue our efforts to 
expand and improve programs which help producers manage risk, and we 
look forward to working with Congress to further reform the insurance 
programs for crop and livestock producers. We are also working hard to 
expand opportunities for small farmers and others who traditionally 
have been under served in our farm programs. The class action 
settlement with African American farmers I announced last month closes 
a painful chapter in USDA's history but does not complete our civil 
rights initiative. We still have more to do to ensure all of our 
customers and our employees are treated with dignity and respect.
    The weakening farm economy has challenged our efforts to improve 
customer service while improving efficiency in the Farm Service Agency 
(FSA) and the other county-based conservation and rural development 
agencies. While additional funding provided in the Agriculture, Rural 
Development, Food and Drug Administration and Related Agencies 
Appropriations Act, 1999 (the 1999 Act) allowed FSA to maintain current 
staffing levels, the increasing demand for Commodity Credit Corporation 
(CCC) Marketing assistance loan programs and disaster assistance has 
dramatically increased workload and placed new burdens on county staff. 
The higher workload, particularly for the marketing assistance 
programs, is projected to continue at least through 2000. The need to 
find new ways of doing business in the service centers is underscored 
by findings of the independent study of county-based agencies conducted 
by Pricewaterhouse Coopers. The recently completed study recommends 
further steps to improve the efficiency of program delivery and field 
office operations of the county-based agencies. It also supports on-
going efforts by the Department to streamline offices, establish a 
common computing environment, converge administrative services. We are 
currently evaluating the results of this study to determine how best to 
take it into account in our on-going efforts.
    Farm Service Agency FSA Federal and county staffing since 1993 has 
declined by about 6,000 staff years, from over 22,500 staff years at 
the end of 1993 to about 16,400 staff years at the end of 1998. 
Additional funds appropriated for 1999 in the 1999 Act have allowed the 
agency to avoid reductions-in-force this year and to hire additional 
temporary staff. The proposed program level in 2000 for salaries and 
expenses of $1 billion is estimated to support a ceiling of 5,745 
Federal staff years, and 10,048 non-Federal county staff years, 
assuming legislation is enacted allowing for CCC to cover a portion of 
FSA's computer operations and maintenance costs for the farm programs.
    Farm Loan Programs Traditionally, USDA's role in the farm credit 
market has been to be the ``lender of last resort.'' Currently, the 
Department supplies only about 5 to 6 percent of the credit used by 
farmers the rest is supplied by private lenders, including the 
federally-chartered Farm Credit System. However, the Department's role 
is important because it provides opportunities for farmers who 
experience financial difficulty to stay in business, and fills credit 
gaps, particularly for socially disadvantaged and beginning farmers.
    Because the programs operate at the margin of the credit market, 
they are vulnerable to changes in market conditions and sometimes it is 
very difficult to predict changes in demand for program assistance. 
Right now, there is a great deal of uncertainty as to the impact recent 
declines in farm prices and income may have on repayments of past debts 
and the willingness of private lenders to make new loans. Even small 
changes in these factors can have a proportionally larger impact on the 
number of applicants seeking program assistance and the amount of their 
requests. USDA is keeping a very careful eye on the situation as it 
develops, not only for year 2000, but also for meeting the more 
immediate needs in 1999.
    The 2000 budget request reflects a fairly optimistic projection one 
that envisions a reasonably good supply of farm credit provided by 
private lenders. The Administration believes that this is a good 
starting point. But, I will not hesitate to request additional funding 
if conditions deteriorate and there is evidence that additional program 
assistance is needed.
    Specifically, the budget request includes about $3 billion in farm 
loans and guarantees slightly more than the $2.8 billion available for 
1999. Because interest rates continue to decline, thereby reducing the 
subsidy costs, the higher program level for 2000 can be supported with 
far less budget authority than was necessary in 1999 ($77.3 million 
compared to $121.1 million).
    For farm operating loans, the 2000 budget includes $1.7 billion in 
unsubsidized guarantees, $500 million in direct loans, and $97 million 
in subsidized guarantees. This mix reflects a shift to more 
unsubsidized guarantees. Favorable interest rates should help more 
farmers qualify for such credit and USDA's recent publication of a 
final rule for streamlining the guaranteed loan program and 
establishing a preferred lender program should encourage private lender 
participation.
    For farm ownership loans, the 2000 budget includes $128 million in 
direct loans, compared to $86 million available for 1999, and $431 
million for unsubsidized guarantees, which is about the same as 1999.
    In addition, the 2000 budget includes $100 million in loans for the 
boll weevil eradication program and $53 million in emergency loans. The 
Administration plans to review gaps in the emergency loan program which 
deny credit to farmers and agriculture-related businesses that is 
otherwise available to non-farmers through the Small Business 
Administration (SBA). It intends to propose legislation to eliminate 
such gaps.
    The 2000 budget also includes $4 million in grants for the State 
mediation program, double the amount available in 1999. This program 
provides a valuable service in resolving disputes over the 
administration of the farm credit and other USDA programs.
    Commodity Credit Corporation Changes over the last decade in 
commodity, disaster, and conservation programs have dramatically 
changed the level, mix, and variability of CCC outlays. CCC outlays are 
projected to increase from $10 billion in 1998, to $18 billion in 1999, 
and then to decline again to about $12 billion in 2000. The increase in 
spending between 1998 and 1999 is accounted for by higher marketing 
assistance loan program outlays, expenditures related to the 
President's International Food Aid initiative, and by emergency 
spending authorized for disaster assistance programs authorized by the 
1999 Act. The disaster assistance provision expenditures authorized in 
the 1999 Act total nearly $5.9 billion, including $3.1 billion for 
market loss payments, $2.4 billion to compensate producers for crop 
losses, and $0.2 million for livestock feed assistance. In 2000, 
commodity program outlays account for about three-fourths of the total 
CCC outlays, with production flexibility contract payments and loan 
deficiency payments accounting for nearly all of the commodity program 
outlays.
    Conservation program outlays account for most of the remaining CCC 
expenditures in 2000. The 1996 Act authorized direct CCC funding for 
the Conservation Reserve Program (CRP) administered by FSA and several 
new conservation programs administered by the Natural Resources 
Conservation Service (NRCS).
    CRP provides landowners annual payments and half the cost of 
establishing a conserving cover in exchange for retiring 
environmentally sensitive land from production for 10 to 15 years. The 
1996 Act authorized the program through 2002 and set maximum enrollment 
in the program at 36.4 million acres. About 30.3 million acres were 
enrolled in the program at the end of 1998. The 2000 budget assumes 
nearly 6 million acres will be accepted in the 18th signup, conducted 
in October through early December 1998. In addition, the continuous, 
non-competitive 17th signup has been underway to enroll land in filter 
strips, riparian buffers, and similar special conservation practices.
    Other conservation programs funded by CCC but administered by NRCS 
include the Wetlands Reserve Program (WRP), the Environmental Quality 
Incentives Program (EQIP), the Wildlife Habitat Incentives Program 
(WHIP), and the Farmland Protection Program (FPP). WRP offers 
landowners the opportunity to receive payments for restoring and 
protecting wetlands on their properties. For 2000, approximately 
200,000 acres are proposed for enrollment resulting in a cumulative WRP 
acreage enrollment of 975,000 acres, the maximum enrollment level 
mandated by law. This program is a cornerstone supporting the Clean 
Water Action Plan. EQIP gives producers incentives to implement long-
term comprehensive farm plans and the budget proposes to increase the 
annual program level from $174 million in 1999 to $300 million 
beginning in 2000. WHIP provides cost-share assistance to landowners to 
implement management practices improving wildlife habitat and FPP 
provides for the purchase of easements limiting nonagricultural uses on 
prime and unique farmland. Under proposed legislation, WHIP and FPP 
would be funded annually through CCC at $10 million and $27.5 million, 
respectively, beginning in 2000. FPP is also slated to receive $50 
million in discretionary funding from the Vice President's new Lands 
Legacy initiative.
    Finally, provisions of the Commodity Credit Corporation Charter Act 
(the CCC Charter Act) limit CCC expenditures for computer equipment and 
cap, at the 1995 expenditure level, total allotments and transfers to 
State and Federal agencies under Section 11 of the Act for 
administrative support services. These provisions impose significant 
restrictions on the availability of CCC funds for transfers and 
reimbursable agreements used to fund conservation technical assistance 
and other support services for the conservation, commodity, and export 
programs.
    By 2000 the amount available under the computer cap will be nearly 
exhausted preventing needed investment in our streamlining and Service 
Center initiatives and prohibiting the Department from investing in 
much-needed technology for business process reengineering efforts. USDA 
needs these investments to improve service to our customers and reduce 
program delivery costs.
    The budget for 2000 includes a legislative proposal to raise the 
limit on CCC expenditures for computer equipment by a total of $105 
million for the period 2000 through 2002. The increase in the multi-
year cap will cover a portion of FSA's computer operations and 
maintenance costs for the farm programs, and will be offset by an 
equivalent reduction in authorized spending for the Export Enhancement 
Program (EEP). Additional reductions in EEP will be proposed to offset 
increased spending for EQIP and to offset proposed CCC funding for the 
Foreign Market Development Cooperator Program and for a ``quality 
samples'' proposal to boost the promotion of U.S. exports.
    Risk Management Agency The need for supplemental funding in the 
1999 Act for production losses and price declines in the farm economy 
certainly provides a chilling example of shortfalls in the program. 
Nonetheless, the facts are that since the 1994 reform of the crop 
insurance program, producers have had the opportunity to obtain 
protection against production losses free of cost, except for a 
processing fee, for catastrophic losses and at a subsidized rate for 
higher levels of coverage. Over 60 percent of insurable acres has been 
covered. There could be a substantial increase in participation in this 
crop year due to an additional 30 percent subsidy of premium rates that 
is being provided as part of the 1999 supplemental funding.
    A key element in the success of the crop insurance program is the 
partnership with the private insurance industry, which not only 
delivers the program but shares in the risk. This partnership has 
resulted in innovative changes such as the development of revenue 
insurance. There are 17 private insurance companies of various sizes 
participating in the program. They provide delivery, mostly through 
their own sales agents who work on a commission basis. Loss adjustment 
is usually done by independent contractors. Companies are reimbursed at 
a rate of 24.5 percent of premium, which is the maximum fixed by law. 
They also may receive underwriting gains for favorable loss experience.
    Within USDA, the program is administered by the Risk Management 
Agency (RMA) and is carried out through the Federal Crop Insurance 
Corporation which has a Board of Directors composed of both Government 
and private sector members.
    Legislation enacted last year authorized the shift of delivery 
expenses paid to private companies from discretionary to mandatory 
spending, which also includes premium subsidy and other program costs. 
The 2000 budget requests an appropriation of ``such sums as necessary'' 
for the program's mandatory spending. Such an appropriation is similar 
to previous years' appropriations, and provides the assurance of full 
funding for increases in sales volume and potential losses.
    For discretionary spending, which includes salaries and expenses 
for RMA staff, the budget requests $71 million an increase of $7 
million over 1999. This increase would allow RMA to strengthen its 
efforts in research and development, to extend its risk management 
education program, and to enhance its civil rights activities and to 
provide public outreach.
    The Administration intends to continue working on improving the 
crop insurance program. It believes that there is widespread support 
for the program because producers appreciate the assurance of risk 
protection the program provides rather than the uncertainty of ad hoc 
disaster assistance. Further, it believes that such protection offered 
on an actuarially sound basis, with producers sharing in the cost, is 
consistent with production efficiency. The Administration will do 
everything possible to encourage program participation, to correct any 
inequities in the structure of premium rates, yield guarantees, or 
other program provisions, to make the program user-friendly for 
companies and producers alike, and to facilitate new product 
development and other program innovations. As a strong first step in 
improving and energizing the program, last year's emergency 
supplemental has allowed us to make a $400 million down payment this 
year in helping farmers meet their crop insurance needs. These funds 
will be used to reduce 1999 insurance premiums by 30 percent.
    The Administration stands ready to work with the Congress on 
improving the safety net for farmers. We have already announced the 
Administration's principles and preliminary proposals for strengthening 
the farm safety net by reforming the crop insurance program and we plan 
to hold 3 regional forums around the country to receive input from 
farmers and other interested parties. A white paper on the subject can 
be viewed at the USDA website on the internet. Through the forums and 
discussions with Congress, the Administration intends to build upon our 
proposals to forge a bipartisan agreement on crop insurance reform.
    International Trade and Export Programs Developments in overseas 
markets during the past year have certainly demonstrated that the 
health of the American farm economy is inextricably linked to the 
global economy. As markets in Asia, Latin America, Russia, and 
elsewhere experienced financial turmoil and their imports of food and 
agricultural commodities were cut back, the effects of those 
developments were felt throughout rural America.
    Strong export markets are an important component of the 
agricultural safety net, and we are committed to helping our farmers 
and ranchers broaden their access to overseas markets and maximize 
export sales. Faced with the challenges posed by last year's 
disruptions in global markets, we have responded aggressively by 
utilizing our export program authorities to ensure the continued flow 
of U.S. agricultural exports. We have expanded substantially the level 
of CCC export credit guarantees made available to markets in Asia, 
which otherwise would have been unable to obtain financing for their 
food and agricultural imports. As a result, sales registrations under 
the guarantee programs exceeded $4 billion in 1998, an increase of 40 
percent above the previous year.
    In July, President Clinton announced his Food Aid Initiative under 
which the United States is providing as much as 5 million metric tons 
of wheat and wheat products to assist needy countries. Moreover, we 
have developed a package of food assistance for Russia, which will 
provide over 3 million metric tons of commodities, once fully 
implemented.
    We also have continued our efforts to open and expand markets 
through a wide range of trade policy activities. For example, last 
February the United States and Taiwan signed a market access agreement 
which provides for Taiwan to lift its import bans and allow access for 
U.S. pork, poultry, and variety meats. Upon Taiwan's accession to the 
World Trade Organization, Taiwan will cut tariffs and open tariff-rate 
quotas on numerous agricultural products.
    We continue to prepare for the new round of multilateral trade 
negotiations which is set to begin later this year and presents an 
opportunity to further strengthen disciplines on agricultural trading 
practices. We are pursuing market opening agreements on a regional 
basis as well, including negotiations for the Free Trade Area of the 
Americas and within the Asia Pacific Economic Cooperation forum. And, 
we continue to respond to the growing challenges posed by technical 
barriers to trade, such as sanitary and phytosanitary barriers that are 
not scientifically based.
    In order to ensure we are able to continue these activities and our 
export promotion objectives can be achieved, our budget proposals 
provide an overall program level of nearly $6.5 billion for USDA's 
international programs in 2000. For the CCC export credit guarantee 
programs, the largest of our export activities, the budget includes 
program levels of $4.7 billion for 1999 and $4.5 billion for 2000. 
These levels continue the higher level of guarantee programming which 
was established last year in response to developments in Asia. However, 
the actual level of guarantees to be issued will not be limited by the 
budget estimates, but instead will be determined by market conditions 
and program demand.
    The Department carries out a number of market promotion programs 
which play a crucial role in efforts to develop and expand overseas 
markets. The Market Access Program (MAP) has been particularly 
instrumental in helping small and new-to-market companies build new 
markets overseas. To further those efforts, all MAP assistance for 
brand promotions is now reserved for small businesses and cooperatives. 
For 2000, the budget provides funding for MAP at the maximum authorized 
level of $90 million, which is unchanged from 1999.
    The Foreign Market Development Cooperator Program, a mainstay of 
USDA export promotion efforts since 1954, provides cost-share 
assistance to nonprofit commodity and agricultural trade associations 
to support market development activities designed to remove long-term 
impediments to increased U.S. trade. Beginning in 2000, the budget 
proposes that the Cooperator Program be funded by CCC rather than the 
FAS appropriation. However, funding for the program will remain at its 
current level of $27.5 million per year. This proposal is consistent 
with the CCC Charter Act which authorizes the Corporation's funds to be 
used for market development activities. By providing a permanent 
authorization for CCC funding, the proposed change will provide greater 
stability for future program activities and will thereby enhance long-
term planning by program participants.
    The budget also includes funding to implement a new market 
promotion activity, the Quality Samples Program. Under this initiative, 
samples of U.S. agricultural products will be provided to foreign 
importers in order to promote a better understanding and appreciation 
of their high quality. The program will be carried out under existing 
authorities through commodity organizations and agricultural trade 
associations, similar to the Cooperator Program, and on a pilot basis 
will be funded by CCC at an annual program level of $2.5 million.
    The budget provides funding to continue both of the Department's 
export subsidy programs the Dairy Export Incentive Program (DEIP) and 
the Export Enhancement Program (EEP). In the case of DEIP, the budget 
assumes a program level which continues programming near the current 
level. For EEP, a program level of $494 million is proposed for 2000, 
which is below the authorized level of $579 million. Proposed 
legislation to limit EEP programming will be submitted in order to 
provide PAYGO savings which are needed to help offset the costs of 
other initiatives in the budget which will increase mandatory spending 
for agricultural programs. Although EEP will be limited to the $494 
million level, the program will remain in place and the awarding of 
bonuses can be resumed whenever market conditions warrant. The 
Administration will also propose to permit unobligated balances of EEP 
funds to be transferred to other foreign food assistance programs, such 
as Public Law 480, toward the end of each year.
    For Public Law 480 foreign food assistance activities, the budget 
provides an overall program level of $987 million. This is projected to 
provide approximately 3.2 million metric tons of commodity assistance 
to recipient countries. In 2000, this tonnage level is expected to be 
supplemented by additional food assistance to be provided under the 
Food for Progress Program and section 416(b) of the Agricultural Act of 
1949.
    For the Foreign Agricultural Service (FAS), the budget provides 
appropriated funding of $115 million. This is $25 million below the 
1999 enacted level due to the proposal to fund the Cooperator Program 
through CCC rather than the FAS appropriation. The budget provides 
funding for several new initiatives for FAS, including the opening of a 
new Agricultural Trade Office in the southern Africa region and 
implementation of a Reverse Buying Missions Program. The latter will 
bring buying missions of foreign importers, retailers, and trade 
officials to the United States to orient them on the quality and 
diversity of U.S. agricultural products. The program will be focused on 
markets in which the United States is generally competitive and has a 
clear potential for expanding commercial sales.
                           rural development
    USDA's rural development programs provide decent, safe and sanitary 
housing as well as amenities such as safe drinking water, waste 
disposal, electrical and telephone service. They also provide jobs both 
for the construction of projects and employment within those projects, 
and for improved employment opportunities that result from the 
strengthening of rural economies. Rural America remains diverse. There 
are prosperous rural communities centers of local economic activity, 
communities that are attractive for recreation or retirement, and some 
that have been remarkably successful in bringing in high technology and 
other modern day businesses. However, there also are numerous areas 
with severe poverty and economic depression places that have lost their 
economic base of farming, forestry, mining or other traditional 
enterprises. These communities have high rates of poverty, limited 
opportunities, and lack even basic necessities. USDA's rural 
development programs help alleviate these inequities, so that the 
people who live in rural communities may have the same opportunity to 
share in the benefits of the Nation's prosperity.
    The 2000 budget includes almost $11 billion in loan, grant and 
other assistance for rural development. This represents an increase of 
almost $800 million over the amount available for 1999. The higher 
program level can be supported at about the same cost to the Government 
roughly $2.2 billion in budget authority, including $200 million in 
budget authority that is being forward financed into 2001 due primarily 
to a reduction in subsidy costs for direct loans, which reflects the 
overall decline in interest rates.
    USDA's rural development programs support a number of long-standing 
initiatives of the Administration including the President's 
Homeownership Initiative, Water 2000 and the Empowerment Zones and 
Enterprise Communities (EZ/EC) Initiative. In 2000, Rural Development 
would also contribute to the Smart Growth Partnership by helping to 
administer a $50 million loan program which is included in the budget 
for the Forest Service.
    Over $3 billion in loans and grants ($670 million in budget 
authority) would be budgeted under the Rural Community Advancement 
Program (RCAP) which allows flexibility to transfer funds among 
programs to meet State and local priorities. These priorities must be 
based on strategic plans to help guide the development process. RCAP 
was authorized in the 1996 Act, but recent appropriations acts have 
restricted its full implementation although the 1999 Appropriations Act 
provided more flexibility than in prior years. The 2000 budget would 
allow RCAP to be fully implemented.
    The Administration will propose legislation to provide $15 million, 
annually, in grants to the rural communities that were selected in the 
second round of the EZ/EC initiative. The 2000 budget also provides for 
the targeting of about $200 million in loans and grants under USDA's 
rural development programs to the EZ/EC initiative. In addition, a 
number of the EZ communities receive certain tax benefits. The EZ/EC 
initiative has encouraged communities to develop strategic plans to 
meet their goals and objectives. It has created jobs and economic 
growth, and has served as a model for non-EZ/EC communities to meet the 
challenge of planning for their future.
    USDA's rural development programs are administered through State 
and local offices, all located within USDA Service Centers. The 2000 
budget includes just under $542 million for Rural Development salaries 
and expenses. This funding level is approximately $27 million over 1999 
and is expected to be sufficient to maintain staffing at current 
levels.
    Rural Utilities Service The programs administered by the Rural 
Utilities Service (RUS) provide financing for electric, telephone, and 
water and waste disposal services. These programs have a long history 
of significant contributions to rural America literally lighting up 
rural households, allowing those households to communicate with the 
rest of the world, and bringing running water for indoor plumbing. 
While almost all of rural America now have these basic necessities, the 
challenges in recent years has been to maintain and upgrade the 
facilities that provide service, to ensure that rural America does not 
fall behind in the fast-paced world of high-tech communications, and to 
address the increasing risks of unsafe or poor quality water.
    The 2000 budget would support over $1.6 billion in electric and 
telephone loans, which is about $75 million less than 1999. The 
Administration will submit legislation to authorize direct electric 
loans at a Treasury rate of interest. Under the proposed legislation, 
$400 million in such loans would be shifted from FFB directly to RUS.
    The 2000 budget also reflects additional direct loan activity under 
the Distance Learning and Telemedicine program. This program was 
initially designed to provide only grants. However, there has been an 
overwhelming request for assistance due to the awareness of rural 
communities that the high-tech world of communications offers their 
best chance to receive enhanced learning and medical services and 
connect to the information-based economy. In order to serve more of 
these communities, the program was expanded in 1996 to include loan as 
well as grant assistance. RUS expects to see substantial progress in 
loan activity. In anticipation, the 2000 budget provides for an 
increase in the loan program to $200 million in loans. It also provides 
for an increase in grants from $12 million available in 1999 to $20 
million in 2000.
    The 2000 budget includes $503 million in grants and $975 million in 
loans For the water and waste disposal program together representing an 
increase of $156 million over the amount available for 1999. The 
program will continue to be targeted, under the Water 2000 initiative, 
to communities with the most serious needs for assistance which means 
that they lack service, are at risk of health due to unclean water or 
unsanitary conditions, cannot afford to pay the full cost of service 
due to high incidence of poverty.
    Rural communities benefit not only directly in terms of the 
services their residents receive from the facilities financed by water 
and waste disposal loans and grants, but also, in terms of the jobs and 
overall economic growth that can result from those services being 
provided to commercial users. The secondary impact can, in fact, turn 
rural communities around giving them the means to attract industry to 
diversify their economies.
    Rural Housing Service USDA rural housing programs have played a key 
role in providing affordable homeownership and rental opportunities in 
rural America since the 1960's. The programs serve very low to moderate 
income families who cannot obtain conventional credit and cannot 
otherwise afford decent, safe and sanitary housing. Interest and rental 
payment assistance reduces the cost of such housing to the families' 
ability to pay, based on income and other factors. The overall decline 
in interest rates has made it possible to operate the direct 
homeownership program at relatively modest cost for 2000, less than 10 
percent per dollar of loans. The 2000 budget would support $1.1 billion 
in direct (single-family) homeownership loans compared to $965 million 
in 1999.
    In addition, the 2000 budget would support $3.2 billion in 
guarantees $200 million more than in 1999. The loan guarantee program 
has operated for only a few years and has proven to be helpful in 
filling gaps in the commercial credit market where lenders are 
reluctant to make loans on their own. The program offers no interest 
payment assistance, so borrowers must be able to pay commercial rates 
of interest. However, the subsidy cost of the guaranteed program is 
only about 1 percent per dollar of loan guaranteed. The combined total 
of $4.3 billion in homeownership loans and guarantees is expected to 
serve over 50,000 rural families.
    The 2000 budget provides for $100 million in direct loans and $200 
million in guarantees for rental housing, $100 million of which would 
be contingent on legislation to eliminate the statutory requirement 
that 20 percent of the units in projects with guarantees receive 
interest payment assistance. The guaranteed program for rental housing 
is relatively new and uses other sources of funds and financial 
incentives, such as tax credits. Experience has shown, that the program 
can be operated without interest payment assistance and still serve low 
income families due to the combination of other incentives.
    In the direct rental housing program, RHS currently has a portfolio 
of about 18,000 projects with approximately 245,000 units receiving 
rental assistance payments. In year 2000, it is anticipated that about 
41,800 of these units will require renewal at a cost of $603 million. 
Some additional units in existing projects will be provided for 
servicing purposes and a small number of units are expected to be 
provided in new projects, including those for farm labor housing. In 
total, the 2000 budget includes $640 million for rental assistance 
payments, of which $440 million would be available beginning in 2000. 
The remaining $200 million would be available beginning in 2001. The 
budgeting of 2000 program needs over 2 years will not affect the flow 
of funds to project sponsors or impact occupants in such projects.
    RHS also administers several housing programs that serve specific 
needs, including farm labor housing, self-help housing for families who 
trade their sweat equity for a chance to own their own home, and very-
low income repair loans and grants. The 2000 budget provides for the 
continuation of these programs at sightly higher levels than available 
for 1999.
    In addition, RHS administers a program of direct and guaranteed 
loans and a limited amount of grants for essential community 
facilities. In recent years, the priority has been to serve children 
and the elderly through child care centers and health facilities; 
however, a wide range of projects have received this assistance, to 
reflect the diversity of State and local priorities. The 2000 budget 
would support $250 million in direct loans $80 million more than 
available in 1999. Guaranteed loans would remain at the same level as 
in 1999 $210 million. In addition, the 2000 budget includes $15 million 
for grants, $5 million of which would be used for early warning systems 
for hazardous weather conditions.
    Rural Business-Cooperative Service Many rural communities need a 
more diversified economic base one that will provide good-paying jobs 
and withstand the fast-paced challenges of a high-tech global 
marketplace. The Administration has undertaken initiatives such as EZ/
EC which requires communities to develop strategic plans in the process 
of competing for designation. Implementing these plans, requires 
significant financial resources. The primary source of capital must be 
the private sector and there are many ways to encourage private lenders 
to be more responsive to unmet needs, such as through tax credits and 
other incentives. Programs that offer guarantees and, in some cases, 
direct loans also contribute to the supply of credit. Within USDA, 
these programs are administered by the Rural Business-Cooperative 
Service (RBS).
    RBS' largest program is the business & industry loan guarantee 
program which has operated at a level of about $1 billion for the last 
few years, and would be continued at that level in the 2000 budget. 
This level of funding is expected to produce almost 38,000 jobs in 
rural America. In recent years, the program has had very few losses and 
the cost to the Government has been minimal.
    The 2000 budget continues the direct business & industry loan 
program at a $50 million level. This program is particularly helpful in 
filling gaps in the credit market, particularly in areas that are 
underserved by private lenders. In addition, the 2000 budget provides 
for $52 million for the intermediary relending program $19 million more 
than 1999. This program allows intermediaries to develop their lending 
capacity. Currently, each dollar loaned to an intermediary circulates 
about 3 times over its lifetime. Further, the experience intermediaries 
gain in loan making improves their prospects for gaining access to 
other sources of funding.
    The rural business enterprise grant program would be funded at $36 
million about the same as available for 1999. In addition, there would 
be $5 million for the new partnership technical assistance grant 
program. This program provides communities with assistance for 
strategic planning and would help them better coordinate and leverage 
Federal, State, and private funding.
    The 2000 budget also provides $5 million for rural cooperative 
development grants ($3 million more than available in 1999), $2 million 
for the appropriate technology transfer program, $700,000 more than the 
1999 level, $2 million for cooperative research agreements (the same as 
in 1999), and $10 million for the Alternative Agricultural Research and 
Commercialization Corporation (compared to only $4 million available 
for 1999).
    As noted earlier, the Administration will be proposing legislation 
to provide mandatory funding of $15 million each year for the second 
round of rural EZ/EC's that were announced recently. In 2000, RBS will 
also administer a new $50 million loan program in support of the Smart 
Growth under the Lands Legacy initiative. Funding for this program is 
included under the Forest Service budget and would be administered by 
RBS under the authorities used to establish the intermediary relending 
program.
                 food, nutrition and consumer services
    America has the most affordable, safest food supply in the world, 
thanks to its hard-working farmers and producers. However, with nearly 
36 million Americans living in poverty, millions of Americans still 
need nutrition assistance. USDA's nutrition assistance programs are 
part of the national safety net. Proper nutrition and sufficient food 
is as essential to the successful transition from Welfare to work as 
child care and health insurance. The importance of nutrition support 
does not diminish as families leave welfare. A family working full-time 
throughout the year at the minimum wage can lift themselves out of 
poverty, but only with the assistance of food stamps. The budget 
requests an appropriate level of funding for this effort for Food 
Stamps, Child Nutrition, and the WIC program, the Nation's primary 
means for carrying out food assistance policy. Over two-thirds of the 
$36.5 billion requested will help low-income children, school age or 
under, receive the nutrition they need.
    The Food Stamp Program is budgeted at $22.5 billion in 2000, which 
includes a $1.0 billion contingency fund to cover unforeseen needs, and 
is predicated on a participation estimate of some 20.1 million people. 
While this level is higher than 1999 estimated participation of 19.7 
million, this is just cautious budgeting. The economy is expected to 
remain strong. In fact, food stamp participation is down over 9 million 
from its peak of 28 million participants in March of 1994. This trend 
began before welfare reform was enacted and intensified as welfare 
reform began to work. With the strong economy, unemployment is at the 
lowest peacetime level since 1957. Increases in child support payments 
from absent parents achieved via Administration initiatives are also 
helping low-income households reduce dependency on food stamps. The 
Department will watch fluctuations in participation levels carefully to 
ensure that food stamp eligibles are not denied access to the program 
if they or their children still require nutrition assistance.
    The budget includes several legislative proposals and initiatives 
for the Food Stamp Program. While Americans are committed to a society 
where work and responsibility are rewarded, current law does not permit 
many immigrants who have been legal residents of the United States 
since before welfare reform, to receive food stamps even after reaching 
age 65. The Department proposes to level the playing field with 
legislation that would allow such humanitarian assistance to these 
hard-working, long-time legal resident immigrants who fall on hard 
times when they are over age 65.
    The budget also includes a small amount of funding for nutrition 
education and technical assistance. This will make sure program 
eligibles understand how to get nutrition assistance and what 
assistance is available if they want it; and it will help educate them 
on how to achieve a better diet. Finally, in addition to the continuing 
effort to modernize benefit delivery via nationwide use of Electronic 
Benefit Transfer, USDA is developing a plan to reduce error. A $6 
million increase is requested as part of the plan to crack down on 
retailer and participant abuses, as well as reduce program errors 
causing overpayments.
    For the Child Nutrition Programs, including the National School 
Lunch, Breakfast, Child and Adult Care Food, Summer Food Service, and 
Special Milk Programs, the current law budget request is $9.6 billion, 
about $0.4 billion more than the 1999 level. The request assumes 
continued full funding for all of these programs, support for Team 
Nutrition and $2 million is requested for Nutrition Education and 
Training. The National School Lunch Program touches almost all school 
children during the year and can help them achieve a better diet, 
especially with this effort in nutrition education. USDA is also 
developing an integrity plan to assess and address error in the school 
lunch program for which another $2 million is requested. We will 
increase USDA's visibility at the State and local level to ensure 
program integrity. Finally, the William F. Goodling Child Nutrition 
Reauthorization Act of 1998, Public Law 105-336, (the Goodling Act) 
authorized demonstration projects in 6 school districts that would 
allow the Department to evaluate the effect of providing breakfasts 
free to all elementary school children regardless of income. The budget 
includes $3 million to pay for the meal costs, and $10 million for a 3-
year evaluation of the effects on participation, academic achievement, 
attendance, tardiness, and dietary intake.
    For WIC, the budget request calls for an increase of $181 million, 
bringing the total to $4.1 billion for 2000. This level of funding will 
support a monthly average of 7.5 million participants over the year. 
The program is widely credited with reducing anemia and improving other 
key indicators of early childhood health. Over 46 percent of the 
infants born in America are WIC participants. USDA is working to 
implement the changes in the Goodling Act, many of which would increase 
program integrity. The Department is also working with the States to 
improve program integrity and efficiency, to make sure the program 
makes as much difference as it can for needy program recipients. 
Further, as part of our Commodity Assistance Program request, the 
Department seeks $20 million for the WIC farmers' market program, a $5 
million increase. This program brings WIC recipients together with 
small, local farm producers and encourages the consumption of fruits 
and vegetables, a priority in nutrition promotion.
    The budget proposes an increase of $10 million for the Emergency 
Food Assistance Program (TEFAP). The Commodity Supplemental Food 
Program is funded to maintain the current program levels, although it 
is anticipated that caseload will continue to shift toward greater 
elderly participation. The Nutrition Program for the Elderly is 
increased by $10 million, to $150 million to increase subsidized meals 
provided to persons aged 60 or older at low-income elderly centers and 
through ``meals on wheels'' programs.
    Finally, the Department will also increase its efforts to promote 
the new Dietary Guidelines to be issued in 2000 to help all Americans 
achieve a better diet via the Center for Nutrition Policy and 
Promotion. An important principle of nutrition education is that all 
Americans can benefit, whether they participate in nutritious 
assistance programs or not. Our concern is greatest for those in need, 
but nutrition education helps everyone.
                              food safety
    As the safety of the food supply has become more important to the 
success of American agriculture and the health of consumers, the 
Department has stepped up its efforts to provide the leadership and 
expertise necessary to address the complex domestic and international 
food safety issues facing us today.
    On July 25, 1996, a milestone was reached in our strategy for 
making significant gains in improving the safety of America's food 
supply. On this date, the final rule for Pathogen Reduction and Hazard 
Analysis and Critical Control Point (HACCP) Systems for meat and 
poultry products was published. This rule modernizes a 90-year-old 
inspection system and lays out the Administration's commitment to 
improve food safety and reduce the incidence of foodborne illness by 25 
percent by the year 2000 as stated in the Department's strategic plan.
    Two more milestones were reached: in January 1998 when 
approximately 300 large plants entered the program, accounting for 75 
percent of the volume of meat and poultry production in the United 
States; and in January 1999 when over 2,800 small plants accounting for 
another 15 percent of meat and poultry production implemented HACCP. 
Implementation in large plants has been smooth thanks to the efforts of 
both industry and Government. Large plants had approximately a 92 
percent compliance rate during the first 9 months of implementation. 
Where a few problems did occur, enforcement actions were implemented 
and establishments responded by modifying and strengthening their HACCP 
plans. As of January 25, 1999, small establishments, defined as having 
between 10 and 500 employees, were required to meet the HACCP 
requirements. All other establishments must implement HACCP 
requirements on January 25, 2000.
    Recent results demonstrate that 90 percent of large HACCP 
establishments, for which there were adequate data, met the 
Government's Salmonella performance standards. Those establishments 
that did not meet the standards were required to take immediate 
corrective action. Data also indicate that there was a significant 
reduction in the prevalence of Salmonella due to the implementation of 
HACCP. The performance standards for Salmonella represent the first 
time USDA has set microbial standards for raw products on such a broad 
scale and is the first step towards a greater reliance on performance 
standards for specific pathogens.
    These data, while preliminary, indicate that the Administration's 
science-based inspection system has already had a significant effect on 
the safety of food American families eat by reducing the prevalence of 
Salmonella. Salmonella is a potentially deadly bacteria that in the 
past had sickened as many as 3.8 million Americans a year and cost 
billions of dollars in lost productivity and medical costs annually.
    The positive results from the implementation of HACCP underscores 
the important role Government plays in promoting public health, but the 
final rule is only part of our overall strategy to improve the safety 
of our meat and poultry supply. On January 25, 1997, the President 
announced the National Food Safety initiative. The initiative includes 
seven components for improving the Federal food inspection system from 
farm-to-table. Key components include expansion of the Federal food 
safety surveillance system, improved coordination between Federal, 
State, and local health authorities; improved risk assessment 
capabilities; increased inspection; expanded research, consumer 
education, and strategic planning. The initiative reflects a high level 
of coordination among agencies within USDA, the Department of Health 
and Human Services, and the Environmental Protection Agency (EPA). For 
2000, the plan is to build on these investments, which Congress has 
generously supported in both 1998 and 1999.
    For 2000, the budget proposes an appropriated level under current 
law of $653 million, a net increase of $36 million over the 1999 
current estimate. The budget includes an increase for pay costs to meet 
our statutory obligation to provide inspection services and a 
programmatic increase to implement our farm-to-table food safety 
strategy. The 2000 budget includes increases to help the FSIS 
inspection workforce make the transition to a new HACCP environment, 
including conversion of 388 current inspection personnel and hiring of 
250 new personnel as Consumer Safety Officers. In these new positions, 
these employees will be responsible for conducting scientific testing 
and inspections through the farm-to-table continuum. Some of these 
personnel will be redeployed to cover critical inspection vacancies in 
nearly 3,000 very small establishments. These redeployments and 
upgrades will increase the professional qualifications of the 
inspection workforce and cover a broader segment of the farm-to-table 
continuum. In support of the President's Food Safety initiative, the 
budget for FSIS includes increases to address food safety risks from 
farm-to-table, including: emergency response coordination with the 
States in investigating foodborne illness outbreaks; validation of the 
ability of State laboratories to meet HACCP pathogen testing 
requirements; and pathogen testing in Federal laboratories of State- 
inspected product.
    The 2000 budget request includes again this year a legislative 
proposal which would provide authority to recover the full cost of 
providing Federal meat, poultry, and egg products inspection. We 
estimate that this proposal would generate approximately $504 million 
in new revenues in 2000 and $606 million thereafter. The proposal would 
require $149 million in appropriated funding to convert the program to 
user fees and to maintain State inspection programs. States 
administering their own inspection programs would continue to be 
reimbursed by the Federal Government for up to 50 percent of the cost 
of administering their programs and the special assistance beginning in 
1999.
                   natural resources and environment
    Public awareness and concern for the Nation's natural resources has 
continued to grow as we gain a better understanding of soil and related 
resource problems and how best to address them. The importance of 
maintaining a healthy environment and a strong natural resource base 
becomes even more vital when considering the present economic state of 
rural America and the uncertainties that will be facing agriculture in 
the next century. The need to stem the decline of our important prime 
farmlands and address the problem of urban sprawl will require a 
greater Federal investment in ``Smart Growth'' programs. Understanding 
and demonstrating new methods of mitigating the adverse effects of 
global climate change on agriculture is another area to which the 
Federal Government should devote more resources. In addition, the 
plight of small, limited resource farmers has become more widely known 
as we begin to appreciate the vital role they play in American 
agriculture and the environmental and economic challenges that they 
face.
    The Administration has also targeted water pollution as a serious 
threat to the environment and has demonstrated its commitment to 
addressing this problem with the publication of the President's Clean 
Water Action Plan in February 1998. This important document comes 25 
years after passage of the Clean Water Act and outlines key Federal 
actions that will attempt to address the pollution problems of the next 
generation. USDA is called on to play a significant role in helping to 
implement this plan.
    These initiatives have put more pressure on the Department's unique 
conservation partnership and has led to an increased demand for 
financial and technical services that we provide to farmers and 
communities. The budget request for 2000 recognizes this and proposes 
an appropriated funding level of $866 million for NRCS. This includes 
$585 million for conservation technical assistance, the program that 
constitutes the backbone of the Department's partnership with 
conservation districts and farmers, as well as the primary tool by 
which the Department addresses many of the Administration's 
environmental priorities.
    The technical assistance proposal will assist in implementation of 
the Administration's Clean Water Action Plan and provides $20 million, 
including an $8 million increase, for technical assistance to owners 
and operators of animal feeding operations (AFO) to help them develop 
and implement waste management plans. Financial assistance that AFO 
operators might need to implement the plans will come from a $126 
million increase requested for EQIP which is funded through CCC. NRCS 
will direct $20 million to competitive partnership grants to enable 
locally- based organizations, such as conservation districts or 
watershed councils, to provide coordination of locally-initiated 
conservation efforts in problem identification and goal setting. 
Finally, an additional $3 million is provided for monitoring work to 
help target resources and document baseline conditions and performance.
    In support of the Administration's Global Climate Change 
initiative, the budget includes an increase of $12 million to develop 
accurate baseline soil carbon data and to determine the impacts of 
Federal programs on soil carbon stocks at the national, regional and 
field levels. In addition, NRCS will devote $3 million to fund 
demonstration and pilot projects to test various carbon sequestration 
and greenhouse gas mitigation strategies and monitoring mechanisms.
    Another Administration priority is the need to protect productive 
farmland and preserve open space. The President's Lands Legacy 
initiative will seek to accomplish this through a $50 million increase 
in discretionary spending for NRCS' Farmland Protection Program (FPP). 
Since funding authority for this program was fully expended in 1998, 
the NRCS budget also proposes new CCC legislative funding authority of 
$27.5 million. These two sources of funding for FPP will help meet the 
high demand for this program and ensure that solutions to problems of 
urban sprawl and loss of prime farmland are achieved.
    Rural America is now facing serious economic hardships as a result 
of the declining farm economy. Nevertheless, farmers must still meet 
numerous environmental challenges and this places the greatest burden 
on the smaller operators. To address this, the budget includes $5 
million to more fully implement the Debt for Nature program which will 
provide technical and financial assistance to financially strapped USDA 
borrowers who also have lands that require conservation treatment. At a 
time when many of these small operators are facing foreclosure, this 
program will offer some financial relief while at the same time 
implementing state-of-the-art conservation stewardship practices.
    Funds will again be limited in the watershed planning and 
construction area where allocations will be made only to those projects 
that demonstrate cost effectiveness and clear environmental need. We 
will also work closely with our partners to get a better understanding 
of the overall condition of the more than 10,000 project dams that have 
been installed with USDA funding over the past 50 years. Many of these 
older projects are now approaching the end of their projected life span 
and concerns about public safety are being raised. NRCS will devote $1 
million to providing educational assistance to communities on the need 
to inspect and possibly repair older dams.
    Finally, the Department's 2000 budget will continue to support the 
315 authorized Resource Conservation and Development areas. This 
ongoing program will continue to improve State and local leadership 
capabilities in planning, developing and carrying out resource 
conservation programs.
                   research, education, and economics
    The 2000 budget represents the Administration's first comprehensive 
set of recommendations for investments in agricultural research and 
related technology since the Agricultural Research, Extension, and 
Education Reform Act was enacted in June 1998. The Research Reform Act 
called for a major infusion of funding in research and technology in 
areas that will enable American agriculture adapt to changing 
conditions in the global economy and in the domestic production 
environment. The 2000 budget proposes total funding for the four REE 
agencies of $2.1 billion, an increase of over 10 percent from the 
comparable 1999 level and the first substantial increase for these 
programs since 1992. Advances in research and technology are the keys 
to many of the most challenging problems we face in agriculture today 
and provide the basis for solutions to tomorrow's problems. The 
proposals put the Department in the ranks of the Federal Government's 
leading science agencies.
    The REE budget proposal reflects the priorities outlined in the 
Research Reform Act. Mandatory spending of $120 million in 2000, and 
$600 million over the next 5 years is provided for the Initiative for 
Future Agriculture and Food Systems under Section 401 of the Research 
Reform Act, for competitive research, education, and extension grants 
to address critical and emerging agricultural issues. Grants of up to 5 
years will be awarded to address priority research topics targeting 
enhanced agricultural productivity, food safety and human nutrition, 
and natural resource management. Mandatory funding is also available 
under the Fund for Rural America, where approximately one-half of the 
$60 million total is to be provided for a wide range of research and 
education activities in 2000.
    The 2000 budget of $881 million for the Agricultural Research 
Service (ARS) includes a $51 million net increase for ARS research 
programs above the comparable 1999 enacted level. Within that total, 
the agency will fund increases of $76 million in support of major 
Presidential Initiatives and other high priority research projects. In 
addition, $10 million is provided to partially offset increased pay 
costs. Of the total increase, $35 million will be funded through 
savings achieved from the termination of lower priority projects at 
select locations.
    The discretionary budget request for CSREES of $948 million is up 
by $24 million or 2.6 percent, with a shift within this total to 
programs where funds are distributed competitively to address the most 
critical needs of the agricultural community. The 2000 budget proposes 
an increase of $81 million for the National Research Initiative (NRI), 
a 68 percent increase over the 1999 appropriated level. NRI supports 
both fundamental and mission-linked research through a competitive, 
peer-reviewed process that is open to all of the Nation's top 
scientists, including those at land-grant institutions. The proposed 
increase will target a wide range of environmental, economic, human 
health, and nutrition concerns through additional investments in 
breakthrough research that aims to address the most pressing concerns 
faced by the agricultural community.
    The 2000 budget for the Economic Research Service (ERS) and the 
National Agricultural Statistics Service (NASS), in total, $140 
million, up $6 million from comparable 1999 levels. Increases are 
proposed to support important departmental initiatives while reductions 
reflect the cyclical funding needs for the Census of Agriculture and 
the proposal to fund food program studies through the Food and 
Nutrition Service.
    The budget includes $120 million, an increase of about $25 million, 
for REE research and education in support of the President's Food 
Safety Initiative. Of the total, about $7.3 million is provided to ARS 
for pre-harvest food safety research to study animal pathogen 
resistance to antibiotics, reduce pathogen infestation in animal waste, 
and examine the risks associated with the transmission of zoonotic 
pathogens from animals to humans. The ARS budget includes an increase 
of $4.4 million for post-harvest research to enhance detection and 
measurement of microbial pathogens during handling, distribution, and 
storage of fresh fruits and vegetables to determine the sources of 
contamination and risks of disease transmission. An increase of $3 
million provided in the Cooperative State Research, Education, and 
Extension Service (CSREES) budget for competitive grants for integrated 
research and extension, food safety activities grants will complement 
the ARS research efforts. The extension programs carried out by CSREES 
will provide the necessary training to small retail establishments in 
helping them to implement HACCP. Additionally, about $21 million of the 
total of $200 million proposed National Research Initiative (NRI) 
competitive grants will go for food safety related projects. An 
increase of about $0.5 million is provided to support activities 
carried out by ERS in collaboration with other Federal and USDA 
agencies to assess the costs of foodborne illness and the economic 
implications of different options to improve food safety. An increase 
of $2.5 million is included in the NASS budget for a baseline survey of 
good agricultural practices of fruit and vegetable growers.
    The ARS budget also contains an increase of $8 million for research 
to reduce the incidence of emerging diseases and exotic pests that 
threaten the safety and competitiveness of the U.S. food supply at home 
and abroad. Of the total, about half will be used for developing 
diagnostic tests, vaccines, and other preventive measures to control 
emerging and infectious diseases afflicting animals. The remaining 
amount is provided for research on emerging and exotic plant diseases, 
insects, and weeds that negatively impact crop quality and yield.
    An increase of $3 million is provided in the ARS budget for genetic 
research aimed at enhancing U.S. agricultural competitiveness by 
improving the quality of plant and animal food products. The increase 
is provided to enhance crop production through research on genetic 
vulnerability of plants to pests and diseases and to improve the 
quality and safety of animal products through more accurate information 
on genes responsible for animal diseases and parasites.
    The ARS budget also includes a $20.3 million increase in support of 
the President's Human Nutrition initiative. The overall goal of the 
initiative is to promote health and reduce health care costs by 
identifying the relationship between diet and health and to improve the 
scientific basis for more effective food assistance programs.
    An increase of $3.0 million will support the development and 
application of new technology and management practices to replace the 
traditional pest controls that are at risk of being restricted or 
prohibited due to the Food Quality Protection Act of 1996 (FQPA). Of 
the total, about half of the amount is provided for technical and 
administrative support to the Office of Pest Management and Policy 
which is responsible for coordinating all pest control activities in 
the Department and collaborating with EPA on all pesticide-related 
issues. Additional funding is also provided in the CSREES budget in 
support of FQPA, including $10 million in new funds for long- term 
development and implementation of innovative pest management systems 
for major acreage crops, fruits, and vegetables, and $3 million in new 
funds for the development of alternative pest controls for fruit and 
vegetable crops to replace the pesticides at risk of not meeting the 
new regulatory requirements. The budget includes a proposal for a new 
$5 million program of integrated research and extension grants for 
development of practical management alternatives and technologies for 
commodities affected by the methyl bromide phase-out. Additional 
funding is also provided for a number of programs aimed at preserving 
the Nation's natural resource base. An increase of $11 million is 
provided in the ARS budget for research and development of viable 
management strategies to achieve sustainable ecosystems. Specific 
efforts will include reducing nutrient build-up and transport to 
control hypoxia and harmful algae blooms, developing an Integrated Pest 
Management system for invasive weeds such as melaluca, leafy spurge, 
and yellow star thistle, and developing integrated strategies and 
technologies for conservation and restoration of ecosystems.
    An increase of $15 million is provided for ARS global change 
research activities, with particular emphasis on utilizing management 
and conservation strategies to store carbon in soil, mitigating the 
impacts of climate change on agriculture and food availability, and 
developing new technology for predicting effects of global change on 
management and conservation of natural resources. The ERS budget is 
increased by $1 million for global climate change work, including 
identifying the economic implications of various alternatives for 
reducing greenhouse gases. Funds are also proposed to support USDA 
participation in the U.S. Global Change Research Program National 
Assessment activities in which several agencies collaborate to provide 
better understanding of potential climate changes for the Nation and to 
examine options for adaptations to these changes. An additional $2 
million is provided for ARS research to develop measures to control 
particulate matter in compliance with EPA's new ambient air quality 
standards mandated by the Clean Air Act.
    An increase of $2 million is proposed in the ARS budget so that the 
National Agricultural Library can enhance the availability and delivery 
of information to rural areas through the Internet. Additional support 
is provided to land-grant universities to establish ``Centers of 
Excellence'' on subjects of critical importance to the agricultural 
community, including food safety, pest management, water quality, and 
agricultural productivity.
    The budget also includes $45 million for facility construction and 
modernization projects at 7 ARS locations, a reduction of $12 million 
from 1999. Of the total amount, $13 million is provided to support the 
first phase of a new addition to the Beltsville Human Nutrition 
Research Center and other small projects at the Beltsville Agricultural 
Research Center. Additional funding is also provided for modernization 
projects at ARS regional research centers, including $6 million for the 
Southern Regional Research Center at New Orleans, Louisiana; $4 million 
for the Eastern Regional Research Center at Philadelphia, Pennsylvania; 
$3 million for the Western Regional Research Center at Albany, 
California; and $2 million for the National Center for Agricultural 
Utilization Research, at Peoria, Illinois. Additional funding totalling 
$8 million is also provided for continued modernization of the Plum 
Island Animal Disease Center in New York and $9 million for 
construction of a relocation facility for the Western Human Nutrition 
Research Center in Davis, California.
    Increases are also proposed in the CSREES budget for two innovative 
efforts to empower communities to reduce hunger and improve nutrition 
at the grass roots level. One of my highest priorities as Secretary is 
fostering partnerships between the public, private, and non-profit 
sectors to improve community food security, help individuals move 
towards self-sufficiency, and increase the amount of excess, wholesome 
food that is distributed to hungry Americans rather than discarded. 
Such coordinated efforts are particularly important at a time when 
nonprofit feeding organizations throughout the Nation are reporting an 
increased demand for food, particularly among working poor families. 
For these reasons, $776,000 is proposed to increase technical 
assistance to local anti-hunger and nutrition activities. In addition, 
as part of that initiative, $15 million is requested to increase the 
amount of excess food distributed by nonprofit feeding organizations by 
awarding grants to expand community infrastructures for food recovery 
and gleaning activities. The goal is to increase food recovery by 33 
percent or 500 million pounds, which would provide approximately 
500,000 low-income individuals with 3 pounds of nutritious food a day. 
An increase of $2 million above the 1999 level is also proposed to 
support nutrition education programs aimed at assisting individuals 
below poverty levels in improving basic nutrition and resource 
management practices.
    An increase $4 million is proposed in the CSREES budget for 
competitive research, extension, and education grants to support the 
Small Farms initiative. The main goal of the Initiative is to enhance 
agricultural production on small farms by developing and facilitating 
networks between small farmers and trained professionals in the public 
and private sectors.
    Stable funding is provided for CSREES' higher education programs to 
continue ongoing efforts to support graduate and undergraduate 
education aimed at improving instructional capabilities in food and 
agricultural sciences. Funding is also held constant for the 1890 
Capacity Building Grants Program which supports partnerships between 
the 1890's Historically Black Colleges and Universities and USDA 
agencies to improve research and instruction programs at these schools. 
The budget also continues to support the recommendations proposed by 
CRAT. Proposed increases include an additional $4 million for 1890 
facilities projects for building renovation and construction, an 
increase of $3 million to support 30 additional extension agents on 
Indian reservations in 19 States, and an increase of $1.4 million to 
expand extension capacity at the 30 Native American land-grant 
institutions.
    In addition to the food safety and global climate change increases 
noted previously, the ERS budget includes increases to support economic 
analysis on other priority issues. The budget includes additional funds 
to enhance commodity market analysis, particularly through alliances 
with the land-grant university system, and electronic dissemination of 
this and other ERS analysis to producers, processors, and others that 
use the information. An increase is also included to assess the varying 
information needs of different types of farming operations, how well 
USDA and private information services meet the needs of small farmers, 
and what modification of the Department's current information programs 
are needed to better serve small farmers. Finally, an increase is 
provided to support research on electric utility deregulation in order 
to assess the potential impacts of deregulation on the competitiveness 
of rural businesses, communities, and households.
    The National Agricultural Statistics Service (NASS) is also an 
important source of information that is relied upon by a wide range of 
participants in the agricultural economy. The changes brought about by 
the 1996 Farm Bill make reliable and timely information about 
production, supply and prices even more critical to participants in 
agricultural markets. The budget request for NASS reflects a net 
decrease of $3 million, which includes a $9 million reduction due to 
the cyclical funding needs of the Census of Agriculture. The budget 
includes increases for a number of priority NASS efforts.
    An increase is included to establish a permanent office in Puerto 
Rico in collaboration with the Puerto Rico Department of Agriculture to 
enhance collection of agricultural-related data. Funding is requested 
to conduct the decennial Agriculture Economics Land Ownership Survey 
which provides comprehensive data that are used to assess changes in 
farm structure, farm financial health, land ownership patterns, and 
landlord contributions to agricultural production. An increase is 
included for increased data collection to assist in the setting of safe 
pesticide use standards and in defining good agricultural practices to 
promote food safety. Lastly, an increase is requested to expand 
coverage of the program to measure chemical usage on cropland 
information vital to understanding stresses on cropland and 
environmental changes.
                   marketing and regulatory programs
    The Marketing and Regulatory Programs facilitate domestic and 
international marketing of U.S. agricultural products by: (1) reducing 
international trade barriers and assuring that all sanitary and 
phytosanitary requirements are based on sound science; (2) protecting 
domestic producers from animal and plant pests and diseases; (3) 
monitoring markets to assure fair trading practices; (4) promoting 
competition and efficient marketing; (5) reducing the effects of 
destructive wildlife; and (6) assuring the well-being of research, 
exhibition, and pet animals. Consumers, as well as farmers, ranchers, 
handlers, processors, and other marketers in the agricultural sector, 
benefit from these activities.
    The budget includes an increase of $13 million for the Agricultural 
Marketing Service (AMS) for a number of important activities. It would 
be used to: (1) expand market news reporting; (2) finalize the National 
Organic Program; (3) enhance the rapid response capability of the 
Pesticide Data Program (PDP) necessary to support the Department's 
responsibilities to meet EPA's data requirements for agricultural 
pesticide residues under FQPA; and (4) expand the operating program for 
microbiological testing of fruits and vegetables to support the 
President's Food Safety initiative.
    For the Animal and Plant Health Inspection Service (APHIS), the 
budget proposes a number of significant changes in priorities, but only 
a $10 million overall increase in appropriations for the salaries and 
expenses account. Program successes in brucellosis eradication will 
allow a redirection to higher priority activities such as improved 
animal and plant health monitoring to reduce the likelihood of 
dangerous and costly infestations. APHIS anticipates that all 50 States 
will reach brucellosis Class ``Free'' Status by the end of 1999. The 
budget proposes increased cost sharing from beneficiaries of Wildlife 
Services activities, particularly in States which support less than 
half of the program costs. Also, savings in the APHIS budget for boll 
weevil eradication can be achieved because FSA has established a 
successful loan program to assist producer-operated foundations to 
eradicate this menace to our agriculture. These reductions enable 
budget priorities to increase in the following areas: (1) detection and 
exclusion of pests and diseases including fruit flies, emerging plant 
pests, invasive alien species and Agricultural Quarantine Inspection at 
the borders where upwards of 85 million passengers potentially carry 
banned agricultural products into the United States; (2) more timely 
and accurate surveillance information on animal health; (3) emergency 
preparedness against acts of bioterrorism; and (4) important data 
gathering and risk analysis used in negotiations concerning sanitary 
and phytosanitary trade barriers and restrictions on genetically 
engineered products entering world markets. In addition, legislation 
will be proposed to increase license fees on the entities regulated 
under the Animal Welfare Act to recover the field level costs of 
administering the Act and to increase biotechnology permit fees to 
recover the cost of providing such services.
    The budget requests no net increase for the Grain Inspection, 
Packers and Stockyards Administration. The one-time appropriation of 
$2.5 million in 1999 to restructure the Packers and Stockyards (P&S) 
activities is being used to strengthen P&S programs' ability to 
investigate anti-competitive practices and provide greater flexibility 
and efficiency in enforcing the trade practice and payment protection 
provisions of the Act. In 2000, a similar amount of funds would be used 
to: (1) hire additional staff to monitor and analyze packer competitive 
practices and the implications of structural changes in the meat 
packing industry; (2) expand poultry compliance resources; (3) install 
electronic filing equipment to reduce financial reporting costs for 
stockyard owners and packing house operators, (4) develop new cost-
saving methods of grain inspection, (5) develop specific tests for 
grain varieties, and (6) develop automation techniques for mycotoxin 
testing. Legislation for new license fees from livestock marketing 
firms will be proposed to recover the cost of administering the Packers 
and Stockyards Act and to increase fees for grain inspection to recover 
the cost of developing grain standards.
                   departmental management activities
    Although few support activities have high visibility, they are, 
nevertheless, vital to USDA's success in providing effective customer 
service and efficient program delivery. The 2000 budget proposes a 
number of increases for USDA's central offices and management functions 
to strengthen Departmentwide management oversight, leadership, 
coordination, and administrative support in keeping with the 
Department's Strategic Plan Management Initiatives to: ensure that all 
customers and employees are treated fairly and equitably, with dignity 
and respect; improve customer service by streamlining and restructuring 
the county offices; create a unified system of information technology 
management; and improve financial management and reporting.
    The request reflects a number of priority funding increases to 
continue activities to improve civil rights enforcement throughout 
USDA. In recent years the Congress has increased funding specifically 
for civil rights activities within Departmental Administration. I 
appreciate this support and these activities will continue. The 2000 
budget includes an increase of $3.9 million to build on these 
improvements. I want to be sure that we have the necessary resources to 
meet our Strategic Goal of ensuring that all employees and customers 
are treated fairly and equitably with dignity and respect. The funds 
will support additional staffing in the Office of Outreach to 
strengthen and expand leadership and coordination capabilities and 
expand outreach to minority and limited resource farmers; additional 
staffing for the Office of Civil Rights to handle increased workload in 
discrimination complaints and enhance complaints tracking to provide 
increased accountability; and additional staffing for the Office of 
Small and Disadvantaged Business Utilization to support an ongoing 
project to create new jobs in rural America.
    The budget also includes an increase of $7 million for the 
Department's Socially Disadvantaged Farmers Outreach Program. The 
program, authorized by Section 2501 of the Food, Agriculture, 
Conservation, and Trade Act of 1990, is designed to assist socially and 
disadvantaged farmers and ranchers in participating in USDA programs 
and be successful in their operations by providing outreach and 
technical assistance. The proposed increase will enable support of 
approximately 35 projects that will serve more than 10,000 small 
producers with the goal of turning them into solvent enterprises and 
stemming the continual reduction of the number of minority farmers and 
ranchers.
    The challenge of providing improved customer service with improved 
efficiency as resource constraints are tightened remains a major focus 
of the Department's county-based agencies including FSA, the RD mission 
area, and NRCS. An initial administrative convergence plan has been 
developed to create the Support Services Bureau (SSB) which combines 
the administrative structures of these agencies into one unit to 
deliver better services to local customers and employees, provide a new 
consistency in administrative policy and operations, make better use of 
limited resources, and help preserve limited budget resources for 
program delivery. Thus, the budget includes funding for the new 
consolidated organization, SSB, to provide administrative services, 
including information technology activities, to these agencies. The 
salaries and expenses of the new bureau will be financed through direct 
appropriations and transfers from the serviced agencies.
    The new SSB will support the Department's ongoing Service Center 
Implementation initiative. In 2000, a total program level of $90 
million is proposed to continue Service Center Implementation 
activities, including further development and implementation of the 
common computing environment (CCE). One of the keys to success of 
improved customer service, while streamlining the field structure, is 
the replacement of the aging business and technology systems of the 
field service agencies. A collective re-engineering of business 
processes for administrative services and program delivery is underway, 
along with testing information technology alternatives. Common 
information shared by the partner agencies will reduce the redundant 
requests made of program participants, as well as customer office 
visits and paperwork burden, and ease workload for internal staff. CCE 
will enable the county-based agencies to: optimize the data, equipment, 
and staff sharing opportunities at the USDA service centers; overcome 
the extreme limitations of the current legacy information systems; and 
enhance customer service.
    The Office of the Chief Information Officer (OCIO) provides policy 
guidance, leadership, and coordination in USDA's information management 
and technology investment activities. The proposed increase for 2000 
includes $2.4 million to enhance USDA's infrastructure security and 
OCIO's emergency response capabilities; continue oversight of the 
Department's Service Center Implementation initiative; and continue 
implementation of critical Clinger-Cohen activities including further 
development of the Department's Information Technology Capital Planning 
and Investment Control program, the USDA Information Architecture, and 
workforce planning activities to ensure USDA maintains a highly 
qualified IT workforce.
    Supplemental funding of $37.8 million was provided to OCIO in 1999 
to support an aggressive program of remediation activities to address 
Year 2000 computer and embedded chip problems in the Department. I 
appreciate this support provided by the Congress and we are diligently 
working to ensure uninterrupted delivery of USDA programs and services 
in 2000.
    The Office of the Chief Financial Officer provides overall 
direction and leadership in the development of modern financial 
management structures and systems in the Department. The budget 
proposes an increase of $2 million to restore the Department's 
financial credibility and accountability including successful 
implementation of legislative mandates such as the Government 
Performance and Results Act, debt collection and cost accounting. 
Increases in the Department's Working Capital Fund will enhance 
implementation of our new USDA-wide financial accounting system.
    The Office of the General Counsel (OGC) provides critical legal 
support and advice to the Department and its agencies. An increase of 
$3.5 million is proposed to strengthen OGC's ability to provide timely 
response to requests for legal assistance, especially in the areas of 
trade practices, natural resources, and general law. Funds area also 
included to provide information technology improvements to enhance the 
efficiency of the office.
    The Department's Office of Communications (OC) plays a critical 
role in disseminating information about USDA's programs to the general 
public. The request includes an increase of $1.2 million to enable OC 
to utilize new technology to reach audiences in a more timely and 
effective manner, and to lead Department-wide communications outreach 
efforts to reach underserved populations.
    The request includes additional funds to continue the ongoing 
implementation of the USDA Strategic Space Plan for the Washington 
Metropolitan area. This plan has been tailored to meet the needs of 
USDA based on the projected staff levels at the Washington Headquarters 
and to provide a safe, efficient workplace for our employees. Occupancy 
of the Beltsville facility is scheduled to be completed during 1999. 
The work required in the renovation of the South Building includes fire 
protection systems, abatement of hazardous materials such as asbestos; 
replacement of old, inefficient heating, ventilation and air 
conditioning systems; upgrade of electrical and plumbing systems; 
improved accommodations for disabled persons; and accommodation of 
modern telecommunications systems. The construction contract for Phase 
1 of the modernization was awarded in July 1998. The design for Phase 2 
is substantially complete and the 2000 request includes funds for the 
construction of Phase 2.
    The Department's Hazardous Waste Management program provides 
leadership and funding for compliance with the requirements of the 
Comprehensive Environmental Response, Compensation, and Liability Act, 
the Resources Conservation and Recovery Act, the Oil Pollution Act and 
the Pollution Prevention Act for facilities and lands under USDA's 
jurisdiction. An increase of $7 million is requested to minimally 
comply with necessary investigative and cleanup activities to protect 
human health and the environment and support increased efforts to 
identify and bill other responsible parties in the cleanup of hazardous 
waste sites.
                      office of inspector general
    The Office of Inspector General (OIG) conducts and supervises 
audits and investigations relating to programs and operations of the 
Department, reviews and makes recommendations on existing and proposed 
legislation and regulations, and recommends policies and activities to 
promote economy and efficiency and to prevent and detect fraud and 
mismanagement in USDA operations. The budget includes an increase of 
$3.1 million to maintain these activities and enhance the information 
technology capabilities of OIG.
    That concludes my statement, I am looking forward to working with 
the Committee on the 2000 budget so that together we can meet the needs 
of our clients.

    Senator Cochran. Mr. Secretary, we appreciate this overview 
of the budget submitted for the Department of Agriculture, and 
we will endeavor to work closely with you and the Department to 
help solve these problems in agriculture and make sure that we 
put the money where the problems are and help ensure that the 
programs are administered efficiently and effectively.

                         CROP INSURANCE REFORM

    In that connection, I noticed that you mentioned some farm 
bill shortcomings and specifically addressed the problem of 
crop insurance reform as something that needs to be undertaken. 
It is troubling, therefore, to observe that there is no money 
in this budget request for crop insurance reform. A white paper 
is not going to be enough in my judgment to solve the problem. 
We all know a good bit about the problem, but we need to have 
some more definitive work and proposals from the administration 
to consider in the Congress and specifically a budget request 
that will provide funds to help fund a crop insurance reform 
effort. What is your reaction to my comment on that?
    Secretary Glickman. Well, Senator, I think it is a fair 
question. I would say this, that this is a multi-billion dollar 
problem. We talked about whether we should put a placeholder in 
the budget and then find enormous offsets other places in the 
budget to pay for it, perhaps significantly reducing existing 
farm program payments or other parts of the USDA budget. And we 
decided, no, because we are really talking about a replacement 
for the disaster programs that we have every year.
    In the late summer/early fall, this Congress responded with 
first $4 billion. The President vetoed the bill, and Congress 
responded with $6 billion of emergency payments, disaster 
payments that were not heretofore budgeted because they were, 
in fact, true emergencies.
    While the crop insurance issue is not a classic emergency 
from the standpoint of the budgeting requirements, we have 
taken the position that, in effect, it is very much like that. 
So, we want to work with Congress to see if we can come up with 
a substantive legislative proposal that would effectively more 
truly replace the ad hoc disaster assistance proposals, and if 
we do that, I am confident that we will come up with the 
offsets that will pay for it.

                      SUPPLEMENTAL APPROPRIATIONS

    Senator Cochran. I noticed also that you mentioned the 
possibility of a supplemental for programs, specifically loan 
programs where there are not enough monies available now to 
meet loan application requests that are coming in for farm 
operating loans or ownership loans, guaranteed and direct 
loans. There is not included in this budget request any 
supplemental requirements for fiscal year 1999 even though, as 
you state, the need is obvious, and I think you said shortly 
some of these programs will be running out of money.
    How much is needed for these farm operating and guaranteed 
loan programs, and are there other needs for which will be 
submitted in a supplemental request? If so, when will it be 
submitted, and how much will it request?
    Secretary Glickman. I am going to ask Mr. Dewhurst to 
respond specifically, but I would say this, that we will run 
out of funding for emergency loans fairly soon.
    The funding for farm loans did increase from $2 billion in 
fiscal year 1998 to $2.8 billion in 1999 to $3 billion in 2000. 
Demand is outrunning our funding.
    Funding for guaranteed operating and ownership loans will 
be exhausted in the next few weeks. What is happening is a lot 
of producers and a lot of banks are turning to us to help 
refinance existing debt as prices fall. We are either the 
lender of last resort or our guaranteed program has become 
extremely popular with banks who might not heretofore have 
wanted to use us in some of these loans.
    But perhaps Steve may want to comment more specifically on 
that.
    Mr. Dewhurst. Well, as the Secretary said, we are looking 
at the needs for supplemental appropriations with the hope that 
we will be sending something forward in the executive branch in 
the next few days. There are essentially four program areas we 
are looking at. One is the one that Senator Cochran brought up, 
which is farm credit. It is clear to us that with respect to 
emergency loans, as well as with respect to guaranteed 
operating and ownership credit, there are shortages in all of 
those areas. The current estimate of need could be as much as 
$1 billion in loan authority, which translates into roughly 
$100 million in budget authority to finance them.
    But I want to emphasize that one of our problems is these 
numbers keep changing and we are trying to get the best numbers 
we can to make sure we cover the problem.
    We are also looking at the emergency conservation program. 
As you know, that program runs through the Farm Service Agency 
and provides farmers with some cost-share money to put land 
back in productive condition following natural disasters. We 
are working with a tentative estimate of about $30 million in 
that area. At the moment the largest single need that we see is 
in Puerto Rico due to Hurricane George. There is an $8 million 
requirement in that territory alone because of hurricane 
damage.
    We are also looking at the emergency watershed program. The 
Natural Resources Conservation Service works with local 
jurisdictions to clear channels and restore streams after 
natural disasters. They have given us an initial estimate of 
roughly $100 million, but we are still looking at that.
    Finally, there's rural development. We have some housing 
needs due to natural disasters again in Puerto Rico, as well as 
a number of other States where storms have damaged USDA 
financed rural housing, and there may be a need for us to 
provide some additional loans and grants to help restore that 
housing. That is a fairly small area. We think it might amount 
to $6 million in loans and grants.
    So, those are four areas we are looking at. We do hope to 
have something forward the next few days, but we are trying to 
get the best numbers that we can.
    Senator Cochran. Thank you.
    Senator Kohl.

                         LONG-TERM DAIRY PRICES

    Senator Kohl. Thank you, Senator Cochran.
    Mr. Secretary, dairy farmers in my State of Wisconsin and 
across much of the Nation have recently benefitted from good 
prices. However, we are very concerned about projections for 
dairy prices in the coming months. I would like you or perhaps 
Mr. Collins to provide your views on the near and long-term 
prices dairy farmers may expect to receive.
    Secretary Glickman. Well, if they were going up, I would do 
it, but I am going to have Mr. Collins respond. [Laughter.]
    Mr. Collins. Thank you, Mr. Secretary.
    Secretary Glickman. I think last year I did do it.
    Senator Kohl. They were going up.
    Mr. Collins. Mr. Kohl, as you did comment, we have had an 
unusual situation over the last couple of months. The basic 
formula price in December was $17.34 per 100 pounds of milk 
which was an all-time record high. I do not think many people 
expected that to continue; at least not many economists 
expected that to continue.
    In 1998, we had some serious weather problems that affected 
milk production around the country, California in particular, 
having wet weather in the spring and then drought during the 
summer. We only had a very small increase in milk production at 
a time when cheese demand was strong and milk fat demand was 
strong.
    Over the last 3 months of 1998, though, things have started 
to change. Milk production was up 2 percent. That is the first 
sustained increase we have had in milk production since 1995. 
As a result of that, we are now seeing more cheese production, 
and we have seen cheese prices drop rather dramatically. They 
were record high, $1.90 a pound in December. They fell all the 
way to $1.25 the third week in January, and they went up a 
little bit last Friday to about $1.32.
    But as we look out, we are probably going to see a basic 
formula price, when we announce it on March 5th, dropping to 
the range of between $12 and $13 per 100 pounds, down from the 
$17.34 record in December, and I think we announced about 
$16.28 last week for the January basic formula price.
    Just to finish this, for the year as a whole, we would see 
the basic formula price average about $12.75 per hundredweight 
in 1999 which would be down from about $14.20 in 1998. But it 
would be better than what we had in 1997 when it was only 
$12.05, and producers will face lower feed costs than they did 
in 1997. So, we should have a year about between the last 2 
years of 1997 and 1998.
    Senator Kohl. All right. So, we are expecting a serious 
decline in prices this year relative to last year.
    Mr. Collins. Yes, sir.

                           EMERGENCY FUNDING

    Senator Kohl. Last fall, Mr. Secretary, Congress provided, 
as you know and stated, nearly $6 billion in emergency funds to 
bolster farm prices. Included in that amount was $200 million 
to help dairy farmers. In fact, Mr. Secretary, I have written 
you a letter, as you know, on this matter.
    Since Congress has already acted and an economic disaster 
for dairy farmers is expected in the near term, can you assure 
dairy farmers in Wisconsin and other States that that money 
will be available and will be used to offset the effects of the 
crisis that we expect?
    Secretary Glickman. Yes. This $200 million fund needs to be 
out there sometime mid to late spring. We have not yet 
finalized the formula for doing it, but the appropriations bill 
requires us to spend $200 million and I am advised that it has 
got to be spent this fiscal year. So, that means the money must 
and will be spent.
    The other thing I would tell you is that without knowing 
exactly what we are going to do on dairy, we did do the $50 
million hog program which was kind of a special program. On 
that one, we targeted it to basically smaller and mid-size 
producers. While we have not finalized the dairy program yet, 
it would be my hope that there would be some targeting in this 
area as well.

                          MARKET CONCENTRATION

    Senator Kohl. All right. Mr. Secretary, you have noted in 
your remarks your commitment to the small farmer and ongoing 
efforts at USDA to help ensure that highly concentrated market 
power in the hands of a few will not serve to the detriment of 
the American farmer or the American consumer. Mr. Secretary, if 
concentration within the U.S. agriculture sector continues to 
grow, what do you see as the long-term consequences of this 
concentration?
    Secretary Glickman. That is a question that I am very 
worried about. It is the question that I get when I am out in 
the country more than any other question. It has to do with the 
structure of agriculture, particularly in the livestock sector, 
particularly in poultry and hogs, but there is also a lot of 
concern about ownership on the slaughter side, the beef side of 
the picture.
    Now, we have, to use the colloquial expression, beefed up 
our enforcement and our staffing functions of the Grain 
Inspection and Packers and Stockyards Administration. It is in 
our budget to provide more resources to do both studies and to 
take on cases. These cases, antitrust cases, are very 
complicated and they are intensely litigious.
    One of the first things that I did when I came on board is 
we sued IBP, the largest meat packing company in the world, for 
preferential pricing practices. We got a result which was 
partially positive, partially negative, but it is something 
that we need to do more of, which is to challenge unfair 
practices where they exist. We have our own statute, the 
Packers and Stockyards Act, which was adopted as basically an 
unfair practices statute.
    We also created a National Commission on Small Farms. It 
has made several recommendations that we have implemented.
    I would also point out that in recent weeks the White House 
has put together a team of us and the Department of Justice to 
examine larger consolidation issues involving agriculture. 
Senator Harkin and others have been asking that we do that as 
well.
    But there is some additional money for enforcement of our 
Packers and Stockyards Act.

                        CONSERVATION FARM OPTION

    Senator Kohl. Mr. Secretary, Wisconsin is a State rich in 
natural resources. In fact, by reasonable accounts, modern day 
conservation was born in Wisconsin.
    Today, however, we face serious challenges to water quality 
and soil degradation from many sources, including agriculture. 
I note the budget request calls for increases in many important 
conservation programs, but at the expense of some others. For 
example, we note that the Conservation Farm Option program is 
not funded at all, even though farmers in Wisconsin have been 
asking for this program since passage of the 1996 farm bill.
    Can you explain why you chose new conservation programs 
over ones not yet funded, such as the Conservation Farm Option?
    Secretary Glickman. I believe, if I am not mistaken, 
Congress cut the funding for this program last year. So, quite 
frankly, the administration made its priorities based on a lot 
of factors, including that. But we think the Conservation Farm 
Option is an important program and we certainly would not 
resist Congress putting money into it.
    Senator Kohl. Thank you.
    Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator Kohl.
    Senator Bond.
    Senator Bond. Thank you very much, Mr. Chairman.
    Mr. Secretary, I am glad to hear you are going to be 
focusing on the concentration issues because those are of great 
concern to us.
    I appreciate also your strong support for research which is 
the future.
    I would share the chairman's concern about the failure to 
come forth with a plan, any plan, on crop insurance and begin 
to make a realistic budget set-aside for that. To be quite 
harsh, Pro Farmer I read says, basically USDA has punted on 
crop insurance reform. They have laid the entire matter at the 
feet of Congress. I do not want to be harsh, but there is that 
view.

                          SUPPLEMENTAL REQUEST

    I would point out one other thing that we are concerned 
about. When you talk about the supplemental requests, I hope 
that you will also be providing us with your suggested offsets. 
The President has said we are going to save Social Security by 
devoting the surplus to it, and certainly we would not expect 
to have supplemental requests that are not funded.
    With respect to the program you addressed, disaster 
assistance, Congress did provide $2.4 billion to compensate for 
crop losses and it was signed 100 days ago. There are some who 
do not think the $2.4 billion is enough. But we still do not 
have a signup and farmers are asking when they can have the 
assistance in hand.
    What is the target for getting that ready?
    Secretary Glickman. The signup did actually start I think 
last week, February 1.
    Senator Bond. We do not have the information. Our offices 
do not have it. I mean, that is what we are hearing from back 
home. They do not have that.
    Secretary Glickman. Well, we will make sure that the 
Missouri State office has all the information by this 
afternoon.
    But the signup started. Again, this is different than the 
first part of the $6 billion program of assistance where we 
just could send checks based upon previous farm programs. In 
this case, farmers have to come in to the county offices and do 
the appropriate amount of paperwork and provide proof of loss. 
We are trying to minimize paperwork as much as possible. We 
just added some California relief based upon the freeze as 
well, and then you have to allocate the total dollars based 
upon the total amount of applications. But we need to get that 
relief out this spring, late winter or early spring certainly.
    Senator Bond. Well, we appreciate your doing that, and I 
would put in a good word for the USDA organization in our 
State. They are doing a good job.

                    COTTON LOAN DEFICIENCY PAYMENTS

    On a parochial matter, I need to call to your attention to 
the fact that there are over 1,000 appeals awaiting decisions 
in response to a USDA mistake inadvertently in implementing the 
cotton loan deficiency payments down in the Boothill in 
southeast Missouri. Apparently the local FSA did not get word 
from Washington, and we need FSA to allow form CCC-709 to be 
amended. You have been hearing from a lot of people about that. 
It is one of those technical difficulties. If you can get that 
solved, you will be a hero in the Boothill and we all will. We 
appreciate your looking at that.

                      FOOD QUALITY PROTECTION ACT

    One final challenge for you that I offer up to you for any 
comments you have. On the off chance that you have some 
influence over Administrator Browner at the EPA, since Congress 
does not seem to have any, I would ask if you are able and 
willing to speak the language of science and agriculture in EPA 
regarding the implementation of the Food Quality Protection 
Act. Is USDA participating? Are you making the science and the 
agricultural knowledge that you have available in a meaningful 
way in the discussions at EPA with respect to FQPA?
    Secretary Glickman. The answer is yes. And Senator, I am 
going to ask Deputy Secretary Rominger to comment on this, but 
let me just make a couple of points.
    One is that the Deputy Secretary and I met with Carol 
Browner last week for almost 2 hours to discuss the practical 
implementation of the Food Quality Protection Act. This is a 
concern out in the countryside: Is USDA engaged as we deal with 
pesticides and organophosphates and other things that either 
have to be removed or usage changed or modified? I am extremely 
comfortable with our relationship with the EPA and Carol 
Browner. In the countryside sometimes when I say that, people 
kind of say, well, we are hearing other things, but it is not 
true.
    The other thing. This is a statute that is extremely 
complicated. It is a statute--at least in the initial 
implementation--which is basically a child-based statute. That 
is, the things to be removed from the marketplace are those 
things that affect children as they consume foods like apple 
juice and other kinds of things.
    So, it does require a great deal of good, sound, objective 
science, and we have the best scientists in the world at our 
Agricultural Research Service and they will be used. I can 
promise you that.
    Senator Bond. Well, Mr. Secretary, we are delighted to hear 
that assurance, but as you know, I am from Missouri and so the 
only thing we have got to say is, show us and we will look 
forward to seeing----
    Secretary Glickman. Perhaps the Deputy Secretary may want 
to respond.
    Senator Bond. OK.
    Secretary Glickman. He has been more involved in it too.
    Mr. Rominger. We are involved with EPA. We have been 
involved and we will continue to be involved. I co chaired the 
advisory committee that we set up. I co chaired it with the 
Deputy Administrator of EPA. And that was a 50-person advisory 
committee and agriculture is well represented on that 
committee. We had several meetings last year. We will be 
scheduling another meeting soon.
    Our scientists are involved in this reassessment and EPA 
will soon be coming out with the first of what we call the 
refined assessments. They put out some preliminary risk 
assessments. That did not include our information, but they are 
now using our information and will be coming out with some 
refined assessments. We believe those assessments will look 
much better from an agricultural viewpoint, although I think we 
all recognize there are going to be some uses of some of these 
materials where we are going to have to look at ways to 
mitigate some of the exposures that are out there.
    Senator Bond. Well, I thank you. We just expect that sound 
science be used. We will be counting on you and we will be 
watching.
    Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator Bond.
    Senator Bond. Thank you, Mr. Secretary.
    Senator Cochran. Senator Harkin.
    Senator Harkin. Thank you, Mr. Chairman. I apologize for 
being a little late.

                      SUPPLEMENTAL APPROPRIATIONS

    Mr. Secretary, I understand you made some statement earlier 
about a supplemental. Could you just cover that for me briefly? 
I hate to have you go over it.
    Secretary Glickman. Well, we have not yet made a formal 
request to OMB for supplementals. So, I want to make it clear.
    But what I did say was in the area of farm loans we are 
close to running out of emergency loan money. We also have 
needs in guaranteed loans and some of our direct loans. It 
could be as high as $1 billion worth of loans, which has a 
budget exposure of about $100 million. We do not have the 
absolute final numbers yet. Steve says it will be about a week 
or so. But that would be one of the things we would need to 
have.
    The reason for that is that the utilization of our loan 
programs keeps going up because, as you know, we are the lender 
of last resort. More and more banks come to us because they 
want our guarantee. Prices have not been so hot. The collateral 
has not been as good, and so people have been coming to us in 
greater numbers.
    Then Steve mentioned a few other things such as emergency 
conservation, emergency watershed, and rural development. Most 
of that is related to disasters in Puerto Rico and some other 
natural disasters.
    I would mention one other thing. The fact of the matter 
is--and I said this before--that when we passed the 1996 farm 
bill, we did not expect prices to tumble--well, some did not 
expect prices to tumble quite as aggressively. Nobody would 
ever want that to happen. That triggered the loan deficiency 
payment.
    Senator Harkin. That is right.
    Secretary Glickman. And we anticipated initially virtually 
no applications for LDP's. We will have 1.3 million 
applications for LDP's. Mind you, that is farmer X going into 
the local office and saying, I need this program and I need 
this assistance. Some are saying that that could increase if 
soybean prices fall and other kinds of things happen. So, in 
many parts of this country, we are faced with a situation now 
where there are lines of farmers seeking assistance. There is a 
waiting period. People are not getting their program payments 
as fast as they would like. And this is not just only in the 
FSA. It is also in the NRCS because of the increased workload 
required under the 1996 farm bill as well.
    Now, I do not know if that is going to be part of a 
supplemental or not, but I did want to tell you that--and a lot 
of these problems have been created in the last 2, 3 months. 
They have really become much worse.
    Everybody hopes prices will move back up. It is hard to 
plan a budget anticipating declines. Nobody wants to see that, 
but we have got to serve people because as problematic as some 
of the provisions of the 1996 farm bill are, this LDP provision 
does protect people against catastrophic reductions in market 
prices, and we have got to be out there providing those 
payments.
    Senator Harkin. I appreciate that, Mr. Secretary. Again, I 
urge you to do that with all dispatch. I am hearing more and 
more from out in Iowa that the farmers' balance sheets, when 
they go into the local bank, just do not add up because of 
these depressed prices and the forecasts. So, I think you are 
going to have a big demand for this coming up. So, I just hope 
that you would send a supplemental request up here as soon as 
possible, knowing that it takes us a while to get things done 
here too. But I would think February, March--man, we have got 
to hurry and get that done. But I appreciate your focusing on 
that and I just hope that does come up here.

                          PSEUDORABIES PROGRAM

    Let me again compliment you, Mr. Secretary, on responding 
as vigorously as you have been to the problems in the pork 
industry. First of all, I again commend you for what you have 
done on the pseudorabies program. That is three bangs for the 
buck there. Not only do you get rid of some hogs--it helps 
market prices--but you help more States to become pseudorabies 
free. That saves farmers a lot of out-of-pocket money. And 
third, it enhances our exports especially to Canada where I 
know you have also done some great work in getting the 
Canadians to back off of their quarantine. I believe that has 
already happened, if I am not mistaken.
    Again, I compliment you for that, to get that done, which 
you have done also with Argentina in getting more exports to 
Argentina. Both the Canadian and the Argentine issue you have 
handled very well, and we really appreciate it very much.

                          MARKET CONCENTRATION

    On the issue beyond that of concentration and stuff, I 
think our authorizing committee is really going to have to 
really take a look at this and see what we want to do about 
this whole issue of concentration. Again, it comes back to the 
price reporting. If you are going to have a market that 
operates, it seems to me it has got to be transparent. I have 
always said for a free market to operate, you have got to have 
a lot of players and it has got to be transparent. Otherwise, 
you do not have a free market. So, what do we have now in 
agriculture? A few players and no transparency. How can that be 
a free market?
    So, I am hopeful that we can do something to provide for 
price reporting. Now, we had that in the bills last year and it 
did not make it. I am hopeful that we can get something done on 
it soon. Some people say, well, it may not do that much. Well, 
I am not so certain. It may do quite a bit. I mean, anything. 
If it adds up to just a few pennies a pound, that is not bad. 
Everything helps to get that price of pork up and give the 
farmers a little bit better shake.
    I just saw the article in the Wall Street Journal the other 
day that said that IBP's profits for the fourth quarter 
quadrupled. I am preaching to the choir, but I mean, you know 
how that rubs farmers. Their profits quadrupled and here 
farmers in December in Iowa got the lowest prices for their 
pork than they got even in the depression. If you factor in 
inflation, they got lower prices for their pork than what my 
father used to tell me about 4 cent hogs, nickel hogs. That is 
true.
    We figured this out, Mr. Chairman. We had 8 cent hogs in 
December. Well, in the depression, the lowest was 4 cent hogs. 
But if you factor back for inflation, take that 8 cents back, 
in 1933 prices, it would have been two-thirds of a penny a 
pound. That is just mind-boggling when you think about it.
    All the things you are doing, I am just saying, Mr. 
Secretary, are good and it is moving us in the right direction. 
If we can get the price reporting and get your help on this 
concentration issue to move that ahead also.
    On the cash assistance, now you did do something that you 
have not done for a long time, and that is give direct cash 
assistance to pork farmers. That is good. To the small ones, 
they needed that. But I know the pot is not an endless pot 
there. I assume we cannot expect any more. I do not know. Can 
you speak to that? I do not know how much more we could expect 
on that.
    Secretary Glickman. Certainly it would not be prudent to 
expect any more out of that particular pot of money. This is 
section 32, a statute that was passed in the depression. Most 
of that, of course, is what we use to buy product that is in 
surplus supply for our commodity distribution programs, such as 
the National School Lunch Program.
    The language in one of the parts of that legislation says 
that I can basically go out in the marketplace and buy surplus 
commodities or can use the authority of the program to make 
payments to farmers. I think the section indicates that one of 
the things I can do is reestablish farmers' purchasing power by 
making payments in connection with the normal production of any 
agricultural commodity for domestic consumption. Determinations 
by the Secretary as to what constitutes diversion and what 
constitutes normal channels of trade and commerce and what 
constitutes normal production for domestic consumption shall be 
final. A different era. [Laughter.]
    But section 32 is primarily used to purchase commodities. 
So, we used about $50 million worth of it for direct payments 
to farmers. We have been criticized in some sectors for not 
coming up with enough money, but quite frankly, we have got to 
reserve most of that for the purchases for our programs, our 
nutrition programs.
    Senator Harkin. Sure, sure.

                          SBA RURAL ASSISTANCE

    Last, Mr. Secretary, I remember back in the 1970's--I may 
be off a little bit. Have your people research this. SBA got 
involved with helping farmers with USDA. I do not exactly know 
how that arrangement was set up. Some of your historians or 
something could tell you that. I will get my staff looking at 
it too. But SBA came in in the 1970's and helped farmers out, 
and it was some kind of a joint effort between SBA and USDA.
    Now, what I am thinking about here and what I am getting at 
is that not only farmers are hurting, but we have got a lot of 
retail stores in our small communities and stuff that are 
facing the same kind of balance sheet problem as farmers. And 
it is not just implement dealers. It is a lot of other 
ancillary type of businesses that relate to the rural sector. 
Now, they are going to their banks and their banks are saying, 
gee, you are not looking too good here.
    So, while it may take a while for us--I hope not. We hope 
that prices come up very rapidly, but we have to be realists 
about this and understand it may take some time. Is there any 
kind of arrangement that can be made with SBA--and I do sit on 
the Small Business Committee. Senator Bond heads that 
committee--to see if there may not be some role for SBA to play 
not so much for farmers but with these retail businesses in 
these small communities and for USDA to work with them on it.
    I just throw that out there. I do not know.
    Secretary Glickman. Well, I think it is a good suggestion. 
James Lee Witt, head of FEMA, who has done a tremendous job of 
dealing with disasters, tells me that SBA has much more 
authority, lending authority in the case of disasters, in terms 
of who they can lend to than we do. For example, we cannot make 
a business loan as much as they can. They cannot lend to 
farmers. There is a regulatory kind of hold there. He has 
repeatedly said it is something that may need to be fixed 
legislatively.
    I would have to say that we did announce, actually earlier 
this week, a new rule making it easy for banks to become 
preferred lenders from the standpoint of participating in our 
guarantee programs. They would not have to go through a lot of 
the paperwork. It was alleged--and it was a fair allegation--
that we put banks through much greater hoops than SBA did in 
terms of qualifying for accelerated assistance, and we did make 
some changes there this week.
    Senator Harkin. I appreciate that.
    I just think, Mr. Chairman, Mr. Secretary, if there is some 
way that we--I am going to have a look at that. I think it was 
1977 or 1978 or somewhere in that range. It had to be because 
that is about when I got here and I remember that. The 1977 
drought my staff tells me. So, we ought to see if there is some 
model there that we can use. That is all I suggest to you.
    But, again, thank you for all the help you have been to our 
pork farmers. I appreciate it.
    Secretary Glickman. We will research that as well.
    Senator Harkin. Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator.

                           RURAL DEVELOPMENT

    Mr. Secretary, one area that you mentioned in your remarks 
and that I have a great interest in as well because of our 
State's dependence upon rural communities and infrastructure in 
small towns, and the problems that go along with trying to 
sustain that infrastructure, is the availability of money for 
water and sewer systems. That is very important in our State 
and throughout the country.
    I am curious to know whether we are taking into account in 
the administration of these programs the deterioration of some 
of the systems that have been in place for a number of years 
now. In our State, we are seeing maintenance problems develop, 
the need to replace parts of systems that are just flat worn 
out. Are we doing anything in the administration of these 
programs to try to deal with those problems and help rural 
communities refinance or modernize these systems? We still have 
some areas where they do not have systems, and I am not 
suggesting that we ignore those, but this maintenance problem 
and the deterioration of existing systems is getting severe in 
a number of areas in our State.
    Secretary Glickman. The short answer is yes. The repair and 
modernization of old systems is one of the priorities. But I 
will have to tell you I am going to go back and talk to our 
Under Secretary Jill Long Thompson to see about the specific 
targeting in this area. Once you get a system that is 20 or 25 
years old, built with our money, it may need a heavy dose of 
repair, and if we have this extra money this year because of, 
as I said, the interest rate phenomenon, it may be appropriate 
for us to examine some sort of a major repair initiative. I 
would like to talk to her about it. She may have something in 
mind there.

             FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM

    Senator Cochran. One area in your statement you did not 
talk about was the change in the funding of some of the 
marketing programs overseas. The Cooperator program for 
example, instead of funding it through the Foreign Agriculture 
Service, you are proposing legislation to shift that to the 
Commodity Credit Corporation. The budget proposes some other 
changes of that kind.
    Are we at a point now where the decision is being made that 
exporters and the private sector can do this on their own, or 
is the Department of Agriculture just slowly backing out of its 
partnership with farmers and exporters to try to increase 
market share abroad and make sure our export programs are being 
treated fairly in foreign markets?
    Senator Bond talked about the beef problem in the European 
Community.
    It seems to me that rather than doing less in this area, we 
need to look for ways to do a better job and a more aggressive 
job expanding markets and increasing market opportunities 
overseas.
    Secretary Glickman. Well, again, I think it is a fair 
question, and the answer is no. It is not an intention to do 
less. The fact is that it is a dog-eat-dog, competitive world 
out there, particularly when prices are so weak.
    I would like Mr. Dewhurst to respond specifically to your 
question on the funding of this program.
    Mr. Dewhurst. Well, as you have said, the discretionary 
budget in the Department is under great pressure, and one of 
the proposals made in this budget is to take the FAS Cooperator 
program which has been funded on the discretionary side of the 
budget and ask the Congress to pass some legislation which 
would have the effect not of cutting the program, but of simply 
moving the funding for it to the mandatory side of the budget, 
funded out of the Commodity Credit Corporation from year to 
year.
    The logic for that is simply that the Cooperator program is 
part of our overall export portfolio and the vast majority of 
that portfolio is already financed out of the Commodity Credit 
Corporation. So, it seemed a logical step to move the 
Cooperator program over there and the truth is it would just 
relieve some pressure on the discretionary budget.

                       COCHRAN FELLOWSHIP PROGRAM

    Senator Cochran. There is one program that you usually 
mention but you did not this year, and I wonder if there is any 
problem. Did you fund the Cochran fellowship program in this 
budget request? [Laughter.]
    Secretary Glickman. I certainly hope so. [Laughter.]
    Mr. Dewhurst. It is unanimous we did.
    Secretary Glickman. Yes.
    Senator Cochran. I think Mr. Dewhurst said it is unanimous 
you all hope you did. [Laughter.]
    Secretary Glickman. As a matter of fact, I have to tell you 
that I have met personally several Cochran fellows. I am going 
to go back to South Africa next week. The Vice President has a 
joint meeting with Mr. Mbeki. It is one of the places where we 
have used the program most aggressively. The budget numbers are 
actually up slightly, or am I wrong?
    Mr. Dewhurst. The Budget is about the same. We have $3.5 
million requested in appropriations for that program which is 
the same level as fiscal year 1999. We also add some Commodity 
Credit Corporation funding to that program and some funding we 
get from AID over in the State Department, so that the total 
program is $6.3 million in the 2000 budget.
    Senator Cochran. That is good.
    Tell me about your South African experience.
    Secretary Glickman. Well, there was a young man who came 
over to this country to learn about viticulture and went back 
to South Africa and now operates I think a successful vineyard. 
That is just one example of how this program created an 
entrepreneur in South Africa, and I am sure it is replicated in 
other places.
    Senator Cochran. With close business ties to the United 
States now.
    Secretary Glickman. That is correct.
    Senator Cochran. Well, I think that is the purpose, to try 
to help develop closer relationships between people who are 
getting involved in agriculture and agribusiness operations, 
developing ties with them, letting them know how our system 
works, free enterprise, the market-oriented economic system. 
Hopefully this means closer cooperation and friendlier 
relations throughout the world, particularly in developing and 
emerging democracies.
    Eastern Europe is another example of an area where the 
program has been very popular, and we have had a large number 
of people come from Poland and other countries to the United 
States, spend a few weeks or several months, or for whatever 
period the program allows these individual applicants to 
participate. And then they take with them these experiences, 
and it has a catalytic effect in their home communities. That 
is what we have learned in the past.
    We appreciate your support.
    Mr. Rominger.
    Mr. Rominger. I just wanted to add that it is a very 
popular program. The Minister of Agriculture from Romania was 
just here this week, and that was one of the things that he 
asked about, whether they could participate in the program 
because they have heard about it and would like to participate 
as they try to move more to a market oriented economy.
    Senator Cochran. That is good to hear.

                     ADDITIONAL COMMITTEE QUESTIONS

    Well, thank you very much for your attendance and your 
cooperation with the committee and the presentation that you 
made so we can more fully understand this budget request.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted by Senator Cochran
      usda information management systems/support services bureau
    Mr. Secretary, your prepared statement indicates that the statutory 
cap on Commodity Credit Corporation (CCC) expenditures for computer 
equipment will be nearly exhausted by 2000 ``preventing needed 
investments in the Department's streamlining and Service Center 
initiatives and prohibiting the Department from investing in much 
needed technology for business process re-engineering efforts''.
    The budget requests an appropriation of $74 million for computer 
investments of the proposed new support Services Bureau, that the 
remaining $16 million in CCC expenditures under the existing cap be 
transferred to the Bureau, and that legislation be passed to raise the 
limit on CCC expenditures for computer equipment by a total of $105 
million for the next three fiscal years.
    Question. Would the $16 million in available CCC funds be greater 
had the Department not proposed to reduce these funds in order to pay 
for the cost of waiving the statute of limitations for certain 
discrimination cases filed against the Department?
    Answer. The 1996 Farm Bill set a cap of $275 million for CCC-funded 
ADP obligations for fiscal years 1997 through 2002. Subsequently, the 
Agricultural Research, Extension, and the Education Reform Act of 1998 
reduced the CCC ADP cap to $193 million. The fiscal year 1999 
Appropriations Act again reduced the CCC ADP cap to $188 million. If 
the cap had not been reduced from $193 million to $188 million, instead 
of $16 million remaining under the cap at the end of 1999, there would 
be $21 million remaining under the cap at the end of 1999.
    Question. If so, how much money from the CCC would be used?
    Answer. All of the $21 million remaining under the cap would be 
used in fiscal year 2000 for CCC ADP expenditures.
    Question. Mr. Secretary, does this not violate your commitment to 
me that any funds used from the CCC computer account to pay for the 
waiver of the statute of limitations would not have to be made up in 
future year appropriations?
    Answer. The funds remaining under the CCC cap on ADP expenditures 
would be insufficient under either the current or prior cap. 
Legislation lifting the cap would be needed in either case. We are 
proposing to fully offset the increase of $105 million in the current 
cap by an equivalent reduction in the level of funding authorized for 
the Export Enhancement Program in fiscal years 2000 to 2002.
    Question. Please tell us about the importance of your 
administrative convergence initiative and the fiscal year 2000 $74 
million appropriations request for a new Support Services Bureau.
    Answer. Since 1993, the county-based agencies (Farm Service Agency, 
Natural Resources Conservation Service and the Rural Development 
mission area) have been implementing streamlining plans to cut red tape 
and collocate field offices, with the goal of providing ``one-stop 
service'' for customers. The next phase of this streamlining involves 
converging the administrative organizations of these agencies. An 
initial administrative convergence plan has been developed to create 
the Support Services Bureau (SSB). This plan combines the 
administrative structures of these agencies into one unit to deliver 
better services to local customers and employees, provide a new 
consistency in administrative policy and operations, make better use of 
limited resources, and help preserve limited budget resources for 
program delivery. The SSB will provide human resources, civil rights, 
financial management, information technology and administrative 
services. The salaries and expenses of the new bureau will be financed 
through direct appropriations and transfers from the serviced agencies. 
The Secretary has named an acting Director of the SSB to develop 
implementation plans so that the new consolidated organization will be 
operational by October 1, 1999.
    The $74 million appropriations request provides funding for the 
Service Center Modernization Initiative (SCMI). The SCMI supports the 
on-going change management, customer service, business process 
reengineering, and enabling technology projects. For the past several 
years, this effort has been funded by individual appropriations to the 
partner agencies. However, fiscal year 2000 agency budgets do not 
include funding for this initiative. This account will replace those 
individual funding sources and provide for improved management and 
accountability as this initiative moves forward with major activities 
to reengineer business processes, acquire a common computing 
environment, and create ``one-stop service'' for customers.
             foreign market development cooperator program
    Question. In past years, this Administration proposed that the 
Foreign Agricultural Service directly fund certain costs supported by 
the Commodity Credit Corporation (CCC), proposing that the Foreign 
Market Development Cooperator Program be reduced to offset these and 
other increased appropriations requirements. Now, the President's 
fiscal year 2000 budget proposes that the Cooperator Program be funded 
by the CCC rather than the FAS appropriation to provide stability for 
future program activities. Why is there a reversal in position, both as 
to which costs should be borne by the CCC and the level of funding for 
the Cooperator Program?
    Answer. It is correct that several recent President's budgets 
proposed that funding for certain FAS activities be shifted from CCC to 
the FAS annual appropriation. These proposals were primarily related to 
funding for the operating costs of the CCC Computer Facility, which 
supports FAS' data processing activities, as well as for other FAS 
information resources management (IRM) costs. These proposals were 
based on the view that it is more appropriate to support these types of 
expenditures through discretionary funding, in this case the FAS 
appropriation, rather than through mandatory funding such as CCC.
    At the same time, it is entirely appropriate to fund market 
development activities, including those carried out through the Foreign 
Market Development Cooperator Program, through CCC. In fact, the Market 
Access Program, which also helps to build foreign markets, is already 
funded through CCC. In addition, the CCC Charter Act specifically 
authorizes the use of CCC funds for market development activities, such 
as those supported by the Cooperator Program. A permanent authorization 
for CCC funding of the Cooperator Program, would provide stability to 
the program and enhance long-term planning as noted in the question.
    It should be pointed out proposals in past years' budgets to reduce 
funding for the Cooperator Program were prompted in part by large 
carryover funding balances in the program and were a means of reducing 
those balances. Also, there was a concern that perhaps the program had 
become static and less effective. As a result of changes adopted by FAS 
in recent years, including implementation of a competitive application 
process, it is fair to say that those concerns have now abated to a 
considerable extent. Consequently, the 2000 budget continues funding 
for the program at this year's level.
                            year 2000 (y2k)
    Question. I note that the Department of Agriculture continues to be 
listed as a Tier Two agency (``making progress, but with concerns'') in 
OMB's most recent quarterly Y2K report to the Committee. The concerns 
cited continue to be: (1) the need to increase the pace of work to meet 
government-wide goals; and (2) the need to work out many ``data 
exchanges'' issues.
    What is being done by the Department to address these concerns?
    Answer. USDA currently projects near total compliance for mission 
critical systems by the March 31, 1999 government-wide implementation 
deadline. We are now tracking 353 mission critical systems, of which 76 
percent are compliant. Of the 263 mission-critical systems being 
repaired, 257 (98 percent) are now renovated, 241 (92 percent) are now 
validated and 219 (83 percent) are now compliant. There are 44 mission-
critical systems scheduled for repair which have not completed the 
entire repair process. Of these, 22 have completed testing and are on 
schedule for implementation, six are in renovation and 16 are in 
validation. All are expected to be implemented by March 31, 1999. There 
are 35 systems remaining to be replaced. Of these, 20 are in final 
testing. Fifteen are in development. All but six are expected to be 
implemented by March 31, 1999.
    For data exchanges, USDA has inventoried its data exchanges and has 
identified exchanges with federal, state, local government, private 
sector, and foreign federal and private partners. Departmental agencies 
are actively engaged in dialog with their partners to ensure 
compliance. Overall, USDA is responsible for 467 data exchange files 
representing 1,480 exchange partners. 98 percent of the 467 USDA data 
exchanges identified have been renovated; 96 percent of the 1,480 
partners have been contacted, 80 percent have written agreements on 
date format and 22 percent of partners have successfully tested 
exchanges.
    Of the 331 federal exchanges, the National Finance Center (NFC) is 
responsible for 262, representing 682 partners, primarily payroll and 
finance offices. USDA tracks these exchanges individually because of 
their importance to payroll, personnel and the Thrift Savings Plan. 
USDA agencies are continuing to work with their partners to test 
exchanges, including end-to-end testing.
    USDA agencies are also working with their private sector partners 
to ensure compliance. Certifications and contingency plans are being 
received from some companies. Follow-up is being done with those 
companies who have not reported. Some company reports indicate a deep 
level of commitment to successful processing in 2000. In addition, 
contingency plans indicates companies have a clear plan for maintaining 
business continuity through the date change
    Question. How would you characterize the status of the Department's 
activities to achieve Year 2000 compliance?
    Answer. USDA has given strong management attention to Year 2000 
compliance and is working to ensure the uninterrupted delivery of 
Department programs and services. Mission critical systems are well on 
their way to compliance, as noted above. Significant attention is being 
given as well to non-mission critical systems, embedded technologies, 
facilities, and telecommunications. We will continue to do testing and 
we are devising business continuity and contingency plans.
    Question. The Fiscal Year 1999 Omnibus Appropriations Act provides 
contingent emergency funding for Year 2000 computer conversion 
activities. USDA has already received two allocations totaling $37.8 
million of the emergency funds reserved for non-defense activities.
    Has the Department completed a full assessment of its Y2K 
requirements? What additional funding do you estimate to be required?
    Answer. Assessment of Y2K requirements are continuing. While 
mission critical systems have been identified and virtually all will be 
compliant by March 31, 1999, assessment of embedded systems and 
telecommunication systems are ongoing. Additional funding is likely to 
be required for system remediation, testing, independent verification 
and validation, technical assistance and business continuity planning
    Question. Has OMB allocated the full amount requested by the 
Department to date? If not, what did USDA request over and above the 
allocations provided? Why were these requests not met?
    Answer. The majority of USDA requests were supported by OMB. In 
some isolated instances there was a determination that the request went 
beyond basic Y2K requirements and should be addressed through base 
level appropriations.
    Question. Do you anticipate to request additional emergency funding 
allocations to cover the full amounts estimated to be required?
    Answer. As USDA identifies new requirements, supplemental funds 
will be requested.
    Question. Does the President's fiscal year 2000 budget request any 
additional funding for the Department's Y2K compliance activities? How 
much is requested, by agency?
    Answer. Agencies have identified $10,186,000 for Y2K compliance 
activities for fiscal year 2000. I will provide a breakdown of these 
costs by agency.
    [The information follows:]

               USDA Year 2000 Fiscal Year 1999-2000 Costs

                         [Dollars in thousands]

        Agency                              Total Fiscal Year 2000 Costs
Foreign Agricultural Service..................................       $70
Farm Service Agency--KC.......................................     2,130
Farm Service Agency--HQ.......................................
Risk Management Agency........................................
Farm and Foreign Agricultural Services........................     2,200
Food and Nutrition Service....................................
Food, Nutrition and Consumer Services.........................
Food Safety and Inspection Service............................        85
Food Safety...................................................        85
Agricultural Marketing Service................................        30
Animal and Plant Health Inspection Service....................     2,196
Grain Inspection, Packers and Stockyards Administration.......
Marketing and Regulatory Programs.............................     2,226
Forest Service................................................       200
Natural Resources Conservation Service........................       110
Natural Resources and Environment.............................       310
Agricultural Research Service.................................       205
Cooperative State Research, Education and Extension Service...       280
Economic Research Service.....................................        60
National Agricultural Statistics Service......................       100
Research, Education and Economics.............................       645
Rural Development.............................................
Offices.......................................................
Departmental Administration...................................       500
National Appeals Division.....................................
Office of the Chief Financial Officer--NFC....................     1,000
Office of the Chief Information Officer.......................     2,920
Office of Communications......................................       300
Office of the Chief Economist.................................
Office of the Inspector General...............................
Office of Budget and Program Analysis.........................
Office of the General Counsel.................................
                    --------------------------------------------------------------
                    ____________________________________________________

    Subtotal..................................................     4,720
                    ==============================================================
                    ____________________________________________________
    TOTALS....................................................    10,186

    Question. To what extent, if any will the Department require 
additional funding in future years to replace base information 
technology resources diverted from non-Y2K mission critical elements?
    Answer. The Department has deferred IT investments to the maximum 
extent possible. The Department has worked to leverage investments 
required by Y2K to support modernization objectives. Necessarily, 
however, some projects have had to be deferred as Y2K efforts took 
priority. Base level resources will be rededicated to continuing these 
efforts after we have satisfied the Year 2000 requirements.
    Question. What is being done to make sure that state-operated 
systems essential to the uninterrupted deliver of Federal programs, 
such as Food Stamps, are Year 2000 compliant?
    Answer. Food and nutrition programs are vital to the availability 
of food for millions of Americans, and a priority for USDA. The Food 
and Nutrition Service (FNS) is tracking and reporting Year 2000 
progress from its 50 state partners, Guam, Virgin Islands, Puerto Rico 
and the District of Columbia for the Food Stamp Program (FSP) and the 
Supplemental Program for Women, Infants, and Children (WIC).
    The role of the states in the delivery of Food Stamp, WIC and Child 
Nutrition Program is to administer the programs, determine eligibility 
and provide benefits and necessary service to the public.
    The Special Nutrition Program Directors in the FNS Regional office 
have contacted State agencies which administer School Lunch Program and 
other Child Nutrition Programs to determine the status of their 
preparations for the Y2K conversion and their plans for additional 
compliance activity and for back-up systems to cover possible Y2K 
related systems failures. FNS is coordinating with the Department of 
Education on developing a Y2K status report for state education systems 
which include school food service. FNS has concentrated information 
outreach to state agencies and local cooperators through professional 
conferences and newsletters.
    States must certify to FNS that they are Year 2000 compliant in 
three areas: software, hardware, and telecommunications. States 
reporting that they will not be compliant by March 31, 1999 must 
certify in writing that they have a working contingency plan in place 
which will assure the delivery of benefits to FSP and/or WIC 
recipients.
    FNS will be closely monitoring those states reporting Year 2000 
compliance after March 31, 1999. FNS will offer technical assistance to 
states requiring help and will follow up with on-site reviews for those 
states reporting that they will not be compliant until after March 31, 
1999.
                      assistance to hog producers
    In early January of this year, $50 million in direct cash payments 
under the Section 32 Program were extended to small hog producers to 
help them weather the current economic crisis. The statutory authority 
used to make these payments I understand has been used on only four 
other occasions in the past. It authorizes the Secretary to 
``reestablish farmers' purchasing power by making payments in 
connection with the normal production of any agricultural commodity for 
domestic consumption''.
    Question. Will you also exercise this authority to provide 
assistance to producers of other commodities in similar circumstances?
    Answer. In the event of future economic crises, we will consider 
all the options available to us for assisting producers, including the 
authority use of section 32 to reestablish farmers' purchasing power.
    Question. What assistance have you extended to hog producers to 
date and how has this additional assistance been funded?
    Answer. We have been very busy the past few months addressing the 
pork industry's very critical situation. On January 8, Vice President 
Gore announced that the Department of Agriculture will provide $50 
million in direct cash payments to small, family hog farmers. This is 
the first time in nearly four decades that USDA has made such payments. 
Since February 1998, the Agricultural Marketing Service (AMS) has 
purchased more than 123.9 million pounds of pork worth $116.5 million 
to provide nutritious food for Federal food assistance programs. AMS 
has improved its live hog market reports for 1999, and at meetings with 
major hog slaughterers and processors, I have encouraged greater 
voluntary cooperation with AMS market news reports. The Animal and 
Plant Health Inspection Service accelerated its voluntary pseudorabies 
eradication program, helping to remove up to 1.7 million hogs from the 
market.
    An emergency transfer of $80 million will pay farmers fair market 
value for lost hogs, as well as cover the cost of destruction, 
disposal, and transportation costs. The president had established an 
interagency working group to look at concentration issues at different 
stages of production. The work is led by the White House National 
Economic Council and USDA, and it includes representatives from the 
Federal Trade Commission and the Department of Justice. We want to be 
sure that, at a minimum, we have a baseline of information to examine 
the effects of the changes that are going on in the industry and an 
analytical basis for comparing what is going on in the hog industry to 
that of other industries. And, the Administration successfully opened 
two new markets for U.S. hogs and pork in late 1998. Canada eliminated 
the quarantine and testing requirement for U.S. hogs originating in 33 
States free of the disease and Argentina began allowing entry of U.S. 
pork with certain controls. The Argentine market is expected to be 
worth between $5 to $10 million annually. In addition, as you know, 
USDA announced the a 50,000 tons of pork will be included in the food 
aid package for Russia.
    Question. Will additional assistance to these producers be 
provided?
    Answer. Currently we do not know. However, we will continue to 
monitor the situation closely, and there are several Bills pending that 
provide for additional assistance to hog producers.
    Question. Mr. Secretary, the USDA has announced that 1.9 million 
head of hogs will be rendered/slaughtered because of the accelerated 
pseudorabies eradication program. This will require may hog processing 
plants to work overtime including weekends. Has the Department issued 
the Food Safety Inspection Service a waiver for overtime pay for 
Federal inspectors beyond the first shift of overtime? If not, why?
    Answer. FSIS has not issued a waiver for the collection of 
inspector overtime beyond the first shift. FSIS would be unable to 
absorb the cost of performing the additional inspection services being 
requested.
                           tobacco assessment
    Question. Mr. Secretary, your prepared statement indicates that the 
``appropriations request will include a proposed assessment on tobacco 
marketings similar to the expiring marketing assessment established in 
the Budget Reconciliation Act of 1993.'' We do not find this proposal 
in the President's budget. Has this proposal been submitted to the 
Congress? Please explain. Also explain why this will be an 
appropriations proposal and not a legislative or tax proposal.
    Answer. I understand that the President's Budget documents mention 
that a tobacco assessment will be proposed, but the actual language for 
the proposal was omitted from the appropriations language submitted 
with the budget. The Office of Management and Budget (OMB) plans on 
sending proposed provisions for this assessment in a budget amendment 
or alternatively in the form of proposed legislation supporting the 
proposal in the budget. The proposal would provide for collection of 
$60 million in marketing assessments on price supported tobacco and 
similar imported tobacco in fiscal year 2000. The portion of the 
assessment placed on producers would be held at levels near those of 
the expiring marketing assessment while purchasers and importers would 
be required to pay a higher rate.
    The intent of the proposal is to place this assessment in the 
appropriations language or provide some alternative mechanism to permit 
the collection to offset discretionary spending for the budget 
scorekeeping purposes. We recognize that an approach using only 
appropriations language restricts the assessment collections to the 
fiscal year which does not correspond precisely with the marketing year 
for flue-cured tobacco.
                            credit programs
    Question. Primarily due to low interest rates, the subsidy cost of 
appropriations required to support agriculture, and rural development 
and housing programs are projected to be less in fiscal year 2000. This 
has enabled the Administration to propose program level increases for 
farm credit and rural development and rural housing programs at the 
same or less cost than in fiscal year 1999. For example, the budget 
proposes a $3 billion loan level for farm assistance, $183 million more 
than the loan level supported by the fiscal year 1999 appropriations, 
but at a lower subsidy appropriation ($77 million versus $121 million).
    If farm and rural credit programs were held at fiscal year 1999 
program levels, what savings in subsidy costs requirements for these 
programs would result from fiscal year 1999 to fiscal year 2000?
    Answer. If the farm credit programs were held at the fiscal year 
1999 program level, the subsidy cost for the program would increase $22 
million in fiscal year 2000. Subsidy rates have dropped for most of the 
loan programs or in a few cases risen by less than one percent. 
However, due to the combination of the mix of loan levels for the 
various programs in fiscal year 1999 versus fiscal year 2000, and the 
differences in the subsidy rates for the various programs which range 
from less than one percent to over 15 percent, the net effect of 
funding the fiscal year 1999 loan levels at the fiscal year 2000 
subsidy rates would be an increased subsidy cost in fiscal year 2000.
    On the other hand, the cost of funding the Rural Development loan 
programs at the fiscal year 1999 program level using the fiscal year 
2000 subsidy rates would be $124 million less than the current fiscal 
year 1999 subsidy costs for these programs. It should be noted that 
overall for the Rural Development mission area, the proposed fiscal 
year 2000 program level is about $800 million higher than the fiscal 
year 1999 level ($10.2 billion versus $10.9 billion), at a cost of $181 
million less than in fiscal year 1999 ($2.2 billion versus $2 billion.)
    Question. How much of this savings is allocated to program level 
increases for USDA credit programs in the President's budget and how 
much is used to offset other proposed discretionary program increases?
    Answer. There is no direct connection between the savings in the 
credit programs and increases in other discretionary programs. The 
President's budget was developed to be consistent with certain spending 
ceilings, and all programs had to compete for funds. However, the 
process did not pit specific programs one against one. Rather, savings 
or increases in any one program affected the amount that was available 
for all other programs. Further, decisions on program levels were based 
to the extent possible on demonstrated need rather any allocation of 
funds that remained available. It is noteworthy to add that USDA's 
credit programs in most part are budgeted at or above their 1999 level, 
which suggests strong support for these programs in light of some very 
tight budget constraints.
special supplemental nutrition program for women, infants, and children 
                                 (wic)
    Question. The President proposes an increase in funding for the WIC 
program for fiscal year 2000 to cover food and administrative cost 
increases, as well as participation increases. What is the basis of 
each of these assumptions?
    Answer. FNS inflates the food cost estimate using the inflation 
rate of the Thrifty Food Plan index (from the Food Stamp Program) which 
is projected by OMB. FNS adjusts the Nutrition and Administrative 
Services by OMB projections of the State and Local Consumption, 
Expenditures and Investment Price index projections provided by OMB. As 
for participation, we believe that an average of 7.5 million 
participants will be assisted in 2000. Although participation is around 
7.4 million right now, over the past year or so the program has already 
achieved 7.5 million participants in some months.
                 assumptions supporting the wic request
    Question. The President's fiscal year 2000 budget proposes to 
increase the WIC appropriation from $3.924 billion for fiscal year 1999 
to $4.105 billion for fiscal year 2000. The President's budget 
indicates that the out-year requirements for the WIC program will 
remain at the $4.105 billion level for each of fiscal years 2001 to 
2004. What assumptions are these out-year projections based on, with 
respect to program participation levels and food package and 
administrative costs?
    Answer. The WIC budget projections for 2001 to 2004 do not reflect 
specific detailed assumptions regarding participation levels and per-
person food costs. Rather, the out-year estimates are merely a 
straight-line of the fiscal year 2000 request.
                 dod wic program for overseas personnel
    Question. I understand the Secretary of Defense has the 
discretionary authority to carry out a program to provide special 
supplemental food benefits to members of the armed forces on duty at 
stations outside the United States and to eligible civilians serving 
with, employed by or accompanying the armed forces outside of the U.S.
    Has the Department of Defense (DOD) discussed the delivery of WIC 
benefits to its personnel stationed overseas?
    Answer. Yes, as you may know, DOD's authority to run a WIC-type 
program may be found at 10 U.S.C. 1060a.
                 cost of wic for overseas dod personnel
    Question. What additional funding would be required to deliver WIC 
benefits to DOD and civilian personnel stationed overseas? What number 
of persons do you estimate would be eligible for these benefits?
    Answer. I am told that DOD has estimated that for fiscal year 2000 
the post exchange system would deliver WIC commodities for an average 
of about $29 per recipient per month. This compares favorably with the 
stateside cost estimated to be about $33 in 2000. Overall, they believe 
participation could be somewhere in the 32,000 range, so it is 
reasonable to anticipate a food cost of around $11 million a year. In 
general, the non-food costs of running a WIC type program for DOD 
overseas--nutrition education, referrals for medical care, and client 
and store management--are largely already included in existing, funded 
activities. Let me look into this and provide some additional detail 
later.
    DOD faces uncertainties in predicting likely participation 
overseas, just as USDA does for the WIC program stateside. As for 
participation of military family members overseas, DOD has estimated 
that based on pay levels and family configurations for persons posted 
overseas, there are as many as 31,173 income eligible infants and 
children under the age of 5 in households of military personnel posted 
overseas. Assuming that nutritional risk is the same as for the regular 
Stateside WIC program, i.e., about 81 percent of income eligibles would 
have nutritional risk, the outside maximum participation could be 
31,782. Actual participation could be lower, DOD reports, because this 
figure does not take into account spousal incomes; it includes some 
family members who are not, in fact, living overseas; and it assumes 
100 percent participation.
                    dod wic delivery system overseas
    Question. Is there a delivery system in place for the provision of 
these benefits?
    Answer. As we understand it, the delivery system is essentially in 
place. Since medical services are provided, DOD apparently believes 
that it already can determine which women, infants and children are at 
nutritional risk; they provide some nutritional guidance; and they 
provide medical services. Food packages would be prescribed and then 
provided through the DOD post exchange system. Adding food packages to 
DOD's existing activity would drive home the nutritional messages and 
help assure good nutritional outcomes, just like it does for the 
regular WIC program. DOD says that this will help focus the military 
medical and family support services more directly on helping these 
needy families, and the post exchanges would make sure the right foods 
were available, substitutions were not allowed, etc.
            responsibility for wic benefits for dod overseas
    Question. Who would be responsible for the cost of delivering these 
benefits--USDA or DOD?
    Answer. Current statute would appear to permit use of funds from 
DOD or USDA. USDA could fund the food portion of the DOD WIC program if 
USDA appropriations language explicitly provides such authority. 
Nutrition services and administration costs are the responsibility of 
DOD.
               difference in natural versus refined sugar
    Question. Are you aware of any new scientific evidence that 
indicates that all forms of sugar are metabolized by the human body in 
the same way, that is, the human body cannot distinguish the difference 
between the sugar contained in fruit and sugar found in other forms, 
such as refined crystals of honey?
    Answer. I am told that the Dietary Guidelines Review Committee is 
going to take a look at the recommendations made for sugar that will 
appear in the Dietary Guidelines 2000. I am not aware that there is new 
information in the area, but will be interested to see any 
recommendations that come from the Review Committee.
    As far as how sugar is metabolized, it is my understanding that the 
cells use principally glucose, so that almost all the sugars must be 
digested down to glucose before it is absorbed by the cells and then 
metabolized. So, I think it is generally correct to say that the body 
cannot distinguish the source of glucose when it is metabolized. Let me 
follow-up with a little more technical information on this.
    As far as digestion goes, I don't know that it would be correct to 
say that each type of sugar is digested in exactly the same way. In any 
case, nutritionists generally prefer that people acquire sugars from a 
variety of fruits, vegetables and grains--foods with no added sugars--
because such foods provide other important vitamins and minerals.
    Almost all the sugars must be converted to glucose before they are 
used by the cells for energy, i.e., metabolized. The products of 
digestion of sugars, ``natural'' or ``added,'' as well as 
carbohydrates, are approximately 80 percent glucose, and 20 percent 
fructose and galactose. The fructose and galactose are absorbed into 
the blood stream and then converted into glucose by the liver, so that 
more than 95 percent of sugars are present in the blood as glucose. 
Consequently, it appears reasonable that the body cannot distinguish 
the source of glucose or fructose when it is metabolized and used to 
produce energy.
                        sugar in the wic package
    Question. What is the total allowable sugar content of the WIC food 
package?
    Answer. USDA does not set limits on the total amount of sugar 
allowed in a WIC food package. Federal WIC regulations do limit the 
total amount of sugar permitted in WIC adult breakfast cereals to no 
more than 6 grams of total sugars per dry ounce of cereal, including 
both naturally occurring and added sugars.
    Sugar occurs naturally in many foods, including WIC foods such as 
milk and fruit juices. Sugar is added to many foods, including WIC 
foods such as adult breakfast cereal and peanut butter. With seven 
different WIC food packages and choices within them, calculating the 
total sugar content of the packages would be complicated and a little 
speculative. However, USDA's Center for Nutrition Policy and Promotion 
(CNPP) recently completed a comprehensive review of how well the WIC 
packages meet the needs of the WIC target population. A final report is 
expected to be available soon, which I will be glad to share with 
Members of Congress. The report provides some ideas on sugar, so I will 
ask for some additional information on the topic.
    There are seven WIC food packages, each designed to supplement the 
nutritional needs of different categories and ages of participants. The 
types and amounts of foods vary among the food packages and choice of 
foods in the packages may also be exercised at the State and clinic 
levels, and of course, by the client when she redeems the WIC vouchers 
in the store.
    While the sample sizes in existing data sources used for the WIC 
package study were not ideal, they were adequate to estimate that WIC 
foods provide about 1 teaspoon of added sugar to the diets of women and 
children a day. One teaspoon is about 4 grams of sugar. Total daily 
added sugar intake from all foods for WIC children and women ranged 
from about 12 to 23 teaspoons per day, with older children and women 
toward the high end of the range. Each target subgroup consumed more 
added sugar than recommended in their total diet. However, total 
calorie consumption did not appear to be a problem in this review.
    WIC foods include: iron-fortified infant formula, special infant 
formulas and certain medical foods, iron-fortified dry infant cereal, 
infant juice high in vitamin C, 100 percent fruit and/or vegetable 
adult juice high in vitamin C, hot or cold adult breakfast cereals high 
in iron and low in sugar, milk, cheese, eggs or dried egg mix, peanut 
butter, dry beans or peas, canned tuna, and carrots. Further, fresh 
fruits and vegetables are available through the WIC farmers' market 
program, where it is available.
                        civil rights settlement
    Question. It is my understanding that settlement payments under the 
class action discrimination lawsuit against USDA will be paid from the 
settlement fund for members of the class who choose option A. For those 
who chose option B, any damages they are awarded will be paid by USDA. 
I also understand that USDA may incur other costs of the settlement.
    Please provide an estimate of the total costs to the Department for 
the settlement. Break down the costs by agency, the fiscal year the 
cost will be incurred, a description of the cost, and whether the 
President's budget accommodates these costs and, if not, how the costs 
will be paid.
    Answer. All settlements under the Consent Decree, both tracks A and 
B, are to be paid from the Judgement Fund described in 31 USC Sec 1304. 
The Farm Service Agency (FSA) administers all of the programs covered 
by the class action suit so FSA will incur most of the administrative 
costs. The costs will be incurred during fiscal year 1999 and fiscal 
year 2000, and it is anticipated that they will be taken from budget 
allocations. At this time we do not know the number of farmers who will 
choose to participate in the Consent Decree nor can we determine the 
number of farmers who will choose to opt out of the Consent Decree and 
engage in negotiated settlements. Given the above it is difficult to 
estimate what the cost will be. We will provide an estimate of the 
costs to the Subcommittee once more information is available.
                civil rights office additional resources
    Question. The fiscal year 2000 budget requests additional resources 
for the Office of Civil Rights to handle the increased workload in 
discrimination complaints. Would you please give us a status report on 
this--the reduction you have made over the past two years in the 
backlog of discrimination complaints, the additional workload resulting 
from the waiver in the fiscal year 1999 Appropriations Act of the 
statute of limitations for certain complaints filed, and the level of 
new complaints filed with the Office.
    Answer. There were 1,088 program discrimination complaints in the 
backlog. All of those cases have been resolved with the exception of 10 
cases where complainants did not accept a resolution offer, eight cases 
that are being resolved through further investigation, and the class 
member cases. Of the 497 new cases filed since November 1, 1997, 285 
have been resolved and 212 remain active.
    There were 2,142 cases in the employment backlog. Of those, over 
1,500 have been resolved. Of the 1,234 new employment cases filed, 236 
have been closed and 998 remain active.
    As a result of the waiver of the Statute of Limitations the Office 
of Civil Rights currently has 194 eligible cases under review. It is 
anticipated that several hundred additional cases will be submitted for 
Statutes of Limitation processing.
             developing technologies for use in agriculture
    Question. Mr. Secretary, I understand that you and the 
Administrator of the National Aeronautics and Space Administration 
(NASA) signed a Memorandum of Understanding indicating your intention 
to cooperate in developing technologies for use in agriculture. It is 
my further understanding that NASA has designated the Stennis Space 
Center in Mississippi as the lead site for agriculture application 
research in remote sensing. Can you tell me of any progress that has 
been made in implementing this Memorandum of Understanding?
    Answer. The U.S. Department of Agriculture (USDA) and NASA signed a 
Memorandum of Understanding in 1998 to enhance agriculture applications 
research in remote sensing. The Agricultural Research Service (ARS) has 
promoted joint efforts between the Stennis Space Center and the Remote 
Sensing and Modeling Laboratory in Beltsville, Maryland, in cooperation 
with Purdue University at West Lafayette, Indiana. Through a grant from 
the Stennis Space Center, we are developing more advanced remote 
sensing technologies for agricultural applications. The Remote Sensing 
and Modeling Laboratory has also developed a Small Business Innovation 
Research (SBIR) grant with 3DI, a small company based in Maryland, to 
evaluate remote sensing applications in the Mid-Atlantic States; a 
prominent NASA scientist has also been stationed with this laboratory 
to assess the capabilities of remote sensing to detect drought and crop 
water stress conditions. In addition, six ARS locations (Phoenix, 
Arizona; Shafter, California; Ames, Iowa; Beltsville, Maryland; 
Lincoln, Nebraska; and Lubbock, Texas) have a cooperative project with 
Resources 21, a private company, in which remotely-sensed crop growth 
and production data has been successfully collected from five sites 
throughout the United States in 1998. USDA continues to coordinate and 
develop new opportunities to interact with NASA, the United States 
Geological Survey (USGS), and the National Oceanic and Atmospheric 
Administration (NOAA) with the goal of reducing the cost and increasing 
the performance of future Landsat-type satellites which could provide 
remote sensing data that can be used to improve the management and 
protection of agricultural lands.
    Question. I understand that Dr. Miley Gonzalez, Under Secretary for 
Research, Education, and Economics, has had some input and 
conversations with NASA personnel and with representatives of some 
commodity organizations about research and application programs in 
remote sensing technologies for crop production. Could you please 
provide for the record a summary of the current plan to move forward 
with NASA in a joint effort?
    Answer. Dr. Gonzalez hosted a meeting on January 27, 1999, that 
included representatives from the National Cotton Council; American 
Soybean Association; Integrated Technology Development; NASA's Stennis 
and Goddard Space Centers; the Cooperative State Research, Education, 
and Extension Service (CSREES); and ARS. The focus of the meeting was 
to develop an integrated strategy for transferring the benefits of 
remote sensing techniques to food and fiber producers. Dr. Gonzalez 
agreed that USDA--Research, Education, and Economics (REE) is willing 
to provide leadership to a remote sensing initiative in partnership 
with other interested parties to determine the critical needs and 
priorities for successfully commercializing remote sensing. A major 
workshop will be held during the summer of 1999 to launch the 
initiative on the applications of remote sensing to agriculture. A 
planning committee will be identified with representatives from NASA, 
CSREES, ARS, and private industry.
                 global change research and initiatives
    Question. Please explain the importance of the President's Global 
Change Research and Climate Change Technology initiatives for U.S. 
agriculture.
    Answer. The USGCRP was created as a Presidential Initiative in 1989 
and formalized in 1990 by the Global Change Research Act of 1990. The 
Global Change Research Program provides a well-founded scientific 
understanding of the Earth system to ensure the availability of future 
resources essential for human well-being, including water, food, fiber, 
ecosystems, and human health. The U.S. Global Change Research Program 
(USGCRP) provides the foundation for improving predictions of seasonal 
to-interannual climate fluctuations (which can bring excessively wet 
and dry periods) and prediction of long-term climate change. The USGCRP 
also sponsors research to understand the vulnerabilities to changes in 
important environmental factors, including changes in climate, 
ultraviolet (UV) radiation, and land cover. Scientific knowledge is 
essential for informed decision making and to ensure the social and 
economic health of future generations.
    USDA has been a part of the USGCRP since its inception, with the 
research focus on understanding terrestrial systems and the effects of 
global change (including water balance, atmospheric deposition, 
vegetative quality, and UV-B radiation) on food, fiber, and forestry 
production in agricultural, forest, and range ecosystems and examines 
how agricultural and forestry activities can contribute to a reduction 
in greenhouse gases. USDA research provides policy-makers and 
agricultural producers with useful, scientific data and information.
    Although listed under a global change banner, this research is 
integral to USDA's critical mission--ensuring an adequate and 
affordable supply of food and fiber while protecting the resource base 
for future generations. For example:
  --Interactions between terrestrial ecosystems and the atmosphere.--
        Understanding the controls on gaseous exchanges between plants 
        and the atmosphere will improve our ability to manage 
        production because it is these very exchanges that determine 
        net crop yield.
  --Methane generation and nitrous oxide release.--An improved 
        understanding of processes controlling the uptake and release 
        of these radioatively active trace gasses is also of benefit in 
        other sectors of the agricultural enterprise as it will help to 
        resolve multiple agricultural management problems resulting 
        from climate change.
  --Soil properties.--Although much emphasis is being placed on the 
        potential for forest, range and agricultural soils to serve as 
        carbon sinks, this very characteristic of soils has always been 
        a critical consideration in agriculture. Losses in soil carbon 
        are related to losses in soil fertility, reduced efficacy of 
        added fertilizers, reduced moisture holding capacity, reduced 
        capacities for pathogen management, and increased soil losses 
        due to erosion.
  --The relationship of climate with production.--The relationship 
        between weather, climate and production losses from forest and 
        range fires, insects, and plant pathogens has long been 
        documented. The improved understanding of climate variability 
        that results from global change research will enhance our 
        ability to both predict weather events at the local and 
        regional scales and to develop response strategies that will 
        balance agricultural demands with those of other sectors.
  --Contributions of agricultural sources of methyl bromide to 
        stratospheric ozone depletion (and possible alternatives and 
        substitutes for this fumigant).--We already know that methyl 
        bromide causes damage to the earth's ozone layer. Our research 
        in this arena is necessary to diversify our options for 
        environmentally-friendly pathogen control.
    In fiscal year 2000, USDA is requesting a $34.1 million increase in 
it global change research programs. Of this increase, $23.7 million is 
focused on increasing our carbon cycle research program. As part of an 
interagency effort, USDA will collaborate with other Federal agencies 
to conduct research to better understand how agricultural practices 
affect the net carbon balance and develop methods which will assist 
farmers, ranchers, and forest landowners to increase carbon 
sequestration. Special emphasis will be given to measurement of the 
effects of management and conservation practices on carbon storage in 
cropland and grazing lands.
    Climate Change Technology Initiative.--In the fiscal year 2000 
budget, the President is proposing a 34 percent increase for R&D in 
energy efficiency technology and renewable energy; A new Clean Air 
Partnerships Fund to boost state and local efforts to reduce greenhouse 
gases and air pollution; a five year-year package of tax incentives to 
spur clean energy technologies; substantial new funding to focus on 
ways farmers and forests can reduce and offset greenhouse gas 
emissions. USDA's CCTI programs focus on carbon sequestration and 
biomass demonstration projects, and on developing new technology for 
predicting and adapting to global climate impacts.
    Carbon Sequestration ($3.0 million, NRCS; $3.0 million, FS).--NRCS 
will carry out pilot projects for delivery of carbon enhancing 
conservation systems. Pilot projects will be conducted on croplands, 
grazing lands, and animal feeding operations, using existing financial 
and technical assistance programs. FS will: develop and demonstrate the 
following: pathways for optimizing biomass standing stock for carbon 
sinks: low impact harvest options and soil management techniques that 
conserve carbon and increase water production capacity; and management 
options for improving direct sequestration of carbon in forest soils.
    Biomass (FS, $3.0 million; ARS, $3.0 million).--FS will develop and 
demonstrate management practices for short-rotation woody crop 
production systems that provide near zero net carbon release and are 
sustainable across a range of geobiological systems. FS will identify 
barriers, economic benefits, and management regimes for farmers to grow 
tress for energy and carbon sequestration. ARS will develop databases 
for determining the potential of selected pastures and rangeland 
renovation practices, growth of biomass crops such as switchgrass, and 
conventional forage production systems for storing soil organic carbon.
    Technology for Predicting and Adapting to Global Climate Impacts 
($4.0 million, ARS).--ARS will focus on the development of new 
knowledge and modeling technology designed to help agriculture adjust 
to a changing climate. ARS will develop models at basin and ecosystem 
scales and using remotely sensed data will be developed. Climatic and 
weather phenomenon (such as El Nino) simulation models will also be 
developed to determine the effects of climate change on insects, crops, 
water resources, rangelands, etc. Field experiments will be established 
to generate response functions for range, pasture and crops to changes 
in carbon dioxide, temperature, and water availability related to 
climate change impacts.
                       u.s. agricultural exports
    Question. What actions have been taken by this Administration over 
the past year to help U.S. farmers and ranchers by maximizing export 
sales and expanding their access to overseas markets?
    Answer. In response to weakened foreign demand, we have taken a 
number of important steps over the last year to bolster exports and 
maintain access to key foreign markets. In response to the Asian 
financial crisis, we increased substantially the level of export credit 
guarantees made available by CCC. Sales registrations under the 
programs during fiscal year 1998 were 40 percent higher than the year 
before. We anticipate this expanded level of programming will continue 
in both 1999 and 2000.
    We are implementing the President's Food Aid Initiative, under 
which 5 million metric tons of wheat and wheat products are being made 
available for donation overseas. Also, we have developed and are 
carrying out a major package of food assistance for Russia in order to 
assist that country and maintain access for our products. Russia is an 
important market for U.S. grains, poultry, pork, and beef, and we want 
assist it regain its status as a commercial purchaser.
    Over the long term, the best means of ensuring expanded access to 
overseas markets for our farmers and ranchers is through the 
negotiation of improved market access and a reduction in trade 
barriers. Therefore, we have worked vigorously to open and expand 
markets through a wide range of trade policy activities. Last February, 
the United States and Taiwan signed a market access agreement which 
provides for Taiwan to lift its import bans and allow access for U.S. 
pork, poultry, and variety meats. Upon Taiwan's accession to the World 
Trade Organization, it will cut tariffs and open tariff-rate quotas on 
numberous agricultural products.
    We also have begun preparation for the new round of multilateral 
trade negotiations which is set to begin later this year. These 
negotiations present an important opportunity to strengthen disciplines 
on agricultural trading practices and gain improved access to world 
markets for our products. We have pursued trade liberalization on a 
regional basis as well. These activities include negotiations for the 
Free Trade of the Americas and within the Asia Pacific Economic 
Cooperation forum.
                         economic concentration
    Question. Mr. Secretary, in your oral remarks you commented on 
issues related to profits of certain meat packers relative to the price 
received for live cattle. What are the Department's estimates of the 
fixed costs that packers have (such as labor, equipment, and overhead) 
and their proportional share of overall operating costs, including the 
price of cattle purchased?
    Answer. Recent research by the Economic Research Service analyzed 
Census of Manufacturers data on 1992 cattle-only slaughter plant costs 
in four broad categories. It found livestock and meat purchases 
accounted for 86 percent of total costs; labor and all other materials 
between 5 and 6 percent each, and capital about 3 percent.
                     public law 480 program funding
    Question. The President's fiscal year 2000 budget proposes to 
reduce funding for the Public Law 480 Titles I and II programs, and to 
eliminate funding for the Title III program. The fiscal year 2000 
request is estimated to support 3.2 million metric tons of commodity 
assistance to recipient countries, versus 3.6 million in fiscal year 
1998 and 5.4 million in fiscal year 1999. The fiscal year 1999 level 
includes 1.8 million metric tons of assistance for Russia funded by the 
transfer of CCC funds to Public Law 480 Title I.
    The justification for elimination of Title III funding is that 
funds from the Titles I and II programs can be transferred if required. 
In addition, the USDA budget summary indicates that it is proposing to 
transfer unused Export Enhancement Program (EEP) funds to foreign food 
assistance programs, such as Public Law 480, toward the end of the 
year.
    Why is the Administration proposing to reduce Public Law 480 for 
fiscal year 2000 and to use mandatory funds to ``back-fill'' the 
program if necessary?
    Answer. It should be noted that the reduction in Public Law 480 
programming proposed for 2000 is exaggerated because of the Title I 
assistance being programmed to Russia this year. If the assistance to 
Russia, which results from some extraordinary circumstances, is 
excluded from this year's Public Law 480 program level, the reduction 
is considerably less. Nevertheless, as noted, the President's budget 
does include a reduction in funding for Public Law 480 for 2000. This 
is due to the very constrained targets that have been established for 
discretionary spending government-wide in conjunction with efforts to 
balance the Federal budget. A higher program level for Public Law 480 
might have been preferred, but it was not possible given the spending 
targets that must be complied with.
    The proposal to authorize the use of unobligated Export Enhancement 
Program (EEP) funds for certain food aid activities is designed to 
provide greater flexibility to program managers so they may respond to 
changing program needs and world events during the course of the year. 
Clearly, there is a tremendous need for foreign food assistance at the 
present time.
    At the same time, funding authorized for EEP has barely been used 
in recent years. It seems prudent, therefore, to authorize alternative 
uses for that funding, particularly when discretionary funding is so 
tight. Farm groups in recent years have called on the Department to use 
EEP funding for other purposes if it is not being fully used for EEP 
bonus awards; this proposal responds to their concerns.
    The funding proposed for Public Law 480 programs in the budget does 
not specifically assume that unobligated EEP funds will be used to 
support Public Law 480 programming in 2000. Nevertheless, for the 
reasons just cited, it would be extremely useful if the authority do so 
when circumstances warrant were provided by Congress.
    Question. The authorizing statute has always permitted the transfer 
of funds between titles of the Public Law 480 program. Why is the 
Administration now proposing to eliminate specific funding for Title 
III grants and to fund these grants by the transfer of funds from 
Titles I and II of the program?
    Answer. No additional funding was requested for Title III 
activities because of tight budget constraints and a higher priority 
placed on funding other U.S. foreign assistance activities, 
particularly the development assistance activities administered by the 
Agency for International Development. As noted in the question, program 
managers could consider a transfer of funds from either Title I or 
Title II should a particular country's food aid needs be appropriate 
for Title III. However, such a decision would only be made during the 
course of the fiscal year, and the budget does not assume that it will 
or will not occur.
                      forestry incentives program
    Question. I understand that OMB has proposed that the additional 
$10 million in emergency appropriations for the Forestry Incentives 
Program appropriated in the 1999 Appropriations Act should all be given 
to one state, Florida. Others states have indicated a need for these 
funds. Is this true or will these funds be available to address the 
needs of other states?
    Answer. It was determined that assistance should be provided to 
other States as well as Florida based on an agreement between the 
Department and OMB. $9 million in Forestry Incentives Program (FIP) 
funds were allocated to 17 States to address reforestation needs caused 
by wildfires and other natural disasters in 1998. Florida's $3 million 
State allocation was the largest. A $1 million reserve is being 
retained for future assistance, primarily for tree planting needs in 
Florida.
    Question. When does the Department plan to distribute these funds?
    Answer. The Department distributed these funds to the States on 
February 16, 1999.
                     lower mississippi delta region
    Question. In fiscal year 1999 the Committee included a general 
provision in the bill providing the Secretary of Agriculture the 
authority to transfer up to $26,000,000 of the total discretionary 
spending appropriated by the act for programs and activities for the 
benefit of the Lower Mississippi Delta region.
    What monies are currently being used for programs and activities of 
benefit to the Delta region?
    Answer. The counties in the Lower Mississippi Delta Region have 
received significant funding from a variety of Rural Development 
programs in prior years, including $100 million in fiscal year 1996, 
$134 million in fiscal year 1997 and $164 million in fiscal year 1998, 
and this does not include the housing programs. The counties in the 
Delta Region are one of the targeting priorities for Rural Development 
funding and because of the widespread poverty throughout the region 
these counties do very well in competing for funds.
    We do not plan to use the authority because of the other critical 
needs that need to be addressed with the funding appropriated for those 
uses.
    Question. Has the Department worked with other Federal Departments 
and agencies to bring government-wide attention to the special needs of 
this region as the Committee encouraged in the fiscal year 1999 
Conference Report? Has the Department consulted with local 
organizations, such as the Lower Mississippi Delta Development Center, 
Inc.?
    Answer. the Office of Community Development (OCD) within Rural 
Development provides technical assistance to a group called the 
Southern EZ/EC Forum. The Forum originally consisted of the rural and 
urban Empowerment Zones and Enterprise Communities in Arkansas, 
Mississippi, and Louisiana. OCD encouraged the Forum in 1997 to expand 
to cover the EZ/ECs in the states of Illinois, Kentucky, Missouri, and 
Tennessee. The expanded Forum joined with the Lower Mississippi Delta 
Development Center to form a regional initiative to revitalize the 219 
counties that were the subject of the Lower Mississippi Delta 
Development Commission Report issued in 1990. These organization have 
been joined by the Enterprise Corporation of the Delta, and the 
Foundation for the Mid-South to form the Delta Initiative Partnership. 
This partnership agreement was signed in April, 1998 in the presence of 
the Vice President, Secretary Glickman, and Secretary Slater.
    In July 1998, OCD cooperating with the Department of Transportation 
in organizing a conference in Memphis, Tennessee to organize a Federal 
interagency working group to focus resources on the 7 states and 219 
counties that were the subject of the original Delta Commission. 
Signatories to that Memorandum of Understanding are Secretary Slater, 
Under Secretary Jill Long Thompson and representatives form the 
Department of Housing and Urban Development, Department of the 
Interior, Department of Health and Human Services, Department of 
Commerce, Department of Labor, Department of Education, the Small 
Business Administration, and the Environmental Protection Agency.
    In addition, the Department has worked closely with the Mississippi 
Department of Economic and Community Development, HUD, Fannie Mae, the 
Fannie Mae Foundation, Bank of America, LISC, Mississippi Home 
Corporation (Housing Finance Authority), Children's Defense Fund, non-
profit organizations, the Housing Assistance Council, and a number of 
others to provide financial and technical to the Lower Mississippi.
    Question. Mississippi's State Director for Rural Development has 
contacted my office about two projects that he plans to recommend to 
the agency to be funded from the $26 million available for transfer. 
(The Children's Defense Fund has presented a grant to Meyersville for 
the renovation of a church which serves as City Hall and to provide 
teen health services for children. Meyersville has no capacity to 
provide matching grant monies. The Mississippi Department of Education 
along with Fannie Mae and Rural Housing plan to provide housing for 
teachers in West Tallahatchie county.)
    How do you predict the Department will handle these recommendations 
given this authority to transfer money for the funding of projects in 
the Lower Mississippi Delta area?
    Answer. The Department does not plan to use this transfer 
authority. With limited resources it is unfortunately not possible to 
fund many eligible projects. Rural Development staff is working with 
the appropriate people in Mississippi to identify possible alternative 
resources which might be tapped for these projects.
                             workload study
    Question. USDA contracted with PricewaterhouseCoopers to conduct a 
study of the farm and rural program delivery system of the Farm Service 
Agency, the Natural Resources Conservation Service, and Rural 
development. This study was scheduled to be completed on September 18, 
1998.
    What findings were reported on the three agencies studied?
    Answer. The study provided findings on a wide range of topics 
concerning the organization, operation, workload, clientele demands and 
purposes of the county based agencies. While the detailed findings are 
too voluminous to adequately summarize, highlights include the 
following. The study concludes there are some imbalances between 
program authorities or legislative mandates, funding limitations, and 
agency business strategies which constrain the agencies' ability to 
deliver programs and meet customer demands. The study also found that 
recent changes in legislation and reduced funding and staffing have led 
to some structural problems impeding efficient and effective service 
delivery. It noted that USDA cannot effectively respond to trend 
changes in customer demand when constrained to locating offices 
according to political boundaries.
    The study noted opportunities to improve efficiency by minimizing 
``back-office'' activities. The findings were supportive of the 
administrative convergence initiatives. Likewise, the study concluded 
that the Department's Service Center Initiatives will succeed in 
achieving some efficiencies. However, the report concludes that further 
efficiencies from administrative convergence and service center 
initiatives could be gained by removing the current ``smoke stack'' 
structure in the county based agency delivery system. Another finding 
was that there is a critical need for information technology 
improvements. FSA county offices were found to probably be somewhat 
more disadvantaged than NRCS and RD although IT capabilities varied. 
Few substantive findings were reported about agency workload, although 
FSA was cited as the only county based agency with a formal work 
measurement system at the time of the study. The report recommended 
development of workload measurement system for all the county based 
agencies. (And NRCS is putting a system in place this year.)
    The Department is still reviewing the study findings and 
recommendations and while not all of the recommendations appear 
feasible or well founded, the Committee should be aware that important 
elements of the fiscal year 2000 budget are consistent with the 
contractor's findings. These include the proposed Support Services 
Bureau to implement administrative convergence for these agencies and 
the proposal to increase the limitation on CCC spending for ADP which 
was one of the imbalances cited by the study which has contributed to 
inadequate resources for IT.
    Question. How will the Department use these findings? Are these 
findings incorporated in the President's fiscal year 2000 budget 
request? If not, why?
    Answer. As stated earlier, the Department is still reviewing the 
study findings and recommendations and while not all of the 
recommendations appear feasible or well founded, the Committee should 
be aware that important elements of the fiscal year 2000 budget are 
consistent with the contractor's findings. These include the proposed 
Support Services Bureau to implement administrative convergence for 
these agencies and the proposal to increase the limitation on CCC 
spending for ADP which was one of the imbalances cited by the study 
which has contributed to inadequate resources for IT.
                        nrcs' strategic planning
    Question. NRCS briefed my staff on its progress with the 
development and implementation of the agency's strategic planning 
process. What is the status of the other [county-based] agencies' 
progress in implementing the strategic planning process?
    Answer. NRCS has made significant progress in use of the internet 
in charting performance goals, indicators, workload, and 
accomplishments. FSA and RD are similarly using the internet 
effectively to broaden public access to program information and 
application materials. The county-based agencies are all actively 
exploring further opportunities to improve services while reducing 
costs through streamlining, restructuring, and modernizing technology. 
RD management initiatives, for example, focus on quality customer 
service in support of the USDA initiative to improve customer service 
by streamlining and restructuring county offices, while the FSA 
performance plan notes progress in collocating offices, developing a 
common communications and computing platform, and converging 
administrative structures of the county-based agencies at the county, 
state, and headquarters levels. USDA is completing an overview of the 
annual performance plan and will shortly be submitting the agency plans 
and overview to Congress.
    Question. Will the workload study contracted with 
PricewaterhouseCoopers affect this process? If yes, how?
    Answer. The study provides direction for reforming the existing FSA 
workload measurement system and supports efforts in the other agencies 
to establish or upgrade existing measurement systems. The study also 
recommends development of a common workload measurement system for the 
service centers. We are incorporating recommendations of the study 
where appropriate in order to improve the usefulness of the workload 
measurement system in allocating staff, restructuring offices, and in 
other management determinations. Beyond workload issues, while we have 
no current plans to merge the field operations of the agencies, as 
recommended in the study, the study clearly supports the management 
initiatives included in the strategic plans of the agencies to capture 
efficiencies through administrative convergence, streamlining, and 
modernization.
                             workload study
    Question. Please make a copy of the PricewaterhouseCoopers study 
available to the Committee.
    Answer. The completed study consists of several volumes. We will 
provide a copy to the Committee.
                  farm service agency office staffing
    Question. Mr. Secretary, your prepared statement indicates that the 
Farm Service Agency (FSA) has been downsizing its staff since 1993. 
Staffing has declined by about 6,000 staff to about 16,400 staff years 
at the end of 1998. The proposed program level for salaries and 
expenses in fiscal year 2000 is an estimated $1 billion to support a 
ceiling of a total of 15,793 federal and non-federal county staff 
years. You say there will be no reductions in force in fiscal year 
1999. Why the decline in staff years, from 16,400 in 1998 to 15,793 in 
2000 given the increased funding requested (+$80 million) in fiscal 
year 2000.
    Answer. First, the increase in funding requested is $40.5 million 
from the 1999 enacted level, not $80 million. Although the fiscal year 
2000 budget request is an $80.0 million increase from the fiscal year 
1999 President's Budget request, it is a $40.5 million increase from 
the enacted fiscal year 1999 appropriation. This is worth noting 
because the $40.0 million enacted as part of the emergency provisions 
of the 1999 Appropriations Act is being used to support essentially the 
same level of staffing in fiscal year 1999 as the 16,400 staff years 
you cite for fiscal year 1998. Next, most of the $40.5 million increase 
being requested for fiscal year 2000 is for pay and related costs of 
existing personnel. FSA has several sources of funds other than new 
appropriations to support staffing levels, including funds carried 
forward from the prior year under authority of a general provision in 
the annual appropriation act. The total available funds for non-Federal 
county office activities in fiscal year 2000 includes no funds carried 
forward from the prior year, whereas in fiscal year 1999, FSA has $32.1 
million in fiscal year 1998 carryover balances to finance fiscal year 
1999 staffing costs. Therefore, there is a reduction of $32.1 million 
in total available funds for staffing in fiscal year 2000, which means 
that the net increase in funding is actually only $8.4 million. Given 
the pay cost needs previously cited, this requires a staffing 
reduction.
    Question. How many offices have been closed because staffing 
reductions left only 1 to 2 employees in the office in 1998?
    Answer. There were 34 offices closed in 1998 which had 2 employees 
or less.
    Question. How many will be closed in 1999?
    Answer. There are no office closings currently scheduled for fiscal 
year 1999, but if the economics of maintaining certain small offices is 
disadvantageous to efficient program delivery, then some closings 
likely will be done, which is a normal occurrence.
    Question. Where are these offices located by county and state?
    Answer. Once the Agency further analyzes the impact of workload 
estimates and identifies the criteria for determining the most 
efficient use of office staffing and considers the impact of 
prospective administrative and program efficiencies on county office 
operations, FSA will be in a better position to identify specific 
locations of any closures. Congressional delegations will be advised 
before any closures are effected.
    Question. Does the Department intend to inform Congress of any 
additional staff reductions?
    Answer. Yes, FSA will inform Congress of any additional staff 
reductions. However, FSA needs every available employee in order to 
operate under its current heavy workload. Any significant staff 
reductions will be done only as a consequence of funding constraints.
    Question. Why have we not been informed of the prior staffing 
reductions in 1998 and those planned in 1999?
    Answer. Both the fiscal year 1998 and fiscal year 1999 President's 
Budget submissions included clear references to staffing reductions. In 
the fiscal year 1998 Explanatory Notes, FSA's fiscal year 1998 Budget 
included estimates for relatively large numbers of buyouts and RIF's to 
occur in fiscal year 1998 in order to inform Congress of staffing 
reductions planned for that year. These references are found on pages 
18-65 and 18-66. Use of unanticipated carryover balances in fiscal year 
1998 mitigated the actual number of separations that were ultimately 
necessary. The original plan to RIF 855 county personnel and 255 
federal personnel in fiscal year 1999 was also indicated in the fiscal 
year 1999 Explanatory Notes on pages 18-48 and 18-50. As you know, the 
$40 million enacted under the emergency provisions of the 1999 
Appropriations Act allowed FSA to avoid those budgeted staffing 
reductions.
                          fsa office staffing
    Question. The Congress appropriated an additional $40 million for 
FSA for salaries and expenses to maintain staffing levels to meet 
increased workload demands expected from the emergency farm aid 
provided for fiscal year 1999. In the prepared statement, you indicate 
that this appropriation allowed the agency to avoid reductions-in-force 
this year and to hire temporary staff. Is the $40 million sufficient to 
deliver payments to farmers in a timely manner?
    Answer. The emergency funding of $40 million included in the 1999 
appropriations act has allowed FSA to maintain approximately the same 
staffing level in 1999 as in 1998, with some increase in temporary 
staffing early in the fiscal year, which could not be sustained with 
available funding. However, it did not provide for significant 
additional staff to handle the large workload increases associated with 
the new emergency disaster assistance programs or other market-driven 
workload. The additional programs have strained FSA delivery in many 
States. This has compounded backlogs associated with the increased 
activity in loan deficiency payments, marketing loan assistance, other 
assistance activities stemming from low prices, and disaster 
assistance.
    Question. Were you able to increase FSA Federal and non-Federal 
county permanent staff? If so, by what number of full-time equivalents?
    Answer. No, we have not been able to increase FSA permanent 
staffing because of budget levels and five years of downsizing. 
However, the agriculture economic crisis beginning in 1998 accounted 
for a significant short-term increase in temporary non-Federal county 
office employees towards the end of fiscal year 1998 and into the first 
quarter of fiscal year 1999. Federal employees have remained at 
essentially constant levels throughout this same period. [Actual 
employment follows:].

                     FSA NON-FEDERAL COUNT STAFFING
------------------------------------------------------------------------
                                           Fiscal Years (as of 09/30/98)
                  Items                  -------------------------------
                                               1998            1999
------------------------------------------------------------------------
Permanent Employees.....................           9,522           9,425
Temporary Employees.....................           2,522           4,111
                                         -------------------------------
      Total Employees...................          12,670          13,536
------------------------------------------------------------------------


                          FSA FEDERAL STAFFING
------------------------------------------------------------------------
                                           Fiscal Years (as of 09/30/98)
                  Items                  -------------------------------
                                               1998            1999
------------------------------------------------------------------------
Permanent Employees.....................           5,633           5,635
Temporary Employees.....................             335             328
                                         -------------------------------
      Total Employees...................           5,968           5,963
------------------------------------------------------------------------

    Question. I have heard that employee reductions of ``right-sizing'' 
occurred even though the additional monies were appropriated. It was 
the Committee's understanding that this would prevent additional staff 
reductions beyond those expected. Did reductions occur, and if so, what 
were they?
    Answer. FSA began a right-sizing initiative in October of 1998 that 
references relative imbalances of employees to the workload needs in 
individual states. Between October, 1998 to December, 1998, the Agency 
reduced 94 county employees through the process of lowering FTE 
ceilings in overstaffed locations, attrition, and the implementation of 
additional shared-managed field offices. This selective process 
reflects prudent management and allows the hiring of employees at 
understaffed locations within available funding.
    Question. The President's fiscal year 2000 budget request proposes 
a program level of $1 billion, estimated to support a ceiling of 5,745 
Federal staff years and 10,048 non-Federal county staff years. This 
proposal is contingent on the passage of legislation which would allow 
for the Commodity Credit Corporation (CCC) to cover a portion of the 
Farm Service Agency's computer operations and maintenance costs for the 
farm programs. Since the passage of this language does not fall under 
this Committee's jurisdiction, the salaries and expenses account may 
possibly have a shortfall if this proposal is not authorized. What 
shortfall in funding for FSA salaries and expenses will occur if this 
legislation is not authorized?
    Answer. That has not been determined because the size of any 
shortfall would depend entirely on what the Agency decides it could 
forego in essential ADP systems and equipment maintenance costs and for 
automated program delivery application costs that service producers. 
Without the requested CCC ADP cap increase, FSA would have no baseline 
funding for its basic ADP operations for farm programs because these 
have historically been funded by the CCC for CCC programs administered 
through FSA. The existing cap will be exhausted by the beginning of 
fiscal year 2000. Therefore, assuming $35 million would be available 
annually by increasing the cap for a 3-year period, the shortfall could 
range from a highly unrealistic zero-where no maintenance contracts are 
renewed on ADP equipment for example--to $35 million, where the agency 
would decide that it basically cannot operate without minimum essential 
ADP support costs and would reduce personnel in order to fund these 
costs.
    Question. What additional Federal and non-Federal county staff year 
reductions will result from this shortfall?
    Answer: I would refer you to my previous answer.
                           fsa staffing plan
    Question. Why hasn't the Department revised its FSA staffing plans 
that were initially based on the 1994 reorganization plan since 
installation of the information technology system has not yet occurred?
    Answer. Despite our inability to get oversight and Congressional 
approval of the equipment needed for the Common Computing Environment 
(CCE), which would allow us to more closely align personnel to the 1994 
plan, we have to do the best we can for the time being with the 
resources we are given. Until the mid-part of fiscal year 1998, when 
the economic crisis in agriculture began to drive FSA workload upward, 
FSA had managed to basically balance workload with staffing due to the 
lower workload requirements of the 1996 Farm Bill, despite the lack of 
a CCE. This is no longer the case, unless commodity prices improve 
dramatically. The need for a CCE for the county based agencies remains 
a top USDA priority.
                       ccc computer cap increase
    Question. The CCC computer cap increase is contingent on savings 
gained from a reduction in the authorized level for the Export 
Enhancement Program (EEP). This savings is not likely to be scored by 
CBO. Do you have an alternative PAYGO offset?
    Answer. We do not have a specific alternative offset identified at 
this time, however, if necessary we will work with the Congress to 
attempt to identify potential offsets.
                         fsa increased workload
    Question. In the past year what sort of increase in workload have 
you seen at the Federal and non-Federal staff level?
    Answer. With low grain prices and several years of disaster 
conditions, county office workload has increased in the areas of loan 
deficiency applications, marketing assistance loans and the 
implementation of about $6 billion in new disaster assistance program 
legislation. Also, the depressed economic conditions in the 
agricultural sector of the economy are forcing many farmers who 
normally obtain commercial credit to seek direct operating and other 
loan assistance, thereby increasing the workload of the federal farm 
loan program staff that is already stretched too thin, especially in 
performing loan servicing functions.
    Question. What portion of this workload increase results from the 
administration of disaster payments and loan deficiency payments?
    Answer. Compared to the fiscal year 1999 workload estimates 
included in the Administration's fiscal year 2000 budget, FSA is 
projecting a need for an additional 562 FTE's to assist with loan 
deficiency payments, 946 FTE's to assist with the disaster activity, 
and 32 FTE's for additional workload associated with the non-insured 
assistance program.
    Question. Is there enough staff to handle this workload?
    Answer. Clearly, there is not. FSA faces the probability of program 
delivery failure during fiscal year 1999 without additional resources. 
Present county office employees, already dealing with heavy workload 
demands, are under extreme stress trying to keep current and attempting 
to minimize delays in accepting producer applications and finalizing 
payments.
                           watershed projects
    Question. Under the Public Law 534 and Public Law 566 programs, the 
federal government provides local sponsors with 100 percent cost share 
for the construction of flood control projects. The sponsors are 
responsible for acquiring the necessary land rights and for operating 
and maintaining structures based on a signed agreement. In many states 
the sponsors across the country have carried out their responsibilities 
with funds obtained through local taxes. However, some areas have not 
been able to do this, like Mississippi. USDA has proposed in the fiscal 
year 2000 budget request that $1 million be used for educational 
assistance to notify watershed sponsors about the need to inspect and 
rehabilitate the aging dams built during the past 50 years. Please 
explain how this educational assistance will be implemented.
    Answer. The issue of the aging watershed infrastructure is a 
growing concern because of potential safety and health risks to the 
public. Between the 1940's and 1960's local sponsors, with assistance 
from USDA, constructed over 10,000 flood control dams that were 
designed to last 50 years. In the next 10 years (2000-2010) over 1,300 
of these dams will exceed their design life and require major 
renovation or breaching. In addition, many of these dams and others of 
newer design are in a higher risk category due to downstream 
development and will also require major work.
    In order to make the public and sponsors aware of these issues, 
USDA will utilize appropriated funds from the Watershed Operations 
account to conduct multi-state seminars, develop educational materials, 
produce videos and printed materials and send letters to sponsors 
informing them of their responsibilities as owners of dams built under 
the Small Watershed Program. We would utilize conservation partners 
such as state dam officials and private contractors for the majority of 
these efforts.
    Question. Is this the only option considered in the fiscal year 
2000 budget request to working with these communities to address this 
problem nationwide?
    Answer. Yes, the sponsors of dams built under the Small Watershed 
Program are responsible and liable for operation and maintenance, as 
well as compliance with all state and federal laws involving dam safety 
and environmental permits. As a condition of federal funding, the 
sponsors entered into a contract with the agency to operate and 
maintain the structures. Since USDA presently has no statutory 
authority to provide financial assistance for rehabilitation, the 
fiscal year 2000 budget proposes to provide educational assistance.
    Question. Does the Administration have a proposal so that sponsors 
can obtain funding to improve the conditions of these structures?
    Answer. No. However, USDA is exploring ideas on how to assist in 
addressing the problem within current authorities.
    Question. I understand that the Department's position has been that 
should federal funds be provided to those states that did not maintain 
their structures, inequities would exist with sponsors in communities 
in states who fulfilled their responsibilities by providing local 
funding for maintenance.
    Has the Department assessed the number of projects that have not 
been maintained? If yes, please list the states where projects exist, 
the number of projects per state, and cost associated with the 
maintenance of these projects.
    Answer. The issue of the aging watershed infrastructure is 
primarily related to dams exceeding their design life, but operation 
and maintenance of all structures is a part of the issue. The 
Department has not completed a detailed study of the condition of each 
of the more than 10,000 dams built under the Small Watershed Program 
since the dams are not owned, operated nor maintained by the 
Department. The cost to do such a study would be considerable, perhaps 
as much as $10-$12 million.
    However, it is my understanding that USDA/NRCS is currently 
conducting an assessment of rehabilitation needs of dams built under 
the Small Watershed Program in a number of states. This assessment, 
which is only a compilation of known rehabilitation needs, will 
hopefully provide stakeholders with some valuable information on how to 
proceed in the future. I will provide additional information on this 
assessment for the record.
    [The information follows:]

           RAPID ASSESSMENT OF KNOWN DAM REHABILITATION NEEDS
  [Includes only dams built under Public Law 534, Public Law 566, Pilot
Projects, and Resource Conservation and Development authorities of USDA]
------------------------------------------------------------------------
                                         Number of Dams
                                            Needing       Estimated Cost
               State \1\                   Immediate      \2\ (millions)
                                         Rehabilitation
------------------------------------------------------------------------
Alabama...............................               71              $24
Arkansas..............................               77               21
Colorado..............................               49               28
Georgia...............................              334               92
Illinois..............................               36               11
Indiana...............................               41               18
Iowa..................................              284               20
Kansas................................               97               20
Kentucky..............................              101               20
Mississippi...........................              608               34
Missouri..............................              244               21
Nebraska..............................              294                4
New Mexico............................               17               23
New York..............................               53                2
Ohio..................................               46                7
Oklahoma..............................              190               53
Pennsylvania..........................                7                1
Tennessee.............................               43               13
Texas.................................              283               84
Virginia..............................               16               10
West Virginia.........................               34               53
Wisconsin.............................               42                3
                                       ---------------------------------
      Total for these states only.....            2,967              562
------------------------------------------------------------------------
\1\ These 22 states have 10,188 of project dams
\2\ Does not include Operations and Maintenance costs.

                           rural development
    Question. For the guaranteed multifamily housing program, the 
budget proposes to eliminate the statutory requirement that 20 percent 
of the loans guaranteed must receive interest assistance. This 
legislative change would allow for the program's expansion to $200 
million, which is $125 million over 1999.
    Should this statutory requirement not be adopted, what additional 
funding will be required to hold the program level at the fiscal year 
1999 level for fiscal year 2000 and how many rental units would be 
built at this funding level?
    Answer. Assuming that the proposed legislative change is not 
enacted, in fiscal year 2000, $359,000 in budget authority will be 
required to maintain the Section 538 rural rental housing guaranteed 
loan program at its fiscal year 1999 program level of $74,839,000. This 
amount of budget authority represents a decrease of $1,961,000 from the 
1999 level of $2,320,000. A program level of $74,839,000 will build 
approximately 2,010 new apartment units in fiscal year 2000.
    Question. The fiscal year 2000 budget request proposes a total of 
$640 million for rental assistance, of which $440 million will be 
available in 2000 and $200 million will be available in 2001. This 
sounds like some sort of budget gimmick, Mr. Secretary.
    A. Why has the Department proposed to fund this program over two 
years when it has not done so in past years?
    Answer. The Administration's proposal reflects full funding of the 
rental assistance needs for fiscal year 2000. As you note, the budget 
authority for this funding is spread out over two years, specifically 
$440 million for fiscal year 2000 and $200 million for fiscal year 
2001. The way payments are made under the program--in five year 
contracts--allows this form of budgeting. This is a reflection of the 
true cost of the program, which is expressed in the Administration's 
baseline estimates.
    B. Will this proposal affect the delivery of this assistance? If 
not, why?
    Answer. Rental assistance payments are made under five-year 
contracts, and budgeting these payments over two years will not affect 
the flow of rent reductions for the tenants who occupy RHS Section 515 
and Farm Labor Housing complexes.
    Question. The fiscal year 2000 budget also proposed legislation 
authorizing $400 million in direct Treasury rate electric loans. This 
proposal would possibly replace the need for increased funding for the 
highly subsidized direct 5 percent and municipal rate loans.
    A. What demand is there for direct Treasury-rate electric loans?
    Answer. RUS began fiscal year 1999 with a backlog of loan 
applications from electric distribution borrowers totaling $1.2 
billion. Based on past experience, we anticipate receiving 
approximately $800 million additional applications during fiscal year 
1999. The fiscal year 1999 appropriations provides $700 million in 
funding for distribution borrowers. This means RUS will begin fiscal 
year 2000 with a backlog of approximately $1.3 billion in loan 
applications for distribution borrowers. We believe there will be a 
large demand for Treasury rate loans to augment, not replace, the 
municipal rate and hardship rate loans in order to meet the capital 
requirements of the electric distribution borrowers. There will be a 
continuing need for hardship loans in the future.
    B. If this legislative proposal is not adopted, what is the 
anticipated program level need for direct and municipal rate loans for 
fiscal year 2000?
    Answer. The fiscal year 2000 Budget includes $50 million for direct 
5 percent interest rate loans, $250 million for municipal rate loans, 
$300 million for guaranteed loans and $400 million for treasury rate 
loans for a total of $1.0 billion.
                          early warning system
    Question. Please explain the fiscal year 2000 Budget request for $5 
million to fund the early warning system community facility grants that 
would allow rural areas to reduce the loss of life resulting from 
inadequate warnings of hazardous weather.
    Answer. The request for $5 million is to finance the installation 
of radio towers, where necessary, and transmitters connected to the 
NOAA National Weather System radio service which would trigger warnings 
of approaching hazardous weather. Many rural areas are without early 
warning of rapidly approaching weather systems such as the storms that 
hit Mississippi, Tennessee and other areas in January of this year. It 
has been demonstrated that if sufficient warning had been available in 
sites devastated by tornados in the past several years, hundreds of 
lives can be saved and an equal number of injuries avoided. We estimate 
the total cost of providing coverage to 95 percent of the rural areas 
in need to be about $50 million.
                        conservation initiatives
    Question. The fiscal year 2000 budget request includes a $15 
million increase in the Conservation Operations account of the Natural 
Resources Conservation Service. This funding will help support the USDA 
share of the Administration's global climate change initiatives. An 
increase of $3 million will be used to fund demonstration and pilot 
projects to test various carbon sequestration and greenhouse gas 
mitigation strategies and monitoring mechanisms.
    How is this different from the research projects on the greenhouse 
effect that have been ongoing for years now?
    Answer. The $15 million budget request is a substantial increase 
which will allow the agency to begin to develop a soil carbon database 
that represents actual local soil carbon levels under the various 
management and conservation systems that farmers and ranchers apply 
across the nation. This effort will establish the foundation for models 
and inventories that can track actual changes in soil carbon stocks, 
and anticipate changes that might result from potential conservation 
policies. NRCS' ongoing research projects on the greenhouse effect, 
funded at $1.5 million in earlier years and at $1.2 million in fiscal 
year 1998 and fiscal year 1999, focused on the impacts of climate on 
the soil environment.
    Question. How will these projects, if funded, help our nation's 
farmers in the conservation area?
    Answer. The proposed pilots will test and demonstrate not only 
carbon planning and monitoring methodologies under development, but 
they will also test and assess an array of policy and programmatic 
delivery options to help structure future policies and programs to more 
efficiently enhance carbon sequestration. This, in turn, will increase 
rainfall infiltration and water-holding capacity, and improve soil 
fertility, microbial activity and soil structure. These factors improve 
water quality, reduce erosion, reduce the amount of fertilizer inputs 
required to produce a crop and increase resistance to drought.
                             digital earth
    Question. The Administration's fiscal year 2000 request also 
proposes an increase of $5 million as a part of the Administration's 
``digital earth'' vision to enable access and standardization of 
geospatial data supporting Federal, State and local governmental 
programs. What is this initiative? Why is an increase proposed and how 
will these funds be used?
    Answer. This initiative is designed to make geospatial data 
accessible to governments, businesses, academia, and citizens for use 
with innovative tools such as a geographic information system (GIS) to 
address everyday and long-term community issues. Geospatial information 
is key to helping communities analyze complex economic, social and 
environmental concerns in making more informed decisions and adopting 
strategies to support issues such as land-use planning, water quality, 
emergency response planning, environmental management and urban sprawl.
    NRCS would use the $5 million to develop cooperative agreements and 
grants with state and county governments to develop geospatial data. 
The agreements would have two primary purposes. The first would be to 
develop geospatial data layers such as hydrography, roads, watersheds, 
county boundaries, township boundaries, land parcels, and public land 
surveys at a resolution acceptable for use at the local level. The 
second purpose is to assist the state or county in establishing an 
internet web-server in compliance with FGDC Clearinghouse standards. 
These public access web-servers can provide geospatial data to the USDA 
county-based offices and to the public as part of the overall National 
Spatial Data Infrastructure.
                            debt for nature
    Question. The fiscal year 2000 budget request includes a $5 million 
legislative proposal to help implement the ``Debt for Nature'' program. 
This program will provide technical and financial assistance to USDA 
borrowers with serious cash flow problems who also have lands that 
require conservation treatment. Will you please explain how the 
Department will implement this new program?
    Answer. The Debt for Nature program is not a new program but it has 
never been fully carried out. The $5 million is being requested to 
provide financial and technical assistance to financially stressed 
participants to help them establish conservation and wildlife measures 
that may be required in their conservation plan. The program will be 
implemented jointly between FSA and NRCS with NRCS being responsible 
for technical decisions related to the program and FSA being 
responsible for administrative policy and loan-servicing. The agencies 
will work together to establish policies, procedures and direction 
regarding planning, implementation and training.
    Question. Another new program is proposed in the fiscal year 2000 
budget request--a $50 million discretionary Farmland Protection 
Program. This supplements the mandatory program which ran out of money 
last year. The Administration also requests funding authority of $27.5 
million for 2000 for the mandatory program.
    At a time when discretionary money is scarce, why is the 
Administration proposing to supplement the existing Farmland Protection 
Program with discretionary money? Why not an additional $50 million 
increase in mandatory funds?
    Answer. In response to the nationwide surge of public interest in 
preserving landscapes and communities, the Administration is proposing 
the Lands Legacy initiative which would be funded from the Land and 
Water Conservation Fund. As part of the Lands Legacy initiative, $50 
million in discretionary funds are proposed for the Farmland Protection 
Program. Additional mandatory funds for the Farmland Protection Program 
would require an offset from the other mandatory programs funded by the 
CCC account.
    Question. In your statement, you say the program is slated to 
receive $50 million in discretionary funding from the Vice President's 
new Lands Legacy Initiative. What does this mean?
    Answer. One billion dollars are proposed in the Vice President's 
Lands Legacy initiative to strengthen the federal government's role as 
a partner with state and local efforts to build livable communities. 
Most of the programs in this initiative focus on urban revitalization 
and sustainable development. The Farmland Protection Program is one of 
the components and would address urban sprawl issues affecting 
strategic agricultural land. It also is a valuable tool to enhance 
other sustainable development priorities of communities.
    Question. Does this request include technical assistance as well as 
financial assistance?
    Answer. Yes. Included in the $50 million Farmland Protection 
component of the Lands Legacy initiative is $2 million (4 percent) for 
technical assistance.
                      food quality protection act
    The Environmental Protection Agency (EPA) is currently writing 
regulations to implement the Food Quality Protection Act (FQPA). It is 
very important that this law is implemented in such a way that it does 
not negatively affect our nation's farmers.
    Last year, Vice President Gore issued a directive that EPA and USDA 
work together to implement FQPA. In fact, report language was included 
in the fiscal year 1999 conference report concurring with the Vice 
President's memorandum and directing USDA to keep us abreast of its 
activities with EPA. USDA has determined chemical field data over the 
years for farmers and this Committee has provided the needed resources 
to collect that data on chemical use.
    Question. When do you plan to give us a report on your activities 
with EPA to implement FQPA?
    Answer. The report is now being completed by the Department and 
will be provided to you in March. The report will describe our on-going 
activities and additional activities planned for fiscal year 2000.
    Question. Does EPA use the data that USDA has collected when 
determining how farmers use crop protection products?
    Answer. The data are critically important to EPA and are used by 
EPA in assessing possible pesticide risks. The data are equally 
important for planning workable risk mitigation measures. When 
cancellation of a chemical or certain uses of a chemical is the only 
viable approach to reducing risk to acceptable levels, USDA data and 
our land grant partners will be of central importance in the process of 
developing transition strategies.
    Question. What role has the Department played in the implementation 
process of this law? How closely have you worked with EPA?
    Answer. EPA Administrator Browner and I met on February 5, 1999, to 
discuss several aspect of FQPA implementation including the need for 
science-based data. We agreed that it was critical for all risk 
assessments and regulatory decisions to make full use of sound science 
and the best possible data. USDA data concerning pesticide use patterns 
and residue levels along with food consumption constitute critical 
information.
    Question. Are you aware that EPA plans to release ``Interim/
Preliminary'' Re-registration Eligibility Documents (REDs) to the 
public on the internet using default assumptions?
    Answer. One of the first actions of the Tolerance Reassessment 
Advisory Committee (TRAC) was to agree to a pilot effort to make the 
EPA risk assessment process more transparent and to involve more 
stakeholders. Until now, only the chemical registrants had the 
opportunity to review draft risk assessments and influence the 
decision-making process at the early stages of review. Growers and 
others believed that their interests were not adequately represented at 
certain critical decision points. Early examination of the assessments 
will allow for early identification of the needed revisions and 
substitution of actual data to replace default assumptions.
    Question. If I understand this correctly, EPA has not finalized the 
nine-science policies currently being developed by the Tolerance 
Reassessment Advisory Committee (TRAC) that will be used to implement 
FQPA. It concerns me that EPA plans to release these REDs prior to the 
finalization of these policies since it could eventually impact the 
outcome of the regulations. Did EPA consult with the Department before 
this decision was made to release this preliminary information prior to 
the finalization of the science policies?
    Answer. As outlined above, the decision was made as part of the 
TRAC process. As you know, Deputy Secretary Rominger co-chairs that 
Advisory Committee with the EPA Deputy Administrator. It should be 
noted that the preliminary risk assessments are publicly available 
under the Freedom of Information Act. Because not all stakeholders in 
the review process routinely sought copies under FOIA, TRAC 
participants that it was reasonable to make access more convenient for 
all.
    Question. Why is the preliminary information being publicly 
released? Wouldn't it be more prudent to wait until the science 
policies are completed.
    Answer. Because many of the science policies will not be finalized 
for some months, the process of refining the risk assessments will 
include a sensitivity analysis to determine the impact of alternative 
policy choices on the assessments. These will be shared with the public 
and should assist all interested parties in establishing final 
policies.
    The Vice president in his April 8, 1998 directive to EPA and USDA 
concerning implementation of FQPA set forth the following principles:
    (1) Regulatory decisions should be based on the best science and 
data that are available.
    (2) EPA should continue to seek peer review and public review of 
its methods and approaches for analyzing potential risk under the new 
law.
    (3) In translating sound science into regulatory approaches, EPA 
and USDA should ensure that the decisions and positions of the two 
agencies are transparent to affected constituencies.
    (4) Approaches must be clearly and fully communicated in a manner 
that facilitates informed review by all affected constituencies.
    Question. The TRAC process has two more scheduled meeting. The 
development of the most sound science and data have not been finalized, 
and EPA has historically allowed the registrants of chemicals to review 
draft REDs prior to them being released to the public. However, this is 
not the case. Based on this information, doesn't the release of the 
REDs go against the principles set forth by the Vice president in the 
April 8, 1998, directive to EPA and USDA concerning implementation of 
FQPA?
    Answer. Release of the preliminary risk assessments, with the 
careful understanding that the assessments are preliminary and draft 
conclusions are theoretical, answers the Vice President's directive for 
transparency in the risk assessment process.
    Question. How do you propose we proceed in stopping this premature 
release of the REDs to the public?
    Answer. EPA and USDA have stressed that preliminary risk 
assessments do not represent final conclusions and often are based on 
outermost assumptions. These caveats need to be stressed in future 
releases of preliminary risk assessments.
                                 honey
    Question. Section 1122 of the fiscal year 1999 Agriculture 
Appropriations Act provides for the reinstatement of marketing loans 
for honey producers. Congress approved this program because honey 
producers, like those of many other commodities, faced disastrously low 
prices. Yet, the Department has delayed implementing this program for 
months, well beyond the harvest time. These delays have rendered this 
loan program virtually useless. When Chairman Skeen and I learned of 
the Department's misperception of our intent in implementing the 
program, we wrote you to clarify this issue, hopefully ending the 
delays. However, not only have we not received a reply to our letter, 
the regulations implementing this program remain unpublished. What is 
the status of these regulations?
    Answer. We anticipate the final rules implementing the honey 
program will be published within several weeks, and that eligible 
producers will be able to obtain honey recourse loans by requesting 
loans through a period ending 60 calendar days after publication of the 
regulation in the Federal Register.
    Question. How does the Department justify the delays in 
implementing this program which was mandated by Congress, while 
assisting producers of other commodities more expeditiously and without 
specific mandates to do so?
    Answer. Many decisions needed to be made in regard to the Honey 
program which required additional research and legislative 
interpretation. For instance, the Appropriation's Act required that the 
program be operated on a no-net-basis, and that repayment of the loans 
would include interest and administrative costs. The research required 
to define a no-net-cost loan which included administrative costs 
delayed the implementation of the program. Additionally, loan rates, 
regulations, and operating procedures for field offices also had to be 
developed to adequately administer the program.
                    disaster/market loss assistance
    Question. The disaster program enacted in the Omnibus 
Appropriations Act provides the Department with tremendous flexibility 
to design a disaster program which was fair to all commodities in all 
parts of the country. While I appreciate the magnitude of your 
responsibility, I also understand that this was suppose to be an 
emergency program. Do you consider the six months that it will take 
between passage of these funds and when producers will likely receive 
their checks as an acceptable time to deliver ``emergency'' funds?
    Answer. The fiscal year 1999 omnibus appropriations bill created 
seven new programs for the Department of Agriculture (USDA) to 
administer, and of those, the most complex is the crop loss disaster 
assistance program (CLDAP)--the $2 billion earmarked for assisting 
farmers who have suffered crop losses over multiple years before 1998 
or who had losses only in 1998. It is far more complex than past 
natural disaster assistance programs. Consequently, and due to the 
heavy demand from farmers, USDA is taking longer than we anticipated to 
implement it fully. Nonetheless, I want to assure you that getting 
these payments out as expeditiously and as fairly as possible is a top 
personal priority for me.
    Question. It is my understanding that as of last week, county 
offices did not have the necessary forms for producers to apply for 
these disaster funds. Further, it is my understanding that many county 
offices may not have the necessary computer software to process these 
applications today. How does the Department justify this?
    Answer. Applications have been available in the county office and 
on the internet since the first week of signup and manual forms were 
available to calculate 1998 single year payments for noninsurable and 
uninsured crops. However, information was not available for each 
producer to enable the county offices to calculate an estimated 1998 
single year payment for insured crops without asking the producers for 
production information. A significant amount of time has been devoted 
to providing county offices with producer loss information from RMA and 
FSA's national data base to reduce the burden on producers of having to 
provide the information for the disaster programs and to determine 
eligibility for multi-year payments. Millions of RMA and FSA records 
are being downloaded to county offices. We believe that the start up 
time was essential to provide better service to the producers.
    Question. Milk prices to farmers are expected to decline about 30 
percent over the next several months. When will you announce the plan 
for disbursing the $200 million in dairy market loss assistance funds?
    Answer. The fiscal year 1999 appropriations act requires that the 
assistance be made ``as soon as practicable'', but does not specify 
what form the assistance should take, nor how the funds should be 
distributed. The law does stipulate however, that the payments shall 
not affect any regulatory decision on milk marketing order reform. A 
full range of possibilities for efficient use of the funding is under 
consideration. The expected record decline in the February basic 
formula price and the resultant record decline in farmers' milk checks 
in April has accelerated the Department's development of the program. 
The program may be announced in March.
    Question. In fiscal year 1999 Agriculture Appropriations Act, there 
was emergency feed assistance funding. According to reports from 
farmers, the deadline date has been extended twice already this year. 
When can farmers expect to receive this assistance?
    Answer. On November 12, 1998, USDA announced the Livestock 
Assistance Program (LAP) and began taking applications on November 23, 
1998. To accommodate the extremely high demand for LAP, USDA extended 
the sign up for this program and now plans to close enrollment on March 
25, 1999. USDA will issue payments shortly thereafter. We estimate that 
the $200 million Congress appropriated for livestock assistance will be 
heavily over-subscribed and USDA, consequentially, will be able to pay 
only a portion of the total request.
    Question. It is my understanding that producers who apply for USDA 
disaster loans have had their loan proceeds reduced by the amount of 
crop insurance indemnity payments they have received. Is this true?
    Answer. Yes. The amount of a Farm Service Agency (FSA) emergency 
loan received by a family farmer is reduced by the amount of crop 
insurance payments that have been received.
    Question. How does this help producers who need these loan proceeds 
to finance their operation?
    Answer. A family farmer who receives crop insurance indemnity 
payments and a FSA emergency loan has been totally compensated for 
their loss by the combination of a loan and direct payments. Additional 
financing needs can be met with either a loan guarantee or a direct 
loan from the FSA.
                            commodity prices
    Question. Mr. Secretary, one of the factors which led Congress to 
pass the agriculture assistance package last year was the state of 
commodity prices for almost every crop. Current estimates do not appear 
to be much better for 1999. The President's budget makes no specific 
recommendations on how to improve the current crop insurance system to 
give farmers price risk protection. Further, any change in the law 
enacted by Congress will not likely be able to help farmers for the 
1999 crop. What changes do you specifically propose to improve crop 
insurance?
    Answer. On February 1, 1999, the Department released a white paper 
entitled ``Strengthening the Farm Safety Net: The Administration's 
Principles and Preliminary Proposals for Reforming Crop Insurance.'' A 
copy of this paper is submitted for the record. The Administration 
proposes a dialogue with the Congress with regard to strengthening crop 
insurance in several key areas. Briefly, these are:
 --Speed new, more flexible risk management tools to market by 
        providing incentives to commercial insurers to develop 
        insurance policies that meet the needs of producers.
 --Make the level of protection under the catastrophic insurance 
        coverage and the Non-insured Assistance Program (NAP) more 
        meaningful in terms of replacing farm income in disaster years.
 --Increase the incentives for producers to purchase higher levels of 
        insurance protection.
 --Cover multi-year disasters so that the cumulative effects of several 
        disasters within a short number of years are mitigated.
 --Extend insurance protection to livestock.
 --Improve the NAP program by making the determinations more flexible 
        than is possible with the current area trigger.
 --Provide better information and services to farmers and ranchers so 
        that they will better understand and manage the risks that 
        confront them.
    Question. How can the rating inequities that disadvantage southern 
farmers be eliminated?
    Answer. Premium rates are calculated by the Federal Crop Insurance 
Corporation (FCIC) from the experience it has accrued in a county. High 
premium rates result from high losses paid in the past. For many 
reasons, losses have been claimed by producers in the South more 
frequently and at much greater levels of crop loss than has been 
observed in other sections of the country. While some may view the 
resultant high premium rates as an inequity, insurance principles 
dictate that the premium rate be commensurate with the level of 
expected losses.
    Many in the South allege that the insurance experience on which the 
present rates are based is not representative of the ``good'' farmer--
that it is based on producers who deliberately made false reports of 
losses. FCIC did eliminate losses attributed to persons identified 
under its former Non-standard Classification System from the experience 
used to calculate premium rates for the remaining producers. However, 
losses still remain higher than is typical for other areas and crops.
    USDA is willing to work with the Congress to find a solution to 
this persistent problem. If farmers are aware of individuals who are 
inflating losses, we would appreciate such information. Insurance fraud 
will not be tolerated, as it costs all producers.
    Question. The Budget makes no recommendations for offsets to pay 
for any changes to crop insurance statutes. I understand that several 
billion dollars will be necessary. How does the Department propose to 
pay for these improvements?
    Answer. In its white paper ``Strengthening the Farm Safety Net,'' 
the Administration states its intentions to seek a consensus among 
producers, the Congress, and other stakeholders as to the nature of the 
changes needed. Once that consensus is built, agreement will be needed 
on the difficult task of finding the best way to finance those 
improvements. We plan to work with Congress in a responsible manner 
regarding this issue.
    Question. What other action outside of crop insurance does the 
Department propose to improve commodity prices?
    Answer. While crop insurance is the centerpiece of the 
Administration's effort to improve the safety net for farmers, the 
Department is looking at a broad range of other ideas, including 
allowing farmers to extend the due dates on market assistance loans and 
paying for on-farm storage facilities. There are a number of additional 
proposals, most requiring Congressional action, some of which may have 
been debated in the not too distant past which may be worth a 
reexamination such as modification of the caps on marketing loan rates. 
And, perhaps, there is interest in recent proposals by members of 
Congress to develop additional short to intermediate term land 
retirement programs which could be tailored to address multiple 
objectives including crop disease contract and investments benefits 
which would be removing crop acreage from production. Many of these 
efforts would involve significant costs.
    Strong export markets are another important component of the 
agricultural safety net and are critical for the support they lend to 
domestic commodity prices. In response to weakened foreign demand, we 
have taken a number of important steps over the last year to bolster 
exports and maintain access to key foreign markets. In response to the 
Asian financial crisis, we increased substantially the level of export 
credit guarantees made available by CCC, and sales registrations under 
the program during fiscal year 1998 were 40 percent higher than the 
year before. We anticipate this expanded level of programming will 
continue in both 1999 and 2000.
    We are implementing the President's Food Aid Initiative, under 
which 5 million metric tons of wheat and wheat products are being made 
available for donation overseas. Also, we have developed and are 
carrying out a major package of food assistance for Russia in order to 
assist that country and maintain access for our products. Russia is an 
important market for U.S. grains, poultry, pork, and beef, and we want 
to assist it in regaining its status as a commercial purchaser.
    Over the long term, the best means of ensuring expanded access to 
overseas markets for our farmers and ranchers is through the 
negotiation of improved market access and a reduction in trade 
barriers. Therefore, we are working vigorously to open and expand 
markets through a wide range of trade policy activities. Most note 
worthy of these is our preparation for the new round of multilateral 
trade negotiations which is set to begin later this year. These 
negotiations present an important opportunity to strengthen disciplines 
on agricultural trading practices and gain improved access to world 
markets for our products.
                                 dairy
    Question. In January 1998, the Department published its proposed 
rule for the Federal Milk Marketing Order system. Sixty-one members of 
the Senate and 238 members of the House of Representatives have written 
you to oppose your endorsement of the so-called option I-B and 
supporting the implementation of option I-A.
    Congress thoroughly debated the elimination of class-I 
differentials during consideration of the 1996 farm bill and rejected 
their elimination. In addition, Congress mandated the release of the 
final proposal for early this year in order to ensure Congress has the 
opportunity to review the proposal while it is in session.
    Question. How do you justify the adoption of option I-B when the 
Department's own analysis showed that option I-B would reduce farmer 
income?
    Answer. In January 1998, USDA issued a proposed rule that 
consolidated the current 31 Federal milk orders into 11 orders, set 
forth two options for replacing the Class I price structure, and 
proposed replacing the BFP. USDA indicated a preference for the Class I 
price surface identified at option I-B when the proposed rule was 
published because as stated in the proposed rule ``It is expected that 
the additional market orientation offered by option I-B will promote 
market efficiencies and lead to better allocation of resources over 
time.'' Since option I-B lowered farm income relative to the current 
Class I price structure, USDA also proposed several transition 
alternatives that would have phased in the option I-B price surface 
over several years, lessening the effects of adopting option I-B on 
farm milk prices and farm income.
    Question. Do you still support option I-B, given the Congressional 
support that has been expressed for option I-A?
    Answer. All the comments are being considered in arriving at the 
final decision.
    Question. What is the timetable for publication of the final 
proposal?
    Answer. The final decision on Federal order consolidation and 
reform, which will be released on or before April 4th, will be based on 
the comments received on the proposed rule.
                               detailees
    Question. Provide a list, by USDA agency, of each employee detail 
or assignment (by employing agency, title, and position) in each of 
fiscal years 1998 and 1999 to date for a period of up to 30 days, and 
identify the agency to which that detail or assignment was made and the 
purpose of the detail assignment. Provide this same information for 
employee details/assignments made for a period of more than 30 days, 
and indicate the dollar amount of reimbursement made to the employing 
agency for each detail/assignment.
    Answer: We will provide that information for the record.
    [The information follows:]

                                                                        DETAILED FOR MORE THAN 30 DAYS--FISCAL YEAR 1998
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
         Position/agency                          Detailed to                          Date/length                                  Purpose                                   Reimbursed
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
William Digdo (GIPSA)............  APHIS....................................  15 days.....................  APHIS Medfly...........................................  $3,837
Michael Haley (GIPSA)............  APHIS....................................  15 days.....................  APHIS Medfly...........................................  $3,934
James Ledoux (GIPSA).............  APHIS....................................  20 days.....................  APHIS Medfly...........................................  $2,993
Bradley O'Neal (GIPSA)...........  APHIS....................................  15 days.....................  APHIS Medfly...........................................  $3,118
Robert Simpson (GIPSA)...........  APHIS....................................  2 days......................  APHIS Medfly...........................................  $411
Dan White (GIPSA)................  APHIS....................................  2 days......................  APHIS Medfly...........................................  $441
Sylvia Magbanua (NASS)...........  Office of Civil Rights...................  28 days.....................  Civil Rights training program..........................  ...........................
N. Blair (FS)....................  Office of the Secretary..................  10/6/97 to11/6/97...........  Civil Rights Action Team...............................  ...........................
G. Renteria (FS).................  Office of the Secretary..................  11/3/97 to 11/20/97.........  Civil Rights Action Team...............................  ...........................
M. Warren (FS)...................  Natural Resources and Environment........  10/01/97 to 10/24/97........  Support................................................  ...........................
Special Assistant to Adm. (FSA)..  White House..............................  10/01/97 to 9/30/98.........  Personnel liaison for all White House personnel of       $73,638 Est. Reimb. limited
                                                                                                             Cabinet agencies and Boards and Commissions within       by 3 U.S.C. 112)
                                                                                                             assigned portfolio.
Computer Specialist (FSA)........  OSEC/Modernizatio n of Admin. Processes    01/19/98 to 5/09/98.........  To provide Agency expertise to MAPP project managers...  $20,519 Est.
                                    Program MAPP).
Management Analyst (FSA).........  U.S. Environmental Protection Agency.....  10/01/97 to 11/22/97........  Assisted in the Information Resources Management Policy  $15,409
                                                                                                             area involving contract resources.
Confidential Assistant to          Rural Development, Office of Community     10/01/97 to 9/30/98.........  To assist the Empowerment Zone initiative in helping     $88,500 Est.
 Administrator (FSA).               Development.                                                             the program/communities achieve economic and
                                                                                                             sustainable development.
Confidential Assistant to          Office of Communications, Photography      10/01/97 to 9/30/98.........  Provide Agency expertise to the Photography Division...  $52,000 Est.
 Administrator (FSA).               Division.
Director, Performance Engineering  NASA, Ames Research Center...............  02/01/98 to 5/23/98.........  Provides assistance on the planning, technical           $33,000 Est.
 and Analysis Group (FSA).                                                                                   guidance, and direction of the Independent
                                                                                                             Verification and Validation (IV&V) facility
                                                                                                             operations..
Robert Cummings (FAS)............  Office of the U.S. Trade Representative..  2 years 6/97--6/99..........  Work on agricultural trade issues......................  Non-reimbursable
Nancy Hirchhorn (FAS)............  The World Bank...........................  1 year 7/97--7/98...........  Articulate USDA interests on project activities........  Non-reimbursable
Stephen Huete (FAS)..............  Inter-American Development Bank..........  1 year 8/97--8/98...........  Articulate USDA interests on project activities........  Non-reimbursable
David Schoonover (FAS)...........  Office of the U.S. Trade Representative..  2 years 6/97--6/99..........  Work on agricultural trade issues......................  Non-reimbursable
Ragiv Rastogi (RUS)..............  Foreign Agricultural Service.............  39 months...................  .......................................................  $252,549
Thomas Bennett (RHS).............  Natural Resources Conservation Service...  1 yr. to date Temporary       Test Laboratory Peoplesoft)............................  ...........................
                                                                               Promotion.
LaJaycee Brown (RHS).............  White House..............................  180 days....................  Communications-Schedule C..............................  ...........................
Marylan Chapman (RHS)............  Under Secretary's Office.................  120 days....................  Women in Agriculture Initiative........................  ...........................
Cheryl Cook (RHS)................  Office of the Secretary, Assistant         45 days.....................  Administrative Convergence-Schedule C..................  ...........................
                                    Secretary for Administration.
Carolyn Cooksie (RHS)............  Farm Service Agency......................  2 years.....................  Minority Farming.......................................  ...........................
Stan Gray(RHS)...................  Office of the Secretary, Chief             3 months to date............  Business Process Reengineering.........................  ...........................
                                    Information Officer.
Debbie Matz (RHS)................  Farm Service Agency......................  2 years.....................  Loan Resolution Task Force--Political Appointee........  $110,000
Debbie Matz (RHS)................  Office of the Secretary, Assistant         5 months....................  Deputy Asst. Secy for Administration-Political           $96,411
                                    Secretary for Administration.                                            Appointee.
Mary McNeil (RHS)................  Office of Congressional Relations-         2 years to date.............  Communications-Schedule C..............................  $120,089
                                    Intergovernmental Affairs.
Angela Morrall (RHS).............  Office of the Secretary, Assistant         40 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Charles Wehrwein (RHS)...........  Housing & Urban Development..............  90 days.....................  Housing Initiative.....................................  $25,000
Karen Murray (RBS)...............  Extension Service........................  9 months to date............  Partnering.............................................  $52,000
Carolyn Parker (RBS).............  Office of the Secretary, Assistant Secre-  2 months to date............  Civil Rights Outreach..................................  $73,733
                                     tary for Administration Office of
                                    Outreach.
Carolyn Parker (RBS).............  Deputy Administrator, Office of Assistant  9 months....................  Civil Rights Implementation Team.......................  ...........................
                                    Secretary.
Vivian Peters (RBS)..............  Foreign Agricultural Service.............  120 days to date............  Scheduler-Schedule C...................................  $50,997
Samantha Speight (RBS)...........  White House..............................  180 days....................  Scheduler..............................................  ...........................
K. Basu (FSIS)...................  Food & Ag Council........................  2/98--2/99..................  Civil Rights Assistance................................  Agreement developed
P. Cohen (FSIS)..................  DOJ/Criminal Division....................  12/97--6/98.................  Assistance in the development of strategic plans for     None determining if detail
                                                                                                             projects.                                                benefits FSIS)
M. Eldakdoky (FSIS)..............  FAS......................................  3/96--5/31/98...............  Food technology support................................  Detail benefits FSIS
J. Gettleman (FSIS)..............  DA: Appeals & Grievances Staff...........  1/98--4/7/98................  Senior Staff Assistance................................  None--just received SF-52--
                                                                                                                                                                      determining if detail
                                                                                                                                                                      benefits FSIS
F. Gwozdz (FSIS).................  ARS......................................  1/97--5/98..................  Staff Assistance.......................................  Detail benefits FSIS
C. Romeo (FSIS)..................  Office of Under Secretary for Food Safety  10/97--3/98.................  Unclassified Duties....................................  Detail benefits FSIS
L. Wright (FSIS).................  Departmental Administration..............  3/97--12/97.................  To work on a CRIT......................................  Detail benefits FSIS
Stephen Balson (FNS).............  USDA/OCFO................................  10/01/96 to 9/30/98.........  FISVIS.................................................  $118,362
Lawrence Blim (FNS)..............  USDA/OCFO................................  10/1/96 to 9/30/98..........  FISVIS/Accounting Standards Manual.....................  $105,593
Renee Brown (FNS)................  Under Secretary/FNCS.....................  10/6/97 to 1/13/98..........  Secretarial Support....................................  $5,732
Kathleen Crampton (FNS)..........  USDA/OCFO................................  10/1/96 to 9/30/98..........  FISVIS.................................................  $91,752
Daniel Dager (FNS)...............  Under Secretary/FNCS.....................  10/1/96 to 3/24/98..........  Budget & Legislative Support...........................  $33,582
Bruce Klein (FNS)................  US Congress/Joint Econ Committee.........  10/20/97 to 2/20/98.........  Analytical Support.....................................  $30,152
Jane Manley (FNS)................  Under Secretary/FNCS.....................  10/6/97 to 12/20/97.........  Secretarial Support....................................  $8,537
Sharon Phillips (FNS)............  USDA/FSIS................................  4/21/97 to 1/17/98..........  Secretarial Support....................................  $16,711
Ismael Tercero (FNS).............  DHHS.....................................  10/1/96 to 10/13/97.........  Tribal Health Programs.................................  $1,542
Velma Brooks (NRCS)..............  FISVIS...................................  10/1/97 to 9/30/98..........  To provide clerical assistance.........................  $38,703
Rebekah Davis (NRCS).............  FAS......................................  1/20/98 to 5/20/98..........  To provide research and writing support................  $7,000
Pam Folson (NRCS)................  USDA/DAMS................................  6/29/97 to 9/3/98...........  Provides support to the Office of the Senior Policy      $37,417
                                                                                                             Advisor for Service Implementation and to serve on
                                                                                                             Team I of the Admin. Convergence.
Lois Loser (NRCS)................  USDA/NSD.................................  9/29/97 to 6/20/98..........  Provides technical support and is Acting Branch Chief..  $68,032
Robert Reaves (NRCS).............  USDA/Administrati ve Management Serv-      6/22/97 to 3/1/98...........  Provides leadership and direction to staff, assign       $43,427
                                    ice.                                                                     work, set goals, participates in Departmentwide and
                                                                                                             Governmentwide multi-organization project.
John Sutton (NRCS)...............  FAS/ICD/DRD..............................  8/21/97 to 8/31/99..........  Detailed to acting Branch Chief NTE 2 years............  $95,529
Joan Conway (ARS)................  FAO......................................  9/97-- Present..............  Special Management Intern Program......................  --
Robert Harmon (ARS)..............  FSIS.....................................  7/96-- Present..............  Training and to provide support to Microcomputer         $25,613
                                                                                                             Support Section.
Stephen Heller (ARS).............  NIST.....................................  10/97-- Present.............  To exchange high level expertise and knowledge related   $59,228
                                                                                                             to leading edge technology.
Al Kemezys (ARS).................  MAPPS....................................  8/96--12/97.................  Provide support for MAPPS..............................  $75,222
Adrienne Labega (ARS)............  Metro Area Reemployment Center...........  8/97-- Present..............  Nonreimbursable--medical accommodation.................  ...........................
Carl Momberger (ARS).............  MAPPS....................................  11/96-- Present.............  Provide technical expertise on MAPPS...................  $96,033
Anne Riordan (ARS)...............  USDA, Procurement Policy Division........  11/97-- Present.............  Provide support to Phase II of USDA Procurement          --
                                                                                                             Modernization Project.
Charlotte Sorrentino (ARS).......  Office of the Secretary..................  7/97-- Present..............  Provide administrative support.........................  Reimbursement being
                                                                                                                                                                      requested
James Spurling (ARS).............  Under Secretary for Research, Education,   8/97-- Present..............  Mission Support........................................  --
                                    and Economics.
Mitch Geasler (CSREES)...........  Under Secretary for Research, Education,   10/97-- Present, half  time.  Mission Support........................................  ...........................
                                    and Economics.
Mary Humphreys (CSREES)..........  Under Secretary for Research, Education,   10/97--9/98.................  Secretarial support, Secretary, Research, Education,     Reimbursement requested
                                    and Economics.                                                           and Economics.
Dafina Williams (CSREES).........  Under Secretary for Research, Education,   11/97--11/98................  Secretarial support, Under Secretary, Research,          Reimbursement requested
                                    and Economics.                                                           Education, and Economics.
Audrae Erickson (ERS)............  USTR Office of Agricultural Affairs        3 months....................  Agricultural Trade.....................................  ...........................
                                    (White House).
Paul Flaim (ERS).................  President's Council on Sustainable         8 months....................  White House Committee on Sustainable Development.......  ...........................
                                    Development (White House).
Christian Foster (ERS)...........  FAS......................................  9 months....................  To work as an agribusiness policy analyst with USAID/    $111,490
                                                                                                             Global Bureau.
Keith Fuglie (ERS)...............  Council of Economic Advisers White         9 months....................  Senior Economist for Agriculture and Natural Resources.  ...........................
                                    House).
Carl Mabbs-Zeno (ERS)............  USDA/FAS/ICD.............................  1 month.....................  To work under the Environment and Natural resources      $10,650
                                                                                                             project.
Sara Mazie (ERS).................  USDA/REE/OSEC............................  10/1/96--Present............  Mission Support/Budget Coordination....................  ...........................
Toni Bradly (NASS)...............  Office of Civil Rights...................  120 days....................  Civil Rights enforcement support.......................  ...........................
Jorge Garcia-Pratts (NASS).......  CSREES...................................  261 days....................  USDA Liaison to the University of Puerto Rico..........  $95,000
Craig Kirby (AMS)................  Assistant SecretaryMRP...................  9/22/97 to present..........  Provide support to the Asst. Secy......................  ...........................
Mark Kreaggor (AMS)..............  MAP, then PACC...........................  10/1/97 to..................  Assist MAP and PACC with Time & Attendance BPR Project.  $8,000
Kevin Clarke (APHIS).............  OCIO.....................................  10/1/97 to Present..........  USDA Enterprise Network design team....................  ...........................
Evelyn Davis (APHIS).............  OCIO.....................................  11/1/97 to 9/30/98..........  Assist with USDA Program...............................  $69,909
Walter Moczydlowsky (APHIS)......  OCIO.....................................  10/1/97 to Present..........  USDA Enterprise Network design team....................  ...........................
Karen Murray (APHIS).............  OCFO.....................................  10/1/97 to 9/30/98..........  Assist with USDA financial systems development.........  $77,382
Patricia Peer (APHIS)............  Assistant Secretary-MRP..................  12/21/97 to Present.........  Provide support to the Assistant Secretary.............  ...........................
Frank Sanders (APHIS)............  OCFO.....................................  10/1/97 to 9/30/98..........  Assist with USDA financial systems development.........  $61,999
Joe Taylor (APHIS)...............  OPPM.....................................  2/97 to 9/98................  VISA card implementation...............................  ...........................
Mary Carmouche (GIPSA)...........  APHIS....................................  73 days.....................  APHIS Medfly...........................................  $7,340
Michael Caughlin (GIPSA).........  FAS......................................  10/1/97--7/1/98.............  Agribusiness Advisor...................................  $97,500
John Cox (GIPSA).................  APHIS....................................  115 days....................  APHIS Medfly...........................................  $6,183
Roy Johnson (GIPSA)..............  APHIS....................................  147 days....................  APHIS Medfly...........................................  still on detail
William Napoleon (GIPSA).........  APHIS....................................  73 days.....................  APHIS Medfly...........................................  $13,642
Wanda Pitiman (GIPSA)............  APHIS....................................  73 days.....................  APHIS Medfly...........................................  $7,976
Steve Reams (GIPSA)..............  APHIS....................................  147 days....................  APHIS Medfly...........................................  still on detail
Mark Reimer (GIPSA)..............  APHIS....................................  73 days.....................  APHIS Medfly...........................................  $8,686
George Wright (GIPSA)............  APHIS....................................  37 days.....................  APHIS Medfly...........................................  $2,425
Marci Hilt OC)...................  DA.......................................  5 months....................  Civil Rights Action Team (CRAT)........................  $38,995
Barnedia Talley (OCFO)...........  ASA......................................  3 months....................  Civil Rights Implementation Team.......................  $9,000
Frances Trout (OCFO).............  OSEC.....................................  Being Negotiated............  Travel Assistance......................................  ...........................
Jeff Knishkowy (OGC).............  Office of Acting Assistant Secretary for   1/13/97 to 1/31/98..........  Provide assistance to the Civil Rights Action Team to    ...........................
                                    Administration.                                                          include implementation of recommendations.
John Lom (OGC)...................  U.S. Trade Representative Office.........  10/20/97 to 3/19/98.........  To better serve USDA in dealing with international       ...........................
                                                                                                             trade disputes and related matters.
Lauretta Miles (OIG).............  USDA/Office of the Secretary.............  1/18/98 to 6/20/98..........  To provide six month detail assignment to perform        $17,000
                                                                                                             clerical duties.
Robert Franco (DA)...............  OPM......................................  2/17/97 to NTE 2 yrs........  Develop SES Recruitment Strategies.....................  $116,495
J. Phelps (DA)...................  OCFO.....................................  12 months...................  Financial Info. Systems Vision project FISVIS).........  $48,000
C. Bailey (FS)...................  Office of the Secretary..................  10/1/97 to 1/2/98...........  Civil Rights Action Team...............................  ...........................
A. Brown (FS)....................  Office of the Chief Financial Officer....  10/1/97 to 9/30/98..........  FS Liaison.............................................  $71,000
J. Comanor (FS)..................  Natural Resources Conservation Service...  10/1/97 to present..........  Support................................................  $70,000
J. Dudley (FS)...................  Office of Operations.....................  10/1/97 to 3/27/98..........  FS Liaison.............................................  $47,116
M. Fletcher (FS).................  Office of the Secretary..................  10/12/97 to 1/2/98..........  Civil Rights Action Team...............................  ...........................
C. Franz (FS)....................  Modernization of Administrative Proces-    10/1/97 to 1/2/98...........  Civil Rights Action Team...............................  $88,000 est.
                                    ses.
J. Gavin (FS)....................  Office of the Chief Information Office...  10/1/97 to 3/31/98..........  Support................................................  $31,000
M. Hamilton (FS).................  Office of the Secretary..................  10/1/97 to 11/30/97.........  Civil Rights Action Team...............................  ...........................
T. Harwood (FS)..................  Hazardous Waste Management...............  10/1/97 to present..........  FS Liaison.............................................  $123,300
J. King (FS).....................  Office of the Chief Financial Officer....  10/1/97 to present..........  FS Liaison.............................................  $88,000
Z. Okrak (FS)....................  Office of the Chief Financial Officer....  10/1/97 to present..........  FS Liaison.............................................  $74,000
B. Preston (FS)..................  Natural Resources and Environment........  10/1/97 to Present..........  FS Liaison.............................................   C.
Pytel (FS).......................  Assistant Secretary (ADM)................  10/1/97 to 1/3/98...........  Acting Deputy Assistant Secretary for Administration...  $38,212
V. Ross (FS).....................  Office of the Secretary..................  10/1/97 to 12/31/97.........  Civil Rights Action Team...............................  ...........................
G. Sundstrom (FS)................  Hazardous Waste Management...............  10/1/97 to present..........  FS Liaison.............................................  $85,860
B. Velde (FS)....................  Hazardous Waste Management...............  10/1/97 to present..........  FS Liaison.............................................  $96,484
K. Waldvogel (FS)................  Hazardous Waste Management...............  10/1/97 to present..........  FS Liaison.............................................  $83,656
S. Yaddof (FS)...................  Cooperative State Research, Educ. And      10/1/97 to 1/31/98..........  Support................................................  $25,000
                                    Ext. Srvc..
J. Zeller (FS)...................  Office of the Secretary..................  10/1/97 to 11/7/97..........  Civil Rights Action Team...............................  Detailed for More than 30
                                                                                                                                                                      Days
Special Assistant to               White House..............................  10/01/96 to 09/30/97........  Personnel liaison for all White House personnel of       $71,071 (Reimb. limited by
 Administrator (FSA).                                                                                        Cabinet agencies and Boards and Commissions within       3 U.S.C.112)
                                                                                                             assigned portfolio..
Supervisory Computer Specialist    OSEC/Modernizati on of Administrative      10/01/96 to 9/30/97.........  To provide Agency expertise to MAPP project managers...  $85,042
 (FSA).                             Processes Program MAPP).
Supervisory Systems Accountant     Alternative Agricultural Research and      03/09/97 to 5/03/97.........  To develop the format for the AARC financial statements  $17,816
 (FSA).                             Commercialization Corporation (AARC).                                    for fiscal year 1997 and provide guidance on
                                                                                                             accounting principles as they ralate to government
                                                                                                             corporations.
Confidential Assistant to Adm.     Rural Development Office of Community      04/11/97 to 9/30/97.........  To assist the Empowerment Zone initiative in helping     $31,025
 (FSA).                             Development.                                                             the program/ communities achieve economic and
                                                                                                             sustainable development.
Computer Specialist (FSA)........  OSEC/Modernization of Administrative       01/19/97 to 9/30/97.........  To provide Agency expertise to MAPP project managers...  $45,748
                                    Processes Program MAPP).
Management Analyst (FSA).........  Office of the Chief Information Officer..  02/24/97 to 8/18/97.........  To assist in the development and implementation of       $45,270
                                                                                                             USDA's Information Systems Technical Architecture and
                                                                                                             Information Technology Capital Planning, and
                                                                                                             Investment Control projects.
Robert Cummings (FAS)............  Office of the U.S. Trade Representative..  6/97--6/99..................  Work on agricultural trade issues......................  Non-reimbursable
Nancy Hirschhorn (FAS)...........  The World Bank...........................  7/97--7/98..................  Articulate USDA interests on project activities........  Non-reimbursable
Stephen Huete (FAS)..............  Inter-American Development Bank..........  8/978/98....................  Articulate USDA interests on project activities........  Non-reimbursable
David Schoonover (FAS)...........  Office of the U.S. Trade Representative..  6/976/99....................  Work on agricultural trade issues......................  Non-reimbursable
Ragiv Rastogi RUS)...............  FAS......................................  39 months...................  .......................................................  $252,549
David Adams (RHS)................  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Victor Agresti (RHS).............  Department of Justice....................  90 days.....................  In advance of his permanent reassignment...............  $20,000
Joyce Allen (RHS)................  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Steve Anaya (RHS)................  Office of the Secretary, Assistant         90 days.....................  Civil Rights Action Team CRAT).........................  ...........................
                                    Secretary for Administration.
Tracey Anderson (RHS)............  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Mark Brad Benson (RHS)...........  Center for Rural Pa......................  3-1/2 years.................  Partnering Intergovt Pers ActIPA)......................  ...........................
Terry Bishop (RHS)...............  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Edith Brown (RHS)................  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Rhonda Brown (RHS)...............  Office of the Secretary, Assistant         5 weeks.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Helen Cordero (RHS)..............  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Angela Corley (RHS)..............  Office of the Secretary, Assistant         120 days....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Mary Fox (RHS)...................  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Leonard Hardy, Jr. (RHS).........  Office of the Secretary, Assistant         90 days.....................  Civil Rights Action Team CRAT).........................  ...........................
                                    Secretary for Administration.
Carlton Lewis (RHS)..............  Office of the Secretary, Assistant         90 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Jacquiline Micheli (RHS).........  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Mary Parker (RHS)................  Office of the Secretary, Assistant         60 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
S. Leanne Powell (RHS)...........  White House..............................  180 days....................  Women's Issues Program-Schedule C......................  ...........................
John Soles (RHS).................  Rural Center, NC.........................  4 years.....................  Partnering Intergovt Pers ActIPA)......................  ...........................
Joseph Taggert (RHS).............  Office of Congressional Relations-         11 months...................  Communications-Schedule C..............................  ...........................
                                    Intergovernmental Affairs.
Quinton Wilform (RHS)............  Office of the Secretary, Assistant         150 days....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
James Coyle (RBS)................  USDA National Service....................  7 months....................  America Reads and Gleaning.............................  ...........................
Amy Donoghue (RBS)...............  Extension Service........................  120 days....................  Partnering.............................................  $11,000
Stephen Balsan (FNS).............  USDA/OCFO................................  10/1/96 to 9/30/98..........  FISVIS.................................................  $108,424
Jordan Benderly (FNS)............  DOJ......................................  10/1/96 to 1/3/97...........  Financial Crime Enforcement............................  ...........................
Lawrence Blim (FNS)..............  USDA/OCFO................................  10/1/96 to 9/30/98..........  FISVIS/Accounti ng Standards Manual....................  $77,420
Gail Brown (FNS).................  Under Secretary FNCS.....................  10/1/96 to 10/5/97..........  Deputy Under Secretary Administrative Support..........  $3,754
Donna Buntrock (FNS).............  Under Secretary FNCS.....................  10/1/96 to 2/24/97..........  Administrative Suppport................................  ...........................
Kathleen Crampton (FNS)..........  USDA/OCFO................................  10/1/96 to 9/30/98..........  FISVIS.................................................  $83,316
Daniel Dager (FNS)...............  Under Secretary FNCS.....................  10/1/96 to 3/24/98..........  Budget & Legislative Support...........................  $29,120
Dorothy Ford (FNS)...............  Under Secretary FNCS.....................  10/1/96 to 9/21/97..........  Legislative Support....................................  ...........................
Donna Hines (FNS)................  USDA/Office of Comm......................  10/1/96 to 9/30/97..........  Americorp Program Activities...........................  ...........................
Kelly Jackson (FNS)..............  Under Secretary FNCS.....................  10/1/96 to 8/9/97...........  Secretarial Support....................................  $16,698
Sharon Phillips (FNS)............  USDA/FSIS................................  4/21/97 to 1/17/98..........  Secretarial Support....................................  $21,667
Ismael Tercero (FNS).............  DHHS.....................................  10/1/96 to 10/13/97.........  Tribal Health Programs.................................  $40,111
C. Baker (FSIS)..................  DA: Policy Analysis & Coordination Cen-    2/978/97....................  Honor Awards Ceremony..................................  Agreement developed
                                    ter.
D. Barnes (FSIS).................  Office of the Secretary..................  11/954/97...................  Clerical Support.......................................  Unsure if agreement
                                                                                                                                                                      developed Resigned
M. Eldadoky (FSIS)...............  FAS......................................  3/965/31/98.................  Food technology support................................  Detail benefits FSIS
F. Gwozdz (FSIS).................  ARS......................................  1/975/98....................  Staff Assistance.......................................  Detail benefits FSIS
A. Kirk (FSIS)...................  DA: Policy Analysis & Coordination Cen-    2/968/97....................  Clerical Support.......................................  Detail benefits FSIS-
                                    ter.                                                                                                                              Resigned
M. Penner (FSIS).................  NRCS.....................................  12/962/97...................  Office of Civil Rights Work Group......................  Detail benefits FSIS
T. Powell (FSIS).................  OP.......................................  5/12/979/30/97..............  Clerical Support.......................................  Agreement developed
Dawn Frobish (ARS)...............  USDA-OIRM................................  8/961/97....................  Provide fiscal and accounting support..................  $42,185
Robert Harmon (ARS)..............  FSIS.....................................  7/96--Present...............  Training and to provide support to Microcomputer         $25,613
                                                                                                             Support Section.
Eliot Herman (ARS)...............  National Science Foundation..............  10/965/97...................  Cell Biology & Molecular Biology Program Manager to      $64,560
                                                                                                             gain skills in competitive grant process.
Al Kemezys (ARS).................  MAPPS....................................  8/9612/97...................  Provide support for MAPPS..............................  $75,222
Adrienne Labega (ARS)............  Metro Area Reemployment Center...........  3/97--7/97..................  Nonreimbursable--medical accommodation.................  ...........................
Carl Momberger (ARS).............  MAPPS....................................  11/9610/98..................  Provide technical expertise on MAPPS...................  $96,033
Michelle Snowden (ARS)...........  Purchase Card Implementation Team........  4/963/97....................  Response to an EEO settlement agreement................  $62,369
Charlotte Sorrention (ARS).......  Office of the Secretary..................  7/97--Present...............  Provide administrative support.........................  Reimbursement being
                                                                                                                                                                      requested
James Spurling (ARS).............  Under Secretary for Research, Education,   8/97--Present...............  Mission Support........................................  ...........................
                                    and Economics.
Linda Wilson (ARS)...............  MAPPS....................................  Fiscal year 1997............  Provide support for MAPPS..............................  ...........................
Tammara Wright (ARS).............  USDAOffice of the Secretary, Civil Rights  Fiscal year 1997............  Civil Rights Task Force................................  $21,938
                                    Task Force.
Josephine King (CSREES)..........  Office of the Secretary..................  10/969/97...................  Secretarial Assistance.................................  fiscal year 1997 $38,352
                                                                                                                                                                      fiscal year 1998 $2,694
John Dunmore (ERS)...............  FAS......................................  9/962/97....................  Technical Assistance Turkey............................  $39,860
Lowell Dyson (ERS)...............  ARS/NAL..................................  2/97--8/97..................  File Automation........................................  ...........................
Ann Effland (ERS)................  USDA Civil Rights Task Force.............  12/962/97...................  Civil Rights Task Force................................  ...........................
Audrae Erickson (ERS)............  USTR Office of Agricultural Affairs        3 months....................  Agricultural Trade.....................................  ...........................
                                    (White House).
Paul Flaim (ERS).................  President's Council on Sustainable         4 months....................  White House Committee on Sustainable Development.......  ...........................
                                    Development (White House).
Keith Fuglie (ERS)...............  Council of Economic Advisors White         3 months....................  Senior Economist for Agriculture and Natural Resources.  ...........................
                                    House).
George Gardner (ERS).............  USDA/FAS/ICD.............................  1 year......................  To work under the Africa RSSA projet...................  $84,575
Carl Mabbs-Zeno (ERS)............  USDA/FAS/ICD.............................  1 year......................  To work under the African RSSA Project.................  $119,921
Sara Mazie (ERS).................  USDA/REE/OSEC............................  10/1/96 Present.............  Mission Support/Budget Coordination....................  ...........................
Sharon Sheffield (ERS)...........  USDA/FAS.................................  5 months....................  To provide research and analysis of trade and            $40,375
                                                                                                             agricultural policy developments in the countries of
                                                                                                             the NiS/Baltic region, pertaining to their accession
                                                                                                             to the WTO.
Teri Wray (ERS)..................  USDA/PACC/MAP............................  6 months....................  To serve as Customer Service Liaison, Executive Order    $26,347
                                                                                                             on Customer Standards for MAP.
Sylvia Magbanua (NASS)...........  Office of Civil Rights...................  137 days....................  Civil Rights training program..........................  ...........................
Linda Becker (APHIS).............  FSIS.....................................  4/97--7/97..................  Assist with Merit Promotion............................  $11,409
Phuong Callaway (APHIS)..........  BAD......................................  7/29/97 to 10/29/97.........  Learning Assignment....................................  $11,000
Joyce Key (APHIS)................  ASA-CRAT.................................  4/14/97-6/6/97..............  Complaints Backlog.....................................  ...........................
Craig Lambert (APHIS)............  ASA-CRAT.................................  4/1/97 to 7/31/97...........  Complaints Backlog.....................................  ...........................
Kevin McGrath (APHIS)............  ASA-CRAT.................................  4/14/97 to 5/30/97..........  Complaints Backlog.....................................  ...........................
Doris McLaughlin (APHIS).........  ASA-CRAT.................................  7/1/97 to 8/31/97...........  Complaints Backlog.....................................  ...........................
Linda Moore(APHIS)...............  ASA-CRAT.................................  6/97--7/97..................  Environmental Justice/Native American Programs.........  ...........................
Ed Psaltis (APHIS)...............  ASA-CRAT.................................  4/7/97--8/1/97..............  Complaints Backlog.....................................  ...........................
Mary Royster (APHIS).............  OHRM.....................................  9/1/97 to 10/10/97..........  Assist with USDA Ethics Program........................  ...........................
Christopher Sikes (APHIS)........  ASA-CRAT.................................  4/7/978/1/97................  Complaints Backlog.....................................  ...........................
Joe Taylor (APHIS)...............  OPPM.....................................  2/97 to 9/98................  VISA card implementation...............................  ...........................
Rosemary Witcoff (APHIS).........  ASA-CRAT.................................  9/1/97 to 10/10/97..........  Complaints Backlog.....................................  ...........................
Clerance Abrom (GIPSA)...........  APHIS....................................  92 days.....................  APHIS Medfly...........................................  $5,796
Mary Carmouche (GIPSA)...........  APHIS....................................  95 days.....................  APHIS Medfly...........................................  $9,423
Michael Caughlin (GIPSA).........  FAS......................................  10/1/96 to 9/30/97..........  Agribusiness Advisor...................................  $127,000
Stuart Conser(GIPSA).............  APHIS....................................  90 days.....................  APHIS Medfly...........................................  $9,385
John Cox (GIPSA).................  APHIS....................................  115 days....................  APHIS Medfly...........................................  $6,183
William Digdo (GIPSA)............  APHIS....................................  86 days.....................  APHIS Medfly...........................................  $20,621
Robert Fuller (GIPSA)............  APHIS....................................  70 days.....................  APHIS Medfly...........................................  $7,438
Michael Haley (GIPSA)............  APHIS....................................  116 days....................  APHIS Medfly...........................................  $28,518
Ray Hollis (GIPSA)...............  APHIS....................................  47 days.....................  APHIS Medfly...........................................  $8,820
David Johnson (GIPSA)............  APHIS....................................  45 days.....................  APHIS Medfly...........................................  $7,817
Roy Johnson (GIPSA)..............  APHIS....................................  99 days.....................  APHIS Medfly...........................................  still on detail
Jeff LaHaie (GIPSA)..............  APHIS....................................  109 days....................  APHIS Medfly...........................................  $14,117
James Ledoux (GIPSA).............  APHIS....................................  103 days....................  APHIS Medfly...........................................  $14,679
Phillip Meachem (GIPSA)..........  APHIS....................................  63 days.....................  APHIS Medfly...........................................  $7,739
William Napoleon (GIPSA).........  APHIS....................................  95 days.....................  APHIS Medfly...........................................  $17,513
Bradley O'Neal (GIPSA)...........  APHIS....................................  99 days.....................  APHIS Medfly...........................................  $19,294
Wanda Pitiman (GIPSA)............  APHIS....................................  88 days.....................  APHIS Medfly...........................................  $9,485
Steve Reams (GIPSA)..............  APHIS....................................  116 days....................  APHIS Medfly...........................................  still on detail
Mark Reimer (GIPSA)..............  APHIS....................................  88 days.....................  APHIS Medfly...........................................  $10,329
 Linda Remondet (GIPSA)..........  APHIS....................................  63 days.....................  APHIS Medfly...........................................  $7,537
Larry Rice (GIPSA)...............  APHIS....................................  91 days.....................  APHIS Medfly...........................................  $14,835
Rayfield Riley (GIPSA)...........  APHIS....................................  63 days.....................  APHIS Medfly...........................................  $13,329
Robert Simpson (GIPSA)...........  APHIS....................................  116 days....................  APHIS Medfly...........................................  $15,908
Howard Suter (GIPSA)               APHIS....................................  92 days.....................  APHIS Medfly...........................................  $10,722
Gregory Tomas (GIPSA)............  APHIS....................................  54 days.....................  APHIS Medfly...........................................  $14,096
Vince Volpe (GIPSA)..............  APHIS....................................  84 days.....................  APHIS Medfly...........................................  $15,747
Dan White (GIPSA)................  APHIS....................................  116 days....................  APHIS Medfly...........................................  $17,041
James Winters (GIPSA)............  APHIS....................................  84 days.....................  APHIS Medfly...........................................  $12,764
George Wright (GIPSA)............  APHIS....................................  103 days....................  APHIS Medfly...........................................  $6,574
Marci Hilt (OC)..................  DA.......................................  7 months....................  Civil Rights Action Team (CRAT)........................  $50,337
Albert Jaeger (OC)...............  DA.......................................  7 months....................  G-7 Conference.........................................  $66,058
Dale Alling (OCIO)                 RHS......................................  180 days....................  Program Analysis.......................................  $30,000
Franklin Johnson (OCIO)..........  MAP......................................  1 year......................  TOBI Project...........................................  ...........................
Chris Arrington (OCFO)...........  ASA......................................  6 months....................  Modernization of Admin. Processes project..............  $19,000
Gary Barber (OCFO)...............  ASA......................................  6 months....................  Civil Rights Action Team...............................  ...........................
Martha Joseph (OGC)..............  NRCS.....................................  10/1/96 to 3/31/97..........  Assist with Wetlands Reserve Program...................  $23,362
Jeff Knishkowy (OGC).............  Office of Acting Associate, Assistant      1/13/97 to 1/31/98..........  Provide assistance to the Civil Rights Action Team to    ...........................
                                    Secretary for Administration.                                            include implementation of recommendations.
Vincent Vukelich (OGC)...........  GSA,OGPA.................................  5/5/97 to 9/4/97............  Assisting in developing governmentwide guidance          $22,184
                                                                                                             regarding implementation of policies in statutes,
                                                                                                             Executive Orders and regs.
Joyce Fleishman (OIG)............  Department of Transportation Office of     10/1/96--4/11/97............  To serve as Principal Deputy Inspector General for       $79,864
                                    the Inspector General.                                                   Department of Transportation.
Robert Franco (DA)...............  OPM......................................  2/17/97 to NTE 2 yrs........  Develop SES Recruitment Strategies.....................  $116,495
J. Phelps (DA)...................  OCFO.....................................  4 months....................  Financial Info. Systems Vision project (FISVIS)........  $20,600
Pam Folson (NRCS)................  USDA/DAMS................................  6/29/97--9/3/98.............  Provides support to the Office of the Senior Policy      $37,417
                                                                                                             Advisor for Service Implementation and to serve on
                                                                                                             Team I of the Admin. Convergence.
Lois Loser (NRCS)................  USDA/NSD.................................  9/29/97 6/20/98.............  Provides technical support and is Acting Branch Chief..  $68,032
Robert Reaves (NRCS).............  USDA/Department Administrative Management  6/22/97 3/1/98..............  Provide leadership and direction to staff, assign work,  $43,427
                                    Service.                                                                 set goals, participates in Departmentwide and
                                                                                                             Governmentwide multi-organization project.
John Sutton (NRCS)...............  FAS/ICD/DRD..............................  8/21/97 8/31/99.............  Detailed to Acting Chief NTE 2 years...................  $95,529
C. Bailey (FS)...................  Office of the Secretary..................  3/27/97 to 9/30/97..........  Civil Rights Action team...............................  ...........................
C. Brannon (FS)..................  Office of the Secretary..................  4/1/97 to 6/30/97...........  Civil Rights Action Team...............................  ...........................
A. Brown (FS)....................  Office of the Chief Financial Officer....  10/1/96 to 9/30/97..........  FS Liaison.............................................  $69,000
J. Dudley (FS)...................  Modernization of Administrative Pro-       10/1/96 to 9/30/97..........  FS Liaison.............................................  $95,266
                                    cesses.
M. Fletcher (FS).................  Office of the Secretary..................  4/1/97 to 6/6/97............  Civil Rights Action Team...............................  ...........................
C. Franz (FS)....................  Modernization of Administrative Pro-       10/1/96 to 9/30/97..........  FS Liaison.............................................  $86,000 est.
                                    cesses.
J. Frey (FS).....................  Office of the Secretary..................  7/1/97 to 8/8/97............  Civil Rights Action Team...............................  ...........................
 D. Gentry (FS)..................  Office of the Secretary..................  8/4/97 to 9/30/97...........  Civil Rights Action Team...............................  ...........................
L. Goldman (FS)..................  Office of the Secretary..................  4/1/97 to 6/30/97...........  Civil Rights Action Team...............................  ...........................
R. Grand (FS)....................  Natural Resources and Environment........  3/16/97 to 8/8/97...........  FS Laison..............................................  ...........................
S. Hague (FS)....................  Natural Resources and Environment........  2/2/97 to 9/30/97...........  FS Laison..............................................  ...........................
M. Hamilton (FS).................  Office of the Secretary..................  7/1/97 to 9/30/97...........  Civil Rights Action Team...............................  ...........................
T. Harwood (FS)..................  Hazardous Waste Management...............  1/5/97 to 9/30/97...........  FS Liaison.............................................  $81,734
F. Johnson (FS)..................  Office of Information Resource Management  10/1/96 to 11/24/96.........  Computer Specialist....................................  ...........................
J. King (FS).....................  Office of the Chief Financial Officer....  10/1/96 to 9/30/97..........  FS Liaison.............................................  $86,000
S. McCourt (FS)..................  Natural Resources and Environment........  10/1/96 to 3/14/97..........  Communications Liaison.................................  ...........................
B. McDonald (FS).................  Office of the Secretary..................  6/1/97 to 8/31/97...........  Civil Rights Action Team...............................  ...........................
S. Medlyn (FS)...................  Publice Affairs Specialist...............  10/1/96 to 12/7/96..........  Office of Communication................................  ...........................
J. Morris (FS)...................  Office of the Secretary..................  4/1/97 to 7/19/97...........  Civil Rights Action Team...............................  ...........................
Z. Okrak (FS)....................  Office of the Chief Financial Officer....  10/1/96 to 9/30/97..........  FS Liaison.............................................  $72,000
B. Preston (FS)..................  Natural Resources and Environment........  10/1/96 to 9/30/96..........  FS Liaison.............................................  ...........................
C Pytel (FS).....................  Assistant Secretary (ADM)................  3/16/97 to 9/30/97..........  Acting Deputy Assistant, Secretary for Administration..  $70,563
G. Renteria (FS).................  Office of the Secretary..................  6/2/97 to 8/1/97............  Civil Rights Action Team...............................  ...........................
V. Ross (FS).....................  Office of the Secretary..................  3/27/97 to 9/30/97..........  Civil Rights Action Team...............................  ...........................
S. Segovia (FS)..................  Office of the Secretary..................  7/1/97 to 9/30/97...........  Civil Rights Action Team...............................  ...........................
G. Sundstrom (FS)................  Hazardous Waste Management...............  10/1/96 to 9/30/97..........  FS Liaison.............................................  $83,544
T. Sherwood (FS).................  Office of the Chief Financial Officer....  10/1/96 to 9/30/97..........  FS Liaison.............................................  $56,000
F. Shon (FS).....................  Office of the Secretary..................  3/27/97 to 6/27/97..........  Civil Rights Action Team...............................  ...........................
P. St. Peter (FS)................  Office of the Secretary..................  7/1/97 to 11/21/97..........  Civil Rights Action Team...............................  ...........................
D. Stennis (FS)..................  Office of the Secretary..................  4/1/97 to 7/19/97...........  Civil Rights Action Team...............................  ...........................
L. Turner (FS)...................  Natural Resources and Environment........  10/1/96 to 7/17/97..........  Support................................................  $15,000
B. Velde (FS)....................  Hazardous Waste Management...............   9/30/97....................  FS Liaison.............................................  $93,909
K. Waldvogel (FS)................  Hazardous Waste Management...............  10/1/96 to 9/30/97..........  FS Liaison.............................................  $79,239
M. Warren (FS)...................  Natural Resources and Environment........  10/1/96 to 11/8/96..........  Support................................................  $4,127
S. Yaddof (FS)...................  Coop. State Research, Educ. and Ext.       5/1/97 to 9/30/97...........  Support................................................  $31,000
                                    Srvc..
J. Zeller (FS)...................  Office of the Secretary..................  7/7/97 to 8/23/97...........  Civil RightsAction Team................................  ...........................
Reginald Pasteur (AMS)...........  ASA-CRAT.................................  3/974/97....................  Complaints Backlog.....................................  ...........................
Charles Rush (AMS)...............  FAS......................................  6/30/97 to 7/29/97..........  Career Enhancement opportunity.........................  ...........................
Judy Hawkins (GIPSA).............  APHIS....................................  29 days.....................  APHIS Medfly...........................................  $2,929
Kenny Layne (GIPSA)..............  APHIS....................................  28 days.....................  APHIS Medfly...........................................  $2,827
Lynn Luster (GIPSA)..............  APHIS....................................  28 days.....................  APHIS Medfly...........................................  $3,078
Robert Starr (GIPSA).............  APHIS....................................  30 days.....................  APHIS Medfly...........................................  $4,263
Lauretta Miles (OIG).............  USDA/Office of Small and Disadvantaged     10/14/97 11/14/97...........  To provide 30-day detail assignment to perform clerical  ...........................
                                    Business Utilization.                                                    and administrative duties.
Ghulan Sambal (RHS)..............  Office of the Secretary, Assistant         30 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Cherry Smith (RHS)...............  Office of the Secretary, Assistant         21 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Vermell Wheeler (RHS)............  Office of the Secretary, Assistant         30 days.....................  Civil Rights Implementation Team (CRIT)................  ...........................
                                    Secretary for Administration.
Jada Johnson (FNS)...............  OSEC.....................................  1/21/97--2/21/97............  Secretarial Support....................................  ...........................
G. Crawley (FS)..................  Office of the Secretary..................  6/1/97 to 6/30/97...........  Civil Rights Action Team...............................  ...........................
J. Comanor (FS)..................  Natural Resources Conservation Services..  9/1/97 to 9/30/97...........  Support................................................  ...........................
G. Dyer (FS).....................  Office of the Secretary..................  6/1/97 to 6/3/97............  Civil Rights Action Team...............................  ...........................
S. Dykes (FS)....................  Office of the Secretary..................  4/28/97 to 5/25/97..........  Civil Rights Action Team...............................  ...........................
G. Edmondson (FS)................  Assistant Secretary, ADM.................  10/1/96 to 12/26/96.........  Support................................................  ...........................
J. Gavin (FS)....................  Office of the Chief Information Office...  9/29/97 to 9/30/97..........  Support................................................  ...........................
N. Hall (FS).....................  Office of the Secretary..................  3/24/97 to 4/18/97..........  Civil Rights Action Team...............................  ...........................
S. Hooper (FS)...................  Office of the Secretary..................  3/27/97 to 3/31/97..........  Civil Rights Action Team...............................  ...........................
L. Lewandowski (FS)..............  Policy Analysis and Coordination Center..  10/1/96 to 10/31/96.........  Purchase Card Automation Project.......................  ...........................
L. Lewandowski (FS)..............  Policy Analysis and Coordination Center..  3/3/97 to 3/31/97...........  Purchase Card Automation Project.......................  ...........................
L. Peressini (FS)................  Office of the Secretary..................  6/1/97 to 6/30/97...........  Civil Rights Action Team...............................  ...........................
C. Reynolds (FS).................  Office of the Secretary..................  5/1/97 to 5/30/97...........  Civil Rights Action Team...............................  ...........................
S. Risbrudt (FS).................  Office of the Secretary..................  10/1/96 to 10/18/96.........  Support................................................  ...........................
J. Synder (FS)...................  Natural Resources and Environment........  10/1/96 to 10/31/96.........  Support................................................  ...........................
J. Synder (FS)...................  Office of the Deputy Secretary...........  11/1/96 to 11/12/96.........  Support................................................  ...........................
M. Warren (FS)...................  Natural Resources and Environment........  9/29/97 to 9/30/97..........  Support................................................  ...........................
J. Worley (FS)...................  Office of Civil Rights...................  10/1/96 to 10/31/96.........  Support................................................  ...........................
J. Zeller (FS)...................  Office of the Secretary..................  9/15/97 to 9/30/97..........  Civil Rights Action Team...............................  ...........................
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Provide a list of advisory committees, panels, 
commissions and task forces funded in each of fiscal years 1998, 1999 
(planned) and 2000 (planned), by agency, and the amount of funds 
allocated for each.
    Answer. I am providing a table that lists planned activities funded 
in fiscal year 1998 and fiscal year 1999, and proposed activities as 
well as assumed funding for fiscal year 2000.
    Question. Please provide a list of the advisory committees, panels, 
commissions and task forces proposed to be funded for fiscal year 2000, 
by agency, and the amount of funds assumed for each.
    Answer: Information on the fiscal year 2000 costs of these 
committees was provided in response to question 61.
    [The information follows:]

                                            USDA ADVISORY COMMITTEES
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year     Fiscal Year
                         Committee Title                               1998            1999            2000
----------------------------------------------------------------------------------------------------------------
              FOOD, NUTRITION AND CONSUMER SERVICES
 
National Advisory Council on Maternal, Infant and Fetal                  $30,000         $50,000         $50,000
 Nutrition......................................................
 
                           FOOD SAFETY
 
National Advisory Committee on Meat and Poultry Inspection......          49,318          60,000          64,000
National Advisory Committee on Microbiological Criteria for               36,000          75,000          40,000
 Foods..........................................................
                                                                 -----------------------------------------------
      Total, Food Safety........................................          85,318         135,000         104,000
                                                                 ===============================================
 
                RESEARCH, EDUCATION AND ECONOMICS
 
Forestry Research Advisory Council..............................          21,862          25,100          26,100
National Agricultural Research, Extension, Education, and                252,430             \1\             \1\
 Economics Advisory Board.......................................
Strategic Planning Task Force on Research Facilities............         148,367          64,050  ..............
USDA/Hispanic Association of Colleges and Universities..........          11,750          18,900          19,500
USDA/American Indian Higher Education Consortium................  ..............          57,800          59,000
                                                                 -----------------------------------------------
    Subtotal, CSREES............................................         434,409         165,850         104,600
                                                                 ===============================================
National Genetic Resources Advisory Council.....................          14,950          16,000          16,500
Dietary Guidelines Advisory Committee...........................          10,206         123,600         123,600
                                                                 -----------------------------------------------
    Subtotal, ARS...............................................          25,156         139,600         140,100
                                                                 ===============================================
Census Advisory Committee on Agriculture Statistics.............          34,647          25,000          26,000
                                                                 ===============================================
    Total, REE..................................................         494,212         330,450         270,700
 
                MARKETING AND REGULATORY PROGRAMS
 
Advisory Committee on Foreign Animal and Poultry Diseases.......          17,457          21,000          18,900
General Conference Committee of the National Poultry Improvement  ..............          11,300           9,930
 Plan...........................................................
National Wildlife Services Advisory Committee (formerly the               17,490         118,100          18,100
 National Animal Damage Control Advisory Committee).............
                                                                 -----------------------------------------------
    Subtotal, APHIS.............................................          34,947          50,400          46,930
                                                                 ===============================================
National Organic Standards Board................................          27,781          50,000          50,000
Federal Grain Inspection Advisory Committee.....................          25,113          30,000          31,000
                                                                 ===============================================
     Total, MRP.................................................          87,841         130,400         127,930
                                                                 ===============================================
 
             FARM AND FOREIGN AGRICULTURAL SERVICES
 
Agricultural Policy Advisory Committee for Trade................          14,120          14,120          14,120
Ag. Tech. Adv. Comm. For Trade in:
    --Animal & Animal Products..................................          14,110          14,110          14,110
    --Fruits and Vegetables.....................................          14,110          14,110          14,110
    --Grains, Feed, and Oilseeds................................          14,110          14,110          14,110
Sweetners and Sweetner Products.................................          14,110          14,110          14,110
Tobacco, Cotton, and Peanuts....................................          14,110          14,110          14,110
Emerging Markets Advisory Committee.............................          14,000          14,000          32,700
Edward R. Madigan Agricultural Export Excellence Award Board....  ..............          14,110          15,000
                                                                 -----------------------------------------------
    Subtotal, FAS...............................................          98,670         112,780         132,370
                                                                 ===============================================
National Drought Policy Commission..............................  ..............         443,000         157,000
Advisory Committee on Beginning Farmers and Ranch-  ers.........  ..............          26,640          28,000
National Drought Policy Commission..............................  ..............         443,000         157,000
Advisory Committee on Risk Management...........................  ..............          60,000          60,000
                                                                 -----------------------------------------------
      Subtotal, RMA.............................................  ..............         503,000         217,000
                                                                 ===============================================
    Total, FFAS.................................................          98,670         642,420         377,370
                                                                 ===============================================
 
                NATURAL RESOURCES AND ENVIRONMENT
 
Task Force on Agricultural Air Quality Research.................          42,000          50,000          50,000
National Commission on Small Farms..............................          58,400          36,000          25,000
USDA/1890 Task Force............................................           4,000          15,000          15,000
                                                                 -----------------------------------------------
    Total, NRE..................................................         104,400         101,000          90,000
                                                                 ===============================================
 
                  OFFICE OF THE CHIEF ECONOMIST
 
Commission on 21st Century Production Agriculture...............          17,205         275,000         275,000
 
                   DEPARTMENTAL ADMINISTRATION
 
Secretary's Small Business Advisory Committee...................  ..............          30,000          25,000
                                                                 -----------------------------------------------
      Subtotal, Advisory Committees.............................         917,646       1,694,270       1,320,000
Contingencies/Reserve...........................................          82,354         105,730         480,000
                                                                 ===============================================
    TOTAL, ADVISORY COMMITTEES..................................       1,000,000       1,800,000       1,800,000
----------------------------------------------------------------------------------------------------------------
\1\ The Agriculture Research, Extension, and Education Act of 1998, Public Law 105-185, exempts this committee
  from the USDA Advisory Committee limitation.


                               USDA ADVISORY COMMITTEES FUNDED FROM FOREST SERVICE
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year     Fiscal Year
                         Committee Title                               1998            1999            2000
----------------------------------------------------------------------------------------------------------------
Blue Mountains..................................................         $11,750         $11,750         ( \1\ )
Allegheny National Forest:
    --Northern..................................................             250             250         ( \1\ )
    Southern....................................................             250             250         ( \1\ )
    California Spotted Owl Federal Advisory Board...............          27,333  ..............         ( \1\ )
Committee of Scientists.........................................         297,757          14,400         ( \1\ )
Committee of State Foresters....................................          13,550  ..............         ( \1\ )
Intergovernmental Advisory Committee to the Regional Interagency         158,265         158,265         ( \1\ )
 Executive Committee............................................
Lake Tahoe Basin Advisory Committee.............................  ..............          20,000         ( \1\ )
National Urban and Community Advisory Committee.................         197,691         131,000         ( \1\ )
Provincial Interagency Executive Committee Advisory Committee...         713,299         749,825         ( \1\ )
 
Wildcat River Advisory Committees:..............................
    Brule River Study Committee.................................  ..............  ..............         ( \1\ )
    Carp River Study Committee..................................  ..............  ..............         ( \1\ )
    Little Mainstee River Study Committee.......................  ..............  ..............         ( \1\ )
    Ontonagon River Study Committee.............................  ..............  ..............         ( \1\ )
    Paint River Study Committee.................................  ..............  ..............         ( \1\ )
    Preque Isle River Study Committee...........................  ..............  ..............         ( \1\ )
    Tahquamenon River Study Committee...........................  ..............  ..............         ( \1\ )
    Sturgeon River (Ottawa National Forest) Study Committee.....  ..............  ..............         ( \1\ )
    Sturgeon River (Hiawatha National Forest) Study Committee...  ..............  ..............         ( \1\ )
    Whitefish River Study Committee.............................  ..............  ..............         ( \1\ )
    White River Study Committee.................................  ..............  ..............         ( \1\ )
                                                                 -----------------------------------------------
    TOTAL FOREST SERVICE........................................       1,420,145       1,085,740         ( \1\ )
----------------------------------------------------------------------------------------------------------------
\1\ Data not currently available. USDA ADVISORY COMMITTEES FUNDED FROM USER FEES


                                 USDA ADVISORY COMMITTEES FUNDED FROM USER FEES
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year     Fiscal Year
                         Committee Title                               1998            1999            2000
----------------------------------------------------------------------------------------------------------------
Advisory Committee on Universal Cotton Standards................         $34,500         $11,000         $11,000
Burley Tobacco Advisory Committee...............................          30,543          41,712          41,712
Flue-Cured Tobacco Advisory Committee...........................          27,583          36,453          36,453
National Advisory Committee for Tobacco Inspection Services.....          37,531          46,341          46,341
Plant Variety Protection Advisory Board.........................  ..............          14,800          14,800
                                                                 -----------------------------------------------
    TOTAL, USER FEES............................................         130,157         150,306         150,306
----------------------------------------------------------------------------------------------------------------

                                 ______
                                 
                 Questions Submitted by Senator Gorton
                          disaster assistance
    Question. Last year, Congress provided nearly $6 billion in 
agriculture relief in the form of payments to farmers due to disaster 
and poor foreign market conditions. What, in the President's budget, 
assures us that another disaster package won't have to be established 
again this year?
    Answer. Last year's assistance package is helping to maintain farm 
income and limiting financial hardship for many producers. At least in 
the short term, prices are too low for farmers to make a decent living 
without additional government support beyond what is provided for in 
the Farm Bill. Unfortunately, exports and prices will probably remain 
at low levels in 1999, causing increased farm financial stress, and 
family farmers may need additional financial support. More money will 
be needed in 1999 to provide direct and guaranteed loans. Funds are 
nearly exhausted for some key credit programs, and we will be 
submitting a request for supplemental funds soon.
    With regard to the budget for fiscal year 2000, our request was 
formulated in the context of continued constraints on Federal spending 
under the Balanced Budget Act of 1997, and thus reflects some difficult 
choices. We recognize recovery will occur at a very gradual pace over 
the next several years, and we are committed to making the utmost use 
of available authorities and program resources to help producers 
through these tough times. And we are committed to working to 
strengthen the farm safety net to help farmers prosper in good times 
and bad without the need for repeated ad hoc assistance.
    Question. What in this budget provides what you've referenced as a 
`safety net' for farmers?
    Answer. While improvements to the crop insurance program are key to 
strengthening the safety net, the budget provides for a broad range of 
programs which help farmers manage risk. We are requesting significant 
levels of funding for commodity, credit, insurance, and export 
programs. Each of these programs, as well as many programs in the other 
mission areas of the Department, contributes significantly to the 
safety net for farmers and ranchers.
                                exports
    Question. Farmers in the State of Washington rely heavily on export 
for survival, and in the past year, most national farm organizations 
have made it quite clear that in order to increase the prices paid for 
U.S. commodities, additional markets and more avenues for exports need 
to be available. Why then, has the Administration cut export programs?
    Answer. During the past year, USDA has responded vigorously and 
creatively to developments in world financial and commodity markets. As 
a result, the level of programming for many of our export activities 
has increased substantially. For example, in response to the financial 
crisis in Asia, USDA expanded the level of CCC export credit guarantees 
made available. As a result, sales registrations under the guarantee 
programs were 40 percent higher during 1998 compared to the previous 
year. The expanded level of guarantee programming is expected to 
continue in both 1999 and 2000.
    This fiscal year, USDA has greatly expanded the level of foreign 
food assistance programming, and the overall level of U.S. foreign food 
assistance will total as much as 10 million metric tons this year. This 
increase results from the President's Food Aid Initiative under which 5 
million metric tons of wheat and wheat products will be made available 
to needy countries. It also reflects a major package of food assistance 
for Russia which will total more than 3.1 million metric tons, 
including 1.5 million metric tons of wheat to be made available under 
the President's Food Aid Initiative.
    These actions demonstrate that the Department is responding to 
changing conditions in overseas markets and is applying resources as 
needed to maintain access to those markets. Although the budget shows a 
reduction in the overall program level for USDA international 
activities in 2000, this is primarily due to the sizeable increase in 
food aid programming during 1999. For 2000, the budget assumes food aid 
programming will return to a more traditional level. On the other hand, 
the 2000 budget provides a total program level of $6.5 billion for USDA 
international activities; this is considerably higher than the actual 
level for 1998 of $5.7 billion. Thus, the program level for 2000 is 
approximately $800 million above the level of just last year.
    Question. What are USDA's plans for increasing foreign markets for 
U.S. commodities?
    Answer. USDA is committed to moving forward with greater reform in 
world agricultural trading practices in the next round of world trade 
talks which is set to begin later this year. Our goals for the upcoming 
WTO negotiations include: elimination of export subsidies; 
substantially cutting, and where possible eliminating, tariffs on farm 
products; tightening rules on domestic subsidies; reforming state 
trading enterprises, and tightening rules on technical barriers that 
unjustifiably restrict trade. In addition, we will continue to work to 
resolve the contentious bilateral trade issues that hinder our exports, 
such as the EU ban on U.S. beef, restrictive Canadian import policies 
for livestock and wheat, and unfair Chinese restrictions on U.S. wheat.
    In addition to the export credit guarantee and foreign food 
assistance activities mentioned above, USDA continues to carry out 
other important export promotion and market development programs, 
including the Foreign Market Development Cooperator Program and the 
Market Access Program. For 2000, the budget proposes the implementation 
of two new market development activities. The first is a program of 
Reverse Trade Missions which will bring buying missions of foreign 
importers, retailers, and trade officials to the United States to 
orient them on the quality and diversity of U.S. agricultural products. 
The second is a new Quality Samples Program under which samples of U.S. 
agricultural products will be provided to foreign importers to promote 
a better understanding and appreciation of their high quality.
                       regional research programs
    Question. For the past three years, all regional research programs 
have been eliminated in the President's budget. Explanations in the 
past have noted that these programs are zeroed out in order to focus on 
`national research programs of significance'. What research programs 
are considered `national research programs of significance'?
    Answer. The Fiscal Year 2000 Budget Request for the Cooperative 
State Research, Education, and Extension Service (CSREES) reflects the 
Administration's commitment to improving the science base for 
agriculture through the competitive grants programs of the National 
Research Initiative and targets high priority activities such as small 
farms, water quality, food safety, sustainable agriculture, global 
change, and improved pest control programs. In keeping with the 
Administration's goal to focus on these high priority research 
programs, projects earmarked for specific institutions were proposed 
for elimination. Alternate funding from formula programs, State and 
local governments, and private sources could be use to support aspects 
of this program deemed to be of a high priority at State and/or local 
levels.
                              food safety
    Question. I understand that the Food Safety and Inspection Service 
has announced a plan to test moving their food inspectors out of the 
Federal slaughter and processing plants and moving them into retail 
such as into grocery stores. Grocery stores are already under 
inspection by FDA and the State and local public health departments. 
This doesn't seem very efficient or productive given that other areas 
are in greater need of food safety inspection. For example, I 
understand that there is a greater need for inspection at ports of 
entry instead of in grocery stores. Does the budget for USDA reflect 
FSIS' desire to implement such a program in grocery stores, or does 
USDA intend on focusing on the problems surrounding some imported 
foods?
    Answer. The 2000 budget for the Food Safety and Inspection Service 
(FSIS) includes an increase of $10.8 million to help the FSIS 
inspection workforce make the transition to a new Hazard and Analysis 
and Critical Control Point (HACCP) environment, including the 
conversion of 638 positions to Consumer Safety Officers. In these new 
positions, inspection personnel will be responsible for conducting 
scientific testing and inspections throughout the farm-to-table 
continuum. FSIS intends to redistribute its resources in ways that 
permit FSIS to more efficiently and effectively verify that the 
industry meets its responsibility to produce safe and wholesome 
products. Some personnel will be redeployed to cover critical 
inspection vacancies in very small establishments. If it appears that 
inspection sources should be increased at import re-inspection 
locations, FSIS managers will assign personnel as needed.
                      food quality protection act
    Question. A consistent concern relayed to me by the agriculture 
community in Washington state is the implementation of the Food Quality 
Protection Act and USDA's involvement with EPA. How has USDA been 
working in conjunction with EPA and what are the Department's 
predictions regarding implementation and the potential loss of tools 
necessary for production?
    Answer. We have established a close working relationship with EPA. 
One of the most important procedures that we have established with EPA 
involves the development of Transition Strategies. When final risk 
assessments indicate that a chemical or a use of a chemical must be 
canceled to meet the stringent new FPA standards, USDA will take the 
lead in the development of the Transition strategies. These strategies 
will be developed in partnership with EPA and with broad stakeholder 
involvement. We are doing our best to meet our regulatory obligations 
under FQPA while making sure that we have the pest control tools 
necessary for production.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                            e. coli testing
    Question. FSIS has been testing ground beef for E. coli 0157:H 
since 1996. Out of 26,088 samples, they have found only 25 positive. 
How much is it costing USDA to look for something they only find 0.09 
percent of the time, or less than once in every one-thousand samples 
tested? None of these samples were connected to an outbreak or illness-
so what is the value of this testing?
    Answer. The Food Safety and Inspection Service (FSIS) spends 
approximately $10.4 million per year on testing meat and poultry 
products for 9 potentially deadly pathogens, including E. coli O157:H7, 
Salmonella, Campylobacter, and Listeria. The testing program for E. 
coli O157:H7 began after the tragic outbreak of foodborne illness 
associated with this pathogen in the State of Washington. USDA 
estimates that over 10,000 illnesses per year result from consuming 
foods contaminated with E. coli O157:H7. As the Washington outbreak 
demonstrated, the most susceptible to this pathogen include children, 
the elderly, and the immune compromised. Testing programs like that for 
E. coli O157:H7 assists us in controlling deadly pathogens by 
identifying contaminated product in time to remove it from the market 
before it can cause foodborne illness.
    Question. Most of these 26,000+ samples were collected from grocery 
stores. How can testing at grocery stores for E. coli 0157:H7 or any 
pathogen contribute to the protection of the public's health if the 
consumer has already eaten the food by the time you get test results 
back?
    Answer. The testing program is targeted to detect contamination 
problems at the retail level, because many retail stores further 
process ground beef after receiving it from a federally inspected 
facility. Detection and removal of pathogen-contaminated foods at any 
point of distribution will serve to protect the public from foodborne 
illness. In addition to removing contaminated product from the market, 
knowledge of food contamination problems promotes corrective actions on 
the part of producers, and serves to prevent future foodborne health 
hazards.
    Question. Shouldn't the testing be done before the food reaches the 
stores?
    Answer. Currently, the FSIS collects approximately 60 percent of 
the samples from retail stores and approximately 40 percent of the 
directly from processing plants. Further, FSIS conducts a variety of 
monitoring programs for several foodborne pathogens in ready-to-eat 
products, and all of these monitoring samples are collected at the 
processing plant level prior to distribution at the retail level.
    Question. FSIS has announced a plan to test moving food inspectors 
out of the Federal slaughter and processing plants and moving them into 
retail such as into grocery stores. Grocery stores are already under 
inspection by FDA and the State and local public health departments. 
This doesn't seem efficient or productive given the other areas are in 
greater need of food safety inspection. For example, Senator Collins 
and the Government Accounting Office have identified a real need for 
increased inspection of imported foods at the ports of entry. Why not 
put these inspectors there is a need rather than where you will just be 
duplicating effort?
    Answer. Traditionally, FSIS has assigned the great majority of its 
resources to inspection activities within slaughter and processing 
plants. Consistent with the modernization and farm-to-table 
initiatives, FSIS intends to redistribute its resources in ways that 
permit FSIS to more efficiently and effectively verify that the 
industry meets its responsibility to produce safe and wholesome 
products. If it appears that inspection resources should be increased 
at import re-inspection locations, FSIS managers will assign personnel 
as needed.
    Question. Do you have any data to show that grocery stores need 
more inspection that imported foods?
    Answer. FSIS is developing a plan for redeploying some inspectors 
currently assigned within establishments to monitor, sample, and verify 
the safety and wholesomeness of meat and poultry in the storage, 
transportation, and retail sale stages of the food production chain. 
FSIS has held a number of public meetings to gain input from the public 
on the plan and proposed inspection models. Once the plan is pilot 
tested and evaluated, FSIS will share the results with the public. The 
Agency will not make any changes to inspection procedures until it has 
adequate data, public input and has completed a thorough rulemaking 
process. If it appears that inspection sources should be redeployed 
differently, FSIS managers will assign personnel as appropriate.
    Question. Recently there have been several errors made by FSIS in 
relation to its testing program and recalls. For example, there was a 
recall that may have actually been a mistake since the laboratory in 
Florida could not ``find'' the E. coli 0157:H7 after they said it was 
in the meat: in another case, FSIS issued a press release listing the 
wrong products, telling consumers to return products that were not even 
contaminated to their grocery stores. Most recently, FSIS issued a 
``policy clarification'' that literally backfired--it had the opposite 
effect of making industry abandon E. coli testing programs that were 
designed to protect the consumer. What are your plans for addressing 
these problems?
    Answer. We are working closely with the industry to ensure that the 
implementation of the E. coli O157:H7 testing program is accurate and 
effective in improving the safety of the products we regulate.
                           yellowstone bison
    Question. APHIS has continued to promote a ``low-risk definition'' 
was regards to bison from Yellowstone National Park which migrate into 
Montana. The definition has not been agreed upon by the State of 
Montana due to APHIS's lack of willingness to get the U.S. Animal 
Health Association's (USAHA) concurrence on the definition or to agree 
to financially compensate producers if restrictions are placed on the 
movement of Montana livestock as a result. How does USDA plan to 
address the issue of ``low-risk definition''?
    Answer. In a collaborative effort between the National Park Service 
and APHIS, the low-risk bison definition was developed in the interest 
of minimizing lethal control of bison while obtaining the optimum safe 
balance between maintaining a viable bison herd in the Park and 
protecting Montana cattle from the threat of brucellosis. Since the 
original definition was proposed, additional data has been collected 
from the Yellowstone bison which provides new information about the 
risk of brucellosis in bison. In light of this data, we plan to meet 
with representatives of the National Park Service and the Montana 
Department of Livestock to determine whether the definition of low-risk 
needs amending. If the definition is amended, the revised definition 
will then be presented to USAHA for consideration. APHIS remains 
committed to working cooperatively with the State of Montana and other 
cooperative agencies towards a resolution of the brucellosis problem in 
Yellowstone National Park.
                              brucellosis
    Question. Does APHIS still support the goal of eradicating 
brucellosis nationally and what role do the State veterinarian play in 
this goal?
    Answer. APHIS has a firm continued commitment to eradicating 
brucellosis caused by Brucella abortus  in the United States. In 1997, 
an Emergency Action Plan (EAP) for brucellosis was initiated. According 
to the EAP, all activities involving brucellosis surveillance and 
management of new cases are conducted as an emergency action. Personnel 
and fiscal resources are made available where needed to achieve the 
goal of eradication. The EAP is still in place, and APHIS continues to 
actively pursue elimination of the disease.
    The Brucellosis Eradication Program in the United States has been a 
State-Federal cooperative program, and State Veterinarians have worked 
with APHIS to eradicate brucellosis in their states. State 
veterinarians have the responsibility of protecting the health of 
livestock in their state, and they may take whatever additional steps 
they feel are necessary, beyond those set as minimum standards in the 
Brucellosis Uniform Methods and Rules, to ensure the health of 
livestock in their state.
    Question. We understand Federal officials are considering the 
relocation of disease-exposed bison from Yellowstone National Park to 
the State of South Dakota or the Congressional delegation of South 
Dakota about this proposal?
    Answer. APHIS is not aware of any plans to relocate disease-exposed 
bison from Yellowstone National Park to South Dakota. In addition, 
APHIS would be opposed to any such action, unless the bison had 
completed a quarantine and testing protocol as outlined for the Bison 
Quarantine Facility in the Brucellosis Uniform Methods and Rules, and 
the above named officials had been notified and approved of the legal 
movement of these animals.
                    wildlife transmission of disease
    Question. How does the USDA look to address the issue of wildlife 
transmission of diseases to domestic livestock?
    Answer. APHIS is working cooperatively with State and Federal 
wildlife agencies to investigate, study, and evaluate disease 
conditions in wildlife; to conduct risk analyses to determine the risk 
to domestic species and other wildlife populations; and to conduct 
pathological studies in wildlife populations. Recent examples of 
wildlife disease conditions in which APHIS has been involved include 
tuberculosis in white-tailed deer in Michigan; brucellosis in feral 
swine and the bison of Yellowstone National Park; chronic wasting 
disease in elk; and VVND in cormorants. State wildlife agencies have 
expressed an interest in APHIS providing assistance in disease 
management issues (including disease surveillance and diagnostic 
support) involving wildlife and advice in handling wildlife infected 
with zoonotic diseases.
    Question. Are there currently any discussions between the 
Department of the Interior and USDA to address this issue in the coming 
years, due to the increased amount of land that the Federal Government 
is managing in addition to the increased numbers of wildlife having 
interaction with domestic livestock in these areas?
    Answer. Discussions are ongoing with the Department of Interior 
(DOI) to address wildlife issues. APHIS, the Agricultural Research 
Service (ARS), and DOI are working collaboratively to determine and 
prioritize research needs in the area of wildlife disease management. 
APHIS also works with the DOI's Natural Park Service in the management 
of brucellosis-affected and exposed bison in Yellowstone National Park 
and DOI's Bureau of Land Management (BLM) in the management and capture 
of wild horse on BLM land. APHIS provides veterinary advice for the BLM 
program in which wild horses are captured from 10 states and provided 
for adoption. APHIS will continue to work with DOI on collaborative 
efforts regarding the disease management of wildlife.
               canadian compliance with livestock testing
    Question. A number of international trade disparities exist, among 
them unfair testing requirements on livestock for diseases like 
brucellosis, anaplasmosis, bluetongue, vesicular stomatitis and 
tuberculosis between the U.S. and Canada. What does USDA plan to do 
about Canadian compliance on livestock testing?
    Answer. We appreciate the opportunity to clarify this issue. 
Differences in animal health status between the United States and 
Canada do exist and offer legitimate reasons for requiring testing and/
or certifications. Canada is free of 4 of the diseases including 
brucellosis, anaplasmosis, bluetongue, and tuberculosis, while the 
United States is not free of these diseases. Canada's import 
requirements for these diseases are in accord with the international 
standards, which is the OIE International Animal Health Code. There are 
no requirements for vesicular stomatitis testing for livestock exports 
to Canada.
    The United States continues to work with Canada to eliminate as 
many animal health requirements as possible. In December 1998, the two 
countries reached an agreement that addressed several animal health 
issues. In this agreement, Canada confirmed that 26 states are eligible 
for consideration under the restricted feeder cattle requirements. 
Information on participation in this program was sent to all the 
states. Another significant point in the agreement was Canada's 
commitment to amend their animal health regulations to allow for 
recognition of regions or zones. This will allow for recognition of 
States that are free of certain diseases such as tuberculosis or 
bluetongue. Canada will need to revise their regulations to do this. 
Canada has committed to completing the regulatory process within 2 
years.
                      eu ban on u.s. beef exports
    Question. Another major livestock concern is the non-scientific 
trade barriers the EU has employeed to ban U.S. beef and their non-
compliance with the WTO. What role will the USDA take in encouraging 
the EU to comply with WTO rules. Additionally, if they will not comply 
what will the USDA do to make certain the EU takes the United States 
seriously as a trading partner?
    Answer. The United States has strongly indicated to the EU that we 
expect the EU to comply with the WTO rulings on the Hormones case by 
the May 13 deadline. We have emphasized to the EU the importance of 
this issue to our beef industry as well as to the integrity of the WTO 
SPS Agreement. The European Commission has adopted a ``Communication on 
Options Regarding the WTO Decision on the EU Hormone Ban''. We view 
this paper as a positive move on the part of the Commission, and were 
encouraged to see that one of the options put forward was the removal 
of the ban coupled with a suitable labeling scheme. To that end, 
Ambassador Barshefsky and Secretary Glickman proposed a beef labeling 
system to the EU as a way of resolving this issue. We will work with 
the EU on resolving this issue, and will be prepared to take the 
necessary action if an acceptable resolution is not reached.
                          export restrictions
    Question. Restrictions on the export of agricultural commodities 
should be eliminated except in extreme cases of war or multi-national 
security. Non-tariff trade barriers and those that are not 
scientifically based must be removed in order for the U.S. to compete 
in the world market. What will USDA do to ensure the U.S. remains a 
viable trading partner?
    Answer. The Administration has made clear that commercial exports 
of food and other human necessities should be excluded from future 
unilateral sanctions as a matter of general principle and is in support 
of legislation to accomplish that goal. With regard to lifting current 
sanctions, the Administration is considering a recent request for 
export of agricultural commodities to Iran. Commercial and foreign 
policy considerations are being assessed as the decision-making process 
moves forward. Recently, the Administration took a modest first step to 
lift sanctions on the sale of ``foodstuffs'' to private entities in 
Cuba. USDA will continue to work within the Administration to support 
the lifting of unilateral sanctions on food where this step is 
appropriate.
    USDA, working with the Office of the U.S. Trade Representative 
(USTR), the Department of State and other U.S. governmental agencies, 
actively monitors our trading partners' technical standards to assure 
that they comply with international agreements. Technical issues, such 
as sanitary and phytosanitary (SPS) standards, are discussed in 
bilateral and multilateral fora and are generally resolved at either 
the technical or political level depending on the issue.
    The Department's SPS Technical Working Group meets every week to 
document new issues and to receive updates on outstanding barriers that 
either threaten or are currently impeding U.S. agricultural exports. 
Most of the issues addressed by the group are highly technical and 
require follow-up by subject experts from various regulatory agencies. 
For example, the TWG was actively involved in resolving Egypt's 
proposed mandatory pre-shipment testing and certification program for 
apples that would have slowed U.S. apple exports to this small, but 
growing market. In contrast, high profile and time-sensitive technical 
issues that can have a significant impact on trade, such as Mexico's 
proposed rule on avian influenza, are normally dealt with outside of 
the TWG and are elevated to higher levels within the Department.
                       state trading enterprises
    Question. U.S. producers are concerned that the Canadian Wheat 
Board (CWB) is unfairly subsidizing its farmers and thus presenting 
them with an unfair advantage in the world market. State Trading 
Enterprises undercut competitors without concern for profit or loss and 
thus produces inefficiencies, distorts trade and diminishes prices for 
all producers. What will USDA do to eliminate State Trading 
Enterprises?
    Answer. We are considering several approaches for dealing with 
exporting STEs in the next round of WTO agriculture negotiations, 
including increasing the transparency of STE operations and expanding 
competition by seeking the removal of statutory monopoly export 
authority and statutory monopsony purchasing authority. Additionally, 
as countries agree to open their markets to imports, importing State 
Trading Enterprises have also come under increased scrutiny. While the 
importing STEs in many cases are among our best customers, the ability 
of importing countries to use control over their STEs to restrict 
imports is a serious issue that must also be addressed through the WTO.
                     canadian pesticide advantages
    Question. Sanitary and Phytosanitary Standards have long been a 
point of contention between the United States and Canada. While 
Canadian producers are allowed to use certain chemicals on their 
commodities and market them in the United States, U.S. producers are 
not allowed to even purchase those same chemicals. What action does 
USDA plan to take to ensure American producers have the same advantages 
as Canadian producers?
    Answer. In the December 4, 1998 Record of Understanding between the 
United States and Canada, both sides agreed to meaningful commitments 
to help level the playing field on chemical use. Details on the Action 
Plan for Pesticide Trade Issues will be submitted for the record.
    In addition, USDA has coordinated with FDA and EPA to respond to 
claims by U.S. producers regarding Canadian wheat entering the United 
States with prohibited chemical residues. As a result, FDA and EPA have 
researched the registration and monitoring status of 22 chemicals of 
concern. FDA has agreed to collect 30 samples of Canadian wheat 
entering the United States and evaluate them for residues of all 
chemicals it has the ability to test for. The data, which should be 
available in 2-3 months, will indicate whether additional monitoring of 
Canadian wheat is warranted.
    [The information follows:]
U.S. Canada Record of Understanding Action Plan for Pesticide Trade 
        Issues
    The U.S. Environmental Protection Agency (EPA) and the Canadian 
Pesticide Management Regulatory Agency (PMRA) will work with growers 
and registrants in both countries to accelerate bilateral harmonization 
using the five year North American Initiative developed by the NAFTA 
Technical Working Group on Pesticides as the framework. As a result of 
these efforts, there will be great potential for faster and 
simultaneous access to a wider range of pest control products for both 
major and minor crops in both countries. However, the success of this 
initiative hinges on the full and active participation of growers and 
registrants in both countries.
    EPA and PMRA will continue to cooperate with respect to U.S. 
implementation of the Food Quality Protection Act.
    EPA and PMRA are committed to work together to develop a harmonized 
policy for movement of treated seeds by December 1999.
    EPA and PMRA will investigate mechanisms to improve links with 
state/provincial/territorial officials as a way of providing improved 
information sharing and a heads up mechanism for potential pesticide/
trade issues.
    Canadian canola growers have requested Canadian registrants to 
agree voluntarily to remove canola/rapeseed claims from labels of 
registered canola seed treatments containing lindane by December 31, 
1999. All commercial stocks containing lindane for use on canola and 
lindane treated canola seed would not be used after July 1, 2001. This 
is contingent on registrants requesting voluntary removal. EPA, PMRA, 
growers and registrants will continue to work together to facilitate 
access to replacement products.
    For those specific canola registration reviews undertaken by the 
EPA on an accelerated basis, EPA and the PMRA will share work on 
evaluation of pesticide products to the furthest extent possible.
    EPA and PMRA will request U.S. and Canadian canola associations to 
prioritize pesticide registration needs from a list of pesticides now 
available in either country which are pending approval in the other 
country. The associations, in consultation with pesticide registrants, 
would also be asked to identify alternatives to pesticides such as 
organophosphates (OPs) or others with risk concerns. The resulting list 
will then be a basis for a longer term strategy to assure adequate, 
reduced risk pest control tools for canola growers and will fit with 
current NAFTA efforts to promote a coordinated approach to Integrated 
Pest Management for canola.
    For dry beans (pulses), lentils, and flax (crops grown in rotation 
with canola), EPA and PMRA will request that growers, in consultation 
with pesticide registrants in the United States and Canada, identify 
and prioritize pest control tools and needs for purposes of identifying 
grower priorities for the agencies. EPA and PMRA will jointly explore 
efforts to share work on evaluation of pesticide products.
    On May 6, The U.S. Department of Agriculture (USDA) and Agriculture 
and Agri-Food Canada, in conjunction with EPA and PMRA, will convene a 
high level meeting with Chief Executive Officers of North American 
pesticide companies to encourage companies to take advantage of the 
pesticide joint review process and to encourage industry's role in 
harmonization goals.
    USDA and Agriculture and Agri-Food Canada will jointly conduct a 
study of pesticide price differentials within the United States and 
Canada to be completed within 6 months.
                       country-of-origin labeling
    Question. The USDA stamp on foreign products is a detriment to the 
producers because foreign countries get the benefit of the grade stamp, 
without having to pay for it. America's producers need the protection 
of country of origin labeling to assure that the USDA label really 
means just that--produced in the U.S. It is a detriment to the consumer 
because they deserve to know that they are buying American and that 
they are buying absolutely the safest food supply in the world, which 
is grown by American farmers and ranchers. What does USDA plan to do 
about other countries reaping the benefits of the USDA label?
    Answer. As directed by the Omnibus Consolidated and Emergency 
Supplemental Appropriations Act for Fiscal Year 1999, we are conducting 
a study on the potential effects of mandatory country of origin 
labeling on imported beef and lamb muscle cuts. As part of this study 
we will review the regulations and policies governing USDA grading of 
imported meat. The report will be submitted to Congress in April, as 
directed.
                         grain company mergers
    Question. Mergers such as the Cargill/Continental proposition are a 
major threat to producers as they have a great potential to create 
reduced competition and anti-trust. Cargill is currently the world's 
second largest grain company. Their acquisition of Continental makes 
them an even larger power. Grain producers are already faced with an 
extremely depressed market and do not need another problem to deal 
with--fewer marketing avenues and reduced competition. What action does 
USDA plan to take on agricultural consolidation?
    Answer. USDA shares your concern about the potential for mergers 
and concentration to reduce competition in agricultural markets. I have 
written to Attorney General Janet Reno strongly urging the Department 
of Justice to review carefully Cargill Incorporated's plan to acquire 
continental Grain Company's grain trading business. They need to 
determine whether the acquisition will notably increase concentration 
in agricultural and allied industries, causing potential adverse 
economic effects on farmers, ranchers, and consumers.
                          packer concentration
    Question. For major packers control 79 percent of the meat packing 
industry in the United States. The vast majority of livestock producers 
sell their feeder calves to feeder markets, which are highly 
concentrated. What action will USDA take on the packer monopoly?
    Answer. USDA has stepped up enforcement activities under the 
Packers and Stockyards Act by the Grain Inspection, Packers and 
Stockyards Administration. GIPSA will continue to investigate issues of 
major competitive significance in the livestock, meat packing, and 
poultry industries. Where anti-competitive practices are found in 
violation of the P&S Act, GIPSA will pursue appropriate remedies 
aggressively.
                       mandatory price reporting
    Question. Price reporting would increase market transparency as 
well as present producers an accurate view of the market situation each 
day. It is of utmost importance to have this data accessible to 
producers so that they may take advantage of the best possible market 
opportunities available at the most opportune time. What action will 
USDA take to ensure producers have mandatory price reporting data 
available?
    Answer. In the near future, the Administration will be submitting 
legislation to the Congress to provide the Secretary of Agriculture the 
discretionary authority to require the reporting of pricing data for 
livestock transactions.
                            predator control
    Question. $175,000 for predator control under APHIS was cut from 
Montana Wildlife Services. Montanans are dependent on this funding to 
operate aircraft for world depredation. If funding is not restored 
Montana's livestock producers will lose well in excess of the $175,000 
that was taken due to predator loss. How does USDA plan to compensate 
producers for predator loss as a result of this funding cut?
    Answer. The budget does not specifically identify where the 
reductions will need to be taken if APHIS is not successful in 
increasing the cost sharing for its many efforts in Wildlife Services.
                      fort keogh research station
    Question. $1 million was cut from the Fort Keogh Research Station 
in Miles City. This experiment station caries out extremely valuable 
research on sustainable environment, an area close to this 
administration's heart. Range research, which comprises most of the 
studies carried out at this station, promotes a sustainable environment 
more than any other research method. Research dollars are of utmost 
importance to educate producers and provide them with new ideas and 
avenues to market their products. In a depressed market they must find 
new marketing alternatives. Research and education dollars are a 
necessity to ensure they receive up-to-date and pertinent information. 
How does USDA plan to give farmers the necessary advantage to market 
their products with cuts like these?
    Answer. Large amounts of public and private research and 
cooperation have made US agriculture the marvel of the world. We intend 
to continue that effective research partnership by investing public 
research dollars in critical areas, such as sustainable environment 
where there is a significant public interest and where private industry 
is unlikely to take the risk. The Administration advocates a broad 
range of funding mechanisms in support of university-based agricultural 
research, education, and extension. These mechanisms, including formula 
programs, competitive grants, special grants and projects, and other 
programs--such as Smith-Lever 3(d)--are interdependent and jointly 
contribute to the success of our knowledge-based system of agriculture.
                           farm bill changes
    Question. You have said that one of the changes you would like to 
see in the current farm bill is a mechanism to help farmers build 
storage facilities. We believe we should be selling grain and reducing 
our stocks. What is the rational for this strategy?
    Answer. If producers do not have access to adequate storage, they 
are more likely to sell when prices are low during the harvest period. 
Access to transportation is also an issue. Marketing opportunities are 
limited for many farmers due to rail abandonment, so access to 
additional storage would provide these producers with some additional 
tools to manage risk.
    Question. How can constructing additional storage help producers?
    Answer. Much of the storage built during the 1970's is nearing the 
end of its useful life and may need to be replaced. As storage 
facilities wear out, farmers will be more likely to market when prices 
are low during the harvest season or be forced to pay commercial 
storage rates. If crops are large, and the marketing system cannot move 
all the grain at once, grain supplies may back up onto the farm and 
leave producers with no alternative but to store grain on the ground. 
On-farm storage could help to avoid such problems. Federal assistance 
in financing storage facilities would also help farmers obtain credit 
at favorable terms, which can be difficult through commercial sources.
    Looking ahead, as customers become increasingly sophisticated in 
their demands for grain with specific traits and characteristics, 
identity preservation is rapidly becoming key for suppliers. Increasing 
storage opportunities, in particular on the farm, will be an integral 
part of the grain marketing infrastructure that will be developed to 
market identity preserved grain.
    Question. You are also advocating an extension of loans. Won't 
allowing producers a longer period of time to settle loans tend to 
build stocks that will continue to depress prices?
    Answer. We advocate providing limited discretion to extend 
commodity loans when there is a breakdown in the marketing system, for 
example, in the event of a rail strike.
                      food quality protection act
    Question. Implementation of the Food Quality Protection Act (FQPA) 
has made farmers very nervous about the consequences of pesticide 
reduction regulations. We urge USDA to work closely with the EPA to 
take into account the effects this act has on farmers ability to 
produce a quality product which is competitive on the world market. 
Will USDA take the lead on this issue and weigh the potential harm the 
FQPA may cause American farmers and ranchers?
    Answer. EPA and USDA have agreed upon processes to ensure USDA 
involvement in risk assessment, risk mitigation, and other aspects of 
FQPA implementation. Along with our cooperators at the Land Grant 
Universities, USDA will take the lead in the development of transition 
strategies when they are required to reduce risk to acceptable levels. 
Transition Strategies will be developed in consultation with grower 
organizations.
                       animal feeding operations
    Question. Proposed new rules for Animal Feeding Operations (AFO's) 
are as detrimental to livestock production as the FQPA is to crop 
production. Will you assist us in Congress in undoing the EPA's blatant 
rewriting of the Clean Water Act, ensuring that the result of the 
Unified National Strategy for AFO rulemaking is fair and maintains our 
productive capacity at its current level?
    Answer. The Unified National Strategy for AFO's is not a rule or a 
regulation. Any proposed changes to legislation or regulations will 
have to have to go through the full rulemaking process. One of the 
guiding principles of the Strategy is to ``ensure that measures to 
protect the environment and public health complement the long-term 
sustainability of livestock production in the US''.
                    guaranteed farm ownership loans
    Question. Will USDA include in your current and future budgets 
sufficient money to replenish drained funds for guaranteed ownership 
loans to farmers and ranchers under the Interest Assistance Program?
    Answer. For fiscal year 1999, approximately $425 million was 
available for the guaranteed farm ownership loan program. FSA estimates 
that funding for this program will be depleted by mid-March, except for 
a small amount of funds set-aside for beginning farmer and socially-
disadvantaged targets. As a result of low commodity prices, many 
farmers and ranchers are facing cash flow problems this year, 
dramatically increasing demand for USDA's farm lending programs. In 
addition, demand for the guaranteed farm ownership loans, in 
particular, has increased due to: 1) a large carry-over of applications 
from last year, and 2) a change made by last year's agriculture 
appropriations bill which increased the loan limit on farm loans to 
$700,000 (previously there were separate limits of $300,000 for farm 
operating loans and $400,000 for farm ownership loans.
    The Administration recognizes the serious need for additional 
funding for this and the other farm loan programs, and we are currently 
considering a proposal for a supplemental funding request. Additional 
funding proposed specifically for the guaranteed farm ownership loan 
program would be about $350 million. We will work closely with Congress 
to ensure that farmers and ranchers have access to the credit they need 
to see them through to better times.
                       civil rights case backlog
    Question. Much remains to be done in the area of Civil Rights. 
According to information posted on the Office of Civil Rights Internet 
site as of March 1998, Montana had at least 19 cases of discrimination 
pending with the USDA, placing Montana in the same category as highly 
populated states such as Florida and New York. These people deserve 
better than this from an agency that was supposedly established to help 
American agricultural producers. I want to know when the people still 
in the process can expect prompt, responsive, and efficient handling of 
their complaints, not the foot-dragging, hurry-up-and-wait treatment 
they have received up to this point?
    Answer. We are committed to getting existing complaints resolved 
and to resolving all new complaints in a timely manner. We have issued 
new Departmental regulations that delineate complaint processing 
procedures that will get most program discrimination complaints 
resolved within 180 day. We are adding 30 staff to help us achieve that 
goal.
                   funding for crop insurance reform
    Question. President Clinton vowed to make crop insurance a top 
priority in the new Congress. However, absolutely no mention of crop 
insurance or funding of crop insurance is mentioned in the fiscal year 
2000 budget. With a risk management plan bankers are more likely to 
finance producers if they have both their crop and their price covered 
with a reliable insurance program. Where is the funding to reform crop 
insurance and how does USDA plan to address this issue.
    Answer. The fiscal year 2000 budget provides for an appropriation 
to the Federal Crop Insurance Corporation Fund of ``such sums as may be 
necessary'' for the continuation of the crop insurance program. This 
appropriation request is based on current law which is the usually 
manner in which such requests are made. A substantial amount of 
supporting information has been provided to the Congress to justify 
continued funding for the program. The improvements the President has 
vowed to make in the program will require legislation. A ``white 
paper'' detailing the Administration's proposals for improving the 
program was released along with the budget. The Administration has also 
announced that wants to obtain additional input from the public and to 
work with Congress on these proposals and other program improvements. 
There is a wide range of potential costs and various ways for funding 
the program, including the use mandatory spending. Once agreements are 
reached on the improvements that need to be made, the funding for these 
improvements can be worked out. This approach has been used before in 
developing farm legislation and it has worked well.
    As for your comment regarding the importance of risk management 
protection for both price and production, we agree whole-heartedly, and 
would note that, over the last few years, new revenue insurance 
products have been developed and have attracted an increasing portion 
of the business covered by the crop insurance program. Even under 
current law, is anticipated this trend will continue. Further, the 
fiscal year 2000 budget would provide additional funding for risk 
management education efforts to ensure that producers are informed of 
the broad range of tools available, such as futures trading and 
contractual arrangements, to help them manage risk.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
     farm safety net/emergency assistance emergency appropriations
    Question. Please provide an overview, to the extent possible by 
state and commodity, of the levels of emergency assistance provided to 
producers as a result of the $5.9 billion made available in the Omnibus 
Appropriations Act of fiscal year 1999.
    Answer. The emergency financial assistance to farmers and ranchers 
who have incurred losses associated with crops due to disasters is 
composed of several types of payments. The table below identifies each 
disaster program and it's associated program level.

 Summary of USDA Disaster Program Funding In 1999 Budget Agreement and 
                         Other Disaster Programs

                        [In millions of dollars]

                                                       Budget Authority/
        Items                                              Program Level
Commodity Credit Corporation:
    Market Loss Crop Payments.................................  2,857.0 
    Market Loss Dairy Payments................................    200.0 
    1998 Crop Losses ( \1\ ) \2\..............................  1,500.0 
    Multi-year Crop Losses ( \1\ ) \2\........................    875.0 
        (Includes Wheat Scab).................................    (30.0)
    Livestock Feed Assistance.................................    200.0 
    Salmon, Honey, Mohair.....................................     78.0 
    Food for Progress.........................................     25.0 
    NAP Raisin Provisions.....................................      3.0 
    Dairy Production Assistance...............................      3.0 
    Cotton Warehouse..........................................      5.0 
                    --------------------------------------------------------------
                    ____________________________________________________

            Subtotal, Budget Agreement........................  5,746.0 
                    ==============================================================
                    ____________________________________________________
Other Disaster Programs Implemented:
    Disaster Reserve Flood Compensation \2\...................     42.0 
    American Indian Livestock Feed \3\........................      8.5 
    Livestock Indemnity \4\...................................      4.0 
    Dairy Production Assistance \4\...........................      6.8 
    Small Hogs Operation Payments \5\.........................     50.0 
                    --------------------------------------------------------------
                    ____________________________________________________

            Total.............................................   5,857.3

\1\ Up to $400 million reserved for crop insurance buy-up on 1999 crops.
\2\ The program will be partially funded under Section 1102 of the 1999 
Appropriations Act which authorized the allocation of an additional $30 
million to the DRFCP.
\3\ Of the total program level of $12.5 million, $8.5 million is 
anticipated to occur in fiscal year 1999.
\4\ Provided for by the 1998 Emergency Supplemental Appropriations Act.
\5\ Program is funded by Section 32 funds, but delegated to FSA to 
administer.

    Just over $2.8 billion in Marketing Loss Assistance Payments have 
been made as of February 12, 1999. These payments include feed grain, 
wheat, upland cotton, and rice programs. The attached table identifies 
the States that have received payments.
                    timing and effect of assistance
    Question. Please include any timetables available to indicate when 
producers may expect to receive assistance plus and analysis of the 
degree to which the assistance made available by the aforementioned Act 
will remedy shortfalls in farm income due to either production or 
market losses in 1999.
    Answer.
    Within 10 working days of the omnibus bill's enactment, USDA began 
making income loss assistance payments. By November 21, 1998, USDA had 
paid 1.4 million farmers more than $2.8 billion.
    On November 12, 1998, USDA announced the Livestock Assistance 
Program (LAP) and began taking applications on November 23, 1998. To 
accommodate the extremely high demand for LAP, USDA extended the sign 
up for this program and now plans to close enrollment on March 25, 
1999. USDA will issue payments shortly thereafter. We estimate that the 
$200 million Congress appropriated for livestock assistance will be 
heavily over-subscribed and USDA, consequentially, will be able to pay 
only a portion of the total request.
    On March 15, 1999, the sales closing date for the 1999 crop 
insurance program, USDA will have disbursed the $400 million dedicated 
to lowering crop insurance premiums--the Administration's down payment 
on its commitment to strengthening the farm safety net by reforming and 
improving crop insurance.
    USDA has implemented the honey and mohair loan programs included in 
the bill.
    In the near future I will announce USDA's plans for the $200 
million dairy assistance program.
    USDA now expects to make CLDAP payments in June, following a six 
month sign up program, the same length of time USDA ran the sign up for 
the 1988 disaster assistance program, the last time USDA had to 
implement a major, new crop loss assistance program. While USDA was 
able to use the 1988 program as a template for subsequent programs, we 
could not do so for this year's program.
    The additional resources sought by the Administration and approved 
by Congress have been instrumental in keeping thousands of farmers and 
ranchers in business during tough times. USDA is at your disposal to 
provide any additional information about implementation of these 
programs.
                       state of the farm economy
    Question. Please provide any information available about the state 
of health of the farm economy at present and the extent to which 
producers may not be able to continue viable farming or ranching 
operations this coming year even with the assistance provided in the 
fiscal year 1999 Act.
    Answer. The farm economic outlook for 1999 is not favorable. In 
1998, the farm economy took a sharp downturn when bad weather 
devastated many production regions from California to Florida, while 
grain and oilseed prices nosedived as a result of large global 
supplies, the deepening Asian financial crisis, and weak export demand. 
Livestock prices also dropped due to large supplies, and hog prices 
went into a free fall late in the year. Unfortunately, exports and 
commodity prices likely will be even lower in 1999, causing increased 
farm financial stress, particularly in grain and oilseed producing 
areas, such as the Corn Belt States, that up to now have weathered the 
economic downturn.
    U.S. farm exports, for example, are expected to drop to $49 billion 
in fiscal year 1999--down $4.6 billion from fiscal year 1998 and nearly 
$11 billion from the peak in 1996. Net farm income is expected to drop 
to $44.6 billion for 1999, a 7-percent decline from 1998 and a 16-
percent drop from 1996. Net income just for key field crops (wheat, 
corn, soybeans, upland cotton and rice) will be 17 percent below the 
average for the past 5 crop years for the 1998 crops, and for the 1999 
crops, net income is projected to be 27 percent below the previous 5-
year average.
    USDA's revised baseline projections for the next 10 years indicate 
that economic recovery will occur at a very gradual pace.
    The nearly $6 billion in government assistance enacted last year is 
helping to maintain farm income and ease financial hardship for many 
producers. Direct government payments to producers reached nearly $13 
billion in calendar year 1998 and will probably total at least $11 
billion in 1999. Also, lower interest rates and fuel costs have helped 
reduce production costs, offsetting some of the decline in cash 
receipts for many producers.
    However, aggregate measures of the health of the farm economy mask 
a marked erosion in market income in many regions and commodity 
sectors, and all signs now point to greater farm financial stress in 
1999. Net cash income is currently projected to decline $3-4 billion. 
Land values began declining in a number of Midwestern States during the 
last half of 1998, after years of steady increases. The drop in income, 
coupled with declining asset values for many producers, means many will 
have difficulty obtaining credit, and those who do will use it for 
variable cash expenses, not investment, and will find themselves 
squeezed trying to repay debt out of current income. For the many 
producers who struggled with cash flow in 1998 because of adverse 
weather and low prices, problems likely will worsen in 1999.
    As a result of increased financial stress in farm country, demand 
for USDA farm loans in fiscal year 1999 has been extremely strong. Many 
farm families who have been financing their business operations through 
their own resources or with a minimum of commercial bank debt are now 
seeking farm loan assistance. Commercial lenders are utilizing Farm 
Service Agency loan guarantees to restructure the short-term 
indebtedness of their customers into more favorable long-term rates so 
that they can continue to provide financing. FSA is using all servicing 
authorities, including rescheduling and reamortizing, deferring 
installments, and debt writedowns to assist FSA borrowers.
    However, funds are exhausted or will soon be exhausted for key 
credit programs: all emergency loan funds and non-targeted direct farm 
ownership loan funds have been obligated already; non-targeted 
interest-assisted guaranteed loans and direct farm ownership loans will 
be exhausted in March; funding for direct farm operating loans will 
last into April, and guaranteed operating loan funding will be gone by 
August. Credit is no substitute for income, but adequate credit is 
essential to maintaining any farm operation.
    For many farmers and ranchers the key to weathering the farm crisis 
is duration: how long the period of low commodity prices will last. 
According to a 1998 Iowa State University study of 1200 Iowa farmers, 
those in basically strong or stable financial condition can withstand a 
year of low prices, but if these conditions were to continue for 
several years, one-third of the farmers in the study would face 
restructuring or liquidation.
    There are many uncertainties that could affect market demand and 
prices, and, hence, farmers' well-being over the next 1 to 2 years. 
Weather is always key; so is the world economy for a farm sector as 
export-dependent as American agriculture.
                          dairy policy reform
    Question. Would you please provide your observations or suggestions 
relating to changes in USDA programs to help move toward a more 
rational and fair dairy policy through either regulatory action or 
legislation? In particular, would you address steps that might be taken 
to help find a policy of comity among all regions to eliminate the 
otherwise unavoidable conflict and turmoil that would result from 
regional compacts or other tools of geographic disparity?
    Answer. On or before April 4th, the U.S. Department of Agriculture 
(USDA) will issue its final decision on consolidation and reform of 
Federal Milk Marketing Orders as mandated by the Federal Agriculture 
Improvement and Reform Act of 1996 (1996 Act) as amended. In the nearly 
three years since enactment of the 1996 Act, USDA has requested 
information from all segments of the dairy industry and received nearly 
4,500 comments on Federal order reform and consolidation. In addition, 
USDA established agreements with dairy industry experts in the academic 
community to analyze specific issues, including the Class I price 
structure and replacement of the Basic Formula Price (BFP) for milk, 
and conducted several listening sessions around the country before and 
after release of USDA's proposed rule in January 1998. We believe this 
meticulous approach in informing the public and obtaining input from 
interested parties will yield a final decision that is in the best 
interests of all segments of the dairy industry and be fair to all 
areas of the country.
                          emergency precedents
    Question. USDA recently announced the granting of $50 million to 
hog producers to help offset the dramatic reduction in price. How does 
the Department intend to address similar requests from producers of 
other commodities (e.g. beef cattle, aquaculture, minor crops, etc.) 
now that a precedent appears to have been established?
    Answer. Hog producers were hit with the lowest prices in five 
decades and we made every effort to find a way to help producers. We 
would hope to be able to help other producers in similar circumstances 
and are working hard to shore up the safety net for all farmers and 
ranchers.
                    rural rental housing assistance
    Question. The budget request for 2000 would reduce the amount 
available for Rental Assistance, in part, by deferring a portion of the 
funds until October 1, 2000. What effect would this action have on 
current tenants of eligible housing facilities and on the USDA housing 
programs generally?
    Answer. The manner in which the budget is requested for rental 
assistance will have no effect either on the flow of funds to the 
borrowers or on the tenants of the units. These funds are provided 
through five-year contracts and this permits spreading the budget 
authority over tow years.
                       effects of climate change
    Question. To what extent is climate change having an impact on USDA 
policies? Recent weather events lead to a conclusion that adverse 
conditions are affecting agriculture more severely and more 
significantly than in earlier decades, resulting in more volatile 
markets, reduced farm income, and disruption of consumer expectations. 
How is USDA responding to these changes in terms of long-term policy 
and what recommendations would you make for Congressional action in 
this regard?
    Answer. Temperature increases can have both positive and negative 
effects on crop and forest yields, with the difference depending on 
location and on the magnitude of the increase. And agricultural and 
forestry systems are most sensitive to extreme climatic events such as 
floods, wind storms, and droughts, and to seasonal variability. Climate 
change could alter the frequency and magnitude of extreme events and 
change seasonal patterns. Increases in rainfall intensity pose a threat 
to agriculture and forestry and the environment because heavy rainfall 
is primarily responsible for soil erosion, leaching of agricultural 
chemicals, and runoff that carries livestock waste and nutrients into 
water bodies. Adjustment costs are likely to be higher with greater 
rates of change. While climate change is not expected to seriously 
threaten the U.S. ability to produce enough food to feed itself through 
the next century, regional production patterns are likely to affected.
    Strategies such as changing planting and harvest dates, rotating 
crops, selecting varieties for cultivation, changing irrigation 
practices, fertilizers and pesticide use, and choosing cultivation and 
forest management practices can lessen potential yield losses from 
climate change and improve yields in regions where climate change has 
beneficial effects.
    We need to improve our understanding of how extreme events could 
affect agriculture and forestry and develop appropriate management 
systems for coping with these events. And we need more research to 
explain and predict how agriculture and forestry will be affected by 
climate change USDA investment in additional research on the adaptation 
of appropriate strategies is needed to gain a better understanding of 
the climatic factors that affect enterprise level adoption such as 
information flow, access to capital, and the role of global change 
public programs and policies.
    We need Congressional support for our fiscal year 2000 research and 
climate change technology programs so we can conduct this vital 
research and demonstrate alternative management practices that not only 
address the climate challenge but provide significant benefits in the 
form of improved productive capacity of our soils, improved water 
quality, and habitat protection. We would also welcome your ideas on 
how USDA's programs can be augmented to include greenhouse gas 
abatement and carbon sequestration. And we look forward to working with 
you to address the international challenge of reducing the atmospheric 
concentrations of greenhouse gases in the most cost-effective way.
    Question. Reduced farm income increases the difficulty of obtaining 
commercial credit. In many cases, commercial lenders are restricted by 
state and federal banking requirements in a manner that will adversely 
affect farmers when cash flow, debt to assets ratios, or other 
financial conditions can not be met. What role is USDA taking with the 
financial industry (including federal and state regulators) to help 
farmers overcome banking regulatory burdens?
    Answer. FSA provides substantive guaranteed loan assistance for 
bank customers who have been affected by the weakened farm economy. 
With this assistance from FSA, family farmers who otherwise would be 
prohibited from obtaining commercial credit are able to continue their 
credit relationship with their home-town banks. USDA has no influence 
over federal and state regulators. However, issuance of FSA loan 
guarantees to commercial lenders gives confidence to regulators that 
exposure to loan losses is reduced.
    Question. Does USDA intend to seek additional levels of direct farm 
credit for Farm Service Agency programs to help offset growing 
difficulty of farmers to obtain operating capital from commercial 
lenders?
    Answer. FSA will utilize all available resources in the farm loan 
programs to assist family farmers with their credit needs. Seeking 
additional funds for these programs is actively being considered.
    Question. Does USDA intend to seek additional farm credit funding 
budget authority for fiscal year 1999?
    Answer. Use of loan funds in all farm loan programs is being 
closely monitored. Deliberation will be given to seek additional 
funding authority for programs that will be exhausted before the end of 
fiscal year 1999.
                  loan deficiency payment calculations
    Question. It has come to my attention that differences in points of 
delivery for certain commodities in WI and MN are working to the 
detriment of Wisconsin farmers in the calculation Loan Deficiency 
Payments (LDP's). In other states it has been determined that the 
existing system for LDP calculations based on posted county prices did 
not accurately reflect prices received by producers. Please review the 
situation in Wisconsin and report your findings and actions taken to 
ensure fair and equitable treatment for Wisconsin producers.
    Answer. LDP's are calculated using county loan rates that are 
established once a year and Posted County Prices (PCP) that may change 
daily. There is a common misconception that the PCP pricing system was 
designed to ensure that all producers of a commodity have the potential 
of earning the same marketing loan gain or LDP. In actuality, the 
primary objective of the PCP system is to determine a value as close as 
possible to the local cash market price in any given area. The PCP 
system was designed to provide producers with equitable, but not 
necessarily equal value for their commodities.
    The Kansas City Commodity Office (KCCO) conducts weekly surveys of 
187 counties in major production areas throughout the nation to 
determine if Posted County Prices (PCP's) accurately reflect local 
market prices. The most recent surveys for corn and soybeans were 
conducted on March 9 and included four counties in Wisconsin. In 
general, the results indicate that PCP's in Wisconsin accurately 
reflect local market conditions for these commodities.
    If you have specific questions concerning PCP for a specific 
commodity or region of Wisconsin, I encourage you to submit your 
comments to the Farm Service Agency for further review.
                   study of dairy prices and the wto
    Question. Section 151 of the Federal Agriculture Improvement Act of 
1996 calls for a study and report regarding the United States 
membership in the World Trade Organization and the potential impact of 
such membership on domestic dairy prices, federal dairy programs, and 
other related items. This report was to be provided to the House and 
Senate Agriculture Committee's no later than July 1, 1997. Please 
provide information on the status of this report and, if complete, 
would you please provide a copy to this subcommittee?
    Answer. The analysis for the study of the impact on milk prices, 
producer incomes, and dairy program costs of additional access 
resulting from U.S. obligations under the World Trade Organization has 
now been completed and the final report is currently being prepared. We 
will transmit a copy of the report to Congress as soon as it is 
completed.
                     fsis user fees and farm income
    Question. Please explain if you disagree that any FSIS user fee 
imposed on meat and poultry companies would not be passed on solely to 
producers. Do you believe the major meat and poultry companies act more 
competitively in their relationship with consumers than producers? If 
so, please explain?
    Answer. We do not estimate that the impact of the user fees will be 
passed down to producers in the form of lower prices paid. We estimate 
that most of the fees will passed on to consumers in the form of higher 
retail prices. We estimate that the cost will be passed onto consumers, 
because they are less likely to decrease the amount of meat and poultry 
they consume as result of higher the higher prices created by the 
proposal. The overall impact on retail prices would be less than one 
cent per pound.
    Question. If so, why is there so much concern expressed by the 
Department and elsewhere about concentration with the agricultural 
industry, especially in regard to the livestock sector and the effect 
of concentration on farm prices?
    Answer. There is much concern about concentration in the livestock 
sector, because in 1997 the top 4 firms slaughtered 80 percent of the 
steers and heifers, 54 percent of the hogs, and 74 percent of the sheep 
and lambs. USDA has placed a high priority on addressing issues 
surrounding the high levels of concentration in the meat packing 
industry. Where anticompetitive practices are found in violation of the 
Packers and Stockyards Act, USDA will pursue appropriate remedies 
aggressively.
                     emergency forestry assistance
    Question. Emergency Forestry Assistance. The fiscal year 1999 
Appropriations Act included $10 million in emergency funding through 
the Forestry Incentives Program (FIP) related to forest fires in 
Florida and disasters in other states, including Wisconsin. What is the 
status of providing this assistance and what plans for distribution of 
benefits do you intend to use? Additionally, what timetable do you 
envision for delivery of this assistance? Since the identified need in 
Wisconsin is nearly $1.3 million for disasters in 1998, and since $10 
million provided nationally will not cover all identified needs, will 
the Department reflect these shortfalls in emergency funding to states 
based on an appropriation of FIP funding for fiscal year 2000?
    Answer. On February 16, 1999, $9 million in Forestry Incentives 
Program (FIP) funds were allocated to 17 States to address 
reforestation needs caused by wildfires and other natural disasters in 
1998. A $1 million reserve is being retained for future assistance, 
primarily for tree planting needs in Florida. USDA's Natural Resources 
Conservation Service (NRCS) and Forest Service, along with State 
foresters, are currently delivering the services associated with this 
funding. The Administration's fiscal year 2000 budget currently does 
not request funding for the FIP program in fiscal year 2000.
                               sanctions
    Question. Please provide an update on U.S. negotiations regarding 
the lifting of sanctions against countries such as Cuba and Iran in 
terms of the implications for agriculture. Please provide any 
information relating to the effect the lifting of such sanctions would 
have for U.S. producers.
    Answer. In the case of Cuba, last January, the President announced 
an initiative to enhance U.S. support of the Cuban people and to 
promote a peaceful transition to democracy. As part of this initiative, 
the United States is implementing certain ``new measures'' including 
allowing exports of food and certain agricultural commodities to Cuba. 
Exports are limited to non-governmental entities in Cuba so that 
eligible recipients are effectively small ``mom and pop'' shops, 
private farmers and restaurants. While this represents an important 
first step, the immediate impact on the level of exports of agriculture 
products to Cuba is likely not to be great. USDA will continue to work 
with the Commerce Department in drafting the regulations that will 
govern these sales.
    If sanctions on Cuba were lifted, the United States could 
reasonably expect to supply about half of Cuba's agricultural imports 
or about $350 million annually. According to some analysis, Cuba has 
the potential to become a $1 billion market for agricultural exports 
after substantial investment occurs, which would make Cuba the second 
largest U.S. agricultural export market in Latin America.
    With respect to Iran, in December, the Treasury Department received 
a request for approval of a license to broker a sale of approximately 
$500 million in agriculture exports to Iran. While a sale of this kind 
is currently prohibited under the terms of the comprehensive embargo 
against Iran, the request is being given serious consideration by the 
Administration. USDA is working to ensure that all points of view are 
represented in the decision-making process.
    Despite heavy competition from Australia, Canada and South America, 
if normal relations were resumed with Iran, it is not unreasonable to 
expect that U.S. agricultural exports to Iran could reach $300 million 
in a relatively short period of time and perhaps twice as much within 
five years. Principal gains for U.S. exports would be in grains and 
oilseed products.
                          assistance to russia
    Question. There have been recent claims that Russia has executed 
sales of wheat to Iraq. Although there appears to be no evidence that 
these sales involved the conveyance of commodities originating in the 
U.S. (notwithstanding the fungibility of commodities such as wheat) 
these allegations do raise certain questions about the role of U.S. 
assistance in Russia. Please provide information that outlines the 
steps the U.S. is taking to ensure that food assistance to Russia is 
actually being delivered to the populations intended.
    Answer. First, it is important to note that Russian government 
officials have assured USDA that such shipments are not being 
considered.
    Second, USDA is taking extraordinary steps to oversee the Russian 
food aid package and thereby ensure that the assistance is provided to 
the targeted population. To avoid any mishandling of the commodities, 
USDA has set up a broad system to monitor compliance of the Russian 
government with its commitments under these food aid agreements. 
Monitoring will be necessary in two broad areas: (1) the importation, 
distribution and sale of the commodities and (2) the deposit of 
commodity sale proceeds into the ``Special Account'' by the Russian 
Government and subsequent transfer into the Russian pension fund. USDA 
monitoring of the agreements will be designed to minimize the potential 
for fraud and abuse in the distribution and sale of food aid 
commodities, and to ensure that appropriate reporting and monitoring 
systems have been designed to ensure that such problems do not occur.
    A key item in the process is the establishment of a U.S. Russian 
working group in Moscow to identify and resolve any irregularities. The 
working group is under the supervision of the Minister Counselor for 
Agricultural Affairs, and bears responsibility for approving the 
Russian work plans, reviewing logistics and financial reports, 
estimating the ruble value of commodity shipments, and recommending to 
the Minister Counselor disbursements from the Special Account to the 
Pension Fund of the Russian Federal Budget.
    On the logistics side, USDA is requiring detailed work plans from 
Russian authorities about how and where commodities will be 
distributed, and the Russian government will be required to report on 
its fulfillment of those work plans.
    On the financial side, all records of the Russian Government and 
its agents must be made available for inspection by USDA monitors. In 
addition, a bi-weekly financial report submitted by the Russian 
Government will be reviewed by the working group.
    In addition, USDA has established a monitoring group within the 
U.S. Embassy. At least four individuals from USDA will be detailed to 
Russia on a full-time basis to assist in this effort. The staff will be 
placed in both the U.S. Embassy, Moscow and the U.S. Consulate, 
Vladivostok. At any one time, at least two of these individuals will be 
traveling to the regions to meet with local officials and 
organizations, perform spot checks on the deliveries of commodities, 
and investigate any allegations of fraud or mishandling of the 
commodities. Data on the progress of shipments will be tracked in 
Moscow using a sophisticated database created specifically for this 
purpose.
    Besides the joint U.S.Russian monitoring effort and these 
independent U.S. activities, the Russian government has established its 
own audit and control operations. The economic crime control unit of 
the Ministry of Internal Affairs will be tracking the commodities as 
they move within the country, from discharge at the port or point of 
entry to purchase within the regions. In addition, the State Customs 
Committee and the Ministry of Railways have established their own joint 
committee to track the food aid shipments.
    USDA believes these actions will greatly help to assure our food 
aid benefits a broad spectrum people in Russia who are experiencing a 
very difficult situation.
                                pakistan
    Question. Last year, Congress took action relating to sanctions 
against Pakistan in order to help protect U.S. agricultural interests 
in that country. Now, we hear an opportunity exists to provide an 
additional 200,000 tons of wheat to Pakistan, but since that nation is 
in default on GSM loans, that sale (or any other) is in jeopardy. What 
is USDA doing to help protect markets such as this?
    Answer. To help Pakistan meet its wheat import needs and preserve 
U.S. access to that market this year, USDA has donated a total of 
300,000 metric tons of wheat under the authority of section 416(b) of 
the Agricultural Act of 1949. The wheat will be shipped this spring. In 
addition, USDA is providing to Pakistan $15 million worth of additional 
wheat and $10 million worth of soybeans under the Public Law 480 Title 
I concessional sales program. These food aid activities are not 
precluded by the default under the CCC export credit guarantee program.
    Question. To what extent is the Pakistan problem related to the 
general financial pressures in that part of the world?
    Answer. The Asian financial crisis is a contributing factor to 
Pakistan's current financial woes, along with the economic sanctions 
imposed after the nuclear tests in May, and Pakistan's own difficulties 
in managing its economy effectively. The extent to which financial 
problems in Asia have affected Pakistan's finances in general and its 
ability to buy U.S. wheat in particular is difficult to quantify.
    For example, the value of cotton and textiles exports, which 
constitute about two-thirds of Pakistan's $7.5 billion annual export 
earnings, is down about 15 percent this year compared to last. This is 
partly due to reduced exports to Far Eastern markets as a result of the 
economic downturn there and partly due to depressed prices in general 
as a result of the global economic situation. At the same time, worker 
remittances (a major source of foreign exchange) have virtually dried 
up since the Government of Pakistan's hard currency bank accounts were 
frozen last May following the nuclear tests.
    Question. How many other trading partners, or potential trading 
partners, are in similar situations?
    Answer. Pakistan has managed to remain current on payments to the 
Australian and Canadian wheat boards, so those agencies do not face the 
same situation as the United States.
                     dairy export incentive program
    Question. The fiscal year 2000 budget reflects a decrease in this 
program. Please provide information relating to this program's use in 
fiscal year 1999 and the reasons for the projected reduction in 2000.
    Answer. The President's budget assumes that bonus awards under the 
Dairy Export Incentive Program will reach $99 million in 2000, which is 
just slightly below the level of $102 million projected for 1999. 
However, these numbers are only projections of program activity. The 
actual level of DEIP bonus awards in both 1999 and 2000 will be 
determined by market conditions and the Uruguay Round Agreement subsidy 
reduction commitments.
                          banana regime issues
    Question. A February 3rd article in the Journal of Commerce 
discusses the relationship of the current Banana Regime issue with the 
overall economies in the Caribbean Basin and suggests that a U.S. 
victory at the WTO may ultimately cause the U.S. more harm than good. 
Would you please comment on that statement and provide an overview of 
the implications of the Banana Regime issue on U.S. agricultural trade?
    Answer. The issues in the EU Banana Regime case ultimately test 
whether the EU will provide access to its market on a fair and non-
discriminatory basis. While the Banana case does not present a 
situation in which U.S. agricultural products are being denied access, 
it does present a situation in which U.S. businesses that supply or 
service agriculture (e.g., U.S. farm equipment manufacturers, 
fertilizer producers, marketing firms, etc.) have suffered injury 
because of discriminatory practices. Maintaining the principles of fair 
access to the EU market is an important issue for U.S. agriculture in 
general.
    The Banana case also tests whether the EU will comply with its 
obligations under the WTO or will ignore the Dispute Settlement Body 
(DSB) Panel rulings. If it ignores the DSB rulings, the benefits of the 
Uruguay Round will be put at risk for all members.
    The United States, and U.S. agriculture in particular, has a strong 
interest in an effective WTO dispute settlement mechanism. Since the 
WTO was established in 1995, the United States has received favorable 
decisions in three agricultural cases and has three other cases pending 
where preliminary findings have supported our positions. In addition, 
the United States has resolved a number of agricultural issues through 
the WTO consultation mechanism without going to a panel.
                              food safety
                             bio-terrorism
    Question. Please explain the steps USDA is taking, along with other 
Federal agencies, regarding the threat of intentional contamination of 
our food supply as either part of an international terrorism threat or 
any other means. To what extent does the President's Food Safety 
Initiative address this issue?
    Answer. APHIS has requested $1.2 million in the fiscal year 2000 
President's Budget to develop a national emergency management system to 
meet the needs of emergency disease outbreaks and emerging animal 
health issues including microbiological residues, manure management, 
transmissible spongiform encephalopathies, and biological terrorism. 
Components of the system would include prevention activities such as 
surveillance and a national disease reporting system; preparedness 
activities such as training and the development of response plans; and 
response and recovery activities. Of the $1.2 million, approximately 
$700,000 would be used to survey for significant animal health events 
including biological terrorism. APHIS would also conduct 4 training 
sessions for Agency and State employees and industry representatives 
regarding biological terrorism, decontamination procedures, and other 
animal health events. The remaining $500,000 would be used to complete 
a master plan for the new system and to develop a National Animal 
Disease Reporting System and Geographical Information System. The 
President's Food Safety Initiative does not include any funds for 
bioterrorism activities.
                                 haccp
    Question. Please provide information regarding the effect HACCP 
implementation is having on small firms. Since implementation of HACCP 
at the small firm level is very recent, have there been any 
unanticipated problems that should be considered by the Appropriations 
Committee that might not have been known at the time the fiscal year 
2000 budget request was being developed?
    Answer. Approximately 2,200 small establishments were required to 
implement Hazard Analysis and Critical Control Point (HACCP) systems by 
January of this year. At this time we have not encountered any serious 
problems.
                         pesticide data program
    Question. Please provide information explaining the role of the 
Pesticide Data Program (PDP) within the context of food safety. Also, 
please provide information that directly links the PDP to the 
availability of pesticides for producers, especially for producers of 
minor crops.
    Answer. The Pesticide Data Program (PDP) provides data on pesticide 
use and residue detections for a variety of commodities as close to the 
point of consumption as possible. The program was created to strengthen 
the Government's ability to respond to food safety concerns, to protect 
public health, and to provide the Environmental Protection Agency (EPA) 
with the data needed to assess the actual dietary risk posed by 
pesticides. The availability of this data has become more critical with 
the passage of the Food Quality Protection (FQPA), which established 
more stringent health-based standards for pesticide residues to assure 
protection of the public, especially for at risk populations, such as 
the elderly and children. Without actual residue data, risk assessment 
studies for pesticides are based on a theoretical maximum amounts of 
pesticide use. Such studies may greatly overstate the exposure to 
consumers and may jeopardize EPA's registration of pesticides important 
to agriculture. The Food and Drug Administration (FDA) utilizes the 
data to more accurately identify and respond to instances in which 
pesticide residues exceed established tolerances.
    About 88 percent of PDP data are for pesticide residues on minor 
crops. These data have been extremely useful in conducting evaluations 
necessary to retain the pesticide registration for pesticides needed to 
sustain minor crops.
                income, markets, and resource protection
                            invasive species
    Question. Please provide information relating to potential cost to 
the national economy due to the existing and potential introduction of 
alien species for which USDA has regulatory jurisdiction. In what areas 
of the nation are these problems the most serious?
    Answer. On February 3,1999, the President announced an Executive 
Order to expand the effort to address the growing environmental and 
economic threat of invasive species. This order establishes an 
interagency Invasive Species Council with the Department's of 
Agriculture, Commerce and Interior with the Secretaries as co-chairs. 
Experts estimate that invasive species already infest over 100 million 
acres of the United States and is growing at a rate of 3 million acres 
annually. The costs to the U.S. economy are about $123 billion 
annually.
    Question. Is there any way to better protect areas into which these 
species may migrate in the immediate future?
    Answer. The Council will develop a comprehensive plan to minimize 
the economic, ecological, and human health impacts of invasive species 
and determine further steps to prevent the introduction and spread of 
invasive species.
    Question. From a budgetary perspective, keeping in mind the 
constrains on this subcommittee, what are the best strategies to 
control the threat from these pests?
    Answer. The USDA budget includes an increase of $16 million for 
programs to combat invasive species by preventing entry, improving 
monitoring and detection, providing rapid assessment and eradication, 
increasing crosscutting research and technology, and developing 
partnerships directed at education and outreach.
                         organic certification
    Question. Please provide information regarding finalization of the 
Organic Certification program. In which areas of the nation do you 
believe this program will be the most important from both a producer 
and consumer perspective?
    Answer. USDA is currently working with the organic community and 
consumers to develop a regulation that responds to the 275,000 comments 
received in response to the proposed rule. Since publication of the 
rule, USDA has published several issue papers to gather further input 
on animal confinement, animal medications, and procedures for 
termination of producer certification. USDA's goal is to establish 
clear, consistent regulations that stimulate the growth of the organic 
livestock sector, satisfy consumer expectations and allow organic 
livestock producers flexibility in making site-specific, real-time 
management decisions. Although some areas of the country may produce 
more organic product than others, both producers and consumers 
Nationwide will benefit from the uniform standards established by this 
rule.
                        wetlands reserve program
    Question. Will the expected enrollments in the Wetlands Reserve 
Program (WRP) in fiscal year 2000 bring total enrollments to the fully 
authorized level?
    Answer. Yes, the requested enrollment for fiscal year 2000 would 
bring the total WRP enrollment up to the 975,000 acre enrollment cap.
    Question. In the event the WRP enrollment authorization is met, 
does USDA intend to request additional authorization? If so, when and 
to what levels?
    Answer. Once the cap is reached, USDA would have to seek new 
authority to enroll additional acres. The President's Clean Water 
Action Plan recommends that up to 250,000 acres be enrolled in the WRP 
each year over a five-year period.
                  watershed infrastructure reliability
    Question. Watershed Infrastructure Reliability. Since many 
watershed structures are reaching their life expectancy, what does USDA 
plan to do to help avoid continuing deterioration of these structures 
beyond educational activities?
    Answer. Beyond the one-time educational program, USDA has no firm 
plans to address the continuing deterioration of the structures built 
under the Small Watershed Program. However, USDA is exploring ideas on 
how best to assist sponsors in addressing the problem within current 
authorities and budget constraints.
    Question. To what extent does the current status of these 
structures present a threat to public safety?
    Answer. In some instances, especially with older watershed 
structures that have not been properly maintained, there has been 
significant deterioration which could create an imminent threat to 
public safety. While downstream developments are also placing people at 
risk, there have been no examples where failure of an NRCS assisted 
structure resulted in loss of life.
    Question. Please explain if you believe the level of activity 
needed to correct the problem of deteriorating infrastructure does not 
rise above the normal maintenance requirement, and thereby places 
burden of repair solely on local watershed organizations.
    Answer. The problem of deteriorating dams after they reach their 
designed life is more complex than sponsors merely not maintaining the 
dams. However, it is our current position that the sponsors of dams 
built under the Small Watershed Program are responsible and liable for 
the operations and maintenance, as well as compliance with all state 
and federal laws involving dam safety and environmental permits. 
Currently, USDA has no statutory authority to provide financial 
assistance for operations, maintenance nor rehabilitation.
                 resource conservation and development
    Question. Do you believe Resource Conservation and Development 
(RC&D) districts should be expanded in number or should the areas be 
expanded geographically? Should the RC&D program contain a 
``graduation'' requirement which would allow new districts to come into 
the program as others leave due to either completion of RC&D goals or 
inactivity?
    Answer. At current funding levels, we can only adequately support 
the 315 existing RC&D areas and could not afford any program expansion. 
There are currently 37 applications for new area authorizations on file 
with an additional 20 councils being formed.
    The RC&D program should only contain a ``graduation'' requirement 
for those RC&D Councils found to be inactive or performing below a 
minimum level. This would be a `de-designation' of a RC&D area. USDA, 
in consultation with the National Association of RC&D Councils, Inc. 
has developed minimum performance criteria for RC&D Councils. The 315 
existing designated area councils will be requested to assess their 
performance using this criteria this fiscal year and identify actions 
to improve where needed. Inactive or limited performance councils would 
be provided the opportunity to revise their area plan and strengthen 
results. USDA could then determine to withdraw assistance if 
insufficient progress occurs. We expect that this would rarely occur.
                    rural housing rental assistance
    Question. The budget request for 2000 would reduce the amount 
available for Rental Assistance, in part by deferring a portion of the 
funds until October 1, 2000. What effect would this action have on 
current tenants of eligible housing facilities and on the USDA housing 
programs generally?
    Answer. The 2000 budget actually provides for an increase in rental 
assistance, from $583 million that was appropriated for 1999 to $640 
million for new and expiring contracts in 2000. Rental assistance is 
provided through 5 year contracts and dispersed over the period of 
these contracts. Therefore, it is not necessary to have the total 
amount of funds to support these contracts available in the fiscal year 
they are made. While the 2000 budget reflects a change in the way 
rental assistance is budgeted, making some of the funding available in 
a subsequent budget year, this change is not expected to have any 
impact on program recipients. The 2000 budget provides sufficient 
funding for the renewal of all existing rental assistance contracts 
that are expected to expire in 2000, and for new contracts to support 
the loans and grants expected to be made for farm labor housing and the 
on-going rural rental housing loan program.
                        formula research funding
    Question. For the first time in many years, Congress in fiscal year 
1999 appropriated funding level increases for many of the Formula 
Funded research programs, such as Hatch Act, Smith-Lever, and other 
programs important to states and rural areas. However, the fiscal year 
2000 budget request, again, calls for significant reductions in these 
accounts. Please explain the rationale for these reductions, the 
anticipated effect it will have on state and country based research and 
extension activities, and the extent to which USDA consulted with its 
state and local partners in this decision.
    Answer. The Administration advocates a broad range of funding 
mechanisms in support of university-based agricultural research, 
education, and extension. These mechanisms, including formula programs, 
competitive grants, special grants and projects, and other programs--
such as Smith-Lever 3(d)--are interdependent and jointly contribute to 
the success of our knowledge-based system of agriculture. Although some 
states may be impacted by the cut in formulas, the vast majority 
continue to match federal dollars at a rate of four state dollars to 
every federal dollar. The priorities which define Federal support for 
programs in agricultural science and education are developed through a 
collaborative, State/Federal process of consultation with stakeholders, 
mutual planning, and in almost all cases, joint investment.
                             methyl bromide
    Question. Please provide information regarding USDA activities in 
fiscal year 1999 and in the fiscal year 2000 budget relating to methyl 
bromide alternatives, including your expectations on finding an 
acceptable alternative in the near term, and please note any changes in 
program activities that may have resulted from last year's extension of 
production phase-out from 2000 until 2005.
    Answer. In fiscal year 1999, ARS has nearly $14,400,000 
appropriated for research on methyl bromide alternatives. The funds 
currently are distributed among 20 ARS locations (see table). About 
half of the funds are in the two states that are most impacted by the 
impending loss of methyl bromide--California ($4,374,000) and Florida 
($3,029,000). The Honolulu, HI, and Weslaco, TX, locations, where 
research on methyl bromide alternatives for quarantine purposes is 
conducted, account for an additional 25 percent of the funding 
($3,168,000).
    ARS Funding for Methyl Bromide Alternatives Research is as follows:

------------------------------------------------------------------------
                                            Fiscal Year     Fiscal Year
                Location                       1999            2000
------------------------------------------------------------------------
Davis, CA...............................       $ 226,000       $ 226,000
Fresno, CA..............................       3,485,400       3,485,400
Riverside, CA...........................         126,600         126,600
Salinas, CA.............................         535,900         535,900
Washington, DC..........................         241,200         241,200
Gainesville, FL.........................         213,000         213,000
Miami, FL...............................       1,219,300       1,219,300
Orlando, FL.............................       1,597,100       1,597,100
Byron, GA...............................          83,900          83,900
Tifton, GA..............................         462,200         462,200
Honolulu, HI............................       1,684,700       1,684,700
Manhattan, KS...........................          70,800          70,800
Beltsville, MD..........................       1,048,200       1,048,200
Stoneville, MS..........................         182,200         182,200
Corvallis, OR...........................         487,400         487,400
Charleston, SC..........................         330,600         330,600
Weslaco, TX.............................       1,482,900       1,482,900
Wenatchee, WA...........................         209,200         209,200
Yakima, WA..............................         258,000         258,000
Kearneysville, WV.......................         435,000         435,000
                                         -------------------------------
      Total.............................      14,379,600      14,379,600
------------------------------------------------------------------------

    Other USDA agencies with methyl bromide alternatives research 
projects are the Forest Service (FS) and Cooperative State Research, 
Education, and Extension Service (CSREES). The Forest Service (FS) has 
reestablished nursery programs at Athens, Georgia, and St. Paul, 
Minnesota, with the goal of developing integrated pest management 
programs that will ensure high quality seedlings. In the postharvest 
area, FS, together with the Foreign Agricultural Service(FAS)and the 
Animal and Plant Health Inspection Service (APHIS), has been successful 
in negotiations to get U.S. heat-treated coniferous wood accepted into 
Europe and kiln-dried lumber into Korea in lieu of fumigation with 
methyl bromide. CSREES, which administers the NRI competitive grants, 
has funded research on biological control of soilborne diseases.
    An increase of $5 million is proposed in fiscal year 2000 for a new 
competitive grants program in CSREES aimed to support the discovery and 
implementation of practical pest management alternatives for 
commodities affected by the methyl bromide phase-out. The new program 
will focus on short- to intermediate-terms solutions for all 
commodities at risk. Activities will involve research designed to 
deliver and demonstrate the practicality and economic feasibility of 
new technologies.
    An acceptable alternative must allow growers to raise a profitable 
crop reliably from year to year. In the short term, it is clear that 
acceptable alternatives will have to come from among those already 
under development and testing. Because methyl bromide is effective over 
a wide range of soil types, climates, and crops, no single alternative 
is available to replace all the uses. The most likely short-time 
alternatives will be replacement fumigants that are already registered. 
Other kinds of alternatives, such as resistant varieties, biological 
control, and cultural improvements, show promise; but there is not 
enough time to develop and adapt them to acceptable cropping systems 
before the phase-out. Even for replacement fumigants, results are mixed 
and not as consistent as methyl bromide--probably why the replacements 
have not been widely adopted as long as methyl bromide is available.
    Although there are likely to be short-term replacements for some 
uses of methyl bromide, in most cases, the alternative is likely to 
cost more and be less effective. Serious economic consequences and 
shifts in agriculture within states and among foreign countries are 
expected.
    The strategy for finding alternatives is not expected to change 
because of the extension of the phase-out; there will just be more time 
to look for solutions. The strategy remains to identify and develop 
alternatives in laboratories and small plots, then test the most 
promising ones in larger plots under a variety of conditions, and 
finally to select the most effective and validate their effectiveness 
in commercial field-scale settings. The final stages are done with the 
cooperation of the agriculture industries and growers, many times on 
grower land.
                            user fee offsets
    Question. Section 754 of the fiscal year 1999 Appropriations Act 
directed that any submission of unauthorized user fees in the fiscal 
year 2000 budget request before this subcommittee would have to include 
certain additional information if the revenue for those fees was 
necessary to meet the President's budget authority requirements. While 
the budget authority request for FSIS appears to include the full 
amount necessary for inspection and related activities in fiscal year 
2000, the table found on page 379 of the Budget reflects a total 
discretionary requirement for this subcommittee that assumes the $504 
million in proposed revenues from unauthorized user fees for FSIS 
activities. Please list by USDA agency and by amount any assumptions of 
revenues from unauthorized user fees to achieve the discretionary 
spending found on page 379 and, consistent with Section 754 please note 
the funding levels currently in the budget request recommended for 
reduction in the event the fees in question are not authorized prior to 
the convening of a committee of conference for the fiscal year 2000 
appropriations bill.
    Answer. We will provide the information for the record.
    [The information follows:]

   FISCAL YEAR 2000 FEE PROPOSALS WHICH IMPACT DISCRETIONARY SPENDING
                        [In millions of dollars]
------------------------------------------------------------------------
                                                              Budget
              Agency                      Proposal           Authority
------------------------------------------------------------------------
Food Safety and Inspection          Salaries and                    -504
 Services.                           Expenses. This
                                     proposal would
                                     charge fees for the
                                     full cost of
                                     providing Federal
                                     inspection of meat,
                                     poultry, and egg
                                     products. The user
                                     fees exclude Grants
                                     to States and
                                     Special Assistance
                                     to State Programs..
Animal and Plant Health Inspection  Salaries and                      -9
 Service.                            Expenses. This
                                     proposal would
                                     establish user fees
                                     for costs for
                                     animal welfare
                                     inspections and
                                     issuance of
                                     biotechnology
                                     certificates..
Grain Inspection, Packers and       Salaries and                     -19
 Stockyards Administration.          Expenses. This
                                     proposal would
                                     establish a fee for
                                     grain
                                     standardization and
                                     a licensing fee to
                                     cover the costs of
                                     administering the
                                     provisions of the
                                     Packers and
                                     Stockyards Act
                                     relating to meat
                                     packing and
                                     stockyards
                                     activities..
------------------------------------------------------------------------

                  county and state office streamlining
    Question. To what extent are total agency costs in the office 
consolidations considered? For example, would USDA require relocation 
of a state office for one agency in order for all state agencies to be 
in a single location if the cost for the relocation exceeded the costs 
of current locations?
    Answer. FSA with NRCS and RD will be establishing a working group 
comprised of representatives from management and the unions to develop 
a plan for implementing office consolidations where these are not 
already in place. The working group will be looking at every aspect of 
plans to achieve savings under current budget resources. It is possible 
that the benefits to producers and field offices of a common state 
office location could outweigh a somewhat higher cost, yes.
                employee reductions and office closures
    Question. Since budget constraints are resulting in lower service 
levels in field offices due to increased workload and a reduced 
workforce, has USDA conducted an evaluation to determine when the 
continuation of a county office in a given location is of less 
importance to the customer than the maintenance of ``service'' in the 
area? At what point does the presence of a workforce in an area become 
more important than the existence of a field office regardless of 
whether that office can meet workload requirements?
    Answer. The Agency is continually monitoring workload in States to 
determine areas of increased workload and moves both human and monetary 
resources to those areas based on availability to provide the most 
effective and efficient service to its customers. State Executive 
Directors have been charged to use all management tools available to 
ensure that producers are served as expeditiously as possible using 
details, directed reassignment of employees, shared management and 
office collocation and consolidation to get the work accomplished. When 
the cost of keeping a service center in operation exceeds the benefit 
of service provided at the counter, States consider closure and 
consolidation of operations to improve efficiency but only with 
Congressional concurrence.
       farm service agency federal and county employment statues
    Question. Please provide an update on activities relating to the 
conversion of Farm Service Agency (FSA) county personnel to Federal 
status.
    Answer. No further discussion or action has been taken in 
converting FSA county employees to Federal status. Currently, the 
Secretary is on record as being in favor of this conversion. No 
Congressional action has been taken to enact this proposal. However, on 
October 21, 1998, the President signed Public Law 105-277 which 
contained a section to provide permanent FSA County Office committee 
employees with Federal Civil Service status for only the purpose of 
applying for USDA Civil Service vacancies.
               farm service agency salaries and expenses
    Question. The fiscal year 2000 request for FSA Salaries and 
Expenses includes an $80 million increase, although that increase does 
not take into account the additional $40 million provided as emergency 
spending in fiscal year 1999 which reduces the actual increase to $40 
million. To what extent has the FSA Salaries and Expenses account been 
supplemented by carryover balances in past years and how much will be 
available in fiscal year 2000?
    Answer. Historically, there has been carryover in past years. FSA 
has both Federal offices and Non Federal County Offices, and the 
ability to obligate administrative funds for carryover workload is 
authorized by a general provision in each year's appropriation act, 
which is only applicable to the non Federal county offices. Funds 
obligated for carryover workload expenses are normally kept at a 
minimum. Funds made available to county committees in a fiscal year are 
based on actual and estimated workload and staff year requirements 
according to the FSA County Office Work Measurement and Funding 
Allocation System. Requirements are updated during the year to take 
into account changing conditions. Programs administered by county 
committees are highly volatile in nature and subject to rapid changes. 
Such changes include weather conditions, domestic market prices, export 
sales, legislative and policy changes. Many emergency programs end up 
being quickly administered at mid-fiscal year or late in the fiscal 
year. In a disaster situation the top priority is to furnish a check to 
a farmer or rancher as quickly as possible, so most county offices must 
end up delaying or completing the process of all necessary paperwork 
according to required procedures in order to comply with Agency 
procedures as well as satisfy general and specific audits by OIG and/or 
GAO.
    In past years, for example, obligated carryover in fiscal year 1997 
amounted to $63.8 million of which $50.8 million was designated for use 
in fiscal year 1998 and $13 million for use in fiscal year 1999. The 
ending obligated carryover for fiscal year 1998 was actually $32.1 
million which includes the $13 million brought forward from fiscal year 
1998 and programmed for fiscal year 1999. The $32.1 million is for 
carryover workload expenses to be completed in fiscal year 1999. There 
is currently no expected carryover estimate for fiscal year 2000, given 
1999 funding enacted.
    Question. To what extent will the $80 million increase described in 
the fiscal year 2000 budget request actually reflect an increase in 
funding available to a maintain personnel?
    Answer. The increase is actually $40.5 million. The 1999 funding 
level includes the additional $40 million provided by the emergency 
appropriations title of the 1999 Act. This funding identified as 
administrative support for the emergency programs allowed FSA to 
maintain fiscal year 1998 staffing levels into fiscal year 1999. An 
increase of approximately $40.5 million over the fiscal year 1999 
enacted level is required to sustain critical program delivery, 
including pay costs at a reduced staffing level, offset by some 
decreased operating costs. After adjusting fiscal year 1999 for $32.1 
million in obligated carryover funding, the actual net increase for 
fiscal year 2000 amounts to only $8.4 million. Therefore, the small 
increase in total availability actually requires a decrease in staffing 
because of pay and related costs.
    Question. In what manner does the agency expect to reduce the 
staffing levels to those included in the budget documents by the end of 
fiscal year 2000.
    Answer. fiscal year 2000 Explanatory Notes reflect a decrease of 
752 staff years for Federal and non-Federal staffing level, from fiscal 
year 1999 staffing of 16,545 FTE's to fiscal year 2000 staffing level 
of 15,793. FSA has no buyouts or RIF's planned for fiscal year 2000. 
The Agency hopes to achieve the 752 decrease in staff years through 
attrition, which will be difficult.
    Question. What effect will this have on the administration of 
programs and the level of service afforded to customers?
    Answer. Because workload, particularly for marketing assistance 
loans, loan deficiency payments and farm loans, is expected to increase 
in fiscal year 2000, the proposed reduction of 752 staff-years proposed 
will pose a formidable challenge to FSA The Agency will strive for 
maximum efficiency in program delivery as it continues with its 
reengineering efforts for program and administrative services. But 
ultimately, these reductions will negatively impact program delivery in 
terms of delays in delivering payments to farmers, and in implementing 
emergency and disaster programs across the nation, particularly in 
locations already minimally staffed as a result of previous agency 
downsizing.
                   conservation technical assistance
    Question. To what extent will the restrictions on Commodity Credit 
Corporation (CCC) Section 11 reimbursements affect the administration 
of conservation programs in fiscal year 2000? Does USDA plan any 
action, either administratively or through requests to Congress, to 
correct any serious problem posed by the Section 11 limitation?
    Answer. Section 161 of the 1996 farm bill amended Section 11 of the 
CCC Charter Act to limit the uses of CCC funds for reimbursable 
agreements and transfers and allotments of funds to State and Federal 
agencies. In fiscal year 2000, after adjusting the cap to remove the 
Emerging Markets Program from the base, the total expenditure of CCC 
funds for such uses may not exceed $36.2 million. The budget projects 
obligations under the revised cap for reimbursable agreements will 
total $36.2 million in fiscal year 2000, excluding funding for 
technical assistance for the Wetlands Reserve Program (WRP) and the 
Conservation Reserve Program (CRP). Technical assistance needs in 
fiscal year 2000 for the WRP are estimated to total $18.3 million, with 
$2.0 million provided from unobligated prior year appropriations and 
$9.8 million from funds available under the Section 11 cap, leaving a 
shortfall of $6.5 million. Technical assistance needs in fiscal year 
2000 for the CRP are estimated to total $18.1 million. However, no 
funds for CRP technical assistance in fiscal year 2000 are available 
from unobligated prior year appropriations, no CCC funding has been 
provided for, and we are therefore attempting to determine appropriate 
actions to resolve the funding shortfall.
                         food gleaning savings
    Question. As efforts at Food Gleaning become more successful, will 
there by any anticipated future savings for USDA feeding programs? If 
so, when might these be realized and to what levels might they reach?
    Answer. Gleaning provides America the opportunity to save, and to 
provide to low income people, huge quantities of food that would 
otherwise go to waste. While it is reasonable to anticipate that, 
overall, this could affect demand for Federally funded nutrition 
assistance, we anticipate that the effects will be small and very much 
at the margins. Mostly the gleaning effort will help people who don't 
otherwise get enough to eat, some of whom are program participants, and 
many who are not. However, gleaning in no way is seen as supplanting, 
even partially, the need for the Nation's nutrition safety net. It will 
augment it. It will reduce waste and augment nutrition assistance at 
very little cost compared to the value of the food that can be saved 
for human consumption.
           usda agricultural policy advisory committee (apac)
    Question. Please provide an update on the status of nominations to 
the USDA Agricultural Policy Committee (APAC). Wisconsin has a 
candidate that represents the small and medium-sized family dairies 
that are prevalent in the Midwest. What is the Department's status on 
completing those nominations?
    Answer. We are in the final phases of the review process and 
anticipate the process will be completed by the end of March.
                                 ______
                                 
                 Questions Submitted by Senator Dorgan
                        disaster program sign-up
    Question. Not only do we have a farm program safety net that is not 
working, but our delivery system is also facing serious problems. Sign 
up for the 1998 and multi-year crop disaster assistance programs were 
scheduled to start a week ago Monday (Feb. 1). Last week, it was 
announced that farmers should wait a week before coming in, because our 
county offices didn't have all the materials available to sign farmers 
up. Yesterday, I was informed that our farmers would have to wait 
another week until a computer download could be completed. We have also 
had a serious backlog in processing of farm credit applications.
    While I recognize that FSA staff has been working extremely hard to 
get disaster aid to our farmers, the fact is that there has not been 
adequate staffing to effectively deliver the programs on a timely basis 
to our producers. This is a critical time for our farmers. They are in 
the midst of arranging financing for this year's crops. For many, the 
disaster payments will make the difference between whether they are 
able to farm this spring. Yet, the proposed budget is still 
recommending a reduction in FSA staffing. What is the Department's 
future plans so that farmers can be assured that they will receive 
timely delivery of USDA service through FSA?
    Answer. FSA county staffing has declined by 28 percent from 1993 to 
1998 as a result of appropriations actions, field office streamlining 
and workload reductions resulting from the 1996 Farm Bill. The 
emergency funding of $40 million included in the 1999 appropriations 
act has allowed FSA to maintain approximately the same staffing level 
in 1999 as in 1998. However, it did not provide for any additional 
staff to handle the large workload increases associated with the new 
emergency disaster assistance programs. The additional programs have 
strained FSA delivery in many States. This has compounded backlogs 
associated with the increased activity in the loan deficiency payments, 
marketing loan assistance, other assistance activities stemming from 
low prices, and the disbursement of disaster payments.
    The proposed fiscal year 2000 staff reductions may affect program 
delivery and service to producers, particularly in locations already 
minimally staffed as a result of previous agency downsizing. Without 
significant improvement in commodity prices, these proposed staffing 
reductions may not be consistent with the economic realities we are 
facing and the resultant workload. We will be reassessing our needs in 
order to deliver assistance to farmers timely.
                         farm credit assistance
    Question. Yesterday, Vice-President Gore announced that a Federal 
rule change would be issued later this week to streamline the 
procedures for the handling of guaranteed farm ownership and operating 
loans. This is welcomed news. But, a streamlined process doesn't help 
when the program is out of funds. In North Dakota, the allocations for 
a number of categories of guaranteed FSA loans are already fully used. 
What additional amounts of FSA credit will be needed to meet the needs 
for this spring and when will USDA submit such requests to Congress?
    Answer. FSA intends to pool and redistribute unused funds in March 
for the guaranteed operating with interest assistance and farm 
ownership loan programs. This action will help alleviate, but not 
eliminate, funding shortages in North Dakota. The option of seeking 
additional farm loan funding authority from Congress is under review.
    Question. In addition, what changes would you recommend to current 
FSA credit authorities so that you can provide appropriated credit to 
serve the needs of family farmers in this period of distress?
    Answer. FSA is confident that existing loan programs, if fully 
funded, will meet the needs of family farmers affected by low commodity 
prices. FSA farm loans provide low-interest rate assistance in the 
direct and guaranteed operating with interest assistance programs. 
Lenders are able to restructure the indebtedness of their customers 
with FSA guaranteed operating and farm ownership loans.
                          flooded lands relief
    Question. Last year, you announced a $12 million program under the 
Disaster Reserve Assistance Program to assist livestock producers who 
experienced flooding due to natural disasters. In addition, $35 million 
was allocated for flooded agricultural lands as part of the $2.4 
billion disaster assistance package. These programs are urgently needed 
in our region, particularly in the Devils Lake area which has suffered 
for the past six years with flooding. When will USDA have these 
programs ready so that farmers can begin signing up for them and 
receiving assistance from them?
    Answer. The regulation is currently going through departmental 
clearance. Immediately upon OMB clearance and publication in the 
Federal Register signup will begin. We have been working with the 
impacted states to determine the length of signup needed. Input from 
the states indicates that a six week signup period is needed. Data will 
be uploaded to determine a factor and issue payments.
                         fsa budget priorities
    Question. At a time when FSA is having difficulty maintaining 
adequate staff and county offices to deliver farm programs to our 
farmers, I am greatly concerned about the Agency's priorities. While I 
do not oppose the co-location of USDA state offices, I am greatly 
concerned that our FSA state office may be required to move its office 
to Bismarck with moving costs estimated at almost $1 million. In 
addition, since there is not adequate space in the current federal 
building in Bismarck in which USDA offices are currently housed, it 
would also mean the construction of a new facility. Based on projected 
costs savings, it would take almost a dozen years for FSA to recover 
enough in savings to pay for this move.
    At a time when FSA is seriously behind in its workload and has been 
cutting staff at the county level in recent years, it would make more 
sense to use existing funds for providing direct service to producers, 
rather than moving offices. I would request that the Department conduct 
a thorough review of this proposed move and report its findings to this 
subcommittee prior to taking any further action on this matter.
    Answer. As part of the 1994 reorganization, the Department of 
Agriculture has been consolidating administrative organizations that 
provide support to program managers. Currently three separate 
administrative structures provide support to the Natural Resources 
Conservation Service, and the Farm and Foreign Agriculture Services and 
Rural Development mission areas--down from nine such organizations in 
1993. The Department has combined these three structures into one unit 
which will be known as the Support Services Bureau, and by delegating 
the authority to conduct most administrative functions to the state 
level, closer to the customer.
    This action was implemented due to the following reasons:
  --A consolidated structure will deliver better services to our local 
        customers and employees.
  --A consolidated structure will provide for a new consistency in 
        administrative policy.
  --A consolidated structure will make better use of limited 
        administrative resources.
  --A more efficient administrative structure will help to preserve 
        limited budget resources for program delivery.
    The proposal to consolidate the Bismark FSA State Office with the 
other agencies is part of this plan. FSA, NRCS, and RD will be 
establishing a working group comprised of representatives from 
management and the unions to develop a plan for implementing the 
administrative convergence. The working group will be looking at every 
aspect of the plan to achieve savings under current budget 
circumstances, but will certainly take into consideration the balancing 
of moving costs necessary to achieve the convergence plan with any 
diminished service level to producers. We will advise the subcommittee 
prior to consolidating the offices at Bismarck.
                     trade & policy research center
    Question. USDA's budget for fiscal year 2000 includes funding for 
the Trade and Policy Research Center at North Dakota State University. 
The budget states that the project will contribute primarily to the 
Department's Strategic Goal 1, ``An agricultural production system that 
is highly competitive in the global economy,'' and Goal 5, ``Enhanced 
economic opportunities and quality of life for families and 
communities.'' Please provide for the record a statement on the longer-
term need for the research and analysis which will be provided by the 
Trade and Policy Research Center for the Northern Plains Region, and 
how this would complement and supplement research conducted by the Food 
and Agricultural Policy Research Institute (FAPRI).
    Answer. The Northern Plains Policy and Trade Research Center 
(NPPTRC) at North Dakota State University has been a member of the Food 
and Agricultural Policy Research Institute (FAPRI) consortium for 
several years and provided important analytical input that is unique to 
the large northern plains region of the United States. Most other 
consortium members receive federal funding for the work they do on 
behalf of several states in their respective regions while NPPTRC has 
been representing the northern plains states primarily with its own 
resources. The proposed research project will greatly enhance the 
quality of policy and trade research in the northern plains and improve 
the FAPRI agricultural forecasts. The NPPTRC global wheat model and 
global sugar model currently interact with the FAPRI model in 
evaluating agricultural outlook for wheat and sugar. The proposed 
program will enhance the quality of these models as well as develop new 
analytical tools that capture the unique resource endowment, climate, 
crop mix, and marketing environment of the northern plains and provide 
timely analyses of major trade issues and policy changes for private 
and public decision makers.
                              usda epscor
    Question. Congress for a number of years has directed USDA to use 
10 percent of its National Research Initiative Competitive Grants 
Program (NRI) funding for an Experimental Program to Stimulate 
Competitive Research (EPSCoR). USDA EPSCoR strengthens our nation's 
research capability and helps ensure that quality research in the 
agricultural sciences is a nationwide commitment. Using the three most 
recent years for which data is available, what percentage of NRI 
funding was committed to researchers in the USDA-EPSCoR States?
    Answer. The percentage of NRI funding committed to researchers in 
the USDA-EPSCoR states for the three most recent years for which data 
are available is as follows: 1996 = 12.7 percent; 1997 = 12.6 percent; 
1998 = 15.2 percent.
    Question. Please provide a chart listing, by state, the number of 
proposals submitted to each of the four USDA EPSCoR award areas 
(Research Career Enhancement Awards, Equipment Grants, Seed Grants and 
Strengthening Standard Project Awards), and the number of those 
proposals which received funding.
    Answer. The number of proposals submitted by and awards made to 
USDA-EPSCoR states in the NRI Research Career Enhancement Awards, 
Equipment Grants, Seed Grants and Strengthening Standard Project Awards 
programs are as follows:

                             NATIONAL RESEARCH INITIATIVE COMPETITIVE GRANTS PROGRAM
----------------------------------------------------------------------------------------------------------------
                                Research Career      Equipment Grants       Seed Grants         Strengthening
                               Enhancement Awards ------------------------------------------  Standard Research
            State            ---------------------                                              Project Awards
                                                   Proposals   Awards   Proposals   Awards  --------------------
                              Proposals   Awards                                             Proposals   Awards
----------------------------------------------------------------------------------------------------------------
 
      Fiscal year 1996
 
Alaska......................  .........  ........  .........  ........  .........  ........          3  ........
American Samoa..............  .........  ........  .........  ........  .........  ........  .........  ........
Arkansas....................  .........  ........          2         2          5         1         11         5
Connecticut.................  .........  ........          1         1          3         3         11         2
Delaware....................  .........  ........  .........  ........  .........  ........         10         3
District of Columbia........  .........  ........  .........  ........  .........  ........          1  ........
Guam........................  .........  ........  .........  ........  .........  ........  .........  ........
Hawaii......................  .........  ........  .........  ........  .........  ........          2  ........
Idaho.......................  .........  ........          2         2          3         3         17         4
Maine.......................          1  ........          1  ........          3         1          9         1
Micronesia..................  .........  ........  .........  ........  .........  ........  .........  ........
Mississippi.................  .........  ........          3         2          5         1         11         3
Montana.....................          1         1          3         1          5  ........         13         5
Nevada......................  .........  ........  .........  ........          1  ........          5  ........
New Hampshire...............          1  ........  .........  ........          3         1          5         2
New Mexico..................  .........  ........          3         2          1  ........          5  ........
North Dakota................  .........  ........          5  ........          5         2          8         3
Northern Marianas...........  .........  ........  .........  ........  .........  ........  .........  ........
Puerto Rico.................  .........  ........  .........  ........          2  ........  .........  ........
Rhode Island................  .........  ........          6         4          7  ........          7  ........
South Carolina..............  .........  ........          1         1         10         3         13         2
West Virginia...............  .........  ........  .........  ........          3  ........          9         2
Wyoming.....................  .........  ........          1  ........          5         1          5         1
 
      Fiscal year 1997
 
Alaska......................  .........  ........  .........  ........          1  ........          3  ........
American Samoa..............  .........  ........  .........  ........  .........  ........  .........  ........
Arkansas....................  .........  ........          4         4          8         3          9         3
Connecticut.................  .........  ........          1         1          2         1          9         1
Delaware....................  .........  ........          1         1          1  ........          4  ........
District of Columbia........  .........  ........  .........  ........          2         1  .........  ........
Guam........................          1  ........  .........  ........  .........  ........  .........  ........
Hawaii......................          1         1  .........  ........          2         1          4  ........
Idaho.......................  .........  ........          1  ........          1  ........          6  ........
Maine.......................  .........  ........          1         1          6         3          7         3
Micronesia..................  .........  ........  .........  ........  .........  ........  .........  ........
Mississippi.................  .........  ........          2         1          5         2         11         1
Montana.....................  .........  ........          4         4         12         3          1  ........
Nevada......................  .........  ........          1         1  .........  ........          8         2
New Hampshire...............  .........  ........  .........  ........          3         1          1  ........
New Mexico..................  .........  ........          1         1  .........  ........          3  ........
North Dakota................          1         1          5         4          3  ........          7         1
----------------------------------------------------------------------------------------------------------------

                                 ______
                                 
                Questions Submitted by Senator Feinstein
                             citrus freeze
    Question. How are the fiscal year 1999 Disaster Supplemental funds 
being allocated?
    Answer. Producers who suffered losses to their 1998 crops and their 
1999 crops for which harvest began in December, 1998 are provided the 
option of receiving single year loss benefits on either their 1998 or 
1999 crop, but not both. To determine multi-year benefits, the 1998 
crop insurance indemnities will be used to determine eligibility.
    Question. Will there be sufficient funding to cover the additional 
cost imposed on the funding by the citrus freeze?
    Answer. The 1999 Appropriations Act, Public Law 105-277, provided a 
total of $2.375 billion for crop loss disaster assistance. If the value 
of applications received ultimately exceeds available funds, then 
payments to producers would need to be prorated.
    Question. Unlike other farm workers, California's citrus workers 
are permanent residents in the areas where they work. What steps can 
the USDA take to address the needs of California's farm workers who 
lost their only source of income due to the freeze?
    Answer. To date, The Department has made available $1.8 million for 
emergency rental housing for farm workers displaced due to the December 
freeze. The Department is reviewing a range of possible options which 
could be used to assist farm workers affected by the citrus freeze. 
This includes review of funding options within the Rural Development 
area as well as existing legislative authorities. For example, Section 
2281 of the Food, Agriculture, Conservation and Trade Act of 1990 
authorizes up to $20 million annually in emergency grants to public 
agencies or private organizations with tax exempt status to assist 
seasonal farmworkers that have lost income due to natural disasters, 
however, no funds are currently available under this authority. In 
1992, following Hurricane Andrew, use of Commodity Credit Corporation 
funds was authorized in emergency supplemental legislation for farm 
worker housing in south Florida. The funds were used to purchase and 
install trailers.
                          freeze in california
    Question. Are you planning to extend the same waivers relating to 
food stamps that were granted to Tulare County to the other counties 
impacted by the freeze?
    Answer. Tulare and Fresno County have requested certain waivers and 
they were provided. The California State Agency has advised the other 
disaster affected counties that waivers are available, but the counties 
have not requested any at this point.
    We have shipped about 40 extra truckloads of food into these 
counties, to date, coming from State and Federal inventories. And we 
are keeping a close eye on developments there to make sure we do all 
that we can.
                           border inspections
    Question. What steps are you taking to address the recent fruit fly 
and pest infestation problems at the border in San Diego and other 
ports of entry?
    Answer. USDA and the California Department of Food and Agriculture 
(CDFA) are working cooperatively on three Mediterranean fruit fly 
(Medfly) and Mexican fruit fly (MFF) emergency eradication programs in 
California. The Medfly operations are located in Orange, San Diego and 
Riverside Counties. The MFF operations are in several areas of San 
Diego County such as El Cajon, Oak Park and Stockton. All emergency 
efforts include regulatory activities, pest control, and surveys. In 
addition, an areawide sterile MFF release program was implemented in 
January 1999 to prevent outbreaks due to natural or illegal movement of 
the exotic insect. The release area encompasses the three infested 
areas and most populated areas of San Diego south of Interstate 8 to 
the US/Mexican border. We plan to continue the areawide release program 
until June, 1999.
    Question. Reports have indicated that the actual staffing levels at 
the border are well below what are recommended in agency guidelines for 
USDA inspections. How many inspectors are currently working at the 
major California points of entry?
    Answer. There are currently 65 authorized positions at the major 
California points of entry: Calexico, CA (22); Andrade, CA (2); and San 
Diego, CA (41).
    Question. How many inspectors are recommended by USDA guidelines?
    Answer. The USDA guidelines for fiscal year 1999 recommend 65 
inspector positions at major California points of entry.
    Question. The fiscal year 2000 budget requests an increase in the 
AQI program. Will any of this increase will go towards correcting the 
staffing shortage at the US/Mexico border?
    Answer. The proposed fiscal year 2000 increase for the AQI 
appropriated program supports additional staffing of 15 inspectors 
along the US/Mexican border. We plan to allocate 3 of the new positions 
at California points of entry: Andrade, CA (2) and San Diego, CA (1). 
The balance of the positions will be located along the Mexican border 
in Arizona and Texas.
    Question. How much additional funding is necessary to bring the 
number of inspectors up to USDA standards?
    Answer. The proposed fiscal year 2000 increase of $3.9 million for 
the AQI appropriated supports additional inspection personnel necessary 
to address the expansion of travel and trade from Mexico, Canada and 
Hawaii.
    Question. How will USDA address the concerns raised by nations such 
as Australia and Taiwan which have imposed restrictions on importing 
some agricultural products from the San Diego area?
    Answer. USDA is conducting bilateral negotiations to assure these 
countries that our emergency programs in San Diego, California, 
including all regulatory, control, and survey efforts, are more than 
sufficient to guarantee that agricultural products from this area pose 
no pest risk. In addition, we invited Taiwanese and Australian 
agricultural officials to visit the emergency project sites to 
experience the scope and intensity of these programs first-hand. On an 
ongoing basis, we ensure compliance with all international standards 
for activities like pest surveillance and notification to promote the 
credibility of U.S. agricultural products among our various trading 
partners.
                  importation of citrus from argentina
    Question. How is USDA planning to address the concerns raised by 
the California Department of Food and Agriculture relating to 
importation of citrus products from Argentina, particularly the 
problems they raise with citrus black spot and sweet orange scab?
    Answer. On October 16, 1998 APHIS extended the public comment 
period until February 11, 1999. Public hearings were conducted also in 
Orlando, Florida and Thousand Oaks, California. APHIS is now analyzing 
the information provided by independent scientists regarding the 
Argentine petition and the risk mitigation measures advocated by APHIS. 
It is our intent that these mitigation measures are designed to prevent 
the introduction into the United States of Citrus Canker, sweet orange 
scab and citrus black spot.
    Question. What is the time line for implementing the rule on 
importing Argentine citrus?
    Answer. We hope to complete our analysis in time for the 
regulations to be in place for their next crop season.
    Question. Does APHIS require additional resources to address this 
problem?
    Answer. No additional funds are needed to complete this analysis.
                                 ______
                                 
                 Questions Submitted by Senator Durbin
                         agricultural research
    Question. Will the amount included for the National Center in the 
Budget preclude an expeditious completion of this project?
    Answer. The amount included in the fiscal year 2000 budget for the 
National Center for Agricultural Utilization Research (NCAUR) will not 
preclude an expeditious completion of the North Wing project. The $8.2 
million received in fiscal year 1999 will be used for design and 
construction of the last phase of the North Wing renovation. In the 
fiscal year 2000 budget, $1.8 million will be needed for planning and 
design of the Chemical Wing renovation. Planning and design is expected 
to last 12-18 months. Construction funds for the Chemical Wing 
renovation will not be needed until fiscal year 2001.
    Question. What criteria was used to determine ARS program cuts at 
facilities like the National Center in Peoria and the University of 
Illinois at Urbana-Champaign? In particular, please account for the 
cuts in the following programs at the University of Illinois: Soybean 
Diseases; Sensors and Systems for Site-Specific Crop Management to 
Improve Environmental Quality; and Reduced Herbicide Inputs for 
Effective Weed Management Systems to Improve Water Quality. And, the 
following programs at the National Center in Peoria: Processing of 
Natural Polymers; Enhanced Uses of Plant Proteins; Anaerobic Processes 
in Animal Waste Management; Meadowfoam Research; Bioprocess and 
Metabolic Engineering Technologies for Biofuels; Biotechnology Research 
and Development Corporation; and Novel Carbohydrate-Based Materials via 
Bio Conversion Processes.
    Answer. The research projects carried out at the Peoria and Urbana 
research centers are recognized as important research to the Department 
and the specific groups, producers and consumers who would benefit from 
this research. However, these projects have been identified as being 
less critical to the Nation's broader interests and research needs, 
such as food safety research, nutrition research, and global climate 
change. The screening criteria used by ARS officials includes the 
following elements: the relevance of the research project; the 
availability of sufficient resources to conduct the research; and the 
overall impact of research on American agriculture. The projects are 
numerically ranked according these criteria, and those with the lower 
rankings are proposed for termination.
    Most of the projects proposed for termination in this budget at 
Peoria and Urbana were identified in prior Administration budgets as 
less critical and remain in this category. Newly initiated projects not 
included in the President's requests were also added to the proposed 
termination list. While these research projects are important, 
worthwhile, and provide benefits to the agricultural industry and the 
American public, others of more critical national importance become 
higher priority.
    The funding allocation for discretionary programs in the fiscal 
year 2000 budget remains exceedingly tight. Choices between better and 
best are never easy but constraints in this budget made this a 
necessary process. Let me reiterate that those projects recommended for 
termination have or will contribute to the solution of agricultural and 
consumer problems--but they are considered less essential to continue 
because of a very constrained discretionary Federal budget with 
competing, higher priority research needs.
                              food safety
    Question. The President stated in early January that of the $105 
million increase for the Food Safety Initiative, approximately $65 
million would go to USDA. The President indicated that portions of 
these funds would be used to ``introduce HACCP at the 2,700 smaller 
plants.'' My understanding is that those plants came on line in 
January, 1999. How will funds in fiscal year 2000 be used for the above 
mentioned plants?
    Answer. In January, small meat and poultry establishments were 
required to have implemented Hazard Analysis and Critical Control Point 
(HACCP) systems. In order to facilitate this transition, we held 
numerous workshops across the country to provide the operators of these 
establishments with the technical assistance needed to meet the new 
requirements. The 2000 budget will provide the resources necessary to 
maintain these efforts.
    Question. How will FSIS funds be used to assist with the 
``smallest'' plants (those employing less than 11) with HACCP 
implementation in January 2000?
    Answer. The 2000 budget includes resources necessary for the Food 
Safety and Inspection Service (FSIS) to ensure that very small 
establishments have the technical assistance needed to successfully 
implement Hazard Analysis and Critical Control Point (HACCP) systems. 
In addition, funds are requested to redeploy inspection personnel to 
cover critical inspection vacancies in very small establishments. The 
2000 budget also includes funding for initiatives aimed at ensuring 
that State meat and poultry inspection programs have the capability to 
implement the HACCP rule. Successful implementation by the States is 
important, because they inspect approximately 3,000 very small 
establishments.
    Question. In moving towards more ``science-based'' approaches to 
food safety inspection, FSIS is proposing changes in the way it uses 
its inspectors. Has FSIS formed a new interpretation of ``continuous 
inspection'' and is there a need for a change in Statutory authority?
    Answer. The Food Safety and Inspection Service (FSIS)is beginning 
to test alternative slaughter inspection procedures in conjunction with 
the implementation of the Hazard Analysis and Critical Control Point 
(HACCP) systems regulations. As part of these tests, FSIS personnel 
will conduct inspection in different ways, but with the same goal of 
ensuring the safety of all meat and poultry products. This does not 
connote a new interpretation of continuous inspection. The existing 
statutory framework for meat and poultry inspection provides FSIS with 
ample authority and flexibility to build a science-based regulatory 
system based on these alternatives.
                        asian longhorned beetles
    Question. The Administration, USDA in particular, has responded 
expeditiously and thoroughly in its efforts to combat the infestation 
of the Asian Longhorned Beetle in the Chicago, Illinois area. Please 
provide a status report on the efforts taking place in Chicago to 
combat infestation as well as remove and replant trees. Is there a 
coordinated approach with other Federal departments and agencies?
    Answer. In July and August of 1998, Asian Long-Horned Beetle was 
discovered at three locations in the Chicago, Illinois area. Over 400 
trees have been found to be infested and scheduled for removal. This 
program is a cooperative effort between APHIS, the Illinois State 
Department of Agriculture, and the city of Chicago.
    Question. What Federal funds are available to assist the City of 
Chicago, the State of Illinois, and other affected communities?
    Answer. In January 1999, $5.5 million was transferred to APHIS from 
the Commodity Credit Corporation to conduct eradication activities in 
New York and Illinois.

                          SUBCOMMITTEE RECESS

    Senator Cochran. Our next hearing is going to be Tuesday, 
March 2nd, at 9:30 a.m. in this room, 138 of the Dirksen Senate 
Office Building. At that time we will hear from Department of 
Agriculture witnesses on the subject of assistance to producers 
and the farm economy.
    Until then, we stand in recess.
    [Whereupon, at 11:25 a.m., Tuesday, February 9, the 
subcommittee was recessed, to reconvene at 9:30 a.m., Tuesday, 
March 2.]


AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

                              ----------                              


                         TUESDAY, MARCH 2, 1999

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9:34 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Thad Cochran (chairman) presiding.
    Present: Senators Cochran, Gorton, Burns, Kohl, Dorgan, and 
Durbin.

                       DEPARTMENT OF AGRICULTURE

       Under Secretary for Farm and Foreign Agricultural Services

STATEMENTS OF:
        KEITH COLLINS, CHIEF ECONOMIST
        AUGUST SCHUMACHER, JR., UNDER SECRETARY FOR FARM AND FOREIGN 
            AGRICULTURAL SERVICES
ACCOMPANIED BY DENNIS KAPLAN, DEPUTY DIRECTOR, OFFICE OF BUDGET AND 
            PROGRAM ANALYSIS

                            OPENING REMARKS

    Senator Cochran. The subcommittee will please come to 
order.
    We welcome our witnesses and our guests at our hearing 
today.
    At this hearing, we will review the budget request for the 
Department of Agriculture for programs administered by the 
Department which provide assistance to farmers and ranchers.
    In this context, we need to know and we would like to hear 
from our witnesses about the current financial and economic 
situation confronting farmers, including farm commodity prices 
and what the Department is doing to help expand markets and 
improve farm income.
    We would like to know the status of the emergency 
supplemental funding and livestock and marketing assistance 
payments that were provided for in the Fiscal Year 1999 
Agriculture Appropriations Act and how the Department is 
administering these programs.
    We will also be interested in hearing from our witnesses 
about the adequacy of the funding for credit programs that 
finance farmers' activities.
    Last year, Congress appropriated one of the largest 
emergency farm relief packages in history, providing nearly $6 
billion for disaster and market assistance for the Nation's 
farmers and ranchers. Also, additional production flexibility 
contract payments were disbursed before the first of the year 
to help farmers.
    Those who purchased crop insurance will have a 30 percent 
reduction in premium costs because of this disaster assistance 
legislation.
    We appreciate very much the presence at our hearing this 
morning of Keith Collins, who is the Chief Economist of the 
Department of Agriculture; Mr. August Schumacher, Jr., Under 
Secretary for Farm and Foreign Agricultural Services, and Mr. 
Dennis Kaplan with the Budget Office of the Department of 
Agriculture. There are others who are here accompanying these 
witnesses and we appreciate your being here and providing 
assistance to us at this hearing.
    We have copies of statements that you have prepared and we 
thank you for those. They will be made a part of the record in 
full.
    I would invite you now to proceed to make whatever comments 
you think appropriate and to summarize your statements. We will 
have an opportunity to ask questions after you complete your 
remarks.
    Mr. Collins, you may proceed.

                       STATEMENT OF KEITH COLLINS

    Mr. Collins. Thank you very much, Mr. Chairman, and good 
morning. Thanks for the invitation to start this hearing by 
discussing the economic conditions in U.S. agriculture.
    There is a great deal of concern about the problems the 
farm economy experienced in 1998 and a great deal of concern 
about the prospects for 1999. I am going to start by describing 
briefly the current situation. Then Under Secretary Schumacher 
will follow up by providing some detail on the assistance 
programs that we are providing to U.S. agriculture.
    As we all know, the farm economy contracted in 1998. As you 
indicated, the emergency relief package helped many producers 
cope with the downturn in the farm economy this past year.
    In 1999, unfortunately, farm exports are going to continue 
to be weak and farm prices likewise will continue to be weak. I 
think that will cause higher farm financial stress, 
particularly in some areas of the country that have escaped up 
to this point, notably areas in the Corn Belt and down into the 
mid-South.
    There are two major causes of the downturn that we are now 
experiencing. The first is macroeconomic, the slowdown in the 
world economy which is reducing food and fiber demand. World 
economic growth in 1998 was about half the level of 1996 and 
1997. And, as we look ahead for 1999, it will probably remain 
at that rate, about half the level of the mid-1990's.
    In addition to that, we have had a very sharp increase in 
the value of the dollar which has encouraged imports. It has 
also eroded our competitive position in world markets.
    A second major cause of the downturn is increased world 
agricultural production of food and fiber. To give you an 
example, the 3 highest years of production in world history of 
grains and livestock occurred in the last 3 years. So 
production has been boosted by the high prices that we saw in 
the mid-1990's.
    We have had 3 generally favorable weather years. We have 
had better technology, which is also boosting yields. We have 
also had a livestock liquidation occurring in a number of 
countries around the world, which is increasing meat supplies. 
And we have had key policy changes, such as in China, which has 
promoted self-sufficiency there.
    This combination of large supplies and slow-growing demand 
is driving down farm prices. While the decline that we are 
seeing has all the earmarks of being cyclical, I think there 
are also some underlying structural changes that suggest for 
some commodities, such as soybeans and hogs, that lower prices 
on average may endure into the future.
    In 1996, farm exports reached a record high of $60 billion. 
This year, we are forecasting farm exports at only $49 billion. 
Grain, cotton, oilseed, beef and poultry exports all have been 
seriously affected.
    In addition to that, our trade surplus in agriculture--
something we like to extol--will only be $11 billion this year, 
which would be the lowest level since 1987.
    As a result of this weak export market and decline in 
demand, farm cash receipts last year fell about $10 billion. 
They went down to about $198 billion. And I think as we look 
ahead for 1999, we would foresee them staying at that level, 
although crops would decline a little more, offset by a little 
increase in livestock.
    Despite all this bad news that I have uttered thus far, 
there are some positive factors, I think, that are helping a 
number of farmers withstand the decline, the downturn in the 
farm economy. Declining interest rates, fuel prices, and feed 
costs lowered farm production expenses last year. They fell 2 
percent. That is the first significant decline in about a 
decade.
    In addition to that, farm interest expenses are in pretty 
good shape. I would take you back to the early 1980's when farm 
interest expenses were 14 percent of gross cash income of 
farmers. This past year they were only 6 percent.
    Another factor offsetting the drop in market revenues is 
government payments, which rose $5.5 billion during calendar 
year 1998. They were $13 billion in total, and, I think as we 
look out to 1999, we can see government payments again 
providing good support. They will probably be at least $11 
billion.
    Our conservation programs, those plus technical assistance, 
are also an important part of government support. They provide 
payments; they provide cost sharing to help farmers maintain 
their soil productivity and deal with environmental concerns.
    These aggregate financial measures that I have just 
discussed suggest that the farm economy was generally 
performing financially adequately as we started 1999, mainly 
due to the increase in government payments and the reduction in 
production costs.
    We had the second highest net cash income in history in 
1998, and the farm debt-to-asset ratio has remained steady, at 
about 15 percent, which is well below the 20 percent or more 
that we saw in the 1980's.
    As we look out to 1999, I think the signs point to 
increased financial stress. Net cash farm income is expected to 
decline about $3 billion to $4 billion. While farm real estate 
prices, by most analyst' expectations, are not going to go 
down, we have seen some declines in farm real estate prices in 
some regions of the country in the second half of 1998.
    I think many producers will have a greater difficulty 
obtaining credit in 1999. You may have seen the Farm Credit 
System's report this week that their nonperforming loans rose 
69 percent during 1998. They were a big lender to American 
agriculture. But I would point out that the share of 
nonperforming loans for the Farm Credit System as well as other 
banks is still pretty small in their total portfolio.
    More people are turning to USDA for credit. Our farm loan 
commitments since October are up 65 percent over the year 
earlier.
    Very quickly, let me just comment on a couple of the 
commodity market situations.
    For grains, the current season is one of building stocks. 
Prices this year for the 1998 crops are at 8- to 10-year lows.
    I think when we look at grains, the bottom may be near. For 
wheat, we are going to see less acreage, as low prices combined 
with planting flexibility will take acreage out of grains, I 
believe, in 1999. That should reduce wheat stocks. It should 
stabilize corn stocks. We might see improved prices for wheat, 
but not very much because there is still going to be a lot of 
wheat in the world--maybe a 10-percent increase in prices on 
the 1999 crop.
    For corn, unfortunately, with stocks stabilizing, prices 
are staying about the same, in the $2 per bushel range.
    For soybeans, I think carryover stocks this season will 
reach the highest level in more than a decade. Our soybean 
prices will be the lowest since 1986, and I do not have good 
news to report for 1999.
    I think we will see a further increase in stocks and even 
lower prices. Soybeans are attractive to many farmers because 
they represent a little bit less risky crop. Soybeans have been 
resilient in bad weather. They have low out-of-pocket costs, 
compared to some of the other main crops. Soybeans' marketing 
assistance loan is a little bit higher relative to some of the 
other crops, and we have new varieties, such as herbicide 
resistant soybeans.
    All of those factors I think will push more plantings of 
soybeans in 1999, and we could see the season average price 
drop well below $5 a bushel.
    For cotton, this year's exports are the second lowest in 20 
years due to reduced world demand for cotton textiles and 
apparel. Also, our cotton production is much lower, and we have 
a lot of polyester on the world market. Since there are very 
low oil prices, there are low polyester prices. And we lost 
Step 2 payments.
    In addition to that, we have a surge in imported cotton 
textiles in the United States and that has hurt domestic mill 
demand for cotton.
    In 1999, I think we will see higher U.S. production, and 
that will continue to keep the pressure on cotton prices.
    Turning to livestock, we had record meat and poultry 
supplies in 1998. That gave us the lowest cattle prices in the 
1990's, and it gave us the lowest hog prices since 1972.
    While our cattle herd has been reacting to low prices for 
some years and declining since late 1995, and we think that in 
1999 we will see lower beef production, the low prices will 
also probably reduce hog production in 1999, and we will see 
strengthening prices for both of those commodities, but not big 
increases. Increases will probably be on the order of 5 percent 
to 10 percent--better, but still weak, prices.
    As beef and pork production is cut back, I think broiler 
production will be up fairly sharply, given last year's high 
prices, and that will contribute to yet another year of record 
high meat and poultry supplies in 1999.
    Milk prices were good news in 1998. We had record high milk 
prices. Unfortunately, over the last several months, we have 
seen a big increase in milk production, and that has led to a 
sharp drop in cheese prices.
    On Friday of this week, we will announce the basic formula 
price for February, and I think it is likely to be down in the 
neighborhood of 35 percent from January's price. That would be 
a record large month-to-month drop. But I would point out that 
it would be coming from a very high level. The January price 
was the second highest in history.
    For all of 1999, farm level milk prices will probably 
average between the 1997 and 1998 levels. Unfortunately, prices 
have recently been weaker than we thought, and it looks like 
they will be closer to the 1997 levels, which was not a good 
year for dairy producers.
    Producers will have some offsets to the lower milk prices, 
however, from lower feed costs and from the $200 million in 
relief payments to be made soon.
    To conclude, there are sectors in agriculture that are 
stable and growing. However, there are some that are not. For 
1999, field crops will be in the category where producers are 
likely to face increased financial stress.
    As I indicated, red meat markets will get stronger, but 
they will still be weak. I think that these types of forecasts 
suggest that the financial difficulties that we saw in some 
producers in the Southern Plains States, some areas in the 
Southeast, and some areas in the Northern Plains are going to 
spread into the Midwest and down further into the Delta States 
in 1999.
    I would end by saying there are lots of uncertainties when 
economists talk about the future--the weather being one, the 
macroeconomic performance of the world economy being another, 
and the policies of countries around the world being yet 
another one.
    But I do want to emphasize that there are a lot of cyclical 
factors at play in agriculture right now. So, as we look out 
over the next 2 to 4 years, some of those things will correct. 
The world economy will start to grow better, and I think at 
that point we will see stronger export demand and better prices 
for U.S. farmers.
    At this point, however, I would say the recovery looks like 
it would occur at a fairly gradual pace.
    That completes my comments, and I will turn it over now to 
Mr. Schumacher.
    [statement follows:]
                  Prepared Statement of Keith Collins
    Mr. Chairman and members of the Committee, I welcome the 
opportunity to discuss the economic outlook for U.S. agriculture. Over 
the past year, the near-term outlook changed dramatically as adverse 
weather reduced farm income in some regions, and the Asian financial 
crisis and large global commodity production caused a sharp drop in 
farm prices and the value of agricultural exports. With crop yields at 
trend levels in 1999, major crop prices will likely remain at low 
levels over the next year, and record total meat and poultry production 
is likely to prevent a strong rebound in livestock prices. Increased 
government assistance enacted in 1998, of nearly $6 billion, is helping 
to maintain farm income and limiting financial hardship in the near 
term. But with weak exports and prices in 1999, farm financial stress 
is likely to rise. Over a 2- to 4-year horizon, economic recession in a 
number of countries should give way to economic recovery, increased 
demand for U.S. agricultural products, and a gradual improvement in 
farm prices and incomes.
                         macroeconomic overview
    In 1996 and 1997, positive economic growth in the United States, 
near record indicators of consumer confidence, and the lowest 
unemployment rate since 1973 bolstered domestic demand for agricultural 
products, while an expanding world economy and declining barriers to 
trade supported expansion in U.S. agricultural exports. In 1998, the 
U.S. economy remained strong, but the foundation for world food demand 
deteriorated, as Japan, South Korea, Malaysia, Philippines, Thailand, 
Indonesia, Russia, Saudi Arabia, and Brazil all saw their economies 
contract. After rising an estimated 3.4 percent in 1997, the world 
economy grew only 1.9 percent in 1998, the lowest rate of growth in 5 
years.
    World economic growth is likely to slip a little more in 1999, 
growing only about 1.7 percent. The U.S. economy may slow as a 
strengthening dollar further increases the U.S. trade deficit, but 
inflation, interest rates, and unemployment remain at low levels. Most 
analysts do not expect Southeast Asia's economies to turn around until 
2000, but recessionary pressures are expected to weaken in 1999, with 
Japan's economy bottoming out and South Korea poised for recovery. 
However, economic growth will likely slow in Latin America, pulled down 
by Brazil's currency crisis. And, the Russian economy will decline 
sharply in 1999.
                 outlook for u.s. agricultural exports
    Lower world market prices and export volume reduced U.S. 
agricultural exports to $53.6 billion in fiscal year 1998, 10 percent 
below fiscal year 1996's record-high $59.8 billion. For fiscal year 
1999, the U.S. Department of Agriculture (USDA) forecasts exports to 
drop to $49 billion, as lower export prices more than offset increased 
volume. Lower world prices and reduced volume will likely cut the value 
of oilseed and product exports by almost $3.5 billion. In addition, low 
supplies and reduced competitiveness will lower cotton exports, and the 
Russian financial crisis is forecast to lower poultry exports. Reduced 
exports to Asia account for about 85 percent of the drop in the value 
of U.S. agricultural exports during fiscal year 1996-99.
    Pacific Asia, including Japan, South Korea, and Taiwan, is the most 
important market for U.S. agricultural products, accounting for one-
third of total U.S. agricultural export sales this past year. Over the 
coming decade, rapid income growth in Pacific Asia will stimulate 
expansion in demand for U.S. farm products. Other important growth 
markets include our North American Free Trade Agreement (NAFTA) 
partners, Canada and Mexico. In fiscal year 1998, these two countries 
imported nearly $13 billion in U.S. agricultural products accounting 
for nearly one-quarter of all U.S. agricultural exports.
    Generally, USDA does not expect Brazil's economic problems, if 
contained, to lower greatly U.S. agricultural exports. In fiscal year 
1998, Brazil was the 2lst largest market for U.S. agricultural exports, 
importing $0.6 billion in U.S. agricultural products or only about 1 
percent of total U.S. agricultural exports to all destinations. 
However, for some commodities, such as rice, Brazil is a very important 
market. In fiscal year 1998, rice exports to Brazil amounted to nearly 
one-fifth of total U.S. rice exports. USDA forecasts a drop in U.S. 
agricultural exports to Brazil to $0.5 billion in fiscal year 1999.
    Brazil is slightly more important as a source of U.S. agricultural 
imports, ranking as the 8th largest U.S. agricultural import supplier. 
Brazil accounts for over one-half of U.S. orange juice imports. Other 
agricultural imports from Brazil include prepared and preserved beef or 
veal, sugar, coffee and tobacco. In addition, Brazil is a major U.S. 
competitor in the soybean market.
   an overall assessment from the farm income and finance perspective
    Cash Receipts and Expenses.--With strong demand and record or near-
record market prices for several crops, farm crop cash receipts reached 
a record $112 billion in 1997. Lower crop prices caused crop cash 
receipts to fall to less than $105 billion last year. For 1999, USDA 
projects cash receipts for crops will likely decline to $102 billion, 
$10 billion below the record and the lowest level in 4 years, as crop 
prices retreat further. Compared with 1997, corn cash receipts may be 
down by over $4 billion, wheat cash receipts down by over $2 billion, 
and soybean cash receipts down by nearly $4 billion in 1999.
    Livestock receipts reached nearly $97 billion in 1997. Livestock 
receipts declined by about $3 billion last year, as record high prices 
and receipts for milk were more than offset by sharply lower prices and 
reduced receipts for cattle and hogs. This year, lower red meat 
production will likely lead to higher prices and receipts for cattle 
and hogs, while poultry receipts remain about the same and more milk 
production reduces prices and receipts for milk. Total livestock 
receipts will likely improve in 1999, as the increase in cattle and hog 
receipts more than offset lower milk receipts.
    Declining interest rates, fuel prices, and feed costs have helped 
farmers reduce their production costs, offsetting some of the decline 
in cash receipts. Total production expenses declined 2 percent from 
1997 to 1998, the first significant drop in more than a decade. In 
1999, USDA forecasts total farm expenses to be $186 billion, up only 
slightly from last year.
    Government Payments.--Legislation passed last year along with 
provisions of the Federal Agriculture Improvement and Reform Act of 
1996 (the 1996 Act) are helping to offset much of the loss in farm 
income resulting from crop losses and lower crop prices. USDA's 
Economic Research Service (ERS) estimates direct government payments, 
which do not include net indemnity payments under the Federal crop 
insurance program, to farmers reached nearly $13 billion in calendar 
1998 and will total about $11 billion in 1999, up from $7.5 billion in 
1997. For the 1990's, government payments exceeded these levels only in 
1993, when payments reached $13.4 billion.
    In October, Congress passed and the President signed legislation 
providing about $5.7 billion in additional direct payments to farmers. 
Nearly $2.9 billion of these payments were paid out as additional 
Production Flexibility Contract (PFC) payments in late 1998. USDA will 
distribute the remaining payments during the first half of 1999, with 
the bulk going to crop producers who suffered 1998 and prior-year crop 
losses. Congress also passed legislation last year enabling producers 
to receive 100 percent of their fiscal year 1999 PFC payments before 
January 1, 1999, rather than receiving half in mid-December or mid-
January and the rest by September 30, 1999. This legislation increased 
calendar 1998 PFC payments by about $0.5 billion and reduced calendar 
1999 PFC payments by the same amount.
    Under the 1996 Farm Bill, crop producers received PFC payments of 
$5.7 billion in fiscal year 1998 and will receive $5.5 billion in 
fiscal year 1999. Other direct payments provided under the 1996 Farm 
Bill include loan deficiency payments, which are paid to producers when 
crop prices fall below the announced loan rate, and payments to 
producers participating in conservation programs. In 1998, loan 
deficiency payments were record high with producers receiving about 
$1.8 billion in loan deficiency payments.
    Conservation Programs.--Conservation programs are proving to be 
very helpful in improving the economics of farming. Farmers and 
ranchers receive about $2 billion in direct payments annually under 
USDA's conservation programs. The largest of these programs is the 
Conservation Reserve Program (CRP). Under this program, farmers receive 
an annual rental payment and partial payment for establishing 
appropriate cover as compensation for taking fragile land out of crop 
production. Currently, over 30 million acres are enrolled in the CRP, 
helping to enhance wildlife habitat, reduce soil erosion, and improve 
water and air quality. During the 18th signup, 7.1 million acres were 
offered for enrollment, and USDA expects to announce accepted bids 
soon. Under the Environmental Quality Incentives Program (EQIP), USDA 
provides cost-share payments to farmers and ranchers who adopt sound 
conservation and manure management practices. This and other 
conservation programs are helping producers reduce soil erosion, enrich 
soil productivity, improve water quality and wildlife habitat, restore 
lands damanged by adverse weather, and earn income or reduce costs of 
conservation practices.
    While USDA's conservation work helps producers directly with 
financial assistance, the technical assistance that is provided is 
equally important. For example, many livestock owners face increasing 
regulatory pressures from EPA, and state, and local agencies to improve 
water quality. This often means having a safe way to use animal wastes. 
Through our technical assistance, USDA works with producers to develop 
a plan that allows them to apply the manure to land thereby recycling 
nutrients, reducing the cost of inputs, and helping meet other 
environmental requirements.
    Financial Situation.--It is hard to characterize simply the 
financial condition of so diverse an industry as U.S. agriculture. 
Aggregate financial indicators portray a sector with problems in some 
areas but generally performing adequately entering 1999, due in part to 
higher government payments authorized last year and lower production 
expenses. Net cash farm income--gross cash income less gross cash 
expenses--of $59 billion in 1998 was down only slightly from the record 
of nearly $61 billion in 1997. Farm debt has risen 2-3 percent per year 
in recent years, but the value of farm assets has grown faster. 
Consequently, farm equity has steadily increased and the debt-to-asset 
ratio has remained steady at about 15 percent, down from over 20 
percent in the mid-1980s. In 1999, however, aggregate indicators 
suggest increasing financial stress. USDA forecasts net cash farm 
income will fall to $55.5 billion in 1999. U.S. average farm real 
estate values may rise slightly, reflecting low inflation and borrowing 
costs, but land values began declining in 1998 in some regions. 
Meanwhile, farm debt could decline as farmers reduce their borrowing in 
response to added government payments, low prices, and reduced spending 
on equipment and other production inputs. However, if farm income 
declines as projected, farm operators will have less income available 
in 1999 to meet principal and interest payments. In addition, many 
producers struggled with cash flow in 1998 resulting from low prices 
and adverse weather, and these problems will worsen if low prices 
linger, as USDA now expects.
    Looking ahead at individual commodities reveals an unsettling 
picture. Continued low hog, cattle, and field crop prices will place 
additional financial pressures on producers who specialize in the 
production of these commodities and are already highly leveraged. Hog 
prices could continue to remain below break-even levels for most 
producers for much of 1999, and cattle prices, which have been low for 
quite some time, may still not be strong enough to return a profit for 
some producers for much of the year. For principal crops, net income 
could fall sharply. In 1999/2000, the net income (production value plus 
government payments minus total cash expenses) from wheat, corn, 
soybean, upland cotton and rice production could drop to $17 billion, 
compared with over $19 billion in 1998/99 and the average of $22.7 
billion for the previous 5 years.
                        outlook for major crops
    Wheat and Rice.--The story of the U.S. wheat market over the past 2 
years has been rising production, weak exports, rising stocks, and 
declining prices after successive years of strong prices in the mid-
1990's. In 1998/99, U.S. wheat production reached 2.6 billion bushels, 
as record yields more than offset a 6-percent drop in planted acres 
from a year earlier. Total wheat supplies--the sum of carry-in stocks 
and production--increased 12 percent in 1998/99, compared with the 
prior year, providing the largest supply of wheat in more than a 
decade. The strong increase in supplies has pressured wheat prices, 
which USDA forecasts will average $2.70 per bushel for the 1998/99 
season, down from $3.38 last year, and will likely end up being the 
lowest season-average price in 8 years.
    Total domestic use is likely to increase about 8 percent in 1998/
99, as lower wheat prices this past summer increased feed use. In 
contrast, weak global demand and strong overseas competition could 
lower U.S. wheat exports, despite increased donations to Russia and 
several other needy countries. Exports of soft red winter wheat may be 
less than half of the 1997/98 level due to larger supplies of similar 
wheat in several importing and in competing exporting countries. Hard 
wheats, especially those with higher proteins, have fared better 
because of strong demand by several countries for blending with their 
lower quality crops and because of reduced supplies in Canada. Even 
with the expanding total use of U.S. wheat, USDA estimates that 
carryover stocks at the end of the 1998/99 season, compared with total 
use, will be the highest since 1987/88.
    On the world front this season, global wheat production is down 4 
percent from 1997/98's record, as area and yield each declined around 2 
percent. The European Union (EU) harvested a record-large crop in 1998/
99 because of record yields. Australia is expecting a larger crop as 
favorable planting conditions led to expanded area. Argentine 
producers, however, cut plantings in response to low prices. Canadian 
producers also cut plantings, but production was about unchanged from 
1997/98 due to higher yields. With production down and world 
consumption up modestly, world wheat carryover stocks for 1998/99 will 
decline, a positive development for U.S. producers.
    Unfortunately, global import demand may be down 9 percent this 
season because of bigger crops in several key importing countries, such 
as Pakistan and North Africa. China will again remain a small importer 
because of another large crop and huge stocks, while large production 
and government stocks are sharply reducing India's import needs. For 
Indonesia, the financial crisis and the elimination of the consumer 
flour subsidy has sharply reduced wheat imports. Latin America may see 
limited demand growth, but little year-to-year change is likely for 
East Asia.
    For 1999/2000, U.S. fall winter wheat plantings were down 7 percent 
from a year earlier and the lowest since 1972/73. If spring wheat acres 
are similar to last year and yields remain near the historical trend, 
USDA expects a 1999/2000 crop of around 2.2 billion bushels. However, 
large carry-in stocks will be partially offsetting and supplies may 
still be the second largest since 1990/91. World stocks may decline 
again as consumption exceeds production. A tighter but ample U.S. and 
global stocks situation should raise U.S. prices but only moderately--
on the order of 10 percent--in 1999/2000, and USDA does not expect 
substantial price improvement unless adverse weather lowers global 
wheat production.
    The U.S. rice market has performed surprisingly well compared with 
expectations prior to enactment of the 1996 Act that generally foresaw 
declining U.S. rice production. In 1998/99, U.S. rice production 
exceeded 188 million hundredweight (cwt.), up 3 percent from last year 
and the second largest crop on record. All States produced larger rice 
crops in 1998, except California because of adverse weather there in 
1998. Supporting the increase in plantings has been strong domestic 
demand and exports over the past two seasons and firm prices. In 1998/
99, USDA estimates the farm price will average $8.50 per cwt., down 
from $9.70 last year.
    Domestic use of rice is likely to remain strong in 1999/2000, but 
exports will face strong competition. Rough rice sales to Latin America 
are likely to be affected by economic problems there, and the global 
long-grain milled market will be very competitive, particularly with 
lower-priced rice from Thailand and Vietnam. Recently, U.S. long-grain 
rice has been selling at about a $70-$80 premium to similar grade Thai 
rice, compared with a typical premium of $25-$40 in many of the high-
quality markets in the Middle East, Africa, and Europe. The U.S. price 
premium could return to more a normal level in 1999/2000, pushing the 
average U.S. farm price of rice below this season's level.
    Corn and Other Feed Grains.--U.S. feed grain production in 1998/99 
exceeded more than 271 million metric tons, up 4 percent from last year 
and the second highest on record. The corn crop rose 6 percent to the 
second highest level in history, while grain sorghum production dropped 
18 percent and barley and oats production were little changed from 
1997/98. Drought reduced corn production in Texas and across several 
Southern States. However, these production losses were more than offset 
by gains elsewhere, especially in the northern and western edges of the 
Corn Belt. Minnesota, Kansas, Nebraska and the Dakotas all had record 
corn crops in 1998.
    Corn supplies in 1998/99 are up 10 percent from last year, because 
of the larger crop and bigger carry-in stocks. The strong increase in 
supplies has dampened feed grain prices and sharply increased projected 
carryover levels. While USDA forecasts total use of corn to be the 
second highest level on record, total use will not approach 1998 
production. U.S. ending stocks of corn on September 1, 1999, are likely 
to be up nearly 500 million bushels from last year to their highest 
level since 1992/93. As a result, USDA's corn price forecast of $1.95 
per bushel for 1998/99 is down from $2.43 last year, and this year's 
season-average price will likely be the lowest in more than a decade.
    USDA expects gains in feed use and expanding use for ethanol and 
high fructose corn syrup production will push domestic use of corn to a 
new record in 1998/99. U.S. corn exports are likely to rise from 1997/
98's low level as Argentina's crop declines, but stagnant global demand 
and continued strong competition from South Africa and China will limit 
the increase in exports. Also, low-priced foreign supplies of other 
coarse grains, especially barley, are limiting import demand for corn.
    Global coarse grain production fell slightly during 1998/99, as 
smaller crops in the former Soviet Union, Eastern Europe, and Argentina 
offset higher U.S. production and a rebound in China's corn crop from 
the drought-reduced 1997 level. Corn production declined in Eastern 
Europe as yields dropped from last year's high level. USDA expects 
Argentina's crop to decline as early dry conditions and more favorable 
prices caused farmers to shift some area to later-planted soybeans. 
China's corn production rebounded in 1998 and stocks are rising, but 
low world prices are likely to keep its exports below the 1997/98 pace.
    USDA projects global corn imports to be down slightly from last 
year, despite expanding demand in North Africa, the Middle East, and 
Latin America, excluding Mexico. A larger crop could reduce slightly 
Mexico's corn imports, and Asian demand continues to shrink. 
Indonesia's imports will be minimal as domestic production is 
sufficient to meet the needs of its sharply reduced poultry industry. 
Mixed feed production is dropping in South Korea as the financial 
crisis cuts meat demand.
    Assuming trend yields, U.S. corn supplies could be up again in 
1999/2000 as sharply higher beginning stocks more than offset a smaller 
crop. Domestic use will continue to expand, but the year-to-year gains 
will be less than in recent years because of reduced livestock 
production. U.S. corn exports are likely to rise in 1999/2000 as import 
demand continues to rise in North Africa, the Middle East, and Latin 
America and demand begins to recover in Mexico and parts of Asia. 
However, U.S. export gains could be limited by stronger Argentine 
production and exports in 1999. Thus, in the absence of adverse 
weather, corn production and total use may about balance, leaving U.S. 
corn carryover stocks at high levels in 1999/2000 and the price outlook 
for feed grains about unchanged.
    Soybeans and Other Oilseeds.--Producers have responded to the 
planting flexibility provisions of the 1996 Act by expanding soybean 
acreage and production. In 1998, U.S. producers planted 72.4 million 
acres to soybeans, up from 70.0 million acres last year and from 64.2 
million acres in 1996. U.S. soybean production was record high both in 
1997 and 1998.
    In 1998/99, total U.S. soybean supplies are record high, 
approaching 3 billion bushels and up 5 percent from the previous 
season. However, total soybean use is likely to fall about 3 percent in 
1998/99, as domestic use stagnates and U.S. exports face strong 
competition from Brazil and Argentina. As a result, USDA now expects 
1998/99 U.S. carryover stocks to increase to 410 million bushels, more 
than double last year's level and the highest carryover in more than a 
decade. The increase in ending stocks is pressuring farm soybean 
prices, which are expected to decline from an average of $6.47 per 
bushel last season to $5.20 in 1998/99, the lowest since 1986/87.
    Other than China and Mexico, there are few foreign markets that 
will likely import more soybeans this season. For 1998/99, USDA 
projects a 3-percent decline in global soybean imports. EU crushers 
have run down supplies of rapeseed and sunflowerseed. Given the 
comparatively large stocks remaining in South America, U.S. export 
commitments continue to trail last year's pace. USDA projects U.S. 
exports of soybeans, soybean meal, and soybean oil will be down 7, 17, 
and 15 percent, respectively, in 1998/99, compared with one year ago.
    The recent devaluation of the Brazilian real could lead to more 
pressure on soybean prices this spring and summer as Brazil markets 
this year's crop more quickly than normal. This would further reduce 
1998/99 U.S. exports and add to U.S. carryover. On the other hand, 
larger Brazilian exports in 1998/99 could help U.S. exports in 1999/
2000 by reducing the South American carry-in. In addition, lower world 
prices in 1998/99 may cause South American growers to reduce oilseed 
plantings in 1999, reducing competitor supplies.
    U.S. soybean planted acreage in 1999 is likely to increase from 
last year's record, and foreign competition will likely remain intense. 
Returns from planting soybeans continues to remain strong relative to 
other crops. The marketing assistance loan rate for soybeans relative 
to other crops and greater use of herbicide-resistant soybeans, which 
has cut costs, may encourage some producers to expand soybean 
plantings. In addition, yield potential has risen sharply in recent 
years, as producers have expanded plant population counts and used 
improved soybean varieties adapted to their area. Yields also have been 
resilient to adverse weather. With trend yields, U.S. soybean 
production in 1999 could exceed last year's record.
    The demand for soybeans and soybean products in both the U.S. and 
the rest of the world will expand in 1999/2000 but below the growth 
rates of recent years. Use in Asian countries may stabilize. China's 
consumption of both protein feeds and vegetable oils should rise 2-4 
percent but well below growth in recent years. In both the U.S. and the 
EU, protein use should expand by 1-3 percent helped by lower protein 
prices and a small increase in red meat and poultry production. 
However, the increase in demand is not likely to be enough to avoid a 
further increase in U.S. soybean carryover and even lower soybean 
prices, which could average below $5 per bushel, in 1999/2000.
    Cotton.--Cotton plantings fell 3 percent in 1998, resulting in the 
lowest cotton planted area since 1992. However, U.S. cotton production 
in 1998/99 fell by over 25 percent from last year, resulting in the 
smallest crop in 9 years, as adverse weather affected all four cotton-
producing regions. Drought was especially severe in Texas, where 
farmers abandoned a record 42 percent of planted acres. Due to the drop 
in cotton production, total U.S. cotton supplies in 1998/99 are down by 
over 20 percent, compared with last season. Despite tighter supplies 
and ending stocks, cotton prices so far this season have averaged below 
last year as demand has softened.
    USDA projects domestic mill use at 10.4 million bales, down 8 
percent from last year. The decline in domestic mill use primarily 
reflects rising cotton textile and apparel imports, which are amply 
available at low prices because of reduced Asian demand. U.S. imports 
have risen at an annual rate of 20 percent since the beginning of 
calendar 1997 and are projected to reach about 14.0 million-bale 
equivalents this season. The cotton textile trade deficit of 
approximately 9.5 million-bale equivalents is equal to 45-50 percent of 
estimated total U.S. end-use consumption of cotton.
    Tight U.S. supplies and the loss of Step 2 payments have reduced 
the ability of U.S. cotton to compete in world markets and increased 
the prospects for substantial cotton imports later this year. U.S. 
cotton exports could drop to only 4.2 million bales, down from 7.5 
million bales last year and the lowest since 1985/86. USDA forecasts 
U.S. raw cotton imports of 350,000 bales during 1998/99, down slightly 
from 2 years ago but up sharply from last season. Imports will surge 
after the Step 3 quotas trigger.
    Both world cotton production and consumption are down in 1998/99. 
World production is down 7 percent from last season, due mainly to 
production declines in China and the United States. China's crop is 
estimated to be down 6 percent from last year. World consumption is 
projected down 2 percent from last year, the largest year-to-year 
decline since 1974/75. Reasons for falling consumption include the 
Asian economic crisis, increased competition with polyester due to 
surplus synthetic fiber production capacity in Asia, economic problems 
in Russia and Brazil, and increased competition from textile exports 
from countries such as Indonesia and Thailand.
    Lower prices for alternative crops could keep U.S. cotton plantings 
in 1999 at near last year's level. While plantings may be about 
unchanged in 1999, U.S. cotton production could be up about 25 percent 
with a return to trend yields. A much larger crop would improve U.S. 
cotton's competitiveness in world markets, thereby reducing imports and 
increasing exports from this season's projected levels. However, weak 
world demand could limit export growth and U.S. ending stocks could 
rise in 1999/2000, further pressuring cotton prices. Textile imports 
are likely to remain strong in 1999/2000 and limit growth in domestic 
mill use.
                         outlook for livestock
    Cattle.--The average price received for all beef cattle fell 6 
percent in 1998. USDA had expected cattle prices to strengthen during 
the second half of 1998 following steady herd liquidation since late 
1995. However, low cattle prices and drought in southern States caused 
producers to continue to reduce their herds, increasing cattle 
available for placement into feedlots. In addition, with good northern 
forage supplies and producers trying to keep animals on grass longer 
with the hope of receiving higher prices, ranchers placed heavier 
animals into feedlots raising average dressed slaughter weights from 
699 pounds in 1997 to 723 pounds this year. The continuing liquidation 
and heavier slaughter weights caused beef production to increase by 1 
percent in 1998.
    The economic problems in Asia and Russia as well as herd reductions 
in many major beef exporting countries caused the U.S. beef trade 
balance to worsen in 1998. U.S. beef imports increased about 11 
percent, as world trade slowed and more product was moved into the 
strong U.S. economy. In comparison, U.S. beef exports rose 1 percent 
with reduced exports of higher value cuts to Asian countries only 
partially offset by higher exports to Mexico. On a weight basis, 
however, net imports equal less than 2 percent of U.S. beef production.
    Beef production will likely decline in 1999 as slaughter levels and 
weights fall, and lower production should bolster cattle prices in 
1999. Cattle inventories have declined since 1996, and the 1998 calf 
crop was the lowest since 1952. USDA expects the combination of fewer 
slaughter cattle and lower dressed weights to reduce beef production in 
1999 by about 3 percent to 25.0 billion pounds.
    Much of the year-to-year decline in beef production will not occur 
until the second half of the year. During early January, producers 
indicated that the number of heifers over 500 pounds that they are 
retaining for beef cow replacement was 4 percent below a year earlier. 
This will make almost the same number of heifers available for 
placement into feedlots through the first half of 1999 as last year. In 
the second half of the year, USDA expects producers' increased 
retention of heifers for the breeding herd and lower slaughter weights 
will reduce year-over-year beef production by 5 percent. For all of 
1999, USDA expects fed cattle prices to average $65.50 per cwt. in 
1999, compared with $61.48 last year and $66.32 two years ago.
    U.S. beef trade is likely to be more in balance in 1999 as import 
growth slows and U.S. government donations of beef increase. Largely 
due to food aid to Russia, U.S. beef exports are projected to increase 
about 8 percent. In comparison, declining beef supplies in Canada and 
Oceania are expected to reduce the growth in U.S. beef imports to about 
4 percent in 1999.
    Hogs.--Hog production increased by 10 percent in 1998, reflecting 
strong returns the previous 2 years and expansion of large hog 
operations. Producers expanded inventories to the point that by 
September 1, 1998, there were 63.5 million hogs on farms, the highest 
since 1980. Large productivity increases and structural change also 
fueled the inventory expansion. Increases in pigs per litter, litters 
per sow per year, and weight per animal slaughtered have combined to 
raise pork produced per breeding animal by 20 percent since 1988.
    The abnormally large year-to-year increase in pork production 
caused hog prices to tumble from year ago levels. For all of 1998, 
slaughter hog prices averaged $31.67 per cwt., down from over $51 in 
1997 and the lowest since 1972. In December, hog supplies strained 
processing capacity causing hog prices to drop to the $10 per cwt. 
range. Weekly hog slaughter frequently reached 2.2 million head during 
the fourth quarter of the year, with weekday kills of over 400,000 head 
and Saturday kills of 200,000. Total fourth quarter slaughter reached 
27.6 million head, 1 million more than the fourth quarter of 1994, the 
last time hog prices plunged.
    Larger hog imports were a factor in overall price declines in 1998, 
but not a major factor. The strong U.S. dollar rate of exchange with 
the Canadian dollar, large hog production, low prices in Canada, and 
labor problems at Canadian hog packing plants led to U.S. imports of 
Canadian hogs of 4.1 million head in 1998, about 4 percent of U.S. pork 
production, and up from 3.2 million head in 1997. Canadian hog imports 
reached a higher level in late 1997 and early 1998, and they maintained 
that level so that weekly imports during the low-priced fourth quarter 
were not much different than during the third quarter.
    Despite the weak world economy and the strong U.S. dollar, U.S. 
pork exports actually increased sharply in 1998. The United States 
exported more than 1.2 billion pounds of pork in 1998, up 18 percent 
from last year. In contrast, pork imports rose 10 percent to 695 
million pounds in 1998. The United States continued to be a major 
market for pork from Canada and Denmark in 1998, while the major U.S. 
export markets included Japan, Russia, Mexico and Canada.
    USDA expects continued large hog supplies to pressure processing 
capacity and prices during the first half of 1999. The market hog 
inventory on December 1, 1998, was 2 percent above a year earlier. 
However, pork production could be up about 5 percent during the first 
half of 1999, as continued low prices provide a further incentive for 
producers to reduce the breeding herd. In addition, low prices could 
cause producers to market hogs at heavier weights. Hog prices will 
likely average in the $25-$35 per cwt. range during the first half of 
1999, which would be below breakeven for most producers.
    As hog slaughter begins to decline in the second half of 1999, 
prices should rise above last year's level, particularly in the fourth 
quarter. Producers have already responded to the exceptionally low 
prices in the last half of 1998 by reducing the breeding herd, which on 
December 1 was 4 percent below a year earlier. In addition, producers 
have indicated intentions to farrow 7 percent fewer sows during March-
May compared with a year earlier. This implies a fractional decline in 
third quarter pork production but a 10-percent drop for the fourth 
quarter. For all of 1999, USDA forecasts hog prices to average $34 per 
cwt., 7 percent higher than last year.
    U.S. pork exports are likely to increase about 10 percent in 1999, 
while imports remain steady. Increased pork exports to Mexico, Japan, 
and other markets are likely to more than offset lower exports to 
Canada and Russia. The economic crisis could limit U.S. pork exports to 
Russia to donations under food aid programs, causing exports to Russia 
to fall below the level achieved in 1998. Exports to Canada may also 
trend downward, as restructuring and expansion of the Canadian pork 
industry reduces the demand for U.S. pork products.
    Continued low hog and pork prices for much of 1999 will likely 
limit the growth in pork imports, and U.S. live hog imports could fall 
below last year. Slaughter capacity increases in Manitoba, the 
settlement of labor disputes in Canadian hog slaughter plants, and 
Ontario hogs increasingly moving to slaughter in Quebec under buying 
agreements may lower U.S. hog imports from Canada in 1999 but only 
slightly.
    Broilers.--The rate of growth in broiler production was only 2 
percent in 1998, as production was negatively affected by below-normal 
egg hatching rates. Consequently, broiler prices for all of 1998 
averaged 7 percent above 1997, weakening during the fourth quarter with 
the loss of the Russian market and higher U.S. production. In response 
to higher prices and a return to more normal hatching rates, USDA 
expects broiler production will be up nearly 6 percent in 1999. The 
increase in production could lower the price of broilers from over 
$0.63 per pound last year to $0.59 per pound in 1999.
    Broiler meat exports will probably remain weak through much of 
1999. The loss of the Russian market is unlikely to be offset by gains 
in other markets, and first-half exports could be 20-25 percent lower 
than in 1998. Exports in the second-half of 1999 may increase relative 
to 1998, especially if sales opportunities with Russia reappear.
    Dairy.--Farm-level milk prices were record-high in 1998, averaging 
$15.38 per cwt., compared with $13.34 in 1997. The sharp increase in 
farm-level milk prices reflected modest growth in milk production and 
strong demand for milk products. In 1998, milk production was adversely 
affected by weather in California, Texas, and the Southeast. In 
addition to high milk prices, lower feed prices boosted dairy 
producers' incomes in 1998.
    Dairy farmers appear to be reacting to the record-high milk prices 
and low feed costs over the past year by expanding milk production, 
which is projected to average about 2 percent higher in 1999. After 
being up only fractionally for most of the year, milk production 
increased by 3.5 percent from November 1998 through January 1999. In 
response to the increase in milk production, which supported higher 
cheese production, wholesale cheese prices fell sharply in January 
dropping by about $0.60 per pound. The sharp decline in the price of 
cheese will lead to a steep drop in farm-level milk prices over the 
next few months. For all of 1999, USDA expects farm-level milk prices 
to average about $1 per cwt. lower than last year--putting them about 
halfway between the 1997 and 1998 levels--but the decline could be even 
steeper if recent monthly year-over-year increases in milk production 
are maintained through much of 1999.
                     outlook for retail food prices
    The Consumer Price Index (CPI) for food increased by 2.2 percent, 
while the CPI for all items increased by 1.6 percent in 1998. Last 
year, lower retail prices for beef, pork, eggs, and nonalcoholic 
beverages were more than offset by higher prices for dairy products, 
fish and seafood, fats and oils, fruits and vegetables, cereal and 
bakery products, and sugar and sweets. Retail dairy product prices 
increased by 3.6 percent in 1998, reflecting the sharp increase in 
farm-level prices. Strong vegetable oil prices caused the CPI for fats 
and oils to increase by 3.7 percent, and weather problems in 
California, Florida, Texas, and some importing countries pushed up 
retail prices for fresh fruits and vegetables by more than 7 percent 
last year.
    USDA expects the CPI for food will increase by 2-2.5 percent in 
1999. Retail prices for fruits and vegetables should be up only 
modestly in 1999, assuming there are fewer weather problems in the 
major fruit and vegetable growing areas this year. In addition, 
continued large supplies of red meat and poultry will likely prevent 
retail prices for meat and poultry from increasing much in 1999.
    Longer Term View.--Looking to the longer term, USDA's recently 
published agricultural baseline projections to 2008 provide a view of 
how the global farm economy would unfold over the next decade under a 
very specific set of assumptions about policy and weather. This 
ambitious effort is primarily the work of the Economic Research 
Service. While we can be sure that the projections will turn out wrong 
because the assumptions never hold, the analysis is extremely useful to 
understand the possible implications of the underlying trends as we now 
see them. A few highlights are:
    The global macroeconomy takes 3-4 years to recover to a stable, 
moderately strong rate of growth. The global economic problems mean a 
prolonged weakness in global demand for farm products. The slow 
recovery in the world economy and ample supplies in competitor 
countries results in U.S. agricultural exports not returning to the 
record level of 1996 until about the year 2003. U.S. planted acreage 
drops only a small amount, and with trend yields supplies remain large, 
leading to a slow recovery in nominal farm prices and steadily 
declining inflation-adjusted farm prices throughout the projection 
period. In particular, real soybean and hog prices decline 
substantially compared with other commodities. Recovery in the global 
economy leads to strong growth in U.S. meat and poultry exports after 
3-4 stagnant to slow growth years. U.S. cattle production turns up for 
several years starting in 2001, but then declines under strong 
competition from hogs and broilers. Net farm income grows slowly 
throughout the projection period and does not reach the 1996 record 
high of $53.4 billion. Loan deficiency payments are made through 2002. 
The farm balance sheet improves as the overall debt-to-asset ratio 
slowly declines throughout the projection period in line with the slow 
declines observed during much of the 1990's.
                    key uncertainties in the outlook
    There are many uncertainties that could affect markets and the 
well-being of market participants over the next 1 to 2 years. Three key 
factors follow:
  --Weather and agricultural production.--Last year's heavy rain and 
        flooding in California and drier than normal conditions in the 
        Southern Plains and South highlighted the role of weather in 
        crop production and farm financial conditions. The current La 
        Nina weather event is having a limited effect on U.S. 
        agriculture, with the possible exception of the December freeze 
        in California that severely reduced citrus production. La Nina 
        is not expected to be a major factor affecting global or U.S. 
        crop production this year. However, weather forecasting remains 
        imprecise and the possibility remains that adverse weather 
        could cause a major shortfall in world crop production and a 
        strong increase in prices from current levels.
  --Macroeonomic Performance in Asia and Latin America.--A number of 
        very important markets for U.S. agricultural products fell into 
        recession in 1998, including Southeast Asia, South Korea, and 
        Japan, which account for about one-quarter of the value of U.S. 
        agricultural export sales. Moreover, the Russian economy is 
        expected to sink dramatically in 1999. The current economic 
        problems in Brazil will lead that country into recession in 
        1999 and could cause major problems for other Latin American 
        countries. If the Asian economies fail to stabilize or the 
        economic problems in Brazil spread to other Latin American 
        countries, which account for one-fifth of U.S. agricultural 
        export sales, U.S. agricultural exports could drop further, 
        placing additional pressure on farm commodity prices over the 
        next 2 years. The engines of growth in the world economy right 
        now are the U.S. and the EU. Should either of these two 
        countries fall into recession there would be a global recession 
        that would further erode world food and fiber demand and U.S. 
        farm exports.
  --China.--The outlook for U.S. agriculture is very much linked to 
        what happens in China, home to one-fifth of the world's 
        population. USDA expects China's economy will maintain the 
        strongest growth in Asia over the next several years with per 
        capita GDP growth of 7 percent or more per year. As incomes 
        grow, the demand for food is expected to outpace increases in 
        production causing China to expand agricultural imports. 
        However, China's emphasis on self-sufficiency has raised their 
        grain and cotton production, stocks, and exports this year. 
        Although cotton production incentives appear to be coming down, 
        continued emphasis on grain production and maintenance of trade 
        barriers could dampen future growth in world grain trade and 
        grain prices. In addition, the pace of economic growth may be 
        overly optimistic, given the economic problems in China and in 
        several neighboring countries. Alternatively, if the pace of 
        economic and trade liberalization could quicken, China could be 
        integrated in into the world economy more rapidly than 
        anticipated, which would further strengthen world grain 
        markets.
    Mr. Chairman, that concludes my testimony, and I will be happy to 
respond to any questions.

    Senator Cochran. Thank you very much, Mr. Collins.
    Before we proceed to hear from Mr. Schumacher, I think I 
will yield at this point to my colleagues on the subcommittee 
for any opening statements or remarks that they would like to 
make at this time.
    Senator Kohl.
    Senator Kohl. Thank you, Senator Cochran. I have an opening 
statement that I will put into the record because I know that 
will expedite our hearing.
    Senator Cochran. Thank you. That statement will be in the 
record.
    [The statement follows:]
                   Prepared Statement of Senator Kohl
    Secretary Schumacher, Mr. Collins, and Mr. Kaplan, let me join 
Senator Cochran in welcoming you. Our hearing this morning addresses 
``Assistance to Farmers and the Farm Economy''. That could encompass 
anything from land conservation to agricultural anti-trust reform to 
trade policy. And though our subject matter is broad, in view of 
current trends in farm prices, it demands our immediate attention.
    Mr. Collins, I have reviewed the information in your prepared 
statement. I must say, you do not provide much encouragement for anyone 
wanting to go into farming. When Secretary Glickman testified before us 
last month, he observed that, in spite of a record strong national 
economy, those industries tied to natural resources, especially 
agriculture, are suffering dismally. That is bad news for this 
Subcommittee that has the responsibility of looking beyond Wall Street 
and into the fields and rural roads of small town America. This nation 
cannot be strong without strength in all parts.
    Let us go beyond generalities for a moment. Mr. Collins, you point 
out that farm exports dropped to $53.6 billion in fiscal year 1998, a 
10-percent reduction from 2 years before, and your projections include 
a further reduction to $49 billion this year. Further, I must point 
out, this is occurring in an era when we were all being told that 
``Trade'' was going to be the solution for agriculture's problems! I 
don't see much of a solution when farm exports are falling and we are 
still faced with unreasonable treatment from our trading partners.
    It sometimes seems difficult to get anyone's attention about the 
plight of U.S. agriculture. No one can deny the dramatic decline in the 
farm population over the course of this century. But the farmer's role 
as provider for our nation and protector of our natural resources 
remains as important as ever. Nations don't go to war over television 
sets; they go to war over adequate food supplies. Conservation of our 
natural resources gets a lot of lip service from our friends in the 
cities, but it is the farmer whose livelihood is tied to protection of 
soil and water resources. I want to know what the Department of 
Agriculture is doing to help farmers meet the challenges of 
environmental protection that will avoid the sometimes harsh rule of 
regulation. The responsibility we carry to protect the farmers of 
America is as important as the responsibility of our nation's farmers 
to provide for all of us. One cannot and should not ignore the other.
    Therefore, I was becoming increasingly alarmed the past few weeks 
when we failed to see any action by the Administration to propose 
additional funding for farm programs in the upcoming supplemental that 
you knew was before Congress. It made many of us wonder if anyone in 
the Administration really cared about the crisis in rural America and I 
would welcome any of your comments to put our concerns to rest. When 
Secretary Glickman appeared before us nearly one month ago, he 
mentioned several needs which still have not been formalized in the 
form of a budget request to the Congress.
    I hope someone can explain to my satisfaction why there seems to be 
such a disconnect within the Administration on something as important 
as protecting the farm economy. It was very well for the President to 
mention the plight of farmers in his State of the Union Message, but we 
had hoped to see something of substance to follow his words. We are 
waiting still.
    I hear from my farmers in Wisconsin just as all Senators here 
listen to farmers in their states. I know that while dairy prices have 
been high, the outlook is grim. Volatility in farm prices concerns me 
greatly. It is anticipated that dairy prices are going to fall from 
record highs earlier this year to record lows in the coming weeks and 
months. I wonder how many other sectors of the economy could survive 
the enormous shifts in net income that farmers have to live with year 
in and year out.
    To exacerbate the problem of prices for dairy farmers is the 
ongoing problem of policy. Secretary Glickman informed this 
subcommittee that distribution of the $200 million we provided last 
fall for dairy farmers will be provided in time to help cushion the 
coming fall in dairy prices. However, let me firmly state that 
providing dollars to help dairy farmers recover from falling prices 
must not in any way be connected to the overall dairy policy reforms 
you are soon to announce. It goes without saying that I will be 
watching both developments very closely and one must not, under any 
circumstances, be a quid pro quo for the other.
    Secretary Schumacher, among your responsibilities is to provide 
U.S. agriculture a strong voice in world trade. Historically, 
agriculture has been the shining light in U.S. trade, but as I stated 
above, it appears that light cannot continue to shine brightly through 
the haze of unfair practices by some of our trading partners and 
uncontrollable financial problems now affecting much of the world. 
Still, you possess tools to help farmers find their way to new 
consumers around the world. We must continue those efforts. In 
addition, I worry about the ability of farmers, especially small family 
farmers, to survive in an economic climate largely controlled by a few 
corporate giants. Small farmers, too, need direct access to markets. 
They need to be their own ``middle-men'' and keep more profits in rural 
America rather than corporate board rooms.
    Let me close by saying that no one in this room, or watching around 
the country, wants to see us return to the conditions of the 1980's 
when foreclosures and bankruptcies were the rule of the day. We need to 
look at measures to conserve land, to smooth agricultural price 
volatility, to protect our farmers from uncompetitive concentration in 
their industry, to open markets to our quality American agricultural 
products. These are large tasks, but farmers in Wisconsin and around 
the nation deserve Federal attention that acknowledges their central 
place in the history of America's prosperity and way of life.

    Senator Cochran. Senator Gorton.

                      STATEMENT OF SENATOR GORTON

    Senator Gorton. Thank you, Mr. Chairman.
    As you know, last year Congress provided a $6 billion 
disaster and relief package for U.S. agriculture. This package, 
as you recall, was drafted and passed with the purpose of 
aiding the agriculture based regions of the country that 
experienced natural disaster and market losses. Although this 
package did relatively little to assist producers in Washington 
State who have been impacted by the Asian flu, worldwide 
stockpiles of commodities and certain unilateral sanctions, it 
certainly signified the concern all of us have regarding our 
Nation's farm economy.
    While there is no question that commodity prices have 
slipped in this country and many family farms are on the brink 
of bankruptcy, I question USDA's proposed budget as it 
addresses these concerns. On-the-ground production agricultural 
programs appear to be of no real significance in this budget. 
Research money is allocated for global research and climate 
change instead of regional programs this subcommittee and this 
country's commodities consistently request and support.
    Funding is not requested for the implementation of 
prospective crop insurance reforms. Federal private land 
purchase programs are significantly increased, showing that 
USDA's interest is in simply buying up land farmers can no 
longer afford to harvest.
    Export programs are decreased, even though almost every 
major producer organization of the country has requested 
additional foreign market assistance.
    My two greatest concerns as a member of this subcommittee, 
concerns that growers in Washington State consistently 
emphasize, are agriculture research and export enhancement. For 
several years, it has been apparent that the Administration 
does not agree with growers or me on the subject of regional 
research. The Administration should recognize the error of its 
ways and discontinue its attempts to eliminate regional 
research programs.
    Second, with respect to exports, I urge USDA to understand 
the importance of agricultural exports and to use the upcoming 
World Trade Organization's negotiations in Seattle to expand 
and enhance our Nation's agricultural trade. With more than 25 
percent of Washington State's commodities being exported, our 
agricultural community has a unique and important interest in 
these negotiations.
    As the department prepares for the WTO Ministerial, I urge 
it to consider the importance and significant impact trade has 
on Washington State and on the entire Nation's agricultural 
economy.
    Senator Cochran. Thank you. Strong letter follows. 
[Laughter.]
    At this time I would like to submit Senator Burns, and 
Senator Feinstein's prepared statements for the record.
    [The statments follow:]
                  Prepared Statement of Senator Burns
    Thank you, Mr. Chairman.
    I look upon this Subcommittee to improve the devastating economic 
situation for American farmers and ranchers. They need more than a 
helping hand or a quick fix. They need solutions that will pull them 
out of this crisis and keep them out from any more like it in the 
future.
    The agricultural producer is drowning in a sea of debt and many in 
Congress want to continue to send lifeboats. The problem is that once 
the producer makes it into the boat he cannot seem to get to shore. He 
just continues drifting, barely afloat, and always paddling to try to 
make it to shore. I would like to see laws passed this session that 
will not only provide a temporary lifeboat to farmers and ranchers, but 
pull them completely out of the water.
    I believe one way to do that is through an effective crop insurance 
program. An operative farm income safety net is paramount to the 
survival of agriculture. A long-term viable solution will be necessary 
for a safety net with staying power. There are several ideas for crop 
insurance reform that are being proposed for Congress this year. This 
project will no doubt be a huge undertaking and one that may or may not 
be passed in one session. However, the need for reform is imminent and 
I believe we can make the Federal Crop Insurance Program, or one like 
it, more useful to producers.
    I believe a truly effective crop insurance plan involves simply 
three things: private insurance, the federal government and the farmer. 
The federal government can help facilitate a program to unite the 
producer and the private insurance company. Privatization with 
government intervention will ultimately put the control in the hands of 
the farmer. With a risk management plan, bankers are also more likely 
to finance farmers if they have both their crop and their price 
covered, with a reliable insurance program. A lasting solution, such as 
effective insurance, is imperative to bring producers out of this 
current economic crisis.
    I know that several of my colleagues also realize the importance of 
crop insurance reform this session. The administration claimed crop 
insurance reform as one of its top priorities and urged Congress to 
repair the federal crop insurance system. Why then did the USDA neglect 
to include any funding for this program in the fiscal year 2000 budget? 
When questioned, Secretary Glickman stated that USDA will ``find'' the 
funds. I realize there is a longer growing season here in Washington 
D.C. than in Montana, but where I come from $1 billion doesn't grow on 
trees. The lack of funding provided for crop insurance is a slap in the 
face to each and every agricultural producer.
    Funding for the GLCI (Grass Lands Conservation Initiative) was held 
level under the NRCS budget rather than being increased. This program 
is invaluable to ecosystem management, which has been a top priority in 
President Clinton's environmental agenda. This program provides 
education and technical assistance to agricultural producers who 
continue to be the ultimate environmental stewards. Funding for this 
program should be increased from $15 million to at least $20 million.
    The proposed USDA budget claims it will strengthen the safety net 
for farmers and low income populations while providing economic 
opportunities for rural Americans. It also alleges it will protect our 
natural resources and further improve the safety of the food supply. 
While all worthwhile programs, this budget will have a hard time 
funding any of them adequately. The decreases reflected in the budget 
certainly do not help the farmer or rancher, and the program increases 
are not tailored to help them either. Agricultural producers are the 
backbone of this country and it is especially these people to whom the 
United States Department of Agriculture should be held accountable.
    I am extremely disappointed with the Farm and Foreign Agricultural 
Services budget cut. The President promised to bring trade in line with 
agricultures and Secretary Glickman recently suggested increased 
exports as a solution to the agriculture crisis. Yet, the Farm and 
Foreign Agricultural Services budget was cut by nearly $6.5 billion. 
Two of the main programs for exports, the Export Enhancement Program 
and the Food for Peace (Public Law 480) program, were reduced by $56 
million and $772 million respectively. The Export Enhancement Program 
has funds that are not being currently utilized. We need to make this 
money available now to allow producers to export commodities in 
storage. With 70 percent of Montana's grain sent for export we cannot 
afford to lose these important programs. This administration wants 
fast-track negotiation yet they are unwilling to appropriate or use the 
money for the export programs currently in place.
    Several other programs important to export enhancement were also 
cut. The Commodity Credit Corporation Program was cut by $5.8 billion, 
the Dairy Export Incentive Program by $15 million and the Food for 
Progress program by $24 million. With today's global market situation, 
producers cannot afford to have the few opportunities they have for 
export reduced. The CCC provides an important service for private 
negotiations with other countries. Agricultural producers have an 
increasing need for avenues to market their products through private 
entities. The budget cut to the CCC makes them more dependent on the 
federal government, rather than giving them opportunities to expand 
marketing channels.
    The international trade front continues to be a major problem in 
Montana and other western states, especially in regards to Canada. Even 
with programs like the Northwest Cattle Project, far more cattle flood 
the market from Canada than are exported from the United States. The 
Canadian Wheat Board, a state trading enterprise, maintains control of 
the grain market and lowers prices for producers on both sides of the 
border.
    The European Union also continues to be a thorn in the side of 
agricultural producers. Their non-compliance with World Trade 
Organization regulations on imports of bananas and beef should make 
them subject to severe retaliation. However, they are still treated as 
major players in the world market and have hardly received 
admonishment. China must also be subjected to more than a slap on the 
wrist for their non-tariff trade barriers. The barrier on TCK smut is 
non-scientific and only provides a way for China to prevent access to 
foreign grain.
    Trade inequities will continue to be a huge problem until they are 
addressed in a manner that means compliance. Mr. Schumacher, when will 
the Foreign Agricultural Service step in to reduce trade barriers and 
resolve international trade disputes? I thank you for your staffing and 
support in negotiations between the United States and Canada in Ottawa 
recently. However, these are baby steps. What agricultural producers 
need are comprehensive agreements that help them now.
    As a result of legislation passed last year and the FAIR act of 
1996, approximately $6 billion in government payments was to be given 
to farmers and ranchers in strife. This money is to be used to offset 
loss from crop losses and lower prices. Yet, I have constituents call 
every day wondering where their payments are. When Congress promises 
loss payments my people at home expect USDA to disperse those funds in 
a timely and efficient manner. Endless deadline extensions and hurry up 
and wait policies by the USDA are not helping the farmer pay the bank 
or the rancher buy hay for the winter.
    The biggest problem we have right now in the world of agriculture 
is getting a fair share of the consumer dollar back to the producer. 
The most important end result of any legislation introduced this 
Congress must be to return to the producer his or her share of the 
economic dollar. Something is wrong with the big picture. Somewhere 
between the time the producer sells the product and the time it reaches 
the table, there is a serious disconnect. I believe this committee 
needs to take a good look at the big picture and arrive at some 
effective solutions. I commit my support and my efforts to the Chairman 
and ranking member as well as to the producer in Montana and the nation 
to work on this issue with them in the coming year.
    Our producers have lost nearly all faith in any assistance the USDA 
or the federal government promises. If they have to go it alone right 
now, many will fail. They simply do not have the resources or the back-
up funds to allow them the luxury of zero dependence on government 
programs. This Department gives the impression of wanting to help the 
agricultural producer, but in reality farmers and ranchers may as well 
be going it alone. The continued disregard by the United States 
Department of Agriculture for the producers it should represent forces 
us to come up with an alternative solution.
    Thank you again, Mr. Chairman. I look forward to hearing some 
answers from the USDA, and more importantly to working with you in the 
coming year to improve the economic situation for the American farmer 
and rancher.
                                 ______
                                 
                Prepared Statement of Senator Feinstein
    I want to thank you for being here today.
    California is the leading agricultural producing State in the 
nation. We also have a significant amount going to export. We export 
about 20 percent of what we grow and, in 1997, our exports were valued 
at $6.7 billion.
    Six of California's top ten agricultural export markets are Pacific 
Rim countries. The leading export destinations for California 
agriculture are: Japan, Canada, Hong Kong and South Korea. Combined, 
these four markets import over $2.6 billion of California agriculture.
    Almost fifty percent of our cotton exports go to Japan and South 
Korea. Other products being exported to Asia--and other destinations--
include table grapes, wine, oranges, cattle and tomatoes.
    Clearly, what happens in Asia is going to have a profound impact on 
California's agricultural economy. Thus far, California exports--
including agriculture--have managed to avoid serious fallout from the 
Asian financial crisis, but the decline in trade with Pacific Rim 
countries will have a lasting impact if things do not turn around 
there. I read Mr. Collins' statement.
    On another note, before closing I would like to thank the 
Department for scheduling one of its regional forums on risk management 
in Fresno. I understand the forum is scheduled for later this month and 
I just wanted to express my gratitude for recognizing the level of 
concern in California. California faces a very unique situation in 
terms of the need for crop insurance reform. Only about one fifth of 
California's 250 types of crops are even eligible for federal 
insurance. I am pleased the Department understands this situation and 
is taking steps to hear input from California's growers. Please let me 
know if I or my office can provide you any assistance with the meeting.
    Thank you.

    Senator Cochran. Senator Durbin, we are interrupting our 
witnesses to take in the opening statements or comments that 
members of the subcommittee would like to make. I will 
recognize you at this time for that purpose if you would like 
to make any remarks.
    Senator Durbin. Mr. Chairman, I am going to make my 
statement a part of the record and not read it in the interest 
of time.
    Senator Cochran. OK. Thank you very much.
    Mr. Schumacher, you may proceed.

                  STATEMENT OF AUGUST SCHUMACHER, JR.

    Mr. Schumacher. Thank you, Mr. Chairman and your 
colleagues. Thank you for calling today's hearing. I am 
certainly pleased to be here with Keith. We have been speaking 
with each other fairly frequently on this difficult farm 
outlook that has come before us this year, continuing from last 
year.
    We have Under Secretary Michael Dunn with us today, Mr. 
Chairman, and also Under Secretary Miley Gonzalez. Also I am 
delighted that Pearlie Reed, Chief of the Natural Resources 
Conservation Service, is here along with the three 
administrators from my mission area. With your permission, I 
would like to call on them to answer some of the detailed 
questions you may ask. I believe there is an empty chair here 
so that any of these people can come forward. Or we can respond 
for the record.
    I am going to keep my remarks very short. With your 
permission, I would like to put my full statement in the 
record.
    Senator Cochran. That will be perfectly all right. We will 
make that a part of the record in full.
    Mr. Schumacher. Just to pick up from Keith's comments on 
the farm crisis, I think certainly the farm economy is not what 
we had in mind when we went through the 1996 Farm Bill.
    Baseline projections for farm prices and exports were quite 
different in 1996 than they are today, and I was running the 
Foreign Agricultural Service when exports reached nearly $60 
billion. I think we had some pretty good net cash farm income 
estimates.
    Many in agriculture anticipated growing world demand and 
higher prices, with farmers maximizing returns with some of the 
new planting flexibility the Farm Bill provided. The theory was 
that foreign markets would drive growth and that farmers would 
respond.
    But, unfortunately, as we have seen this year farm exports 
and prices have fallen for most of the heartland crops and 
certainly some of the livestock since 1996.
    We still are projecting long-term--long-term--growth in 
exports, but U.S. agricultural exports are now only projected 
at $49 billion for this fiscal year, 1999. They are not 
expected to reach the 1996 high of nearly $60 billion for 
another 5 years.
    Prices are not expected to recover significantly until 
exports do.
    Now this could all change if there are major weather 
problems in North China, Australia, Argentina, Brazil or, God 
forbid, in the United States. Things can be very cyclical, and 
the baseline assumes normal weather. But, as we have seen, 
weather is never normal. So we will have to see how the weather 
situation evolves.
    I would now like also to express my deep appreciation and 
gratitude to our employees who serve in our mission and who 
serve USDA widely. With this farm crisis upon us, these 
employees are really working very, very hard, during some very, 
very difficult times.
    I was down in your State 10 days ago and met many employees 
just to talk through some of the issues and visited a number of 
farmers. Things are not looking good.
    Let me just briefly touch on the supplemental request that 
is now here, delivered to both Houses of Congress by the White 
House last week.
    I understand Thursday, Mr. Chairman, the Senate is 
scheduled to mark up the bill to provide supplemental 
appropriations. The President's request includes $109.6 million 
to enable USDA to provide an additional $1.1 billion for 
financing to farmers and ranchers. The message that I am 
getting from the countryside is that we desperately need some 
additional credit, supplemental credit, out there.
    Our overall usage, as Keith has said, is up 65 percent. For 
most farm credit programs, funds have been exhausted or will be 
exhausted very shortly.
    It also includes--and this is a very important issue--$42.8 
million for Farm Service Agency temporary staff to meet the 
overwhelming demand not only for credit and servicing of credit 
but for all of the new LDP's--loan deficiency payments--that we 
are working on. We can come back to this in the question period 
to discuss how we are doing in issuing payments. I think you 
indicated in your opening remarks that you would like to hear 
more about that, and I would be very pleased to address that, 
maybe assisted by Keith Kelly and Parks Shackelford of FSA.
    But we certainly appreciate your very prompt action, coming 
up this week, Mr. Chairman, on this vital supplemental bill.
    Before I conclude, let me look a little bit at last year's 
highlights, again emphasizing the workload in the countryside.
    Let's take, for example, LDP's. Since July of 1998, those 
have gone up a thousandfold. In sheer numbers, we have gone 
from a little over 2,000 in 1997 to nearly 1.5 million in 
1998--in dollar terms, $2.8 million in 1997 to $2.8 billion in 
1998. This is an extraordinary increase in that safety net on 
LDP's.
    The number of farmers placing crops under loan also has 
gone up significantly. In addition to the marketing assistance 
loans, farmers have had the option to take 100 percent of their 
1999 flexibility payments beginning in November 1998, as 
provided by statutory change last year. Farmers have opted to 
receive about 60 percent of total estimated AMTA payments in 
advance.
    Now let's look at the emergency assistance about which you 
inquired.
    I am very pleased that within 10 to 12 days after the 
President signed your emergency bill last year, the $2.8 
billion was sent by bank draft or by check to farmers. So 
virtually all of that went out before Veterans Day. We worked 
very hard and the computer systems worked very well to get that 
$2.8 billion out very promptly.
    The signup for the $200 million Livestock Assistance 
Program, which began last November, was extended due to very 
heavy demand. Payments should be going out in early spring, 
very early spring.
    Signup for the $2.4 billion crop loss disaster assistance 
program began February 1 and was recently extended to April 9. 
Payments should go out in late spring, and I would be pleased 
to follow up on the details of that if you so wish.
    The Secretary will be making an announcement very soon on 
the $200 million Dairy Income Loss Assistance Program. The 
program implementation plan is working its way through 
clearance very quickly, because, as Keith said, the price of 
milk is going down. That program needs to be announced, and 
those payments will go out very shortly after the Secretary 
makes the announcement.
    Also, independently of the disaster bill, we have taken a 
number of actions to help pork producers. Secretary Dunn was 
very active in that, and he can comment further, if you wish, 
on the pseudorabies eradication. The signup for the Small Hog 
Operations Program ended February 12, and those checks should 
go out later this month.
    Then, finally, we will be implementing the commodity loan 
programs for mohair and honey.
    So there has been a major, major full court press to get 
assistance out.
    Let me just briefly touch on crop insurance and the export 
side before I conclude.
    In 1998, Federal crop insurance covered about 182 million 
acres under approximately 1.2 million policies covering 
liability of $28 billion.
    In 1998, we helped many farmers survive crop losses, 
whether it was in the Northern Plains, with the wetness, or in 
the Southern Plains with the drought in May and June of last 
year. It was the hottest and driest period on the historical 
record. We paid out about $1.6 billion, together with the 
private sector, on insurable losses.
    We have been aggressively promoting new programs. Ken 
Ackerman and his fine staff have been working with the private 
sector in expanding existing programs.
    Prior to 1996, no Federally backed revenue insurance was 
available to farmers. RMA now provides five different types of 
revenue insurance. Unfortunately, many farmers still remain 
uninsured or underinsured. As you well know, Mr. Chairman--we 
have discussed this--we developed and submitted a broad outline 
proposal for making crop insurance provide better coverage at 
more affordable prices. As a down payment under the disaster 
program, we rolled forward $400 million of that on the 
emergency relief package to reduce the insurance premiums to 
buy down the buy-up coverage by 30 percent.
    In addition, we have proposals that are coming forward, and 
there will be a number of hearings in the next week and the 
week after, both in the Senate and the House, on our risk 
management crop insurance. Those will be covering making higher 
loan crop insurance coverage more affordable, to expand the 
range of crops covered by insurance, to develop policies 
covering multi-year as well as single year losses, and to raise 
the floor on catastrophic and NAP coverage. That is certainly 
something the South has been hearing a great deal about. Also, 
more importantly, there is the implementing of a pilot revenue 
program for our livestock producers. Livestock covers a little 
over 50 percent of our total gross receipts and they are not 
covered very much by revenue. Also it should provide better 
information and training.
    We are looking very much forward to working with you, Mr. 
Chairman.
    Let me then just conclude on the international side.
    We have had a very active year, starting about a year ago, 
with the Korean GSM and the Asian crisis, when Tim Galvin and 
Chris Goldthwait, stepped smartly to the plate.
    Sales of U.S. commodities under our GSM have risen by 40 
percent, from $2.9 billion to over $4 billion. Certainly that 
got the attention of some of our competitors who had put some 
interesting press releases out about that activity.
    All told, we will ship nearly 10 million tons of food under 
our food aid authorities. And, as Senator Gorton mentioned, we 
are working very hard in getting ready for the next 
agricultural negotiations at WTO. We have a very ambitious set 
of objectives for this round.
    For fiscal year 2000, we have $3.5 million for the Cochran 
Fellowship, and that is working very, very well. We are 
expanding the program into Africa, which could be our new 
growth area in a few years' time.
    So, in conclusion, we are going to be asking for many 
comments as we work through the risk management proposals. It 
is true that we did not put much money in the budget for this 
because we want to get a consensus, similar to what we did in 
1990 and 1995 on the Farm Bill, where we built a consensus with 
farmers, ranchers, commodity groups, farm groups, farm 
organizations, and the authorizing committees, and then work 
through the budget implications as the year develops.
    It is going to be an active year. We are starting off with 
the tremendous work going on in the supplemental that is going 
forward, and I thank you for taking that up so promptly. We are 
then going to be finalizing all the payments that are coming 
out over the next 2 or 3 months. That should be all done by 
late May or the latest, late spring. Then we have the risk 
management proposals coming forward. Then we will have to see 
how the weather and prices continue and whether we need to do 
even more as we did last year.
    When farmers were in crisis, we all stepped up to the plate 
and assisted family farmers in getting through this crisis.
    Thank you very, very much, Mr. Chairman. I appreciate being 
here and look forward to answering your and your colleagues' 
questions.
    [The statements follow:]
              Prepared Statement of August Schumacher, Jr.
                              introduction
    Mr. Chairman and Members of the Committee, I am pleased to appear 
before you today with my colleague, USDA's Chief Economist Keith 
Collins, to discuss our assistance to producers and our commitment to 
improving the farm safety net. With me this morning are representatives 
from the Farm Service Agency, Risk Management Agency and Foreign 
Agricultural Service within my own mission area, as well as 
representatives from the Research, Education and Economics and 
Marketing and Regulatory Programs mission areas and the Natural 
Resources Conservation Service. Statements of the Agency Administrators 
detailing their fiscal year 2000 budget requests will be submitted for 
the record. The mission of Farm and Foreign Agricultural Services is to 
secure the long-term vitality and global competitiveness of American 
agriculture. The President described our mission another way in his 
State of the Union message when he said: ``We must work hard to bring 
prosperity back to the family farm.''
    Our ability to accomplish this mission is surely being tested 
during this period of low commodity prices and weak overseas demand.
    We will continue to use all of the program and policy tools 
available to us to help producers whose incomes have dropped 
substantially because of low prices and weather-related production 
losses. But while planting flexibility provisions of the Federal 
Agriculture Improvement and Reform Act of 1996 (the 1996 Act), strong 
export and trade policy programs, risk management initiatives, and our 
farm loan programs have helped many crop and livestock producers, it is 
clear that the farm safety net needs to be reinforced. This is a top 
priority.
    The Administration and Congress worked together last year to 
support farmers in areas hit hard by sharply lower commodity prices, 
severe weather problems, and, in some cases, successive years of 
reduced yields. This year we will continue our efforts to expand and 
improve programs which help producers manage risk, and we look forward 
to working with Congress to further reform the insurance programs for 
crop and livestock producers. We also are working hard to expand 
opportunities for small farmers and others who traditionally have been 
under-served in our farm programs. The recent class action settlement 
with African American farmers underscores our continued commitment to 
ensure fair treatment for all of our customers.
    The heavy workload associated with the farm crisis is putting 
increased stress on an already strained farm program delivery system as 
well. To improve service and cut costs, we are streamlining business 
processes, establishing a common computing environment, and 
consolidating administrative services among the county-based agencies. 
However, savings from these efforts won't be realized immediately. In 
the interim, it is vital that Farm Service Agency staffing be 
maintained at sufficient levels to ensure the efficient delivery of 
service to our customers on a timely basis.
    Mr. Chairman, before addressing our specific proposals for 
strengthening the farm safety net, I would like to describe recent and 
ongoing efforts underway by USDA to help America's family farmers and 
ranchers.
                      commodity program assistance
    As a result of the depressed market conditions in many grain and 
oilseed production areas, farmers' use of marketing assistance loans 
and loan deficiency payments (LDPs) has soared dramatically. The 
Commodity Credit Corporation (CCC) increased benefits under the 
commodity programs by allowing LDPs for silage and high moisture corn, 
as well as for below-grade or contaminated commodities.
    By the end of January, farmers had requested nearly 1.5 million 
LDPs for their 1998 crops--more than a 600-fold increase over the 2,182 
LDPs made on 1997 crops. Total marketing assistance loan gain (MLG) and 
LDP outlays on the 1997 and 1998 crops are now projected to total $3.1 
billion, with all but $165 million going to 1998-crop commodities. Corn 
producers have received 36 percent of the total to date, while soybean 
producers have received 23 percent, wheat producers 20 percent, and 
upland cotton producers 14 percent. For 1999 crops, total MLG and LDP 
outlays are forecast to rise to $4.2 billion.
    Putting these outlays into perspective, as of January 20, 65 
percent of the 1998 wheat crop (1,665.2 million bushels) had been put 
under loan or received an LDP. That's more than seven times the year-
earlier level, and more than six times the entire 1997-crop quantity 
covered by the program. Year-to-date activity is similarly large for 
other crops and reflects the extremely heavy county office workload.
    In fiscal year 1999, the value of loan placements and LDPs for all 
commodities is projected to total $10.6 billion, 38 percent more than 
in fiscal year 1998. In fiscal year 2000, that figure is forecast to be 
even higher at $13.2 billion, more than 70 percent greater than in 
fiscal year 1998. Of these totals, the increase in LDPs alone is 
demonstrative of the low commodity prices farmers are facing. LDPs for 
all commodities in fiscal year 1998 were under $500 million; in fiscal 
year 1999 they are projected to reach $1.8 billion, more than a three-
fold increase. For fiscal year 2000, LDPs are projected to be over $2.7 
billion, about six times the LDP total for fiscal year 1998.
    In addition to the marketing assistance loan program, farmers had 
the option to take 100 percent of their 1999 production flexibility 
payments (estimated at about $5.5 billion after adjustments for payment 
limits) beginning in November 1998. As of February 23 of this year, 
farmers had opted to receive about $3.7 billion, or about two-thirds, 
of this amount, leaving the remaining $1.8 billion to be paid later 
this year.
                           emergency programs
    USDA is working hard to implement the emergency programs funded in 
the 1999 Act, which include market loss payments, 1998 and multi-year 
crop loss assistance, livestock feed assistance, and other programs.
    Market loss payments of $2.8 billion--amounting to a 50-percent 
increase in 1998 production flexibility payments--were distributed to 
major crop producers before Thanksgiving. We are now developing program 
provisions for distributing $200 million in market loss payments to 
dairy producers this spring.
    Provisions of the $2.4 billion Crop Loss Disaster Assistance 
Program were announced last December, and signup began February 1. 
There are two basic parts of the program: 1998 single-year crop loss 
provisions cover crop losses during the 1998 crop year for which either 
crop insurance or the Noninsured Crop Disaster Assistance Program (NAP) 
is available; multi-year provisions provide an additional 25-percent 
payment to producers who have already received either crop insurance or 
NAP payments in at least 3 of the last 5 years. Producers may receive 
benefits under either, but not both, of these programs. The program 
also covers producers whose crops (primarily wheat) have suffered 
multiple outbreaks of fusarium head blight (scab). Up to $30 million in 
crop loss assistance and $12 million in disaster reserve funds will be 
used to assist farmers with crop and pasture land that has suffered 
long term flood damage.
    The Disaster Assistance Tree Loss Program covers the cost of 
replanting or rehabilitating trees from which crops are harvested that 
have been damaged by natural disasters during 1998. It will run 
concurrently with the Crop Loss Disaster Assistance Program. Growers 
who have received assistance for tree losses under the Tree Assistance 
Program (TAP) are not eligible to receive assistance under the new 
program; however, TAP assistance has been extended by the 1999 Act to 
cover trees and vines damaged by fire blight in addition to other 
natural disasters.
    Signup for the $200-million Livestock Assistance Program (LAP) 
began last November and has been extended due to heavy demands. County 
offices have been swamped with applications for this program. As of 
January 29, more than 23,000 producers have applied for assistance 
under this program in Texas alone. Nearly 1,200 counties have been 
approved for LAP. As of February 22, applications totalled well over 
$640 million, with many counties still processing applications. At the 
current application rate, we expect requested assistance could reach 
about $800 million by the end of the signup period. If this level of 
participation is realized, LAP payments would compensate producers for 
roughly 25 percent of their livestock grazing losses incurred during 
1998.
    FSA also has provided assistance to livestock producers under other 
appropriated programs, including the $4 million Livestock Indemnity 
Program (Phase II), which covered livestock death losses due to natural 
disasters which occurred before May 1, 1998, and the $6.8 million Dairy 
Production Disaster Assistance Program, which covers disaster-caused 
diminished milk production or dumped milk. The 1999 Act added $3 
million to this program.
    The American Indian Livestock Feed Program (AILFP) is funded from 
the sale of feed grains from the disaster reserve. It replaces an 
earlier and similar program, the Indian Acute Distress Donation 
Program, which was suspended by the 1996 Act. However, the need to 
assist American Indians has not diminished, and AILFP provides direct 
cash payments to eligible livestock owners. Tribes may apply as 
livestock owners, and as of February 10, two tribes--the Chippewa Cree 
Tribe of Rocky Boy's Reservation in Montana, and the Three Affiliated 
Tribes of Fort Berthold in North Dakota--have been approved. Payments 
have been issued, and applications from other tribes are now being 
reviewed.
    Since late 1998, USDA has taken several actions to help pork 
producers--who've seen hog prices fall 75 percent since July 1997--and 
improve market conditions. As announced by the Vice President, USDA 
will make $50 million in direct cash payments to family-sized hog 
producers and will provide $80 million under the pseudorabies 
eradication program to remove up to 1.7 million hogs from the market. 
Signup for the Small Hog Operations Payment Program ended February 12.
    We've also accelerated pork purchases for Federal feeding programs, 
increased pork purchases for the Russian aid package, and included pork 
in the package of export credit guarantees to South Korea. We're 
encouraging lenders to work with hog producers during the market 
downturn, and, in addition to credit assistance, USDA is prepared to 
use all servicing authorities, including rescheduling and reamortizing, 
deferring installments and debt writedowns to assist those producers 
who are FSA borrowers.
    CCC has issued $9.7 million under the Noninsured Crop Disaster 
Assistance Program to producers in 14 States for 1998 crop year losses. 
Since the 1995 crop year, NAP has provided risk protection similar to 
basic catastrophic crop insurance coverage for producers of uninsured 
crops. During 1995 and subsequent crop years, 1,108 NAP areas have been 
approved. To date, $16.0 million in NAP assistance has been provided to 
producers in 39 States and Territories for 1997 crop year losses; $60.9 
million has been issued to producers in 44 States and Territories for 
1996 crop year losses, and $30.5 million was provided to producers in 
45 States and Territories for 1995 crop year losses.
    Other 1999 emergency funds support new recourse loan programs for 
honey and mohair, for which procedures are being developed.
                           farm loan programs
    A big part of the safety net for farmers involves expanding 
economic opportunity, which includes access to farm credit resources. 
Traditionally, USDA's role in the farm credit market has been the 
``lender of last resort.'' However, the Department's role is important 
because it provides opportunities for farmers who experience financial 
difficulty to stay in business, and fills credit gaps, particularly for 
small, limited resource, socially disadvantaged and beginning farmers.
    The emergency provisions of the 1999 Act provide for an additional 
$541 million in direct and guaranteed operating loans to producers who 
are unable to obtain credit elsewhere.
    Demand for FSA farm loans in fiscal year 1999 has been extremely 
strong. Depressed farm prices and the natural disasters which affected 
producers in many parts of the country have led to a 65-percent 
increase in overall obligations compared to the same time last year. 
Many farm families who have been financing their business operations 
through their own resources or with a minimum of commercial bank debt 
are now seeking FSA farm loan assistance. As a result of the weakened 
farm economy, especially in the pork industry, these family farmers 
have lower incomes and reduced financial resources to work with this 
fiscal year.
    Commercial lenders are utilizing FSA loan guarantees to restructure 
the short-term indebtedness of their customers into more favorable 
long-term rates so that they can continue to provide financing. FSA has 
worked with lenders and other stakeholders to completely streamline 
loan guarantee application procedures, making them more consistent with 
standard industry practices and making the loan programs more user-
friendly and responsive to the needs of lenders and their farm 
customers. A new Preferred Lender Program (PLP) dramatically reduces 
the amount of time and effort lenders must spend in obtaining FSA 
guarantees by allowing lenders with PLP status the maximum authority 
possible to make and service guaranteed loans.
    Obligations under the guaranteed operating loan (OL) with interest 
assistance program are currently running 159 percent ahead of a year 
ago at this time, while the number of applications has increased 56 
percent. In the guaranteed farm ownership (FO) loan program, 
obligations have increased 92 percent, and applications by 28 percent 
over a year ago.
    Applications for direct operating loans are up 44 percent from last 
year at this time, and obligations under this program are running 35 
percent ahead of last year. We expect use of direct OL funds will 
accelerate as planting season nears. Economic conditions this year are 
forcing many family farmers who normally obtain commercial credit to 
seek direct OL assistance, and low commodity prices are creating severe 
stress for many highly leveraged small farms operated by minority and 
beginning farmers.
    Many direct OL loans are being made in conjunction with emergency 
(EM) loans to farmers affected by natural disasters. Applications for 
EM loans so far in fiscal year 1999 are running 397 percent above a 
year ago at this time, and obligations are running 185 percent above 
last year. The heaviest use of EM loan funds generally occurs in March 
through June. As is true for nearly all USDA direct loan programs, 
funding levels for direct FO loans have historically been less than 
farmers' demand for them. Many of these farmers are minority and 
beginning farmers who are without the resources to obtain credit from a 
commercial lender, even with a guarantee. As part of our ongoing 
commitment to improving our services to small farmers and to others who 
have been underserved in the past, USDA's fiscal year 2000 budget 
request includes $128 million in direct FO loans, compared to $86 
million available for 1999--a 48-percent increase. We also are 
increasing our outreach to previously underserved farmers. In fiscal 
year 1999, loans made to beginning farmers are up 32 percent and loans 
to socially disadvantaged producers are up 42 percent from a year ago. 
These increases mark the third consecutive year that we've increased 
the number of loans made to these groups of producers. However, 
providing loan funds to small farmers with limited equity and low 
incomes is only the first step in helping them to become successful. 
Many benefit from credit supervision, training, and assistance in 
managing their farm businesses. Currently, we are providing loan making 
and loan servicing benefits to these family farmers while achieving a 
declining delinquency rate on the overall FSA caseload. The default 
rate on FSA direct loans, as of January 1, has dropped from 23 percent 
in fiscal year 1995 to 15 percent this year.
    We are carefully monitoring the demand for FSA farm loans and the 
amount of loan funds obligated. In addition to the number of 
applications, we have a large carryover of unfunded applications from 
last year, and some States are reporting fund shortages in non-targeted 
loan categories (portions of loan allocations that are not set aside 
for beginning and minority farmers until after April 1, 1999) for 
guaranteed FO and OL loans with interest assistance. The statutory 
increase in loan limits to $700,000 also means the fiscal year 1999 
allocation of loan funds is able to fund fewer applications for 
guaranteed loans, even as these applications have increased 
dramatically. Because of the strong increase in demand for farm loan 
assistance, we anticipate that most funds will be exhausted much 
earlier than last year.
    Beginning farmer (BF) targets for guaranteed loans are lifted on 
April 1. The BF targets for direct OL are removed on September 1. 
Socially disadvantaged targets remain in effect until administratively 
withdrawn, and historically, this takes place in the latter part of the 
fiscal year.
                      conservation reserve program
    Many farmers also benefit from participation in the Conservation 
Reserve Program (CRP). Although CRP acreage is selected on the basis of 
the environmental benefits it will provide, conversion of the cropland 
to permanent vegetative cover does affect crop production, crop prices, 
and farmers' incomes.
    In the eighteenth CRP signup, which ended last December, USDA 
received 90,000 offers for a total of 7.1 million acres. County offices 
will soon be notifying producers of bid acceptances.
                            risk management
    In his State of the Union address, the President reiterated his 
call for a bipartisan plan to create a strong safety net for farmers. 
That need is critical. We need policy tools that can provide needed 
support to farm incomes when natural disasters and market disasters 
strike, tools that farmers can rely on in a proactive approach to risk 
management.
    The first step in building a stronger safety net is using $400 
million from the 1999 emergency appropriation as a down payment on 
improving crop insurance. That $400 million will be used to reduce 
farmers' premiums by 30 percent this year, as an incentive to increase 
the use of buy-up coverage, and to help energize a broad-based crop 
insurance program that will be the anchor for the safety net.
    In building on that base, we would like to work with Congress on 
some specific proposals, which include:
    Increasing participation by making higher-level crop insurance 
coverage more affordable and effective for farmers; developing policies 
to cover multi-year as well as single-year losses; raising the floor 
for catastrophic coverage and the Noninsured Crop Disaster Assistance 
program; expanding the range of crops that can be covered; authorizing 
a pilot revenue program for livestock as a first step to bringing the 
largest sector of American agriculture under the crop insurance 
umbrella; creating other new pilot options to see what works for 
farmers; working more creatively with private companies to develop risk 
management tools; and providing better information, education, and 
service to farmers.
    While we believe crop insurance should be the centerpiece of the 
safety net, we need to look at a broad range of ways to help farmers 
manage risk. These ways should include allowing farmers to extend the 
due dates on market assistance loans to ease the pressure on cash flow. 
They should include incentives for establishing on-farm storage 
facilities to give farmers greater marketing flexibility.
    In the next few months Secretary Glickman will hold three regional 
forums around the country; Deputy Secretary Rominger and I will hold 
others. We are inviting members of Congress to attend. We want to get 
input from all quarters, and to hear from farmers, ranchers, lenders, 
local officials--all who have a stake in agriculture--on how we can 
improve the safety net for producers. We want to hear directly from 
farmers and ranchers on what we need to do to make crop insurance a 
more attractive and viable vehicle in their risk management strategies.
    Crop insurance has come a long way since the 1994 reforms were 
enacted. In 1998, the program provided nearly $28 billion in protection 
on more than 181 million acres through nearly 1.2 million policies. 
Hard-hit producers received $1.4 billion in indemnities. That 
performance stands in stark contrast to the situation just 5 years 
earlier, when only 83.7 million acres were insured through 700,000 
policies providing $11.3 billion in liability.
    Now, there are a number of new insurance programs with improved 
coverages, including five different types of revenue insurance 
protection, new crop programs, and dairy options. Last year, the Risk 
Management Agency (RMA) responded to the acute farm crisis gripping 
much of the Northern Plains with improved and expanded crop and revenue 
insurance for spring wheat and barley, corn and soybeans.
    We intend to continue working on improving the crop insurance 
program. We will do everything possible to encourage program 
participation, to correct inequities in the structure of premium rates, 
yield guarantees, or other program provisions, to make the program 
user-friendly for companies and producers alike, and to facilitate new 
product development and other program innovations. We look forward to 
working with Congress on crop insurance reforms based on the principles 
of maximum participation, comprehensive coverage, use of market 
mechanisms, flexibility, and program delivery at the lowest possible 
cost to taxpayers and producers. Achieving these goals will provide a 
strong foundation for the reliable and effective safety net that 
producers need.
                            export programs
    Developments in overseas markets during the past year have 
certainly demonstrated that the health of the American farm economy is 
inextricably linked to the global economy. As markets in Asia, Latin 
America, Russia and elsewhere experienced financial turmoil and their 
imports of food and agricultural commodities were reduced, the impacts 
of those developments were felt throughout rural America. That is why 
the agricultural community worked so hard to ensure adequate funding 
for the International Monetary Fund, which is leading the international 
financial reform efforts.
    We recognize that a healthy farm economy depends on strong export 
markets and USDA is using all of its available export tools to help 
American farmers and ranchers weather this economic crisis. Faced with 
the challenges posed by last year's market disruptions, we have 
expanded substantially the level of CCC export credit guarantees made 
available for export to markets in Asia, which otherwise would have 
been unable to obtain financing for their food and agricultural 
imports. As a result, sales registrations under the guarantee programs 
exceeded $4 billion in 1998, an increase of 40 percent above the 
previous year.
    For fiscal 1999, we have announced the availability of $4.2 billion 
in export credit guarantees, compared with $3.9 billion announced at 
this time last year. This total does not include our anticipated $1 
billion program for South Korea. We are continuing our negotiations 
with the South Korean government over the commodity mix to be included 
in the package.
    In addition to these major undertakings, we also continue our 
export assistance efforts under other programs. For example, under the 
Dairy Export Incentive Program (DEIP), Secretary Glickman has 
authorized export bonuses up to the maximum volume and spending limits 
consistent with our World Trade Organization (WTO) obligations. From 
July through January, bonuses of nearly $80 million were paid for 
exports of nearly 70,000 metric tons of U.S. nonfat dry milk, over 
3,000 tons of whole milk powder, and 4,000 tons of cheese. Last May, 
Secretary Glickman reactivated the Export Enhancement Program (EEP) to 
announce a 20,210-ton allocation for frozen poultry to six Middle East 
countries to partly compensate U.S. poultry producers for markets lost 
in Europe. To date, 1,500 tons have been sold under this initiative. He 
also announced an EEP initiative for barley to Algeria, Cyprus, and 
Norway in response to the European Union's heavily subsidized sale of 
barley into the U.S. market. Before this initiative expired, USDA paid 
$1.2 million in bonuses for nearly 25,000 tons of U.S. barley exports. 
We continue to stress the importance of market development. In 1998, we 
allocated $90 million to 64 U.S. trade associations, state regional 
groups, and cooperatives for export promotion activities under the 
Market Access Program (MAP), and approved marketing plans for $33.5 
million for 27 U.S. trade associations under the Foreign Market 
Development (FMD) program. In 1999, we have approved marketing plans of 
$33.5 million for 26 U.S. trade organizations under FMD. Just last 
month, we invited applications for our 1999 MAP and our fiscal 2000 FMD 
program. We are using a new means this year to reduce U.S. wheat 
surpluses while increasing our food aid to other nations--the 
President's Food Aid Initiative, announced in July. This initiative is 
being carried out under authority of the CCC Charter Act of 1933 to 
purchase surplus wheat from the domestic U.S. market. The wheat is 
subsequently being made available for donation overseas under the 
authority of Section 416(b) of the Agricultural Act of 1949.
    By late October last year, we had fully allocated the 2.5 million 
metric tons of wheat and wheat products initially authorized. We 
doubled the size of the initiative in December, authorizing Section 
416(b) donations totaling 5 million metric tons. Wheat donations under 
the Food Aid Initiative alone will now equal the total commodity 
tonnage that the United States will provide worldwide this year under 
all other food aid programs.
    As of Jan. 30, 1999, allocations under the initiative totaled 
around 4.8 million tons of wheat and wheat products. Of the total, 3.3 
million has been allocated for government-to-government donations, 
including Russia (1.5 million tons), Bangladesh (600,000 tons) and 
Pakistan (300,000 tons), with the remaining 900,000 tons going to 16 
other countries. Another 1 million tons has been allocated for 
donations through the World Food Program, while 427,000 tons has been 
allocated for distribution by private voluntary organizations (PVO's).
    Shipments have begun to some countries, and we continue to 
negotiate donation agreements with a number of recipient countries and 
PVO's. We expect that all 5 million tons will be shipped by the end of 
this calendar year.
    We are also carrying out a major food aid effort in Russia. Along 
with the wheat that I mentioned earlier, our package for Russia 
includes 500,000 tons of corn, 300,000 tons of soybean meal, 208,000 
tons of soybeans, 116,000 tons of rice, 120,000 tons of beef, 50,000 
tons of pork, 50,000 tons of poultry, 39,000 tons of nonfat dry milk, 
and 15,000 tons of planting seeds. The U.S. and Russian governments 
have established an unprecedented monitoring program to ensure that aid 
reaches the targeted populations throughout Russia. USDA is devoting 
substantial resources to monitor the delivery and distribution of the 
food aid. Four additional USDA staff will be sent to Russia to aid in 
this effort. USDA also is requesting assistance from other U.S. 
government agencies to monitor the package and will, if necessary, 
consider sending additional staff.
                           trade negotiations
    We must move forward with greater market reform in the next round 
of world trade talks, which begins late this year in Seattle. Although 
the Uruguay Round was a landmark agreement for agriculture--more was 
done to liberalize trade and bring agriculture into the GATT system 
than in all previous rounds combined--we have to recognize that 
agriculture still has a long way to go to complete its reform and be 
fully integrated into the world trading system.
    Our goals for the upcoming WTO negotiations include: elimination of 
export subsidies; substantially cutting--and where possible 
eliminating--tariffs on farm products; tightening rules on domestic 
subsidies; reforming state trading enterprises; and tightening rules on 
technical barriers that unjustifiably restrict trade.
    WTO accessions provide an excellent opportunity to address and 
resolve some trade problems. We will be working with China on its WTO 
accession.
    In addition, we will continue to work to resolve the contentious 
bilateral trade issues that hinder our exports, such as the EU hormone 
ban, restrictive Canadian import policies for livestock and wheat, and 
unfair Chinese phytosanitary rules.
                               conclusion
    Mr. Chairman, that concludes my statement. I look forward to 
working with the Committee on the fiscal year 2000 budget so that 
together we can meet the needs of our nation's farmers and ranchers.
                                 ______
                                 
    Prepared Statement of Pearlie S. Reed, Chief, Natural Resources 
                          Conservation Service
    Mr. Chairman, thank you for the opportunity to appear before you 
today. For twenty-nine years I have served with the Soil Conservation 
Service and the Natural Resources Conservation Service. During the 
course of those years, I have had the opportunity to work with and meet 
many outstanding conservationists--people who care greatly for the land 
and for the farmers and ranchers that they serve. That is why I am here 
today. I want to represent the conservationists who go to work everyday 
to try and help our farms become more productive, to assist our 
communities be stronger and more sustainable, and to also protect and 
improve our land, water, and other valuable natural resources.
    Our people in the field are what NRCS is all about. They are some 
of the most capable and dedicated employees you will find anywhere in 
the government. However, these employees need our assistance, if they 
are going to be successful at what they do. They need us to help them 
spend time out on farms and ranches with the farmers, rather than 
performing administrative tasks in the office. They need us to provide 
the technical and financial resources that they can use to help 
farmers; they need us to tell their story, so that folks here in 
Washington will understand our successes--but more importantly, what 
their needs are.
    I want to begin with the topic of accountability. It is something 
that members of this Subcommittee have expressed very strongly to us. 
We got the message. As a result, during the course of fiscal year 1998 
we put several new accountability measures in place. One aspect is the 
Total Cost and Accountability System (TCAS). It measures, on a daily 
basis, the number of hours that employees spend on various functions, 
including conservation planning, watershed work, or assistance in Farm 
Bill program implementation. A second aspect of our accountability 
system is the Performance and Results and Management System (PRMS). 
This system focuses on measuring the results of our work and capturing 
accomplishments. Although PRMS is just coming on-line, we believe it 
will be a useful tool in meeting the objectives of the Government 
Performance and Results Act (GPRA).
    A third component is the Workload Analysis. At the state and field 
office levels, data were collected about the expertise of our employees 
in geographic areas of the country, how programs were utilized to 
achieve objectives, and what our future projected workload would be. 
The Workload Analysis aids NRCS strategic planning, in that we can set 
targets and match objectives to realistic resources and staffing. 
Initial results suggest that we need more help in the field to assist 
with program implementation and meet the needs of farmers. As Chief, I 
have taken many steps to minimize administrative tasks, and help 
conservationists spend time in the field. My ``workload reduction 
team'' has recommended and implemented many steps, such as eliminating 
unneeded forms and reports, that cost valuable staff time. For example, 
in Yolo County, California, commonly requested soil survey data is now 
available on the Internet and has reduced requests to the office; in 
New Mexico, many forms have been automated and streamlined, reducing 
staff workload; and in Texas, elimination of the Field Office Computing 
System (FOCS) has made more time available for field staff to meet with 
customers. We are pleased with the results of workload reduction, but 
regardless of the steps we take here in the leadership, we need 
sufficient resources to apply toward meeting the incoming workload.
    We know the workload is great. For nearly 30 years, I have seen the 
people of NRCS eagerly and consistently go above and beyond the call of 
duty. We see every citizen who walks in an NRCS office as our customer. 
Some have criticized NRCS for this. I believe it is something to be 
proud of. NRCS staff are part of the communities they serve and the 
most impressive achievements of our agency, are where our field 
conservationist help people to help themselves. It is through the 
relationship that our field staff develop with individual farmers, or 
through the role they play in helping communities, that they have 
developed trust and a reputation for providing quality advice time and 
time again. Some call it ``locally-led'' or a ``bottom-up'' approach, 
but our work really comes down to ``interactive assistance''. NRCS 
staff interact with customers: we want to know what the farmer's 
objectives are; we gain an understanding for how the operation is run; 
and we work with them to apply conservation practices that will achieve 
their goals. We also strive to achieve national goals of clean water, 
erosion control, nutrient management, among many others. We do all of 
this based upon sound science and utilization of the best technology 
available. It is an interactive process and it may take weeks, months 
or even years to put all of the pieces together and it is also very 
difficult to quantify.
    Demands for NRCS' services continue to grow at an accelerating 
pace. In recent years, the need and demand for Conservation Technical 
Assistance (CTA) has increased as resource problems have been 
identified, including those associated with nonpoint source pollution, 
misapplication of fertilizers and pesticides, and land use changes. 
NRCS has responded by developing new technology and conservation 
standards to address emerging challenges such as nutrient management, 
wetland destruction, global climate change, the aging watershed 
infrastructure, and soil erosion. While this has increased public and 
local awareness of natural resource concerns, it has also broadened the 
agency's customer base to include a growing list of customers. We 
estimate that the operators of livestock operations will require over 
350,000 nutrient management plans in the coming decade for the 
estimated 450,000 AFOs addressed by the Clean Water Action Plan. In 
addition, almost 11,000 small watershed dams constructed under the 
authority of Public Law 534, and Public Law 566 will reach the end of 
their design life in this coming decade. These watershed structures 
represent the safety, economic viability, and economic sustenance of 
thousands of communities. In defense terms, we often speak of 
``military readiness''. What I would ask us all to do today, is think 
about the ``readiness'' of our conservation delivery system.
    The people of NRCS have always given 100 percent of their abilities 
and will continue to do so. The 1985 Farm Bill asked them to 
concentrate more efforts on highly erodible lands, and they met that 
responsibility. The 1990 Farm Bill asked them to work harder for 
America's wetlands, and they also met that responsibility. The 1996 
Farm Bill asked them to work harder for wildlife habitat, farmland 
protection, animal agriculture and a host of other activities. They are 
working hard to meet that responsibility, but they need our help.
    I want to suggest, in closing, that the reason that so much is 
being asked of NRCS is that so much is being asked of our nation's 
farmers and ranchers. Everyday, they put their boots on and go out to 
bring us the lowest cost, safest, and most abundant food supply on this 
planet. At the same time, we ask them to be the caretakers of our 
water, guardians of our air, and the stewards of the soil. It is up to 
us to give them a hand.
                                 ______
                                 
   Prepared Statement of James R. Lyons, Under Secretary for Natural 
                       Resources and Environment
    Mr. Chairman, Members of the Committee. It is my pleasure to 
outline for you the fiscal year 2000 budget request for the Department 
of Agriculture's Natural Resources Conservation Service (NRCS). Over 
the past six years I have had the honor to appear before this 
Subcommittee during each appropriations cycle to present the budget for 
NRCS. In reviewing the budget requests for the agency in those years, 
it is quite startling to see how the agency has changed and emerged as 
a leader in Federal conservation activities. Through passage of the 
federal Agriculture Improvement and Reform Act of 1996 (1996 Farm 
Bill), and implementation of the Department of Agriculture 
Reorganization Act of 1994, NRCS has stepped up not only to advance the 
conservation mission of USDA, but also to become the central Federal 
agency for conservation on America's private lands.
    Farmers, ranchers, and communities across the nation can turn to 
NRCS and receive assistance on a wide spectrum of conservation, 
encompassing nutrient and pesticide management, wetlands conservation, 
watershed planning, flood prevention, water quality improvement, 
development/maintenance of wildlife habitat, and, of course, soil 
conservation. To meet that demand, NRCS delivers a wide variety of 
financial and technical resources to its customers, through programs as 
diverse as the Wetlands Reserve Program, Wildlife Habitat Incentives 
Program, and the Farmland Protection Program.
    But regardless of the programs that NRCS delivers and the 
responsibilities with which the agency has been entrusted, the core of 
NRCS has been and continues to be its people. It is the NRCS delivery 
system in the field that makes all of the work happen. It is the field 
conservationists who combine knowledge of the latest technology and 
science, with experience in farming and ranching operations to sensibly 
apply good conservation management practices. It is the field 
conservationists who have earned the trust of farmers and ranchers 
across the nation through that sound advice and assistance.
    I want to take a moment to outline in more detail, how the NRCS 
field delivery system provides the conservation technical assistance 
necessary to meet the agency's mission.
      natural resources conservation service technical assistance
    NRCS provides natural resources conservation assistance primarily 
on private lands. More than 70 percent of the land in the contiguous 
United States is privately owned, including virtually all of the 
Nation's agricultural lands. It is on the private lands where millions 
of individual decisions are made by farmers and ranchers, that the 
ultimate success of our natural resource efforts will be determined. 
NRCS is the only Federal agency whose major purpose is to provide 
conservation technical assistance to private landusers across the 
country. The agency's focus is on helping landowners and users achieve 
natural resource and environmental goals while maintaining productive 
and profitable operations and economically viable rural communities. 
NRCS has had significant success, and the field structure is designed 
to continue that success in the future. These are a few of its many 
assets:
    People.--NRCS has a nationwide network of professional staff at the 
local level that provide conservation technical assistance to owners 
and users of privately-owned land. NRCS field staff areas of expertise 
cover a broad spectrum of natural resource issues. Over forty percent 
of the agency's science and technology occupations are engineers, over 
25 percent are soil scientists, and nearly 10 percent are schooled in 
rangeland sciences. Other disciplines encompass biology, agronomy, 
cartography, physics, and forestry. NRCS field staff live and work in 
the areas that they serve, and have invaluable knowledge of the soil 
resources, watersheds, climate, and wildlife in the area. But even more 
importantly, our field staff know their customers. They interact with 
them everyday and understand the farming operations, agricultural 
trends, and resource constraints of the people they serve.
    Technical skills.--NRCS natural resource specialists are trained to 
deliver technological support to groups and individuals quickly, 
efficiently, and consistently nationwide. Through a national framework, 
including science and technology consortiums as well as NRCS 
Institutes, field staff are trained to apply science-based assistance 
with a great degree of sensitivity to local conditions. NRCS field 
staff working in partnership with the local conservation districts are 
used as a primary source of help by local people--and often by people 
administering programs for other Federal, State, and local agencies.
    Technical excellence.--NRCS specifications for soil and water 
conservation practices are considered invaluable throughout government 
and private industry. In addition, the agency is the leader in soil 
classification and soil mapping. NRCS soil surveys and GIS-based data 
are utilized daily not only by NRCS staff, but other Federal agencies, 
local governments, and academia. Soil surveys are used daily to make 
decisions as small as what type of plants to place in a backyard 
garden, to how best to engineer highways and bridges.
    Natural resource planning experience.--NRCS has vast experience in 
broad-scale planning in watersheds and other areas and site-specific 
planning on farms and ranches to address natural resource concerns. 
Effective natural resource planning in the future will require this 
type of planning process to develop effective solutions that meet the 
needs for a sustainable land and its people. NRCS serves as a catalyst 
by providing coordination to bring local people together with skilled 
technical people to develop and implement meaningful solutions. These 
planning efforts are provided through the Watershed Survey and Planning 
Program, the Resource Conservation and Development (RC&D) Program, and 
Coordinated Resource planning provided through Conservation Operations.
    Diversity.--I would like to underscore the contributions that NRCS 
is making toward ensuring equitable service and opportunity for all 
customers and employees of USDA. NRCS has had a good record of ensuring 
diversity and opportunity in the past, however, I believe we can do 
better. Throughout various program and technical assistance activities, 
NRCS will work hard to provide the necessary outreach and assistance to 
ensure that our customers have easy access to services. In response to 
the Civil Rights Action Team report, the Secretary has undertaken many 
steps to improve the Department's activities and policies in this area. 
I am confident that NRCS will continue to seek proactive ways to better 
serve minority and low-income customers. One of the hallmarks of the 
conservation assistance is that it is available to anyone, anywhere. 
That includes areas that are not typically designated as high workload 
areas based upon farm program participation, population, or other 
demographic factors. By offering basic and universal conservation 
assistance on a national basis, NRCS offers minority and limited 
resource farmers a needed helping hand. A legacy of conservation on 
private lands must be built with the participation of everyone.
    Partnerships and volunteerism.--Since its creation, NRCS has 
operated through voluntary cooperative arrangements with individuals, 
the private sector, and Federal, State, and local governments. The 
value of NRCS technical assistance is recognized by local and State 
partners; equally, we recognize the invaluable contribution of 
volunteers, who contribute immeasurably to conservation efforts. 
Americans have freely and generously given of their time to the 
volunteer arm of NRCS, known as the Earth Team. In fact, in fiscal year 
1998 some 17,287 NRCS Earth Team volunteers donated 674,299 hours to 
conservation efforts. As calculated by the Points of Light Foundation, 
this equates to an additional $9,200,000 in direct assistance to 
private landowners for natural resource protection, an increase of 
nearly 11 percent from fiscal year 1997. The return on the investment 
for NRCS is enormous. We estimate that for every dollar spent on the 
Earth Team, we receive $48 dollars in service benefits.
    Local people as decision-makers.--When NRCS provides conservation 
and program assistance, the agency works under mutual agreements with 
some 3,000 conservation districts that are established under state law. 
About 17,000 local conservation district supervisors provide the agency 
with invaluable guidance. The NRCS cooperative team structure is an 
established and practical example of how Federal programs can be 
managed with local guidance at the local level. It is crucial to 
remember that the agency's approach is a voluntary one. Our 
professionals provide options for problem-solving--developed in 
conjunction with customers, but it is the customers who make the final 
decisions.
    Leverage.--State and local governments contribute substantially, 
with both people and dollars complementing NRCS technical assistance. 
Without NRCS technical assistance, which greatly enhances the value of 
State and local efforts, these funds almost certainly would not have 
been spent on natural resource protection. In a sense, this cooperation 
constitutes a two-way leveraging: State and local programs and NRCS 
benefit from each other's involvement.
    We are asking a lot from our field delivery system. And as we look 
at how the agency has evolved to assist in so many areas of 
conservation, it has accomplished more despite decreasing numbers of 
employees nationwide. To a great degree, we have taken every step 
possible to ensure that reductions would not come at the expense of 
field services. As a result, the agency still maintains over 75 percent 
of its staff in the field. However, those staff are under increased 
demand for their time and expertise. Chief Pearlie Reed is working to 
minimize administrative functions, so that field staff can dedicate 
their time where it is needed most--on farms and ranches across the 
countryside. But as workload increases and our customers demand more 
services, we need to provide additional staff resources to help the 
agency meet that demand. Having said that, I will describe our programs 
and plans for fiscal year 2000.
    The following table shows the major items in this year's budget 
request:

                        [In thousands of dollars]
------------------------------------------------------------------------
                                               Fiscal year--
                                  --------------------------------------
                                       1998         1999         2000
------------------------------------------------------------------------
          Appropriation
 
CONSERVATION OPERATIONS..........      633,231      641,243      680,679
WATERSHED SURVEYS AND PLANNING...       11,190       10,368       11,732
WATERSHED AND FLOOD PREVENTION         181,036       99,443       83,423
 OPERATIONS......................
DEBT FOR NATURE..................  ...........  ...........        5,000
RESOURCE CONSERVATION &                 34,377       35,000       35,265
 DEVELOPMENT.....................
FARMLAND PROTECTION PROGRAM......  ...........  ...........       50,000
 
           CCC Funding
 
WETLANDS RESERVE PROGRAM (WRP)         193,597      127,870      207,065
 \1\.............................
WILDLIFE HABITAT INCENTIVES             30,000       20,000       10,000
 (WHIP)..........................
ENVIRONMENTAL QUALITY INCENTIVES       200,000      174,000      300,000
 PROGRAM (EQIP)..................
FARMLAND PROTECTION PROGRAM (FPP)       18,000  ...........       27,500
------------------------------------------------------------------------
\1\ Does not include technical assistance costs funded from unobligated
  WRP appropriation balances; fiscal year 1998--$18.7 million; fiscal
  year 1999--$4 million; fiscal year 2000--$2 million.

    CONSERVATION OPERATIONS is the foundation for most of the agency's 
activitiesies. Conservation Operations represents a long-standing and 
historical partnership of interests all working in a concerted effort 
toward a sustainable and productive nation. The following programs and 
initiatives are funded through Conservation Operations:
    CONSERVATION TECHNICAL ASSISTANCE is the cornerstone for most 
agency activities. The fiscal year 1998 appropriations were 
$541,361,000; and the fiscal year 1999 comparable appropriation is 
$547,905,000. The fiscal year 2000 budget request is $585,000,000 or a 
$37 million net increase.
    The proposed funding levels represent support to the functions and 
activities that are vital to meeting the mission of conserving, 
improving, and sustaining our natural resources for the future. 
Conservationists on the ground are under increasing demand for their 
services, as they tackle new programmatic responsibilities while 
retaining a commitment to the community for providing basic assistance 
to landowners in need. It is our goal to ensure NRCS staff support to 
grassroots watershed partnerships and the development of conservation 
plans for communities. Throughout the nation, NRCS conservationists 
facilitate and enable local action. Technical assistance funding 
ensures the presence of these individuals and promotes voluntary 
conservation.
    We have also responded to requests of this Subcommittee and others 
for additional data on our accomplishments and workload within 
Conservation Operations. I am pleased that NRCS has begun to implement 
accountability systems to capture the total cost of workload in various 
areas. Also, we are creating a sound system for measuring performance 
and quantifying the degree to which we are meeting our stated goals.
    With respect to workload, one area of particular concern is the 
issue of water quality problems associated with animal feeding 
operations (AFO's). In September , 1998, as called for in the 
Administration's Clean Water Action Plan (CWAP), USDA and the 
Environmental Protection Agency (EPA) jointly released for public 
comment a draft AFO Strategy that establishes national performance 
expectations for all AFO owners and operators. The strategy presents a 
series of actions that USDA and EPA will take to minimize the water 
quality and public health impacts of the nearly 450,000 AFO's in the 
United States. Thousands of producers will likely request nutrient 
management assistance. In order to help them develop effective nutrient 
management plans that protect our Nation's water resource, the fiscal 
year 2000 budget proposes to increase the amount of conservation 
technical assistance available to AFO operations by $20 million.
    Recognizing that NRCS can never fully meet this workload, the 
proposed funding level for Conservation Operations also represents a 
continued cooperative effort between NRCS and its conservation partners 
including Conservation Districts, Resource Conservation and Development 
Councils, and other non-profit and community action groups. The 
relationship between NRCS and its partners represents a catalyst that 
empowers local people to become involved in conservation activity. In 
addition, the funds that are appropriated by Congress are leveraged and 
matched by the hard work and resources of the thousands of partners and 
volunteers in virtually every aspect of NRCS operations. Additional 
support for the CWAP in the budget request includes $20 million for 
Competitive Partnership that will be used to strengthen the leadership 
of locally-based organizations such as conservation districts or 
watershed councils, to enable them to provide coordination of locally-
initiated conservation efforts. Finally, a further increase of $3 
million will be used by NRCS for additional monitoring to help target 
resources and document baseline conditions and performance.
    Another area of increasing concern is the issue of Global Climate 
Change. As the Administration and Congress work toward international 
protocols concerning greenhouse gas emission, farmers and ranchers can 
play a key beneficial role. Preliminary research indicates that sound 
conservation practices, such as wetland protection, conservation 
tillage, conservation buffers, as well as planting biomass covers have 
the potential to dramatically reduce greenhouse gas levels. We want to 
learn more about this, and the proposed Conservation Technical 
Assistance increase includes $12 million for soil studies and 
inventories to provide accurate baseline soil carbon data and to assess 
the impacts of Federal programs on soil carbon stocks. Also, $3 million 
is proposed to fund demonstration and pilot projects to test various 
carbon sequestration and greenhouse gas mitigation strategies and 
monitoring mechanisms.
    These increases are partially offset by a decrease of $31 million 
for a transfer of base funding to the proposed Support Services Bureau, 
which will centrally fund the administrative support services common to 
the county-based agencies. The fiscal year 2000 Budget requests $74 
million for the Support Services Bureau's information technology and 
Common Computing Environment functions. In fiscal year 1999, $31 
million for similar activities was appropriated to NRCS. In addition, 
$16 million will be made available from CCC, and transfer authority is 
requested to merge the agencies' central administrative costs into this 
common account. Estimates of the amounts to be transferred from FSA, 
NRCS, and RD for administrative services are not yet available.
    Some other activities that are encompassed by Conservation 
Technical Assistance Include the following:
    Highly Erodible Land Conservation (HELC).--The 1996 Farm Bill 
provided amendments that have made HELC compliance requirements more 
farmer friendly and have provided USDA with additional options in 
assisting producers with compliance status, reduced the burden of 
complying with the HELC provisions and have provided USDA with 
additional tools to use in working with producers. However, all 
producers who receive USDA program benefits must fully apply a 
conservation plan or use an approved conservation system on highly 
erodible land. Therefore, NRCS continually assists producers in 
developing plans for land that they acquire and in making changes in 
their current plans so that their practices may reflect changes in 
cropping systems, weather conditions, new technology, and economic 
incentives. Our experience has shown that approximately 20 percent of 
producers will change their conservation systems each year.
    Wetland determinations and certifications.--The 1996 Farm Bill 
changed Swampbuster to give farmers greater flexibility in complying 
with wetland conservation requirements by providing more options for 
mitigation and wetland conversions. NRCS determines areas subject to 
Swampbuster and responds to requests from farmers who plan activities 
that may adversely impact wetlands. NRCS certifies wetland 
determinations only upon request when clients propose a project to 
alter the hydrology within wetlands. Responding only on a request basis 
was provided for in the 1996 Farm Bill and ensures that requests from 
clients are serviced in a timely manner and that certifications are 
conducted where absolutely necessary. Certified determinations stay in 
effect as long as the land is used for agricultural purposes or until 
the owner or operator requests a review after natural events change the 
topography or hydrology of an area. Certified wetland determinations 
are conducted by NRCS on agricultural lands and non-agricultural lands 
for USDA program participants. Generally, these NRCS certified wetland 
determinations are also valid under Section 404 of the Clean Water Act. 
In fiscal year 1997 and fiscal year 1998, landowners requested about 
40,000 certified wetland determinations annually and these requests are 
expected to increase.
    Aside from wetland determinations, changes initiated by the 1996 
Farm Bill have increased the activities of NRCS in wetland mitigation. 
NRCS provides assistance to landowners who wish to enhance functions of 
existing wetlands, restore former wetlands, and create new wetlands to 
replace wetland functions lost from planned conversions or alterations. 
These options, while creating increased opportunity and flexibility for 
landowners, require a great deal of work by NRCS field staff, who 
assess the functions of individual wetlands and provide the customer 
with technical assistance in every phase of the mitigation process. 
Other changes by the 1996 Farm Bill requires development of categorized 
minimal effect exemptions and also revises the concept of abandonment. 
When done under an approved conservation plan, landowners with farmed 
wetlands and farmed wetland pastures may allow an area to revert to 
wetland status and convert it back at a future date without violating 
Swampbuster. Thus far, interest and participation in these wetland 
activities has been widespread among landowners. While NRCS welcomes 
the opportunity to provide additional assistance to these landowners, 
these provisions have resulted in a marked workload increase for NRCS.
    Grazing Land Conservation Initiative (GLCI).--This grassroots-
driven initiative has helped NRCS better define the resource needs and 
benefits generated when grazing lands are improved. NRCS has been 
requested to continue technical assistance to livestock producers on 
private grazing lands. Grazing lands include rangelands, pasture, 
hayland, and grazed forestlands.
    Natural Resources Inventory (NRI) analysis of range vegetation 
shows that over 15 percent of non-Federal rangelands are in poor 
condition; over 44 percent are in fair condition; 34 percent in good 
condition; and only 6 percent in excellent condition. The NRI indicates 
that 75 percent--nearly 299 million acres--of non-Federal rangelands 
need conservation treatment. Properly managed grazing land represents a 
renewable resource for producing food and fiber. Vegetative cover on 
well-managed grazing lands contributes to: (1) increased water quality 
and quantity; (2) improved wildlife habitat; (3) reduced soil erosion 
and sedimentation; and (4) improved riparian areas.
    In fiscal year 1999, NRCS was able to continue support for a 
Grazing Land Conservation Coordinator position in each of the fifty 
states. This position helps us to provide multi-resource technical 
assistance to support grazing lands conservation and water quality 
improvement on rangelands and begin the process of rebuilding the 
agency's expertise in rangeland conservation, a capability demanded by 
our customers.
    Urban Conservation.--Another area of attention has been the work of 
NRCS in urban and suburban conservation. Natural resources do not 
recognize the boundary between urban and rural areas and to ignore 
their interaction within a watershed would not do justice to either. 
The watershed approach to resource conservation has been widely 
acclaimed and highly successful. However, when we begin to examine and 
work to rehabilitate the health of a watershed we must include all 
contributing factors that may be present, including community and 
residential elements. The efforts of NRCS are aimed to improve water 
quality and protect our natural resources while maintaining and 
enhancing production. The demand for assistance with issues such as 
water quality and soil erosion prevention are matters that effect 
everyone, and workable solutions must include the participation of 
everyone. NRCS has had great success in utilizing the science and 
technology that it has gained in its 60 year history to all types of 
resources in many settings. Likewise, the expertise in soil and water 
quality that the agency has gained is well suited and easily applied to 
help communities realize their goals for ecosystem health. We will 
continue to work together as neighbors to achieve actual goals.
    Snow survey and water supply forecasts provide western states and 
Alaska with vital information on summer water supplies. The fiscal year 
1998 appropriation was $5,835,000, the fiscal year 1999 appropriation 
was $5,990,000; and the fiscal year 2000 request is $6,124,000. NRCS 
field staffs provide necessary leadership, standardization of 
procedures, and automation to a partnership of Federal, State, and 
local personnel to collect snow-pack data from more than 1,200 remote 
high mountain sites. After compiling and analyzing the data, NRCS is 
able to provide snowpack estimates and water yield on a monthly basis 
throughout the snow melting period. The knowledge gained through this 
effort supports critical decisions on billions of dollars of 
agricultural production, municipal water supply, hydroelectric and 
industrial water supply, flood control, and water flow requirements for 
fish and wildlife. This modest program contributes substantially to the 
economic and environmental well-being of a very large part of the 
country.
    Soil Surveys provide the public with local information on the uses 
and capabilities of their soil resources. The fiscal year 1998 
appropriation was $76,409,000; the fiscal year 1999 appropriation is 
$78,323,000; and the fiscal year 2000 request is $80,565,000. Soil 
surveys are based on scientific analysis and classification of soils 
and are used to determine land capabilities and conservation treatment 
needs. The published soil survey for a county or designated area 
includes maps and interpretations with explanatory information that is 
the foundation of resource policy, planning and decision-making for 
Federal, State, county, and local community programs. Homeowners and 
landowners also use soil survey information when making decisions. Soil 
surveys are conducted cooperatively with other Federal agencies, land 
grant universities, State agencies, and local units of government, many 
of whom contribute funds and staff.
    Soils information has been gathered over many years and is 
primarily contained in published soil survey manuscripts and maps. 
There is a need for digital soils data for use in geographic 
information systems (GIS). NRCS has the leadership role for 
coordinating the development, maintenance, and distribution of a 
modernized digital soils data base. Geographically referenced digitized 
soil survey data, along with orthophotography will provide the accurate 
reference base needed for computer-assisted conservation, natural 
resource planning, and for geographic referenced data sharing. In 
addition, digitizing the soil surveys provides efficiency when updating 
and maintaining the soil survey data.
    Plant Material Centers assemble and test plant propagation and the 
usefulness of plant species for biomass production, carbon 
sequestration, erosion reduction, wetland restoration, water quality 
improvement, stream bank and riparian area protection, coastal dune 
stabilization, and to meet other special conservation treatment needs. 
The Plant Materials Centers also focus on the important role of native 
species in ecosystem functions. The fiscal year 1998 appropriation was 
$8,825,000; the fiscal year 1999 appropriation is $9,025,000; and the 
fiscal year 2000 budget request is $9,238,000. Plant materials 
represent inexpensive, long-term conservation solutions to many 
environmental and natural resource problems and their maintenance costs 
are usually low. Many landowners and managers willingly use plant 
materials, if available, to meet their conservation needs.
    The work at the 26 centers is carried out cooperatively with State 
and other Federal agencies, commercial businesses, and seed and nursery 
associations. Plant Materials Centers play an important research and 
development roles since most commercial nurseries will not develop new 
plant materials due to limited markets, but will grow and market the 
stock once a dependable plant has been developed. After species are 
proven, they are released to the private sector for commercial 
production.
    Following are the other appropriated discretionary accounts in the 
NRCS Budget:
    Watershed Surveys and Planning.--NRCS works with local sponsoring 
organizations to develop plans on watersheds dealing with water 
quality, flooding to develop plans on watersheds dealing with water 
quality, flooding, water and land management, and sedimentation 
problems. These plans then form the basis for installing needed works 
of improvement. The agency also works cooperatively with State and 
local governments to develop river basin surveys and floodplain 
management studies to help identify water and related land resource 
problems and evaluate sound solutions. For fiscal year 2000, this 
activity is proposed to be funded at $11.7 million.
    WATERSHED AND FLOOD PREVENTION OPERATIONS is the first and only 
national program that helps local organizations plan and install 
watershed-based projects on private lands. It provides site-specific 
technical expertise and locally based watershed planning and financial 
assistance for plan implementation. The Watershed Program provides a 
process to solve local natural resource problems and avoid excessive 
regulation. fiscal year 1998 funding for Public Law 534 and Public Law 
566 was $101,036,000; the fiscal year 1999 funding level is 
$99,443,000; and the fiscal year 2000 request is $83,423,000. The 
authorized purposes of watershed projects include watershed protection, 
flood prevention, water quality improvements, soil erosion reduction, 
irrigation water management, sedimentation control, fish and wildlife 
habitat enhancement, wetland creation and restoration, and public 
recreation. The program empowers local people as decision-makers, 
builds partnerships and requires local and State funding contributions 
and ownership.
    The funding request for fiscal year 2000 also includes $1 million 
to educate the public about the condition of the aging infrastructure 
installed under our watershed programs. NRCS has assisted project 
sponsors to install over 15,000 individual measures since 1944. An 
integral part of many of these projects was structures for flood and 
water control, municipal and industrial water supply, and recreation. 
Since their installation, conditions surrounding the structures have 
changed due to an increase in population, residences built below the 
structures, upstream land use changes, and changed Federal and State 
dam safety regulations. By fiscal year 2000, approximately 2,000 of the 
aging structures could require significant restoration.
    Debt for Nature.--The fiscal year 2000 budget includes $5 million 
as proposed legislation to help implement the Debt for Nature program. 
Debt for Nature provides technical and financial assistance to USDA 
borrowers with cash flow problems, who also have lands that require 
conservation treatment. In exchange for debt forgiveness on their 
lands, program participants agree to enroll environmentally sensitive 
lands into conservation easement. USDA's Civil Rights Action Team 
recommended that the program be implemented. The USDA farm loan program 
has a significant number of limited resource borrowers who have a high 
debt load and tight cash flow situation. The Debt for Nature program is 
a win-win, in that it offers direct financial assistance to borrowers, 
and also provides the public with protection of valuable natural 
resources. The program will work to mitigate the adverse economic 
implications of the ailing farm economy in many communities. The 
proposal will also directly facilitate the reduction of soil erosion, 
the implementation of the conservation buffer initiative, and the 
conservation of diminished and other important fish and wildlife 
habitat.
    RESOURCE CONSERVATION AND DEVELOPMENT (RC&D) is a program initiated 
and directed at the local level by volunteers. The fiscal year 1998 
appropriation was $34,377,000; the fiscal year 1999 appropriation is 
$35,000,000; and the fiscal year 1999 budget request is $35,265,000. 
This increase of $265,000 represent pay cost increases.
    Each RC&D area encompasses multiple communities, various units of 
government, municipalities, and grassroots organizations. The RC&Ds 
represent a creative approach for helping citizens address multi-
jurisdictional natural resource and community development issues. NRCS 
provides coordination to the program which serves as a catalyst for 
these civic oriented groups to share knowledge and resources, and it 
leverages public and private funds to solve common problems--including 
economic development--in a given area. Assistance is obtained from the 
private sector, corporations, foundations, and all levels of 
government. Historically, every dollar of NRCS technical and financial 
assistance for this program and applied directly to local projects, has 
been matched by about $13 from other sources. By fostering local 
ownership and self sustenance for conservation and rural development 
projects, we believe that RC&D will contribute greatly to the legacy of 
locally-led action. The fiscal year 2000 request of $35,265,000 will 
allow NRCS to continue to support the 315 RC&D areas currently 
authorized.
                 commodity credit corporation programs
    NRCS also administers, on behalf of the Commodity Credit 
Corporation (CCC), several cost-share programs, including those set 
forth in the 1996 Farm Bill and also provides technical assistance to 
individuals and groups participating in the Conservation Reserve 
Program, which is administered by the Farm Service Agency. The 
conservation programs provided by the 1996 Farm Bill, which NRCS 
administers on behalf of CCC, are the Environmental Quality Incentives 
Program (EQIP), the Farmland Protection Program (FPP), and Conservation 
Farm Option (CFO), and the Wetlands Reserve Program (WRP). In addition, 
NRCS administers the Wildlife Habitat Incentives Program (WHIP), which 
was funded by a transfer from CCC to NRCS. The 1996 Farm Bill also 
amended the Food Security Act of 1985, to the continued implementation 
of which NRCS administers on behalf of CCC.
    The ENVIRONMENTAL QUALITY INCENTIVES PROGRAM (EQIP) provides in a 
single, voluntary program flexible technical, financial, and 
educational assistance to farmers and ranchers who face serious threats 
to soil, water, and related natural resources on agricultural land and 
other land, including grazing lands, wetlands, forest land, and 
wildlife habitat. Assistance is provided in a manner that maximizes 
environmental benefits per dollar expended, while assisting producers 
with issues such as local environmental laws or community identified 
environmental needs.
    Funds of the CCC are used to fund the assistance provided under 
EQIP. For fiscal year 1999, $174 million was available to implement the 
EQIP. The program is primarily available in priority conservation areas 
throughout the Nation. The priority areas consist of watersheds, 
regions, or areas of special environmental sensitivity or having 
significant soil, water, or related natural resource concerns that have 
been recommended through a locally-led conservation process. For fiscal 
year 1998, nearly 75 percent of the EQIP financial assistance funding 
was provided within priority areas. Over 1,300 priority areas were 
approved by the State Conservationists and about 655 of these were 
funded. Funds are made available to the States based upon the quality 
of the priority area proposal, local initiatives, and the environmental 
needs of the affected areas.
    The program has been very successful. We received nearly 55,000 
applications in fiscal year 1998. After NRCS ranked the applications 
based on criteria developed at the local and state level, FSA county 
committees approved over 19,800 long-term contracts with farmers and 
ranchers. The EQIP financial assistance on these contracts will exceed 
$156 million.
    The fiscal year 2000 proposal seeks an increase in EQIP funding to 
$300 million. Based on the fact that requests for assistance far exceed 
available funding, there is a need to continue to prioritize and focus 
our efforts so that we meet our Congressional mandate to maximize 
environmental benefits per dollar expended. We expect that in fiscal 
year 2000, continued interest in animal nutrient management and the 
release of the joint USDA/EPA AFO strategy will spur an increase in 
EQIP participation by owners and operators of animal feeding 
operations. The nutrient management focus of the program will help meet 
national objectives of water quality, while involving farmers and 
ranchers in voluntary and cooperative solutions.
    The WILDLIFE HABITAT INCENTIVES PROGRAM (WHIP) provides for 
implementing wildlife habitat practices to develop upland wildlife 
habitat, wetland wildlife habitat, threatened and endangered species 
habitat and aquatic habitat. WHIP provides a significant opportunity to 
restore native habitat, help landowners understand how to best meet 
their own needs while supporting wildlife habitat development, and to 
develop new partnerships with State wildlife agencies, nongovernmental 
agencies and others.
    WHIP is a solely voluntary program, whose projects encompass a wide 
array of wildlife practices. Projects performed under the program 
include advancing the following measures: upland wildlife habitat, 
wetland wildlife habitat, threatened and endangered species habitat, 
fishery habitat and other approved activities.
    State NRCS offices have made an enormous effort to develop 
partnerships and outreach methods with government and private 
organizations to develop a program that targets specific state 
concerns. We estimate that approximately 1 million acres will be 
enrolled in the program in 1999, at a cost of $20 million. In order for 
WHIP to continue to be a successful national program, it needs to 
remain available for all those interested in incorporating wildlife 
into the overall management of their farm or ranch operations. The 
fiscal year 2000 budget request includes legislation to authorize 
continued funding of WHIP at $10 million. $8.1 million would be for the 
implementation WHIP practices and $1.9 million for technical 
assistance, certification, and status reviews on enrolled acres. Funds 
for technical assistance are critical for the continued implementation 
of program activities.
    The FARMLAND PROTECTION PROGRAM (FPP) protects prime or unique 
farmland, lands of State or local importance, and other productive 
soils from conversion to nonagricultural uses. It provides matching 
funds to leverage funds from States, Tribes, or local government 
entities that have farmland protection programs. The FPP establishes 
partnerships with State, Tribes, and local government entities to 
acquire conservation easements or other interests in land. It protects 
strategic farmland from urbanization. It ensures that the valuable 
farmlands are preserved for future generations and also helps maintain 
a healthy environment and sustainable rural economy. The program was 
originally funded in the 1996 Farm Bill at a level of $35 million. To 
date, those funds have been exhausted, and local interest in the 
program has been overwhelming. In the State of Union Address, the 
President referenced the issue of urban sprawl and the troubling trend 
of conversion of agricultural lands for development. The fiscal year 
2000 budget proposes a total of $77.5 million for the Farmland 
Protection Program in two components: $50 million in new discretionary 
funding from the land and Water Conservation Fund to support the 
President's Lands Legacy Initiative and $27.5 million in CCC funding 
under proposed legislation.
    WETLANDS RESERVE PROGRAM (WRP) is a voluntary incentive program to 
assist owners of eligible lands to restore and protect wetlands and 
necessary adjacent upland areas. WRP preserves, protects, and restores 
valuable wetlands mainly on marginal agricultural lands where historic 
wetlands functions and values have been either totally depleted or 
substantially diminished. Wetland restoration of such marginal lands 
provides landowners with a financial alternative to continued attempts 
to produce agricultural products on such high risk lands. Program 
delivery is designated to maximize wetland wildlife benefits, to 
provide for water quality and flood storage benefits, and to provide 
for general aesthetic and open space needs. Approximately 70 percent 
the WRP project sites are within areas that are frequently subjected to 
flooding and the flood storage being provided will lessen the severity 
of future flood events. The WRP is making a substantial contribution to 
the restoration of the nation's migratory bird habitats, especially for 
waterfowl.
    Cumulative acreage enrollment through fiscal year 1999 is expected 
to reach 775,000 acres. For fiscal year 2000 we propose to enroll 
almost 200,000 acres and essentially reach the 975,000 acre legislated 
cap for the program. Technical assistance funding needed for the larger 
enrollment effort in fiscal year 2000 will be $18,300,000.
    From inception of the program in 1992 through 1998, interest in WRP 
has been exceptional, providing approximately 665,447 acres enrolled in 
the program through the end of fiscal year 1998, and enabling the 
achievement of the long-standing goal to reach the presently authorized 
acreage cap of 975,000 acres by the end of fiscal year 2000. 
Historically, there have been more than five fold as many acres offered 
than the program could enroll. Beginning with the fiscal year 1998 
sign-up, landowners are provided with the continuous opportunity to 
seek enrollment in the program. States periodically rank all unfunded 
offers and seek allocation of funding for the highest ranked offers. By 
following this process, the maximum opportunity for landowner 
participation is provided and the WRP is assured of having the best 
possible list of ranked offers available for funding during the year.
    In response to the 1996 Farm Bill, the enrollment is separated into 
three components (i.e., permanent easements, 30-year easements, and 
cost-share agreements). Pursuant to the 1999 Appropriations Act, 
enrollment is now being balanced to respond to the level of landowner 
interest in each of these three components. The authorized level of 
enrollment for 1999 is 120,000 acres. Thus far approximately 22,000 
acres have been enrolled. The level of landowner interest in the three 
components is presently 77 percent permanent easement, 18 percent 30-
year easement, and 5 percent cost-share agreement. While we project 
that the backlog of unfunded acreage being offered in fiscal year 1999 
will be 7 times greater than the actual acres enrolled in 1999.
    Under the continuous sign-up process the backlog list for each of 
the program components will continue to be updated. Once the fiscal 
year 1999 enrollment process is completed, these lists will be 
available for immediate use in selection of the 2000 enrollment.
                               conclusion
    NRCS offers landowners a great deal of options and can provide 
programs and resources that are tailored to an individual customers 
needs. And the assistance is interactive. We expect to gain a full 
understanding of the needs and goals of our customers and provide 
planning and programs that a farmer and rancher can realistically 
implement. This is what has made NRCS an attractive vehicle for 
offering so many different kinds of assistance. It is also why when we 
look toward emerging issues such as nutrient management and greenhouse 
gasses, that NRCS is an obvious choice to lead the way. However, these 
policy and financial commitments become moot unless the Department of 
Agriculture and NRCS, its lead conservation agency, have sufficient 
resources to deliver the technical assistance that farmers and ranchers 
time and again say they need to take advantage of the conservation 
opportunities now confronting them. Our partners in State and local 
governments and the private sector, responding to widespread public 
support for environmental protection efforts, have increased their 
financial commitments to conservation on private land in recent years. 
At the same time, they look to the Federal government for a continuing 
commitment to technical assistance for private land and private 
landowners, not the diminishing commitment in real dollars that has 
been the trend over the past two decades. It is this technical 
assistance that, when coupled with the contributions of our many public 
and private-sector partners, will allow us to realize the full promise 
of the 1996 farm bill and to look beyond. Given the needed resources in 
this appropriation request, we can support the field conservationists 
of NRCS to make it happen.
    That concludes my statement. I am looking forward to working with 
you in the months ahead to review the proposal and work together to 
maximize service to our customers and help them be good stewards of the 
land. I will take any questions that members of the committee might 
have.

                      TIMING OF DISASTER PAYMENTS

    Senator Cochran. Thank you very much, Mr. Schumacher.
    One concern that we have is that it has taken so long to 
get these payments that have been authorized and funded in this 
disaster assistance package to the farmers. We were hopeful 
that this could be handled with a little more dispatch than it 
has been.
    You mentioned in your statement postponing the signup date 
until some time in April. It seems that, when we passed that 
emergency assistance, we were promising funds would be 
available, and you did, as you said, send out some of the 
money. Where people were already on the rolls and already on 
the list in the computers, those checks got sent out quickly. 
We appreciate that and commend you for that.
    But the other part of the program has not really produced 
any money for farmers or any disaster assistance. It was called 
an emergency program and we are getting asked: where is the 
money and where is the assistance?
    I know you had to design new software and you had other 
problems. And these offices have worked very hard. I agree with 
you here. The people out in the field are doing all that they 
can. But it seems that there is not enough emphasis on this 
program from the Washington level.
    What can we expect in terms of getting the funds under this 
program into the hands of farmers in view of the very serious 
economic situation in which they find themselves this year?
    Mr. Schumacher. Thank you, again, for your comment.
    If I may just take a minute or two on this, this is very, 
very important. A lot of farmers are interested in when they 
are going to get their checks, and what else they have to do to 
qualify for the different categories of disaster assistance. If 
you would bear with me for a minute or two, I would like to 
walk through it a bit.
    When the bill was signed in November, as you said, the 
computers worked very well, and we were able to issue the first 
round of payments very quickly. There were no glitches, checks 
went out, and people were actually commenting and asking how we 
got those out so fast. It was terrific.
    However, when we started the second phase of assistance, 
complications began to set in. First, we had a number of, shall 
we say, inquiries from both Senate and House members, asking 
for some changes. There was an interesting dialogue for a few 
weeks with members of Congress.
    We did make a few adjustments. Some of them we could not 
make, but some we did make, and that delayed it for a few 
weeks.
    Then we hit the California freeze. That hit us hard, and we 
looked at making some further program adjustments because of 
that. We have to work very hard on that.
    So if we look at what is going well, we have $400 million 
insurance, buy-up for the buy-down, clear and that is moving 
reasonably well.
    I think the dairy assistance program will work well. We 
have that moving quite quickly. We are helping dairy farmers 
and I think that will go fairly well.
    I think the multi-year crop loss disaster assistance 
program is going reasonably well. We need to sort out a key 
issue of entities, and if you have further questions, I can ask 
Ken Ackerman to address that. But that, by and large, is going 
fairly smoothly once we have the entity issue sorted out. It 
was certainly raised by other Members of the Senate.
    The Livestock Assistance Program has sort of overwhelmed us 
with the number of applications. We only have $200 million, 
which we will have to prorate. We extended the signup to March 
25. Payment will go forward, as I said, in April.
    The biggest challenge right now is the single-year crop 
loss disaster assistance program, Mr. Chairman. We had some 
computer compatibility problems, which should be resolved this 
week. The program has been extended to April 9. Once we have 
the computers fixed, we will get that done.
    I think it is very important that we get our software in 
order because this will help farmers when we actually get down 
to the final paperwork. This is because if we get the computers 
set up right, which we think we can get done fairly quickly, 
producers will not have to reconstruct their 1998 records. This 
is very important. And they will not have to come into the 
offices with a reconstruction of their prior year records 
either. If we can take the time now to get it right, then we 
will get those payments out in late spring.
    We have done a lot of work. We have more work to do, and we 
promise we will be getting that assistance out.
    We have taken one additional measure. I am very pleased 
that Carolyn Cooksie is here; she is our Deputy Administrator 
for Farm Loan Programs, under Keith Kelly. With the 
supplemental coming down there is tremendous workload on farm 
credit by her group. What we are going to do is let farmers do 
some income assignments, using an estimate of what the farmers 
are likely to get in crop loss and livestock feed assistance 
payments. I think it will be helpful for farmers to have those 
amounts reflected in their cash flow when they come in to see 
loan officers at the local level.
    So we are trying to be flexible and timely. It is 
complicated. But I think, by and large, we are working it 
through and we will get those payments out fairly soon.

                      LIVESTOCK ASSISTANCE PROGRAM

    Senator Cochran. With respect to the Livestock Assistance 
Program, is there any date that you can give us that we can 
pass on to our farmers and let them know when they may expect 
to actually receive payments?
    Mr. Schumacher. Parks, do you want to comment on that?
    Mr. Shackelford. Early April.
    Mr. Schumacher. In early April.
    Senator Cochran. We know that you cannot make a final 
decision on how much money an individual farmer gets until the 
signup has been complete. Isn't that correct?
    Mr. Schumacher. Yes, we have to factor that.
    Senator Cochran. Because it is all prorated.
    Mr. Schumacher. Right.
    Senator Cochran. So can you estimate at this point, based 
on the applications you have received, how much money this is 
going to mean to individual farmers? Can you give us an 
estimate of that?
    Mr. Schumacher. Keith mentioned that it is 25 percent to 30 
percent on the Livestock Assistance Program.
    Senator Cochran. For the Livestock Assistance Program, yes?
    Mr. Schumacher. Yes. It's 25 percent to 30 percent. The 
factor will take it down because the demand has been so high.
    Senator Cochran. Considering the demand and how high it has 
been, is the Department considering asking for any additional 
funds for this program?
    Mr. Schumacher. Our supplemental that we sent up does not 
include this. We want to get the available funds out as quickly 
as possible, and we have not formally considered an additional 
request for this within the Administration.

                             COTTON PROGRAM

    Senator Cochran. Mr. Collins, you mentioned the export 
situation and a lot of the prices that are affected by that, 
the breakdown in some of these markets. In the cotton program, 
you talked about the Step 2 program and that you were out of 
money.
    Is it not a fact that the Administration requested a cut in 
funding for this program last year and that you have requested 
no money for the program this year?
    Mr. Collins. That is a fact, Mr. Chairman.
    Senator Cochran. Why haven't you?
    Mr. Collins. I think it was simply a question of budget 
priorities. It was a question of looking at the various needs 
that we had within our mandatory spending. We simply decided 
that the cotton Step 2 program was not among the top priority 
items.
    That does not acknowledge that there is not an effect by 
not having a Step 2 program. I think we have seen one this 
year.

                   USE OF EXPORT PROGRAM AUTHORITIES

    Senator Cochran. We hope that the Administration will be 
more aggressive also in these export enhancement programs. We 
noticed that the EEP Program and the Dairy Export Enhancement 
Program, and other programs may not be as aggressively utilized 
by the Department given the downturn in our sales in overseas 
markets as they should have been.
    Tell us how the Department has utilized these existing 
authorities. Some of this does not depend upon funding that 
this Committee provides. You have CCC authority that you can 
use. But there does not seem to be any aggressive work going on 
in this area.
    Am I wrong? If I am, tell me how I am wrong about that.
    Mr. Schumacher. You know, the Australian Prime Minister 
called me an ``avaricious looter'' for some of our aggressive 
use of our GSM. I was quite surprised at that, Mr. Chairman. I 
don't normally get those kinds of comments. Particularly, I 
think we have been very, very aggressive in terms of the 
utilization of our CCC authorities on food aid to Russia and to 
other countries associated with the President's food aid 
initiative announced last July.
    On the Dairy Export Incentive Program, I think we are at 
the right level, and we have rolled up some unused balances 
from prior years to even more aggressively use the program. We 
have certainly heard from some of our competitors as they felt 
we went beyond our authorities. But we felt that that was the 
right thing to do and think that it has been very effective and 
the program has been fully utilized.
    On the Export Enhancement Program itself, as you recall, 
when the EU tried to subsidize barley into this country, we 
took very, very aggressive steps and used our EEP authorities. 
But, overall on EEP, we have not used it in the last couple of 
years because we felt that the utilization of the other 
authorities of the CCC would give us a more targeted response, 
especially on wheat.
    Senator Cochran. Senator Kohl.

                        DAIRY ASSISTANCE PROGRAM

    Senator Kohl. Thank you, Senator Cochran.
    With respect to the $200 million in assistance to dairy 
producers, do you have a target date for the distribution of 
that money?
    Mr. Schumacher. Yes. We would like to get that out in early 
April, if we can. It's sometime in April.
    Senator Kohl. The money is to be distributed in early 
April?
    Mr. Schumacher. If we can make that target.
    We have pretty well completed all of our analysis and a 
number of proposals have been made. We are examining that 
program at the highest levels in the USDA at the moment, and we 
hope to have an announcement fairly shortly, Senator.
    We are going to keep the program as simple as possible. So 
dairy farmers will get their payments in the spring flush.
    Senator Kohl. Can you give us some indication with respect 
to the general principles that you will use in your decisions 
as to how to distribute that money? I am talking about will it 
be on the basis of trying to help small family farmers? Or will 
it be on the basis of number of units, like factory farms, 
things of that sort? Give us some indication of where you are.
    Mr. Schumacher. Well, the proposals we are putting forward 
are not quite formally at the Secretary's level at the moment, 
but they are very, very near to getting there. But, certainly, 
we would be tilting toward helping family operators.
    Senator Kohl. OK.
    I would like to ask you with respect to the ongoing efforts 
at USDA to reform U.S. dairy policy, to what extent does 
current dairy policy still serve to avoid disruptions of 
supplies of fluid milk to consumers? And, have not changes in 
technology and transportation vastly reduced or even eliminated 
those kinds of problems?
    Mr. Schumacher. Keith or Mike Dunn, would you respond?

                              DAIRY POLICY

    Mr. Collins. I will respond.
    I think that certainly the current dairy policy--and by 
that you are referring to Federal milk marketing orders, I 
believe, which have the purpose of ensuring adequate fluid 
supplies to fluid users. I think the question is are they still 
as relevant today as they were when they were conceived in the 
1930's.
    I think economists have looked at this question in a lot of 
detail and have come to the conclusion that there still is a 
purpose to be served in ensuring a stable, adequate, high 
quality supply of milk to fluid users. I think that is one of 
the reasons why Congress did not eliminate the Federal Milk 
Marketing Order Program in 1996.
    Nevertheless, I think that the 1996 Farm Bill suggested 
that the whole program needed to be looked at. The changes in 
technology and transportation that you are talking about, the 
ability to truck milk 1,000 miles with almost no loss in 
temperature of the milk, and quality of the milk mean that we 
had to go back and take a very hard look at the incentives that 
are in the program to ship milk from one region to another.
    That has been the whole purpose behind the work we have 
done in Federal milk marketing order reform.
    So I think the answer is that there is probably a general 
consensus that many of the provisions of orders still have a 
usefulness, but that the levels at which they are set may not 
be appropriate.
    Senator Kohl. All right. In connection with that, how can 
dairy policy be shaped in order to eliminate or reduce undue 
harm to any one region of the country? What is USDA doing to 
help establish a policy that can benefit all dairy producers?
    Mr. Collins. This is the essence of Federal marketing order 
reform.
    We did propose a rule last year. We took 4,000 or so 
comments on that rule. We are in the process of issuing a final 
rule.
    I can only say that I can guarantee you, Senator Kohl, that 
the final rule will be issued within the next 4 to 5 weeks 
because the statutory deadline is April 4.
    So we will have a final rule, and I hope you will see in 
that final rule that we have addressed some of your concerns, 
that we have tried to design a dairy policy that more reflects 
the technology change in the marketplace and that does impart a 
sense of equity across the Nation. But it will be up to you to 
make that judgment when you see it.

               IMPACT OF TRADE AGREEMENTS ON DAIRY PRICES

    Senator Kohl. Thank you.
    Secretary Schumacher, you mentioned in your statement the 
efforts you are making to promote dairy exports through the 
Dairy Export Incentive Program. In terms of trade, we need also 
to consider the effect of imports on dairy producers.
    What effect are dairy imports having on domestic prices? 
And, in particular, what has been the impact of NAFTA, GATT, 
and the WTO on domestic prices?
    Mr. Schumacher. The dairy imports are under tight quotas. 
We have not seen much impact on dairy imports--some on the high 
value cheeses. But I notice that we are getting much more 
competitive on some of the specialty cheeses and high value 
cheeses in different parts of the country.
    With respect to NAFTA, we have done very well in Canada and 
Mexico. Exports continue to rise, nearly $13 billion between 
our two NAFTA partners. It has been a real success. But on 
dairy and poultry in Canada, we have not done well under the 
existing NAFTA and Canadian Free Trade Authorities.
    We lost the dairy case with Canada. Certainly in the next 
round we are going to take that up again because there is a 
wonderful market in Canada with their supply management system. 
Canada theoretically is supposed to be free trading under 
NAFTA. But on dairy and poultry, we do not really have as much 
access as we really need to have to that market.
    We will be taking that up aggressively--and they are well 
aware of that--in the next round of the WTO starting in Seattle 
in November.

              OPPORTUNITIES AND OBSTACLES TO DAIRY EXPORTS

    Senator Kohl. In addition to the Dairy Export Incentive 
Program, what opportunities do we have to support dairy exports 
and what specific obstacles do you see?
    Mr. Schumacher. Chris, would you join us on that?
    Chris is running the Dairy Export Incentive Program.
    I think we have had some success, especially, for example, 
on some of the powders in Mexico where there is a strong 
demand. They are privatizing further down there. We have had a 
number of inquiries even yesterday for additional powder. So I 
think there is pretty good demand for that.
    Our biggest problem, Senator, to be quite frank, is the 
European Union. Their inability to eliminate export subsidies 
on dairy is really hurting us very badly. That, again, is 
something we are going to be very aggressive on in the next 
round. We need a level playing field with those tremendous 
subsidies they have on the export side. It is killing us in the 
long term. There is no question about that.
    Chris, did you want to amplify on that?
    Mr. Goldthwait. I would make two points.
    Senator Cochran. Would you identify yourself for the 
record, please?
    Mr. Goldthwait. I'm Chris Goldthwait, the General Sales 
Manager at the Department.
    I would add two points to what the Under Secretary has 
said. First of all, we are already competitive in world markets 
with respect to some specialty dairy products--for example, 
whey powder and ice cream.
    I think the second important thing is that, as the Under 
Secretary said, our dairy industry is beginning to look forward 
to the aftermath of the next trade round, at which point we 
hope we will have eliminated the European export subsidies.
    We foresee that we are going to be competitive in a much 
broader range of dairy products in the absence of the 
distortions caused by the EU export subsidies. And we are 
already positioning ourselves through the use of the DEIP 
Program for that situation where, for example, just in the past 
few months we have introduced a special use of the program for 
specialty cheeses where we think, once the cheeses are 
introduced to foreign buyers, they will demand a premium over 
the generic market cheeses.
    Mr. Schumacher. If I may, Senator, I just want to clarify 
one important issue.
    In the original poultry and dairy situation we did not do 
well. But we did recently win a WTO case in Canada, and I am 
very pleased about that. I mean how can we export when they 
have a 300 percent tariff against us?
    We did win that one.
    Senator Kohl. Okay.
    There are many small farm operations, as you know, that are 
finding it increasingly difficult to compete in an environment 
of large corporate interests. For a number of reasons, the 
small operator is finding it more and more difficult to balance 
rising production costs with shrinking leverage in the 
marketplace.
    To what extent is the current downturn in prices especially 
harmful to small operators?
    Mr. Schumacher. I think this is one of the most difficult 
issues we are facing. The operators, for example, in Minnesota 
and Wisconsin--Mike, you may want to join us on this one--for 
them I think the average is going to be very difficult. It is 
buffeted, to some extent, by low feed prices and a drop in 
interest rates.
    But certainly, as the dairy prices go down, it will 
probably be unduly hurtful to family operators with 50, 70, 80 
cows.
    Senator Kohl. Is this a cyclical thing or is there 
something more deep operating in the marketplace that makes 
these small operators more and more likely to go out of 
business permanently?
    Mr. Schumacher. I have been for many years working with 
small dairy farmers in different parts of the country. As we 
see some of the big dairy feedlot operations expanding in the 
Southwest and in the West, and in some cases in the Rocky 
Mountain Foothills, they have certain advantages of water, 
three times a day milking, and lower costs in the Southwest 
because of the better climate. It has made them a little bit 
more competitive on these large operations. There are also 
cheaper labor costs.
    So it is going to be a difficult time, I think, with lower 
dairy prices in the next couple of years for smaller operators 
in the North-Central and the Northeastern part of the United 
States.
    We are even hearing from the Southeast extensively. A 
number of commissioners are constantly calling me to assist on 
dairy as well.
    Mike, do you want to add to this?
    Mike has been our lead on dairy. Maybe he could make a 
comment. This is Michael Dunn.
    Senator Cochran. Mr. Dunn, would you state for the record 
your title.
    Mr. Dunn. I am Michael Dunn, Under Secretary for Marketing 
and Regulatory Programs.
    Certainly, we are concerned about all small farmers. 
Senator Kohl, if you are addressing specifically dairy 
producers, last year the basic formula price averaged a little 
over $14. That was an outstanding year. In March, when the BFP 
did drop down to $10.88, we had some hearings on whether or not 
we should establish a base price, a floor price. Most folks 
indicated that that should be about $13.50.
    So at $14 BFP last year, we had a very, very good year.
    As Mr. Collins has indicated, unfortunately, we may not see 
that this coming year. So that will, I believe, force us to do 
a lot more innovative things than we have in the past.
    Senator Kohl. What do you expect will be the price of feed 
this year on average?
    Mr. Collins. As I indicated in my opening statement, I 
thought it might be very close to the 1997 level, which was a 
little over $12 per cwt. It was $12.05 in 1997, which was a 
year of great financial stress for dairy producers.
    This past year, as Mr. Dunn said, it was $14.20.
    All along over the last few months, I have been thinking it 
might be about midway between the two years. But if you have 
seen what has happened in milk markets over the last couple of 
weeks, notably a 1-day drop in the BFP futures of over 60 cents 
this week, I am now thinking it is probably going to be much 
closer to the $12.05 than to the $14.20--maybe between $12.00 
and $12.50, probably.
    Senator Kohl. Thank you.
    Thank you, Mr. Chairman.
    Senator Cochran. Senator Durbin.

                           AGRICULTURAL TRADE

    Senator Durbin. Thank you very much, Mr. Chairman.
    I thank the witnesses for joining us today.
    Could I ask some general questions on trade, Mr. Collins? 
Perhaps others could help?
    We have been told that our trade deficit continues to rise 
in this country at alarming rates. Usually, we have had a 
positive trade surplus in the agricultural accounts. Is that 
still a fact?
    Mr. Collins. It is still a fact, although this year will be 
the lowest in over 10 years.
    Senator Durbin. On the agriculture account?
    Mr. Collins. On the agriculture account. It will be about 
an $11 billion surplus. A couple of years ago, it was as much 
as $27 billion or $28 billion.
    Senator Durbin. So are we continuing to import more food or 
are exports going down? Or both?
    Mr. Collins. Both.
    Senator Durbin. Both at the time?
    Mr. Schumacher. I think exports, Senator, have gone down 
like $10 billion. Imports just chug along at about $1 billion 
extra. So it is a gradual rise in our imports and a sharp, 
relatively sharp, drop in our exports, although I think we are 
still well ahead of where we were on exports in the first 3 
years of this decade.

                             EXPORT TACTICS

    Senator Durbin. Secretary Schumacher, you also mentioned 
that we have come into some controversy about tactics in terms 
of encouraging export products. Could you be more specific?
    Mr. Schumacher. Yes.
    Tim Galvin, Chris Goldthwait, and the fine folks we have in 
the Foreign Agricultural Service have done an absolutely 
spectacular job in the overseas area.
    For one, we have doubled the GSM program credits, as I 
mentioned in my testimony earlier, especially in Asia.
    We have also had major increases in our food aid donations 
in terms not only of existing programs, but we have put 8 
million tons additional into the pipeline. That is now moving 
forward. Most of that will be shipped this year.
    In terms of meat volume--if we look back 10 or 12 years--
the really major change that has occurred is the extraordinary 
performance of our poultry exports until the Russian problem 
hit. We now have a net value surplus on beef. And our pork 
continues to do very, very well on a volume basis.
    So on volume, we are doing quite well on the red meats and 
certainly were doing superbly on the poultry until the Russian 
thing hit. But when it did hit, we then put 50,000 tons of 
poultry on donation, and then 200,000 tons or so on P.L. 480, 
Title I. We heard some criticism from some of our trading 
partners.
    But I think it is legal. We are well within our WTO 
obligations, unlike the Europeans, who are bumping up against 
them.
    So we continue to be very aggressive in the use of those 
programs and will be very active in the WTO, whether it is on 
cherries, or apples from the West, or other issues that we are 
dealing with--for example, the long-standing problem we have 
had on beef hormones. That is coming to a head on May 13 and we 
are working hard on that as well.
    So we have been very aggressive and we certainly have been 
criticized by some of our trading partners for that. But so be 
it.

                         NAFTA TRADE INCREASES

    Senator Durbin. I note from testimony here that it appears 
that the bottom has dropped out of the Pacific Basin demand for 
U.S. exports. I think there is some indication that the NAFTA 
trade, though, has increased. Is that what your testimony has 
indicated?
    Mr. Schumacher. That is correct, Senator. We are doing 
actually quite well with our Mexican partners and are holding 
our own in Canada. But what is interesting is Japan. They 
continue to be our single largest trading partner but trade has 
dropped off $3 billion or $4 billion, mostly in value, because 
of their recession. That has certainly had an impact since they 
are unwilling to open up some of their markets not only to 
ourselves but to their neighbors. That has exacerbated the 
recession in Malaysia, Thailand, and other big markets where 
trade has fallen off as well.
    So the bulk of that drop has been in Asia. We are holding 
steady in South America. The whole Western Hemisphere is $18 
billion and is holding pretty steady. We continue to do 
reasonably well in Europe with a two-way trade of about $18 
billion.
    In Russia, we were not selling a great deal, except for 
poultry. I think that is why the work of Tim and Chris on 
poultry will be helpful.

                             CROP INSURANCE

    Senator Durbin. If I could switch to another topic, I have 
to leave very briefly. I wanted to talk about the risk 
management aspect of this.
    I have supported disaster assistance. There have been times 
when I have needed it in my home State and other States have 
needed it. I have tried to be sensitive to their needs.
    We have said for a long time, though, that we are going to 
try to encourage producers to buy crop insurance, to provide 
for themselves, and that there would be some penalty attached 
to it if they did not. We have had a variety of different 
approaches in this area in the past, suggesting that if you did 
not buy the crop insurance, you would not be eligible for 
disaster assistance.
    I listened to your testimony and it suggested that we are 
still having a very difficult time convincing producers to buy 
crop insurance. I don't know if that is a fair characterization 
of what you said.
    Mr. Schumacher. I think what we have tried to do is this. 
The Congress delinked the program payments from crop insurance 
so that it was not mandatory so there was some drop-off. But I 
think what we try to do now with this disaster is to roll 
forward the $400 million so that we make crop insurance more 
affordable this coming year, as I indicated, to buy down the 
buy-up coverage. I think that has been popular.
    We are also widening very much the crop insurance, for 
example, our whole farm adjusted gross revenue in pilot 
programs. And, as indicated, we have 4, 5, or 6 major 
initiatives in our white paper, and we will be expanding on 
those in hearings coming up in the next 10 days.
    Senator Durbin. I want to take a closer look at that. A few 
years ago we got into it and discussed the fact that we were 
selling crop insurance in areas where God had instructed us not 
to.
    We had had crop failures 70 percent of the time, but we 
still sold the insurance policy as if maybe next year it will 
come around. I would like to get an update on that, perhaps, 
and see how we are doing in that regard.
    Thank you very much for your testimony.
    Senator Cochran. Next is the distinguished Senator from 
North Dakota.

                              FARM SUPPORT

    Senator Dorgan. Mr. Chairman, thank you very much.
    Let me thank the representatives of the Department of 
Agriculture. We have put you through some difficult times with 
the disaster program that we developed last fall. We also thank 
the Chairman of the Subcommittee who was instrumental in the 
Senate in helping move that, and the Ranking Member as well.
    What we have provided for you is a very substantial task. 
Your agency does a lot of good work under difficult 
circumstances, and I appreciate that.
    Having said that, let me just tell you that, as I look 
through the budget here, I am reminded that the Department of 
Agriculture was initiated under President Abraham Lincoln with 
12 employees. We have come a long way since Abe Lincoln created 
the Department of Agriculture. But, as I read your statement, 
Mr. Collins--and you are an economist, right?
    Mr. Collins. Yes, sir.
    Senator Dorgan. I taught economics for a couple of years. I 
always say that I was able to overcome that. But it is an 
interesting field. [Laughter.]
     Your testimony was really very interesting to me. But my 
central thesis is I don't really think we need a Department of 
Agriculture at all--we can move all of the other functions 
elsewhere in government--unless the central goal is to maintain 
a network of family producers, and family farmers in our 
country.
    If that is not the goal, in my judgment we should just 
abolish USDA and move some of these other things around to 
another agency.
    But if our central goal is to maintain a network of family 
farm producers in our country, then the question, as I look 
through your statement and others, is how are we going to do 
that? The price of wheat in North Dakota this week is about 
$2.60 or $2.70 a bushel.
    Price adjusted, those are Depression Era prices. That goes 
back to the Great Depression.
    Your statement, Mr. Collins, indicates that that probably 
will not improve in the coming year. And if that is the case, I 
want to ask a series of questions.
    Congress has said under the current farm program that we 
want farmers to operate in the free market and we are going to 
create a decreasing level of support in our farm program. So we 
are now in a sliding scale of downward support prices at a time 
when we have wheat prices equivalent, in price adjusted terms, 
to those of the Great Depression.
    Last fall we did something to try to help people get into 
this spring. But the fact is it does not make anybody whole.
    If we do nothing, are we not going to lose a massive 
quantity of family farmers? I mean, you did not have a lot of 
discussion in your presentation about family farming. Your 
discussion was about aggregate numbers with respect to income 
and so on.

                           NUMBER OF FARMERS

    Are we not, under the current scheme of the farm program of 
declining price supports, at a time when we have seen a 
collapse of commodity prices and no expectations from you that 
they are going to improve? Are we not going to see a wholesale 
reduction in the number of farmers out in this country?
    Mr. Collins. I think we will certainly see a decrease. 
Surprisingly, if you look at farm numbers, they have been quite 
stable over the last 5 years, at around 2.2 million farms. That 
is our revised estimate based on the census of agriculture. The 
census of agriculture has 1.9 million farms, but the annual 
survey that we do shows 2.2 million.
    Within that category, though, there have been some 
substantial changes, particularly, as you characterize it, the 
small family farm in the middle, the one who says they are 
principally engaged in agriculture, the one who is trying to 
get most of their income from agriculture, but whose annual 
sales might be $50,000 to $200,000. Those are the ones who have 
been under tremendous stress and, in many cases, those are the 
ones who have gone out of business, or they become smaller, or 
they become larger.
    There has been a lot of dynamic change in that area.
    So yes, I would look out over the next couple of years and 
if this situation that we have now persists for any appreciable 
time, I would think we are going to put tremendous pressure on 
those farms.
    Senator Dorgan. I think those numbers are completely at 
odds with what is going on in the country.
    My home county has gone from 5,000 people to 3,000 people 
in a 20-year period, and in recent years it has accelerated. If 
you stand on a section line and look in any direction, you can 
name the farmers that are gone who were there 5 years ago, 3 
years ago, or 10 years ago.
    Mr. Collins. Sure.
    Senator Dorgan. So the aggregate data is at odds with what 
you see out in the country, I think. Most of these farmers are 
leaving and what we have is a skeleton out there. These small 
towns are drying up as a result of it.
    The reason I am asking the question is this. It seems to me 
that the real pile driver here on the budget question is what 
must Congress do to respond to a circumstance of Depression-
level prices? Is the Freedom to Farm bill with decreasing price 
supports--at a pretty pathetic level at this point--going to do 
anything? Or is it just sort of waiting while we see a 
wholesale collapse of the family farm structure?
    And if that is the situation, then do we not have a 
requirement, both from the Department of Agriculture to 
recommend, and the President to recommend, and the Congress to 
respond, for some new, significant initiative that says this 
country wants to have a network of family farmers in its 
future?

                          FARM POLICY CHOICES

    Mr. Collins. Maybe I could start that and Mr. Schumacher 
could chime in since you are fundamentally asking a policy 
question as well.
    The answer to the first part of your question about how the 
Farm Bill will perform is this. Clearly, in 1996, we took away 
some of the counter-cyclical effects of the Farm Bill. There 
still is a very modest counter-cyclical cushion in there. That 
is the loan deficiency payment, which is kicking in. But, 
admittedly, it is a level that is at a fairly low rate relative 
to production expenses for many farmers.
    Senator Dorgan. A couple of dollars a bushel below 
production levels.
    Mr. Collins. For many farmers. I agree with that.
    There is also the AMTA payment on top of that, which has 
been running at $5.5 billion, but, as you say, it will decline 
to $4 billion by the end of the period.
    So there is some support being provided by government. I 
mean, we will spend in fiscal year 1999 $18 billion on farm 
price and income support programs. The last time we did that 
was in the 1980's.
    So I would not characterize the current farm program as 
simply walking away.
    On the other hand, farmers have seen their costs rise over 
time. The fact that there are not the counter-cyclical benefits 
of the earlier Farm Bill, combined with the world economic 
problems and the shrinking demand, there is no question that 
this Farm Bill is not going to offset that kind of income loss.
    Then that becomes a policy question, how you want to deal 
with that.
    In 1996, the policy choice was to move away from affecting 
market prices, to, in a sense, decouple the program to the 
extent that it could be decoupled.
    If you are going to go that route, then the only choice for 
enhancing farm income is through larger direct payments to 
farmers.
    If you are not going to go that route, then you have to 
make the choice: do you want somehow to have government affect 
supply and more directly intervene in market prices? Those have 
been the choices on the table for a long time.
    Senator Dorgan. Mr. Chairman, I recognize that I asked a 
policy question, but the implication of a change of policy that 
I think is necessary has huge budget ramifications. That is the 
reason I did.
    I look at the numbers bureau by bureau, and so on. All of 
that is just moving nickles and dimes around. If we are not in 
a circumstance where we have family farmers given the 
opportunity to survive during these tough times, then all of 
this, in my judgment, is basically for naught. I would just as 
soon consult Abe Lincoln and maybe get rid of USDA--that is not 
my choice, of course--and move the other things around.
    I essentially want the central feature here to be a feature 
that says we want to maintain a network of family farmers, and 
the budget implications of doing that, from a policy 
standpoint, is what we ought to be discussing.
    Senator Cochran. Thank you, Senator.
    Senator Burns.
    Senator Burns. Thank you.
    Senator Dorgan, we can do only one thing to eliminate the 
attrition of small farmers: pass a law that you cannot build a 
tractor any more than 65 horsepower on the drawboard. That will 
do it--pure and simple.
    I thank you for coming today and appreciate it very much.

                         PRODUCTION AGRICULTURE

    Senator Burns. I do want to say that, as for the root of 
our problem, we are probably working on the wrong end of it 
when we start talking about the economic climate of American 
agriculture at the production level.
    I think our good friend at Auburn University made a good 
point. Since 1984, we have only seen food prices go up about 3 
percent, but we have seen increased profitability both in the 
banking, meat processing, grain companies, and transportation. 
The good times have rolled on. Also there has been increased 
profitability in our grocery stores. But we have seen farm 
income drop almost over 30 percent.
    We can make it through any kind of economic decline in any 
of the commodities if those prices on the decline are reflected 
in the end product, because we consume everything we produce--
but at a price. We have not seen that happen at this time, 
however, and no commodity is making any money at the production 
level.
    Oil is $7 a barrel. As for mining, the environmentalists 
are trying to run that out of Montana. There is also timber, 
and certainly no product from the farm.
    What I am saying is at the production level nobody is 
making any money.
    However, on the other end of it, on the front end of the 
grocery store and where the consumers pay, they are doing 
fabulously well, as Wall Street would indicate.
    So I think we are working on the wrong end of this thing.
    Exports in pork, as you brought up, Mr. Schumacher, have a 
$15 live weight on hogs. We ought to be covering the world in 
hogs. There is nobody, not even the Taiwanese, who could 
produce hogs at that level.
    I am just at odds as to where the answer lies.
    I think this bodes hard times for the rest of the economy, 
but it has not come yet and I thought it would be here by now. 
So I was wrong about that. Of course, I have not been right on 
much, anyway.
    But I am right on one thing, though. Everybody got worried 
about Y2K and I went up to the Montana Department of Livestock 
and filed for that brand, Y2K. [Laughter.]
    That cost $50. The other day a guy called up and said he 
would like to have something to commemorate the turning of the 
century, but you own that brand. Would you take $500 for it.
    Now I'll have to look at that. That might be a good trade. 
I don't know. [Laughter.]
    I just want to say that my message here is that we are 
working on the wrong end of this thing. We are not getting any 
support from our processors, purveyors, and retailers--none.
    I think that is our big problem. We are just not getting 
our share of that consumer dollar. I did not see pork chops go 
down in price at the grocery store. Did anybody go to Giant 
Food recently? Your pork chops cost the same, don't they? They 
cost the same.
    Mr. Collins. No. The Consumer Price Index for pork chops 
for January was about 10 percent lower than for January 1998. 
So they are going down somewhere in this country.
    Senator Burns. But, I'll tell you, it's just like moving 
the Rock of Gibraltar.
    Mr. Collins. It is hard, I admit.
    Senator Burns. Yes, it is hard to do.
    But I think that is where the problem lies, and I don't 
think anybody has come up with any answers. I sure have not 
come up with any. But that is where we have to work on it. That 
is what the USDA has to do, start going to our companies and 
saying listen, folks, we have to get some dollars back to the 
farm, and that is where you come in.
    You could become an advocate for production agriculture 
because you have the power to do it. You have the power to call 
up any CEO in this country and they will return your call. But 
we are not doing that. We are not doing that.
    Those are the areas where we have to work.
    I was in Minneapolis yesterday and talked to some pretty 
large sized, important folks there. I am going to continue to 
work with those folks and try to get ourselves out of this 
situation. I don't think the Government could do it.
    I don't think this Federal Government can deal with the 
problem that we have with our friends to the North. I don't 
think the Government can do it.
    I think producer to producer we can do it. We can do 
something about the rate of exchange, and we can help the 
Canadian farmer if we can raise his income level. This is 
because when the water comes into the bay, all boats go up.
    We have to get them in a position to where they are making 
money, too. We have a great production and we are very 
proficient. We do everything. There is no part of the American 
economy that is more efficient than agriculture at the 
production level. I mean, we are good.
    Senator Cochran. Excuse me. We have a vote on now.
    Senator Burns. Really? Then I will go vote now and will 
just shut up. [Laughter.]
    But I want to make that point. You are sitting in a 
position where you can do something and you have to call those 
folks in. That is where it is at. We could eat our way out of 
anything.
    If you pick up a farm paper in Missouri, it says to come 
and get your hogs: free hog, free Christmas pig. And nobody is 
doing too much about that.
    I say that that is your role.
    It is good to see you are better, Jim Baker. I was worried 
about you a little bit. I thought you were on the casualty list 
there for a little while.
    Let's go vote.
    Senator Cochran. The Committee will stand in temporary 
recess so that we can go to the floor for this vote. We will be 
back very shortly.
    Thank you.
    [A brief recess was taken.]
    Senator Cochran. The Committee will please come to order.

                         CROP INSURANCE PROGRAM

    Earlier this month, the Secretary of Agriculture in a 
speech he made announced some proposals to strengthen the Crop 
Insurance Program. My question is, is there a specific 
legislative vehicle that will be introduced at the 
Administration's request to authorize changes in the program? 
If so, what will the changes be? What are the costs estimated 
to be? Will there be any kind of additional funding request 
made of this Congress this year for crop insurance?
    Mr. Schumacher. Mr. Chairman, with your permission, I would 
like to ask Ken Ackerman, if he could, to join us at the table. 
Ken will be testifying extensively in the next few weeks and he 
could help us address that question. He is the man on the spot.
    Senator Cochran. Thank you.
    Mr. Ackerman, tell us what your official title is these 
days.
    Mr. Ackerman. Thank you, Mr. Chairman.
    My official title these days is Administrator of the Risk 
Management Agency.
    Senator Cochran. Thank you.
    Mr. Ackerman. I guess on your question, as Mr. Schumacher 
mentioned, I will be testifying in more detail on this over the 
next 2 weeks before the authorizing committees--before the 
Senate Agriculture Committee on March 17 and on the House side 
on March 10.
    We will be putting more detailed proposals on the table. 
The Secretary proposed a white paper at the time the budget 
came out on February 1 that outlined our ideas for reforming 
crop insurance.
    The process we would like to follow this year is to try to 
reach consensus within the farm community, with commodity 
groups, and with the House and Senate members on both sides of 
the aisle on the basic ideas to reform crop insurance, and then 
address the budget issues.
    We recognize that it will be an expensive project. The 
Secretary has said it will cost at least $1 billion. We have 
been refining our budget estimates, and I hope to be able to 
testify on that in more detail over the next couple of weeks.
    But we do recognize that we do have to address the budget 
issues in order to accomplish legislation this year.
    Senator Cochran. One of the elements of a proposal that we 
have heard is that you are suggesting that $1 billion may be 
needed to subsidize premium costs to induce farmers to purchase 
revenue assurance policies. Is that going to be part of the 
proposal?
    Mr. Ackerman. Yes, that would be part of the proposal. The 
number of $1 billion, or ``at least $1 billion,'' would cover 
the entire package. As I said, we are refining what that 
overall number would be.
    But, clearly, the biggest expense item in either our 
package or any of the other proposals that have been discussed 
would clearly be toward creating better incentives for farmers 
to buy up to higher levels of coverage.
    One of the biggest problems we have had in crop insurance, 
in our experience last year as Mr. Schumacher mentioned, is too 
many farmers were either uninsured or underinsured. We found 
that those farmers who had catastrophic level coverage, for 
instance, tended to be very disappointed in that coverage in 
the event that they had real significant losses.
    We feel that revenue insurance should be fully supported. 
Under crop insurance currently it does not get a full subsidy, 
as with MPCI, multi-peril crop insurance.
    So yes, that is part of our package of proposals and, yes, 
that would have a significant budget impact.
    Senator Cochran. One of the problems in the South is that 
rating inequities put Southern farmers at a disadvantage, and 
that is a serious problem in the minds of a lot of producers in 
our part of the country.
    What can be done to deal with that in an effective way?
    Mr. Ackerman. I guess there are two parts to the answer on 
that. The fact that farmers find crop insurance not accessible 
enough, not affordable enough, is a general problem nationwide. 
We think that has to be addressed by creating better incentives 
through subsidy--through better targeting the subsidy system.
    But specifically on rates in the South, we recognize we 
have an issue with rates on cotton. Cotton planting patterns 
have changed a lot in the last few years, and a lot of the rate 
base on cotton goes back 10 or 20 years.
    We are doing a study specifically on our cotton rates right 
now and we have made that an agency priority. We have brought 
in some outside advisors, some outside university people to 
look at our rates. We have had a number of meetings with the 
National Cotton Council to discuss the rating system, and we 
expect that we will be able to report our findings to you 
probably within the next 2 or 3 months.
    Senator Cochran. Thank you very much. Your answers are very 
helpful.
    Mr. Ackerman. Thank you.

                      CONSERVATION RESERVE PROGRAM

    Senator Cochran. I have a series of questions now that deal 
with the Natural Resources Conservation Service. You may want 
to invite Mr. Reed to come forward to help answer these 
questions.
    It is my understanding that limitations placed on the 
Commodity Credit Corporation technical assistance funds are 
severely hampering the ability of the Natural Resources 
Conservation Service staff to provide technical assistance to 
land owners. If the section 11 cap, as it is called, is not 
fixed, what will be the impact on NRCS support for the 
Conservation Reserve Program?
    Mr. Reed. Senator Cochran, our estimate right now is that, 
based on the current dollars that are available, we have enough 
money to do CRP-type work, provide technical assistance, up to 
about the 15th of May.
    We estimate, based on what the Secretary plans to accept in 
the 18th signup, that we need approximately $28 million in 
order to provide the anticipated technical assistance that is 
needed.

                       NRCS STAFF YEAR REDUCTION

    Senator Cochran. For the record, I think we should identify 
the Chief of the Natural Resources Conservation Service, who is 
Chief Pearlie Reed. We appreciate your being here today.
    We understand also that the fiscal year 2000 budget request 
will result in a reduction of staff for the Natural Resources 
Conservation Service. What impact is this going to have on NRCS 
and its ability to carry out its functions as required by law?
    Mr. Reed. Well, based on basic soil and water conservation 
work that the policy makers in this country are expecting us to 
do and all of the additional things that the policy makers are 
putting on our plate, namely the massive animal waste workload, 
the emerging water quality issues, and global climate change 
initiatives, we are being asked to do too much.
    The proposed 1,055 staff year reduction for the NRCS for 
fiscal year 2000 will be something that will, quite frankly, 
get us in a position where we cannot deliver on those 
priorities that have been established for us.
    Senator Cochran. This may not be a question that you are 
supposed to answer, but I am curious to know how much funding 
would be necessary to add to the NRCS budget request to ensure 
that you have the staff to meet your responsibilities?
    Mr. Reed. Approximately $90 million over and above the 
fiscal year 1999 level for conservation technical assistance.

                          WATERSHED FACILITIES

    Senator Cochran. We recognize the fine work you have done, 
that the agency has done, over the last 40 years in putting 
flood control structures and other watershed projects in place 
that benefit local communities and production agriculture. Tell 
us, if you can, what you are going to do about the problem of 
maintenance requirements and the deterioration of these 
watershed infrastructure facilities. We understand that this is 
a problem, that because some of these structures were 
constructed so long ago, they now are not doing the job that 
they were expected to do, and are creating, in some cases, 
public safety and health risks. We need to know about this and 
what can be done about it.
    Mr. Reed. Mr. Chairman, starting in the late forties up to 
about 1962, under P.L. 534 and 566 and the RC&D program, we 
built approximately 10,000 or so dams out in the countryside 
that were designed to last for 50 years.
    Those dams have functioned as they were designed to 
function. Now they are filling up with sediment and they are to 
the point where there is a need out in the countryside for some 
major, major rehabilitation.
    I should add that it is really not a maintenance problem, 
it is not an operations problem. It is a problem with the 
system having functioned based on the life expectancy that the 
dams were designed for.
    Starting about 1962, we started to design these dams to 
last 100 years. So for those that were constructed since 1962, 
we have a little bit longer before we need to be concerned 
about their life expectancy.
    But the major thing right now is that I am of the opinion, 
we are of the opinion in the NRCS that we have a potential 
major public health and safety situation out in the 
countryside: the roads, the bridges, and other parts of the 
infrastructure out there, namely water supplies, recreation 
facilities. Indeed, a lot of development has gone in the flood 
plain below some of these structures.
    We are of the opinion that, if this issue is not addressed, 
it is just a matter of time before we have some major, major 
disasters--loss of life, loss of property, and all of the 
things that go along with that.
    Our lawyers tell us that it is not the NRCS's or Federal 
Government's responsibility for these projects, that it is a 
local issue. My concern is that it is a major public health, 
public safety issue, and I think it is our responsibility to 
bring that to the attention of the policy makers in this 
country and let them decide how best to deal with it.
    Senator Cochran. Is there any specific amount in the budget 
submission that is designed to deal with this problem, or to 
educate communities about the problem, or to do anything in 
regard to it?
    Mr. Reed. There is approximately $1 million for an 
education effort.

                         CONSERVATION PROGRAMS

    Senator Cochran. Let me ask you about some of the other 
programs that the agency is involved with.
    We know that, because of the economic problems in 
production agriculture, there are some programs that do provide 
some financial benefits to help farmers. I am curious to know 
your reaction to the benefits that are available and the 
sufficiency of these benefits. Conservation programs are some 
that have been very important to me personally, and we have 
been actively involved in trying to design the programs so that 
they are workable.
    I would like your reaction to these conservation programs. 
I have in mind the Wetlands Reserve Program, the Wildlife 
Habitat Incentives Program, which we were able to get 
authorized a couple of years ago; and EQIP, which has become 
very well known. Describe to us what is being done in the 
administration of these programs to help farmers.
    Mr. Reed. Let me just tick off the programs. Of course, the 
biggest one is CRP. Then we have the Wetlands Reserve Program, 
the WRP Program. In the President's budget we are proposing 
that a $5 million amount be made available for Debt for Nature.
    Senator Cochran. For what? I'm sorry?
    Mr. Reed. For Debt for Nature. Basically, that is a program 
that has been authorized but never funded that would provide 
technical assistance and financial assistance to farmers in 
such a way where maybe they could provide easements and things 
like that to offset certain kinds of debts.
    Senator Cochran. OK. Thank you.
    Mr. Reed. I would like to offer to provide for you for the 
record some specific examples of situations out in the 
countryside where farmers have been able to keep their farms, 
of farmers who are in situations where they have been able to 
get out of severe economic stress because of the WRP program, 
because of the Wetlands Reserve Program. But I am not prepared 
to talk about those specifically today.
    Senator Cochran. Okay. That would be helpful to have in the 
record and we would appreciate your submitting that for 
inclusion in the record.
    [The information follows:]

 Conservation Program Assistance to Producers During Times of Economic 
                                 Stress

    USDA Conservation Programs \1\ provide financial, technical, and 
education assistance to aid farmers and ranchers attain their 
conservation goals, comply with environmental requirements, and achieve 
longer term resource sustainability. These programs mitigate not only 
the vagaries of weather but also the violent shifts in agricultural 
markets while providing long term productivity gains and reduced 
reliance on purchased inputs. Several examples are cited below that 
depict how conservation programs assist producers during times of 
economic stress and over the long term.
---------------------------------------------------------------------------
    \1\ USDA conservation programs cited here include the Environmental 
Quality Incentives Program (EQIP), Wildlife Habitat Incentives Program 
(WHIP), Wetlands Reserve Program (WRP), and Emergency Watershed Program 
(EWP).
---------------------------------------------------------------------------
    Mississippi, Iowa, and Maine--EQIP helps producers reduce costs and 
contributes to long term income while providing environmental benefits.
    Regardless of the economic hardships being experienced by 
producers, there is an ever increasing number of local and State 
environmental laws and regulations that must be addressed. In Iowa. 
State legislation requires producers to stop using agricultural 
drainage wells for the disposal of agricultural land surface runoff. 
EQIP priority areas in Humboldt and Pocahontas Counties are being used 
to provide assistance for developing environmentally safe methods of 
runoff disposal and to comply with this legislation, while helping 
producers minimize costly outlays to meet this requirement. A similar 
State mandate in Mississippi requires the elimination of underground 
pits for the disposal of poultry carcasses. EQIP priority areas in East 
Central Mississippi and in the Upper Pearl River watershed are helping 
the small, family poultry farmers meet the new regulations.
    A second way that EQIP assists farmers in economic stress is with 
the establishment of natural resource conserving practices that 
maintain or enhance the long-term economic viability on the farm. 
Farmers under economic stress commonly make investments that provide 
near term income even though investing in conservation of natural 
resources can enhance longer term sustainability and economic 
potential. For example. the Passamaquoddy Tribe in Maine is using EQIP 
for forest and wildlife habitat conservation and management purposes 
that will ultimately improve their forestland income. They are also 
establishing integrated crop and pest management techniques with EQIP 
assistance that reduce reliance on costly agrochemicals while 
maintaining yields on their blueberry lands.
    The economic stresses stemming from adverse market conditions can 
often impact small, limited resource. and minority farmers more 
severely than larger operations with more capital. Limited resource 
farmers in Mississippi were found to have a higher percentage of their 
forest lands being inadequately managed or not reforested after 
harvesting because they had to invest their limited funds in farm 
operations with a quicker income return. EQIP has provided financial 
assistance to these limited resource producers for reforestation 
purposes that will primarily improve the local natural resources while 
helping longer-term economic returns.
WYOMING--flow WHIP provides supplemental income
    In Wyoming, thirty landowners in one country entered into WHIP 
agreements for land surrounding two state wildlife management areas. 
The State's wildlife areas are rich in water and wetlands, yet lacked 
upland bird habitat and nesting cover, and thus limited overall 
wildlife benefits. The land enrolled in WHIP provides the missing 
habitat for pintails, mallards, pheasant, and sharptails as well as 
neotropical migratory birds. In addition, the participants can lease 
their land during hunting season as a source of additional income and 
enterprise diversification. This, in turn, benefits the local economy.

    Senator Cochran. There is one parochial question on this 
subject that I wanted to bring up.
    The legislature in our State authorized $5 million from the 
sale of bonds last year to be used for the rehabilitation of 
watershed infrastructures. The State can only use this money if 
some match is provided from the Federal Government. That is the 
provision of the statute that the legislature passed.
    The agency has authorized a pilot project for the 
rehabilitation of an aging project. Would the agency consider 
Mississippi as a possibility for this pilot program?
    Mr. Reed. Absolutely. [Laughter.]
    But let me tell you that in the fiscal year 1998 
appropriations, you provided the authorization for us to do 
that and I think it was approximately $1 million. We have 
obligated those funds for this pilot project in the State of 
Oklahoma. So, as it has been explained to me by our lawyers, in 
order for us to proceed elsewhere with pilot projects, we would 
have to get the appropriate authorizations or appropriations to 
do so.
    Senator Cochran. Okay. We will work on that. Maybe we need 
some new lawyers. [Laughter.]

                              HONEY LOANS

    Let me ask you something, Mr. Secretary, about a revision 
that we put in the emergency appropriations title last year to 
the fiscal year 1999 appropriations bill that had to do with 
marketing loans for honey producers. It is not probably widely 
known, but Congress approved this program because honey 
producers, like many others involved in agriculture, faced 
seriously low prices. The Department has delayed implementing 
this program, and I am curious to know why.
    Congressman Skeen, who is chairman of the Appropriations 
Subcommittee on the House side, and I learned that the 
Department also had assumed to not implement the program in the 
manner intended.
    We wrote a letter recently to try to spell that out. We 
would like the delays to end, but we have not gotten a reply to 
our letter and no regulations implementing the program have 
been published.
    We would like to have regulations promulgated so that the 
Department could implement the program. Can we expect action on 
that? Or is there any reason why the Department is just 
refusing to carry out the provision of section 1122 of the 1999 
Agriculture Appropriations Act?
    Mr. Schumacher. Thank you. Again, with your permission, I 
would ask Mr. Parks Shackelford, who is running that program 
and is here today, to reply.
    Mr. Shackelford. I am the Associate Administrator for 
Programs at the Farm Service Agency.
    Actually, we very strongly intend to implement the program. 
The difficulty was that, unlike some of the other no net cost 
programs, this legislative language required that it be run at 
no net cost and did not provide an exemption for administrative 
costs.
    We have worked with the industry trying to determine a way 
that we can provide the loans at a reasonable cost to cover the 
administrative costs and still be workable to the industry.
    I think our staff has come up with some creative ideas--for 
example, the fact that we will be getting interest payments and 
can offset some of the costs.
    The regulation is in clearance. We hope it will be 
published very soon and that we will be able to get these loans 
out to the industry.
    Senator Cochran. Thank you.

                             COTTON PROGRAM

    Dr. Collins, we mentioned earlier in the hearing the Step 2 
Certificate Program for cotton. It seems to have worked very 
well to promote cotton exports overseas and to ensure that 
domestic mills have access to domestic cotton at competitive 
prices.
    Could I ask you a couple of questions about this? We 
observed, when we were talking about it earlier, that funds 
have been exhausted under existing authorities. What is the 
intention of the Department with respect to seeking additional 
funds?
    Mr. Collins. I do not think the Department has any stated 
position on that at this time, Mr. Chairman.
    Senator Cochran. What is your assessment of the value of 
these certificates to domestic cotton producers?
    Mr. Collins. I want to be very careful how I answer that 
because I remember a year ago you asked me that and I got a 
flood of mail afterwards based on my response. [Laughter.]
    I would say that there are a couple of things we could look 
at.
    One is what has happened since the Step 2 Program 
terminated in mid-December. What has happened since then is 
that we have only made a net increase of about 100,000 bales in 
sales of cotton--that is the sales minus the cancellations we 
have had since then. That would be, by all historical 
standards, a very poor performance on export sales.
    So I would have to say that the world has been looking for 
a Step 2 payment this year for us to be able to sell cotton. So 
this is a year in which the Step 2 Program would have made a 
big difference.
    As we look out to 1999, however, I think the effect would 
be lessened. This is a year in which we had a very small crop 
in the United States but we had large supplies around the 
world. As a result, we had the unusual situation of low U.S. 
supplies and low prices. These do not usually come together.
    As we look out to 1999, we may see a situation where we 
have large U.S. supplies but again low prices. With those large 
U.S. supplies, I think we would be in a better position to 
compete, and I think the effect of the Step 2 program probably 
would not be great.
    However, there is an effect. I mean, I think it does 
increase domestic mill use and it does increase export sales. 
But it depends on the world conditions in each season as to how 
effective it would be.

                             CROP INSURANCE

    Senator Cochran. During the last brief recess we had, the 
so-called President's Day Recess, I ran into a few of my 
friends who are in the cotton business, cotton growers. They 
think that the Step 2 program is something that they really 
need, and they would like very much to have it extended.
    For the first time, I understand we have a new crop 
insurance product called Crop Revenue Coverage, offered for 
sale in our State for rice producers. We have received a number 
of calls from producers about this product, and there is some 
concern that the availability has influenced planting decisions 
and may have affected the rice market.
    This coverage, as I understand it, does not serve as a 
price guarantee for the quantity of rice a farmer produces. In 
other words, it is not similar to a put option. Is that 
correct?
    What are your thoughts about the influence and the 
availability this product has had on planting decisions and 
market prices?
    Mr. Ackerman. Senator, as for the product you are referring 
to, there are two related products. So it is important to 
distinguish.
    There is a product called Crop Revenue Coverage which is a 
widely available product on a number of crops. But this is the 
first year it has been offered for rice. It is different than a 
put option.
    What it does is give a farmer a guarantee on their revenue. 
In other words, it will cover you if prices move down, but only 
if your revenue, the price times yield, falls below a certain 
floor.
    It will also give you a protection if the price moves 
upward.
    This is different than a put option because a put option is 
based on the price standing alone. CRC, as an insurance based 
revenue product, is based on price times yield. This is a 
product that we reinsure, back, subsidize, and that we are very 
fully engaged in.
    There is an additional product that is a private sector 
product offered by the same company, called CRC Plus. CRC Plus 
is what is called an add-on product which basically enhances 
the price guarantee. In this case, it does it, I believe, by 3 
cents.
    There were some concerns that, because of changes in the 
rice price since the time the prices for these tools were set 
several months ago, that may have influence on some planting 
decisions by farmers.
    CRC Plus is a product that we do not reinsure. It is a 
purely private product. The only review function we have for it 
is to see whether it impacts the risk borne by the Government 
on the underlying product.
    At this point, I can tell you the sponsoring company is 
reviewing the situation. They are considering a number of 
options. We have not seen any direct indication that CRC Plus 
is affecting rice prices.
    Obviously, the availability of any insurance tool, if it is 
a good insurance tool, would be to give farmers more confidence 
to plant a crop. If it is having that kind of beneficial 
impact, that may not necessarily be a problem. But it is a new 
tool. Like many of the new revenue tools, we are learning by 
experience this year because we are dealing in a time of 
volatile prices and we have a new generation of crop insurance 
products on the market today that are price sensitive. We are 
learning a lot of lessons this year about how they operate when 
markets are volatile, particularly when market prices change 
after the initial prices are set on products.
    We have had that happen before with traditional crop 
insurance products if we set a price election on a crop and 
then the market moves away from it. When you have a price 
sensitive product, that concern can be compounded.
    We are tracking this very closely. We have been in very 
direct contact with the companies, simply to be on top of the 
situation. But CRC Plus is a purely private product.
    Senator Cochran. Thank you.

                     MONITORING FOOD AID TO RUSSIA

    Mr. Schumacher, in your statement which you submitted to 
the Committee you point out that the United States and Russia 
have established a monitoring program, which is new and 
unprecedented, to help ensure that food aid reaches the 
populations for which the aid is intended.
    Could you describe this program and how it works? Or, is it 
working to get the food aid to the targeted populations?
    Mr. Schumacher. Yes. It has been really an unprecedented 
monitoring system that we put in place. The first shipments of 
seeds should arrive in St. Petersburg on March 12 and we'll be 
kicking in the monitoring as that starts. We've put enormous 
effort into ensuring that the agreements that we have signed 
with the Russian Government will be adhered to and we'll know 
where this product is going.
    With your permission, I will ask Mr. Goldthwait to take a 
minute or two to go into the very important details to assure 
all of us that this is going to take place well.
    Senator Cochran. All right.
    Mr. Goldthwait. Senator Cochran, the monitoring and 
oversight program has actually three parts to it.
    First of all, there is an element that the Russian 
Government itself is undertaking. They are setting up a special 
unit within the Ministry of Interior basically to do individual 
tracking of the shipments within Russia. That is what they are 
doing.
    What we are doing has two components. It has what I call a 
real time reporting component where, instead of getting all of 
our reporting on the disposition of commodities after the fact, 
traditional in USDA food aid programs, we are actually going to 
be getting reporting on the discharge of the commodities within 
48 hours after they reach the Russian ports and the movement of 
the commodities on an ongoing basis to, ultimately, their 
endpoint of disposition.
    That is the second element.
    The third element is an extensive spot checking effort, 
actual people on-site, going out and, first of all, talking to 
the people that are to receive the commodities before the 
commodities are going to be delivered, alerting local media as 
to what to expect. Then the people will actually be observing 
the discharge of commodities at the ports, visiting the 
railheads and storage locations as they are distributed 
internally, and, ultimately, going to the end delivery point 
and observing the commodities as they arrive in the designated 
regions.
    The actual plan for the disposition of the commodities for 
all of the commodities is available on the FAS website.

                     FISCAL YEAR 2000 FSA STAFFING

    Senator Cochran. Thank you.
    Mr. Schumacher, the Administration's supplemental funding 
request, which was submitted last week, includes $42.7 million 
for Farm Service Agency salaries and expenses to accommodate 
the increased county office workload.
    Does the fiscal year 2000 budget request accommodate the 
agency's workload requirements as well? Will it result in any 
staff reductions?
    Mr. Schumacher. Yes, the fiscal year 2000 budget includes a 
reduction of 752 in staffing.
    Senator Cochran. That's 752 staff years?
    Mr. Schumacher. Yes, 752 FTE's, full-time equivalent staff-
years. That's a reduction in the budget for the year 2000 for 
permanent employees.
    Senator Cochran. What will be the practical consequences of 
that? Will farmers suffer because of that, the programs?
    Mr. Schumacher. We are going to be looking hard at 
additional forms of efficiency. We will be going through an 
administrative convergence to make sure that, as we move 
forward into some consolidation, we're putting people behind 
counters and not in administrative offices. However, sometimes 
we have county offices that are very thinly staffed, and we can 
do better if we combine two offices. We will work closely with 
Congress on these proposals.
    So we are making some efficiencies there as well, sir.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Cochran. I have some additional questions and other 
members of the Committee may, as well, which I will submit. I 
request that you respond in writing in a timely fashion.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted by Senator Cochran
                          farm ownership loans
    Question. The fiscal year 2000 President's budget request proposes 
an increase of $42,400,000 in budget authority for direct farm 
ownership loans resulting in an increase to provide 500 additional 
loans for minority farmers and to help reduce the backlog of unfunded 
loan applications. What is the current backlog that exists for direct 
farm ownership loans?
    Answer. There are 1,214 direct farm ownership loan applications on 
hand as of March 2, 1999.
                   agricultural conservation program
    Question. There has been a $33,300,000 carry over balance available 
for the Agricultural Conservation Program for several years now. Why 
hasn't this money been used for ACP cost-sharing agreements and when 
does the agency expect this money to be obligated?
    Answer. The Federal Agriculture Improvement and Reform Act of 1996 
repealed the ACP and incorporated its objectives into the Environmental 
Quality Incentives Program. The remaining funds are available only for 
valid prior years' obligation adjustments.
    Question. When will all cost-sharing agreements be completed?
    Answer. The last multi-year cost-share agreement was entered into 
during fiscal year 1996 for water quality incentive practices. Those 
practices are completed over a 3- to 15-period. The last ACP long-term 
agreements were entered in fiscal year 1995 and are contracts for 3 to 
10 years.
                        tree assistance program
    Question. The unobligated balance of $3,200,000 brought forward 
from prior years for the Tree Assistance Program is available for use 
in fiscal year 1999. Does the agency plan to use these funds in fiscal 
year 1999?
    Answer. The unobligated balance of $3,200,000 brought forward from 
the prior years for the Tree Assistance Program will be used in fiscal 
year 1999. Any unobligated balance at the end of fiscal year 1999 will 
expire according to Public Law 105-277.
    Question. If yes, then for what purposes?
    Answer. This funding will be used to provide cost-share payments to 
orchard and vineyard growers who suffered losses due to fire blight 
infestation (a destructive disease caused by bacteria) that was caused 
by a natural disaster.
                      loans for irrigation systems
    Question. The Committee conference report accompanying the fiscal 
year 1999 Agricultural Appropriations Act states that the conferees 
expect USDA to provide guaranteed loans for installing irrigation 
systems for farmers in areas declared a disaster due to droughts. Have 
any loans been provided for this purpose? If not, why?
    Answer. Providing funds to install irrigation systems is an 
authorized purpose for guaranteed loans. FSA does not gather data on 
the use of loan funds for specific purposes, so we are not able to 
fully respond to this question.
                           livestock pricing
    Question. Hog Prices have dropped as low as $7 per hundredweight in 
some parts of the country. Cattle prices reached around $80 per 
hundredweight at the first of the year, and have hovered in the $60-70 
range in some parts of the country. Does USDA have any plans to provide 
any emergency relief to cattle farmers?
    Answer. USDA recently authorized $20,000,000 of section 32 funds to 
support the beef industry. USDA is currently purchasing beef roasts and 
ground beef. In fiscal year 1999, USDA has purchased $66,000,000 worth 
of beef with Section 32 funds to fulfill entitlement needs for the 
1998-99 School Lunch Program.
    Question. What authority does USDA have to assist the livestock 
industry?
    Answer. The Agricultural Marketing Service assists the livestock 
industry under Section 32 of the Act of 1935 (Public Law 320).
           suspension of loans for hog production facilities
    Question. The Federal Register contained a notice on January 26, 
1999, that temporarily suspends direct Rural Economic Development Loan 
and Business and Industry Guaranteed Loan financing for the 
construction of specialized facilities used for the production of hogs. 
How many loan applications will be affected by this suspension?
    Answer. In addition to the suspension you mentioned, on January 8, 
1999, FSA suspended direct and guaranteed loans for construction or 
expansion of specialized facilities used for the production of hogs. We 
do not know how many applications were affected by these temporary 
suspensions.
    Question. Will these applications be considered for funding once 
the suspension is lifted or will all appropriations be obligated by 
that time?
    Answer. When the suspensions are lifted, applications will be 
considered for funding. The suspensions are indefinite in duration so 
it is impossible to say what the availability of funds will be when 
they are lifted.
    Question. What will be the determining factors to lift this 
suspension?
    Answer. The suspensions will be lifted when the Secretary 
determines that resumption will not contribute to oversupply and 
continue to depress hog prices.
              small hog operations payment program (shop)
    Question. Many hog farmers claim that the $50,000,000 assistance 
that will be provided to them is too small to help medium and large hog 
producers. Was this assistance directed towards the smallest producers?
    Answer. The Small Hog Operations Payment Program (SHOP) was 
directed towards small hog operations, which may or may not be an 
individual producer.
    Question. How is a ``small producer'' defined by USDA?
    Answer. A small hog operation is defined as any hog operation whose 
gross income for 1998 was $2,500,000 or less. The operation must also 
have marketed less than 1,000 hogs during the last 6 months of 1998 and 
must still be in business.
    Question. Is USDA considering additional emergency assistance for 
small and medium-sized producers?
    Answer. Approximately $50,000,000 of Section 32 funds were 
authorized for SHOP. The Section 32 provisions invoked permit direct 
payments to farmers to reestablish their purchasing power. If 
additional assistance is needed to help hog farmers reestablish their 
purchasing power, providing additional Section 32 program assistance 
would be considered.
                     delivery of emergency programs
    Question. Please give an update on the delivery of the following 
emergency programs: wool and mohair recourse loans, honey recourse 
loans, indemnity payments for cotton producers, and emergency 
assistance provided in Title IX, Section 1124.
    Answer. There are no programs available for wool. The CFR 
regulations for honey and Mohair Recourse loan programs were filed on 
March 3, 1999. Notice LP-1673, instructing county offices to publicize 
the programs, accept applications and disburse loans was issued to 
State Offices on March 4, 1999. Application forms for both programs are 
available on the FSA electronic bulletin board system. The forms are 
also available to applicants with Internet access on the Price Support 
Division web site (www.fsa.usda.dafp.psd).
    In terms of indemnity payments for cotton, USDA was to make a 
$5,000,000 payment to the State of Georgia to help fund an indemnity 
fund, which was to be established and managed by Georgia, to compensate 
cotton producers in Georgia for losses incurred in 1998 or 1999 as a 
result of bankruptcy of a warehouseman or other party. In order for 
USDA (CCC) to pay Georgia the $5,000,000, Georgia was required to 
contribute a matching $5,000,000. Georgia has until July 1, 1999 to 
establish the fund and until January 1, 2000 to make all the payments.
    To do this, Georgia had to pass a law allowing it and to 
appropriate the funds. The Georgia legislature has passed the law and 
drawn up the paperwork to appropriate the funds, and the documents were 
still awaiting signature by the Governor. If the fund is not 
established by Georgia by July 1, USDA shall make available our 
$5,000,000 to provide partial compensation to cotton producers.
    Funding for emergency assistance shown in the fiscal year 1999 
Appropriations Act, Section 1124, was further broken down in Section 
763. As required in Section 763, paragraph b, $27,000,000 was 
transferred to the Secretary of Commerce, $20,000,000 was transferred 
to the Economic Development Administration, and $7,000,000 was 
transferred to the National Oceanic Atmospheric Administration. An 
additional $5,000,000 was transferred to the Small Business 
Administration, in accordance with Section 763, paragraph c. We are 
also working with the State of Alaska to offer $18,000,000 in emergency 
aid to individuals with family incomes below the federal poverty level 
in connection with fishery failures.
                               farm loans
    Question. The Secretary of Agriculture announced that USDA will 
postpone certain loan payments for farms suffering severe financial 
distress from low prices. The loan deferment announcement included 1998 
farm ownership and operating payments due January 1, 1999. These 
payments will instead be added at the end of the repayment period along 
with loan servicing authorities, including debt rescheduling and 
forgiveness, to assist farmers. What will be the cost of delaying these 
payments, if any?
    Answer. We estimate that there will be no additional cost to the 
Government as the amount set aside continues to accrue interest at the 
note rate and will be due and payable when the loan matures.
    Question. Besides the 1998 farm ownership and operating payments 
due January 1, 1999, what other loan payments will be postponed by this 
deferment?
    Answer. All FSA Farm Loan Program loans may receive disaster set-
aside. These include payments on Farm Ownership, Operating, Soil and 
Water, Emergency, Economic Emergency and Rural Housing loans for farm 
service buildings that were impacted by the 1998 disasters and low 
commodity prices. Non-program farm type loans may receive disaster set-
aside if the borrowers also have any of the regular Farm Loan Program 
loans types listed above.
    Question. The fiscal year 2000 President's budget request proposes 
an increase of $28,000,000 for emergency loans for a total of 
$53,000,000 in program level that will provide about 852 loans. Based 
on the fiscal year 1999 demand for emergency loans and the supplemental 
request, is the fiscal year 2000 request for this program still 
appropriate?
    Answer. It is not possible to predict the frequency and severity of 
natural disasters. Hopefully, normal weather patterns will be prevalent 
in fiscal year 2000, and the high demand for emergency loans 
experienced in fiscal year 1999 will not be repeated.
    Question. In the fiscal year 1999 Appropriations Act, the 
limitation on the amount of both a farm ownership and an operating loan 
was raised to $700,000. How has this affected the type of loans that 
are being made? Are larger loans being made to fewer people?
    Answer. Yes, larger loans are being made to fewer people. Thus far 
in fiscal year 1999, the average loan amount has increased. Farm 
ownership loans increased 12 percent (from $177,127 to $199,053) and 
operating loans increased 14 percent (from $123,879 to $141,287).
    Question. To what extent has this change contributed to the 
increased demand/shortfall of fiscal year 1999 emergency funds for 
these loans?
    Answer. For the past 8 years, the average loan size has been 
increasing 2 to 5 percent each year. We believe the increased loan size 
has contributed to exhausting our loan funds so early in the year.
    Question. Many banks that lend to farmers are turning away those 
that are on the brink of losing everything, so there is an increasing 
demand for USDA farm credit loans. How is this affecting the demand for 
USDA's direct and guaranteed farm operating and ownership loans and the 
availability of funds?
    Answer. Demand for both direct and guaranteed loans has increased 
significantly in fiscal year 1999 compared to fiscal year 1998 due to 
low commodity prices and numerous natural disasters. Due to this growth 
in demand for FSA farm loan assistance, there will be a shortage of 
funds in all FSA direct and guaranteed loan programs in fiscal year 
1999. On February 26, the President requested supplemental funding to 
provide an additional $1,100,000,000 in financing to farmers and 
ranchers.
                                 cotton
    Question. Funds for the Step 2 competitiveness provision for cotton 
were exhausted in December, 1998. USDA announced a special import quota 
under Step 3 on Thursday, February 25, 1999. In the absence of 
additional Step 2 funds do you expect domestic cotton consumption and 
exports to decline for the 1999/2000 marketing year?
    Answer. USDA has not yet published the official 1999/2000 
projections for cotton in the monthly World Agricultural Supply and 
Demand Estimates (WASDE) report. However, at USDA's recent Agricultural 
Outlook Conference, estimates placed 1999-crop domestic mill use for 
all kinds of cotton at between 10,000,000 and 10,500,000 bales, roughly 
the same as the level now expected in 1998/99. Exports of cotton for 
1999/2000 were estimated at the conference to range from 5,000,000 to 
6,000,000 bales. This would represent an increase of between 600,000 
and 1,600,000 bales (about 25 percent) from the exports estimated for 
1998/99. Ending stocks of cotton for 1999/2000 are projected to 
increase about 2,000,000 bales, to about 5,400,000 bales, an increase 
of nearly 60 percent from the carryover stock level from 1998/99.
    Question. Will Step 3 import quotas continue to open on a weekly 
basis and if so, for how long?
    Answer. Step 3 import quotas will continue to trigger as long as 
the Friday-Thursday average U.S. quotation for middling 1-3/32'', 
delivered C.I.F. northern Europe, exceeds the northern Europe index by 
3.00 cent per pound or more. The spread between the U.S. quote and the 
northern Europe index for the current crop is now about 15 cents. On 
Tuesday, March 15, the first indication of the forward-crop prices was 
published. Though there was some improvement noted in the competitive 
position of U.S. cotton, the spread still appears to be about 10 cents. 
Thus, the Step 3 quotas can reasonably be expected to continue 
triggering for many weeks.
    Question. In the absence of additional Step 2 funds, does USDA have 
any authority which, if utilized, would make US cotton more competitive 
and which would serve to close import quotas?
    Answer. Both Step 1 and Step 3 still are in effect. By its design, 
Step 3 is supposed to start and stop automatically with no action 
required of--or permitted to--USDA. It has started this year at a time 
when it was needed. The actual importation of cotton likely will stop 
when the cotton is no longer needed. We cannot stop the continual 
announcements of new, unneeded import quotas. Since the adjustment of 
the U.S. northern Europe quote will be zero in the absence of Step 2, 
only the market can stop those superfluous announcements. Under Step 1, 
USDA has authority to reduce the marketing loan repayment price, also 
known as the ``adjusted world price'' or AWP, whenever the U.S. 
northern Europe quotation exceeds the northern Europe price, as long as 
the calculated AWP is less than 115 percent of the loan rate. (We use 
the ``A'' Index to represent the northern Europe price.) Factors to be 
considered in determining whether a Step 1 adjustment should be made 
are specified in the law. They are: (1) the U.S. share of world 
exports, (2) the current level of cotton export sales and cotton export 
shipments, and (3) other relevant data, as available. Under that last 
category, we at USDA have considered the volume of loan activity to be 
very important.
    The theory behind the adjustment of the AWP under Step 1 is that 
the authority can be used when it becomes clear that cotton is being 
maintained in the loan program and is not flowing into the market. The 
competitive position of U.S. cotton is being hurt as a result of the 
impediment to flow. With larger loan deficiency payments or gains from 
the lower loan repayment price, farmers are believed likely to forgo 
loans or redeem loans. Cotton will become available to the market. 
Competitiveness will be served.
    We have no experience that would tell us if this theory is valid. 
The few instances in which Step 1 was invoked in the 1991 crop year did 
not appear to affect loan activity. However, the provision had just 
recently been enacted, and it is possible that it was not used 
aggressively enough. It does increase budget exposure, and that always 
has been an important consideration. Between January 1994 and December 
1997, Step 1 adjustments were not possible because the AWP was too 
high.
    There are two schools of thought on the implementation of Step 1 
adjustments: (1) Step 1 adjustments to the AWP should be used sparingly 
and intermittently to entice farmers to redeem loans or forgo loans as 
needed to relieve temporary constrictions in market flow; or (2) Step 1 
should be incorporated into a larger pricing strategy designed to 
enhance U.S. competitiveness in world cotton trade.
    Under the first approach, if heavy loan placements appear imminent, 
it is argued that a reduced AWP could help move cotton into the market 
instead of to the loan. These results are predicted because farmers 
will perceive either that they will earn a larger marketing loan gain 
if they redeem loan cotton or that they will earn a larger LDP by 
deciding not to place the cotton in the loan. Under this line of 
reasoning, the key ingredient for Step 1 to work properly is 
uncertainty. Farmers should never be sure whether USDA will again 
announce a Step 1 adjustment in the following week. Therefore, to take 
advantage of the increased benefit, they must move in the current week. 
One thing we have learned recently concerning this approach is that, 
once farmers become cognizant of the mere possibility that Step 1 might 
be invoked, they tend to hold their cotton off the market so they do 
not ``miss'' the extra benefit. This defeats the purpose of Step 1.
    Under the second approach, Step 1 should be operated during a 
specific period to provide ``carry-plus'' so that U.S. cotton can be 
offered in world trade at more competitive prices. The AWP would float 
at some level under where it would regularly be. The loan deficiency 
payment rate or gain from marketing loan redemptions would be constant 
from week to week, while the AWP would fluctuate from week to week, as 
it does now. This approach would, in effect, move the pricing structure 
downward and should contribute to competitiveness. It would not 
encourage speculative holding, as the first approach appears to do. 
Under this approach, Step 1 could function in the same general manner 
as Step 2 had functioned before the funding went dry, i.e., as a means 
of reducing the U.S. price level in both domestic and international 
trade.
                        loan deficiency payments
    Question. There is a $750,000 per ``person'' limitation on 
cumulative loan deficiency payments (LDPs). During 1998, USDA took 
action which increased eligibility for LDPs (silage and high aflatoxin 
corn) and the amount of LDPs (adjustments to the county-posted price). 
As a result of these actions, does USDA expect some commodities pledged 
as collateral for CCC loans to be forfeited as producers hit the 
payment eligibility limits?
    Answer. Department commodity analysts do not expect appreciable 
amounts of grain, soybeans or cotton to be forfeited from the 1998 
crops. There may be individual producers whose operations are of such a 
size that they may reach the $75,000 limit on loan deficiency payments 
(LDPs) and marketing loan gains, but most will not.
    Using LDP rates determined recently, over 2,000 acres of soybeans 
would be required to generate a payment of $75,000 at the national 
average yield. In the Mississippi Delta and the Southeast, with the 
poor yields of 1998, between 3,000 and 4,000 acres of soybeans would be 
required. At the height of the corn LDP about 6 weeks ago, to hit the 
$75,000 limit would have required over 3,000 acres of corn in the Delta 
and over 4,000 acres in the Southeast. In the case of cotton, about 
1,000 acres would be required to generate loan deficiency payments of 
$75,000 in the Mississippi Delta or the Southeast.
    Most farms have more than one of these commodities planted. The 
acreage required to reach the $75,000 limit is, therefore, something 
over 1,000 acres. Most producers have had a chance to organize their 
operations so that they have avoided large acreage on a single 
operation. Most have had a chance to avail themselves of the ``three-
entity'' rule, effectively doubling the acreage required to hit the 
limit. The analysts do not expect the payment limit to affect many 
producers or cause the forfeiture of many bushels or bales.
    Question. Does USDA expect to require some producers to repay LDPs, 
resulting from audits which identify overpayments?
    Answer. Yes, some producers will be required to repay their LDP's 
if an overpayment occurred.
    Question. Does USDA expect to advise some producers with 
commodities still under loan that they cannot redeem those commodities 
at the world price even though the commodities have been contracted for 
future delivery using USDA approved options contracts?
    Answer. If a producer should reach the $75,000 limitation of LDP or 
marketing loan gains, no further marketing loan gains could be 
permitted that producer for 1998-crop commodities. In that case, the 
producer would be informed that 1998-crop loans could no longer be 
redeemed at reduced rates, such as the AWP, in the case of cotton.
    Question. Under the cost reduction authority of current farm law, 
does USDA have authority to forgive interest and loan principal on 
commodities under loan?
    Answer. We have determined that loans could be repaid at less than 
the original loan rate under the cost reduction option.
    Question. If so, what conditions would warrant the use of that 
authority?
    Answer. Under the provisions of Section 1009 of the Food Security 
Act of 1985, as amended, the redemption amount due on a commodity loan 
may be reduced if the reduction will cause a saving to the Federal 
Government of: (1) interest receipts that otherwise might be lost; (2) 
receipts of loan principal that would be lost if the collateral were 
forfeited in satisfaction of the loan; or (3) reduction or elimination 
of handling, storage, and carrying charges that otherwise might accrue 
to the Government because of a forfeiture.
    Question. Is USDA contemplating the use of that authority for any 
commodity in the immediate future?
    Answer. No, we are not anticipating using that for any commodity in 
the immediate future.
                           acreage reporting
    Question. What is the current status of acreage certification by 
the Farm Service Agency (FSA)?
    Answer. Producers are required to certify acreage for the following 
benefits:
  --Production Flexibility Contract Payments--fruits and vegetables
  --Loans and LDPs--Acreage of the crop for which a loan or LDP is 
        being requested
  --CRP annual rental payments--CRP acreage according to CRP-1 appendix
  --NAP--Crop acreage for which a NAP benefit may be requested
  --Quota Tobacco and Peanuts--All quota tobacco, except burley, and 
        peanuts
    Question. If producers voluntarily report acreage, what action is 
taken by FSA?
    Answer. County offices accept FSA-578's from all producers who wish 
to report their acreage for any FSA program purpose.
    Question. Are there requests for FSA acreage data by other agencies 
or organizations?
    Answer. The National Agricultural Statistics Service (NASS) uses 
the data to evaluate the accuracy of acreage surveys done annually. FSA 
acreage totals are used as a secondary source of State and national 
crop estimating programs. They also use the data when allocating State 
estimated in support of county estimates programs.
    Private insurance companies, reinsured by Risk Management Agency 
(RMA), use and rely on FSA acreage to verify crop insurance acreage 
information reported by producers.
    FSA also provides acreage and production information related to the 
tobacco and peanut programs to RMA electronically for use by private 
crop insurance companies. This program allows producers to obtain crop 
insurance without providing production certification to companies.
    Natural Resources Conservation Service uses FSA acreage information 
to develop producer crop rotation plans for compliance with the highly 
erodible land conservation provisions.
    The Boll Weevil Eradication Program, administered by the Animal and 
Plant Health Inspection Service, has historically relied heavily on the 
FSA acreage information.
    Question. Is USDA cooperating with NASA in the development and 
utilization of cropping and other data collected by satellites?
    Answer. In April 1998, a Memorandum of Understanding (MOU) was 
signed by the Secretary of Agriculture and Administrator of NASA. The 
MOU provides a framework for cooperation and coordination to facilitate 
research, development, transfer, and utilization of satellite data in 
implementing precision agriculture techniques and managing resources. 
Following the signing of the MOU, USDA helped NASA identify research 
priorities in the areas of agriculture, forestry, and range resource 
management. NASA offered to fund research in these priority areas in a 
NASA Research Announcement which drew about 180 research proposals from 
the national remote sensing community. By March 1999, through a series 
of panels--co-chaired by USDA and NASA--those proposals, that 
demonstrated the most potential for developing improved remote sensing 
applications were selected for funding.
                       livestock price reporting
    Question. Secretary Glickman has stated that there is a need for 
greater authority to require packers to report livestock and meat 
prices through a mandatory program. He also has indicated that he plans 
to take ``specific steps'' to collect additional price information 
under existing law. Does the Department have a legislative proposal to 
submit to Congress to grant USDA the authority to require livestock 
price reporting?
    Answer. USDA has drafted proposed legislation to grant USDA the 
authority to require mandatory livestock price reporting. The proposed 
legislation currently is at OMB for clearance.
    Question. What ``specific steps'' under existing law will the 
Department take to help determine if there is evidence of price 
manipulation or unfair pricing activity by packers? What are the 
existing authorities for these ``specific steps''?
    Answer. The Grain Inspection, Packers and Stockyards Administration 
(GIPSA) has broad authority to collect information from subject firms, 
conduct investigations, and interview parties to carry out its 
enforcement responsibilities under the Packers and Stockyards (P&S) 
Act. GIPSA will use transaction data collected under the mandatory 
reporting pilot investigation included in USDA's fiscal year 1999 
appropriation to investigate pricing issues affecting the cattle and 
sheep industries. In the hog industry, GIPSA is conducting an 
investigation of hog procurement contracts and marketing agreements to 
assess their use and reasons for price differences among producers.
    Question. It has been reported that a Federal investigation last 
year showed that the prices meatpackers report for hogs are lower than 
the actual transaction prices. I have also heard that Secretary 
Glickman is seeking a Justice Department probe into possible hog price 
fixing, and USDA is investigating price spreads between farms, packers, 
and retailers. When will the Department finish the investigation?
    Answer. GIPSA's Western Cornbelt Hog Procurement Investigation, 
which was completed last year, showed that the quality of a ``base 
hog'' as reported in public market news reports was lower than the 
average quality of hogs purchased by packers. Thus, prices reported for 
a ``base hog'' were lower on average than actual transaction prices 
during the period of the investigation. Secretary Glickman has asked 
the Department of Justice and the Federal Trade Commission to examine 
the current record price spread in pork. USDA's investigation of price 
spreads was initiated as a result of Secretary Glickman's Pork Crisis 
Task Force. A time frame for completion of this investigation has not 
yet been set.
    Question. How have the low prices that farmers are receiving for 
their hogs been affected by this ``possible hog price fixing''?
    Answer. USDA has not alleged that low prices for hogs resulted from 
``possible hog price fixing.'' A large supply of hogs was and continues 
to be the most important factor pressuring prices. Other factors likely 
played a role in the precipitous price drop seen at the end of 1998, 
and USDA is committed to determining whether practices in violation of 
the P&S Act played a role.
    Question. What other activities have been undertaken by the 
Department to address this issue?
    Answer. USDA has undertaken a number of activities to address the 
issues raised by the recent hog price crisis. In addition to an 
investigation of price spreads, GIPSA is conducting a comprehensive 
review of hog contract provisions and a review of recent hog slaughter 
plant closings.
                             meat labeling
    Question. A National Cattlemen's Association survey indicates 78 
percent of consumers polled want to know where their grocery meat comes 
from. What is the Department's position on country-of-origin meat 
labeling?
    Answer. Currently the Department does not have an official position 
on country-of-origin labeling for meat and meat products.
    Question. How will this affect the cost of meat to consumers?
    Answer. We are not sure of the effect of country-of-origin meat 
labeling on the cost of meat to consumers since we have not conducted 
any consumer cost analysis.
    Question. What, if any, actions has the Department taken regarding 
this issue? If not any, does the Department have any plans to take 
action in the future?
    Answer. As directed by the Omnibus Consolidated and Emergency 
Supplemental Appropriations Act for Fiscal Year 1999, USDA is 
conducting a study of the potential effects of mandatory country-of-
origin labeling on imported beef and lamb muscle cuts. As part of this 
study, USDA will review the regulations and policies governing USDA 
grading of imported meat and the use of the U.S. grade stamp on meat 
imported into the U.S. We plan to submit the report to Congress in 
April, as directed.
              dairy production disaster assistance program
    Question. An additional $3,000,000 was appropriated in the fiscal 
year 1999 Appropriations Act for the dairy production indemnity 
program. Has this money been distributed to dairy farmers?
    Answer. Yes, and approximately $750,000 of that remains 
undesignated.
    Question. Geographically speaking, which States in the country 
benefitted from this additional assistance?
    Answer. California received approximately $1,400,000, New York 
received $200,000, and Georgia and Florida received approximately 
$150,000 each.
    Question. What was the average payment for a qualified dairy 
farmer?
    Answer. The average payment was approximately $7,775 per dairy 
operation.
                        dairy market assistance
    Question. The fiscal year 1999 Agriculture Appropriations Act 
provides $200,000,000 in disaster assistance for dairy producers. The 
law gives the Secretary of Agriculture the discretion to distribute 
this assistance in a manner that he sees fit. How is this assistance 
being allocated and distributed to dairy farmers given that dairy 
prices were at a high last year and are predicted to fall in 1999?
    Answer. The Agriculture, Rural Development, Food and Drug 
Administration, and Related Agencies Appropriations Act, 1999, provides 
that $200,000,000 shall be available to provide market loss assistance 
to dairy farmers in a manner determined by the Secretary. The record 
high milk prices of last fall have been replaced with below average 
prices. The Basic Formula Price (BFP), which is the price that the 
Federal Milk Marketing Order system sets for milk used in manufacturing 
and is the price mover for fluid milk, declined from $16.27 per cwt in 
January to $10.27 per cwt in February. The $6.00 decline from January 
to February is more than twice the previous record monthly drop of 
$2.52 per cwt in November 1996. The February BFP is over $2 below the 
past 5-year average BFP in February--$12.51 per cwt. However, the drop 
will not be fully reflected in milk checks until April due to the lag 
in fluid milk price changes. The sudden plummet in the BFP resulted in 
a sense of urgency to get immediate and direct help to dairy farmers in 
a timely fashion.
    USDA will make payments under the Dairy Market Loss Assistance 
Program based on a dairy operation's first 26,000 cwt of milk produced 
and marketed in either 1997 or 1998, whichever is the highest. Targeted 
to family-sized operations, the amount of eligible production is about 
the annual production of a herd of 150 cows. The final payment rate per 
cwt will be calculated after signup ends, but USDA expects the rate to 
be between 18 and 20 cents per cwt and the maximum benefits to be about 
$5,000 per dairy operation.
    Question. What criteria has the Department developed to determine 
which farmers are eligible to receive this assistance?
    Answer. All dairy operations that produced and commercially 
marketed milk from cows in the United States from October 1998 to 
December 1998 are eligible.
    Question. What is the time line for the delivery of this program 
assistance to eligible farmers?
    Answer. Producers must apply at their local Farm Service Agency 
office between April 12 and May 21, 1999. Payments are expected to be 
made in mid-June.
                            grocery mergers
    Question. Across the nation, we are seeing consolidation in all 
areas of business. The supermarket industry is no exception. What 
impact will the consolidation of this industry have on prices paid to 
farmers for their goods and the prices charged to consumers?
    Answer. At the national level, the concentration of sales among 
chain and other grocery retailers has traditionally been relatively 
low, but has been increasing in the past few years. In 1997, over two 
hundred grocery store chains operated in the United States, along with 
several thousand independent grocers. The four largest chains, 
accounted for approximately 23 percent of all supermarket sales. At the 
local level, where competition for consumer dollars occurs, 
concentration of sales is generally considerably higher, but varies 
across local areas and has not increased significantly since 1990. The 
four largest supermarket operators accounted for 96 percent of sales in 
Miami but only 52 percent in New York, with other metropolitan areas 
falling between the two.
    Consolidation can make firms in the supermarket industry more 
efficient and benefit both farmers and consumers. For example, larger 
firms may contract directly with farmers for fruits and vegetables. 
Improved efficiency and eliminating intermediaries can mean higher 
prices for producers and lower retail prices for consumers. Farmers 
have historically marketed very little of their production directly to 
retailers. Thus, the competition between retailers for farm level 
products has not been an important factor affecting farm prices. More 
critical to farm prices is the overall demand for agricultural goods 
and the competition among traditional first buyers of farm goods like 
grain elevators and meat packers.
    Consolidation may be creating a food system that is slower to 
respond to market forces. Lower farm prices may not be passed through 
to consumers as quickly when supermarket chains are fewer and larger 
and face fewer competitors. When this happens, farm prices may stay low 
longer because retail price cuts are not being used to work off the 
supply-demand imbalance that caused farm prices to fall.
            natural resources conservation service staffing
    Question. In the fiscal year 2000 President's budget request for 
the Natural Resources Conservation Service (NRCS) a staff level of 
1,055 is decreased from the fiscal year 1999 level. Why is the number 
of staff being decreased when the proposal of several new 
Administrative initiatives are in the fiscal year 2000 budget request 
in the conservation area?
    Answer. The NRCS budget increases are primarily for grants, 
easements, and other financial assistance directly for producers. 
However, the technical assistance required to support these initiatives 
and the acreage reduction from fiscal year 1999 for the Conservation 
Reserve Program result in 1,055 fewer staff years. Most of the 
reductions will take place in the field because past reorganizations 
have drastically reduced staff above the field level. This will result 
in a substantial reduction in the level of service provided to 
landowners and landusers in such areas as planning assistance, 
implementation of conservation practices, construction projects, 
resource inventories and reduced levels of implementation for some cost 
share programs.
    Question. Is the agency's funding strained under the current 
workload and staff level? Why?
    Answer. The fiscal year 2000 budget does not provide full funding 
for all the technical assistance needed to implement the proposed 
program activities, but all the staff years are counted as being funded 
in the 11,194 FTE ceiling shown in the budget. The fiscal year 2000 
does not request any additional for the emergency watershed protection 
program. There is a $25,300,000 short fall to pay for the technical 
assistance necessary to implement Wetlands Reserve, Farmland 
Protection, and Conservation Reserve programs. The short fall exists 
because the cost to service these programs exceeds the CCC Section 11 
cap on technical assistance.
               community/federal information partnerships
    Question. The fiscal year 2000 budget request proposes an increase 
of $5,000,000 and 20 full-time employees (FTE) for the Community/
Federal Information Partnerships (CFIP). $1,500,000 would be used to 
hire 10 additional FTEs. From where will the other 10 FTEs come and 
what work are they currently doing?
    Answer. The explanatory notes mistakenly identified 20 FTEs for the 
Community/Federal Information Partnerships. This initiative would only 
require the addition of 10 FTEs.
                              air quality
    Question. In the fiscal year 2000 budget request and agency 
programming, how does NRCS plan to work with American farmers who face 
air quality compliance problems?
    Answer. Both the Environmental Quality Incentive Program (EQIP) and 
the Conservation Reserve Program (CRP) help American farmers who face 
air quality problems. EQIP enables NRCS to direct financial assistance 
to farmers with air quality problems. For example, in California there 
are four serious PM-10 non-attainment areas. In fiscal year 1998, NRCS' 
California State Office addressed air quality problems in the following 
ways: $15,000 for education grants to local Resource Conservation 
Districts and Air Quality Management Districts that helped publicize 
methods for controlling on-farm road dust; $300,000 for statewide 
concerns cost-shared at 75 percent with farmers for dust suppression on 
farm roads and chipping almond residues as an alternative to burning; 
and, within geographic priority areas, local work groups supported cost 
sharing on air quality mitigation practices. Similar levels of spending 
are planned for fiscal year 1999. The CRP has also mitigated air 
quality problems on thousands of acres across the nation (e.g., 
Washington).
    Question. What funding is requested for this purpose, if any, and 
what amount of funding is needed to get the job done?
    Answer. NRCS is not requesting specific funds for technical 
assistance in the current budget cycle to address air quality 
compliance. However, in response to the question regarding the funding 
needed to get the job done, NRCS estimates that about
    $25,000,000 will be needed to begin addressing compliance issues 
through the Conservation Operations Program. These funds would be used 
to train existing field staff and to employ new staff to increase 
specialized technical assistance available to agency customers in 
defined air quality non-attainment areas.
    Question. How is the agency working in cooperation with both the 
Environmental Protection Agency and USDA's Air Quality Task Force in 
representing the needs and interests of the American farmer on air 
quality issues?
    Answer. Pearlie Reed, Chief, NRCS, chairs the Agricultural Air 
Quality Task Force (AAQTF). The AAQTF is comprised of representatives 
of agricultural production, agricultural industry, science, and health, 
including a representative of EPA's Office of Air Quality Planning and 
Standards. AAQTF recommendations regarding oversight, coordination, and 
science of agricultural air quality are transmitted to the Secretary of 
Agriculture and the Administrator of EPA. To date, the AAQTF developed 
a Memorandum of Understanding, signed by Secretary Glickman and 
Administrator Browner (NRCS A-3A75-8-30), to facilitate cooperation on 
agricultural air quality between USDA and EPA and has recommended 
priorities for air quality research. NRCS has also located a liaison 
with EPA's Office of Air Quality Planning and Standards in North 
Carolina. USDA staff from NRCS, FS, ARS, and CSREES and EPA staff from 
the Office and Air Quality Planning and Standards and the Office of 
Research and Development are meeting regularly on agricultural air 
quality issues.
                 grazing lands conservation initiative
    Question. In fiscal year 1997, fiscal year 1998, and fiscal year 
1999 $15,000,000 was earmarked for the continuation of the grazing 
lands conservation initiative. Please update the Committee on this 
initiative and include any money in the fiscal year 2000 President's 
budget request for this project.
    Answer. NRCS continues to work successfully with the National GLCI 
Steering Committee and other partners to develop and coordinate NRCS' 
commitment to meeting the needs of local farmers and ranchers 
responsible for management of the nations grazing lands. The fiscal 
year 2000 President' budget does not specify additional appropriations 
to implement this initiative. NRCS continues to expand on past 
accomplishment which includes the availability of grazing land 
specialists in all states. The following is a report of NRCS fiscal 
year 1998 accomplishments due to increased emphasis and demand for 
technical assistance for the Nation's grazing lands. Fiscal year 1999 
activities are ongoing and are not available at this time
                            accomplishments
Staffing
    In 1998 hired 45 new employees and 421 employees allocated the 
majority of their time to providing technical assistance on GLCI 
activities.
Training
    Over 16,000 individuals, including NRCS employees, and personnel 
from other agencies, and private grazing landowners and managers 
received training.
Technical Assistance
    Technical assistance was provided on over 14,000,000 acres of 
grazing land. The conservation practice Prescribed Grazing was applied 
to over 11,500,000 acres.
Grazing Land Projects
    There are 324 grazing land projects nationwide that demonstrates 
grazing land management and technologies.
Public Education and Awareness
    NRCS conducted over 1,000 public awareness and education and 
awareness activities to over 202,000 individuals.
                    demonstration projects language
    Question. The appropriation language proposed in the fiscal year 
2000 budget request deletes the prohibition on demonstration projects. 
This deletion will provide NRCS the ability to have demonstration 
project to educate and share conservation techniques with small farmers 
and financially limited landowners. Please explain the need for this 
change in law.
    Answer. This change is proposed to allow NRCS the flexibility 
needed to efficiently and effectively implement its Civil Rights 
Outreach program. Demonstration projects are often the most effective 
way to work with groups of underserved farmer and ranchers. However, 
the current language in the Conservation Operations appropriation 
account prevents us from conducting demonstration projects, and our 
lawyers tell us authorities granted under other NRCS programs are 
inadequate to carry out this type of demonstration project.
                        clean water action plan
    Question. As a part of the President's Clean Water Action Plan, all 
States have prioritized their watersheds according to the need for 
water quality and natural resource restoration or protection. This 
process is known as the Unified Watershed Assessment. Of the requested 
increase of $31,000,000 for conservation technical assistance (CTA), 
how much is allocated for the Clean Water Action Plan?
    Answer. All of the requested increase in CTA funding is for 
implementation of Clean Water Action Plan initiatives (Animal Feeding 
Operation strategy--$8,000,000; locally-led conservation--$20,000,000; 
and watershed health monitoring--$3,000,000).
                      unified watershed assessment
    Question. How much is being spent on the Unified Watershed 
Assessment process currently and how much is allocated for fiscal year 
2000?
    Answer. For fiscal year 1999, there was no funding specifically 
allocated to NRCS for the Unified Watershed Assessment (UWA) process. 
NRCS support for the UWAs in fiscal year 1999 came as a part of ongoing 
program efforts. The fiscal year 2000 budget request proposes a 
$3,000,000 increase for additional environmental monitoring and 
research work, a portion of which will provide data and information 
needed to establish base information and evaluate program outcomes for 
Federal resources used in UWA priority areas.
                animal feeding operations draft strategy
    Question. Another component of this Clean Water Action Plan is the 
Animal Feeding Operations (AFO) draft strategy. The fiscal year 2000 
budget request proposes an increase of $8,000,000 and 97 staff years to 
support this initiative. The Environmental Protection Agency estimates 
that there are 450,000 animal feeding operations and 6,600 concentrated 
animal feeding operations in this country. It believes that a large 
number of these will need to develop or revise their waste management 
plans. How much is currently being spent on this initiative and how 
many staff years are working on it?
    Answer. NRCS will spend $53,500,000 ($37,000,000 Conservation 
Technical Assistance and $16,500,000 EQIP) in fiscal year 1999 to 
provide technical assistance through the locally-led planning and 
implementation process to help AFO owners and operators address water 
quality issues related to animal agriculture. The small watershed 
progra contributes technical assistance dollars also, however, data is 
not available to identify specific contributions. Starting with this 
year, NRCS is tracking through its accountability system how its staff 
time is used to address the needs of AFO owners and operators, by 
specific program and activity, for all employees.
    Question. What kind of demand from farmers is there for this 
technical support through Conservation Operations since no cost-share 
assistance will be provided.
    Answer. NRCS currently assists approximately 10,000 AFOs annually 
through a variety of programs (i.e., Conservation Operations, EQIP, and 
the small watersheds program) to prepare animal waste management plans, 
provide technical engineering and agronomic expertise, design and build 
structures, and implement land management practices. Regularly these 
farmers seek our technical assistance before they determine whether or 
not to apply for financial assistance from a variety of potential cost-
share sources, including USDA and state and local agencies. Thus, 
initially they will receive planning assistance, for example, through 
the Conservation Operations program, but they may ultimately receive 
implementation assistance through a different or non-USDA financial 
assistance program. Our accountability system is not currently 
capturing the data we need to provide specific demand numbers; however, 
we anticipate that the pending issuance of the Unified National 
Strategy for AFOs will significantly increase the demand by AFO owners 
and operators for technical assistance.
    Question. How does this demand compare to the demand for technical 
and cost-share assistance provided through the Environmental Quality 
Incentives Program (EQIP)? Is not this work not addressed through EQIP? 
Please explain.
    Answer. The primary source of USDA financial assistance to AFO 
owners and operators is the Environmental Quality Incentive Program 
(EQIP), which has been funded at $200,000,000 in 1997 and 1998 and 
$174,000,000 in 1999. Approximately 45 percent of the funds in each of 
these years fund contracts with AFOs to develop and provide cost share 
incentives to help implement nutrient management plans. The requests 
for financial assistance funds for AFOs during each of those years was 
approximately three times the amount available. It is likely that the 
Unified AFO Strategy, as well as the increased attention to this issue 
by states, will further increase the demand for both technical and 
financial assistance from USDA. It should also be noted that EQIP is 
specifically designed to encourage the leveraging of other sources of 
technical, educational and financial assistance funds.
    Question. The fiscal year 2000 Budget Justification Notes state 
that the $8,000,000 for AFO will be combined with approximately 
$1,000,000 in climate-related AFO pilot projects and $11,000,000 in 
redirected conservation technical assistance funds. This will bring the 
total to $20,000,000 for the AFO conservation technical assistance. 
What sort of climate change-related AFO pilot projects are planned? 
From what area of conservation technical assistance will the 
$11,000,000 be redirected?
    Answer. The AFO pilot projects will demonstrate and test various 
greenhouse gas mitigation strategies and monitoring mechanisms, as well 
as a variety of financial assistance mechanisms under existing 
authorities. Examples of potential pilot projects include compost-based 
waste handling facilities, constructed Wetlands for waste management, 
rotational grazing systems, and improved feed/forage efficiency.
    Conservation technical assistance funds are to be used to maintain 
and improve the soil, water, and related resources of the Nation's 
nonpublic lands by reducing excessive soil erosion; reducing 
agricultural nonpoint source pollution of water; improving irrigation 
efficiency; making more effective use of water; reducing upstream flood 
damages; improving range condition; and restoring, maintaining, and 
improving wetlands. Thus, the allocation of the $11,000,000 will be 
made with the requirement that the funds be used to address the needs 
of AFOs.
    Question. The fiscal year 2000 budget request proposes an increase 
of $15,000,000 for activities supporting the Global Climate Change. 
What is currently being spent on these activities?
    Answer. NRCS has funded its Global Climate Change research program 
at $1,200,000 in fiscal year 1998 and fiscal year 1999. Prior years 
were funded at $1,500,000. Funds were distributed and utilized as 
follows:
  --50 percent to the National Soil Survey Center, Lincoln Nebraska 
        ($600,000). Conservation and Wetlands Reserve Programs carbon 
        sequestration effects, conducted jointly with ARS and 
        University Cooperators, changes in soil climate (moisture and 
        temperature) and associated rates of carbon sequestration, Soil 
        Carbon map production, National soil carbon stock analysis
  --40 percent to NRCS state offices for University cooperator research 
        projects ($442,000). Most funds directed toward a long term 8-
        state (TX, LA, OR, IN, ND,MN,NH,UT) comprehensive wetlands 
        study which includes rates of change in carbon stocks.
  --10 percent to universities in response to RFP's on climate change 
        and carbon sequestration ($162,000).
                          soil carbon studies
    Question. Which agency conducted the soil carbon studies? What is 
NRCS' role in expanding this study?
    Answer. Several agencies within USDA, including the ARS and the FS, 
are conducting soil carbon studies. NRCS is engaged in a multi-year 
effort related to Global Change. As a result, seven technical volumes 
have been published on soils and global change and five more are 
currently in process. Most of these publications were proceedings from 
scientific meetings organized jointly by the Natural Resources 
Conservation Service, the Agricultural Research Service, the Forest 
Service, the Environmental Protection Agency, the National Aeronautics 
and Space Administration and the Ohio State University. Titles include: 
Management of Carbon Sequestration in Soil, Soil Management and the 
Greenhouse Effect, and Soil Processes and the Carbon Cycle. One volume 
was a special synthesis report on The Potential for U.S. Cropland to 
Sequester Carbon and Mitigate the Greenhouse Effect. Similar reports on 
the potential for U.S. grazing lands and U.S. forestlands are currently 
in production.
    The carbon cycle research projects undertaken by the NRCS are 
directed at terrestrial soil carbon interactions with atmospheric 
biochemical fluxes. This knowledge will enable circulation models to 
more accurately describe, at the regional scale, the impacts of 
agriculture and forestry on greenhouse gas levels, and to project 
adaptation capacity.
    The NRCS cooperative soil survey data is the first building block 
essential to understanding the terrestrial carbon pool. To establish 
the scientific basis for a terrestrial carbon inventory, refinement of 
soil carbon data across soils, climate regimes, and under various 
management systems and land uses is required. The fiscal year 2000 
Global Change budget initiative in NRCS begins to address this 
requirement. Specific components include the following:
    NRCS will enhance the national soils data bases through five 
initiatives: Accelerate digitizing of county level soil surveys, and 
update the state level soil mapdatabase, which are the primary 
geospatial data layers linked to the national soils attribute database, 
Complete the National Soil Information System (NASIS) development 
effort to achieve on-line database access, Add ``use-dependent'' soil 
carbon data and soil pedon descriptions to the NASIS database, Develop 
on-line, a real-time georeferenced soil pedon database Develop the 
Ecological Site Information System (ESIS: a cooperative FS/BLM/NRCS 
effort) for range and forestland.
    Evaluations, including field validation and calibration, of 
modeling, remote sensing, and statistical inventory approaches to field 
level, regional and national scale carbon stock assessments that are 
sensitive to the land management practices and agronomic systems that 
impact soil carbon levels.
  --Directed field soil sampling and increased laboratory analysis 
        capacity
  --Development, testing and application of improved sampling, 
        inventory and analysis protocols
    This enhanced NASIS database, and associated databases, models, 
inventory and assessment products will be applicable to integrated 
environmental and agricultural sector policy impact analysis, as well 
as providing scientifically grounded tools for potential carbon 
crediting or trading programs. It will enable carbon cycle, land use, 
and socio-economic models and inventories to utilize soil carbon data 
that reflect actual biophysical and human induced variability in soil 
carbon stocks.
    Focus of the first year's effort in these carbon studies (Global 
Change Research Program, $12,000,000) will be in major agricultural 
regions on major crops in common production systems, and expanding into 
about 25 percent of non-federal range and forest lands.
    The initiative also has a component (Climate Change Technology 
Initiative, $3,000,000) that includes pilot projects for delivery of 
carbon enhancing/emission reducing conservation systems.
    Incentives, planning tools, and technical assistance for 
conservation systems that comprehensively enhance soil carbon 
sequestration and reduce greenhouse gas emissions, while also achieving 
water quality, wildlife and other environmental benefits will be field 
tested and evaluated.
    Pilots will be conducted on croplands, grazing lands, and animal 
feeding operations, using existing financial and technical assistance 
programs. Innovative management systems and field carbon prediction and 
planning tools being developed by ARS will be field applied and 
evaluated.
    Example of systems and practices that build soil organic carbon, 
and reduce greenhouse emissions that will be piloted may include: 
Cropland, use of cover crops, field application of organic amendments, 
reduced tillage and residue management systems,nutrient management, 
establishment of landscape buffers; Animal production and grazing land 
establishment of grass based animal feeding systems, establishment of 
aerobic compostig operations alternative management systems for 
confined animal manure handling.
    Attention will be paid to technology and delivery systems 
appropriate for limited resource, small scale, and underserved clients.
          measurements of sequestration of soil organic carbon
    Question. Once the measurement and incentive systems are developed 
and applied, sequestration of soil organic carbon will be measured and 
verified. Which agency will carry out the measurements of sequestration 
of soil organic carbon?
    Answer. NRCS does not anticipate conducting extensive measurement 
of carbon sequestration. NRCS is cooperating with ARS and others to 
direct selected field carbon measurements to develop, validate and 
verify models that could be used at various scales to predict carbon 
sequestration. Models that are being developed to predict soil carbon 
sequestration are compatible with existing programs in use in the NRCS 
field offices to plan and predict the erosion control benefits of 
conservation systems. The intent is to create a seamless system, into 
which data need be entered only one time to predict erosion rates and 
carbon sequestration rates for farming system options selected by 
farmers. The information infrastructure is being designed to be 
available on the Internet, so that farmers or private sector 
consultants may utilize the available information and analytic tools 
independent of federal conservation programs. These tools may also be 
applied by NRCS in national and regional carbon stock inventories in 
addition to other natural resource condition assessments, such as 
erosion in the National Resources Inventory. Field measurement 
validation of models will be conducted by NRCS in cooperation with the 
Agricultural Research Service. Field level measurement for verification 
may be conducted by NRCS or others as appropriate, based on the type of 
program or private contractual agreement in place for carbon storage.
                         global climate change
    Question. Will any of this work address the study by the Pew Center 
on Global Climate Change that indicates global warming will change 
where crops are currently grown in the U.S.? (The study indicates crop 
acreage and livestock operation will shift northward.)
    Answer. The NRCS budget request includes $200,000 which will be 
contributed to the Agricultural Sector and regional global climate 
change assessment reports that are being coordinated through the USDA 
Global Change Program Office and the USGCRP.
         tracking grazing conservation assistance program funds
    Question. In the fiscal year 1999 Senate Report, the Committee 
directed the agency to establish a system to provide an accounting of 
funds used for the grazing conservation assistance program within 
conservation operations. What has the agency done to address this 
directive?
    Answer: NRCS has established an accountability system that meets 
the directive. The National Performance and Results Measurement System 
(PRMS) captures data from all levels of NRCS. It provides easy and 
timely access to agency accomplishments. Time and Cost Accounting 
System (TCAS) is part of the accountability system to collect 
information on how employees spend their time. Specific to the GLCI 
earmark, PRMS and TCAS collectively will allow the agency to monitor 
and report progress in staffing, training, technical assistance, 
projects and outreach activities. Additionally the NRCS has also 
implemented a workload analysis system to address future GLCI workload 
requirements.
                    plant materials centers funding
    Question. Please explain how the $1,000,000 for the plant materials 
centers in the fiscal year 1999 Senate Report has been used to continue 
development of warm season grasses for use in the Conservation Reserve 
Program and the Wildlife Habitat Incentives Program. How has the agency 
encouraged the development and transfer of technology among all the 
Department's natural resources conservation programs?
    Answer. The $1,000,000 was distributed among plant centers doing 
work with warm season grasses. Some of the species under study include: 
eastern gama grass, bluestems, switch-grass, dropseed, gramas, and 
Indiangrass. All of these species are natives that provide critical 
food and/or habitat (e.g., cover) for wildlife. Consequently, they 
represent a core group of plants that are available for use in the 
Wildlife Habitat Incentives Program. Many of the same species are also 
important components of the Conservation Reserve Program (CRP). In the 
Great Plains, for example, bluestems, Indian grass, and switch-grass 
are widely used to restore and stabilize highly erodible lands. In 
recent years, the Plant Materials Program has developed and released 
cultivars that are now in high demand for the CRP. Without these 
releases, it is doubtful that the CRP would be very functional.
    Despite past success, however, there is an ongoing need to develop 
better materials and technical information on warm season grasses. The 
$1,000,000 has enabled this work to continue actively at 16 Plant 
Materials Centers. Centers that are involved include ones in Arizona, 
Arkansas, Florida, Georgia, Kansas, Louisiana, Mississippi, Missouri, 
Montana, New Mexico, New York, North Dakota, Texas (3 centers), and 
Washington. These centers have studies underway with warm season 
grasses to develop better selections and more advanced technology.
    Technology development and transfer in the Plant Materials Program 
has advanced along a broad front. Cooperative work is underway with the 
National Park Service, Department of Defense, Department of 
Transportation, and Agricultural Research Service. The Plant Materials 
Program serves as a source of technology for application-oriented 
information. The Natural Resources Conservation Service encourages work 
of this sort. It is promoted as one way to avoid duplicative efforts 
among other natural resources conservation programs. Technology 
transfer is achieved through printed materials, oral presentations, and 
electronic transfer. Last year, for example, the Plant Materials 
Program had 310 written materials and 469 oral presentations. Written 
materials included technical notes, plant guides and fact sheets, 
symposium/poster materials, and progress reports. Oral presentations 
included training sessions, tours, and local/regional/national 
presentations. Electronic transfer was also accomplished via an 
Internet homepage. The address is: http://plant-
materials.nrcs.usda.gov.
                priority area pilot projects under eqip
    Question. Please explain the progress that the NRCS has made in 
addressing the Committee's directive in the fiscal year 1999 Senate 
Report regarding the priority area pilot programs under the guise of 
EQIP.
    Answer. The fiscal year 1999 Senate Appropriations Report, the 
Committee ``directs the agency to evaluate the applications for fiscal 
year 1999 and proceed to provide adequate funding for not less than two 
national priority area pilot projects.'' NRCS is in the process of 
establishing the two national priority areas called for in the Senate 
Report.
    In the interim, to meet the Committee's direction, $5,650,000 was 
allocated in fiscal year 1999 to increase funding to two priority areas 
previously identified and approved by NRCS State Conservationist, and 
recognized by NRCS as having national significance. Of this amount, 
$1,300,000 was allocated to Mississippi for the Mississippi Delta 
region. The funds will be expended in several smaller priority areas 
approved in this region. The second area of national significance is 
the Colorado River Salinity Control effort. Colorado, Utah, and Wyoming 
were allocated a total of $4,350,000 for use in priority areas where 
salt reduction is occurring in cooperative efforts with other local, 
State, and Federal agencies and groups.
                   wetlands reserve program easements
    Question. How has the agency addressed the acceptance of WRP bids 
and the goal that landowners be offered a choice among permanent and 
nonpermanent easements as well as cost-share agreements?
    Answer. Landowners are offered the opportunity to sign up for one 
or more of the categories of WRP projects. The offers for each category 
are ranked with others of the same category and funds are allocated to 
fund the best offers from each of the three types. The amount of 
enrollment from each category is proportional to the level of landowner 
interest.
                 cooperative agreements supporting wrp
    Question. Please describe the existing cooperative agreements with 
private conservation organizations to support the implementation of the 
WRP.
    Answer. Cooperative agreements are in effect with a number of 
private conservation entities. They include the California Waterfowl 
Association, Ducks Unlimited, Great Swamp Conservancy (New York), Iowa 
Natural Heritage Foundation, Mississippi Fish and Wildlife Foundation, 
National Fish and Wildlife Foundation, Pheasants Forever, and the 
Wisconsin Waterfowl Association. The type of services included in the 
various agreements include: site evaluation and planning assistance to 
landowners; engineering field topographic surveys and structure design; 
on-site restoration implementation assistance; nest structure 
conservation and placement; funding assistance to primarily limited 
resource landowners; and administrative assistance with realty title 
clearance and land survey issues. In the Lower Mississippi River Valley 
States of Arkansas, Louisiana, and Mississippi, the assistance is in 
the form of engineering field topographic surveys and structure design, 
on-site restoration implementation assistance, nest structure 
construction and placement and cost-share assistance to limited 
resource landowners.
       transfer of watershed accounts to conservation operations
    Question. What is the purpose of the new appropriations language 
proposed in the Administration's fiscal year 2000 budget request that 
transfers funding for Watershed Surveys and Planning to Conservation 
Operations?
    Answer. Appropriating the funds to the water resources planning and 
construction accounts shows the total program costs of planning, 
technical assistance and construction during the fiscal year. 
Transferring these planning and technical assistance funds to the 
Conservation Operations account shows the costs for most of NRCS field 
activities in one appropriation account.
    Question. What is the purpose of the new appropriations language 
proposed in the Administration's fiscal year 2000 budget request that 
transfers funding for technical assistance for Watershed and Flood 
Prevention Operation to Conservation Operations?
    Answer. Appropriating the funds to the water resources planning and 
construction accounts shows the total program costs of planning, 
technical assistance and construction during the fiscal year. 
Transferring these planning and technical assistance funds to the 
Conservation Operations account shows the costs for most of NRCS field 
activities in one appropriation account.
                    flood prevention program funding
    Question. The decrease of approximately $16,000,000 in the proposed 
fiscal year 2000 budget request for Watershed and Flood Prevention 
Operations is based on the possibility that no Public Law 534 projects 
will score high enough for environmental and economic benefits to be 
funded. Is this correct? What will this money be used for instead?
    Answer. The decrease in the Watershed and Flood Prevention 
Operations of $16,000,000 is not directly related to the fact that in 
recent years, $15,000,000 of the total appropriation for watershed 
operations has been designated for Public Law 534. It has been NRCS' 
position that since all projects are funded by the same appropriations, 
both Public Law 534 and Public Law 566 projects should stand on their 
own merits in terms of economic and environmental defensibility. For 
this reason all projects in contention for funding are evaluated using 
the same criteria. To this point, Public Law 534 projects have competed 
well with those being considered.
    If no Public Law 534 projects were found to be economically and 
environmentally defensible in the near term then all available funds 
would be used to fund Public Law 566 projects.
               public law 534 watershed projects criteria
    Question. For Public Law 534 watershed projects, there are 23 
unserviced applications and 24 projects in the planning process. Will 
these be assessed under this new criteria of environmental and economic 
benefits in order to be addressed? When does the agency plan to move 
forward on the unserviced applications and the others in the planning 
process?
    Answer. The environmental and economic defensibility is considered 
for each project in contention for funding. In many ways these 
challenges are addressed in the planning process as a means of ensuring 
an appropriate investment of both federal and local dollars. The 
program statutes require that all projects must be economically 
defensible. It is doubtful that all necessary permits could be obtained 
unless it can be clearly demonstrated that a given project is also 
environmentally defensible. However, decisions for funding are not 
based solely on any one criteria. Consideration is given to other 
factors including existing threats to life and property that would be 
addressed by the project, and the needs of economically depressed 
communities.
    As to when the NRCS will move forward with unfunded authorized 
Public Law 534 projects and unfinished watershed plans is dependent on 
three key variables: sponsor commitment; the amount of Public Law 534 
funding available to support the technical assistance necessary to 
complete the work; and, the amount of financial assistance available to 
complete the project.
    Local sponsors are required to make commitments regarding 
landrights, liability, and securing the non-federal funds required in 
cost share projects. Sponsors are also required to obtain all necessary 
permits prior to implementation of their projects. Many of the 
authorized projects on which there has been no activity, and those with 
incomplete watershed plans have been placed in a hold status at the 
request of local sponsors. They simply have not wanted to accept the 
risk and uncertainties associated with readying their projects for 
funding in light of the drastic decline in appropriations for watershed 
operations.
                         risk management agency
    Question. In the fiscal year 2000 President's budget request an 
increase of $715,000 is proposed for civil rights activities for the 
Risk Management Agency (RMA). What activities is the Risk Management 
Agency currently doing in the civil rights area?
    Answer. RMA has significantly increased outreach activities aimed 
at assuring that ALL farmers and ranchers can equally access all risk 
management tools and programs. We have designated a full time National 
Outreach Coordinator as well as regional coordinators in the Regional 
Service Offices to implement the National Outreach plan. To assure that 
we reach all small and limited resource and traditionally under served 
farmers and ranchers, we have entered into cooperative agreements with 
eleven (11) community based and other organizations, summarized below, 
to provide risk management education and technical program assistance. 
We are reviewing four outreach proposals for consideration in fiscal 
year 2000. The Office of Civil Rights and Community Outreach Staff 
recently mailed out approximately 400 letters to community groups and 
organizations requesting that they get the message out to their 
constituents on the Emergency Financial Assistance to Farmers announced 
by President Clinton.
    In addition, RMA is currently working on the following initiatives 
relating to civil rights:
    Data Collection.--RMA and the Office of General Counsel have 
developed data and reporting regulations and procedures for reinsured 
companies to begin collecting civil rights data in the fall of 1999. 
The data will be used to determine how effectively RMA programs are 
reaching underserved groups and identify areas where additional 
outreach is needed.
    Civil Rights Compliance Reviews.--RMA is currently developing 
procedures, based on guidelines furnished by the Department, for 
conducting on-site civil rights/EEO evaluations and training for 
reinsured companies. The first of these training sessions is scheduled 
to begin on July 1, 1999.
    Diversifying the Delivery System.--The Office of Civil Rights and 
Community Outreach is working with reinsured companies to recruit and 
hire minority Agents. We are providing the companies with a list of 
minority insurance agents who may be interested in selling crop 
insurance. We are also inviting the companies to recruit at National 
Conferences, e.g., Minorities in Agriculture and Natural Sciences 
(MANRRS) scheduled in April, and at the 1890 and 1994 Land Grant 
Colleges and Universities.
    Cooperative Agreements.--RMA has cooperative agreements with the 
following organizations:
  --Federation of Southern Cooperatives--Provides program technical 
        assistance and training to small and limited resource farmers 
        in 12 southern states, and is conducting a customer survey.
  --Toppenish High School--Promote and encourage community efforts and 
        government agency participation in developing the project to 
        utilize the high school to educate local farmers and deliver 
        outreach efforts. The Washington State FAC, including the 
        Spokane RMA Regional Service Office will work with the project 
        coordinator on this initiative.
  --Intertribal Agriculture Council--This agreement is funded by RMA 
        and other USDA agencies to support specific goals to inform 
        Indian producers and tribal governments of programs and program 
        technical assistance which may be available to them in the 
        conservation of their natural and agricultural resources.
  --Rural Coalition/Coalition Rural--The Coalition will sponsor an 
        annual conference which will include representatives from 
        approximately 90 community-based organizations (CBOs). These 
        representatives will be trained on several USDA programs. They 
        will provide USDA training to members of their respective CBOs 
        through workshops and one-on-one consultations.
  --Hmong American Community, Inc.--Provides risk management education, 
        program training and information to Hmong and other Southeast 
        Asin farmers in California.
  --Bringing Rural America Venture Opportunities--RMA is partnering 
        with Office of Small and Disadvantaged Business Utilization to 
        create technology-based jobs on Indian lands and surrounding 
        economically disadvantaged rural areas. Tribal entities (Indian 
        Nations) will establish small start-up technology companies. 
        Initial services provided will be software development for 
        USDA.
  --Lac du Flambeau (LDF) Band of the Lake Superior, Chippewa Indians, 
        Lac Du Flambeau, WI--The LDF tribe will initiate an 
        agricultural and resource management program to provide 
        disadvantaged farmers and ranchers on the LDF Indian 
        reservation with the technical assistance and infrastructure 
        necessary to assure success. The LDF Band will provide 
        assistance to the LDF Indian tribe by allowing them to begin 
        providing food, jobs and income for their tribal members.
  --University of California, Cooperative Extension--Will develop a 
        directory and guide of Agricultural programs and services for 
        small farmers in San Joaquin Valley.
  --National Black Farmers Association, Inc.--Will provide training and 
        technical assistance programs to disadvantaged farmers in 16 
        counties in Virginia.
  --First American Curriculum Development Project--RJS & Associates 
        will develop five major (both print and computer assisted 
        instructional) curriculum units tailored to meet the needs of 
        American Indian agribusinesses. RJS & Associates will work with 
        the twenty-nine tribally controlled land grant colleges in the 
        development of this curriculum. This project will also identify 
        and develop potential employees (American Indians) for RMA and 
        other USDA agencies to address under representation in the 
        workforce.
    Question. How much of your current resources are being spent on 
civil rights activities?
    Answer. There was no separate funding provided for Civil Rights 
activities in RMA's fiscal year 1999 appropriation, but the Civil 
Rights staff has estimated $207,000 is needed for ongoing activities.
    Question. How much will the survey which RMA plans to commission 
with North Carolina A&T State University cost? How was this 1890 Land 
Grant University chosen to do this survey?
    Answer. We are currently estimating $25,000 for the survey. We have 
not made a commitment to North Carolina A&T at this time--other 
universities are also being considered. North Carolina A&T is being 
considered because it has the capacity to conduct surveys and provide 
professional analysis.
                       risk management education
    Question. An increase of $3,000,000 for Risk Management Education 
activities is also proposed in the President's fiscal year 2000 budget 
request. What amount of resources and on which activities is the RMA 
currently spending on education?
    Answer. Since its beginning in fiscal year 1998, the Risk 
Management Education (RME) initiative has never received operating 
(A&O) funding. All expenditures for RME have come from the FCIC Fund. 
In the enacted 1998 Agricultural Research Title, Public Law 105-185, 
certain expenditures from the FCIC Fund (including those for RME) were 
capped at $3,500,000 per year as part of a measure to permanently fund 
the crop insurance program. For fiscal year 1999, $1,000,000 of the 
$3,500,000 FCIC cap has been allocated to RME activities.
    The fiscal year 1999 RME budget is as follows:
        Item                                                      Amount

    Direct Producer and Trainer Education (local workshops)...  $550,000
    Cooperative State Research, Education, and Extension 
      Service (continued development of the Internet Library).   100,000
    Publications..............................................   250,000
    FFA Essay Contest.........................................    50,000
    Curriculum Development....................................    50,000
                    --------------------------------------------------------------
                    ____________________________________________________

          TOTAL............................................... 1,000,000
                            public outreach
    Question. How much is RMA currently spending on public outreach 
activities?
    Answer. We are spending an estimated $260,000, with an additional 
$330,000 possible for a nationwide mailing to approximately 1,000,000 
producers should the proposed reform measures be approved.
                      international crop insurance
    Question. Why is the RMA considering an expansion into an 
international crop insurance program and what purpose will this program 
serve?
    Answer. RMA's international work assignments are in response to 
requests made by various nations and emerging economies through USDA's 
Foreign Agricultural Service (FAS) foreign agricultural posts. 
Inquiries are handled on a case by case basis depending upon the 
individual request. Generally, initial briefings are handled by FAS 
Agricultural Attaches and other FAS personnel traveling overseas on 
other business. When there is a need for further technical assistance, 
RMA receives a request from FAS and a one or two hour meeting is held 
during which various RMA program staff are asked to brief the 
international representatives regarding: (1) How the U.S. crop 
insurance program is designed; (2) What benefits US producers receive; 
(3) The program's delivery mechanism, i.e., the Standard Re-insurance 
Agreement (SRA) which RMA uses to contract for delivery services with 
private sector insurance providers, and (4) Answers regarding any 
specific questions which are asked.
    Recent inquiries include: Japan has made two separate inquiries as 
to how the Dairy Options Pilot Program (DOPP) works; France requested 
information regarding revenue products, status of current legislative 
proposals, whether there is a possibility of new legislation which 
would restore price protection to US producers; Australia has inquired 
about potential legislative changes and inquired about Risk Management 
Education strategies; Rumania has requested USDA/RMA to provide 
training for four Rumanians on starting a crop insurance program 
utilizing a public-private partnership.
    Since the beginning of 1998, delegations from the following 
countries, international producers' groups, or international re-
insurers have made requests through FAS to the Risk Management Agency: 
Argentina, Austria, Australia, Brazil, Canadian Crop Insurance Research 
Directors, Czech Republic, European Corn Growers' Association, France, 
Germany Farmers' Union, Hungary, Israel, Italy, Japan, Mexico, New 
Zealand, Peru, Poland, Republic of South Africa, Rumania, Russia, 
Sweden, Taiwan, and the United Kingdom.
    Interest has also been expressed by the World Bank for RMA 
availability for representatives to speak at tentative upcoming 
seminars and/or participate in other local conferences.
    In addition, under the auspices of the U.S.-Republic of South 
Africa (RA) Bi-National Agreement (Bi-National) and in response to a 
specific request from the RA, the United States Agency for 
International Development (USAID) funded a grant to USDA/RMA which 
includes a section on creating crop insurance pilots for the RA. The 
general purpose of Bi-national is to foster stability for a new 
democracy with a newly enfranchised majority population and an emerging 
economy. Vice-President and Secretary Glickman participated in signing 
ceremonies for the Bi-National in South Africa in mid-February. With 
funding (approximately $300,000) from USAID, RMA will give assistance 
to RA so that crop insurance pilots and a subsequent education and 
training program can be created. Private insurance companies and their 
international re-insurers can be expected to participate in the 
project.
    Development of an international perspective for agricultural 
production insurance can assist local U.S. producers in two ways:
  --One: Level playing field issues for U.S. producers: WTO-GATT 
        agreements (within the framework of the Annex II negotiations) 
        call for the phase-out of direct subsidies to participating 
        nations' agricultural producers by the year 2020; and the FAIR 
        ACT of 1996 legislated the phase-out of U.S. producers' direct 
        subsidies (with AMTA payments slated to end in 2002). As AMTA 
        payments decline, U.S. farmers are being forced to compete in 
        foreign markets with international producers who still receive 
        large direct subsidies. RMA's assistance to foreign inquiries 
        has a long range goal of assisting other nations reduce their 
        producers' subsidies so that all farmers receive the same kinds 
        of assistance, i.e., sell/compete on a ``level playing field'' 
        under similar conditions.
 --Two: Spreading the risk so that the cost of insurance can be cheaper 
        for U.S. producers: Reinsurance companies, who are investing 
        and taking risk on one side of the world, are seeking ways in 
        which they can spread out or mitigate their own risk taking. 
        Having global access to successful farming endeavors on all 
        parts of the globe, rather than in just one hemisphere, can 
        help to mitigate the risks.
    Question. What is the estimated cost of this program.
    Answer. To date, RMA does not have a specific budget for 
international activities. Other than the USAID funds through the Bi-
National Agreement, RMA expenditures have, for the most part, been 
revenue neutral because of FAS' participation in the program and the 
ability of FAS and RMA to work together. Other RMA costs are minimal, 
e.g., limited to the sharing of materials which are already developed 
for U.S. farmers. If RMA were to take a more pro-active approach to the 
creation of an international crop insurance program, either additional 
Congressional funding or a Memorandum of Understanding would be 
necessary.
                         crop insurance reform
    Question. The current crop insurance program was intended to 
eliminate the need for ad hoc disaster assistance in appropriations 
bills. Why do you think your proposed reform package would eliminate 
the need for ad hoc disaster assistance?
    Answer. By addressing the concerns that farmers have raised 
regarding the program, we would increase participation and coverage 
nationally so that when natural disasters strike, farmers would have an 
adequate safety net to see them through the financial hardships. The 
Administration's proposal addresses the problems most often expressed 
by producers as to why the crop insurance program does not work for 
them. The plan would raise the current level of protection associated 
with catastrophic risk protection to some level that is more meaningful 
than the current 50/55 (yield/price) coverage available. At the same 
time the proposal would increase the current subsidy level for buy-up 
coverage. Producers often complain that subsidies above the 65/100 
coverage level are necessary to make effective coverage more 
affordable. The plan would also provide incentives for all coverage 
plans including the increasingly popular revenue plans. The 
Administration's proposal also seeks to address concerns raised by 
multi-year disasters and would authorize some form of umbrella coverage 
to assist farmers who have suffered repetitive crop losses due to 
natural disaster.
    The Administration's proposal would also seek authorization to 
offer limited coverage for livestock which is currently restricted by 
statute and would continue to emphasize the role of risk management 
education to ensure that farmers are aware of available options, 
including market mechanisms, to protect them from financial losses.
                            key initiatives
    Question. The President's fiscal year 2000 budget request proposes 
an increase of $7,000,000 to inform producers about risk management 
tools and alternatives. Also this increase would be used to expand 
research and create programs to cover more crops and expand the range 
of programs offered to existing crops. What is the agency currently 
spending on these program initiatives and how will the success of these 
initiatives be measured?
    Answer. In fiscal year 1999, it is estimated that $1,000,000 of the 
available $3,500,000 in the FCIC Fund will be used for Risk Management 
Education activities and programs. This is an important part of the 
crop insurance program in that it informs producers, through 
educational programs in local workshops, of risk management tools 
available to them, and also provides train-the-trainer sessions for 
educational partners, such as lenders and crop insurance agents. The 
remaining portion of the funds available, $2,500,000, will be used to 
maintain and improve current crop programs and to research new 
programs, to assure that farm producers have a cost-effective means of 
managing their risk through a strengthened safety net of risk 
management tools. A portion of this funding may also be used for the 
Public Outreach and Civil Rights activities. Civil Rights activities 
are estimated at $207,000, and Public Outreach activities are estimated 
at $590,000.
    RMA uses several methods of measuring the effectiveness of the RME 
initiative. First, evaluations are administered at all workshops and 
training sessions. These are used by local program planners to get 
feedback from producers as to which elements of training meet their 
needs so that future training sessions can be more effective. Second, a 
professional evaluator has been contracted through the Cooperative 
State Research, Education and Extension Service to examine larger 
projects funded through the RME initiative. Third, a survey project 
funded by RMA and conducted by four Land Grant universities will 
identify producers' risk management awareness and skill levels over 
several diverse agricultural areas and among small and limited resource 
farmers. Follow up surveys in the future will show the extent to which 
the RME initiative has been effective in raising producers' ability to 
manage risk.
    RMA will contract to assess the value of the Public Affairs support 
for the risk management education initiative. Key elements of the 
contract will include market research, to determine what producers know 
about the crop insurance program; the development of an outreach plan 
to inform producers of knowledge that was lacking; developing and 
producing materials and information to reach targeted audiences; and a 
final evaluation of the venture to see if the goals were met. The type 
of evaluation conducted will depend heavily on the funds made available 
for the effort.
    The success of the Civil Rights outreach initiatives will be 
measured through initial producer surveys, with a follow up survey with 
a year or two. Success will also be measured by the level of program 
participation of minority and small, limited resource producers, as 
well as the number of fee waivers granted to minorities and limited 
resource farmers in 1999 and 2000, as compared with 1998.
    RMA will measure the success of its research and development of new 
crop programs by evaluating premium income, insured acreage, 
participation, and actuarial soundness of pilot programs relative to 
performance goals established for the pilot at program inception. RMA 
will measure the success of its expansion of existing crop programs and 
overall program effectiveness by evaluating the degree to which U.S. 
agricultural production is covered by RMA insurance products. 
Currently, RMA covers an estimated 62 percent of U.S. agricultural 
production as allowed by the Act. As new crop programs and plans of 
insurance are made available, RMA will look to cover an increasing 
share of the total U.S. agricultural production. In addition, 
evaluations are made to assess producer acceptance, the ability of 
products to provide a viable economic benefit in times of yield or 
revenue loss, and whether product design adversely affects product 
delivery. These evaluations assist RMA in determining whether products 
should be eliminated, modified, or expanded.
                funding for crop insurance improvements
    Question. The Budget makes no recommendations for offsets to pay 
for any changes to crop insurance statutes. I understand that several 
billion dollars will be necessary. How does the Department propose to 
pay for these improvements?
    Answer. In its white paper, ``Strengthening the Farm Safety Net,'' 
the Administration states its intentions to seek consensus among 
producers, the Congress, and other stakeholders as to the nature of the 
changes needed. Once that consensus is built, agreement will be needed 
on the difficult task of finding the best way to finance those 
improvements. RMA is ready to work with Congress to develop a package, 
finalize the package, and work through everyone's ideas in a 
responsible manner regarding this issue.
             foreign market development cooperator program
    Question. In past years, this Administration has proposed that the 
Foreign Agricultural Service (FAS) directly fund certain costs 
supported by the Commodity Credit Corporation (CCC) and that 
appropriations for the Foreign Market Development Cooperator Program be 
reduced to offset these and other proposed increases in the FAS 
appropriation. Now, the President's fiscal year 2000 budget proposes 
that the Cooperator Program be funded by the CCC rather than the FAS 
appropriation. Why has the Administration reversed its position, both 
as to the program costs which should be borne by the CCC and the level 
of funding for the Cooperator Program?
    Answer. The budget proposes to continue funding for the Cooperator 
Program at $27,500,000, unchanged from estimated fiscal year 1999 
level. However, the proposal to shift Cooperator Program funding from 
the discretionary category to the mandatory category of the budget 
would free up an equal amount of discretionary spending for other 
worthy purposes. This proposal is consistent with provisions of the CCC 
Charter Act which authorize the use of CCC funds for export promotion 
and market development activities. Program funding for other market 
development activities carried out by FAS is already provided through 
CCC and this change would consolidate the source of funding and 
financial management activities for these various programs. By 
providing a permanent authorization for CCC funding, the proposal would 
provide stability for future program activities and would thereby 
enhance long-term planning by program participants.
    Question. The fiscal year 2000 request assumes savings in 
appropriations from proposed legislation to shift funding for the 
Foreign Market Development Cooperator Program from the direct 
appropriation of the Foreign Agricultural Service to the Commodity 
Credit Corporation. While the appropriations request for FAS is not 
reduced, the $27,500,000 in savings is nonetheless reflected in the 
total discretionary appropriations proposed by the President for this 
Subcommittee. If the legislative proposal to shift funding for the 
Foreign Market Development Cooperator Program to the CCC is not enacted 
by the Congress, what reductions in appropriations does the Department 
propose to offset the $27,500,000 in fiscal year 2000 appropriations 
required to continue funding for this program?
    Answer. The fiscal year 2000 budget was submitted on the basis of 
current law, which includes funding for the Cooperator Program in the 
FAS appropriation. Also included in the fiscal year 2000 budget is a 
legislative proposal to shift for the Cooperator Program to CCC. If 
this legislative proposal were adopted by Congress, the amount 
requested for FAS in fiscal year 2000 would be reduced accordingly.
    Question. Please provide a table showing the total amount of 
funding available for the Foreign Market Development Cooperator Program 
in fiscal years 1997 through 1999, and the amount proposed for fiscal 
year 2000, showing for each fiscal year the amount of federal funding, 
non-federal funds, and any federal carryover balance.
    Answer. I will be glad to provide that information for the record.
    [The information follows:]

                                           COOPERATOR PROGRAM FUNDING
                                            [Fiscal years 1997-2000]
----------------------------------------------------------------------------------------------------------------
                                                       1997            1998        1999 Estimate   2000 Estimate
----------------------------------------------------------------------------------------------------------------
FAS Funding.....................................         $27,500         $28,000         $27,500         $27,500
Non Federal Funds...............................          47,200          43,900          44,000          44,000
Federal Carryover Balance.......................          10,400          12,200           9,700           7,200
----------------------------------------------------------------------------------------------------------------

    Question. Provide a breakdown of how FMD Cooperator Funds were 
allocated in each of fiscal years 1998 and 1999.
    Answer. I will be glad to provide that information for the record.
    [The information follows:]

                       COOPERATOR FUND ALLOCATIONS
------------------------------------------------------------------------
                                               1998            1999
------------------------------------------------------------------------
American Forest & Paper Association.....      $1,613,300      $2,251,499
American Peanut Council, Inc............         522,978         420,168
American Seafood Institute..............         134,669          68,832
American Seed Trade Association.........         174,178         153,605
American Sheep Industry Association.....         108,635         132,935
American Soybean Association............       5,504,712       4,285,948
Cotton Council International............       2,297,114       1,092,657
Leather Industries of America...........         253,283         102,073
Mohair Council of America...............          10,853          26,143
National Cottonseed Products Association         153,551          58,497
National Dry Bean Council...............          49,759          65,754
National Hay Association................          52,682  ..............
National Renderers Association..........         615,878         870,130
National Sunflower Association..........         258,994         275,176
North American Millers' Association.....          19,140          33,529
Protein Grain Products International....          17,539  ..............
U.S. BeefBreeds' Council................          28,535          49,267
U.S. Dairy Export Council...............         239,242         436,390
U.S. Grains Council.....................       4,502,234       4,820,089
U. S. Hide, Skin & Leather Association..          84,159         102,973
U S. Livestock Genetics Exports, Inc....         657,891         585,987
U.S. Meat Export Federation.............       1,031,626    601,958 U.S.
Wheat Associates........................       6,904,601       5,067,903
USA Dry Pea and Lentil Council..........          73,492         106,529
USA Poultry & Egg Export Council........       1,121,758       1,262,484
USA Rice Federation.....................       1,558,393       1,118,970
Western Growers Association.............          10,804          10,504
Unallocated Funds.......................  ..............       3,500,000
                                         -------------------------------
    Cooperator Total....................      28,000,000      27,500,000
------------------------------------------------------------------------

                     reverse trade mission program
    Question. The fiscal year 2000 request proposes an increase of 
$250,000 to create a reverse Trade Mission Program. Please explain why 
this new program is needed to focus on the export potential of high-
value products and trade opportunities in the food service and hotel-
restaurant-institution section and why this cannot be done through 
existing market development, promotion and outreach activities.
    Answer. This proposal represents a low-cost/high-return investment 
activity that will expose foreign importers, retail-oriented business, 
and related trade officials to the diversity and quality of U.S. food 
products in addition to the superior U.S. food safety, production and 
marketing systems. This activity can be undertaken using existing 
market development authorities; however, there are no funds currently 
available that would allow this program to be implemented without 
necessitating a reduction in funding for other market development 
activities.
                  overseas currency fluctuations fund
    Question. For fiscal year 1999, the conference committee did not 
approve the Administration's request recommended in the Senate bill to 
establish a $2,000,000 revolving fund to enable the Foreign 
Agricultural Service to manage overseas currency fluctuations. The 
conference committee did not take a position on the merits of this 
proposal but pointed out the Administration had not yet developed a 
plan for this activity as requested in the fiscal year 1998 conference 
agreement. I do not find this plan in the President's budget, as the 
conferees expected. In fact, after two years of advocating a mechanism 
to allow the Foreign Agricultural Service to handle overseas currency 
fluctuations, I find no such proposal in the President's fiscal year 
2000 budget. Why?
    Answer. Section 705 of the General Provisions submitted with the 
Department's fiscal year 2000 budget estimates includes proposed 
language to allow ``up to $2,000,000 of the appropriation shall remain 
available until expended solely for the purpose of offsetting 
fluctuations in international currency exchange rates, subject to 
documentation by the Foreign Agricultural Service''. This language will 
allow the establishment of an overseas buying power maintenance account 
to assist FAS manage unanticipated changes in the costs of overseas 
operations associated with exchange rate losses or gains and overseas 
inflation. This proposal is budget neutral and responds to conference 
report language which directs the Department to develop a plan for 
establishing an account to manage overseas currency fluctuations.
                        export market expansion
    Question. Please describe how the Department has utilized existing 
authorities including, but not limited to, the Export Enhancement 
Program, the Food for Progress program, Public Law 480, and GSM credit 
programs to facilitate additional sales and donations to maintain and 
expand export markets.
    Answer. The Department has sought to maximize the use of its 
available tools to maintain and expand U. S. agricultural exports 
during this period of world financial turbulence. For example under the 
Section 416(b) program, the Department is responding to financial and 
other crises around the world by donating over 5,000,000 metric tons of 
wheat and wheat products (flour and bulgur). Also under the Section 
416(b) program, we are donating smaller quantities of corn and non-fat 
dry milk to needy countries. By comparison, the Section 416(b) program 
shipped almost no commodities in fiscal year 1998.
    We also continue to facilitate exports under the Dairy Export 
Incentive Program. From July through January, bonuses of nearly 
$80,000,000 were awarded for exports of nearly 70,000 metric tons of 
U.S. nonfat dry milk, over 3,000 tons of whole milk powder and 4,000 
tons of cheese.
    The Export Enhancement Program has been used sparingly in recent 
years due to world supply and demand conditions. However, last May, the 
EEP was reactivated to announce an allocation of frozen poultry to six 
Middle East countries and an EEP initiative for barley was announced to 
Algeria, Cyprus and Norway.
    Under the Food for Progress program, USDA programmed more 
commodities in fiscal year 1998 than it did in fiscal year 1997, 
getting very close to the 500,000 metric tons (MT) ceiling permitted 
under the program. USDA successfully programmed commodities to a wider 
range of countries and regions in fiscal year 1998. By region, 
commodities were programmed as follows: 50 percent to Eastern Europe 
and the Former Soviet Union, 30 percent to Africa, Asia and the Middle 
East, and 20 percent to Latin America. For fiscal year 1999, USDA 
expects to program close to that level again and has focused its 
efforts on programming a broader range of commodities, including 
planting seeds, canned salmon, green and yellow peas, and non-fat dry 
milk for Russia.
    Under the Public Law 480 Title I program in fiscal year 1998, USDA 
signed agreements with 25 countries providing approximately 1,300,000 
metric tons of commodities. For fiscal year 1999, USDA expects to 
maximize U.S. agricultural commodity shipments under Public Law 480 by 
focusing on non-wheat commodities, given the availability of the wheat 
under the President's Food Aid Initiative. For example, USDA expects to 
program 975,000 MT of commodities (excluding the special Russia 
program) in fiscal year 1999 including 20 percent as wheat. This 
compares to 1,300,000 metric tons of commodities programmed in fiscal 
year 1998 which included 77 percent of wheat. Shipments of feed grains, 
soybean meal, vegetable oil, and rice are expected to increase as a 
result.
    Under the GSM export credit guarantee programs, USDA expanded the 
scope of the program in fiscal year 1998 in response to the world 
financial crisis. Approximately $4.000,000,000 in sales were registered 
in fiscal year 1998, compared to $2,900,000,000 in fiscal year 1997. 
The projected sales registrations of $4,700,000,000 in fiscal year 1999 
are designed to support expansion and maintenance of U.S. agricultural 
exports.
    In response to the Russian financial crisis, the Department is 
making broad use of Public Law 480 title I, Section 416(b), and the 
Food for Progress programs to ship approximately 3,100,000 metric tons. 
This is into a market that purchased only very limited quantities of 
U.S. grains in recent years.
                         public law 480 program
    Question. The Public Law 480 title I Program not only provides food 
aid to targeted developing countries but is intended to promote future 
markets in these countries. At a time when market expansion is 
critical, why is the Administration proposing to reduce funding for the 
program?
    Answer. A higher program level for Public Law 480 assistance might 
have been preferred, but the targets for discretionary spending which 
were established to help balance the budget make it extremely difficult 
to allocate additional funds to the program. We will be able to 
supplement Public Law 480 food assistance in 2000 with commodities to 
be made available under the Food for Progress Program.
    Question. Please provide for the record the Public Law 480 funding 
allocations, by title, and by country and commodity, for each of fiscal 
years 1998 and 1999, to date.
    Answer. I will provide for the record the Public Law 480 funding 
allocations, by title, and by country and commodity, for each of fiscal 
years 1998 and 1999, to date.
    [The information follows:]

                            PUBLIC LAW 480 FUNDING ALLOCATIONS, COMMODITY BY COUNTRY
                                             [Commodity Value $000]
----------------------------------------------------------------------------------------------------------------
                                                                          Public Law 480           Commodity By
                       Commodity/Country                        --------------------------------- Country Totals
                                                                  Title I    Title II  Title III        \1\
----------------------------------------------------------------------------------------------------------------
 
                        Fiscal Year 1998
 
Beans:
    Albania....................................................  .........         39  .........              39
    Angola.....................................................  .........        660  .........             660
    Bosnia-Herzegovina.........................................  .........      1,525  .........           1,525
    Bulgaria...................................................  .........        657  .........             657
    Burkina Faso...............................................  .........      1,007  .........           1,007
    Burundi....................................................  .........        381  .........             381
    Cape Verde Islands.........................................  .........        758  .........             758
    Ghana......................................................  .........         55  .........              55
    Guatemala..................................................  .........        560  .........             560
    Haiti......................................................  .........        220  .........             220
    Honduras...................................................  .........        852  .........             852
    Kenya......................................................  .........      1,455  .........           1,455
    Liberia....................................................  .........      1,100  .........           1,100
    Mozambique.................................................  .........        495  .........             495
    Nicaragua..................................................  .........        165  .........             165
    Rwanda.....................................................  .........      2,323  .........           2,323
    Serbia.....................................................  .........        928  .........             928
    Unspecified................................................  .........      1,123  .........           1,123
                                                                ------------------------------------------------
      Sub-Total................................................  .........     14,302  .........          14,302
                                                                ================================================
 
Bulgur:
    Ethiopia...................................................  .........        543  .........             543
    India......................................................  .........      6,091  .........           6,091
    Liberia....................................................  .........      4,444  .........           4,444
    Peru.......................................................  .........      1,733  .........           1,733
    Sierra Leone...............................................  .........      5,564  .........           5,564
                                                                ------------------------------------------------
      Sub-Total................................................  .........     18,376  .........          18,376
                                                                ================================================
 
Corn:
    Angola.....................................................  .........      5,973  .........           5,973
    Cape Verde Islands.........................................  .........      1,266  .........           1,266
    El Salvador................................................  .........        262  .........             262
    Guatemala..................................................  .........         70  .........              70
    Guyana.....................................................         67  .........  .........              67
    Kenya......................................................  .........      3,639  .........           3,639
    Korea, North...............................................  .........     13,880  .........          13,880
    Rwanda.....................................................  .........        245  .........             245
    Somalia....................................................  .........        133  .........             133
    Sudan......................................................  .........      1,866  .........          1,866-
    Tanzania...................................................  .........      2,023  .........           2,023
    Uganda.....................................................  .........      4,018  .........           4,018
                                                                ------------------------------------------------
      Sub-Total................................................         67     33,375  .........          33,442
                                                                ================================================
 
Corn Soy Blend:
    Angola.....................................................  .........        314  .........             314
    Bolivia....................................................  .........        575  .........             575
    Burundi....................................................  .........      1,256  .........           1,256
    Cape Verde Islands.........................................  .........        251  .........             251
    Cameroon...................................................  .........        628  .........             628
    Cote d'Ivoire..............................................  .........        170  .........             170
    Ethiopia...................................................  .........        892  .........             892
    Gambia.....................................................  .........        487  .........             487
    Ghana......................................................  .........        100  .........             100
    Guatemala..................................................  .........      1,240  .........           1,240
    Haiti......................................................  .........         75  .........              75
    Honduras...................................................  .........        534  .........             534
    India......................................................  .........     45,609  .........          45,609
    Indonesia..................................................  .........        188  .........             188
    Kenya......................................................  .........        637  .........             637
    Korea, North...............................................  .........      9,420  .........           9,420
    Liberia....................................................  .........      1,413  .........           1,413
    Madagascar.................................................  .........      1,149  .........           1,149
    Nicaragua..................................................  .........        980  .........             980
    Peru.......................................................  .........      1,947  .........           1,947
    Rwanda.....................................................  .........         69  .........              69
    Sierra Leone...............................................  .........      1,143  .........           1,143
    Sudan......................................................  .........      2,000  .........           2,000
    Tanzania...................................................  .........      1,162  .........           1,162
    Uganda.....................................................  .........        710  .........             710
    Unspecified................................................  .........      1,884  .........           1,884
                                                                ------------------------------------------------
      Sub-Total................................................  .........     74,832  .........          74,832
                                                                ================================================
 
Cornmeal:
    Benin......................................................  .........        277  .........             277
    Bolivia....................................................  .........          5  .........               5
    Burundi....................................................  .........      1,174  .........           1,174
    Cote d'Ivoire..............................................  .........        182  .........             182
    Haiti......................................................  .........        241  .........             241
    Lesotho....................................................  .........        522  .........             522
    Mali.......................................................  .........        740  .........             740
    Rwanda.....................................................  .........      1,244  .........           1,244
    Sierra Leone...............................................  .........        431  .........             431
    Somalia....................................................  .........        822  .........             822
    Uganda.....................................................  .........      1,317  .........           1,317
                                                                ------------------------------------------------
      Sub-Total................................................  .........      6,953  .........           6,953
                                                                ================================================
 
Lentils:
    Angola.....................................................  .........        319  .........             319
    Bolivia....................................................  .........         86  .........              86
    Burundi....................................................  .........        265  .........             265
    Ethiopia...................................................  .........        283  .........             283
    Haiti......................................................  .........        405  .........             405
    Peru.......................................................  .........      1,113  .........           1,113
    Rwanda.....................................................  .........        430  .........             430
    Sierra Leone...............................................  .........      1,436  .........           1,436
    Sudan......................................................  .........      1,969  .........           1,969
    Unspecified................................................  .........        358  .........             358
                                                                ------------------------------------------------
      Sub-Total................................................  .........      6,662  .........           6,662
                                                                ================================================
 
Peas:
    Angola.....................................................  .........        547  .........             547
    Benin......................................................  .........        138  .........             138
    Bolivia....................................................  .........        415  .........             415
    Burkina Faso...............................................  .........        226  .........             226
    Burundi....................................................  .........        984  .........             984
    Ghana......................................................  .........         28  .........              28
    Haiti......................................................  .........      1,207  .........           1,207
    Kenya......................................................  .........        256  .........             256
    Liberia....................................................  .........      1,240  .........           1,240
    Mali.......................................................  .........        176  .........             176
    Mauritania.................................................  .........        124  .........             124
    Mozambique.................................................  .........        655  .........             655
    Peru.......................................................  .........      1,889  .........           1,889
    Rwanda.....................................................  .........      1,945  .........           1,945
    Sierra Leone...............................................  .........        647  .........             647
    Sudan......................................................  .........        963  .........             963
    Tanzania...................................................  .........        825  .........             825
    Uganda,....................................................  .........      1,595  .........           1,595
    Unspecified................................................  .........        552  .........             552
                                                                ------------------------------------------------
      Sub-Total................................................  .........     14,411  .........          14,411
                                                                ================================================
 
Rice:
    Angola.....................................................      1,699  .........  .........           1,699
    Benin......................................................  .........        509  .........             509
    Bulgaria...................................................  .........        176  .........             176
    Burkina Faso...............................................  .........      1,914  .........           1,914
    Cape Verde Islands.........................................  .........        348  .........             348
    Cote D'Ivoire..............................................  .........        293  .........             293
    El Salvador................................................  .........        831  .........             831
    Ethiopia...................................................  .........        139  .........             139
    Ghana......................................................  .........        864  .........             864
    Guatemala..................................................  .........      1,493  .........           1,493
    Haiti......................................................  .........        501  .........             501
    Honduras...................................................  .........        933  .........             933
    Indonesia..................................................     10,000     26,894  .........          36,893
    Jamaica....................................................      5,000  .........  .........           5,000
    Korea, North...............................................  .........      8,958  .........           8,958
    Madagascar.................................................  .........      1,515  .........           1,515
    Mauritania.................................................  .........        867  .........             867
    Nicaragua..................................................  .........      1,903  .........           1,903
    Peru.......................................................  .........      2,664  .........           2,664
    Serbia.....................................................  .........        260  .........             260
                                                                ------------------------------------------------
      Sub-Total................................................     16,699     51,063  .........          67,762
                                                                ================================================
 
Sorghum:
    Eritrea....................................................      2,000  .........  .........           2,000
    Ethiopia...................................................  .........      5,850  .........           5,850
    Kenya......................................................  .........        131  .........             131
    Niger......................................................  .........        262  .........             262
    Somalia....................................................  .........        983  .........             983
    Sudan......................................................  .........      6,285  .........           6,285
    Zambia.....................................................  .........        635  .........             635
                                                                ------------------------------------------------
      Sub-Total................................................      2,000     14,145  .........          16,145
                                                                ================================================
 
Soybean Meal:
    Guatemala..................................................  .........      3,136  .........           3,136
    Guyana.....................................................        700  .........  .........             700
    Nicaragua..................................................  .........        242  .........             242
    Philippines................................................     10,000  .........  .........          10,000
                                                                ------------------------------------------------
      Sub-Total................................................     10,700      3,378  .........          14,077
                                                                ================================================
 
Soybeans:
    Indonesia..................................................     12,000  .........  .........          12,000
    Kenya......................................................  .........        377  .........             377
    Kyrgyzstan.................................................      6,675  .........  .........           6,675
                                                                ------------------------------------------------
    Sub-Total..................................................     18,675        377  .........          19,051
 
    Bolivia....................................................  .........        773  .........             773
    Burkina Faso...............................................  .........      1,954  .........           1,954
    Ghana......................................................  .........        244  .........             244
    Guatemala..................................................  .........        336  .........             336
    Haiti......................................................  .........      4,279  .........           4,279
    Madagascar.................................................  .........         23  .........              23
    Peru.......................................................  .........        671  .........             671
                                                                ------------------------------------------------
    Sub-Total..................................................  .........      8,280  .........           8,280
                                                                ================================================
 
S.F. Cornmeal:
    Bolivia....................................................  .........         45  .........              45
    Burkina Faso...............................................  .........      1,638  .........           1,638
    Burundi....................................................  .........      2,051  .........           2,051
    Gambia.....................................................  .........        246  .........             246
    Korea, North...............................................  .........      6,550  .........           6,550
    Niger......................................................  .........        862  .........             862
    Rwanda.....................................................  .........      2,927  .........           2,927
                                                                ------------------------------------------------
      Sub-Total................................................  .........    14,3187  .........          14,318
                                                                ================================================
 
S. F. Sorghum Grits:
    Ghana......................................................  .........      1,053  .........           1,053
    Mauritania.................................................  .........        253  .........             253
    Niger......................................................  .........        462  .........             462
    Sudan......................................................  .........        359  .........             359
                                                                ------------------------------------------------
      Sub-Total................................................  .........      2,128  .........           2,128
                                                                ================================================
 
Tallow:
    El Salvador................................................      2,352  .........  .........           2,352
    Guatemala..................................................      2,879  .........  .........           2,879
    Nicaragua..................................................        750  .........  .........             750
                                                                ------------------------------------------------
      Sub-Total................................................  .........      5,981  .........           5,981
                                                                ================================================
 
Vegetable Oil:
    Albania....................................................      3,969         54  .........           4,023
    Angola.....................................................      2,653      2,267  .........           4,920
    Bangladesh.................................................  .........        433  .........             433
    Benin......................................................  .........        542  .........             542
    Bosnia-Herzegovina.........................................  .........      1,291  .........           1,291
    Bulgaria...................................................  .........        596  .........             596
    Burkina Faso...............................................  .........      1,643  .........           1,643
    Cape Verde Islands.........................................  .........        172  .........             172
    El Salvador................................................      2,361  .........  .........           2,361
    Eritrea....................................................  .........        388  .........             388
    Ethiopia...................................................  .........      7,181  .........           7,181
    Gambia.....................................................  .........        914  .........             914
    Ghana......................................................  .........        804  .........             804
    Georgia....................................................      5,038  .........  .........           5,038
    Guatemala..................................................  .........      1,761  .........           1,761
    Guinea.....................................................  .........      1,257  .........           1,257
    Haiti......................................................  .........      2,908  .........           2,908
    Honduras...................................................  .........        506  .........             506
    India......................................................  .........     18,227  .........          18,227
    Kenya......................................................  .........      6,637  .........           6,637
    Kyrgyzstan.................................................      3,283  .........  .........           3,283
    Liberia....................................................  .........      4,823  .........           4,823
    Madagascar.................................................  .........      2,895  .........           2,895
    Mali.......................................................  .........        623  .........             623
    Mauritania.................................................  .........        307  .........             307
    Mozambique.................................................  .........      3,967  .........           3,967
    Nicaragua..................................................      2,200        497  .........           2,696
    Niger......................................................  .........        108  .........             108
    Pakistan...................................................  .........      2,754  .........           2,754
    Peru.......................................................  .........     32,835  .........          32,835
    Rwanda.....................................................  .........      2,057  .........           2,057
    Serbia.....................................................  .........      1,497  .........           1,497
    Sierra Leone...............................................  .........      4,495  .........           4,495
    Sudan......................................................  .........      2,050  .........           2,050
    Tajikistan.................................................  .........        452  .........             452
    Uganda.....................................................  .........      4,515  .........           4,515
    Unspecified................................................  .........      1,445  .........           1,445
                                                                ------------------------------------------------
      Sub-Total................................................     19,504    112,900  .........         132,404
                                                                ================================================
 
Wheat:
    Albania....................................................      3,229  .........  .........           3,229
    Angola.....................................................      3,884  .........  .........           3,884
    Armenia....................................................     13,282  .........  .........          13,282
    Bangladesh.................................................      5,964     23,432  .........          29,396
    Benin......................................................  .........        194  .........             194
    Bolivia....................................................      6,580        615  .........           7,195
    Bosnia-Herzegovina.........................................      6,181      1,639  .........           7,821
    Cape Verde Islands.........................................  .........      1,105  .........           1,105
    Eritrea....................................................      8,000  .........      3,199          11,199
    Ethiopia...................................................  .........     13,118      6,480          19,598
    Georgia....................................................      8,320  .........  .........           8,320
    Ghana......................................................  .........      6,813  .........           6,813
    Guatemala..................................................      1,500  .........  .........           1,500
    Guyana.....................................................      6,835  .........  .........           6,835
    Haiti......................................................  .........  .........      7,154           7,154
    Honduras...................................................  .........        982  .........             982
    Jordan.....................................................     18,000        725  .........          18,725
    Mongolia...................................................      3,124  .........  .........           3,124
    Mozambique.................................................      3,499     11,861      4,502          19,862
    Nicaragua..................................................      8,300  .........  .........           8,300
    Pakistan...................................................  .........      2,055  .........           2,055
    Peru.......................................................     10,000  .........  .........          10,000
    Rwanda.....................................................  .........      2,901  .........           2,901
    Sri Lanka..................................................     10,000  .........  .........          10,000
    Tajikistan.................................................      4,939      1,478  .........           6,417
    Uganda.....................................................  .........      1,367  .........           1,367
    Zimbabwe...................................................     10,000  .........  .........          10,000
                                                                ------------------------------------------------
      Sub-Total................................................    131,636     68,284     21,335         221,256
                                                                ================================================
 
Wheat Flour:
    Albania....................................................  .........        165  .........             165
    Algeria....................................................  .........        296  .........             296
    Bolivia....................................................  .........      5,262  .........           5,262
    Bosnia-Herzegovina.........................................  .........      3,014  .........           3,014
    Bulgaria...................................................  .........      1,684  .........           1,684
    Chad.......................................................  .........        296  .........             296
    Djbouti....................................................  .........        183  .........             183
    Egypt......................................................  .........        788  .........             788
    Haiti......................................................  .........      6,028  .........           6,028
    Mali.......................................................  .........        296  .........             296
    Peru.......................................................  .........      1,919  .........           1,919
    Rwanda.....................................................  .........         79  .........              79
    Serbia.....................................................  .........      3,079  .........           3,079
    Unspecified................................................  .........      1,379  .........           1,379
                                                                ------------------------------------------------
      Sub-Total................................................  .........     24,467  .........          24,467
                                                                ================================================
 
Wheat Soy Blend:
    Benin......................................................  .........        454  .........             454
    Bolivia....................................................  .........        621  .........             621
    Ghana......................................................  .........        221  .........             221
    Haiti......................................................  .........        691  .........             691
    Indonesia..................................................  .........      3,655  .........           3,655
    Mauritania.................................................  .........        275  .........             275
    Nepal......................................................  .........        388  .........             388
                                                                ------------------------------------------------
      Sub-Total................................................  .........      6,305  .........           6,305
                                                                ------------------------------------------------
 
                        Fiscal Year 1999
 
Barley:
    Armenia....................................................      8,160  .........  .........           8,160
                                                                ------------------------------------------------
      Sub-Total................................................  .........      8,160  .........           8,160
                                                                ================================================
 
Beans:
    Angola.....................................................  .........      1,868  .........           1,868
    Burkina Faso...............................................  .........      1,410  .........           1,410
    Dominican Republic.........................................  .........      1,325  .........           1,325
    El Salvador................................................  .........        387  .........             387
    Ethiopia...................................................  .........        297  .........             297
    Guatemala..................................................  .........      2,728  .........           2,728
    Haiti......................................................  .........        220  .........             220
    Honduras...................................................  .........      6,149  .........           6,149
    Nicaragua..................................................      9,201        825  .........          10,026
    Unspecified................................................  .........      1,034  .........           1,034
                                                                ------------------------------------------------
      Sub-Total................................................      9,201     16,242  .........          25,443
                                                                ================================================
 
Beef:
    Russia.....................................................    256,200  .........  .........         256,200
                                                                ------------------------------------------------
      Sub-Total................................................  .........    256,200  .........         256,200
                                                                ================================================
 
Bulgur:
    Guatemala..................................................  .........          3  .........               3
    India......................................................  .........      6,842  .........           6,842
    Liberia....................................................  .........      1,227  .........           1,227
    Peru.......................................................  .........      1,419  .........           1,419
    Sierra Leone...............................................  .........      3,028  .........           3,028
    Unspecified................................................  .........      1,727  .........           1,727
                                                                ------------------------------------------------
      Sub-Total................................................  .........     14,245  .........          14,245
                                                                ================================================
 
Corn:
    Angola.....................................................  .........      1,110  .........           1,110
    Bosnia-Herzegovina.........................................      3,201  .........  .........           3,201
    Ecuador....................................................      5,000  .........  .........           5,000
    El Salvador................................................  .........        313  .........             313
    Eritrea....................................................      6,000  .........  .........           6,000
    Guatemala..................................................      5,200      7,145  .........          12,345
    Honduras...................................................      6,403      2,546  .........           8,948
    Kyrgyzstan.................................................      6,253  .........  .........           6,253
    Nicaragua..................................................  .........      1,015  .........           1,015
    Russia.....................................................     50,150  .........  .........          50,150
    Somalia....................................................  .........        399  .........             399
                                                                ------------------------------------------------
      Sub-Total................................................     82,207     12,527  .........          94,734
                                                                ================================================
 
    Afghanistan................................................  .........        791  .........             791
    Angola.....................................................  .........        462  .........             462
    Bolivia....................................................  .........        301  .........             301
    Gambia.....................................................  .........        524  .........             524
    Guinea.....................................................  .........         57  .........              57
    Guatemala..................................................  .........        899  .........             899
    Honduras...................................................  .........        584  .........             584
    India......................................................  .........     43,919  .........          43,919
    Kenya......................................................  .........        355  .........             355
    Liberia....................................................  .........        923  .........             923
    Madagascar.................................................  .........        641  .........             641
    Nicaragua..................................................  .........        490  .........             490
    Peru.......................................................  .........      1,350  .........           1,350
    Sierra Leone...............................................  .........        571  .........             571
    Sudan......................................................  .........        374  .........             374
    Unspecified................................................  .........      2,678  .........           2,678
                                                                ------------------------------------------------
      Sub-Total................................................  .........     55,021  .........          55,021
                                                                ================================================
 
Cornmeal:
    Benin......................................................  .........        217  .........             217
    Guinea.....................................................  .........        445  .........             445
    Haiti......................................................  .........         98  .........              98
    Honduras...................................................  .........      3,l59  .........           3,159
                                                                ------------------------------------------------
      Sub-Total................................................  .........      3,919  .........           3,919
                                                                ================================================
 
Lentils:
    Bolivia....................................................  .........        258  .........             258
    Egypt......................................................  .........        358  .........             358
    Ethiopia...................................................  .........        387  .........             387
    Haiti......................................................  .........      1,428  .........           1,428
    Liberia....................................................  .........        580  .........             580
    Peru.......................................................  .........        619  .........             619
    Russia.....................................................     10,649  .........  .........          10,649
    Sierra Leone...............................................  .........      1,833  .........           1,833
    Sudan......................................................  .........      1,969  .........           1,969
    Unspecified................................................  .........      1,206  .........           1,206
                                                                ------------------------------------------------
      Sub-Total................................................     l0,649      8,639  .........          l9,287
                                                                ================================================
 
Nonfortified Nonfat Milk:
    Russia.....................................................     73,200  .........  .........          73,200
                                                                ------------------------------------------------
      Sub-Total................................................     73,200  .........  .........          73,200
                                                                ================================================
 
Peas:
    Bolivia....................................................  .........        842  .........             842
    Cameroon...................................................  .........        165  .........             165
    Haiti......................................................  .........        569  .........             569
    Guinea.....................................................  .........        250  .........             250
    Liberia....................................................  .........        267  .........             267
    Peru.......................................................  .........        776  .........             776
    Unspecified................................................  .........        275  .........             275
                                                                ------------------------------------------------
      Sub-Total................................................  .........      3,144  .........           3,144
                                                                ================================================
 
Rice:
    Angola.....................................................      4,176  .........  .........           4,176
    Burkina Faso...............................................  .........      1,954  .........           1,954
    Cameroon...................................................  .........        948  .........             948
    Cote D'Ivoire..............................................      5,000  .........  .........           5,000
    Dominican Republic.........................................  .........      4,396  .........           4,396
    El Salvador................................................  .........        695  .........             695
    Ghana......................................................  .........        245  .........             245
    Guatemala..................................................  .........      2,358  .........           2,358
    Honduras...................................................  .........      9,787  .........           9,787
    Indonesia..................................................     38,000      7,686  .........          45,686
    Jamaica....................................................      5,000  .........  .........           5,000
    Madagascar.................................................  .........        102  .........             102
    Nicaragua..................................................  .........      2,855  .........           2,855
    Peru.......................................................  .........      1,296  .........           1,296
    Russia.....................................................     48,792  .........  .........          48,792
    Unspecified................................................  .........        732  .........             732
                                                                ------------------------------------------------
      Sub-Total................................................    100,968     33,054  .........         134,022
                                                                ================================================
 
Pork:
    Russia.....................................................     43,850  .........  .........          43,850
                                                                ------------------------------------------------
    Sub-Total..................................................     43,850  .........  .........          43,850
    Russia.....................................................    156,000  .........  .........         156,000
                                                                ------------------------------------------------
      Sub-Total................................................    156,000  .........  .........         156,000
                                                                ================================================
 
Salmon:
    Russia.....................................................      7,800  .........  .........           7,800
                                                                ------------------------------------------------
      Sub-Total................................................      7,800  .........  .........           7,800
                                                                ================================================
 
Seeds:
    Russia.....................................................     32,535  .........  .........          32,535
                                                                ------------------------------------------------
      Sub-Total................................................     32,535  .........  .........          32,535
                                                                ================================================
 
Sorghum:
    Ghana......................................................  .........        443  .........             443
    Philippines................................................      1,000  .........  .........           1,000
    Somalia....................................................  .........        917  .........             917
    Sudan......................................................  .........      3,872  .........           3,872
    Zambia.....................................................  .........        635  .........             635
                                                                ------------------------------------------------
      Sub-Total................................................      1,000      5,867  .........           6,867
                                                                ================================================
 
Soybean Meal:
    Georgia....................................................      2,117  .........  .........           2,117
    Guyana.....................................................      5,000  .........  .........           5,000
    Honduras...................................................      1,711  .........  .........           1,711
    Kyrgyzstan.................................................      3,303  .........  .........           3,303
    Philippines................................................      9,000  .........  .........           9,000
    Russia (USAPEEC)...........................................     59,800  .........  .........          59,800
                                                                ------------------------------------------------
      Sub-Total................................................     80,931  .........  .........          80,931
                                                                ================================================
 
Soybeans:
    Guatemala..................................................      3,800  .........  .........           3,800
    Russia.....................................................     43,472  .........  .........          43,472
                                                                ------------------------------------------------
      Sub-Total................................................     47,272  .........  .........          47,272
                                                                ================================================
 
S. F. Bulgur:
    Bolivia....................................................  .........        353  .........             353
    Burkina Faso...............................................  .........      2,279  .........           2,279
    Ghana......................................................  .........        187  .........             187
    Guatemala..................................................  .........        251  .........             251
    Haiti......................................................  .........      4,054  .........           4,054
    Madagascar.................................................  .........        355  .........             355
                                                                ------------------------------------------------
    Sub-Total..................................................  .........      7,480  .........           7,480
    Bolivia....................................................  .........         68  .........              68
    Chad.......................................................  .........        435  .........             435
    Unspecified................................................  .........      1,360  .........           1,360
                                                                ------------------------------------------------
      Sub-Total................................................  .........      1,863  .........           1,863
                                                                ================================================
 
S. F. Sorghum Grits:
    Ghana......................................................  .........      1,595  .........           1,595
    Mauritania.................................................  .........        261  .........             261
    Sudan......................................................  .........      1,185  .........           1,185
                                                                ------------------------------------------------
      Sub-Total................................................  .........      3,041  .........           3,041
                                                                ================================================
 
Tallow:
    El Salvador................................................      5,000  .........  .........           5,000
    Guatemala..................................................      1,000  .........  .........           1,000
                                                                ------------------------------------------------
      Sub-Total................................................      6,000  .........  .........           6,000
                                                                ================================================
 
Vegetable Oil:
    Angola.....................................................      4,361      1,287  .........           5,648
    Bangladesh.................................................  .........      3,206  .........           3,206
    Benin......................................................  .........        472  .........             472
    Bosnia-Herzegovina.........................................      3,549  .........  .........           3,549
    Burkina Faso...............................................  .........      1,261  .........           1,261
    Cameroon...................................................  .........         81  .........              81
    Djibouti...................................................  .........        135  .........             135
    Dominican Republic.........................................  .........      1,011  .........           1,011
    El Salvador................................................      5,000        108  .........           5,108
    Ethiopia...................................................  .........      2,294  .........           2,294
    Gambia.....................................................  .........      1,239  .........           1,239
    Georgia....................................................      2,199  .........  .........           2,199
    Ghana......................................................  .........      1,806  .........           1,806
    Guinea.....................................................  .........        442  .........             442
    Guatemala..................................................  .........      1,193  .........           1,193
    Haiti......................................................  .........      3,666  .........           3,666
    Honduras...................................................  .........      3,711  .........           3,711
    India......................................................  .........     26,653  .........          26,653
    Kenya......................................................  .........      6,673  .........           6,673
    Liberia....................................................  .........        126  .........             126
    Madagascar.................................................  .........      1,170  .........           1,170
    Mauritania.................................................  .........        208  .........             208
    Mozambique.................................................  .........      5,607  .........           5,607
    Nicaragua..................................................  .........        840  .........             840
    Peru.......................................................  .........     37,884  .........          37,884
    Russia.....................................................     13,780  .........  .........          13,780
    Serbia.....................................................  .........      2,989  .........           2,989
    Sierra Leone...............................................  .........      1,688  .........           1,688
    Sudan......................................................  .........      2,532  .........           2,532
    Uganda.....................................................  .........      4,380  .........           4,380
    Unspecified................................................  .........      3,142  .........           3,142
                                                                ------------------------------------------------
      Sub-Total................................................     28,889    115,805  .........         144,695
                                                                ================================================
 
Wheat:
    Benin......................................................  .........        248  .........             248
    Cape Verde Islands.........................................  .........        303  .........             303
    Ethiopia...................................................  .........      3,260  .........           3,260
    Ghana......................................................  .........      6,671  .........           6,671
    Honduras...................................................  .........      1,116  .........           1,116
    Indonesia..................................................     12,309  .........  .........          12,309
    Madagascar.................................................  .........        253  .........             253
    Mozambique.................................................  .........      8,837  .........           8,837
    Pakistan...................................................     13,724  .........  .........          13,724
    Russia.....................................................     27,200  .........  .........          27,200
    Uganda.....................................................  .........      1,838  .........           1,838
                                                                ------------------------------------------------
      Sub-Total................................................     53,233     22,525  .........          75,759
                                                                ================================================
 
Wheat Flour:
    Bolivia....................................................  .........      5,843  .........           5,843
    Chad.......................................................  .........        197  .........             197
    Djibouti...................................................  .........        296  .........             296
    Haiti......................................................  .........      6,072  .........           6,072
    Mali.......................................................  .........        197  .........             197
    Peru.......................................................  .........      1,223  .........           1,223
    Serbia.....................................................  .........      3,483  .........           3,483
    Unspecified................................................  .........      1,257  .........           1,257
                                                                ------------------------------------------------
      Sub-Total................................................  .........     18,567  .........          18,567
                                                                ================================================
 
Wheat Soy Blend:
    Benin......................................................  .........        512  .........             512
    Ghana......................................................  .........        198  .........             198
    Haiti......................................................  .........      1,102  .........           1,102
    Mauritania.................................................  .........        275  .........             275
                                                                ------------------------------------------------
      Sub-Total................................................  .........      2,087  .........           2,087
                                                                ================================================
 
Undesignated:
    Unspecified (Private Trade)................................     10,000  .........  .........          10,000
                                                                ------------------------------------------------
      Subtotal.................................................     10,000  .........  .........          10,000
                                                                ================================================
 
    Allocated Commodities......................................  1,123,437    469,000     18,969       1,611,406
    Reserve....................................................    115,343    144,972     18,969         279,284
                                                                ================================================
    Program Totals.............................................  1,238,780    613,972     37,938       1,890,690
----------------------------------------------------------------------------------------------------------------
\1\ Allocations do not include transportation costs.

                       cochran fellowship program
    Question. The fiscal year 2000 budget proposes to maintain FAS 
funding for the Cochran Fellowship Program at a level of $3,500,000. 
Are available resources sufficient to extend fellowships to all 
countries which seek to participate in the program? If not, what 
additional funding would be required to meet these requests?
    Answer. The success of the Cochran Fellowship Program to initiate 
and pursue short- and long-term trade objectives and to influence 
public- and private-sector decision makers has led to increased 
requests to initiate the program in countries around the world. For 
fiscal year 2000, we have had requests from our Agricultural Affairs 
Offices to start a Cochran Program in Oman, India, Sri Lanka, Cambodia, 
and Pakistan, and expect requests for several additional African, 
Middle Eastern, and Latin American countries. The most frequent 
requests for the Cochran Program are to provide training in areas 
related to WTO/CODEX agricultural issues, food safety, sanitary and 
phytosanitary (SPS) issues, genetically modified organisms (GMOs), and 
biotechnology. At present, the Cochran Fellowship Program is able to 
provide a fellowship to about twenty-five percent of its potential 
candidates.
    Question. Please provide fiscal year 1998 and fiscal year 1999 
program participant levels by country and region.
    Answer. In fiscal year 1998, a total of 567 participants from 48 
countries received training. This information is presented by country 
and by region.
    [The information follows:]

                        [Numbers of Participants]
------------------------------------------------------------------------
                                               1998          1994-1998
------------------------------------------------------------------------
                 AFRICA
 
 Cote d' Ivoire.........................               4             155
Iraq....................................             \1\              78
Algeria.................................             \1\              82
Tunisia.................................               9              34
South Africa............................              20              87
Namibia.................................             \1\               5
Kenya...................................               3               8
Uganda..................................               3               5
Senegal.................................               4               7
                                         -------------------------------
    Subtotal............................              43             461
                                         ===============================
                  ASIA
 
Korea...................................               7             210
Taiwan..................................             \1\              99
Malaysia................................              14             180
Singapore...............................             \1\             113
Hong Kong...............................             \1\              47
China...................................              30             250
Thailand................................              15             153
Indonesia...............................               3              43
Philippines.............................              15              77
Vietnam.................................              23              42
                                         -------------------------------
    Subtotal............................             107           1,214
                                         ===============================
              LATIN AMERICA
 
Mexico..................................               8             597
Venezuela...............................              15             277
Trinidad & Tobago.......................               4              91
Caribbean...............................               8              24
Colombia................................              22             113
Panama..................................               7              49
Chile...................................               4              15
Costa Rica..............................               3               3
Guatemala...............................               5               5
Brazil..................................               8               8
                                         -------------------------------
    Subtotal............................              84           1,182
                                         ===============================
      NEW INDEPENDENT STATES (NIS)
 
Russia..................................              46             487
Ukraine.................................              39             213
Belarus.................................             \1\              42
Kazakstan...............................              25             126
Kyrgyzstan..............................              17              80
Uzbekistan..............................              13              81
Turkmenistan                                           7              55
Tajikistan                                             7              41
Armenia.................................              11              69
Moldova.................................              17              84
Georgia.................................               7              47
Azerbaijan..............................               7              24
                                         -------------------------------
    Subtotal............................             196           1,349
                                         ===============================
              NON-EU EUROPE
 
Turkey..................................              17             336
Yugoslavia..............................             \1\              94
Poland..................................              18             502
Hungary.................................              10             145
Czech Republic..........................              15             216
Slovakia................................               3              95
Bulgaria................................              12             184
Malta...................................             \1\               2
Albania.................................               5              49
Croatia.................................               6              36
Slovenia................................              15              65
Latvia..................................               6              31
Estonia.................................               6              33
Lithuania...............................               7              29
Romania.................................              13              37
Bosnia..................................               4               4
                                         -------------------------------
    Subtotal............................             137           1,858
                                         ===============================
    TOTALS..............................             567           6,064
------------------------------------------------------------------------
\1\ Did not participate in the program

    We estimate we will be able to provide training for 760 
participants in fiscal year 1999. In addition to the countries listed 
above, we are starting pilot Cochran Programs in Tanzania, Ghana, 
Nigeria, and Morocco.
    Question. Please provide examples of the benefits of the 1998 
Cochran Program to U.S. agriculture.
    Answer. The Cochran Fellowship Program provides a cost effective 
tool in promoting U.S. agricultural exports, addressing policy issues 
such as are related to food safety, biotechnology, and other non-tariff 
barriers to trade; promoting mutually beneficial trade and business 
linkages, as well as fostering goodwill with the United States.
  --A fiscal year 1997 Vietnamese participant has purchased about two 
        containers of U.S. pistachios per month since his training in 
        May 1997. The estimated value is about $300,000 per year. 
        Several Vietnamese participants in a fiscal year 1998 
        Supermarket Management Program bought 18 containers of U.S. 
        consumer ready products as a result of their training and 
        attendance at the Food Marketing Institute/National Association 
        of State Departments of Agriculture (FMI/NASDA) Food Expo in 
        Chicago in May 1998.
  --The Agricultural Trade Office in Shanghai, China reports that a 
        fiscal year 1998 Produce Marketing team member purchased, for 
        the first time, two containers of California table grapes after 
        his training. Another team member increased his purchase of 
        U.S. celery from 10 to 15 containers per week. Chinese seafood 
        importers purchased 1,700 tons of yellow fin sole, three 
        containers of squid, two containers of conch, and five 
        containers of frozen scallops from the U.S. after their May, 
        1998, Cochran training. More U.S. seafood sales are expected in 
        the future.
  --U.S. Wheat Associates and the Cochran Program organized a Grain 
        Marketing & Import Management training program for Armenia and 
        Georgia in fiscal year 1998. U.S. Wheat writes: ``. . . we felt 
        we had phenomenal success in bringing this industry core to the 
        U.S. commercial wheat market. Following, and as a direct result 
        of that program, we saw several cargoes of U.S. wheat purchased 
        commercially.''
  --The Agricultural Office in Beijing, China states: ``We continue to 
        see double digit growth in the U.S. export of high value 
        products to China and we firmly believe that the Cochran 
        Program is a major reason for this growth.''
  --The team leader of the fiscal year 1998 China Beef Grading program 
        was promoted to Vice Chancellor at Nanjung Agricultural 
        University. As a result of the program, China developed their 
        first beef grading system. According to the Shanghai ATO ``. . 
        . our strengthened connections between the Vice Chancellor and 
        USDA will help USDA and many of its cooperators for many years 
        to come.''
  --A Thailand Cochran participant reports that he purchased large 
        quantities of raw popcorn, raw almonds, prunes, and other 
        fruits and nuts after his May, 1998 Cochran training in 
        supermarket management. The FAS Agricultural Officer in 
        Thailand states: ``the ongoing economic crisis in Thailand may 
        be forestalling additional sales that could be attributed to 
        participation in the program, but the groundwork has been laid 
        for such sales.''
  --Prior to her departure from the U.S., a Hungarian participant 
        purchased eight containers (20 foot) of walnut meal, 8 
        containers of almonds, as well as 400 cases of Maraschino 
        cherries.
    During fiscal year 1998, 42 Cochran fellows from 14 countries 
participated in training programs directly related to providing 
information on the safety of the U.S. food and fiber system as well as 
providing direct contact with U.S. counterparts. In addition, 11 
participants from 4 countries received training in biotechnology and 
Genetically Modified Organisms (GMO). As a result, these countries have 
a better understanding of the U.S. food safety and biotechnology 
systems. For example:
  --The FAS Agricultural Office in Poland states that Cochran-trained 
        veterinarians were able to help release two shipments of U.S. 
        cheese which had been held up.
  --The new Minister of Agriculture in Lithuania, Dr. Edvardas Makelis, 
        is a 1996 graduate of the Cochran Fellowship Program. The 
        Agricultural Affairs Office in Poland states that Minister 
        Makelis . . . '' warmly expressed his appreciation for his 
        participation in USDA's Cochran Fellowship Program in 1996 and 
        stated that he would like to expand opportunities for 
        cooperation between the Ministry of Agriculture and USDA. The 
        Minister offered to help resolve the problem of trade barriers 
        in livestock genetics that has prohibited U.S. exporters to 
        supply livestock semen and embryos to Lithuania.''
  --After his training, a lawyer of the Hungarian Ministry of 
        Agriculture, one of the drafters of Hungary's new act on 
        Genetically Modified Organisms helped to arrange a 
        biotechnology seminar in Budapest and is a good contact (for 
        USDA) to the Government of Hungary for the recently established 
        Biotechnology Association.
  --The Agricultural Office in Malaysia states that a Cochran 
        biotechnology participant ``. . . acquired beneficial 
        information from the program which was put to use in her 
        research work on plant genetic modification, and this has 
        enabled her to participate actively in the Malaysian 
        Modification Advisory Group.''
  --The Agricultural Office in Brazil states that the Cochran training 
        in food regulations improved the understanding of Brazilian 
        food regulators of the concept of consistency and transparency 
        of information related to food inspection and trade under the 
        WTO. It also improved the confidence of Brazilian food 
        regulators of the U.S. food inspection system, and food 
        certification for export.
  --The Agricultural Attache in Bulgaria states: ``One company involved 
        in the Fiscal year 1998 High Value Products team has contacted 
        the office and said it plans to import U.S. products. Two 
        members of the fiscal year 1998 Meat Products Team are 
        currently using U.S. meat and additives for meat processing 
        because of the visit.''
  --The Agricultural Office in Austria states that a Czech company 
        started to import U.S. cranberries as a result of their Cochran 
        Program visit to the U.S. distributor. Fiscal year 1997 South 
        African participants have purchased California wine ($12,000) 
        and two containers of processed cheese ($62,000).
  --A staff member of the Wisconsin Department of Agriculture states: 
        ``Thank you for allowing us to work with the Cochran Fellowship 
        Program to bring cheese buyers from Mexico to Wisconsin. I have 
        already been back to Mexico to meet with the buyers and I am 
        very excited about the potential business for Wisconsin cheese 
        companies. One Wisconsin cheese manufacturer was able to 
        introduce their products into Mexican stores and predicts 
        $200,000 of sales annually to the Mexican market.''
  --The New Jersey Department of Agriculture hosted a Russian seafood 
        importer. They report that ``our companies had the opportunity 
        to gain a better understanding of how to conduct business in 
        Russia.''
  --The FAS Agricultural Officer in Vietnam writes: ``The Cochran 
        Program has provided a key for unlocking some of the more non-
        transparent areas of the Government of Vietnam (GVN) import 
        regime. This has been extremely helpful in the context of the 
        Bilateral Trade Agreement (BTA) negotiations. This access has 
        enabled us to advocate on behalf of U.S. companies in Vietnam 
        and has led to increased sales of U.S. commodities. We also 
        have been better able to explain the import regulations to 
        USDA/FAS for dissemination to potential exporters.''--South 
        African Cochran alumni are helping formulate agricultural 
        policy. For example, one participant is helping consolidate a 
        draft of the South African national agricultural policy paper 
        focusing on public/private sector partnerships; another is 
        formulating agricultural credit policy at the national level; 
        and others are involved at the provincial and local levels in 
        policy areas such as rural electrification, market information 
        systems, land tenure and regional trade.
                         market access program
    Question. Please provide the Market Access Program allocations for 
fiscal year 1998, including the amount of the grant, and the recipient 
company, commodity, and targeted markets.
    Answer. The information is provided for the record.
    [The information follows:]
    [GRAPHIC] [TIFF OMITTED] T01MR02.001
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.002
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.003
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.004
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.005
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.006
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.007
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.008
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.009
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.010
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.011
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.012
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.013
    
    [GRAPHIC] [TIFF OMITTED] T01MR02.014
    
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    Question. Please provide for the record a list of the benefits of 
the Market Access Program to U. S. agriculture in each of the fiscal 
years 1997 and 1998.
    Answer. The information is provided for the record.
    [The information follows:]

                                                                                1997 MAP BRAND EXPENSES BY STATE
 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
              Company                            City                  State             Zip                                       Promoted--Produce                                   Expenses
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Green Connection, Inc..............  Anchorage...................  AK...........  99501...........  Potted Tropical foliage Plants and Flowers.....................................       $2,550
Transcon Trading Co., Inc..........  Bentonville.................  AR...........  72712...........  animal feed....................................................................       51,222
American Eagle Beverages, Inc......  Temple......................  AZ...........  85283...........  Beverages......................................................................      204,410
Azmex Foods, Inc...................  Mesa........................  AZ...........  85202...........  Dairy Products.................................................................       33,000
Black Mountain Brewing Co..........  Cave Creek..................  AZ...........  85331...........  Beer...........................................................................  ...........
Chez De Prez Cheesecake, Inc.......  Phoenix.....................  AZ...........  85017...........  cheese cake....................................................................      110,000
Adams & Brooks, Inc................  Los Angeles.................  CA...........  90007...........  Candy..........................................................................        1,658
Alta Genetics......................  Hughson.....................  CA...........  95326...........  Bovine Genetics................................................................       18,310
America's Classic Foods............  Sun Valley..................  CA...........  91352...........  Mixed & Processed: Bakery products, hard and soft ice cream....................        8,475
Apcal, Inc.........................  Visalia.....................  CA...........  93278...........  Natural & Processed Almonds, Shelled & Inshell Pistachios......................        4,439
Arciero Winery.....................  Paso Robles.................  CA...........  93447...........  Wine...........................................................................        6,179
Ariel Vineyards....................  Napa........................  CA...........  94558...........  wine...........................................................................        1,043
Babe Farms.........................  Santa Monica................  CA...........  93456...........  vegetables.....................................................................  ...........
Bay Pac Beverages..................  Pleaston....................  CA...........  94588...........  juice, sport drinks............................................................       40,009
Bell-Carter Foods, Inc.............  Visalia.....................  CA...........  93291...........  Canned Ripe Olives.............................................................        6,918
California Natural Products........  Santa Barbara...............  CA...........  93121...........  Bard Valley Medjool Dates......................................................       10,000
California Grocer Inc..............  San Rafael..................  CA...........  94903...........  Salad Dressing, Mayonnaise, Jams...............................................       96,357
California Sun Dry Foods...........  San Mateo...................  CA...........  94404...........  tomatoes.......................................................................  ...........
CenzoneTech Inc....................  San Marcos..................  CA...........  92069...........  enzymes, acid, lactose.........................................................       11,351
Chains, lnc........................  Fremont.....................  CA...........  94538...........  Fresh, frozen, canned, grocery product line....................................  ...........
Christopher Ranch..................  Gilroy......................  CA...........  95020...........  Condiments.....................................................................  ...........
Concannon Vineyard.................  Livermore...................  CA...........  94550...........  wine...........................................................................        5,874
Craft Beers International..........  San Diego...................  CA...........  92122...........  beer...........................................................................          616
Crichton Hall Vineyard.............  Napa........................  CA...........  94573...........  wine...........................................................................  ...........
Cuvaison Winery....................  Calistoga...................  CA...........  94515...........  wine...........................................................................  ...........
Delicato Vineyards.................  Manteca.....................  CA...........  95336...........  wine...........................................................................       13,588
Deloach Vineyards, Inc.............  Santa Rosa..................  CA...........  95401...........  wine...........................................................................       11,500
Dreyer's Grand Ice Cream...........  Oakland.....................  CA...........  94618...........  Dairy Products.................................................................  ...........
Dry Creek Vineyard.................  Healdsburg..................  CA...........  95448...........  Wine...........................................................................        1,500
DXR International, Inc.............  Lafayette...................  CA...........  94549...........  grocery products...............................................................        1,710
Emilio Guglielmo Winery............  Morgan Hill.................  CA...........  95037...........  wine...........................................................................  ...........
Entertainment Foods, Inc...........  Calabasas...................  CA...........  91302...........  grocery products...............................................................       30,000
Extraordinary Export...............  San Anselmo.................  CA...........  94960...........  Sauces, sodas, rice noodles, maple syrup & pancake mixes.......................        1,784
Fantastic Foods, Inc...............  Petaluma....................  CA...........  94954...........  Natural & Health Foods.........................................................  ...........
Fernando's Foods Corporation.......  Los Angeles.................  CA...........  90040...........  Mexican, other burritos/wraps, appetizers......................................            0
Four Seasons Farms.................  Ripon.......................  CA...........  95366...........  almonds, roasted, flavored, candied............................................        7,388
Franciscan Estate Selections.......  Rutherford..................  CA...........  94573...........  California Wine................................................................        2,577
Frontier Trading...................  San Diego...................  CA...........  92106...........  grocery products...............................................................      200,000
Garden Of Eatin' Inc...............  Pismo Beach.................  CA...........  93449...........  Condiments.....................................................................       32,098
Garuda International, Inc..........  Santa Cruz..................  CA...........  95063...........  Natural & Health Foods.........................................................        3,899
Geyser Peak........................  Geyserville.................  CA...........  95441...........  wine...........................................................................       15,513
Golden State Vintners..............  Cutler......................  CA...........  93615...........  wine...........................................................................       86,512
Golden West Nuts, Inc..............  Ripon.......................  CA...........  95366...........  Almonds........................................................................       44,957
Goods and Sevices Int'l............  South El Monte..............  CA...........  91733...........  Non-Chocolate Soft Candy-Lemon, Lime, Cherry, orange flavor....................       60,000
Grand Export, Inc..................  Hayward.....................  CA...........  94544...........  grocery products...............................................................  ...........
Great Crescent International Inc...  Rolling Hills Est...........  CA...........  90274...........  crackers, cookies..............................................................       12,480
Greater Pacific Foods..............  Pleasanton..................  CA...........  94566...........  grocery products...............................................................  ...........
Harris Ranch Beef Company..........  Selma.......................  CA...........  93662...........  Beef...........................................................................       18,716
Herman Goelitz, Inc................  Fairfield...................  CA...........  94533...........  Confectionery..................................................................      105,508
Hill & Thoma Wines.................  Santa Rosa..................  CA...........  95404...........  California Wine................................................................          101
Hilltop Ranch......................  Ballico.....................  CA...........  95303...........  Blanched Diced, sliced, whole Almonds, and Brown Almonds,......................        8,000
Hughson Nut Marketing, Inc.........  Hughson.....................  CA...........  95326...........  Almonds........................................................................       28,757
Imagine Foods, Inc.................  Palo Alto...................  CA...........  94306...........  ice cream, puddings, beverage..................................................       38,448
International Food Concepts........  Calabasas...................  CA...........  91302...........  Breakfast Cereals/Fruit Juices.................................................      200,000
Isis Management, Inc...............  Carmel......................  CA...........  93921...........  Loaves of: Banana Nut, poppyseed, pumpkin, zucchini............................  ...........
J. Lohr Winery.....................  San Jose....................  CA...........  95126...........  wine...........................................................................          648
J.R. Wood, Inc.....................  Atwater.....................  CA...........  95301...........  Frozen Fruits & Vegetables, Smoothie Starters, Baby Food.......................       18,900
Jewel Date Company.................  Palm Desert.................  CA...........  92260...........  processed products.............................................................       35,685
Kashi Company......................  La Jolla....................  CA...........  92038...........  Cereals........................................................................        2,641
Kautz Ironstone Vineyards..........  Murphys.....................  CA...........  95247...........  wine...........................................................................       17,500
Kendall-Jackson Winery.............  Santa Rosa..................  CA...........  95403...........  wine...........................................................................       11,864
Kenwood Vineyards..................  Kenwood.....................  CA...........  95452...........  Wine...........................................................................        7,072
La Tapatia Tortilleria, Inc........  Fresno......................  CA...........  93701...........  Tex-mex Foods..................................................................  ...........
Lady-J, Inc........................  Menlo Park..................  CA...........  94025...........  Snack Foods....................................................................       50,000
Louis M. Martini Winery............  St. Helena..................  CA...........  94574...........  California Wine................................................................        1,188
Lyons Magnus.......................  Fresno......................  CA...........  93702...........  juice, beverages, snack foods, syrups, flavored toppings.......................        7,783
MCC Foods America, Inc.............  Carson......................  CA...........  90745...........  Soups; Chinese pasta, egg flower, hot & sour. Sauces, stir fry.................  ...........
Merryvale Vineyards................  St. Helena..................  CA...........  94574...........  wine...........................................................................       40,127
Nancy's Specialty Foods............  Newark......................  CA...........  94560...........  quiche.........................................................................       57,487
National Raisin Co.................  Fowler......................  CA...........  93625...........  raisins........................................................................       16,323
New Jamaican Gold, Inc.............  San Francisco...............  CA...........  94124...........  canned iced coffee.............................................................       62,377
Newton Vineyard....................  St. Helena..................  CA...........  94574...........  wine...........................................................................        1,288
Ocean Breeze Export Inc............  Exeter......................  CA...........  93221...........  Fresh California Broccoli Crowns, Cherries, Citrus, and T......................        2,075
Oceanica Trade Investment, Inc.....  Redondo Beach...............  CA...........  90277...........  seafood products...............................................................        9,249
Otis McAllister, Inc...............  San Francisco...............  CA...........  94111...........  Fruit Juices...................................................................       44,354
Pacific American Fish Co., Inc.....  Los Angeles.................  CA...........  90021...........  Squid..........................................................................        3,000
Pacific Grain Products, Inc........  Woodland....................  CA...........  95776...........  Various flavored Chips and Crackers, Industrial Snacks.........................        3,553
Pacific Trading Ventures...........  Walnut Creek................  CA...........  94596...........  yogurt, ice cream, fruit juice, cookies, popcorn, salty s......................        1,880
Pamela's Products..................  So. San Francisco...........  CA...........  94080...........  Snack Foods....................................................................        7,342
Pangburn Candy.....................  Los Angeles.................  CA...........  90007...........  Lollipops, Butter Toffee Nuts, Coffee Candy....................................  ...........
Prince Of Peace Enterprises, Inc...  San Francisco...............  CA...........  94124...........  Beverages......................................................................      144,727
Purepak, Inc.......................  Oxnard......................  CA...........  93032...........  Sliced strawberries, organic; sorbet, soups, strawberries......................       19,208
R.W. GarciaCo., Inc................  San Jose....................  CA...........  95112...........  Salad Eatos-Flavored Chip Strips, Dips and Salsas, Tortilla....................        1,462
Renaissance Vineyard & Winery, Inc.  Renaissance.................  CA...........  95962...........  wine...........................................................................        3,390
Rio Del Mar Foods, Inc.............  Orinda......................  CA...........  94563...........  almond, prune, raisin, cherries, date, apricot, tomato.........................       65,712
Round Hill Winery..................  St. Helena..................  CA...........  94574...........  wine...........................................................................          979
Royal Pacific Foods................  Pleasanton..................  CA...........  94566...........  grocery products line..........................................................       13,892
Safeway Inc........................  Walnut Creek................  CA...........  94598...........  Grocery Products Line..........................................................        2,582
Samyang Foods USA..................  Los Angeles.................  CA...........  90026...........  Instant Cup/Package Noodles, Premixed Rice w/ nuts & dried.....................       25,830
Schug Carneros Estate Winery.......  Sonoma......................  CA...........  95476...........  wine...........................................................................       11,196
Sea And Farmfresh Importing Company  Alhambra....................  CA...........  91803...........  seafood........................................................................       31,474
Sierra Nut House, Inc..............  Fresno......................  CA...........  93721...........  Dried Soup Mixes, Organic Wheat Grains, Chocolate Covered......................  ...........
Simon Home Foods Company...........  San Diego...................  CA...........  92110...........  Pretzels.......................................................................        6,180
Simonian Fruit Co..................  Fresno......................  CA...........  93711...........  fruit..........................................................................  ...........
Smith-Anderson Enterprises, Inc....  Huntington Park.............  CA...........  90255...........  California Wine................................................................       18,500
Spectrum Naturals Inc..............  Sebastopol..................  CA...........  95472...........  Condiments.....................................................................  ...........
State Fish Company, Inc............  San Pedro...................  CA...........  90731...........  seafood........................................................................        2,689
Summerfield Foods,Inc..............  Santa Rosa..................  CA...........  95401...........  Fat Free; Soup, Refried beans, Chili Cookies; `Car', 'C........................        4,517
Sutter Home Winery, Inc............  St. Helena..................  CA...........  94574...........  wine...........................................................................       56,477
The California Winery..............  Ceres.......................  CA...........  95307...........  wine...........................................................................       45,765
Timber Crest Farms.................  Healdsburg..................  CA...........  95448...........  dried fruits & tomatoes & Condiments...........................................        1,113
Traditional Medicinals Inc.........  Sebastopol..................  CA...........  95472...........  Natural & Health Foods.........................................................      185,520
Triad Worldwide, Inc...............  Clovis......................  CA...........  93613...........  nuts, raisins, canned goods, grocery products..................................      149,529
Ventana Vineyards..................  Monterey....................  CA...........  93940...........  wine...........................................................................        1,354
Very Special Chocolates, Inc.......  Azusa.......................  CA...........  91702...........  Candy..........................................................................        6,156
Well-Pict, Inc.....................  Watsonville.................  CA...........  95076...........  Fresh Fruit....................................................................       25,942
Wenix International Corp...........  Los Angeles.................  CA...........  90017...........  Seafood........................................................................       10,000
Wente Bros.........................  Livermore...................  CA...........  94550...........  wine...........................................................................      249,999
Western Sierra Packers, Inc........  Terra Bella.................  CA...........  93270...........  Citrus/Oro Blanco/Melogold.....................................................  ...........
Wild Rice Exchange.................  Yuba City...................  CA...........  95993...........  rice...........................................................................       42,440
Wines Of America, Ltd..............  Larkspur....................  CA...........  94939...........  Wine...........................................................................       13,567
World Variety Produce, Inc.........  Vernon......................  CA...........  90021...........  fruit, vegetables..............................................................  ...........
Worldwide Sires, Inc...............  Hanford.....................  CA...........  93230...........  Frozen Bovine Semen............................................................       51,018
Yorkville Cellars..................  Yorkville...................  CA...........  95494...........  wine...........................................................................  ...........
ZB Industries, Inc.................  San Pedro...................  CA...........  90733...........  Frozen Seafood Entrees, Frozen Stir-Fry Vegetables.............................        6,689
Great Western Tortilla Co..........  Denver......................  CO...........  80216...........  salsas, tortilla chips.........................................................       15,056
Leprino Foods......................  Denver......................  CO...........  80211...........  Dairy Products.................................................................        4,149
Western Export Services, Inc.......  Denver......................  CO...........  80202...........  grocery products, malt beverage, Beer..........................................      144,799
International Marketing Systems,     Shelton.....................  CT...........  06484...........  grocery products...............................................................  ...........
 Ltd..
Lincoln Snacks Company.............  Stamford....................  CT...........  06905...........  Popcorn........................................................................       60,578
Newman's Own Inc...................  Westport....................  CT...........  06880...........  salad dressing.................................................................       24,534
Pepperidge Farm Incorporated.......  Norwalk.....................  CT...........  06851...........  crackers, cookies, soup, croutons..............................................       17,477
Affair International, Inc..........  Miami Beach.................  FL...........  33140...........  Canned soft drinks.............................................................        4,593
Arnet Pharmaceutical Corp..........  Hialeah.....................  FL...........  33016...........  Vitamins.......................................................................       50,000
DLF International, Inc.............  Vero Beach..................  FL...........  32962...........  Fresh Grapefruit...............................................................       13,658
Florida European Export-lmport Co.,  Miami.......................  FL...........  33158...........  Fresh Fruits and Vegetables....................................................        6,408
Garcia Canning Co., Inc............  Tampa.......................  FL...........  33164...........  boiled peanuts, white kidney beans, black beans, chili beans...................  ...........
I.M.G. Enterprise Inc./Cherry Lake   Groveland...................  FL...........  34736...........  Fresh Grapefruit...............................................................       29,250
 Fa.
International Pet Products, Inc....  New Port Richey.............  FL...........  34652...........  Pet food.......................................................................      192,357
Ital Florida Foods, Inc............  Miami.......................  FL...........  33167...........  Pasta, ziti, spaghetti, macaroni, fetuccini....................................  ...........
Perky's Food Service Concepts, Inc.  Tampa.......................  FL...........  33610...........  Dough, refrigerated dry mixes, Pizza products, various, P......................        1,892
Sunny Ridge Farm...................  Lake Hamilton...............  FL...........  33851...........  processed food.................................................................  ...........
Tropical Blossom Honey Co., Inc....  Edgewater...................  FL...........  32132...........  Honey, Hot Sauces, Spice Mix, Fruit Drinks, Coconut Toast......................        4,763
Allied Foods, Inc..................  Atlanta.....................  GA...........  30318...........  Pet foods......................................................................       35,344
American Tanning & Leather Company.  Griffen.....................  GA...........  30223...........  Alligator Hides................................................................        3,061
Chihade lnternational, Inc.........  Stone Mountain..............  GA...........  30083...........  Citrus Juices..................................................................      176,851
The Matterhorn Company.............  Marietta....................  GA...........  30062...........  Ice Cream Sandwiches...........................................................  ...........
Equipment Team Hawaii..............  Honolulu....................  HI...........  96820...........  fruit..........................................................................       50,183
French Gourmet Inc.................  Honolulu....................  HI...........  96813...........  Bakery Products................................................................       96,893
Hawaiian Host, Inc.................  Honolulu....................  HI...........  96817...........  Chocolate Covered Macadamia nuts and Other Related Products....................  ...........
Pleasanton Corporation.............  Waimanalo...................  HI...........  96795...........  Tropical Plants................................................................  ...........
M. Miyamoto Orchids, Inc...........  Walanae.....................  HI...........  96792...........  Various Orchid Genera..........................................................  ...........
American Pop Corn Company..........  Sioux City..................  IA...........  51102...........  popcorn........................................................................      168,932
American Protein Corporation.......  Ames........................  IA...........  50010...........  Porcine/Bov. Immunoglobulin, Plasma & Alb......................................       19,198
Ampc, Inc..........................  Ames........................  IA...........  50010...........  80 Percent WPC.................................................................       46,649
Burke Corp.........................  Nevada......................  IA...........  50201...........  Meat Toppings..................................................................       15,025
Elite Genetics.....................  Waukon......................  IA...........  52172...........  Sheep Semen....................................................................       19,843
Kemin Industries, Inc..............  Des Moines..................  IA...........  50301...........  Swine Feed, Dog Food-dry, Cat Food-dry.........................................        1,075
Maplehurst Genetics................  Keota.......................  IA...........  52248...........  Frozen Bovine Semen............................................................        3,000
Midamar Corporation................  Cedar Rapids................  IA...........  52406...........  poultry, processed meats.......................................................        8,341
Triple F. Inc......................  Des Moines..................  IA...........  50322...........  Animal Feed Additives..........................................................        4,154
Agri Beef Co.......................  Boise.......................  ID...........  83707...........  Beef...........................................................................  ...........
Gering And Son.....................  Nampa.......................  ID...........  83687...........  Canned & Frozen Foods..........................................................  ...........
Idaho Pacific Corporation..........  Ririe.......................  ID...........  83443...........  Seasoned & regular Potato Granules, Potato Flakes, Potato......................        8,399
Idahoan Foods......................  Lewisville..................  ID...........  83431...........  potato products................................................................      127,981
Market Makers, Inc.................  Boise.......................  ID...........  83701...........  Further processed chicken......................................................       13,209
Beer Nuts Inc......................  Bloomington.................  IL...........  61701...........  peanuts, Cashews...............................................................        5,630
Coffee Masters.....................  Ingleside...................  IL...........  60041...........  instant cappuccino and cocoa...................................................        1,802
Eli's Chicago's Finest Cheasecake..  Chicago.....................  IL...........  60634...........  Baked Cheese Cake..............................................................        3,620
Essen Nutrition Corp...............  Romeoville..................  IL...........  60446...........  sauces, syrup, mixes, salad dressings, mayonnaise..............................       12,738
Ferrara Pan Candy Company..........  Forest Park.................  IL...........  60130...........  Confectionery..................................................................        1,230
Lawrence Foods, Inc................  Elk Grove Village...........  IL...........  60007...........  jellies & preserves, ice cream toppings, fillings..............................          666
Little Lady Foods, Inc.............  Elk Grove Village...........  IL...........  60007...........  French Bread Pizza, pizza products.............................................        7,703
LP International...................  Chicago.....................  IL...........  60632...........  Salsas, Taco Shells............................................................       13,351
Milk Specialties Co................  Dundee......................  IL...........  60118...........  Horse & Dairy Feed.............................................................        2,80X
Park Foods L.P.....................  Barrington..................  IL...........  60010...........  Drink Mixes, Cake Mixes, Bakery Products & Ingredients.........................  ...........
Roney-Oatman.......................  Aurora......................  IL...........  60506...........  ice cream, frozen shakes.......................................................        8,084
Sahagian & Associates, Inc.........  Oak Park....................  IL...........  60302...........  Corn Sticks & popcorn kernels..................................................        2,424
The Bruss Company..................  Chicago.....................  IL...........  60641...........  Beef...........................................................................  ...........
TKI Foods, Inc.....................  Springfield.................  IL...........  62708...........  Meal Replacement...............................................................        7,068
Vienna Sausage Manufacturing Co....  Chicago.....................  IL...........  60647...........  Value added meats..............................................................       17,451
Dairy Chem Laboratories, Inc.......  Noblesville.................  IN...........  46060...........  Starter Distillates............................................................        3,609
Midwestern Pet Foods, Inc..........  Evansville..................  IN...........  47711...........  pet food (cat, dog)............................................................       85,864
B&H General Supply & Marketing Co..  Leawood.....................  KS...........  66211...........  Mayonnaise, Salad Dressing.....................................................      154,522
Pines International................  Lawrence....................  KS...........  66044...........  Wheat Powder, tabs.............................................................       95,877
Thompson's Pet Pasta Products......  Kansas City.................  KS...........  66105...........  Pet food.......................................................................      170,767
Age International, Inc.............  Frankfort...................  KY...........  40601...........  bourbon........................................................................  ...........
Heaven Hill Distilleries, Inc......  Bardstown...................  KY...........  40004...........  wine...........................................................................       61,345
Korbel Brands......................  Louisville..................  KY...........  40201...........  Wine/Brandy....................................................................       23,500
Bruce Foods Corporation............  New Iberia..................  LA...........  70562...........  Ethnic Foods...................................................................       79,643
Burris Mill & Feed, Inc............  Franklinton.................  LA...........  70438...........  shrimp feed and tilapia feed...................................................        1,299
Chef Paul Prudhomme's Magic Season.  Harahan.....................  LA...........  70183...........  Sauces and Spices..............................................................       19,209
Crown Products, Inc................  Metairie....................  LA...........  70002...........  Alligator Hides................................................................      146,933
Crystal International Corporation..  New Orleans.................  LA...........  70119...........  Trading Company General Groccry Line...........................................      260,000
KSM Seafood Corporation............  Baton Rouge.................  LA...........  70821...........  Seafood and Aquaculture........................................................       35,069
M.B.A. International Company.......  Metairie....................  LA...........  70011...........  Trading Company General Grocery Line...........................................        5,000
Mcllhenny Company..................  Avery lsland................  LA...........  70513...........  Sauces and Spices..............................................................      171,674
Panola Pepper Corp.................  Lake Providence.............  LA...........  71254...........  Hot Sauce, Jalapeno Hot Sauce, Extra Hot Hot Sauce.............................        5,580
Boston Beer Company................  Boston......................  MA...........  02130...........  Beer...........................................................................       25,248
East Coast Seafood, Inc............  Lynn........................  MA...........  01903...........  American Lobster, Skate, Monkfish, & Dogfish...................................      106,677
Ethnic Gourmet Foods Inc...........  Farmingham..................  MA...........  01702...........  Dinners (Frozen Indian)........................................................  ...........
Nasoya Foods, Inc..................  Ayer........................  MA...........  01432...........  Mayonnaise, salad dressing, tofu, seasoning mixes..............................          493
Pishev Corporationlnternational....  Boston......................  MA...........  02109...........  Chum Salmon, Hake, Smelt, and Rockfish.........................................       51,253
U.S. Mills, Inc....................  Needham.....................  MA...........  02194...........  Cereal.........................................................................        7,877
Chemgen............................  Gaithersburg................  MD...........  20877...........  feed enzyme....................................................................        8,531
PTC International..................  Baltimore...................  MD...........  21202...........  Chicken wings, cakes, pies, cheesecakes........................................        2,265
Purdue Farms, lnc..................  Salisbury...................  MD...........  21801...........  Parts and further processed chicken............................................  ...........
S.E.W. Friel.......................  Queenstown..................  MD...........  21658...........  Tomato Juice, Vegetable Juice, Corn, Succotash.................................  ...........
Sea Watch International, Ltd.......  Easton......................  MD...........  21601...........  seafood/processed foods........................................................       30,000
U.S. Grain Company.................  Towson......................  MD...........  21204...........  Pet food.......................................................................       28,626
Wilkins-Rogers, Inc................  Ellicott City...............  MD...........  21043...........  Bakery Products................................................................  ...........
Country Egg Farm...................  Turner......................  ME...........  04282...........  Shell Eggs.....................................................................  ...........
Jasper Wyman & Son.................  Milbridge...................  ME...........  04658...........  Wild Blueberries, Pie filling..................................................  ...........
The Lobster Co.....................  Kennebunkport...............  ME...........  04046...........  Lobster........................................................................        2,043
American Soy Products..............  Saline......................  MI...........  48176...........  fruit and vegetable juice......................................................          653
Argo Associates, Inc...............  Bloomfield Hills............  MI...........  48304...........  Beverage Concentrate...........................................................       19,732
Awrey Bakeries, Inc................  Livonia.....................  MI...........  48150...........  Bagels, Biscuits, Brownies, Cakes, Coffee Cakes, Cookies,......................       10,510
Cherrex Corporation................  Okemos......................  MI...........  48864...........  Frozen Cherries, Cherry Concentrate............................................       55,203
Groeb Farms, Inc...................  Onsted......................  MI...........  49265...........  honey..........................................................................       20,001
Honee Bear Canning.................  Lawton......................  MI...........  49065...........  Canned Cherries (Pitted Red Tart, Dark Sweet)..................................       40,656
Kalsec Inc.........................  Kalamazoo...................  MI...........  49005...........  extractives of paprika, hops and capsicum......................................       20,982
Purity Foods International.........  Okemos......................  MI...........  48864...........  Microwave Popcorn..............................................................      198,967
Advanced Nutritionals Corporation..  Minneapolis.................  MN...........  55369...........  Health drink & Health Gel......................................................       55,298
Dahlgren & Company, Inc............  Crookston...................  MN...........  56716...........  Dairy Products.................................................................       20,824
Davisco Foods International, Inc...  Le Sueur....................  MN...........  56058...........  Whey Protein concentrate WPC, Refined Edible Lactose...........................        3,738
Grist Mill Co......................  Lakeville...................  MN...........  55044...........  fruit snacks, granola bars.....................................................       26,938
Knight Seed Co., Inc...............  Burnsville..................  MN...........  55337...........  Confection Sunflowers, Dry Edible Beans, Soybeans..............................       13,768
Lamex Foods, Inc...................  Edina.......................  MN...........  55435...........  chicken broth..................................................................       21,066
Link Industries....................  Minong......................  MN...........  54859...........  kippered beef regular flavor, and black pepper.................................       17,388
Northland Organic Foods............  Saint Paul..................  MN...........  55105...........  Beans, Frozen Veggies, Pkg. Foods..............................................       34,271
Quali Tech, Inc....................  Chaska......................  MN...........  55318...........  Toasted Corn Germ, Flavor Particulates.........................................        6,544
Sigco Sun Products, Inc............  Breckenridge................  MN...........  56520...........  Sunflower Inshell..............................................................      107,940
Ventures East, Inc.................  Excelsior...................  MN...........  55331...........  Beef...........................................................................  ...........
Zinpro Corporation.................  Eden Prairie................  MN...........  55944...........  Roasted Corn, Beans, Margarita Mix, Vinegars, Marinade.........................       15,497
American Berkshire Association.....  Skidmore....................  MO...........  64487...........  Pork...........................................................................  ...........
Bolinger Marketing Inc.............  California..................  MO...........  65018...........  potted meat....................................................................        1,661
International Ingredient             St. Louis...................  MO...........  63116...........  feed ingredients...............................................................       42,296
 Corporation.
Raskas Foods, Inc..................  Clayton.....................  MO...........  63105...........  Cream Cheese...................................................................       35,000
Vital-EX Company...................  Kansas City.................  MO...........  64190...........  athlete/men/women vitamins.....................................................  ...........
American Poultry International, Ltd  Jackson.....................  MS...........  39236...........  Chicken parts..................................................................        2,500
De Beukelaer Corporation...........  Madison.....................  MS...........  39110...........  grocery products...............................................................       34,498
Sussie's of Mississippi, Inc.......  Marks.......................  MS...........  38646...........  Fruitcakes, Liqueur Cakes, Cheesecakes.........................................        9,172
Huckleberry Haven,Inc..............  Hungry Horse................  MT...........  59919...........  Pancake mix, jams, toppings, fillings, flavored honey..........................        2,951
I'tchik Herbs......................  Crow Agency.................  MT...........  59022...........  Herbal teas, Herbal tea mixes..................................................          825
Montana Genetics International, Inc  Bozeman.....................  MT...........  59715...........  Montana Angus Genetics.........................................................        5,974
Prickly Pear Ranch.................  Helena......................  MT...........  59601...........  Bovine Genetics................................................................        4,443
American Sales International.......  Charlotte...................  NC...........  28209...........  Shallowford Farms/Popcorn, Carolina's Best/ Popcorn............................        2,491
Beacon Sweets, Inc.................  Mooresville.................  NC...........  28115...........  Hard candy & Gummy candy in the shaped as watch/footprint......................        7,747
E. Boyd & Associates, Inc..........  Raleigh.....................  NC...........  27624...........  corn, corn products............................................................  ...........
Mr. B's Fun Foods..................  Connelly Springs............  NC...........  28612...........  Cotton Candy, Caramel Popcorn..................................................        3,051
Pogue Industries, Inc..............  Raleigh.....................  NC...........  27615...........  pasta, popcorn, sauces.........................................................      102,469
The Original Log Cabin Homes, Ltd..  Rocky Mount.................  NC...........  27802...........  log cabins.....................................................................      141,223
Triangle Products..................  Charlotte...................  NC...........  28247...........  Pet food, popcorn, snack foods.................................................        8,089
Harvest Fuel, Inc..................  Walhalla....................  ND...........  58282...........  Calf Feed......................................................................          872
Minn-Dak Growers, Ltd..............  Grand Forks.................  ND...........  58208...........  Mustard; ground, dehydrated, flour, & Sunflower Kernels........................        8,950
Specialty Commodities, Inc.........  Fargo.......................  ND...........  58106...........  Sunflower (in shell), Sunflower kernel.........................................        8,829
All NaturaULean Limousin Supreme...  Kearney.....................  NE...........  68848...........  All Natural Limousin Beef......................................................  ...........
Brown's Best Foods.................  Lincoln.....................  NE...........  68524...........  Beans; whole, dried, instant powdered, quick cooking flak......................        3,877
Excalibur Sires....................  Rochester...................  NE...........  59906...........  Bovine Genetics................................................................        2,350
Heartland Beef Sales, Inc..........  Omaha.......................  NE...........  68106...........  Beef w/peppers and onions, Portioned sliced beef, poultry......................       27,963
Morrison Farms.....................  Clearwater..................  NE...........  68726...........  microwave popcorn..............................................................       20,377
Biosan Laboratories, Inc...........  Derry.......................  NH...........  03038...........  Health/Diet....................................................................       24,675
Seawise, Inc.......................  Portsmouth..................  NH...........  03801...........  Conch, Sea Cucumber............................................................        2,705
American Standard Products, Inc....  Hasbrouck Heights...........  NJ...........  07604...........  Shrimp Feed....................................................................       16,126
Goody, Inc.........................  East Brunswick..............  NJ...........  08816...........  pretzels.......................................................................      400,001
International American Supermarkets  Piscataway..................  NJ...........  08854...........  Processed Sweet Corn, Bakery, snacks, vegetables...............................      474,615
Jersey Asparagus Farms, lnc........  Pittsgove...................  NJ...........  08318...........  Asparagus Seed & Crowns........................................................        4,398
Kwik Enterprises...................  Oakhurst....................  NJ...........  07753...........  Snack Food.....................................................................       20,207
Lucille Farms......................  Montville...................  NJ...........  07045...........  Cheese.........................................................................  ...........
Sovereign Trading Company..........  Englishtown.................  NJ...........  07726...........  cereal, fruit, juice, pet food, vegetables.....................................  ...........
Trinidad Benham Co.................  Carlstadt...................  NJ...........  07072...........  Corn Oil.......................................................................  ...........
TRT International..................  Elizabeth...................  NJ...........  07201...........  mayonnaise.....................................................................       50,000
Wakefern Food Corporation..........  Edison......................  NJ...........  08837...........  Fruit, Vegetables, Dairy, Juice, Cereal, Snack Food............................          662
World Finer Foods,lnc..............  Bloomfleld..................  NJ...........  07003...........  TexMex, Condiment, Veggies, Pet Food, Bakery, Health/Diet......................      199,126
Blue Sky Natural Beverage Co.......  Santa Fe....................  NM...........  87501...........  Beverages......................................................................        2,947
Impact Confections, Inc............  Roswell.....................  NM...........  88202...........  Lollipops; various shapes and sizes............................................        3,069
J-K Products International.........  Albuquerque.................  NM...........  87192...........  processed products.............................................................       16,348
Stahmann Farms, Inc................  San Miguel..................  NM...........  88058...........  pecan nuts.....................................................................        4,533
Alle Processing Corporation........  Maspeth.....................  NY...........  11378...........  cooked corned beef, pastrami, knockwurst, kosher hot dogs......................  ...........
Amal Meat Corp.....................  Jamaica.....................  NY...........  11432...........  grocery products/condiments....................................................       50,000
Baldwin Vineyards..................  Pine Bush...................  NY...........  12566...........  Wine...........................................................................        5,710
Calico Cottage Candies,lnc.........  Mineola.....................  NY...........  11501...........  Dry Fudge Candy Mix............................................................       14,175
Dr. Konstantin Frank...............  Hammondsport................  NY...........  14840...........  Wine...........................................................................  ...........
Export Trade Of America............  New York....................  NY...........  10003...........  Canned Vegetables..............................................................      137,035
Global Beverage Company............  Rochester...................  NY...........  14625...........  beverages......................................................................  ...........
Global Export Marketing Company....  New York....................  NY...........  10001...........  TexMex, Salad Dressing, condiments, Vegetable..................................       88,453
Hansmann's Mills, Inc..............  Bainbridge..................  NY...........  13733...........  Bakery Products, Condiment.....................................................  ...........
Harry's Premium Snacks.............  Hicksville..................  NY...........  11801...........  potato chips, tortilla chips, pretzels.........................................  ...........
Hunter & Hillsberg.................  Syracuse....................  NY...........  13207...........  maple syrup/candy/cream, wine..................................................       12,500
Interfrost.........................  East Rochester..............  NY...........  14445...........  Frozen Corn....................................................................      165,000
Koy Shack, Inc.....................  Hicksville..................  NY...........  11802...........  dairy products, pudding........................................................       67,913
Lamoreaux Landing Wine Cellars.....  Lodi........................  NY...........  14424...........  Wine...........................................................................        1,723
Leosons Overseas Corp..............  Albany......................  NY...........  12205...........  Vegetables (Can/Frozen), Fruits (Can/Dry/Fresh), Cereals.......................  ...........
Northeast Group....................  Monsley.....................  NY...........  10952...........  grocery products...............................................................  ...........
Ontario International, Inc.........  Syracuse....................  NY...........  13206...........  Fresh Vegetables...............................................................       55,000
Certified Angus Beef...............  Wooster.....................  OH...........  44691...........  Beef...........................................................................       28,644
Kahiki Foods, Inc..................  Columbus....................  OH...........  43213...........  Meals-Entrees..................................................................        2,898
Lean Value Sires...................  New Carlisle................  OH...........  45344...........  Lean Value Sires swine semen...................................................        5,250
Select Sires.......................  Plain City..................  OH...........  43064...........  Frozen Bovine Semen............................................................       13,500
Smith Dairy Product Company........  Orrville....................  OH...........  44667...........  yogurt, ice cream, dairy products..............................................       14,793
Woodbury Vineyards.................  Westlake....................  OH...........  44145...........  Wine...........................................................................  ...........
King B Gourmet Foods...............  Enid........................  OK...........  73702...........  Miscellaneous processed foods..................................................        6,740
Oklahoma Joe's Smokers.............  Stillwater..................  OK...........  74075...........  Sweet & Spicy Seasoning (Dried, Steak Seasoning ( Dry Meat.....................  ...........
Golden Temple Bakery, Inc..........  Eugene......................  OR...........  97402...........  Cereals........................................................................       24,701
Oregon Potato Company..............  Boardman....................  OR...........  97818...........  Potato Flakes..................................................................       13,908
Piazza Pizza.......................  Clackamas...................  OR...........  97015...........  Pizza..........................................................................  ...........
Sabroso Company....................  Medford.....................  OR...........  97501...........  Fruit Juice....................................................................        4,621
Trailblazer Food Products..........  Portland....................  OR...........  97230...........  Chowder, Truffle Cakes, Sauces, Preserves, Syrups Pie Filling..................          300
Western Family Foods, Inc..........  Tigard......................  OR...........  97223...........  grocery products...............................................................       19,578
Wholesome & Heany Foods, Inc.......  Portland....................  OR...........  97214...........  Natural & Health Foods.........................................................       18,652
Yoshida Food Products..............  Portland....................  OR...........  97220...........  Condiments.....................................................................       37,986
Ag-Link International, Inc.........  Tunkhannock.................  PA...........  18657...........  Frozen Bovine Semen & Embryos..................................................        6,800
Anderson Bakery Company............  Lancaster...................  PA...........  17602...........  Pretzels.......................................................................  ...........
Better Baked Foods, Inc............  North East..................  PA...........  16428...........  prepared foods.................................................................  ...........
Chenango Valley Pet Foods..........  Allentown...................  PA...........  18103...........  Pet Food.......................................................................      200,000
Goldenberg Candy Co................  Philadelphia................  PA...........  19140...........  Confectionery..................................................................      147,500
Herr Foods Inc.....................  Nottingham..................  PA...........  19362...........  Snack Food.....................................................................        3,025
Jack And Jill Ice Cream Company....  Bensalem....................  PA...........  19020...........  Ice Cream......................................................................       83,638
JDM Commodities....................  Berwyn......................  PA...........  19312...........  Beer...........................................................................        1,500
North American Pet Products, Inc...  Lancaster...................  PA...........  17603...........  dog foods......................................................................      201,754
S.B. Global Trading Co.............  Flourtown...................  PA...........  19031...........  TexMex, Bakery Products........................................................       57,026
Sire Power, Inc....................  Tunkhannock.................  PA...........  18657...........  Frozen Bovine Semen............................................................        9,000
Snyder's Of Hanover, Inc...........  Hanover.....................  PA...........  17331...........  Snack Food.....................................................................  ...........
Sweet Street Desserts, Inc.........  Reading.....................  PA...........  19605...........  snack foods....................................................................       11,466
York Import & Export, Inc..........  Lancaster...................  PA...........  17603...........  Vanilla Extract................................................................        1,226
Ziegler Brothers, Inc..............  Gardeners...................  PA...........  17324...........  Shrimp, larval, trout, tilapia, salmon and flake feeds.........................        8,670
Sterling Merchandising, Inc........  San Juan....................  PR...........  00922...........  Yogurt, Ice Cream..............................................................  ...........
Tropical Fruit, S.E................  Guayanilla..................  PR...........  00656...........  fresh mangoes..................................................................  ...........
Commodity Specialists Company......  E. Greenwich................  RI...........  02818...........  Scallops.......................................................................        2,205
Deep Sea Fish......................  Wakefield...................  RI...........  02880...........  Seafood........................................................................        4,821
Flynn Fisheries....................  Newport.....................  RI...........  02840...........  Squid, American Eel, Atlantic Mackerel, Atlantic Herring.......................  ...........
SeaFresh USA Inc...................  Narrangansett...............  RI...........  02882...........  Dogfish, Monkfish, Squid, Skate, Northern Shrimp...............................       15,312
International Industries             Spartanburg.................  SC...........  29302...........  Trading Company General Grocery Line...........................................       17,102
 Corporation.
Southland Log Homes, Inc...........  Irmo........................  SC...........  29063...........  Pre-Fab Log Homes..............................................................  ...........
Young Pecan Company................  Florence....................  SC...........  29502...........  Tree Nuts......................................................................       14,147
Hesco, Inc.........................  Watertown...................  SD...........  57201...........  Barley, Soy, and Oat Products..................................................        2,303
Flower City Nurseries..............  Smartt......................  TN...........  37378...........  trees and shrubs...............................................................        3,476
Amy Foods, Inc.....................  Houston.....................  TX...........  77087...........  egg rolls, chicken, seafood....................................................          906
Biotics Research Corporation.......  Stafford....................  TX...........  77477...........  Food Supplement................................................................       20,000
Bodacious Trust DBA Bo Know's BBQ..  Austin......................  TX...........  78750...........  Barbecue; sauce, brisket rub, beans. Seasoning; steak..........................  ...........
Bovine Elite, Inc..................  College Station.............  TX...........  77840...........  Bovine Genetics................................................................        4,078
Chung's Gourmet Foods..............  Houston.....................  TX...........  77004...........  Egg Rolls/Entrees..............................................................  ...........
Collin Street Bakery...............  Corsicana...................  TX...........  75110...........  Bakery Products................................................................       50,000
Gulf Pacific Rice Co., Inc.........  Houston.....................  TX...........  77024...........  long grain milled rice, parboiled milled rice..................................       39,725
Hygeia Dairy Company...............  Harlingen...................  TX...........  78551...........  Dairy Products.................................................................  ...........
International Grocers, Inc.........  Houston.....................  TX...........  77041...........  grocery products...............................................................       32,140
Jardine Foods......................  Buda........................  TX...........  78610...........  Trading Company General Grocery Line...........................................        9,794
Kayla Foods........................  Carrollton..................  TX...........  75006...........  Yogurt, Ice Cream, Sherbet, Sorbet, Italian Ices...............................  ...........
Merrick Petfoods, Inc..............  Hereford....................  TX...........  79045...........  dog food and cat food, dog and cat treats......................................       13,025
Progressive Laboratories, Inc......  Irvine......................  TX...........  75038...........  Vitamins.......................................................................        3,485
Ricos Products.....................  San Antonio.................  TX...........  78204...........  salsa, chips, cheese sauce.....................................................  ...........
Sunday House Foods, Inc............  Fredericksburg..............  TX...........  78624...........  Further processed chicken/turkey...............................................  ...........
Texas Coffe Company................  Beaumont....................  TX...........  77705...........  All purpose seasoning..........................................................        7,448
The El Paso Chile Company..........  EL Paso.....................  TX...........  79901...........  Salsas, spicy dips, Margarita and Bloody Mary Mixes, Mustard...................  ...........
United States Bilateral Trade Co...  Ft. Worth...................  TX...........  76107...........  grocery........................................................................      140,000
Agri-Products, Inc.................  Woods Cross.................  UT...........  84087...........  Steak, Steak Sauce.............................................................       15,000
Clover Club Foods..................  Spanish Fork................  UT...........  84660...........  potato and tortilla chips, asst. snacks........................................  ...........
Cookietree Bakeries................  Salt Lake City..............  UT...........  84123...........  Snack Foods....................................................................       48,983
Gossner Foods, Inc.................  Logan.......................  UT...........  84321...........  grocery products...............................................................  ...........
McFarland's Foods, Inc.............  Riverton....................  UT...........  84065...........  soup base (paste), chicken breast, chicken bacon...............................        6,358
Wilson Products Co.................  Salt Lake City..............  UT...........  84104...........  Premium Southwest Wraps........................................................        7,502
ASB Group International............  Vienna......................  VA...........  22182...........  Snack Food.....................................................................      363,276
Basco..............................  Disputanta..................  VA...........  23842...........  Seafood and Aquaculture........................................................  ...........
Cheaspeak Bay Packing L.L.C........  Newport News................  VA...........  23607...........  Conch, Dogfish, Monkfish.......................................................        6,979
CP Speciality Foods, Inc...........  Portsmouth..................  VA...........  23701...........  Sauces, Condiments, preserves, drink mixes, cheese dip.........................        4,150
International Seafood Distributors.  Hayes.......................  VA...........  23072...........  Sea Scallops, Conch, Monkfsh, Crab, Dogfish, Eels..............................       32,617
New Venture Developmcnt Corp.......  Vienna......................  VA...........  22182...........  yogurt, ice cream..............................................................  ...........
Sweet Mountain Magic...............  Reston......................  VA...........  20194...........  Sorbet Mix, soy based frzn dessert, roasted soynut butter......................          930
Virga's Pizza Crust Of Va, Inc.....  Portsmouth..................  VA...........  23701...........  Miscellaneous processed foods..................................................        4,625
Wanchese Fish Company..............  Hampton.....................  VA...........  23663...........  Scallops.......................................................................        3,124
Ben And Jerry's South..............  Burlington..................  VT...........  05403...........  ice cream, yogurt..............................................................       16,250
Cabot Creamery, Inc................  Cabot.......................  VT...........  05647...........  cheddar cheese.................................................................  ...........
Holstein-Friesian Services, Inc....  Brattleboro.................  VT...........  05302...........  Bovine Genetics................................................................        3,542
Rhino Foods, Inc...................  Burlington..................  VT...........  05401...........  Cheesecake.....................................................................        7,500
Agrisource, Inc....................  Bellevue....................  WA...........  98006...........  vegetables, chips, condiments..................................................        6,202
Airfresh Seafoods..................  Gig Harbor..................  WA...........  98335...........  Salmon, Salmon caviar..........................................................  ...........
Alaska Smokehouse..................  Woodinville.................  WA...........  98072...........  Smoked Salmon..................................................................        6,000
American Country Gourmet, Inc......  Steilacoom..................  WA...........  98388...........  Beef Jerky.....................................................................  ...........
Ames International, Inc............  Federal Way.................  WA...........  98003...........  Nuts & Nut Products............................................................        7,458
Arrowac Fisheries, Inc.............  Seattle.....................  WA...........  98199...........  Squid, Dogfish.................................................................  ...........
Aspen International Export Inc.....  Seattle.....................  WA...........  98101...........  grocery products...............................................................        4,255
Brown & Haley......................  Tacoma......................  WA...........  98401...........  Confectionery, buttercrunch, boxed chocolate...................................       71,126
Cascade Clear Water Co.............  Burlington..................  WA...........  98233...........  beverages......................................................................  ...........
Chukar Cherry Company..............  Prosser.....................  WA...........  99350...........  Cherry & Berry Products........................................................       16,102
Crystal Ocean Seafood, Inc.........  Burlington..................  WA...........  98233...........  dairy products.................................................................  ...........
Da Vinci Gourmet, Ltd..............  Seattle.....................  WA...........  98109...........  seafood........................................................................       51,500
Draper Valley Farms................  Mt. Vernon..................  WA...........  98273...........  Further Processed Chicken Products.............................................  ...........
Dungeness Oyster House.............  Sequim......................  WA...........  98382...........  Clams, Oysters, Geoduck, Dungeness Crab........................................          978
Dutch Delights, Inc................  Othello.....................  WA...........  99344...........  fresh onions...................................................................        8,282
Excel Trade Limited................  Seattle.....................  WA...........  98105...........  Frozen Desserts................................................................       32,993
Firman-Pinkerton Co., Inc..........  Wenatchee...................  WA...........  98807...........  fresh potatoes end onions......................................................          450
Grigg & Sons.......................  Quincy......................  WA...........  98848...........  Washington Fresh Onions........................................................  ...........
International Market Brands........  Kirkland....................  WA...........  98034...........  Canned & Frozen Vegetables/processed chicken...................................      143,798
Interocean Seafoods Company........  Seattle.....................  WA...........  98134...........  frozen, canned & fresh seafood.................................................       14,000
Les Boulangers Associes, Inc (LBA).  Seattle.....................  WA...........  98148...........  thaw, proof & bake serve bakery products.......................................        2,686
Liberty Orchards Co., Inc..........  Cashmere....................  WA...........  98815...........  Snack Foods....................................................................       26,866
Lucks Food Decorating Co...........  Tacoma......................  WA...........  98409...........  processed foods................................................................        2,559
Marinelli Shellfish................  Seattle.....................  WA...........  98189...........  Clams, Oysters, Mussels, Crabmeat, Dungeness Crab..............................        3,730
Molly's Foods, Inc.................  Bellingham..................  WA...........  98225...........  fruits.........................................................................        9,365
Northwest Packing Company..........  Vancouver...................  WA...........  98666...........  Tomato Products, Canned, Cherries, Plums, & Pears..............................       14,501
Peninsula Seafoods, Inc............  Port Angeles................  WA...........  98362...........  Black Cod......................................................................  ...........
Phoenix Marketing..................  Bellevue....................  WA...........  98005...........  Grocery Products Line..........................................................       31,140
Roman Meal Company.................  Tacoma......................  WA...........  98409...........  Grain Products.................................................................       55,276
Seattle Chocolate Co...............  Seattle.....................  WA...........  98134...........  Chocolate Truffles, Chocolate bars.............................................            0
Squamish Seafoods..................  Squamish....................  WA...........  98392...........  Clams, Oysters, Geoduck, Dungeness Crab........................................        2,180
Staton Hills.......................  Wapato......................  WA...........  98951...........  Wine...........................................................................        1,364
Stockpot Soups.....................  Redmond.....................  WA...........  98052...........  soup...........................................................................        4,529
Vanguard Trading Services, Inc.....  Issaquah....................  WA...........  98027...........  grocery products...............................................................       36,176
21St Century Genetics..............  Shawano.....................  WI...........  54166...........  Frozen Bovine Semen............................................................       26,000
ABS International..................  DeForest....................  WI...........  53532...........  Bovine Genetics................................................................       36,876
Allied Processors, Inc.............  Boyceville..................  WI...........  54725...........  Food Ingredients...............................................................  ...........
Beehive Botanicals.................  Hayward.....................  WI...........  54843...........  Propolis Tincture; Propolis Throat Spray, Gourmet Honey........................        3,601
Cedar Crest Ice Cream..............  Cedarburg...................  WI...........  54220...........  Ice Cream, Reduced Fat Ice Cream...............................................        1,274
Century Foods International........  Sparta......................  WI...........  54656...........  Dairy Products.................................................................  ...........
Cher-Make Sausage Co...............  Manitowoc...................  WI...........  54220...........  Kippered Teriyaki Beef, Mozzarella & Beef Stick................................        1,149
Cumberland Packing Corporation.....  Racine......................  WI...........  53403...........  Dairy Conc.....................................................................       40,843
Gardetto's.........................  Milwaukee...................  WI...........  53221...........  Pretzels, Snak-ens.............................................................       14,791
Honey Acres Inc....................  Ashippun....................  WI...........  53003...........  Fruit Flavored Honey Creme Spreads, Honeybears.................................        l,139
Hsu's Ginseng Enterprises, Inc.....  Wausau......................  WI...........  54402...........  ginseng/roots, slices, tea, capsules...........................................      140,002
Jones Dairy Farm...................  Fort Atkinson...............  WI...........  53538...........  Pork sausage, bacon, hams......................................................       30,000
Kaytee Products, Inc...............  Chilton.....................  WI...........  53014...........  Pet food.......................................................................       21,488
Merrick's, Inc.....................  Middleton...................  WI...........  53562...........  animal plasma, milk replacements...............................................       10,038
New Generations Dairy Cattle.......  Brooklyn....................  WI...........  53521...........  Bovine Semen...................................................................        9,292
Nueske's Hillcrest Farms Meats.....  Wittenberg..................  WI...........  54499...........  Smoked Pork Products...........................................................          497
Old Fashioned Foods, Inc...........  Mayville....................  WI...........  53050...........  Cheese Sauces & Salsas.........................................................       39,607
SHK Foods, Inc.....................  Fitchburg...................  WI...........  53711...........  Fully Cooked Bacon.............................................................  ...........
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                                                              1998 BRAND COMPANIES BY STATE
 
--------------------------------------------------------------------------------------------------------------------------------------------------------
            Company                      City            State       Zip                            Promoted--Produce                          Expenses
--------------------------------------------------------------------------------------------------------------------------------------------------------
Franciscan Vineyards..........  Rutherford............  CA.....  94573.....  wine..........................................................      $27,500
Frontier Trading..............  San Diego.............  CA.....  92106.....  grocery products..............................................        5,000
Geyser Peak...................  Geyserville...........  CA.....  95441.....  wine..........................................................       30,000
Global Merchandising Corp.....  San Francisco.........  CA.....  94124.....  Spices, cookies, peanuts......................................       15,000
Golden State Vintners.........  Cutler................  CA.....  93615.....  wine..........................................................      155,000
Golden West huts, Inc.........  Ripon.................  CA.....  95366.....  Almonds.......................................................       95,000
Great Crescent International    Rolling Hills Est.....  CA.....  90274.....  crackers, cookies.............................................       30,000
 Inc.
Green Foods Corporation.......  Oxnard................  CA.....  93030.....  Barley pet and nutritional supplement.........................        5,000
Hard-Shelled Int'l............  Long Beach............  CA.....  90813.....  Spiny Lobster.................................................       30,700
Helrazor, Inc.................  Saratoga..............  CA.....  95070.....  Condiments....................................................       15,000
Herman Goelitz, Inc...........  Fairfield.............  CA.....  94533.....  Confectionery.................................................      322,500
Hughson Nut Marketing, Inc....  Hughson...............  CA.....  95326.....  Almonds.......................................................       20,000
H.A. Williams International...  Richmond..............  CA.....  94804.....  Cookies and biscuits..........................................        5,000
Imagine Foods, Inc............  Palo Alto.............  CA.....  94306.....  ice cream, puddings, beverage.................................       25,000
INI International.............  Richmond..............  CA.....  94804.....  Pasta, oils, sauces, condiments etc...........................       20,000
Internationai Commodity         Sonoma................  CA.....  95476.....  Processed, deli meats.........................................       10,000
 Consultants, Inc.
Jewel Date Company............  Palm Desert...........  CA.....  92260.....  processed products............................................       25,000
Joseph Gallo Farms............  Atwater...............  CA.....  95301.....  Cheeses/Dairy Products........................................       10,000
Kashi Company.................  La Jolla..............  CA.....  92038.....  Cereals.......................................................       10,000
Kautz Ironstone Vineyards.....  Murphys...............  CA.....  95247.....  wine..........................................................       67,000
Kenwood Vineyards.............  Kenwood...............  CA.....  95452.....  Wine..........................................................       16,000
Laurel Glen Vineyard..........  Glen Ellen............  CA.....  95442.....  wine..........................................................        5,000
Les Vins de' Amour............  Huntington Beach......  CA.....  92647.....  Juices, wine, cookies, canned fruit, soft drinks..............       10,000
Lion Enterprises..............  Fresno................  CA.....  93702.....  raisins.......................................................       37,500
Louis M. Martini Winery.......  St. Helena............  CA.....  94574.....  California Wine...............................................       15,000
Lundberg Family Farms.........  Richvale..............  CA.....  95974.....  Rice products.................................................       15,000
Mashuga Nuts, Inc.............  San Rafael............  CA.....  94903.....  Nut & Cookies.................................................       18,000
Mayacamas Fine Foods, Inc.....  Sonoma................  CA.....  95476.....  Pastas, Soups, Sauces.........................................        5,000
Merryvale Vineyards...........  St. Helena............  CA.....  94574.....  wine..........................................................       55,000
Mooney Farms..................  Chico.................  CA.....  95973.....  sun dried tomato pesto, tomatoes, kiwi fruit..................       45,000
Mrs. Leeper's, Inc............  San Diego.............  CA.....  92127.....  Pasta.........................................................       15,000
Nancy's Specialty Foods.......  Newark................  CA.....  94560.....  quiche........................................................       15,000
National Raisin Co............  Fowler................  CA.....  93625.....  raisins.......................................................       37,500
Newton Vineyard...............  St. Helena............  CA.....  94574.....  wine..........................................................        8,200
Oceanica Trade S Investment,    Redondo Beach.........  CA.....  90277.....  seafood products..............................................       10,000
 Inc.
Organic Ingredients, Inc......  Aptos.................  CA.....  95003.....  ..............................................................       10,000
Otis McAllister Inc...........  San Francisco.........  CA.....  94111.....  Fruit Juices..................................................       25,000
Pacific Grain Products, Inc...  Woodland..............  CA.....  95776.....  Various flavored Chips and Crackers, Industrial Snacks........       20,000
Pacific Micro-Brews             Walnut Creek..........  CA.....  94595.....  Microbrewed ales..............................................        5,000
 Distributing, Inc.
Paramount Farms...............  Bakersfield...........  CA.....  93380.....  Pistachios....................................................       50,000
Prince Of Peace Enterprises,    San Francisco.........  CA.....  94124.....  Beverages.....................................................      150,000
 Inc.
Purepak, Inc..................  Oxnard................  CA.....  93032.....  Sliced strawberries, organic; sorbet, soups, strawberries.....       65,000
Quady Winery..................  Madera................  CA.....  93639.....  wine..........................................................       11,000
Renaissance Vineyard & Winery,  Renaissance...........  CA.....  95962.....  wine..........................................................       10,000
 Inc.
Roma Exporting Company, Inc...  San Diego.............  CA.....  92101.....  Italian products, oil, cold-cuts, sauces, pasta...............        5,000
Round Hill Winery.............  St. Helena............  CA.....  94574.....  wine..........................................................       16,000
Royal Pacific Foods...........  Pleasanton............  CA.....  94566.....  grocery products line.........................................       10,000
Rutherford Benchmarks, Inc....  St. Helena............  CA.....  94574.....  wine..........................................................       10,000
R.H. Phillips'................  ......................  CA.....  95627.....  Wine..........................................................       10,000
R.W. Garcia Co., Inc..........  San Jose..............  CA.....  95112.....  Salad Eatos-Flavored Chip Strips, Dips and Salsas, Tortillas..       10,000
Sahara Natural Foods, Inc.....  San Leandro...........  CA.....  94577.....  Soup, salad mixes, seasonings, rice, dips.....................       25,000
Sato Agricultural Trading       Fresno................  CA.....  93710.....  Fresh fruits..................................................        5,000
 Company.
Schug Carneros Estate Winery..  Sonoma................  CA.....  95476.....  wine..........................................................       19,000
Sea And Farmfresh Importing     Alhambra..............  CA.....  91803.....  seafood.......................................................       56,000
 Company.
Sequoia Grove Vineyards.......  Napa..................  CA.....  94558.....  wine..........................................................        2,000
Shafer Vineyards..............  Napa..................  CA.....  94558.....  wine..........................................................        2,000
Shoei Foods USA...............  Marysville............  CA.....  95901.....  Dried fruit & nuts............................................       48,000
Smith-Anderson Enterprises,     Huntington Park.......  CA.....  90255.....  California Wine...............................................       25,000
 Inc.
Soltec Corporation............  San Fernando..........  CA.....  91341.....  Cookies, candies, juices, condiments, sauces, cakes, vege.....        5,000
Sonoma Creek Winery...........  Sonoma................  CA.....  95476.....  wine..........................................................        2,000
Spring Mountain Vineyard......  St. Helena............  CA.....  94574.....  wine..........................................................        7,500
Spring Tree Food Corporation..  Oakdale...............  CA.....  95361.....  Nuts..........................................................       15,000
State Fish Company, Inc.......  San Pedro.............  CA.....  90731.....  seafood.......................................................       15,000
St. George Spirits............  Oakland...............  CA.....  94618.....  Brandies, dessert wines, grappa...............................       10,000
Summerfield Foods, Inc........  Santa Rosa............  CA.....  95401.....  Fat Free Soup, Refried beans, Chili Cookies; `Car','C.........       15,000
Sun Maid......................  Kingsburg.............  CA.....  93631.....  California Raisins............................................      150,000
Sunkist Growers...............  Sherman Oaks..........  CA.....  91423.....  Fresh Citrus..................................................    2,531,247
Sunsweet Growers, Inc.........  Pleasanton............  CA.....  94566.....  Prunes........................................................      641,000
The California Winery.........  Ceres.................  CA.....  95307.....  wine..........................................................       49,000
Traditional Medicinals Inc....  Sebastopol............  CA.....  95472.....  Natural & Health Foods........................................        5,000
Trans USA Corporation.........  Richmond..............  CA.....  94806.....  Vegetables, fruits, condiments................................       20,000
Tri-Valley Growers............  San Ramon.............  CA.....  94583.....  Canned Vegetables, Popcorn....................................      206,000
Turlock Fruit Company, Inc....  Turlock...............  CA.....  95381.....  Melons........................................................        5,000
Valley Fig Growers............  Pleasanton............  CA.....  94588.....  Dried Fruit...................................................       30,000
Ventana Vineyards.............  Monterey..............  CA.....  93940.....  wine..........................................................        7,500
Very Special Chocolates, Inc..  Azusa.................  CA.....  91702.....  Candy.........................................................       91,000
Well-Pict, Inc................  Watsonville...........  CA.....  95076.....  Fresh Fruit...................................................       30,000
Wente Vineyards...............  Livermore.............  CA.....  94550.....  Owine.........................................................      250,000
Western Bagel Baking..........  Van Nuys..............  CA.....  91405.....  Bagels........................................................        5,000
Wild Rice Exchange............  Yuba City.............  CA.....  95993.....  rice..........................................................       35,000
Will-Pak Foods, Inc...........  Harbor City...........  CA.....  90710.....  Instant side dishes, soups, chili, beans......................        5,000
Wines Of America, Ltd.........  Larkspur..............  CA.....  94939.....  Wine..........................................................       15,000
Worldwide Sires, Inc..........  Hanford...............  CA.....  93230.....  Frozen Bovine Semen...........................................       47,000
ZB Industries, Inc............  San Pedro.............  CA.....  90733.....  Frozen Seafood Entrees, Frozen Stir-Fry Vegetables............       15,000
Colorado Came Tradin..........  Winter Park...........  CO.....  80482.....  Beef cattle, semen and embryos................................        4,000
Great Western Tortilla Co.....  Denver................  CO.....  80216.....  salsas, tortilla chips........................................       15,000
Lee Enterprises...............  Denver................  CO.....  80222.....  Beef..........................................................       12,000
My Favorite Jerky LLC.........  Boulder...............  CO.....  80302.....  Meat snacks...................................................        3,000
Rocky Mountain Chocolate        Durango...............  CO.....  81301.....  Chocolate and non chocolate confectionery.....................       26,000
 Factory.
Vancol Industries, Inc........  Denver................  CO.....  80229.....  Carbonated soft drinks, flavored water........................       25,000
Western Export Services, Inc..  Denver................  CO.....  80202.....  grocery products, malt beverage, Beer.........................        2,000
American Popcorn Corp.........  Greenwich.............  CT.....  06830.....  Salted, Cheese, Caramel, Chocolate, Fruit Popcorn.............       15,000
Amoona Inc....................  Milford...............  CT.....  06460.....  Prepared Foods................................................       50,000
International Marketing         Shelton...............  CT.....  06484.....  grocery products..............................................  ...........
 Systems, Ltd.
Newman's Own Inc..............  Westport..............  CT.....  06880.....  salad dressing................................................       45,000
Donovan Brown & Associates....  Lakeland..............  FL.....  33801.....  Fruit Juices..................................................       22,500
Edimar International..........  Miami.................  FL.....  33175.....  Condiments, Sauces, Pastas, Peanut Butter.....................       10,000
Imperial Packers and            Hialeah...............  FL.....  33010.....  Lugareno Superior Spanish Sausages............................        4,500
 Purveyors, Inc.
Perky's Food Service Concepts,  Tampa.................  FL.....  33610.....  Dough, refrigerated dry mixes, Pizza products.................        7,000
 Inc.
Allied Foods, Inc.............  Atlanta...............  GA.....  30318.....  Pet foods.....................................................       10,000
American Tanning & Leather      Griffen...............  GA.....  30223.....  Alligator Hides...............................................       12,000
 Company.
Coffees of Hawaii, Inc........  Kualapuu..............  Hl.....  96757.....  Coffee........................................................       15,000
Equipment Team Hawaii.........  Honolulu..............  HI.....  96820.....  fruit.........................................................        5,000
French Gourmet Inc............  Honolulu..............  HI.....  96813.....  Bakery Products...............................................      105,000
Hawaiian Host, Inc............  Honolulu..............  HI.....  96817.....  Chocolate Covered Macnuts and Other Related Products..........       44,000
Hawaiian Sun Products.........  Honolulu..............  HI.....  96819.....  Nut and Fruit Products........................................       25,000
Naturipe Berry Growers, Inc...  Pahoa.................  HI.....  96778.....  Frozen Fruits.................................................       25,000
American Pop Corn Company.....  Sioux City............  IA.....  51102.....  popcorn.......................................................       13,000
American Protein Corporation..  Ames..................  IA.....  50010.....  Porcine/Bov. Immunoglobulin, Plasma & Alb.....................        9,000
Ampc, Inc.....................  Ames..................  IA.....  50010.....  80 percent WPC................................................        7,000
Burke Corporation.............  Nevada................  IA.....  50201.....  Beef/Pork Protein.............................................        2,000
Devansoy Farms, Inc...........  Carroll...............  IA.....  51401.....  Soy products..................................................        3,000
Diamond V Mills, Inc..........  Cedar Rapids..........  IA.....  52407.....  Feed..........................................................        8,000
Maplehurst Genetics...........  Keota.................  IA.....  52248.....  Frozen Bovine Semen...........................................        3,000
Midamar Corporation...........  Cedar Rapids..........  IA.....  52406.....  poultry, processed meats......................................        7,000
Midwestern Soybean              Mason City............  IA.....  50402.....  soybeans (dry, edible)........................................        3,000
 International.
Mrs. Clark's Foods, Inc.......  Ankeny................  IA.....  50211.....  Fruit drink concentrate, juices, salad dressing, condiments...        3,000
Natural Products, Inc.........  Grinnell..............  IA.....  50112.....  Soy protein products, bakery ingredients, humanitarian........        6,000
Nutra-Flo Company.............  Soiux City............  IA.....  51106.....  Dry animal protein feed ingredient............................        7,000
Sioux Honey Association.......  Sioux City............  IA.....  51101.....  Honey.........................................................       49,000
Triple F. Inc.................  Des Moines............  IA.....  50322.....  Animal Feed Additives.........................................        1,000
Idaho Pacific Corporation.....  Ririe.................  ID.....  83443.....  Seasoned & regular Potato Granules, Potato Flakes.............       25,000
Idahoan Foods.................  Lewisville............  ID.....  83431.....  potatoe products..............................................       20,000
Magic Miles Ud., Inc..........  Nampa.................  ID.....  83651.....  Potato flakes.................................................       39,000
Universal Frozen Foods........  Boise.................  ID.....  83706.....  Frozen Potato Products........................................        8,500
American Food Service, U.S.A..  Chicago...............  IL.....  60626.....  Spray oils, snack cakes, peanut bars, baking mixes, etc.......        4,000
Andrew Glueck.................  Chicago...............  IL.....  60614.....  Popcorn, microwave, popping...................................        2,000
Berner Cheese Company.........  Dakota................  IL.....  61018.....  Aerosol Cheese Sauce, Cheese Sauce, Cheese Topping............        5,000
Clarkson Grain Co., Inc.......  Cerro Gordo...........  IL.....  61818.....  Food grade soybeans...........................................        6,000
Distributors International Ltd  Batavia...............  IL.....  60510.....  Assorted crackers, baking mixes, breakfast cereals etc........        6,000
Eli's Chicago's Finest          Chicago...............  IL.....  60634.....  Baked Cheese Cake.............................................        3,000
 Cheasecake.
Essen Nutrition Corp..........  Romeoville............  IL.....  60446.....  sauces, syrup, mixes, salad dressings, mayonnaise.............        2,000
Ferrara Pan Candy Company.....  Forest Park...........  IL.....  60130.....  Confectionery.................................................       10,000
Foulds, Inc...................  Libertyville..........  IL.....  60048.....  macaroni and cheese mix.......................................        3,000
Global Marketing Ltd..........  Niles.................  IL.....  60714.....  Organic plant extract fertilizers.............................        8,000
L P International.............  Chicago...............  IL.....  60632.....  BBQ Sauce, Cheese Dips, Taco Sauce, Flour Tortillas etc.......        7,000
Land O'Frost..................  Lansing...............  IL.....  60438.....  processed poultry, meats, entree meals........................        4,000
Little Lady Foods, Inc........  Elk Grove Village.....  IL.....  60007.....  French Bread Pizza, pizza products............................        3,000
Milk Specialities Co..........  Dundee................  IL.....  60118.....  Feed supplements for dairy cows...............................        4,000
Roney-Oatman..................  Aurora................  IL.....  60506.....  ice cream, frozen shakes......................................        1,000
Sahagian & Associates, Inc....  Oak Park..............  IL.....  60302.....  Corn Sticks & popcorn kernels.................................        7,000
TKI Foods, Inc................  Springfield...........  IL.....  62708.....  Meal Replacement..............................................        7,000
Vienna Sausage Manufacturing    Chicago...............  IL.....  60647.....  Value added meats.............................................        3,000
 Co.
Jones Popcorninc.DBA Clark      New Albany............  IN.....  47150.....  Popcorn, microwave and unpopped...............................        1,000
 Snack.
Midwestern Pet Foods, Inc.....  Evansville............  IN.....  47711.....  pet food (cat, dog)...........................................        7,000
B & H General Supply..........  Leawood...............  KS.....  66211.....  Beans, Honey, Sauce, Salad Dressing, Mustard etc..............        1,000
Pines International...........  Lawrence..............  KS.....  66044.....  Wheat Powder, tabs............................................        6,000
Thompson's Pet Pasta Products.  Kansas City...........  KS.....  66105.....  Pet food......................................................        4,000
Korbel Brands.................  Louisville............  KY.....  40201.....  Wine/Brandy...................................................       50,000
Chef Paul Prudhomme's Magic     Harahan...............  LA.....  70183.....  Sauces and Spices.............................................        5,000
 Seasoning Bl.
Crystal International           New Orleans...........  LA.....  70119.....  Trading Company General Grocery Line..........................      270,000
 Corporation.
J.T. Gibbons..................  New Orleans...........  LA.....  70150.....  Trading Company General Grocery Line..........................       50,000
KSM Seafood Corporation.......  Baton Rouge...........  LA.....  70821.....  Seafood end Aquaculture.......................................       25,000
Annie's Homegrown, Inc........  Chelsea...............  MA.....  02150.....  Macaroni/Cheese Dinners.......................................       20,000
Boston Beer Company...........  Boston................  MA.....  02130.....  Beer..........................................................       15,000
Cape Cod Potato Chip Co.......  Hyannis...............  MA.....  02601.....  SNKSL, Potato Chips...........................................       14,400
Decas Cranberry Sales, Inc....  Wareham...............  MA.....  02571.....  fresh/frozen cranberries......................................       50,000
East Coast Seafood, Inc.......  Lynn..................  MA.....  01903.....  American Lobster, Skate, Monkfish, & Dogfish..................      171,000
New England Natural Bakers,     South Deerfield.......  MA.....  01373.....  Trail Mix, Dried Fruit, Nut Mix, Granola......................        9,000
 Inc.
Ocean Spray International, Inc  Lakeville-Middleboro..  MA.....  02349.....  Cranberry Products............................................      336,604
U.S. Mills, Inc...............  Needham...............  MA.....  02194.....  Cereal........................................................        3,000
Welch Foods Inc., A             Concord...............  MA.....  01742.....  Welch's 100 percent Grape Juices..............................       10,000
 Cooperative.
Welch Foods, Inc..............  Concord...............  MA.....  01742.....  Welch's Fruit Drinks, Fruit Juices............................      695,391
John T. Handy Company.........  Chrisfield............  MD.....  21817.....  Seafood end Aquaculture.......................................       30,000
Maine Potato Growers, Inc.....  Presque Isle..........  ME.....  07469.....  Seed and Table Potatoes.......................................        5,000
American Health and Nutrition,  Ann Arbor.............  MI.....  48108.....  Beans, buckwheat, wheat, sunflower seeds, rye, barley etc.....        3,000
 Inc.
Cherrex Corporation...........  Okemos................  MI.....  48864.....  Frozen Cherries, Cherry Concentrate...........................        2,000
Graceland Fruit Cooperative,    Frankfort.............  MI.....  49635.....  dried carrot, peach, apple, blueberry, cherry, cranberry......        6,000
 Inc.
Honee Bear Canning............  Lawton................  MI.....  49065.....  Canned Cherries (Pitted Red Tart, Dark Sweet).................        2,000
House of Flavors Inc..........  Ludington.............  MI.....  49431.....  Ice cream.....................................................        2,000
Kalsec Inc....................  Kalamazoo.............  MI.....  49005.....  extractives of paprika, hops and capsicum.....................        2,000
Purity Foods International....  Okemos................  MI.....  48864.....  Microwave Popcorn.............................................        1,000
SunRich, Inc..................  Hope..................  MI.....  56046.....  Organic corn sweeteners, soy beverages, seed corn etc.........        6,000
A.G. Beverage Corporation.....  Minneapolis...........  MN.....  55439.....  Soft drink mixes, powder......................................        5,000
Cafe Brenda Foods, Inc........  Minneapolis...........  MN.....  55401.....  Cous Cous Vegetable, Buckwheat Potato, Wild Pecan Rice........        2,000
Cerveza Caliente Brewing        St. Paul..............  MN.....  55104.....  Beer..........................................................        1,000
 Company.
Dahigren & Company, Inc.......  Crookston.............  MN.....  56716.....  Dairy Products................................................        4,000
Davisco Foods International,    Le Sueur..............  MN.....  56058.....  Whey Protein concentrate WPC, Refined Edible Lactose..........        6,000
 Inc.
Knight Seed Company...........  Burnsville............  MN.....  55337.....  Dry edible beans, bird and small animal feed..................        3,000
Lamex Foods, Inc..............  Edina.................  MN.....  55435.....  chicken broth.................................................       40,000
Link Industries...............  Minong................  MN.....  54859.....  kippered beef regular flavor, and black pepper................        4,000
Northland Organics Food         St. Paul..............  MN.....  55102.....  Dairy feed, rice, prepared foods, soybean and grains..........        6,000
 Corporation.
Quality Ingredients             Burnsville............  MN.....  55306.....  Instant cappuccino, whip topping powder, non-dairy creamer....        5,000
 Corporation.
Ryt-Way Food Products.........  Northfield............  MN.....  55057.....  Microwave popcorn.............................................        1,000
Sigco Sun Products, Inc.......  Breckenridge..........  MN.....  56520.....  Sunflower Inshell.............................................        4,000
Sno Pac Foods.................  Caledonia.............  MN.....  55921.....  Frozen fruits and vegetables..................................        2,000
Zinpro Corporation............  Eden Prairie..........  MN.....  55944.....  Roasted Corn, Beans, Margarita Mix, Vinegars, Marinade........        7,000
Accelerated Genetics..........  Colombia..............  MO.....  65205.....  US animal breeders............................................       11,800
Farmland Industries, Inc......  Kansas City...........  MO.....  64116.....  Pet Foods.....................................................        2,000
Gastineau Log Homes, Inc......  New Bloomfield........  MO.....  65063.....  Log homes (wood)..............................................        1,000
Hammons Products Company......  Stockton..............  MO.....  65785.....  Shelled black walnuts, nutmeats...............................        3,000
HS Trading Co.................  Manchester............  MO.....  63021.....  Bagels, specialty cookie......................................       53,000
International Dehydrated        Springfield...........  MO.....  65809.....  Shelf stable broth, liquid fat, powdered meat, broth, fat.....        3,000
 Foods, Inc.
International Ingredient        St. Louis.............  MO.....  63116.....  feed ingredients..............................................        7,000
 Corporation.
John Volpi & Company, Inc.....  St. Louis.............  MO.....  63110.....  Traditional Italian Prosciutto and Rotola.....................       12,000
Lochhead Vanilla Company LLC..  St. Louis.............  MO.....  63132.....  Vanilla powder, pure vanilla and other extracts, nutmeg.......        5,000
NeCo Seed Farms, Inc..........  Garden City...........  MO.....  64747.....  Soybeans......................................................        7,000
Par-Way/Tryson Company........  St. Clair.............  MO.....  63077.....  Seasoned oil sprays, soybean oil..............................        6,000
Raskas Foods, Inc.............  Clayton...............  MO.....  63105.....  Cream Cheese..................................................        3,000
RIBUS, Inc....................  St. Louis.............  MO.....  63105.....  Processing aid ingredient for foods...........................        4,000
T.C. Jacoby & Company, Inc....  St. Louis.............  MO.....  63127.....  Cheese and cream cheese.......................................        2,000
Prickly Pear Ranch............  Helena................  MT.....  59601.....  Bovine Genetics...............................................        4,880
Advanced Nutritionals           Maple Grove...........  NC.....  55369.....  Energy Drink Mixes............................................        4,000
 Coporation.
American Sales International..  Charlotte.............  NC.....  28209.....  Shallowford Farms/Popcorn, Carolina's Best Popcorn............        5,000
Beacon Sweets, Inc............  Mooresville...........  NC.....  28115.....  Hard candy & Gummy candy in the shape of watch/footprint......       17,000
Pogue Industries, Inc.........  Raleigh...............  NC.....  27615.....  pasta, popcorn, sauces........................................        2,000
PS International..............  Durham................  NC.....  27713.....  Wheat flour, rice, popcorn, lentils, peas.....................       15,050
Agway Inc.....................  Grandin...............  ND.....  58038.....  Hulled Millet, Confection Sunflower...........................       23,000
Golden Valley Elk Ranch.......  Portland..............  ND.....  58274.....  Elk velvet....................................................        3,000
North American Bison            New Rockford..........  ND.....  58356.....  Bison Meat & Products.........................................        2,000
 Cooperative.
SK Food International.........  Wahpeton..............  ND.....  58074.....  Salty Snacks..................................................        4,000
Specialty Commodities, Inc....  Fargo.................  ND.....  58106.....  Sunflower(in shell), Sunflower kernel.........................        4,000
Excalibur Sires...............  Rochester.............  NE.....  59906.....  Bovine Genetics...............................................        4,000
Heartland Beef Sales, Inc.....  Omaha.................  NE.....  68106.....  Beef w/peppers and onions, Portioned sliced beef, poultry.....        2,000
Mann Hay Co., Inc.............  Gothenburg............  NE.....  69138.....  Dairy feed....................................................        2,000
Morrison Farms................  Clearwater............  NE.....  68726.....  microwave popcorn.............................................        6,000
Nebraska Bean, Inc............  Clearwater............  NE.....  68726.....  Packaged beans and grain products.............................        4,000
Preferred Popcorn L.L.C.......  Chapman...............  NE.....  68827.....  Raw yellow popcorn............................................        5,000
Biosan Laboratories, Inc......  Derry.................  NH.....  03038.....  Health/Diet...................................................       60,000
American Caribbean Business,    Roselle...............  NJ.....  07203.....  Grocery Prods--Veget, Canfr, Fruit, Snkfd, Snkcn, etc.........       12,500
 Inc.
American Snack Exports Co.....  Dayton................  NJ.....  08810.....  Salty Snack Foods, SNKSL......................................       15,000
American Standard Products,     Hasbrouck Heights.....  NJ.....  07604.....  Shrimp Feed...................................................        6,000
 Inc.
Angostura International Ltd...  Cranford..............  NJ.....  07016.....  FRTJU, CONDI-non-alcoholic mixers and sauces..................       24,800
Elbron Holding Co.............  Hackensack............  NJ.....  07606.....  Grocery Prods-Condi, Juice, BkCer, Prodp, Snkpc, etc..........       25,000
Goody, Inc....................  East Brunswick........  NJ.....  08816.....  pretzels......................................................      261,000
Jersey Asparagus Farms, Inc...  Pittsgove.............  NJ.....  08318.....  Asparagus Seed & Crowns.......................................        5,000
Kwik Enterprises..............  Oakhurst..............  NJ.....  07753.....  Snack Food....................................................       25,500
Skaftafell International        Oak Ridge.............  NJ.....  07438.....  Grocery Products..............................................       12,500
 Grocery.
Sovereign Trading Company.....  Englishtown...........  NJ.....  07726.....  cereal, fruit, juice, pet food, vegetables....................       35,000
S & A International...........  Linden................  NJ.....  07036.....  vegetables, condiments, cereals, snacks.......................       80,000
S & R Trading.................  Edison................  NJ.....  08810.....  Grocery Products..............................................       12,500
TRT International.............  Elizabeth.............  NJ.....  07201.....  mayonnaise....................................................       60,000
Blue Sky Natural Beverage Co..  Santa Fe..............  NM.....  87501.....  Beverages.....................................................        5,000
J-K Products International....  Albuquerque...........  NM.....  87192.....  processed products............................................        5,000
Navajo Agricultural Products    Las Cruces............  NM.....  88003.....  Beans, alfalfa pellets........................................        5,000
 Industry.
Stahmann Farms, Inc...........  San Miguel............  NM.....  88058.....  pecan nuts....................................................        5,000
Flavor Consultants............  Las Vegas.............  NV.....  89128.....  Soy proteins..................................................        5,000
Amal Meat Corp................  Jamaica...............  NY.....  11432.....  grocery products/ condiments..................................  ...........
Anthony Road Wine Company.....  Penn Yan..............  NY.....  14527.....  Wine..........................................................        2,000
Arcadian Estate Vineyards.....  Rock Stream...........  NY.....  14878.....  wine..........................................................        1,000
Baldwin Vineyards.............  Pine Bush.............  NY.....  12566.....  Wine..........................................................        7,000
Baycliff Co. Inc..............  New York..............  NY.....  10021.....  PREPF, RICE, prepared foods and rice..........................        6,250
Calico Cottage Candies, Inc...  Mineola...............  NY.....  11501.....  Dry Fudge Candy Mix...........................................        7,500
Camiz International...........  New York..............  NY.....  10001.....  Cd FT, Dairy Prod, Snack Bakery Prod, Condiments..............       80,000
Cayuga Ridge Estate Winery....  Ovid..................  NY.....  14521.....  wine..........................................................        4,000
Curtice Burns Foods...........  Rochester.............  NY.....  14625.....  fruit fillings, frz veg, proc. tomatoes, pop corn snack.......       15,000
Dr. Konstantin Frank..........  Hammondsport..........  NY.....  14840.....  Wine..........................................................        4,000
Export Trade Of America.......  New York..............  NY.....  10003.....  Canned Vegetables.............................................       18,000
Glenora Wine Cellars, Inc.....  Dundee................  NY.....  14837.....  N.Y. Wine.....................................................        2,000
Global Beverage Company.......  Rochester.............  NY.....  14625.....  beverages.....................................................       15,000
Global Export Marketing         New York..............  NY.....  10001.....  TexMex, Salad Dressing, condiments, Vegetable.................       75,000
 Company.
Hansmann's Mills, Inc.........  Bainbridge............  NY.....  13733.....  Bakery Products, Condiment....................................       17,500
Hunt Country Vineyards........  Branchport............  NY.....  14418.....  wine..........................................................        2,000
Hunter & Hillsberg............  Syracuse..............  NY.....  13207.....  maple syrup/candy/cream, wine.................................        9,000
Kozy Shack, Inc...............  Hicksville............  NY.....  11802.....  dairy products, pudding.......................................       60,000
Lakewood Vineyards............  Watkins Glen..........  NY.....  14891.....  wine..........................................................        2,000
Lamoreaux Landing Wine Cellars  Lodi..................  NY.....  14424.....  Wine..........................................................        4,000
Liberty Growers Inc...........  Valatie...............  NY.....  12184.....  mixed fruits promoted in a group, pears, peaches & others.....       50,000
Loriva Supreme Foods Inc......  Ronkonkoma............  NY.....  11779.....  Vegetable Oil.................................................       10,500
Mom 'n Pops...................  New Windsor...........  NY.....  12553.....  Chocolate confectionery.......................................        3,000
New Source Co.................  Brooklyn..............  NY.....  11230.....  Juices, CONDI, BKCER, VEGET, Cn Fruit, SNKPC, CnSfd...........       25,000
Northeast Group...............  Monsley...............  NY.....  10952.....  grocery products..............................................       50,000
Old London Foods..............  Bronx.................  NY.....  10461.....  SNKBK, PROCP..................................................       15,000
Ontario International, Inc....  Syracuse..............  NY.....  13206.....  Fresh Vegetables..............................................       26,000
Romeo's Exotic Juice Inc......  Brooklyn..............  NY.....  11205.....  Other dairy products..........................................       12,500
Unilink Inc./lnterffost Inc...  East Rochester........  NY.....  14445.....  SCORN-nut corn, VEGET, OTVEG, SNKPC--popcorn..................      100,000
Wagner Vineyards..............  Lodi..................  NY.....  14860.....  N.Y. Wine.....................................................        6,000
Candy Flowers, Inc............  Mentor................  OH.....  44060.....  Chocolate and non chocolate confectionery.....................       24,000
Certified Angus Beef..........  Wooster...............  OH.....  44691.....  Beef..........................................................       39,650
Four Comer Trading............  Columbus..............  OH.....  43214.....  Dried soup mixes, dressings, flavored mustards, dried fr......        6,000
Kahiki Foods, Inc.............  Columbus..............  OH.....  43213.....  Meals-Entrees.................................................        4,000
O Neil Foods, Inc.............  Garfield Heights......  OH.....  44125.....  Soy protein concentrate.......................................        2,000
Select Sires..................  Plain City............  OH.....  43064.....  Frozen Bovine Semen...........................................       20,000
Smith Dairy Product Company...  Orrville..............  OH.....  44667.....  yogurt, ice cream, dairy products.............................        4,000
Weaver Meats, Inc.............  Painesville...........  OH.....  44077.....  Snackfoods....................................................        5,000
Agripac, Inc..................  Salem.................  OR.....  97304.....  Vegetables-canned and frozen..................................       30,000
Amos Ranch....................  Camos Valley..........  OR.....  97416.....  Simmental Semen...............................................        1,125
Golden Temple Bakery, Inc.....  Eugene................  OR.....  97402.....  Cereals.......................................................       30,000
Klamath Valley Botanicals, Ltd  Chiloquin.............  OR.....  80231.....  Organic products, juices, algae, cereals......................        5,000
Norpac Foods..................  Lake Oswego...........  OR.....  97035.....  Canned and Frozen Corn........................................       10,000
Oregon Brewing Company, Inc...  Newport...............  OR.....  97365.....  Various beers.................................................        5,000
Oregon Potato Company.........  Boardman..............  OR.....  97818.....  Potato Flakes.................................................       20,000
Piazza Pizza..................  Clackamas.............  OR.....  97015.....  Plzza.........................................................       10,000
Portland Brewing Company......  Portland..............  OR.....  97210.....  Beer..........................................................       25,000
Rossha Enterprises, Inc.......  Keno..................  OR.....  97627.....  Blue-green algae products.....................................       20,000
Turtle Mountain, Inc..........  Junction City.........  OR.....  97448.....  Frozen deserts................................................       14,000
Western Family Foods, Inc.....  Tigard................  OR.....  87223.....  grocery products..............................................       30,000
Ag-Link International, Inc....  Tunkhannock...........  PA.....  18657.....  Frozen Bovine Semen & Embryos.................................        5,417
Amerifood Snacks..............  York..................  PA.....  17404.....  Snack foods...................................................  ...........
Anderson Bakery Company.......  Lancaster.............  PA.....  17602.....  Pretzels......................................................       60,000
Bell Export Foods Group.......  Philadelphia..........  PA.....  19106.....  meat products, soups, cookies.................................       15,000
Chenango Valley Pet Foods.....  Allentown.............  PA.....  18103.....  Pet Food......................................................       75,000
Esporonto Exports Inc.........  Langhorne.............  PA.....  19047.....  YOICE--yogurt and ice cream...................................       50,000
Goldenberg Candy Co...........  Philadelphia..........  PA.....  19140.....  Confectionery.................................................      270,000
International Custom Products   Dubois................  PA.....  15801.....  food ingred's, cheese & othr dairy prods, CONDI, PROCP........       25,000
 Inc.
Jack And Jill Ice Cream         Bensalem..............  PA.....  19020.....  Ice Cream.....................................................       60,000
 Company.
Jeremy's Microbatch Ice Cream.  Philadelphia..........  PA.....  19104.....  ice cream and yogurt--YOICE...................................        5,000
John Lustig Meats Inc.........  Quakertown............  PA.....  18951.....  cold cuts-bologna, salami, rs bf, ht dogs, bf bkfst strip.....       15,000
LDI Inc. Vege Pretzel Co......  Hanover...............  PA.....  17331.....  SNKSL-pretzels................................................       12,500
North American Pet Products,    Lancaster.............  PA.....  17603.....  dog foods.....................................................       60,000
 Inc.
Omega Pet Professionals Inc...  Lithe.................  PA.....  17543.....  PETFD.........................................................       10,000
Premium Grocery Exports.......  Lancaster.............  PA.....  17604.....  Condiments....................................................       50,000
Sire Power, Inc...............  Tunkhannock...........  PA.....  18657.....  Frozen Bovine Semen...........................................        9,000
Sweet Street Desserts, Inc....  Reading...............  PA.....  19605.....  snack foods...................................................       18,500
S.B. Global Trading Co........  Flourtown.............  PA.....  19031.....  TexMex, Bakery Products.......................................       75,000
Ziegler Brothers, Inc.........  Gardeners.............  PA.....  17324.....  Shrimp, larval, trout, tilapia, salmon and flake feeds........       15,000
Deep Sea Fish.................  Wakefieid.............  Rl.....  02880.....  Seafood.......................................................       16,500
SeaFresh USA Inc..............  Narrangansett.........  RI.....  02882.....  Dogfish, Monkfish, Squid, Skate, Northern Shrimp..............        7,800
Young Pecan Company...........  Florence..............  SC.....  29502.....  Tree Nuts.....................................................       10,000
International Brand Services,   Somerville............  TN.....  38068.....  Baked Goods...................................................        5,000
 Inc.
American Fine Wines...........  The Woodlands.........  TX.....  77380.....  wine..........................................................        6,000
Billy Blues Food Corp.........  San Antonio...........  TX.....  78209.....  Sauces and Spices.............................................       25,000
Blue Bell Creameries, L.P.....  Brenham...............  TX.....  77834.....  Ice Cream/Yogurt..............................................        5,000
Bovine Elite, Inc.............  College Station.......  TX.....  77840.....  Bovine Genetics...............................................        4,000
Elgin Breeding Service........  Elgin.................  TX.....  78621.....  US Genetics-Bovine Semen......................................        4,000
H & H Foods...................  Mercedes..............  TX.....  78570.....  Trading Company General Grocery Line..........................        5,000
Jardine Foods.................  Buda..................  TX.....  78610.....  Trading Company General Grocery Line..........................       15,000
Sunday House Foods, Inc.......  Fredericksburg,.......  TX.....  78624.....  Further processed chicken/turkey..............................        5,000
The El Paso Chile Company.....  El Paso...............  TX.....  79901.....  Salsas, spicy dips, Margarita and Bloody Mary Mixes, must.....       94,000
Tri City Sales................  El Paso...............  TX.....  79905.....  Ethnic Foods..................................................       20,000
Bear Creek Country Kitchens,    Heber.................  UT.....  84032.....  Oils-organic..................................................       30,000
 Inc.
Cookietree Bakeries...........  Salt Lake City........  UT.....  84123.....  Snack Foods...................................................      127,000
McFarland's Foods, Inc........  Riverton..............  UT.....  84065.....  soup base (paste), chicken breast, chicken bacon..............       25,000
Norbest.......................  Midvale...............  UT.....  84047.....  Further process turkey and whole turkey.......................       32,500
Parker International, Inc.....  Salt City City........  UT.....  84111.....  Beef Variety Meats............................................       57,500
Tropical Sno..................  Draper................  UT.....  84020.....  Frozen yogurt, Ices, lemonade, syrups.........................        5,000
AMS Genetics..................  Richmond..............  VA.....  23233.....  Angus Embryo Promotion........................................        4,000
ASB Group International.......  Vienna................  VA.....  22182.....  Snack Food....................................................      100,000
Export Dairy Inc..............  Alexandria............  VA.....  22304.....  Various Dairy Products-Butter, Cheese, YOICE, etc.............        7,000
International Seafood           Hayes.................  VA.....  23072.....  Sea Scallops, Conch, Monkfish, Crab, Dogfish, Eels............       28,000
 Distributors.
Annie's Naturals..............  North Calais..........  VT.....  05650.....  Condiments....................................................        5,000
Maple Grove Farms Of Vermont..  St. Johnsbury.........  VT.....  5819......  Bakery, Maple Product, Salad Dressing, Condiment, Sauce.......       12,500
Rhino Foods, Inc..............  Burlington............  VT.....  05401.....  Cheesecake....................................................        5,000
2020 Development Co., LLC.....  Woodinville...........  WA.....  98072.....  Beverages.....................................................       30,000
Alaska Smokehouse.............  Woodinville...........  WA.....  98072.....  Smoked Salmon.................................................       30,000
Ames International, Inc.......  Federal Way...........  WA.....  98003.....  Nuts & Nut Products...........................................       25,000
Aspen International Export Inc  Seattle...............  WA.....  98101.....  grocery products..............................................       15,000
Brown & Haley.................  Tacoma................  WA.....  98401.....  Confectionery, buttercrunch, boxed chocolate..................       70,000
Buckeye Bean & Herbs, Inc.....  Spokane...............  WA.....  99217.....  Pastas, dry soup, bread, sauce mixes..........................       10,000
Capilano Pacific, Inc.........  Spokane...............  WA.....  99217.....  Pasta & dry mixes.............................................       10,000
Cascade Clear Water Co........  Burlington............  WA.....  98233.....  beverages.....................................................       30,000
Chief Wenatchee...............  Wenatchee.............  WA.....  98801.....  Fresh Fruit...................................................        5,000
Chukar Cherry Company.........  Prosser...............  WA.....  99350.....  Cherry & Berry Products.......................................        5,000
DaVinci Gourmet, Ltd..........  Seattle...............  WA.....  98108.....  Mochas, dessert sauces, lattes................................       26,000
Excel Trade Limited...........  Seattle...............  WA.....  98105.....  Frozen Desserts...............................................        5,000
Global Trading Resource.......  Bellevue..............  WA.....  98004.....  Condiments and vegetable oils, flour, turkey..................       10,000
International Market Brands...  Kirkland..............  WA.....  98034.....  Canned & Frozen Vegetables/processed chicken..................       72,000
James Farrell & Company.......  Seattle...............  WA.....  98104.....  Dairy products................................................       32,000
Jana Brands, Inc..............  Bellevue..............  WA.....  98007.....  Fish and squid................................................        5,000
Les Boulangers Associes, Inc.   Seattle...............  WA.....  98148.....  thaw, proof & bake serve bakery products......................       15,000
 (LBA).
Liberty Orchards Co., Inc.....  Cashmere..............  WA.....  98815.....  Snack Foods...................................................       20,000
Lucks Food Decorating Co......  Tacoma................  WA.....  98409.....  processed foods...............................................        5,000
Marinelli Shellfish...........  Seattle...............  WA.....  98189.....  Clams, Oysters, Mussels, Crabmet, Dungeness Crab..............       37,000
Nally's Fine Foods............  Tacoma................  WA.....  98409.....  Snack Foods...................................................       30,000
Northwest Packing Company.....  Vancouver.............  WA.....  98666.....  Tomato Products, Canned, Cherries, Plums, & Pears.............        5,000
Pacific Valley Foods..........  Bellevue..............  WA.....  98005.....  grocery products..............................................       20,000
Pacific-Russia, Inc...........  Woodinville...........  WA.....  98072.....  Canned meats, vegetables, fruit juices, soups etc.............        5,000
ProPak Inc....................  Mattawa...............  WA.....  99349.....  Onions........................................................       15,000
Tree Top, Inc.................  Selah.................  WA.....  98942.....  Fruit Juices, Apple Sauce.....................................       35,000
Vanguard Trading Services, Inc  Issaquah..............  WA.....  98027.....  grocery products..............................................       25,000
Willow Wind Organic Farms.....  Ford..................  WA.....  99013.....  Frozen vegetables.............................................       12,000
ABS International.............  DeForest..............  Wl.....  53532.....  Bovine Genetics...............................................       46,000
Ace Baking Company Ltd........  Green Bay.............  WI.....  54306.....  Baked Goods...................................................        5,000
Beehive Botanicals, Inc.......  Hayward...............  WI.....  54843.....  Honey products................................................        1,000
Butter Buds Food Ingredients..  Racine................  WI.....  53403.....  Dairy Concentrate.............................................        7,000
Century Foods International...  Sparta................  WI.....  54656.....  Dairy Products................................................        1,000
CRI...........................  Shawano...............  WI.....  54166.....  US Genetics-Bovine Semen......................................       18,500
Gardetto's....................  Milwaukee.............  WI.....  53221.....  Pretzels, Snak-ons............................................        8,000
Honey Acres Inc...............  Ashippin..............  WI.....  53003.....  Honeybears, gourmet honey, flavored honey creme spreads.......        7,000
Hsu's Ginseng Enterprises, Inc  Wausau................  WI.....  54402.....  ginseng/roots, slices, tea, capsules..........................        2,000
Jones Dairy Farm..............  Fort Atkinson.........  WI.....  53538.....  Pork sausage, bacon, hams.....................................       50,000
Lactoprot USA, INC............  Blue Mounds...........  WI.....  53517.....  Processed cheese products.....................................        3,000
Merrick's, Inc................  Middleton.............  WI.....  53562.....  animal plasma, milk replacements..............................        7,000
Native Wisconsin Ginseng Coop.  Wausau................  WI.....  54402.....  Wisconsin ginseng products (tea, capsule, honey etc.).........        3,000
NaturalAmerican Ginseng Inc...  Wausau................  WI.....  54401.....  Ginseng products..............................................        5,000
New Generations Dairy Cattle..  Brooklyn..............  WI.....  53521.....  Bovine Semen..................................................       10,000
Old Fashioned Foods, Inc......  Mayville..............  WI.....  53050.....  Cheese Sauses & Salsas........................................        9,000
Palermo's Villa, Inc..........  Milwaukee.............  WI.....  53204.....  Pizza products................................................        1,000
Terra Prima Inc...............  Hudson................  WI.....  54016.....  Corn chips, soybeans..........................................        7,000
WCA Services, Inc.............  Monona................  WI.....  53716.....  Ginseng capsules..............................................        2,000
Wisconsin GinsenglHerb          Marathon..............  WI.....  54448.....  Extract, capsules, aloe-cranberry juice drink.................        2,000
 Association.
World Royale..................  Marathon..............  WI.....  54448.....  Ginseng capsules..............................................        2,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Total Participant allowable budgets of 24 Million, with 15.2M designated by company, with 203K awaiting company address information.

                            overseas offices
    Question. Provide a list of FAS overseas counselor/attache and 
trade offices for fiscal year 1998 and 1999, and proposed for fiscal 
year 2000, and the amount of funding and full-time equivalent staffing 
levels provided for each.
    Answer. A list of FAS overseas counselor/attache and trade offices 
and the amount of funding and full-time equivalent staffing levels is 
provided.
    [The information follows:]

                                             [Dollars in Thousands]
----------------------------------------------------------------------------------------------------------------
                                        Fiscal Year 1998          Fiscal Year 1999          Fiscal Year 2000
                                   -----------------------------------------------------------------------------
   Foreign Agricultural Affairs                    On-Board                  On-Board                  On-Board
                                      Funding      Employ.      Funding      Employ.      Funding      Employ.
----------------------------------------------------------------------------------------------------------------
 
              EUROPE
 
AUSTRIA...........................         $697            4         $712            4         $712            4
BELGIUM, E........................          207            1          218            1          218            1
BELG.USEU.........................        1,185            6        1,298            7        1,298            7
CZECH REP.........................           40            1           40            1           40            l
DENMARK...........................          170            2          183            2          183            2
FRANCE............................          899            7          905            7          905            7
GERMANY...........................          727            6          832            7          832            7
GREECE............................          203            2          220            2          220            2
IRELAND...........................          153            1          150            1          150            1
ISRAEL............................          149            1          143            1          143            1
ITALY, EMB........................          693            6          708            6          708            6
ITALY, FODAG......................          206            1          231            1          231            1
NETHERLANDS.......................          775            4          778            5          778            5
PORTUGAL..........................          147            1          157            2          157            2
SPAIN.............................          788            6          792            6          792            6
SWEDEN............................          347            5          381            5          381            5
SWITZ, BERN.......................           77  ...........           27  ...........           27  ...........
SWITZ, GEN........................          813            4          872            4          872            4
UNITED KINGDOM....................          810            5          780            6          780            6
                                   -----------------------------------------------------------------------------
    TOTAL.........................        9,086           63        9,427           68        9,427           68
                                   =============================================================================
 
        WESTERN HEMISPHERE
 
ARGENTINA.........................          720            5          747            5          747            5
BRAZIL............................          466            4          491            4          491            4
CANADA............................          460            5          458            5          458            5
CHILE.............................          343            3          337            3          337            3
COLOMBIA..........................          390            4          440            4          440            4
COSTA RICA........................          380            3          407            3          407            3
DOM.REP...........................          340            2          380            2          380            2
ECUADOR...........................          165            2          138            2          138            2
GUATEMALA.........................          434            2          521            3          521            3
MEXICO............................          893            8          985            8          985            8
PERU..............................          311            3          327            3          327            3
VENEZUELA.........................          536            5          712            5          712            5
                                   -----------------------------------------------------------------------------
    TOTAL.........................        5,438           46        5,943           47        5,943           47
                                   =============================================================================
              AFRICA
 
ALGERIA...........................           32  ...........           35  ...........           35  ...........
BULGARIA..........................          245            3          220            3          220            3
BANGLADESH........................           40            1           39            1           39            1
COTE D'IVOIRE.....................          377            3          366            3          366            3
EGYPT.............................          438            3          442            3          442            3
INDIA.............................          340            8          365            7          365            8
KENYA.............................          314            1          299            1          299            1
MOROCCO...........................          246            2          250            3          250            3
NIGERIA...........................          370            2          475            2          475            2
PAKISTAN..........................          289            3          301            4          301            3
ROMANIA...........................           32            1           35            1           35            1
SYRIA.............................           52            1           54            1           54            1
SERBIA-MONT.......................           37            1           38            1           38            1
SO.AFRICA.........................          594            5          745            6          745            6
TUNISIA...........................           75            2           77            2           77            2
TURKEY............................          505            4          460            4          460            4
                                   -----------------------------------------------------------------------------
    TOTAL.........................        3,986           40        4,201           42        4,201           42
                                   =============================================================================
               ASIA
 
AUSTRALIA.........................          287            3          323            3          323            3
PRC...............................          936            4          923            4          923            4
INDONESIA.........................          529            5          501            5          501            5
JAPAN.............................         1334           12        1,390           12        1,390           12
KOREA.............................          501            5          528            5          528            5
MALAYSIA..........................          235            3          288            3          288            3
NEW ZEALAND.......................          186            2          201            3          201            3
PHILIPPINES.......................          488            5          475            5          475            5
POLAND............................          489            4          589            4          589            4
RUSSIA............................          900            8          974            8          974            8
THAILAND..........................          516            5          575            5          575            5
UKRAINE...........................          250            2          256            2          256            1
VIETNAM...........................          342            1          347            1          347            1
                                   -----------------------------------------------------------------------------
    TOTAL.........................        6,993           59        7,370           60        7,370           59
                                   =============================================================================
    TOTAL, FAA....................       25,503          208       26,941          217       26,941          216
                                   =============================================================================
    AGRIGULTURAL TRADE OFFICES
SAO PAULO, Brazil.................          522            4          512            4          512            4
SHANGHAI, China...................          634            1          653            1          653            1
GUANGZHOU, China..................          403            1          419            1          419            1
HAMBURG, Germany..................          452            3          460            3          460            1
HONG KONG.........................          997            4        1,017            4        1,017            4
JAKARTA, Indonesia................          179            1          347            1          347            1
MILAN, Italy......................          349            2          345            2          345            1
TOKYO, Japan......................        1,879            6        1,977            6        1,977            6
OSAKA, Japan......................          446            3          476            3          476            3
SEOUL, Korea......................          882            4          915            4          915            4
MEXICO CITY.......................        1,382            5          873            5          873            5
MOSCOW, Russia....................          199            1          217            1          217            1
JEDDAH. Saudi.....................           90            1           93            1  ...........  ...........
RIYADH, Saudi Arabia..............          317            2          313            2          313            2
SINGAPORE.........................          876            3          854            3          854            3
SOUTH AFRICA......................  ...........  ...........  ...........  ...........          370            1
DUBAI, U.A........................          356            4          363            4          363            4
CARIBBEAN BASIN, USA..............          417            3          415            3          415            3
                                   -----------------------------------------------------------------------------
    TOTAL, ATO....................       10,380           48       10,254           48       10,531           44
                                   =============================================================================
      GRAND TOTAL.................       35,883          256       37,195          265       37,472          260
----------------------------------------------------------------------------------------------------------------
\1\ Overseas managed on a head count basis, not PTk basis. Total includes FSN's as well as U.S. Foreign Service
  personnel.


                          INTERNATIONAL COOPERATIVE ADMINISTRATIVE SUPPORT SERVICES \1\
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                                                                     1998 \2\          1999            2000
----------------------------------------------------------------------------------------------------------------
Foreign Agricultural Affairs....................................           7,590           7,902           7,948
Agricultural Trade Offices......................................           3,795           3,952           3,972
                                                                 -----------------------------------------------
    TOTAL.......................................................           11,38          11,854          11,920
----------------------------------------------------------------------------------------------------------------
\1\ Reimbursement to State Department.
\2\ Includes a $4.4 million base transfer.

                        export subsidy programs
    Question. Provide the total amount of bonus awards to U.S. 
exporters under the Export Enhancement Program and the Dairy Export 
Incentive Program for fiscal year 1998 and for fiscal year 1999 to 
date.
    Answer. Bonus awards under the Export Enhancement Program for 
fiscal year 1998 totaled $2,067,500. As of March 16, 1999, fiscal year 
1999 awards totaled $27,762. For fiscal year 1998, Dairy Export 
Incentive Program bonus awards totaled $110,159,692. As of March 16, 
1999, fiscal year 1999 awards totaled $70,450,425.
    Question. What are the maximum volume and spending limits for each 
of these export subsidy programs consistent with U.S. World Trade 
Organization obligations for each of fiscal years 1998, 1999 and 2000?
    Answer. Quantity commitments are based on a July through June year, 
while expenditure commitments are based on an October-September year. 
For the years 1998, 1999 and 2000 maximum subsidies under the Uruguay 
Round Agreement are provided for the record.
    [The information follows:]

                                              MAXIMUM VOLUME AND SPENDING LIMITS FOR EEP AND DEIP PROGRAMS
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Quantity     Budget     Quantity     Budget     Quantity     Budget     Quantity     Budget
                                                           July/June   Oct/Sept    July/June   Oct/Sept    July/June   Oct/Sept    July/June   Oct/Sept
                                                           1997-1998   1997-1998   1998-1999   1998-1999   1999-2000   1999-2000   2000-2001   2000-2001
--------------------------------------------------------------------------------------------------------------------------------------------------------
Wheat...................................................      17,952      $604.8      16,809      $524.5      15,665      $444.2      14,522      $363.8
Feed Grain..............................................       1,768        59.1       1,699        54.8       1,630        50.4       1,561        46.1
Rice....................................................         178        10.4         132         7.7          85         5.0          39         2.4
Veg Oils................................................         409        37.4         320        29.6         231        21.8         141        14.1
Beef....................................................          20        29.2          19        27.1          18        25.0          18        22.8
Pork....................................................        0.45         0.6        0.43         0.6        0.41         0.5         0.4         0.5
Poultry.................................................          32        18.6          30        17.3          29        15.9          28        14.6
Live Cattle (head)......................................      12,490        15.2      12,O01        14.1      11,513        13.0      11,O24        11.9
Eggs (mil doz)..........................................          21         5.2          16         4.0          12         2.8           7         1.6
                                                         -----------------------------------------------------------------------------------------------
    Total EEP...........................................  ..........       780.5  ..........       679.7  ..........       578.6  ..........       477.8
                                                         ===============================================================================================
Butterfat...............................................          34        39.1          30        36.2          25        33.4          21        30.5
Nonfat Dry Milk.........................................          92       105.6          84        97.9          76        90.2          68        82.5
Cheese..................................................           4         4.6           3         4.3           3         4.0           3         3.6
Other Milk Prod.........................................           7         8.6           5         5.8           3         2.9           0         0.0
                                                         -----------------------------------------------------------------------------------------------
    Total DEIP..........................................  ..........         158  ..........         144  ..........         131  ..........         117
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Quantities rounded to nearest 1,000 metric tons unless otherwise noted. Budget in ($mil).

                      ccc export credit guarantees
    Question. Provide a listing of the activities supported under each 
of the four export credit guarantee activities in fiscal year 1998, and 
in fiscal year 1999 to date: Supplier Credit Guarantees, Facilities 
Guarantees, GSM-102, and GSM-103.
    Answer. The attached report provides the requested information for 
the Supplier Credit, GSM-102 and GSM-103 programs. The Facilities 
Guarantees program availability is listed below; however, to date, no 
projects have been guaranteed under this program.
Fiscal Year 1998 Allocations Under the Facilities Guarantee Program
    Caribbean Region.--$20,000,000. Includes: Jamaica and Trinidad and 
Tobago
    Central America Region.--$30,000,000. Includes: Costa Rica, El 
Salvador, Guatemala, and Panama
    Southeast Asia Region.--$40,000,000. Includes: Indonesia, 
Philippines, Malaysia and Thailand
    Mexico.--$50,000,000
    Peru.--$10,000,000
    Russia.--$5,000,000
Fiscal Year 1999 Allocations Under the Facilities Guarantee Program
    Baltic Region.--$10,000,000. Includes: Lithuania, Estonia and 
Latvia.
    East Africa Region.--$10,000,000. Includes: Kenya, Uganda and 
Tanzania.
    Southern Africa Region.--$30,000,000. Includes: Angola, Botswana, 
Burundi, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, 
Rwanda, Seychelles, South Africa, Swaziland, Democratic Republic of the 
Congo (formerly Zaire), Zambia and Zimbabwe.
    Caribbean Region.--$20,000,000. Includes: Jamaica, Trinidad and 
Tobago.
    Central America Region.--$30,000,000. Includes: Costa Rica, El 
Salvador, Guatemala and Panama.
    Southeast Asia Region.--$50,000,000. Includes: Indonesia, 
Philippines, Malaysia and Thailand
    Mexico.--$50,000,000
    Turkey.--$10,000,000
                                 ______
                                 
                  Questions Submitted by Senator Bond
                      foreign agricultural service
    Question. Do you expect USAID to comply in fiscal year 1999 with 
the requirement (7 USC 1724(b)(1)) that 75 percent of non-emergency 
donations be in the form of processed, fortified, or bagged 
commodities? If not, why not and what is USDA doing to assure future 
compliance? In fiscal year 1998, USAID barely reached 50 percent in 
supplying value-added commodities, yet other requirements, such as 
monetization far exceeded requirements (15 percent statutory minimum 
versus nearly 50 percent actual). What steps is USDA taking to restore 
the balance required by law?
    Answer. Based upon the approved level of fiscal year 1999 title II 
non-emergency activities to date, it is expected that 63.6 percent of 
the commodities will either be fortified, processed, or bagged. Part of 
the decline in the use of these value-added commodities is the result 
of an increase in the demand for bulk commodities that are suitable for 
monetization (sale). In addition, there has also been a decline in the 
number of direct feeding programs under title II which have 
traditionally emphasized the use of value-added commodities. USAID has 
been monitoring the decline in the use of value-added commodities and 
has initiated discussions with the cooperating sponsors, domestic 
commodity producer groups, and Congressional staff to emphasize the 
importance of adhering to this mandate. In addition, USAID will issue 
new guidance in the Federal Register explaining the importance of using 
value-added commodities in title II activities, including both direct 
distribution and monetization. It is the goal of USAID over the next 
two years to significantly increase the percentage of value-added 
commodities used in title II non-emergency activities when compared to 
the percentage achieved in fiscal year 1998.
                       ccc section 11 funding cap
    Question. It is our understanding that the limitation placed on CCC 
technical assistance funds is undermining NRCS efforts to provide 
technical assistance. If the Section 11 cap is modified, would that 
help enable greater delivery success?
    Answer. Modifying the Section 11 cap would enable NRCS to continue 
to provide technical assistance for those programs that are funded by 
the Commodity Credit Corporation. Without these funds, NRCS will not be 
able to provide all of the technical assistance that is proposed in the 
fiscal year 2000 budget.
                  staffing reduction impact on mission
    Question. What reduction in force at NRCS does the budget envision 
and how will that impact NRCS mission performance?
    Answer. The NRCS budget indicates a reduction of approximately 
1,055 FTE would be necessary to stay within the amount of technical 
assistance funding. This reduction would come through a combination of 
furloughs, early and optional retirements, buy-outs, and reductions-in-
force. The primary impact of these FTE reductions will occur at the 
field level. The result will be substantial reductions in the level of 
service provided to landowners and landusers in such areas as planning 
assistance, implementation of conservation practices, construction 
projects, resource inventories and reduced levels of implementation for 
some cost share programs.
                    benefits of watershed structure
    Question. Many in our state suspect that OMB has never met a 
structure that they liked and fail to see the multiple benefits of the 
watershed program.
    Answer. The annual benefits of both structural and non-structural 
practices are easily defended. Though NRCS assists project sponsors in 
the consideration of a wide array of alternatives, including 
structural, non-structural, land treatment and floodplain easements, 
there are many situations in which the use of structural measures are 
the only solution to address the problem.
    The benefits of the existing flood projection projects became 
abundantly apparent during recent flooding events in Texas. In the fall 
of 1998, a band of severe thunderstorms swept along the Interstate 35 
corridor. The San Antonio region, extending northward through the New 
Braunfels and into the Austin area, was hit especially hard. The 
heaviest rainfall fell in Bexar, Hays, Comal, Guadalupe, and Caldwell 
Counties. Rainfall in these areas totaled between 18 and 31 inches, 
with rain falling at a rate of 2-3 inches per hour for prolonged 
periods. This was the most rainfall recorded since records have been 
kept, beginning in 1885.
    In spite of these conditions, the loss of life and property damage 
was greatly reduced in those watersheds protected by Public Law 566 
floodwater retarding structures. In the Upper San Marcos River 
Watershed alone, the floodwater protection structures resulted in an 
estimated $20 million in benefits. These include flooding depths, which 
were reduced by 6-8 feet in the City of San Marcos. Had these 
structures not been in place, the likelihood of loss of life and 
tremendous property loss would have been a certainty.
             food and agriculture policy research institute
    Question. Mr. Collins, what is your knowledge of the Food and 
Agriculture Policy Research Institute (FAPRI) in the context of our 
nation's interests in economic intelligence and informing the public of 
economics and policy of agriculture and food?
    Answer. I am very familiar with the work of the university 
consortium, FAPRI. They have an excellent record of collecting and 
reporting on global agricultural information, projecting long term 
trends in agricultural markets and analyzing key policy options. FAPRI 
makes their analysis available through publications and briefings, 
including frequent briefings to USDA staff and others in Washington, 
D.C.
    Question. If the work of this consortium and potentially others is 
so important, can you tell me how much money your department is putting 
or wants to put into the support of these centers?
    Answer. USDA provided $800,000 to FAPRI, specifically the 
University of Missouri and Iowa State University in fiscal year 1999. 
No funds have been requested in USDA's budget for fiscal year 2000.
    Question. Apparently OMB is not supportive of funding the centers. 
Nevertheless, would you and others in the Department like to see these 
policy research centers supported.
    Answer. I would like to see FAPRI continue its work and maintain a 
strong base of financial support. However, it is the policy of USDA 
that funds now used to support centers such as FAPRI should be used for 
competitively awarded, peer reviewed grants that meet National goals.
    Question. In 1996 and in 1998 laws were passed at Congress's 
initiative which provided authority for policy research centers to be 
supported. What can be done to adequately overcome the obstacles so 
that we can ensure that these benefits continue being provided.
    Funding for FAPRI has continued, even though not requested by USDA.
    At USDA, funding decisions are complicated by limits on available 
funds and priorities of needs, FAPRI has done an outstanding job of 
communicating its contributions to parts of its rural constituents, 
USDA and Congress. But FAPRI's contributions are less well known and 
understood in the broader research and education community in which is 
exists. I understand that FAPRI will be making an effort to broaden its 
communications among the research and education community's leadership 
and with other parts of USDA. The best way for FAPRI to maintain 
funding is to continue to usefully serve the needs of rural people by 
providing unique, relevant, competent, and timely information and 
analysis.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                             crop insurance
    Question. Why was there no funding included for crop insurance 
reform in the USDA fiscal year 2000 budget?
    Answer. We wish first to come to agreement on the needed changes, 
then identify the costs and work with Congress in a responsible manner 
to find the required funding.
             farm and foreign agricultural services budget
    Question. President Clinton promised to bring trade in line with 
agriculture. Yet, the Farm and Foreign Agricultural Services budget was 
decreased by nearly $6.5 billion. Two of the main programs for export, 
the Export Enhancement Program and the Food for Peace program, were 
reduced by $56 million and $772 million respectively. With 70 percent 
of Montana's grain being sent for export we cannot afford to lose these 
important programs. How will the Administration restore this money? Why 
has the funding currently in the Export Enhancement Program not been 
distributed to producers? How will USDA restore lost export 
opportunities to producers?
    Answer. Although the budget shows a reduction in the overall 
program level for USDA international activities in 2000, this is 
primarily due to the sizeable increase in food aid programming during 
1999 which results from extraordinary circumstances this year. For 
2000, the budget assumes food aid programming will return to a more 
traditional level. On the other hand, the 2000 budget provides a total 
program level of $6.5 billion for USDA international activities; this 
is considerably higher than the actual level for 1998 of $5.7 billion.
                 commodity credit corporation programs
    Question. Several programs important to export enhancement were 
cut. The Commodity Credit Corporation Program was cut by $5.8 billion, 
the Dairy Export Incentive Program by $15 million and the Food for 
Progress program by $24 million. With today's global market situation, 
producers cannot afford to have the few opportunities they have for 
export reduced. How will USDA restore lost export opportunities to 
producers?
    Answer. During the past year, USDA has responded vigorously and 
creatively to developments in world financial and commodity markets. As 
a result, the level of programming for many of our export activities 
has increased substantially. For example, in response to the financial 
crisis in Asia, USDA expanded the level of CCC export credit guarantees 
made available. As a result, sales registrations under the guarantee 
programs were 40 percent higher during 1998 compared to the previous 
year. The expanded level of guarantee programming is expected to 
continue in both 1999 and 2000.
    This fiscal year, USDA has greatly expanded the level of foreign 
food assistance programming, and the overall level of U.S. foreign food 
assistance will total as much as 10 million metric tons this year. This 
increase results from the President's Food Aid Initiative under which 5 
million metric tons of wheat and wheat products will be made available 
to countries requiring assistance in meeting their food import needs. 
It also reflects a major package of food assistance for Russia which 
will total more than 3.1 million metric tons, including 1.5 million 
metric tons of wheat to be made available under the President's Food 
Aid Initiative.
    Question. The CCC provides an important service for private 
negotiations with other countries. Agricultural producers have an 
increasing need for avenues to market their products through private 
entities. The budget cut to CCC makes them more dependent on the 
federal government, rather than giving them opportunities to expand 
marketing channels. How does the USDA intend to provide producer 
assistance for marketing, private or otherwise?
    Answer. There are currently only two USDA programs that are 
categorized as export promotion programs--the Market Access Program 
funded at $90 million and the Foreign Market Development Cooperator 
Program funded at $27.5 million. However, FAS administers various other 
agricultural export assistance programs including the Emerging Markets 
Program, Section 108, and the Cochran Fellowships.
    Last fall, the FAS began a new initiative--known as the Unified 
Export Strategy (UES)--to more effectively coordinate strategic 
planning and resource allocation processes across these various 
agricultural export assistance programs. The UES was developed to 
streamline the application process for these programs and facilitate 
better use of complementary marketing tools and resources. Through the 
submission of a single proposal, organizations may apply for assistance 
under the Market Access Program, the Foreign Market Development 
Cooperator Program, the Emerging Markets Program, Section 108 and make 
recommendations for trade policy initiatives, Cochran Fellowships, or 
Export Credit Guarantee programs.
    In addition, the fiscal year 2000 budget proposes a new program, 
Quality Samples Program (QSP). The QSP would use CCC funds to assist 
U.S. commodity organizations in providing commodity samples to foreign 
importers in order to promote a better understanding and appreciation 
for the high quality of U.S. agricultural commodities.
                             trade barriers
    Question. Trade inequities continue to be a major problem, 
especially with Canada, the European Union and China. When will the 
Foreign Agricultural Service step in to reduce trade barriers and 
resolve international trade disputes?
    Answer. Unfortunately, U.S. agricultural exports are subject to 
import duties and non-tariff trade restrictions in nearly every foreign 
market. Many of these restrictions are permitted under international 
trade rules, just like U.S. tariffs and import requirements. FAS has 
worked diligently over the years to identify and seek the removal of 
barriers which are not consistent with international trade rules or 
which are particularly restrictive for U.S. exports. There are many 
examples of FAS activities which have helped to remove or prevent the 
imposition of barriers to U.S. exports. These include the use of the 
WTO Committee on Agriculture to obtain the removal of WTO inconsistent 
trade barriers, bilateral talks to open the Japanese market for U.S. 
wood products through deregulation of its housing sector, removal of 
Chilean and Brazilian restrictions on U.S. wheat, new access to 
Taiwan's market as part of its WTO accession, and many other specific 
cases.
    Some trade restrictions are more difficult to resolve than others. 
The inequities with Canada, the EU and China that you mention are the 
best examples.
    FAS, in cooperation with other USDA agencies and the U.S. Trade 
Representative continue to work on these issues, and we have made some 
progress. For example, the December 1998 Record of Understanding with 
Canada begins to address many of Canada's barriers to U.S. exports and 
the Veterinary Equivalency Agreement with the European Union is an 
important step towards resolving many of our differences on food safety 
issues with Europe. We also have had a number of market access gains in 
China, getting them to allow access for U.S. grapes and a number of 
livestock products. On other issues where we have not yet been able to 
reach agreement, the United States has vigorously pursued our rights 
under international agreements. We will continue to work with our 
trading partners on these issues, and will be prepared to take the 
necessary action if acceptable resolutions cannot be reached.
                 natural resources conservation service
    Question. Why was funding for the GLCI (Grazing Lands Conservation 
Initiative) held level under the NRCS budget rather than be increased? 
This program is invaluable to ecosystem management. This program 
provides education and technical assistance to agricultural producers.
    Answer. NRCS utilized congressional recommendations to maintain 
level funding for GLCI. NRCS did provide technical assistance staffing 
to assist in the voluntary application of conservation on grazing 
lands, including GLCI, that exceeded $33 million in fiscal year 1998.
    Question. Funding should be increased from $15 million to at least 
$20 million. How will USDA implement an increase for GLCI?
    Answer. Should GLCI be earmarked at $20 million NRCS will continue 
to implement a program to provide for additional staffing, training, 
technical assistance, public awareness and project activities in an 
attempt to meet increasing workload demands.
                        emergency appropriations
    Question. Congress appropriated approximately $6 billion to come to 
the aid of farmers and ranchers, as an emergency supplemental 
appropriation. Many producers have seen none of this money due to 
deadlines and extensions. When will USDA be held accountable for this 
funding and disperse it to the people who desperately need it?
    Answer. While RMA is responsible for only $400 million of this 
assistance, these funds have already impacted farmers by providing them 
with the assurance of risk protection on their 1999 crop at a reduction 
of 30 percent or more in premium costs. Some farmers have applied the 
savings toward the purchase of higher levels of coverage, others can 
look forward toward more cash flow, which could enhance their ability 
to obtain credit. As for the rest of the emergency funding, it is our 
understanding that the requirements for prorating the funds available, 
as well as the need to help farmers make informed decisions among the 
choices in assistance for multi-year losses, have challenged USDA's 
field staff. Significant staff reductions over the last several years 
have also contributed to the difficulty in being timely in providing 
assistance. However, we are confident that USDA will eventually receive 
high marks for carrying out this responsibility in a fiscally sound and 
fair manner.
                                 ______
                                 
                  Questions Submitted by Senator Byrd
                          farm service agency
    Question. Once again, my questions concerning the Farm Service 
Agency (FSA) are targeted toward the issue of staff reductions. While I 
understand, and supported, necessary FSA staff reductions that occurred 
nationwide as a result of the USDA Reorganization Act of 1994 and the 
1996 Farm Bill, I am puzzled about reports that West Virginia is again 
being requested to reduce staff. I am particularly puzzled by the 
recent reduction proposal in light of the fact that West Virginia 
implemented the previous rounds of required reductions, and that I 
understood that the Congress provided funds last year to avoid further 
staff reductions in FSA during fiscal year 1999. Can you please explain 
this situation to me in detail?
    Answer. Yes, Congress did provide $40,000,000 in emergency funding 
included in the 1999 appropriations act which has allowed FSA to 
maintain about the same staffing levels in 1999 as in 1998, rather than 
separate additional personnel during the current crisis in production 
agriculture. That $40,000,000 did not provide funding for additional 
personnel to deal with greatly increased agency workload, however. West 
Virginia did reduce permanent full-time (PFT) staffing from fiscal year 
1994 through fiscal year 1998 by about 21 percent; however, this trend 
was nationwide with Midwestern and Northwestern States reducing PFT 
staffing by over 25 percent. The average nationwide decrease for PFT 
employees was just over 23 percent from 1994 through 1998. West 
Virginia has used and continues to effectively use shared management, 
office collocations and consolidations since the streamlining process 
began in 1994. After significant office consolidations in 1995, 
employment has been evaluated and adjusted over the last 3 years to 
maximize service within available funding. Of the 377 FSA county 
offices closed in some 37 states, 15 of these offices were in West 
Virginia. In fiscal year 1999 FSA began addressing the imbalance of the 
number of FSA employees relative to existing National workload. FSA 
established temporary ceiling goals for each State to work toward. This 
has allowed State Executive Directors to manage more efficiently and 
position themselves for realistic permanent staffing levels. We 
emphasize that no State is under any mandate to reduce the number of 
``on board'' employees nor will any State lose any monies allocated to 
date.
    Question. Can you please provide me with a report on your views of 
the FSA's role in West Virginia?
    Answer. Actual workload in West Virginia for fiscal year 1998 
indicates that present staffing is very closely aligned with current 
workload conditions in comparison to many other States where emergency 
and disaster programs have generated an extensive backlog of workload. 
FSA continually monitors workload in States to determine areas of 
increased workload and moves both human and monetary resources to those 
areas based on availability to provide the most effective and efficient 
service to its customers. State Directors are using a variety of 
management tools to ensure service to producers by initiating employee 
details, overtime, directed reassignments, shared management and office 
collocation and consolidation.
                 natural resources conservation service
    Question. I have long supported the important work of the Natural 
Resources Conservation Service (NRCS) in West Virginia. The state NRCS 
staff, including Bill Hartman and Paul Dunn, have done a fine job in 
implementing watershed and conservation programs in West Virginia that 
have made a positive impact to the state's rural communities, and I 
commend them for their efforts. My questions pertain to several West 
Virginia NRCS projects. Please provide a status report on the Potomac 
Headwaters Land Treatment Watershed Project, complete with pertinent 
timetables and participation rates.
    Answer. This land treatment watershed project is entering the third 
year of operation. During the first two years, 212 long term contracts 
were executed with landowners who agreed to install needed animal waste 
storage facilities and mortality composters, relocate or treat animal 
feeding operations to prevent pollution, and follow an agreed to 
nutrient management plan. Planned in these contracts are 216 storage 
structures, 94 composters, 75 feedlot improvements, 15 feedlot 
relocations, and 35,600 acres of nutrient management. As of this date 
84 storage structures, 25 composters, 18 feedlot improvements, and 6 
feedlot relocations have been completed. Funding for new contracts in 
fiscal year 1999 is $2,000,000, which will allow about 52 additional 
farmers to enter the program, bring the total participation rate up to 
83 percent. With these new contracts included (264 total) the estimated 
cost is $10,000,000. Of this amount, $5,350,000 is Federal cost, 
$1,070,000 a state cost, and the remaining $4,280,000 a landowner 
expense. Upon completion the Potomac Headwaters Project will yield the 
following benefits:

Potomac Headwaters Benefits

Total acres benefited...................................       1,787,850
Monetary agriculture benefits...........................      $1,131,100
Public facilities benefited (no.).......................              59
Farms benefited (no.)...................................             264
Disadvantaged benefited (no.)...........................           8,718
Direct beneficiaries (no.)..............................          72,654
Incidental recreation (no. water bodies)................              26
Erosion (tons)..........................................           8,200
Lakes/reservoirs protected (acres)......................           2,969
Animal waste (average annual tons)......................          90,733
Chemical and nutrient management (acres)................          35,600
Domestic water supply (no.).............................              60
Sponsor costs (as reported in plan).....................     $10,700,000
Sponsor operation. Maintenance, and replacement (as 
    reported in plan)...................................        $294,400
Tons commercial fertilizer displaced by available litter          90,720

    The long-term contracts with the landowners are 10 years in 
duration. All conservation practices will be installed during the first 
five years of the contract. The remaining years are an operation and 
maintenance period to assure compliance with program requirements.
               flood control structures in west virginia
    Question. Please provide a full list of all flood control projects 
in West Virginia that are currently under construction, the cost 
associated with that construction, and a timetable for the completion 
of each project.
    Answer. The following is a list of flood control projects under 
construction in West Virginia, including the Federal construction cost 
and the timetable for completion:
  --Cranberry Creek Channel Improvement Project, Raleigh County, WV
    Federal Cost: $16,355,289
  --Completion Date: May 1999--(completed except for landscaping, which 
        will be completed May 1999)
  --Little Whitestick Channel Improvement Project, Raleigh County, WV
    Federal Cost: $4,019,016
    Construction bids received on February 10, 1999
    Completion Date: August 2001
  --Upper Mud Recreation Facilities, Lincoln County, WV
    Cost: $1,278,197.08
    Completion Date: June 1999
     west virginia flood control projects with feasibility studies
    Question. Please provide a full list of flood control projects in 
West Virginia for which feasibility studies have been completed.
    Answer. The following is a list of flood control and other projects 
West Virginia that have completed feasibility studies or are in some 
phase of the planning process:
Plan Completed:
    Inwood Watershed, Berkeley County.--The NRCS provided technical 
assistance to the Eastern Panhandle Soil Conservation District and a 
watershed group to develop a Local Implementation Plan (LIP). The LIP 
addresses flooding in a rapidly developing area of Berkeley County. 
This plan was completed in December 1998.
Plans Underway:
    Deckers Creek Watershed, Preston and Monongalia Counties.--Water 
quality is the primary purpose of this plan. Eleven treatment systems 
are proposed to address acid mine drainage in Deckers Creek and 
tributaries. Installation of systems over a ten-year period will raise 
pH and improve water quality in 23.7 miles of stream. NRCS has 
extensive water quality data to aid in design of effective systems. The 
plan is 90 percent complete. Dunloup Creek Watershed, Fayette County--
The purposes of this project are flood protection, water supply, and 
recreation. The NRCS is preparing a local implementation plan to 
address these problems. A local watershed group is providing input to 
the effort. The plan is about 95 percent complete.
    Fayette County Water Resources Study.--This study is cooperatively 
funded by the NRCS and the WVSCA. The planning effort will result in a 
comprehensive water resources plan addressing water supply, water 
quality, flooding, sewage, and recreation. A county-wide steering 
committee is providing local input. The plan is about 98 percent 
complete.
    Hardy County Resources Study.--The Hardy County Commission has 
requested a county-wide natural resources study. The county is 
anticipating expansion of land and water resource needs with the 
planned construction of Corridor H and associated economic development. 
Kings Creek Watershed, Hancock County--This local implementation plan 
evaluates and compares flood damage reduction alternatives. Non-
structural measures and limited channel improvement appear to be the 
most economically feasible alternatives, based on planning studies. The 
plan is about 95 percent complete.
    Logan/Mingo Counties Resources Study.--Local officials and the 
Pigeon Creek Watershed Association have requested NRCS assistance in 
conducting a study of natural resources concerns and potential 
solutions. The county is experiencing accelerated development with the 
recent construction of Corridor G.
    North Fork South Branch Potomac River Watershed, Grant and 
Pendleton Counties.--Local citizens have formed a watershed association 
to work with NRCS and other agencies to solve watershed problems. The 
catalyst for the formation of the watershed association was two severe 
floods in January and May 1996. The watershed association obtained the 
sponsorship of the Potomac Valley Soil Conservation District and the 
County Commissions and requested NRCS planning assistance. NRCS is 
preparing a Watershed Management Plan utilizing the CBA planning 
concept. The area of focus, as agreed to by the North Fork Watershed 
Association and numerous involved agencies, interest groups, and other 
stakeholders are water quality, flooding, streambank erosion, water 
supply, grazing lands, wetlands, and forest management. The planning 
process is about 40 percent complete.
    Pleasant Valley Watershed, Marion County.--The NRCS is providing 
technical assistance to the Monongahela Soil Conservation District and 
a local watershed advisory group in developing a Local Implementation 
Plan that will address flooding. This plan is 15 percent complete.
    Upper Tygart Valley Watershed, Randolph County.--The NRCS is 
providing assistance to project sponsors and the Upper Tygart Valley 
Watershed Partnership in developing a Watershed Plan and NEPA 
compliance document. Project purposes include water supply, water 
quality, flood protection, fish and wildlife, and conservation land 
treatment. This project is 10 percent complete.
Projects Underway: Public Law-566
    Upper Mud River Watershed, Lincoln and Boone Counties.--The current 
cost of the project is $23,800,000, including $13,300,000 Federal cost 
and $10,500,000 non-Federal cost. One multi-purpose dam for flood 
prevention and recreation was completed in 1994. Remaining work 
consists of construction of recreation facilities. The fishing part of 
these facilities was completed in 1996. The remaining recreation 
facilities are under construction as a local contract ($2,556,000) and 
are scheduled for completion in February 1999.
    Little Whitestick--Cranberry Creeks Watershed, Raleigh County.--The 
current Federal cost is $25,500,000. The 2.1 miles of channel 
improvement on Cranberry Channel was completed in 1998. The 1.5 miles 
of channel on Little Whitestick is presently being advertised for 
construction bids, and the work is expected to begin in late April. 
Local sponsorship is very strong. Landscaping work will be done during 
this spring for the Cranberry Channel.
    Mill Creek Watershed, Jackson and Roane Counties.--Six structures 
are planned and five have been completed. The Federal cost is 
$25,000,000. The final dam (No. 6) will be evaluated for feasibility.
    Upper Buffalo Creek Watershed, Marion County.--Estimated Federal 
cost is $30,100,000. The project has been modified by supplement dated 
April 1994 to seven dams and 1.9 miles of channel improvement. All 
seven dams have been completed. The channel improvement was completed 
in October 1997 at a total cost of $5,109,228, and landscaping was 
completed in April 1998. The subchannel will be extended a total of 
1200 linear feet in three areas of Upper Buffalo Creek downstream of 
the completed channel work. Bidding and contracting for the work will 
take place in August 1999, with construction scheduled to start in 
September. Estimated cost of the additional subchannel is $56,000.
    Elk Twomile Creek Watershed, Kanawha County.--The project consists 
of six single purpose flood prevention dams. Four have been completed. 
The feasibility of proceeding with the remaining sites is being 
evaluated.
Projects Underway: Public Law 534
    Lost River Watershed, Hardy County.--The total estimated cost is 
$37,700,000 of which $34,000,000 is Federal cost. The project includes 
4 single purpose structures and 1 multipurpose structure. Dam No. 4 
(single purpose FP) was completed in 1996. Dam No. 27 (single purpose 
FP) was completed in December 1998. The three remaining dams remain 
viable and are scheduled for construction over the next 5 years pending 
Congressional appropriations. Local sponsorship is strong.
    New Creek Watershed, Grant and Mineral Counties.--Nine of twelve 
dams planned for this watershed have been completed. New measures 
needed to replace protection provided by the remaining three dams and 
to address other natural resources problems are being evaluated.
    North and South Mill Creek Watershed, Grant and Pendleton 
Counties.--The total estimated cost is $15,999,999 of which $12,800,000 
is Federal cost. The project includes 5 single purpose structures and 1 
multi-purpose structure. Three of the single purpose structures have 
been installed with $5,300,000 Federal obligations through fiscal year 
1990. Dam No. 7 (multipurpose dam--FP & Recreation) was completed in 
December 1993 at a cost of $6,350,000. The recreation facilities were 
completed in 1996. The two remaining dams are not feasible and will be 
deleted from the project through preparation of a supplement.
    Patterson Creek, Grant and Mineral Counties.--The estimated Federal 
cost is $25,600,0000. The project includes 33 single purpose flood 
prevention dams and one multi-purpose structure for flood prevention 
and water supply. Thirty of the single purpose dams have been completed 
along with the single multi-purpose dam. The feasibility of proceeding 
with the two remaining dams is presently being evaluated.
    South Fork Watershed, Pendleton and Hardy Counties, West Virginia 
and Highland County, Virginia.--Twenty-three of 24 single purpose flood 
preventiondams have been completed. One dam (No. 20) on the Upper South 
Fork remains to be built. The local sponsors are presently not 
interested in building this structure.
                environmental quality incentives program
    Question. Please provide a status report of the Environmental 
Quality Incentives Program in West Virginia.
    Answer. The Environmental Quality Incentives Program in West 
Virginia has been very successful in the first 2 years of program 
implementation, as evidenced by the high demand being placed on the 
program by the State's farmers. The demand by farmers far exceeds 
available funds. In fiscal years fiscal year 1997 and 1998, there was a 
6:1 and 4:1 ratio, respectively. It is expected to be similarly high in 
fiscal year 1999.
    During fiscal year 1997 and 1998, $1,995,000 and $1,809,000, 
respectively, were allocated here. The NRCS State Conservationist, with 
the advice of the West Virginia State Technical Committee, including 
the Farm Service Agency (FSA), selected four priority areas where most 
of the funds would be used. These areas were over 250,000 acres in size 
with typically between 100,000 to 150,000 acres of agricultural land 
needing treatment. Ninety-five percent of funds were used to address 
livestock-related natural resource concerns.
    In fiscal year 1997, approximately $1,600,000 of financial 
assistance were provided to 362 farmers for long-term contracts. These 
contracts provided assistance on: 5,856 acres of prescribed grazing; 
6,848 acres of nutrient management; 4,080 acres of pesticide 
management; winter feeding areas and other conservation practices. In 
fiscal year 1998, approximately $1,400,000 were distributed to 265 
farmers for contracts that will treat 18,233 acres.
    Priority areas were revised in fiscal year 1999, based on watershed 
boundaries. There were a total of 24 priority areas identified 
throughout the State. The largest agricultural area to be treated in 
any priority area will be 50,000 acres, and 750 acres will be the 
smallest. This revised approach will allow NRCS to quickly and more 
thoroughly address the major natural resource concerns in a specific 
watershed. It is anticipated that an increase of environmental benefits 
will be attained with the watershed approach. Service center personnel 
have completed one-on-one visits with farmers and are determining 
contract costs for fiscal year 1999. Conservation plans and contracts 
will be developed and awarded within the next 2 months. Of the 
$1,584,000 allocated to the State, about $1,280,000 are available for 
financial assistance.
    West Virginia's soil conservation districts have convened the local 
work groups for identification and prioritization of priority areas in 
fiscal year 2000. The local work groups consist of local farmers, 
conservation district supervisors, FSA county committeemen, and other 
local, State, and Federal agencies.
        status of alderson, west virginia plant materials center
    Question. Please provide a status report on construction of the 
Plant Materials Center in Alderson, West Virginia, and a flow chart 
illustrating the release and award of funds appropriated for the 
project.
    Answer. The project is progressing well, and it should be completed 
by late fall of 1999. Sufficient funds were provided to the Plant 
Materials Center in the fiscal year 1999 budget to complete 
construction work.
    Construction of the seed barn is complete, and the building is now 
being used as a temporary office. This building forms the hub for 
operations at the center. Work on the office is underway, and the 
building is now ``under roof'' with work proceeding on the interior. It 
is about 60 percent complete. The building should be completed by May 
and occupied by June. Specifications are due in April for the shop/
storage building, and construction is expected to start on it in June. 
Construction on the final building, the greenhouse, is scheduled to 
begin in July.
    In addition to construction activities, there is a parallel effort 
underway to bring field operations on-line. Weed control has been a 
problem in many fields, but active control measures are underway to 
eliminate it. Several of the fields have already been planted to 
grasses and/or herbaceous species. In the spring of 1999, the center 
will move part of the woody plant collection (50 clumps) from 
Quicksand, Kentucky to Alderson. In the fall, the remainder of the 
woody plants will be transferred.
    With construction activities completed by fall and with field 
studies also in place, it is anticipated that a Plant Materials Center 
dedication can be held early in 2000.
    Funds for the Plant Materials Center in fiscal year 1999 have been 
provided to: (1) conduct operations, and (2) complete construction for 
the project. A flow chart illustrating the release and award of funds 
for the project in fiscal year 1999 may be found in the table on the 
following page.

  CAPITAL IMPROVEMENTS FLOW CHART, ALDERSON, WV PLANT MATERIALS CENTER
------------------------------------------------------------------------
                                       Pre-Fiscal    Fiscal
Description of Construction & Related   Year 1999   Year 1999   Timeline
               Activity                   Funds       Funds       Date
------------------------------------------------------------------------
Allocation of Congressional earmarked  ..........     433,000      10/98
 funds...............................
Allocation of Plant Materials Program  ..........     267,000      10/98
 funds...............................
                                      ----------------------------------
      Total allocated................  ..........     700,000
                                      ==================================
   Plant Materials Center Buildings
 
Seed barn & associated facilities         469,498  ..........        3/9
 5,000 sq. ft. building, Pesticide
 building, Roads/parking areas for
 plant center, Sewage treatment
 system for plant center, Drainage
 system for plant center, Utility
 distribution system for plant center
Specifications provided for office     ..........  ..........      10/98
 building............................
Construction initiated for office      ..........  ..........      10/98
 building............................
Construction completed for office      ..........     200,000       5/99
 building............................
Specifications provided for shop/      ..........  ..........       4/99
 storage building....................
Construction initiated on shop/        ..........  ..........       6/99
 storage building....................
Construction completed on shop/        ..........     250,000       9/99
 storage building....................
Specifications provided for            ..........  ..........       6/99
 greenhouse building.................
Construction initiated on greenhouse   ..........  ..........       7/99
 building............................
Construction completed on greenhouse   ..........     140,000       9/99
 building............................
 
 Other Physical Facility Developments
 
Seed cooler..........................      55,000  ..........       3/99
Utility relocation...................      15,000  ..........       2/99
Transport equipment & plant materials      80,000  ..........       4/99
Transport equipment & plant materials  ..........      67,000      12/99
Field irrigation system..............  ..........      35,000      11/99
Drainage system repair...............  ..........       8,000       9/99
Pre fiscal year 1999 Funds Spent on       619,498  ..........  .........
 Capital Improvements................
                                      ----------------------------------
Total fiscal year 1999 Funds Spent/    ..........     700,000  .........
 Estimated...........................
                                      ==================================
Total funds provided for capital        1,319,498  ..........  .........
 improvement.........................
                                      ==================================
Project completed....................       12/99  ..........  .........
------------------------------------------------------------------------

                                 ______
                                 
                  Questions Submitted by Senator Kohl
                  farm safety net/emergency assistance
    Question. Please provide an overview, to the extent possible by 
State and commodity, of the levels of emergency assistance provided to 
producers as a result of the $5.9 billion made available in the Omnibus 
Appropriations Act for fiscal year 1999.
    Answer. We are able to provide data only on market loss assistance 
payments as of March 2, 1999.
    [The information follows.]

                                                                        MARKET LOSS ASSISTANCE PAYMENTS, FISCAL YEAR 1999
                                                                                      [As of March 2, 1999]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Corn           Sorghum         Barley           Oats            Wheat          Upland           Rice            Total
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Alabama.........................................................       3,055,087         527,052           2,792          15,994       2,832,130      13,243,767              35      19,676,857
Alaska..........................................................  ..............  ..............          74,813             609             487  ..............  ..............          75,909
Arizona.........................................................         607,873         133,091         186,456           2,604       2,490,656      17,588,927  ..............      21,009,607
Arkansas........................................................         947,769       4,602,759             150          25,893      14,717,235      21,427,665      91,555,927     133,277,398
California......................................................       4,277,254         153,685       1,754,401          27,261      13,477,508      33,365,517      46,464,170      99,519,796
Colorado........................................................      16,566,695       1,878,009       1,546,463          25,352      27,715,428               0               0      47,731,947
Connecticut.....................................................         479,926             370              18              44             428               0               0         480,786
Delaware........................................................       1,628,162          50,513         159,242              93         476,605               0               0       2,314,615
Florida.........................................................       1,303,271         127,815               2           8,424         498,414       1,920,085         186,713       4,044,724
Georgia.........................................................       8,279,950         628,464          54,143          42,786       7,693,982      22,228,410               0      38,927,735
Idaho...........................................................       1,111,108           6,843       6,426,883          20,669      26,997,389               0               0      34,562,892
Illinois........................................................     211,778,311       2,214,520          23,104          96,529      18,927,303               0               0     233,039,767
Indiana.........................................................     104,850,882         121,653          15,958          28,790       9,789,595               0               0     114,806,878
Iowa............................................................     264,647,969          75,600          32,115         473,118         888,156               0               0     266,116,958
Kansas..........................................................      31,513,153      44,597,344       1,004,991         119,947     120,570,938          20,191               0     197,826,564
Kentucky........................................................      22,937,515         436,701         127,618           3,868       5,351,049           1,679           8,219      28,866,649
Louisiana.......................................................       2,851,914       1,873,284              83          10,045       2,807,770      25,741,976      37,006,642      70,291,714
Maine...........................................................         372,089               0          41,319          18,574           4,668               0               0         436,650
Maryland........................................................       5,995,735          89,950         259,795           2,171       1,507,804             188               0       7,855,643
Massachusetts...................................................         309,473             139              35             117             385               0               0         310,149
Michigan........................................................      40,393,089          10,641         224,811         137,000       8,174,772               0               0      48,940,313
Minnesota.......................................................     120,338,415           7,864       5,891,823         556,601      34,750,683               0               0     161,545,386
Mississippi.....................................................       1,961,887       1,569,987             138           7,770       5,146,159      39,129,148      18,838,001      66,653,090
Missouri........................................................      38,807,188      10,190,214          64,232          37,410      23,807,205       7,017,915       7,949,699      87,873,863
Montana.........................................................         895,361           7,211      11,033,044          93,899      51,647,661               0               0      63,677,176
Nebraska........................................................     146,817,977      23,318,821         434,601         241,745      28,243,814              37               0     199,056,995
Nevada..........................................................          21,114           3,146         128,878           2,640         324,854               0               0         480,632
New Hampshire...................................................         219,880             210             151               5               0               0               0         220,246
New Jersey......................................................       1,111,363           5,349          36,147           1,471         238,504               0               0       1,392,834
New Mexico......................................................       1,831,672       2,523,702         148,609           2,452       3,494,988       1,979,982               0       9,981,405
New York........................................................      13,466,363           1,913          84,295          77,667       1,588,483               0               0      15,218,721
North Carolina..................................................      15,079,245         261,607         186,621          25,170       5,820,753      10,307,976               0      31,681,372
North Dakota....................................................      10,913,294          41,992      15,956,731         514,068      95,599,852               0               0     123,025,937
Ohio............................................................      63,455,436          14,364          26,026          86,608      14,592,680               0               0      78,175,114
Oklahoma........................................................       1,937,064       3,566,474         107,457          57,371      62,414,607       7,195,900          92,708      75,371,581
Oregon..........................................................         490,221           7,037       1,524,044          32,143      16,259,803  ..............  ..............      18,313,248
Pennsylvania....................................................      10,626,350          37,510         167,882          73,948         937,725  ..............  ..............      11,843,415
Rhode Island....................................................          16,110             109  ..............  ..............  ..............  ..............  ..............          16,219
South Carolina..................................................       5,179,954         121,042          68,335          23,362       3,711,968       5,694,969              28      14,799,658
South Dakota....................................................      42,133,538       2,908,611       3,401,315         733,147      31,178,259  ..............  ..............      80,354,870
Tennessee.......................................................       8,810,127         919,535          27,499           2,933       5,265,082      12,817,016          71,776      27,913,968
Texas...........................................................      27,959,935      38,267,920         216,912         156,518      45,341,714      95,595,806      35,336,426     242,875,231
Utah............................................................         557,115           9,019         732,476           5,398       2,439,269  ..............  ..............       3,743,277
Vermont.........................................................         732,519               6           4,198             928           4,233  ..............  ..............         741,884
Virginia........................................................       6,553,040         154,783         429,629           6,359       2,772,059         916,683  ..............      10,832,553
Washington......................................................       1,457,889             836       5,275,135          12,386      39,833,089  ..............  ..............      46,579,335
West Virginia...................................................         994,825           3,158          19,444           2,758          85,859  ..............  ..............       1,106,044
Wisconsin.......................................................      59,833,540          14,223         455,612         399,266       1,708,404  ..............  ..............      62,411,045
Wyoming.........................................................       1,153,385           2,131         724,578          21,215       2,368,116  ..............  ..............       4,269,425
                                                                 -------------------------------------------------------------------------------------------------------------------------------
    Totol.......................................................   1,307,262,032     141,487,207      59,081,004       4,235,126     744,498,525     316,193,837     237,510,344   2,810,268,075
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                    timing and effect of assistance
    Question. Please include any timetables available to indicate when 
producers may expect to receive assistance plus an analysis of the 
degree to which the assistance made available by the aforementioned Act 
will remedy shortfalls in farm income due to either production or 
market losses in 1999.
    Answer. Within 10 working days of the omnibus bill's enactment, 
USDA began making income loss assistance payments. By November 21, 
1998, USDA had paid 1.4 million farmers more than $2.8 billion.
    On November 12, 1998, USDA announced the Livestock Assistance 
Program (LAP) and began taking applications on November 23, 1998. To 
accommodate the extremely high demand for LAP, USDA extended the signup 
for this program and now plans to close enrollment on March 25, 1999. 
USDA will issue payments shortly thereafter. We estimate that the $200 
million Congress appropriated for livestock assistance will be heavily 
over-subscribed, and USDA, consequently, will be able to pay only a 
portion of the total request.
    On March 15, 1999, the sales closing date for the 1999 crop 
insurance program, USDA will have disbursed the $400 million dedicated 
to lowering crop insurance premiums--the Administration's down payment 
on its commitment to strengthening the farm safety net by reforming and 
improving crop insurance.
    USDA has implemented the honey and mohair loan programs included in 
the bill.
    In the near future USDA's plans for the $200 million dairy 
assistance program will be announced.
    USDA now expects to make CLDAP payments in June, following a 6-
month signup program, the same length of time USDA ran the signup for 
the 1988 disaster assistance program, the last time USDA had to 
implement a major, new crop loss assistance program. While USDA was 
able to use the 1988 program as a template for subsequent programs, we 
could not do so for this year's program.
    The additional resources sought by the Administration and approved 
by Congress have been instrumental in keeping thousands of farmers and 
ranchers in business during tough times. USDA is at your disposal to 
provide any additional information about implementation of these 
programs.
                       state of the farm economy
    Question. Please provide any information available about the state 
of health of the farm economy at present and the extent to which 
producers may not be able to continue viable farming or ranching 
operations this coming year even with the assistance provided in the 
fiscal year 1999 Act.
    Answer. The farm economic outlook for 1999 is not favorable. In 
1998, the farm economy took a sharp downturn when bad weather 
devastated many production regions from California to Florida, while 
grain and oilseed prices nosedived as a result of large global 
supplies, the deepening Asian financial crisis, and weak export demand. 
Livestock prices also dropped due to large supplies, and hog prices 
went into a free fall late in the year. Unfortunately, exports and 
commodity prices likely will be even lower in 1999, causing increased 
farm financial stress, particularly in grain and oilseed producing 
areas, such as the Corn Belt States, that up to now have weathered the 
economic downturn.
    U.S. farm exports, for example, are expected to drop to $49 billion 
in fiscal year 1999--down $4.6 billion from fiscal year 1998 and nearly 
$11 billion from the peak in 1996. Net farm income is expected to drop 
to $44.6 billion for 1999, a 7-percent decline from 1998 and a 16-
percent drop from 1996. Net income just for key field crops (wheat, 
corn, soybeans, upland cotton and rice) will be 17 percent below the 
average for the past 5 crop years for the 1998 crops, and for the 1999 
crops, net income is projected to be 27 percent below the previous 5-
year average. USDA's revised baseline projections for the next 10 years 
indicate that economic recovery will occur at a very gradual pace.
    The nearly $6 billion in government assistance enacted last year is 
helping to maintain farm income and ease financial hardship for many 
producers. Direct government payments to producers reached nearly $13 
billion in calendar year 1998 and will probably total at least $11 
billion in 1999. Also, lower interest rates and fuel costs have helped 
reduce production costs, offsetting some of the decline in cash 
receipts for many producers.
    However, aggregate measures of the health of the farm economy mask 
a marked erosion in market income in many regions and commodity 
sectors, and all signs now point to greater farm financial stress in 
1999. Net cash income is currently projected to decline $3-4 billion. 
Land values began declining in a number of Midwestern States during the 
last half of 1998, after years of steady increases. The drop in income, 
coupled with declining asset values for many producers, means many will 
have difficulty obtaining credit, and those who do will use it for 
variable cash expenses, not investment, and will find themselves 
squeezed trying to repay debt out of current income. For the many 
producers who struggled with cash flow in 1998 because of adverse 
weather and low prices, problems likely will worsen in 1999.
    As a result of increased financial stress in farm country, demand 
for USDA farm loans in fiscal year 1999 has been extremely strong. Many 
farm families who have been financing their business operations through 
their own resources or with a minimum of commercial bank debt are now 
seeking farm loan assistance. Commercial lenders are utilizing Farm 
Service Agency loan guarantees to restructure the short-term 
indebtedness of their customers into more favorable long-term rates so 
that they can continue to provide financing. FSA is using all servicing 
authorities, including rescheduling and reamortizing, deferring 
installments, and debt writedowns to assist FSA borrowers.
    However, funds are exhausted or will soon be exhausted for key 
credit programs: all emergency loan funds and non-targeted direct farm 
ownership loan funds have been obligated already; non-targeted 
interest-assisted guaranteed loans and direct farm ownership loans will 
be exhausted in March; funding for direct farm operating loans will 
last into April, and guaranteed operating loan funding will be gone by 
August. Credit is no substitute for income, but adequate credit is 
essential to maintaining any farm operation.
    For many farmers and ranchers the key to weathering the farm crisis 
is duration: how long the period of low commodity prices will last. 
According to a 1998 Iowa State University study of 1,200 Iowa farmers, 
those in basically strong or stable financial condition can withstand a 
year of low prices, but if these conditions were to continue for 
several years, one-third of the farmers in the study would face 
restructuring or liquidation.
    There are many uncertainties that could affect market demand and 
prices, and, hence, farmers' well-being over the next 1 to 2 years. 
Weather is always key; so is the world economy for a farm sector as 
export-dependent as American agriculture.
                          dairy policy reform
    Question. Would you please provide your observations or suggestions 
relating to changes in USDA programs to help move toward a more 
rational and fair dairy policy through either regulatory action or 
legislation? In particular, would you address steps that might be taken 
to help find a policy of comity among all regions to eliminate the 
otherwise unavoidable conflict and turmoil that would result from 
regional compacts or other tools of geographic disparity?
    Answer. On or before April 4th, the U.S. Department of Agriculture 
(USDA) will issue its final decision on consolidation and reform of 
Federal Milk Marketing Orders as mandated by the Federal Agriculture 
Improvement and Reform Act of 1996 (1996 Act), as amended. In the 
nearly 3 years since enactment of the 1996 Act, USDA has requested 
information from all segments of the dairy industry and received nearly 
4,500 comments on Federal order reform and consolidation. In addition, 
USDA established agreements with dairy industry experts in the academic 
community to analyze specific issues, including the Class I price 
structure and replacement of the Basic Formula Price (BFP) for milk, 
and conducted several listening sessions around the country before and 
after release of USDA's proposed rule in January 1998. We believe this 
meticulous approach in informing the public and obtaining input from 
interested parties will yield a final decision that is in the best 
interests of all segments of the dairy industry and be fair to all 
areas of the country.
                          emergency precedents
    Question. USDA recently announced the granting of $50 million to 
hog producers to help offset the dramatic reduction in price. How does 
the Department intend to address similar requests from producers of 
other commodities (e.g. beef cattle, aquaculture, minor crops, etc.) 
now that a precedent appears to have been established?
    Answer. Hog producers were hit with the lowest prices in 5 decades, 
and we made every effort to find a way to help producers. We would hope 
to be able to help other producers in similar circumstances and are 
working hard to shore up the safety net for all farmers and ranchers.
                         risk management reform
    Question. It has been suggested that approximately $1 billion 
should be directed to reform crop insurance, including an expansion of 
revenue insurance. To what extent should the availability of any funds 
be used to expand new programs rather than improve existing programs? 
For example, during debate of the disaster assistance package last 
Fall, certain Senators complained that there should be no ``crop 
insurance requirements'' tied to assistance eligibility due to the fact 
that existing programs in their state were not economically viable. 
Should our commitment to make sure that existing crop insurance 
programs work in all states be any less than to create new programs?
    Answer. The Administration agrees that continual review of existing 
crop insurance programs is as essential as developing new insurance 
products and insuring new crops. Poorly designed or administered 
programs that fail to meet the producers' needs are counterproductive 
to the Administration's goal of strengthening the safety net for 
agriculture.
    As you note, some Senators stated last Fall, that the current 
insurance program was not viewed as attractive for certain crops in 
their states. Reasons vary, but dissatisfaction with premium costs are 
a major factor. RMA develops premium rates from the experience in each 
county and state. In some cases, the experience is poor, resulting in 
high premium rates. Cotton is such a crop. RMA has undertaken an 
extensive review of its experience for cotton in the states east of 
Oklahoma and Texas. Participation in the cotton crop insurance program 
at buyup levels in these states ranges from essentially nothing to over 
50 percent of planted acres. The intent of this review is to understand 
the causes of the poor experience that resulted in high rates in 
certain of these states. Once this review is completed, adjustments to 
premium rates for crop year 2000 can be considered. Similar reviews 
will be undertaken for other crops in other areas as resources permit. 
We are also initiating a pilot review of our methodology with the goal 
to publish new rates in a test area in 2000.
                       effects of climate change
    Question. To what extent is climate change having an impact of USDA 
policies? Recent weather events lead to a conclusion that adverse 
conditions are affecting agriculture more severely and more 
significantly than in earlier decades, resulting in more volatile 
markets, reduced farm income, and disruption of consumer expectations. 
How is USDA responding to these changes in terms of long-term policy 
and what recommendations would you make for Congressional action in 
this regard?
    Answer. Temperature increases can have both positive and negative 
effects on crop and forest yields, with the difference depending on 
location and on the magnitude of the increase. And, agricultural and 
forestry systems are most sensitive to extreme climatic events such as 
floods, wind storms, and droughts, and to seasonal variability. Climate 
change could alter the frequency and magnitude of extreme events and 
change seasonal patterns. Increases in rainfall intensity pose a threat 
to agriculture and forestry and the environment because heavy rainfall 
is primarily responsible for soil erosion, leaching of agricultural 
chemicals, and runoff that carries livestock waste and nutrients into 
water bodies. Adjustment costs are likely to be higher with greater 
rates of change. While climate change is not expected to seriously 
threaten the U.S. ability to produce enough food to feed itself through 
the next century, regional production patterns are likely to be 
affected.
    Strategies such as changing planting and harvest dates, rotating 
crops, selecting varieties for cultivation, changing irrigation 
practices, using fertilizers and pesticides, and choosing cultivation 
and forest management practices can lessen potential yield losses from 
climate change and improve yields in regions where climate change has 
beneficial effects.
    We need to improve our understanding of how extreme events could 
affect agriculture and forestry and develop appropriate management 
systems for coping with these events. And, we need more research to 
explain and predict how agriculture and forestry will be affected by 
climate change. USDA investment in additional research on the 
adaptation of appropriate strategies is needed to gain a better 
understanding of the climatic factors that affect enterprise level 
adoption such as information flow, access to capital, and the role of 
global change public programs and policies.
    We need Congressional support for our fiscal year 2000 research and 
climate change technology programs so we can conduct this vital 
research and demonstrate alternative management practices that not only 
address the climate challenge but provide significant co-benefits in 
the form of improved productive capacity of our soils, improved water 
quality, and habitat protection. We would also welcome your ideas on 
how USDA's programs can be augmented to include greenhouse gas 
abatement and carbon sequestration. And, we look forward to working 
with you to address the international challenge of reducing the 
atmospheric concentrations of greenhouse gases in the most cost-
effective way.
                              farm credit
    Question. Reduced farm income increases the difficulty of obtaining 
commercial credit. In many cases, commercial lenders are restricted by 
State and Federal banking requirements in a manner that will adversely 
affect farmers when cash flow, debt-to-assets ratios, or other 
financial conditions cannot be met. What role is USDA taking with the 
financial industry (including Federal and State regulators) to help 
farmers overcome banking regulatory burdens?
    Answer. FSA is increasing interest in the guaranteed program by 
making the program more accessible and easier to understand for both 
lenders and loan applicants. A Preferred Lender Program (PLP) has been 
developed for lenders experienced with the FSA guaranteed loan 
programs. Under the PLP, FSA will approve the lender's system of credit 
management up front, and the lender will then be able to obtain a 
guarantee under a simplified process tailored to each lender's own 
policies. The application will consist of a one-page signed form 
supplemented by a lender narrative addressing certain credit criteria. 
Furthermore, the guarantee will be automatically approved if we do not 
take any action within 14 days.
    Question. Does USDA intend to seek additional levels of direct farm 
credit for Farm Service Agency programs to help offset the growing 
difficulty of farmers to obtain operating capital from commercial 
lenders?
    Answer. Improvements being made to the guaranteed program, along 
with the higher level of available guaranteed loan funds, will 
sufficiently supplement direct loan funds in fiscal year 2000 so that 
the credit needs of family farmers can be fulfilled.
    Question. Does USDA intend to seek additional farm credit funding 
budget authority for fiscal year 1999?
    Answer. A request for additional fiscal year 1999 FSA farm loan 
funding of $1.1 billion was submitted to Congress by President Clinton 
on February 26, 1999.
                  loan deficiency payment calculations
    Question. It has come to my attention that differences in points of 
delivery for certain commodities in Wisconsin and Minnesota are working 
to the detriment of Wisconsin farmers in the calculation of Loan 
Deficiency Payments (LDP's). In other States it has been determined 
that the existing system for LDP calculations based on posted county 
prices did not accurately reflect prices received by producers. Please 
review the situation in Wisconsin and report your findings and actions 
taken to ensure fair and equitable treatment for Wisconsin producers.
    Answer. LDP's are calculated using county loan rates that are 
established once a year and Posted County Prices (PCP's) that may 
change daily. There is a common misconception that the PCP pricing 
system was designed to ensure that all producers of a commodity have 
the potential of earning the same marketing loan gain or LDP. In 
actuality, the primary objective of the PCP system is to determine a 
value as close as possible to the local cash market price in any given 
area. The PCP system was designed to provide producers with equitable, 
but not necessarily equal, value for their commodities.
    The Kansas City Commodity Office (KCCO) conducts weekly surveys of 
187 counties in major production areas throughout the nation to 
determine if PCP's accurately reflect local market prices. The most 
recent surveys for corn and soybeans were conducted on March 9 and 
included four counties in Wisconsin. In general, the results indicate 
that PCP's in Wisconsin accurately reflect local market conditions for 
these commodities.
    If you have specific questions concerning the PCP for a specific 
commodity or region of Wisconsin, I encourage you to submit your 
comments to the Farm Service Agency for further review.
                   study of dairy prices and the wto
    Question. Section 151 of the Federal Agricultural Improvement Act 
of 1996 calls for a study and report regarding the United States' 
membership in the World Trade Organization and the potential impact of 
such membership on domestic dairy prices, federal dairy programs, and 
other related items. This report was to be provided to the House and 
Senate Agriculture Committees no later than July 1, 1997. Please 
provide information on the status of this report and, if complete, 
would you please provide a copy to this subcommittee?
    Answer. The study referred to was assigned to the Economic Research 
Service (ERS). Unfortunately, the same staff that was working on this 
report was also needed to do economic analysis related to the reform of 
the Milk Marketing Order system. This slowed the progress on the study 
considerably. The analysis for the section 151 study has been completed 
and the report is currently being cleared within USDA. We plan to have 
the report available within the next six months.
                     fsis user fees and farm income
    Question. Please explain if you disagree that any FSIS user fees 
imposed on meat and poultry companies would not be passed on to 
producers. Do you believe the major meat and poultry companies act more 
competitively in their relationship with consumers than with producers? 
If so, please explain? If so, why is there so much concern expressed by 
the Department and elsewhere about concentration within the 
agricultural industry, especially in regard to the livestock sector and 
the effect of concentration on farm prices?
    Answer. We estimate that the impact of the user fees on producers 
in the form of lower prices received would be minimal. We estimate that 
most of the fees will be passed on to consumers in the form of higher 
retail prices. We estimate that the cost will be passed onto consumers 
and consumer demand for meat and poultry is relatively inelastic, so 
this proposal would not have much impact on the market. The overall 
impact on retail prices is estimated to be less than one cent per pound 
of inspected and passed product.
                     emergency forestry assistance
    Question. The fiscal year 1999 Appropriations Act included $10 
million in emergency funding through the Forestry Incentives Program 
(FIP) related to forest fires in Florida and disasters in other states, 
including Wisconsin. What is the status of providing this assistance 
and what plans for distribution of benefits do you intend to use? 
Additionally, what timetable do you envision for delivery of this 
assistance? Since the identified need for Wisconsin is nearly $1.3 
million for disasters in 1998, and since the $10 million provided 
nationally will not cover all identified needs, will the Department 
reflect these shortfalls in emergency funding when making any 
allocation to states based on an appropriation of FIP funding in fiscal 
year 2000?
    Answer. On February 16, 1999, $9 million in Forestry Incentives 
Program (FIP) funds were allocated to 17 States to address 
reforestation needs caused by wildfires and other natural disasters in 
1998. A $1 million reserve is being retained for future assistance, 
primarily tree planting needs, in Florida. USDA's Natural Resources 
Conservation Service (NRCS) and Forest Service, along with State 
foresters, carried out a thorough assessment of needs, which far exceed 
available funds. NRCS intends to closely monitor the use of these 
emergency funds. The Administration's fiscal year 2000 budget currently 
does not request funding for the FIP program in fiscal year 2000.
                               sanctions
    Question. Please provide an update on U.S. negotiations regarding 
the lifting of sanctions against countries such as Cuba and Iran in 
terms of the implications for agriculture. Please provide any 
information relating to the effect the lifting of such sanctions would 
have for U.S. producers.
    Answer. With respect to Cuba, on January 5, 1999, the President 
announced an initiative to enhance U.S. support of the Cuban people and 
to promote a peaceful transition to democracy. As part of this 
initiative, the U.S. is implementing certain ``new measures'' including 
allowing exports of food and certain agricultural commodities to Cuba. 
Exports are limited to non-governmental entities in Cuba so that 
eligible recipients are effectively small ``mom and pop'' shops, 
private farmers and restaurants. While this represents an important 
first step, the immediate impact on the level of exports of agriculture 
products to Cuba is likely not to be great. USDA will continue to work 
with the Commerce Department in drafting the regulations that will 
govern these sales.
    If sanctions on Cuba were lifted, the U.S. could reasonably expect 
to supply about half of Cuba's agricultural imports or about $350 
million, if trade were resumed. According to some analysis, Cuba has 
the potential to become a $1 billion market for U.S. agricultural 
exports (only after substantial investments), making Cuba our second 
largest market in Latin America.
    Regarding Iran, in December the Treasury Department received a 
request for approval of a license to broker a sale of approximately 
$500 million in agriculture exports to Iran. While a sale of this kind 
is currently prohibited under the terms of the comprehensive embargo 
against Iran, the request is being given serious consideration by the 
Administration. USDA is working to ensure that all points of view are 
represented in the decision-making process.
    If sanctions on Iran were lifted, despite heavy competition from 
Australia, Canada and South America, it is not unreasonable to expect 
that U.S. agricultural exports to Iran could reach $300 million per 
year in a relatively short period of time and perhaps twice as much 
within five years. Principle gains for U.S. exports would be in grains 
and oilseed products.
                          assistance to russia
    Question. There have been recent claims that Russia has executed 
sales of wheat to Iraq. Although there appears to be no evidence that 
these sales involved the conveyance of commodities originating in the 
U.S. (notwithstanding the fungibility of commodities such as wheat) 
these allegations do raise serious questions about the role of U.S. 
assistance to Russia. Please provide information that outlines the 
steps the U.S. is taking to ensure that food assistance to Russia is 
actually being delivered to the populations intended.
    Answer. In the agreements with the United States, the Government of 
the Russian Federation agreed to export restrictions on commodities and 
related products supplied as food aid. On January 29, 1999, the 
Government of the Russian Federation published an official decree 
formalizing this agreement. During recent meetings with senior USDA 
officials, Russian Government officials at the highest levels denied 
that Russia sold wheat to Iraq. If further claims surface, the Russian 
Government is committed to addressing the problem or face suspension of 
the food aid programs.
    USDA is mounting an unprecedented real-time monitoring effort to 
ensure that the food assistance provided to Russia is delivered to the 
intended populations and to investigate any irregularities that arise, 
including Russian food exports. As part of the original food aid 
agreements, the Government of the Russian Federation was required to 
submit work plans that provide detailed information about the handling 
and distribution of food aid imports from the United States. These 
documents provide the foundation for the U.S. monitoring effort.
    A working group has been established in Moscow to review the work 
plans, facilitate the operation of the programs and provide a forum to 
address monitoring issues. In addition to the U.S. Government, 
representatives of the key Russian ministries and commercial agents are 
included in monitoring activities.
    Finally, four USDA monitors have been detailed to Moscow and one to 
Vladivostok to ensure, to the extent possible, that the agreements 
between the Governments of the United States and the Russian Federation 
are fulfilled. The team will be headed by the Agricultural Trade 
Officer at the U.S. Embassy. In addition, a ``country team'' approach 
has been adopted by the U.S. Embassy in Moscow so that all U.S. 
Government agencies represented in Russia can support the monitoring 
effort. The USDA monitors will coordinate with the Russian Ministry of 
the Interior in its independent monitoring effort.
    An additional key part of the USDA monitoring plan is to provide 
widespread publicity about the arrival and distribution of food aid in 
the areas where it is destined. By building a grass roots network with 
local government officials, civic organizations and the press, USDA 
will be able to multiply its monitoring effort considerably.
                                pakistan
    Question. Last year, Congress took action relating to sanctions 
against Pakistan in order to help protect U.S. agricultural interests 
in that country. Now, we hear an opportunity exists to provide an 
additional 200,000 tons of wheat to Pakistan, but since that nation is 
in default on GSM loans, that sale (or any other) is in jeopardy. What 
is USDA doing to help protect markets such as this?
    Answer. On March 5, the Government of Pakistan paid a portion of 
their arrears under the GSM-102 program and the program was 
reactivated. However, on March 8 Pakistan purchased 300,000 metric tons 
of Australian white wheat and U.S. exporters were unable to capture any 
business. Although GSM credit has been available for two of the last 
three tenders (including this one), Australia's surprisingly large 
freight advantage this year has put its wheat just under U.S. offers, 
on a landed basis. To assist in protecting our market in Pakistan, USDA 
has donated a total of 300,000 metric tons of wheat under the Section 
416(b) program to Pakistan. The wheat will be shipped this spring. In 
addition, USDA is providing to Pakistan $15 million worth of additional 
wheat and $10 million worth of soybeans under the title I concessional 
sales program.
    Question. To what extent is the Pakistan problem related to the 
general financial pressures in that part of the world?
    Answer. The Asian financial crisis is a contributing factor to 
Pakistan's current financial woes, along with the economic sanctions 
imposed after the nuclear tests in May, and Pakistan's own difficulties 
(lawlessness, corruption) in mobilizing its economy effectively. The 
extent to which financial problems in Asia have affected Pakistan's 
finances in general and its ability to buy U.S. wheat in particular is 
difficult to quantify.
    For example, the value of cotton and textile exports, which 
constitute about two-thirds of Pakistan's $7.5 billion export earnings, 
is down about 15 percent this year compared to last (partly due to 
reduced exports to Far Eastern markets as a result of the economic 
downturn there and partly due to depressed prices in general as a 
result of the global economic situation). At the same time, worker 
remittances (a major source of foreign exchange) have virtually dried 
up since the Government of Pakistan's hard currency bank accounts were 
frozen last May following the nuclear tests.
    Question. How many other trading partners, or potential trading 
partners, are in similar situations?
    Answer. In addition to Pakistan, Russia is also in arrears on GSM 
payments, and, as a result, the GSM program in that country is 
currently not operative. The GSM program in Ecuador was also recently 
closed due to the major financial crisis there. Although GSM credit 
guarantees are currently not available in Russia and Ecuador, USDA has 
maintained a presence in both of these markets by providing extensive 
food aid in fiscal year 1999. As with Pakistan, we will continuously 
review the financial situation in Russia and Ecuador. Should there be 
an improvement in the financial situation in these countries, USDA will 
be prepared to reconsider the availability of GSM.
                     dairy export incentive program
    Question. The fiscal year 2000 budget reflects a decrease in this 
program. Please provide information relating to this program's use in 
fiscal year 1999 and reasons for the projected reduction in 2000.
    Answer. The President's budget assumes that bonus awards under the 
Dairy Export Incentive Program will reach $99 million in 2000, which is 
just slightly below the level of $102 million projected for 1999. 
However, these numbers are only projections of program activity. The 
actual level of DEIP bonus awards in both 1999 and 2000 will be 
determined by market conditions and the Uruguay Round Agreement subsidy 
reduction commitments.
                          banana regime issues
    Question. A February 3rd article in the Journal of Commerce 
discusses the relationship of the current Banana Regime issue with the 
overall economies in the Caribbean Basin and suggests that a U.S. 
victory at the WTO may ultimately cause the U.S. more harm than good. 
Would you please comment on that statement and provide an overview of 
the implications of the Banana Regime issue on U.S. agricultural trade?
    Answer. The issues in the EU Banana regime case ultimately test 
whether the EU will provide access to its market on a fair and non-
discriminatory basis. While the Banana case does not present a 
situation in which U.S. agricultural products are being denied access, 
it does present a situation in which U.S. businesses that supply or 
service agriculture (U.S. farm equipment manufacturers, fertilizer 
producers, marketing firms, etc.) have suffered injury because of 
discriminatory practices. Maintaining the principles of fair access to 
the EU market is an important issue for U.S. agriculture in general.
    The Banana case also tests whether the EU will comply with its 
obligations under the WTO or will ignore the Dispute Settlement Body 
(DSB) Panel rulings. If it ignores the DSB rulings, the benefits of the 
Uruguay Round will be put at risk for all members.
    The United States, and U.S. agriculture in particular, has a strong 
interest in an effective WTO dispute settlement mechanism. Since the 
WTO was established in 1995, the United States has received favorable 
decisions in three agricultural cases and has three other cases pending 
where preliminary findings have supported our positions. In addition, 
the United States has resolved a number of agricultural issues through 
the WTO consultation mechanism without going to a panel.
                              bioterrorism
    Question. Please explain the steps USDA is taking, along with other 
federal agencies, regarding the threat of intentional contamination of 
our food supply as either part of an international terrorism threat or 
any other means.
    Answer. USDA is actively involved in the Administration's overall 
policy initiatives to counter bioterrorism as required under 
Presidential Decision directives 39, 62, 63, and 67. These initiatives 
address prevention, consequence management planning and coordination. 
Currently, the Under Secretary for Food Safety co-chairs the USDA task 
force charged to develop the Department's Continuity of Operations Plan 
(COOP), which is expected to be completed and tested by October of this 
year.
    USDA has organized an intra-departmental Food Emergency Rapid 
Response and Evaluation team to respond to food emergencies, which may 
include some bioterrorism emergencies. This team, headed by the Under 
Secretary for Food Safety at USDA, is a coordinating mechanism for 
strong ties with CDC, FDA, and the state and local public health 
departments working together on the Foodborne Outbreak Response 
Coordination Group. This group has developed a white paper describing 
foodborne outbreak response coordination.
    APHIS has requested $1.2 million in the fiscal year 2000 
President's Budget to develop a national emergency management system to 
meet the needs of emergency disease outbreaks and emerging animal 
health issues including microbiological residues, manure management, 
transmissible spongiform encephalopathies, and biological terrorism. 
Components of the system would include prevention activities such as 
surveillance and a national disease reporting system; preparedness 
activities such as training and the development of response plans; and 
response and-recovery activities. Of the $1.2 million, approximately 
$700,000 would be used to survey for significant animal health events 
including biological terrorism. APHIS would also conduct 4 training 
sessions for Agency and State employees and industry representatives 
regarding biological terrorism, decontamination procedures, and other 
animal health events. The remaining $500,000 would be used to complete 
a master plan for the new system and to develop a National Animal 
Disease Reporting System and Geographical Information System.
    Question. To what extent does the President's Food Safety 
Initiative address this issue?
    Answer. The President's Food Safety Initiative does not include any 
funds for bioterrorism activities. However, the Initiative's emphasis 
on strengthening the public health surveillance infrastructure for 
foodborne diseases would also be important for early detection and 
response to bioterrorist attacks on the food supply. For example, the 
Initiative funds the development of FoodNet active disease surveillance 
efforts and the PulseNet information system to enable Federal and State 
laboratories to rapidly identify and link outbreak cases. This system 
is proving to be an invaluable asset to the early detection of 
naturally caused foodborne outbreaks, and it would also be important in 
detection of an intentional contamination induced outbreak.
                  haccp implementation in small plants
    Question. Please provide information regarding the effect HACCP 
implementation is having on small firms. Since implementation of HACCP 
at the small firm level is very recent, have there been any 
unanticipated problems that should be considered by the Appropriations 
Committee that might not have been known at the time the fiscal year 
2000 budget request was being developed?
    Answer. Approximately 2,200 small establishments were required to 
implement Hazard Analysis and Critical Control Point (HACCP) systems by 
January of this year. At this time we have not encountered any serious 
problems. As of February 24 of this year, only 13 out of 2,211 small 
plants have had FSIS take enforcement action against them for failure 
to fully meet HACCP requirements. All of these plants have provided 
FSIS with corrective action plans and have been approved to continue 
operating. Eight other plants have voluntarily requested that 
inspection be suspended or withdrawn.
    One of the vehicles FSIS uses to monitor HACCP implementation is 
the HACCP Hotline, which is managed by the agency's Technical Service 
Center at Omaha, NE. The HACCP Hotline has identified the following 
items as the principal concerns expressed by owners and operators of 
small plants.
    [The information follows:]
    Inclusion of critical control points for identified food hazards.
    The use of control programs/good manufacturing practices in lieu of 
critical control points.
    The process for completing the pre-shipment review for plants 
supplying products to hotels, restaurants, and institutions
                         pesticide data program
    Question. Please provide information explaining the role of the 
Pesticide Date Program (PDP) within the context of food safety. Also, 
please provide information that directly links the PDP to the 
availability of pesticides for producers, especially for producers of 
minor crops.
    Answer. During fiscal year 1998, EPA used PDP data for the re-
registration of iprodione, thiodicarb and methomyll. During this 
process, EPA reassessed approximately 160 separate toleranes, of which, 
about 60 were tolerances for minor crop uses. In addition, EPA is using 
all available PDP data for the re-registration of organophosphate 
pesticides. For example, EPA is preparing preliminary risk assessments 
for azinphos methyl, methidathion, chlorphyrifos, malathion, diasinon, 
dihlorvos, acephate, dimethoate, disulfoton, ethion, fenamiphos, 
fonofos, ethdamidophos, oxydemeton methyl, parathion, parathion methyl, 
phorate, phosalone, phosphamidon, and tetrahlorvinphos usine PDP data. 
There are approximately 179 food uses covered by these data.
    PDP provides data EPA needs to re-examine pesticide residues in 
food to determine whether a tolerance i.e., maximum allowable 
concentration) is ``safe.'' The term ``safe'' refers to a 
toxicologically determined average daily intake to assure there is a 
reasonable certainty of no harm from dietary exposure to a pesticide. 
EPA gives consideration to the special susceptibilities and food 
consumption patterns of infants and children, and uses available and 
reliable data when making risk determinations. EPA uses PDP data to 
make ``best'' (refined) exposure estimates resulting from pesticide 
residues in foods. Furthermore, because PDP places emphasis on food 
items highly consumed by infants and children, EPA uses PDP data to 
address the special needs of this vulnerable population subgroup.
    PDP also conducts studies (single serving-size portions) 
specifically designed to evaluate acute (short term) exposure to 
organophosphate and N-methylcarbamate pesticides. Data from these 
studies are critical for the re-registration of these chemicals needed 
to sustain minor crops. These data will be used in Monte-Carlo 
analyses, a newly developed technique which has the capability to use 
more realistic data.
    In a related effort, EPA is testing statistical methods using PDP 
single-servicing size data generated for specific high consumption 
foods. These methods will be used to maximize use of PDP data on 
composite (more than one unit in a sample) in order to project acute 
dietary risk for other foods.
    Approximately 88 percent of PDP data collected to date are for 
pesticide residues on minor crops. PDP data are extremely useful in 
retaining pesticide uses for minor crops. PDP data are being 
extensively used in the re-registration of organophosphate pesticides 
needed to sustain minor crops. EPA uses PDP data to replace previously 
used ``worst case'' residue values (e.g., toleranes or farm-date field 
trails to more accurately reflect residues in food near the time of 
consumption.
                            invasive species
    Question. Please provide information relating to potential cost to 
the national economy due to the existing and potential introduction of 
alien species for which USDA has regulatory jurisdiction. In what areas 
of the nation are these problems the most serious?
    Answer. On February 3, 1999, the President announced an Executive 
Order to expand the effort to address the growing environmental and 
economic threat of invasive species. This order establishes an 
interagency Invasive Species Council with the Department's of 
Agriculture, Commerce, and Interior with the Secretaries as co-chairs. 
Experts estimate that invasive species already infest over 100 million 
acres of the United States and is growing at a rate of 3 million acres 
annually. The costs to the U.S. economy are about $123 billion 
annually.
    Question. Is there any way to better protect areas into which these 
species may migrate in the immediate future?
    Answer. The Council will develop a comprehensive plan to minimize 
the economic, ecological, and human health impacts of invasive species 
and determine further steps to prevent the introduction and spread of 
invasive species.
    Question. From a budgetary perspective, keeping in mind the 
constrains on this subcommittee, what are the best strategies to 
control the threat from these pests?
    Answer. The USDA budget includes an increase of $16 million for 
programs to combat invasive species by preventing entry, improving 
monitoring and detection, providing rapid assessment and eradication, 
increasing crosscutting research and technology, and developing 
partnerships directed at education and outreach.
    Question. Please provide information relating to potential cost to 
the national economy due to the existing and potential introduction of 
alien species for which USDA has regulatory jurisdiction. In what areas 
of the nation are these problems the most serious? Is there any way to 
better protect areas into which these species may migrate in the 
immediate future? From a budgetary perspective, keeping in mind the 
constrains on this subcommittee, what are the best strategies to 
control the threat from these pests?
                         organic certification
    Question. Please provide information regarding finalization of the 
Organic Certification program. In which areas of the nation do you 
believe this program will be the most important from both a producer 
and consumer perspective?
    Answer. ASM is in the final stages of issuing another proposed rule 
for organizally-grown food. There were more than 275,000 comments on 
USDA's previous proposed organic standard. We are revising our proposed 
standards, and plan to issue another proposal later this year with 
another public comment. While some areas of the country produce more 
organic product than other, both producers and consumers nationwide 
will benefit from the universal standard that this program will ensure.
                        wetlands reserve program
    Question. Will the expected enrollments in the Wetlands Reserve 
Program (WRP) in fiscal year 2000 bring total enrollments to the fully 
authorized level? In the event the WRP enrollment authorization is met, 
does USDA intend to request additional authorization? If so when and to 
what levels?
    Answer. The requested WRP acreage enrollment level for fiscal year 
2000 will bring the total enrollment to the fully authorized level. 
USDA does intend to request additional authorization once the present 
acreage cap is reached. The request will be contained in the fiscal 
year 2001 budget. The exact level is still under consideration but will 
likely range from up to 200,000 to 250,000 acres per year for the 
period fiscal year 2001 through fiscal year 2006.
    Question. Since many watershed structures are reaching their life 
expectancy, what does USDA plan to do to help avoid continuing 
deterioration of these structures beyond educational activities? To 
what extent does the current status of these structures present a 
threat to public safety? Please explain if you believe the level of 
activity needed to correct the problem of deteriorating infrastructure 
does not rise above the normal maintenance requirement, and thereby 
places the burden of repair solely on local watershed organizations.
    Answer. The issue of the aging watershed infrastructure is a 
growing concern because of potential safety and health risks to the 
public. Between the 1940's and 1960's, local sponsors with the 
assistance of USDA, constructed over 10,000 flood control dams that 
were designed to last 50 years. Many of these dams and others of newer 
design are in a higher hazard classification due downstream development 
and will also require major construction.
    It is our opinion that the sponsors of dams built under the Small 
Watershed Program are responsible for the operations, maintenance, 
rehabilitation as well as compliance with all state and federal laws 
involving dam safety and environmental permits. USDA presently has no 
statutory authority to provide financial assistance for rehabilitation. 
USDA is assessing ideas on how to assist in addressing the problem 
within current authorities.
    USDA/NRCS is currently completing a ``Rapid Assessment of Known 
Rehabilitation Needs'' of dams built under the Small Watershed Program 
in the states of Arkansas, Alabama, Colorado, Georgia, Iowa, Illinois, 
Indiana, Kansas, Kentucky, Missouri, Mississippi, Nebraska, New Mexico, 
New York, Ohio, Oklahoma, Pennsylvania, Tennessee, Texas, Virginia, 
West Virginia and Wisconsin. While this assessment is strictly a 
compilation of known rehabilitation needs, it will provide stakeholders 
valuable information on future direction. Early findings of this 
assessment are being provided for the record.

           RAPID ASSESSMENT OF KNOWN DAM REHABILITATION NEEDS
   [Includes only dams built under PL-534, PL-566, Pilot Projects, and
       Resource Conservation and Development authorities of USDA]
------------------------------------------------------------------------
                                          Number of Dams
                                              Needing     Estimated Cost
                State \1\                    Immediate          \2\
                                          Rehabilitation
------------------------------------------------------------------------
Alabama.................................              71     $24,000,000
Arkansas................................              77      21,000,000
Colorado................................              49      28,000,000
Georgia.................................             129      85,000,000
Illinois................................              36      11,000,000
Indiana.................................              41      14,000,000
Iowa....................................             284      20,000,000
Kansas..................................              97      19,000,000
Kentuky.................................             105      20,000,000
Mississippi.............................              84      31,000,000
Missouri................................             244      21,000,000
Nebraksa................................             294       4,000,000
New Mexico..............................              17      23,000,000
New York................................              49       2,000,000
Ohio....................................              46       7,000,000
Oklahoma................................             190      53,000,000
Pennsylvania............................               7       1,000,000
Tennessee...............................              43      12,000,000
Texas...................................             283      84,000,000
Virginia................................              16      10,000,000
West Virginia...........................              24      54,000,000
Wisconsin...............................              42       3,000,000
                                         -------------------------------
      Totals for these states only......           2,238     547,000,000
------------------------------------------------------------------------
\1\ These 22 states have 10,188 of project dams.
\2\ Does not include Operations and Maintenance costs.
\3\ Caution Preliminary Estimates: Subject to change upon detailed on-
  site assessment.

                 resource conservation and development
    Question. Do you believe Resource Conservation and Development 
(RC&D) districts should be expanded in number or should the areas be 
expanded geographically? Should the RC&D program contain a 
``graduation'' requirement which would allow new districts to come into 
the program as others leave due to either completion of RC&D goals or 
inactivity?
    Answer. At current funding levels, we do not believe Resource 
Conservation and Development (RC&D) Areas should be expanded either in 
number or geographically. Even at these levels, NRCS is finding it 
difficult to meet the basic support needs of the 315 authorized RC&D 
areas. There are 37 areas with applications currently requesting 
designation by the Secretary of Agriculture with an additional 20 
councils being formed.
    Expansion.--RC&D Areas are typically multi-county, many being made 
up of three or more counties. There may be locations where sufficient 
similarities in issues, action priorities and other interests exist 
such that designated areas could be expanded to incorporate all or 
portions of adjacent applicant areas. This would be contingent upon 
local Councils' willingness to adjust their boundaries, council 
membership, priorities, etc., to accommodate the additional counties. 
This will not work everywhere due to geographic distances or other 
similar limiting factors. NRCS State Conservationists will be requested 
to work with their State Associations and RC&D Councils to assess where 
expansion can work and make the necessary adjustments. We expect this 
will be viable in a few locations.
    Graduation.--The RC&D program should only contain a ``graduation'' 
requirement for those RC&D Councils found to be inactive or performing 
below a minimum level. This would be a `de-designation' of an RC&D 
area. USDA, in consultation with the National Association of RC&D 
Councils, Inc. has developed minimum performance criteria for RC&D 
Councils. The 315 existing designated area councils will be requested 
to assess their performance using this criteria this fiscal year and 
identify actions to improve where needed. Inactive or limited 
performance councils would be provided the opportunity to revise their 
area plan and strengthen results. USDA could then determine to withdraw 
assistance if insufficient progress occurs. We think this would be 
rare.
    The concept of ``Graduation'' is inconsistent with the program 
objectives, and the needs of rural communities. Currently, there are 
not any agreed upon measures of ``self sufficiency'' in the 
professional field of rural development, let alone measures that also 
include conservation of natural resources. This is not unique to USDA. 
It is an issue that is endemic to the whole discipline of economic 
development. USDA no longer provides RC&D financial assistance to 
councils as the number of designated areas has increased. In recent 
years, congressional appropriations for the program have declined in 
real dollars. Some councils, no longer receiving financial assistance 
due to budgetary constraints, characterize this as a form of 
graduation. Complete ``Graduation'' would sever the basic partnership 
of the USDA with Councils, providing a disincentive for councils.
    In addition, local partners would be less likely to participate if 
they felt their much of their energy and resources had to go toward 
overhead and administrative costs rather than producing results for 
their communities. One of the key attributes of the RC&D Program is 
that participating organizations see their financial and ``in kind'' 
contributions put to work in local projects.
    The idea of ``graduation'' does not recognize the need of poor 
rural areas to sustain the program over the long term. The strength of 
the program rests in the experienced local delivery network working in 
partnership with USDA to address local, regional, and national 
interests. USDA's technical assistance is viewed as the catalyst for 
providing access to information and technical expertise, leveraging 
other support, and providing continuity for the Council in addressing 
new issues facing their communities.
    A letter has been sent to the Appropriations Committee in response 
to language in the fiscal year 1999 Agriculture Appropriations Bill. 
The letter will provide further information and discussion of actions 
USDA is undertaking to improve the efficiency and effectiveness of the 
RC&D Program.
                    rural housing rental assistance
    Question. The budget request for 2000 would reduce the amount 
available for Rental Assistance, in part by deferring a portion of the 
funds until October 1, 2000. What effect would this action have on 
current tenants of eligible housing facilities and on the USDA housing 
programs generally?
    Answer. This proposal should have no effect on the tenants of our 
rental units. The rental assistance contracts cover a five-year period 
and requesting the funds over a two-year period will have no effect 
either on the owners of the projects or the tenants. Nor should this 
approach have any effect on the housing programs in general.
                        formula research funding
    Question. Formula Research Funding. For the first time in many 
years, Congress in fiscal year 1999 appropriated funding level 
increases for many of the Formula Funded Research Programs, such as the 
Hatch Act, Smith-Lever, and other programs important to states and 
rural areas. However, the fiscal year 2000 budget request, again, calls 
for a significant reduction in these accounts. Please explain the 
rationale for these reductions, the anticipated affect it will have on 
state and county based research and extension activities, and the 
extent to which USDA consulted with its state and local partners in 
this decision.
    Answer. As you know, the Administration supports a balanced 
portfolio of funding for university-based agricultural research 
including formula programs, competitive grants, special grants and 
projects, and other programs such as Smith-Level 3(d).
    Competitive grants are an important mechanism for achieving 
accountability to taxpayers. The Agricultural Research, Extension and 
Education Reform Act of 1998 sets specific standards for federally 
funded agricultural research activities, including activities resulting 
from formula funding programs. Section 101(a) requires that 
agricultural research, extension or education activities address 
priority concerns that are of national, multi-state or regional in 
significance. The legislation also requires the Secretary of 
Agriculture to set research priorities after consulting with persons 
who conduct or use agricultural, research, extension or education and 
that entities receiving formula funds also develop a procedure for 
receiving such input into program development. Competitive grant 
programs provide an opportunity for the Administration to meet that 
statutory obligation to taxpayers. Following extensive consultation 
with stakeholders including the National Research, Extension and 
Education Advisory Board, the land grant university system, and 
producer representatives, the Administration developed a list of 
national agricultural research priorities for fiscal year 2000, 
including food safety, methyl bromide alternatives, small farms, Food 
Quality Protection Act implementation and water quality. Through the 
competitive grants process, the Cooperative State Research, Education, 
and Extension (CSREES) can ensure that scarce federal resources are 
used to address these high priority concerns. States and localities may 
still choose to invest the funds they receive through formula programs 
or other sources to address issues of immediate state and local concern 
as identified through their own stakeholder input process. Since they 
are free to use those funds, as well as the funds they receive from 
formula programs in the manner they choose, the impact of the proposed 
fiscal year 2000 budget will vary from state to state.
    The Administration does not believe that redirecting funds to 
competitive grant programs is at the expense of our land grant 
partners. In fiscal year 1998, land grant colleges and universities 
received approximately 75 percent of the funds awarded under CSREES 
competitive grant programs. If past percentages hold true, the proposed 
$81 million increase in the National Research Initiative in fiscal year 
2000 may result in $61 million in additional research to land grant 
colleges and universities more than offsetting the proposed decrease in 
formula funds and ensuring that federal research, extension and 
education programs meet national priorities. The Administration also 
believes focusing on competitive programs will allow USDA to leverage 
research dollars from other agencies such as NSF, Environment 
Protection Agency, and National Institutes of Health to agricultural 
problems, thereby increasing the funding opportunities for land grant 
partners. A broadly competitive grant program will also ensure that 
scientific expertise from outside the land grant system will be brought 
to bear on agricultural problems, thereby increasing the potential 
return to taxpayers. Through this approach to research funding, the 
Administration believes more resources can be devoted to agricultural 
problems and we can continue to provide our farmers, ranchers and 
consumers with world-class cutting edge research to meet the ever 
increasing array of production, processing and nutritional challenges 
that face them.
    Question. Methyl Bromide. Please provide information regarding USDA 
activities in fiscal year 1999 and in the fiscal year 2000 budget 
relating to methyl bromide alternatives, including your expectations on 
finding an acceptable alternative in the near term, and please note any 
changes in program activities that may have resulted from last year's 
extension of production phase-out from 2000 until 2005.
    Answer. In fiscal year 1999, the Agricultural Research Service 
(ARS) has nearly $14.4 million appropriated for research on methyl 
bromide alternatives. The funds currently are distributed among 20 ARS 
locations (see table below). About half of the funds are in the two 
states that are most impacted by the impending loss of methyl bromide--
California ($4,373,900) and Florida ($3,029,400). The Honolulu, HI, and 
Weslaco, TX, locations, where research on methyl bromide alternatives 
for quarantine purposes is conducted, account for an additional 25 
percent of the funding ($3,167,600). ARS sponsors field-scale 
validations of the most promising alternatives identified in 
experimental plots. Parallel programs are proceeding in Florida and 
California ($250,000 each annually) will emphasis on tomatoes in 
Florida and strawberries in California. Research teams that include ARS 
and university scientists, extension personnel, and grower 
representatives meet periodically to evaluate research results and plan 
future trials. To help transfer the technology to growers, many of the 
field-scale validations are done with active grower participation on 
commercial farms. Such alternatives are being tested at seven 
strawberry sites in California, scattered from just north of San Diego 
to Watsonville and with one site in the Central Valley, to test 
alternatives under a range of growing conditions. There are five sites 
devoted to perennials. In Florida, there are five sites each for 
tomatoes and strawberries. $50,000 of the Florida funds supports 
extension efforts to facilitate adoption of alternatives.

 ARS Funding for Methyl Bromide Alternatives Research--Fiscal Year 1999

Location:
    Davis, CA.................................................  $226,000
    Fresno, CA................................................ 3,485,400
    Riverside, CA.............................................   126,600
    Salinas, CA...............................................   535,900
    Washington, DC............................................   241,200
    Gainesville, FL...........................................   213,000
    Miami, FL................................................. 1,219,300
    Orlando, FL............................................... 1,597,100
    Byron, GA.................................................    83,900
    Tifton, GA................................................   462,200
    Honolulu, HI.............................................. 1,684,700
    Manhattan, KS.............................................    70,800
    Beltsville, MD............................................ 1,048,200
    Stoneville, MS............................................   182,200
    Corvallis, OR.............................................   487,400
    Charleston, SC............................................   330,600
    Weslaco, TX............................................... 1,482,900
    Wenatchee, WA.............................................   209,200
    Yakima, WA................................................   258,000
    Kearneysville, WV.........................................   435,000
                    --------------------------------------------------------------
                    ____________________________________________________

    Total.....................................................14,379,600

    Current budget projections for fiscal year 2000 are similar to 
fiscal year 1999.
    Other USDA agencies with methyl bromide alternatives research 
projects are the Forest Service (FS) and CSREES. In fiscal year 2000, 
an increase of $5 million is provided in the CSREES budget for a new 
integrated competitive grants program to support the discovery and 
implementation of pest management alternatives for commodities most 
affected by the methyl bromide phase-out. The new program will focus on 
short and intermediate-term solutions for commodities at risk. Special 
emphasis will be placed on activities targeting technology transfer of 
research into practical management alternatives. The Forest Service has 
reestablished nursery programs at Athens, Georgia, and St. Paul, 
Minnesota, with the goal of developing integrated pest management 
programs that will ensure high quality seedlings. In the post harvest 
area, the Forest Service, together with the Foreign Agricultural 
Service and the Animal and Plant Health Inspection Service, has been 
successful in negotiations to get U.S. heat-treated coniferous wood 
accepted into Europe and kiln-dried lumber into Korea in lieu of 
fumigation with methyl bromide. The Cooperative State Research, 
Education, and Extension Service, which administers the National 
Research Initiative Competitive Grants Program, has funded research on 
biological control of soil borne disease organisms. ERS is analyzing 
the economic tradeoffs associated with the methyl bromide phase-out, 
which will augment USDA's effort to prioritize an alternatives research 
program.
    An acceptable alternative must allow growers to raise a profitable 
crop reliably from year to year. In the short term, it is clear that 
acceptable alternatives will have to come from among those already 
under development and testing. Because methyl bromide is effective over 
a wide range of soil types, climates, and crops, no single alternative 
is available to replace all the uses. The most likely short-time 
alternatives will be replacement fumigants that are already registered 
but they may have to be augmented with other pesticides such as 
herbicides. Other kinds of alternatives, such as resistant varieties, 
biological control, and cultural improvements, show promise; but there 
is not enough time to develop and adapt them to acceptable cropping 
systems before the phase-out. Even for replacement fumigants, results 
are mixed and not as consistent as methyl bromide--probably why the 
replacements have not been widely adopted as long as methyl bromide is 
available.
    In summary, although there are likely to be short-term replacements 
for some uses of methyl bromide, in most cases, the alternative is 
likely to cost more and be less effective. Among the soil fumigation 
uses, some of the more severe impacts will occur to the production of 
strawberries in California and Florida, orchard crops and nurseries in 
California, and vegetable crops in Florida. Serious economic 
consequences and shifts in agriculture within states and among foreign 
countries are expected.
    The strategy for finding alternatives is not expected to change 
because of the extension of the phase-out; there will just be more time 
to look for solutions. The strategy remains to identify and develop 
alternatives in laboratories and small plots, then test the most 
promising in larger plots under a variety of conditions, and finally to 
select the most effective and validate their effectiveness in 
commercial field-scale settings. The final stages are done with the 
cooperation of the agriculture industries and growers, many times on 
grower land.
    Question. Also, please compare USDA activities in methyl bromide 
research to those of other federal departments or agencies in terms of 
total expenditures and interims of a percentage of the total agency 
budget.
    Answer. Methyl bromide is primarily an agriculture chemical and as 
such the USDA has primary responsibility for finding alternatives for 
those uses. The Agricultural Research Service, the intramural research 
arm of the USDA, has the primary lead within the USDA. The Cooperative 
State Research, Education and Extension Service and the Forest Service 
have small research efforts on methyl bromide alternatives. The 
Economic Research Service conducts research on the impact of the methyl 
bromide phase-out. Research expenditures by agency are summarized in 
the following table.

 
----------------------------------------------------------------------------------------------------------------
                             Agency                                 Fiscal Year       Amount          Percent
----------------------------------------------------------------------------------------------------------------
ARS.............................................................            1999     $14,379,600            1.83
ARS.............................................................            2000      14,379,600            1.72
FS..............................................................            1999         518,000         ( \1\ )
FS..............................................................            2000         508,000         ( \1\ )
ERS.............................................................            1999         200,000         ( \1\ )
ERS.............................................................            2000         200,000         ( \1\ )
CSREES..........................................................            1999         306,000         ( \1\ )
CSREES..........................................................            2000       5,306,000         ( \1\ )
----------------------------------------------------------------------------------------------------------------
\1\ Less than 1 percent.

    The Environmental Protection Agency and the National Oceanic and 
Atmospheric Administration have methyl bromide research programs, 
although the focus of those programs relate to atmospheric ozone 
depletion and the role of methyl bromide in that phenomenon.
    Question. To what extent is USDA working with other departments or 
agencies on methyl bromide research?
    Answer. The USDA and EPA co-sponsor with Methyl Bromide 
Alternatives Outreach, the International Methyl Bromide Alternatives 
Research Conference each year where scientists, growers, exporters and 
other members of the impacted agricultural community discuss the latest 
methyl bromide alternatives technology. Also, the USDA is working 
closely with the EPA Office of Pesticide Programs to identify and 
resolve registration issues that impact the availability of potential 
chemical alternatives to farmers. EPA has agreed to give high priority 
to the registration of methyl bromide alternatives.
                       usda agency administration
    Question. Section 754 of the fiscal year 1999 Appropriations Act 
directed that any submission of unauthorized user fees in the fiscal 
year 2000 budget request before this subcommittee would have to include 
certain additional information if the revenue for those fees was 
necessary to meet the President's budget authority requirements. While 
the budget authority request for FSIS appears to include the full 
amount necessary for inspection and related activities in fiscal year 
2000, the table found on page 379 of the Budget reflects a total 
discretionary requirement for this subcommittee that assumes the $504 
million in proposed revenues from unauthorized user fees for FSIS 
activities. Please list by USDA agency and by amount any assumptions of 
revenues from unauthorized user fees used to achieve the discretionary 
spending total found on page 379 and, consistent with Section 754 
please note the funding levels currently in the budget request 
recommended for reduction in the event the fees in question are not 
authorized prior to the convening of a committee of conference for the 
fiscal year 2000 appropriations bill.
    Answer. For fiscal year 2000 the budget is presented on a current 
law basis and this is the amount that is shown on page 379 of the 
Budget which lists discretionary proposals by appropriations 
subcommittees. Last year the budget was presented on a net basis.
    In addition, the President's statement when he signed the fiscal 
year 1999 appropriations bill said, ``Section 754 of the Agriculture/
Rural Development appropriations section constrains my ability to make 
a particular type of budget recommendation to the Congress. This 
provision would interfere with my constitutional duty under the 
Recommendation Clause, and I will treat it as advisory.''
                  county and state office streamlining
    Question. To what extent are total agency costs in office 
consolidations considered? For example, would USDA require relocation 
of a State office for one agency in order for all State agencies to be 
in a single location if the cost for the relocation exceeded the costs 
of current locations?
    Answer. FSA with NRCS and RD will be establishing a working group 
comprised of representatives from management and the unions to develop 
a plan for implementing office consolidations where these are not 
already in place. The working group will be looking at every aspect of 
plans to achieve savings under current budget resources. It is possible 
that the benefits to producers and field offices of a common State 
office location could outweigh a somewhat higher cost.
                employee reductions and office closures
    Question. Since budget constraints are resulting in lower service 
levels in field offices due to increased workload and a reduced 
workforce, has USDA conducted an evaluation to determine when the 
continuation of a county office in a given location is of less 
importance to the customer than the maintenance of ``service'' in the 
area? At what point does the presence of a workforce in an area become 
more important than the existence of a field office regardless of 
whether that office can meet workload requirements?
    Answer. The Agency is continually monitoring workload in States to 
determine areas of increased workload and moves both human and monetary 
resources to those areas based on availability to provide the most 
effective and efficient service to its customers. State Executive 
Directors have been charged to use all management tools available to 
ensure that producers are served as expeditiously as possible using 
details, directed reassignments of employees, shared management and 
office collocation and consolidation to get the work accomplished. When 
the cost of keeping a service center in operation exceeds the benefit 
of service provided at the counter, States consider closure and 
consolidation of operations to improve efficiency but only with 
Congressional concurrence.
        farm service agency federal and county employment status
    Question. Please provide an update on activities relating to the 
conversion of Farm Service Agency (FSA) county personnel to Federal 
status.
    Answer. No further discussion or action has been taken in 
converting FSA county employees to Federal status. Currently, the 
Secretary is on record as being in favor of this conversion. No 
Congressional action has been taken to enact this proposal. However, on 
October 21, 1998, the President signed Public Law 105-277, which 
contains a section to provide permanent FSA county office committee 
employees with Federal civil service status for only the purpose of 
applying for USDA civil service vacancies.
               farm service agency salaries and expenses
    Question. The fiscal year 2000 request for FSA Salaries and 
Expenses includes an $80 million increase, although that increase does 
not take into account the additional $40 million provided as emergency 
spending in fiscal year 1999 which reduces the actual increase to $40 
million. To what extent has the FSA Salaries and Expenses account been 
supplemented by carryover balances in past years and how much will be 
available in fiscal year 2000?
    Answer. FSA has both Federal offices and non-Federal county 
offices, and the ability to obligate administrative funds for carryover 
workload is authorized by a general provision in each year's 
appropriation act, which is only applicable to the non-Federal county 
offices. Funds obligated for carryover workload expenses are normally 
kept at a minimum. Funds made available to county committees in a 
fiscal year are based on actual and estimated workload and staff year 
requirements according to the FSA County Office Work Measurement and 
Funding Allocation System. Requirements are updated during the year to 
take into account changing conditions. Programs administered by county 
committees are highly volatile in nature and subject to rapid changes. 
Such changes include weather conditions, domestic market prices, export 
sales, legislative and policy changes. Many emergency programs end up 
being quickly administered at mid-fiscal year or late in the fiscal 
year. In a disaster situation the top priority is to furnish a check to 
a farmer or rancher as quickly as possible, so most county offices must 
end up delaying or completing the process of all necessary paperwork 
according to required procedures in order to comply with Agency 
procedures as well as satisfy general and specific audits by OIG and/or 
GAO.
    Obligated carryover in fiscal year 1997 amounted to $63.8 million 
of which $50.8 million was designated for use in fiscal year 1998 and 
$13 million for use in fiscal year 1999. The ending obligated carryover 
for fiscal year 1998 was actually $32.1 million which includes the $13 
million brought forward from fiscal year 1998 and programmed for fiscal 
year 1999. The $32.1 million is for carryover workload expenses to be 
completed in fiscal year 1999. There is currently no expected carryover 
estimate for fiscal year 2000, given 1999 funding enacted.
    Question. To what extent will the $80 million increase described in 
the fiscal year 2000 budget request actually reflect an increase in 
funding available to maintain personnel?
    Answer. The increase is actually $40.5 million. The 1999 funding 
level includes the additional $40 million provided by the emergency 
appropriations title of the 1999 Act. This funding identified as 
administrative support for the emergency programs allowed FSA to 
maintain fiscal year 1998 staffing levels into fiscal year 1999. An 
increase of approximately $40.5 million over the fiscal year 1999 
enacted level is required to sustain critical program delivery, 
including pay costs at a reduced staffing level, offset by some 
decreased operating costs. After adjusting fiscal year 1999 for $32.1 
million in obligated carryover funding, the actual net increase for 
fiscal year 2000 amounts to only $8.4 million. Therefore, the small 
increase in total availability actually requires a decrease in staffing 
because of pay and related costs.
    Question. In what manner does the agency expect to reduce the 
staffing levels to those included in the budget documents by the end of 
fiscal year 2000?
    Answer. Fiscal year 2000 Explanatory Notes reflect a decrease of 
752 staff years in the Federal and non-Federal staffing level, from 
fiscal year 1999 staffing of 16,545 FTE's to fiscal year 2000 staffing 
of 15,793. FSA has no buyouts or RIF's planned for fiscal year 2000. 
The Agency hopes to achieve the 752 decrease in staff years through 
attrition.
    Question. What effect will this have on the administration of 
programs and the level of service afforded customers?
    Answer. Because workload, particularly for marketing assistance 
loans, loan deficiency payments and farm loans, is expected to increase 
in fiscal year 2000, the proposed reduction of 752 staff-years proposed 
will pose a formidable challenge to FSA. The Agency will strive for 
maximum efficiency in program delivery as it continues with its re-
engineering efforts for program and administrative services. But 
ultimately, these reductions will negatively impact program delivery in 
terms of delays in delivering payments to farmers, and in implementing 
emergency and disaster programs across the nation, particularly in 
locations already minimally staffed as a result of previous agency 
downsizing.
                   conservation technical assistance
    Question. To what extent will the restrictions on Commodity Credit 
Corporation (CCC) Section 11 reimbursements affect the administration 
of conservation programs in fiscal year 2000?
    Answer. Section 161 of the 1996 farm bill amended Section 11 of the 
CCC Charter Act to limit the uses of CCC funds for reimbursable 
agreements and transfers and allotments of funds to State and Federal 
agencies. In fiscal year 2000, after adjusting the cap to remove the 
Emerging Markets Program from the base, the total expenditure of CCC 
funds for such uses may not exceed $36.2 million. The budget projects 
obligations under the revised cap for reimbursable agreements will 
total $36.2 million in fiscal year 2000, excluding funding for 
technical assistance for the Wetlands Reserve Program (WRP) and the 
Conservation Reserve Program (CRP). Technical assistance needs in 
fiscal year 2000 for the WRP are estimated to total $18.3 million, with 
$2.0 million provided from unobligated prior year appropriations and 
$9.8 million from funds available under the Section 11 cap, leaving a 
shortfall of $6.5 million. Technical assistance needs in fiscal year 
2000 for the CRP are estimated to total $18.1 million.
    Question. Does USDA plan any action, either administratively or 
through requests to Congress, to correct any serious problem posed by 
the Section 11 limitation?
    Answer. No funds for CRP technical assistance in fiscal year 2000 
are available from unobligated prior year appropriations, no CCC 
funding has been provided for, and we are therefore attempting to 
determine appropriate actions to resolve the funding shortfall.
                         food gleaning savings
    Question. Food gleaning savings. As efforts at food gleaning become 
more successful, will there be any anticipated future savings for USDA 
feeding programs? If so, when might these be realized and to what 
levels might they reach?
    Answer. It is highly unlikely that even a large-scale increase in 
food recovery and gleaning could significantly reduce the need for 
funding for other USDA nutrition assistance programs in the near 
future, particularly given that emergency feeding organizations 
throughout the country are now reporting that they are struggling to 
keep up with a dramatically rising demand for food from families at 
risk of hunger--particularly from working poor families who may not be 
eligible for food stamps.
    A 1998 report by the Second Harvest Food Bank Network indicated 
that approximately 21 million Americans rely on emergency food through 
that network--and many food banks are currently reporting that the 
number of people they are serving is growing, even under the optimal 
economic conditions that now exist. If USDA obtains the $15 million in 
funds requested and reaches the ambitious goal of increasing the amount 
of food recovered and gleaned each year by 33 percent, that would 
provide approximately 500 million additional pounds of food a year, 
which equals roughly three meals a day for 450,000 people. While this 
would be a significant number of people served, it would be less than 3 
percent of the estimated 21 million people served by the current 
emergency feeding system. Thus, USDA anticipates that most of the 
additional food provided under such a scenario would help nonprofit 
feeding organizations meet their increasing need, rather than reducing 
the burden of Federal nutrition assistance programs.
                          advisory committees
    Question. Please provide an update on the status of nominations to 
the USDA Agricultural Policy Advisory Committee (APAC). Wisconsin has a 
candidate that represents the small and medium-sized family dairies 
that are prevalent in the Midwest. What is the Department's status on 
completing those nominations?
    Answer. The charters for the Agricultural Policy Advisory Committee 
for Trade expires April 3, 1999. To ensure continued operations of both 
the committees, it is the Department's intention to recharter all of 
the committees and make the membership appointments no later than the 
end of March, 1999.
                                 ______
                                 
                 Questions Submitted by Senator Durbin
                           food aid programs
    Question. Under Secretary Schumacher, you mentioned using the Food 
Aid Initiative to reduce U.S. wheat surpluses. Beyond what you have 
already done using pork in aid programs to Russia, are there other 
avenues the Department can explore to increase the use of pork and 
other commodities in foreign food aid programs? Possibly to Nicaragua 
or Honduras? Are there any plans for the near future? What tangible 
benefits would this type of aid have on U.S. pork producers?
    Answer. The Department is always vigilant to the possibility of 
helping U.S. pork producers through our food aid programs, as evidenced 
by our donations of pork to Russia. In the case of Nicaragua, Honduras, 
and other Central American countries hit by Hurricane Mitch, we did 
closely examine the possibility of donating live hogs or pork to those 
countries. However, due to a combination of serious logistical problems 
with delivery of these kinds of products to Central America following 
the hurricane, and, for some of the countries, a lack of interest in 
receiving such products, no food aid donations of live hogs or pork 
have been made to those countries this year. Small donations of hogs or 
pork products such as the one that was considered but later rejected 
for Central America could not be expected to have any significant 
impact on U.S. hog or pork prices.
                      conservation reserve program
    Question. The Natural Resources Conservation Service is expected to 
provide an estimated $55-70 million in technical assistance for the 
Conservation Reserve Program, and $11.8 million for the Wetlands 
Reserve Program. Yet, the NRCS could see a shortfall of $50-60 million 
in fiscal year 1999 because of the Section 11 cap in the 1996 Farm 
Bill. Is the Department concerned about the shortfall in funding? What 
is the Department doing to alleviate the shortfall?
    Answer. Yes, the Department is concerned about the shortfall in 
funding because of the impact this would have upon producers accepted 
in the general signup (signup 18), the continuous signup, and the 
Conservation Reserve Enhancement Program. The Department is working to 
resolve the issue.
                                 ______
                                 
                   Questions Submitted by Senator Kyl
                              karnal bunt
    Question. As you know, the report accompanying last years 
appropriations bill directed APHIS to work with the Arizona wheat 
industry and Arizona regulatory agencies to develop a plan for de-
regulation of Karnal bunt in Arizona. The plan was to be submitted to 
the Committee on Appropriations no later than November 15, 1998. I have 
been informed, however, that the plan is still in draft form and is not 
expected to be released until April of this year. This is unacceptable, 
especially in light of the fact that the 1998-99 growing season for 
wheat began at the end of November. Because of this delay, our growers 
are essentially operating in the dark; without a set protocol, growers 
risk planting wheat in a potentially regulated area. Arizona wheat 
growers wish to operate with some certainty and comply with the rules 
and regulations set forth by APHIS, but this is a most difficult task 
when growers haven't even been informed as to what those rules will 
entail. Arizona growers need to know what regulatory actions will be 
taken by APHIS for Karnal bunt prior to the beginning of each growing 
season. Is APHIS willing to publish the planting rules for the 1999-
2000 growing season by no later than December 1, 1999?
    Answer. Yes, we are willing to publish the planting rules for the 
1999-2000 growing season prior to December 1, 1999, and we will strive 
to meet that deadline.
    Question. Pursuant to the fiscal year 1999 appropriations bill, did 
you meet with the representatives of the Arizona wheat industry and 
Arizona regulatory agencies to develop a plan for deregulation? Why or 
why not?
    Answer. Yes, we have met on several occasions with representatives 
of the Arizona wheat industry and Arizona regulatory agencies to 
develop a de-regulation plan. We will meet with them again this spring. 
For the 1999 harvest season, we have published a proposal in the 
Federal Register in which we would greatly reduce the size of the 
existing regulated areas with 3 years of negative survey and allow the 
planting of wheat in plowdown, traceback, and bunted kernel fields. We 
intend for the final rules to be published in time to provide relief 
for the crop that will be harvested in May, June, and July.
    Question. When will this joint plan be submitted to the Committee?
    Answer. We published a proposed rule on our plan on March 9, 1999. 
It became effective upon signature on April 28, 1999, and was published 
as a final rule on May 4, 1999.
    Question. I have also learned that the compensation package for the 
1997-98 growing season was finally published on December 17, 1998, long 
after the wheat harvest had been completed last spring. I have also 
been informed that this package compensates growers at 60 cents per 
bushel and handlers at $1.80 per bushel. Why did it take USDA so long 
to publish this package?
    Answer. We realize that compensation rules have been delayed each 
crop year, and we are trying to improve our timeliness. The delays have 
been in part because we have been attempting to issue a longer term 
compensation package. We were analyzing the benefits of developing a 
longer-term proposal concurrent to our 1997-98 package that would 
provide growers with the information they need well in advance of when 
they must make planting and contracting decisions. In July, we decided 
to table the longer-term proposal for future consideration and propose 
the 1997-98 package by itself. The 1997-98 proposal was published on 
December 17, 1998.
    Question. Why are growers being compensated at only 60 cents per 
bushel when the actual loss per bushel is estimated at $2.00 per 
bushel?
    Answer. Growers and handlers with wheat from the same regulated 
areas are given equivalent compensation rates. The difference in 
compensation rates reflects the fact that affected entities in areas 
under the first regulated crop season would not have known that their 
area was to become regulated for KB when they made planting and 
contracting decisions. Therefore, they would not have considered the 
risk of loss in value of their wheat due to KB. Conversely, growers and 
handlers in previously regulated areas knew they were in a regulated 
area when they made planting and contracting decisions for the 1997-98 
crop season. With this knowledge, growers and handlers could have 
chosen to alter planting or contract decisions to avoid experiencing 
potential losses due to KB.
    Question. The proposed compensation package states that growers and 
handlers could have chosen to alter planting or contract decisions to 
avoid experiencing potential losses due to Karnal bunt. In light of the 
fact that USDA failed to publish the planting rules for the 1998 crop 
in time for the growers to alter planting or contract decision, what is 
the justification behind this statement?
    Answer. Growers and handlers were aware of the regulatory 
boundaries from the rules we published in fiscal year 1996 for the 
1995-96 crop season. Therefore, they were aware of the risks they may 
encounter. In addition, our compensation package for the 1997-98 crop 
season did not increase the regulated area, so growers and handlers 
were not faced with any additional risk. As you know, the report 
accompanying last year's appropriations bill directed APHIS to ``work 
with the Arizona wheat industry and Arizona regulatory agencies to 
develop a plan for de-regulation of karnal bunt in Arizona.'' The plan 
was to be submitted to the Committee on Appropriations no later than 
November 15, 1998. I have been informed, however, that the plan is 
still in draft form and is not expected to be released until April of 
this year. This is unacceptable, especially in light of the fact that 
the 1998-99 growing season for wheat began at the end of November. 
Because of this delay, our growers are essentially operating in the 
dark; without a set protocol, growers risk planting wheat in a 
potentially regulated area. Arizona wheat growers wish to operate with 
some certainty and comply with the rules and regulations set forth by 
APHIS, but this is a most difficult task when growers haven't even been 
informed as to what those rules will entail.

                          SUBCOMMITTEE RECESS

    Senator Cochran. This concludes today's hearing. I want to 
thank you all for appearing before us and providing us with 
answers to our questions and statements that will help us 
understand the budget request and the implications for the 
programs that are administered under these agencies.
    Our next hearing will be on Tuesday, March 16, at 9:30 a.m. 
in this same room, 138 of the Dirksen Senate Office Building. 
At that time, we will hear from witnesses from the Departments 
of Agriculture and Health and Human Services on the topic of 
food safety.
    Until then, this Subcommittee stands in recess.
    [Whereupon, at 11:07 a.m., Tuesday, March 2, the 
Subcommittee was recessed, to reconvene at 9:30 a.m., Tuesday, 
March 16.]


 AGRICULTURAL, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS 
                          FOR FISCAL YEAR 2000

                              ----------                              


                        TUESDAY, MARCH 16, 1999

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met, at 9:35 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Thad Cochran (chairman) presiding.
    Present: Senators Cochran, Kohl, Durbin, Harkin, and 
Dorgan.

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

               Centers for Disease Control and Prevention

STATEMENT OF JEFFREY P. KOPLAN, M.D., DIRECTOR

                            OPENING REMARKS

    Senator Cochran. The subcommittee will please come to 
order. This morning we continue to review the President's 
budget request for programs and activities that come under the 
jurisdiction of our subcommittee. This morning we are 
considering the budget request as it relates to food safety 
activities of the Department of Agriculture and the Department 
of Health and Human Services.
    The witnesses this morning represent the agencies 
responsible for monitoring food preparation and processing to 
make sure that the United States and its citizens continue to 
have the safest food supply in the world.
    One observation at the outset is that the so-called Food 
Safety Initiative has received funding over the past 2 fiscal 
years of $508 million. One issue that I hope we will consider 
is whether or not those funds are being well used, how they are 
being used and coordinated as a part of the Food Safety 
Initiative.
    I hope the witnesses will discuss with us their efforts to 
reduce threats to the public health and to increase the safety 
of our nation's food supply through the implementation of 
inspection systems and the use of technologies and education to 
help promote food safety procedures and safe food handling.
    We welcome this morning Dr. Catherine Woteki, Under 
Secretary for Food Safety at the Department of Agriculture; Dr. 
Jane Henney, Commissioner of the Food and Drug Administration; 
and Dr. Jeffrey Koplan, Director of the Department of Health 
and Human Services' Centers for Disease Control and Prevention.
    Before proceeding to hear your comments, I will be happy to 
yield to my distinguished friend from Wisconsin, the ranking 
Democrat on our subcommittee, Senator Kohl.

                       STATEMENT OF SENATOR KOHL

    Senator Kohl. Thank you, Senator Cochran.
    Our hearing today looks at what is one of the most basic 
responsibilities of government, namely ensuring that the food 
we eat is safe. There is no single constituency for today's 
hearing for everyone eats and everyone expects a healthy and a 
safe food supply.
    We will hear today from agencies, not all of which are 
directly funded through this subcommittee. Secretary Woteki, it 
is good to have you back, and I want to welcome Commissioner 
Henney and wish for you the best in your new role with the Food 
and Drug Administration. Dr. Koplan, I want to especially thank 
you for appearing today. Although the Centers for Disease 
Control and Prevention is funded through the Labor, Health and 
Human Services Subcommittee, your agency plays an important 
role, along with USDA and FDA, in the Food Safety Initiative.
    As is often the case when governmental missions cross 
agency lines, there is the potential for overlap, duplication 
and inefficiencies. One suggested solution is to consolidate 
all food safety activities into a single agency. I find the 
idea of a single agency intriguing, but thoughtful 
consideration needs to be given to consolidating agency 
missions in order to avoid harm.
    The President has proposed a substantial increase for the 
Food Safety Initiative in fiscal year 2000. Providing that full 
increase will not be easy, especially if the money available to 
this subcommittee continues to be reduced. That said, the fact 
that we are dedicating an entire hearing to this topic is 
evidence of our commitment to make certain that federal policy 
priorities and funding for food safety receives proper 
attention.
    We hope today to gain a better understanding of the working 
relationships of the several different agencies at USDA and HHS 
tasked with protection of the food supply. Our end goal is to 
fund a Food Safety Initiative that, in the most efficient and 
effective manner possible, maintains the United States promise 
of providing not only the most abundant food supply in the 
world, but also the safest, for in fact we can afford no less.
    Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator. We appreciate your 
remarks. I also ask that a statement from Senator Burns be 
inserted in the hearing record at this point.
    [The statements follow:]
                  Prepared Statement of Senator Burns
    Thank you Mr. Chairman: I look forward to working with this 
committee and other members of Congress, as well as industry groups to 
improve food safety and ultimately improve consumer perception of the 
safety of agricultural products. American producers carry the 
distinction of producing and distributing the world's safest food 
supply. That they are not recognized as such by our own consumers is a 
situation that must be changed.
    Interagency cooperation will be vital to the development of this 
goal. The National Academy of Sciences (NAS) has found that successful 
integrated operation of a food safety system requires that officials at 
all levels of government work together in support of common goals of a 
science-based system. I believe this is mandatory, as well as complete 
cooperation of industry groups and agricultural producers.
    Additionally, a strong science base is vital to the Food Safety 
Initiative proclaimed by the President. The well-being of consumers and 
American farmers and ranchers alike depends on it. It is of paramount 
importance that science is used as a basis for all reports of 
outbreaks. Countless unfounded reports have leaked into the press and 
hurt agricultural producers immensely.
    E. coli, salmonella and listeria are buzz words for consumers. 
Although numbers of incidences are down, public perception of meat and 
meat products do not appear to have improved significantly. I urge the 
FSIS to work closely with consumer groups, agricultural producers and 
industry groups to reduce consumer distrust of meat products and 
eventually eliminate the threat of food-borne illness.
    This session I have introduced a bill, S251, along with Senators 
Craig, Thomas and Enzi for country-of-origin labeling. Country-of-
origin labeling will assure consumers of the safety of American 
agricultural products. Labeling will protect both the American producer 
and the American consumer. Currently, foreign meat that comes into the 
U.S. is rolled with the USDA grade stamp. This is grossly unfair to the 
producer and consumer alike.
    The USDA stamp on foreign product is a detriment to the producer 
because foreign countries get the benefit of the grade stamp, without 
having to pay for it. America's producers need the protection of 
country of origin labeling to assure that the USDA label really means 
just that---produced in the U.S. It is a detriment to the consumer 
because they deserve to know that they are buying American. They 
deserve to know that they are buying absolutely the safest food supply 
in the world, which is grown by American farmers and ranchers.
    Furthermore, other countries already require labeling of meat and 
meat products. Argentina, Australia, Brazil, Canada and Mexico 
currently require country of origin labeling. The European Union plans 
to do the same by the year 2000. If we are to compete in an 
international market, the U.S. must require the country-of-origin 
label.
    Again, American agriculture provides the American consumer with the 
safest, most reliable source of food and fiber in the world. Consumers 
have proven they want to know where their food comes from. With this in 
mind we then should be informing the American consumer that they really 
are purchasing American product.
    I congratulate you on your timely address of the Y2K issue. I urge 
you to continue to raise awareness of the Y2K problem and the threat it 
may pose to our nation's food supply, as well as to plan to address any 
problems that may occur within the food safety industry. Y2K holds 
special interest to me and I am proud that the state of Montana is well 
ahead of the game in preparing for the potential disaster.
    I am gravely concerned about the issue of imposing user fees for 
inspection of meat, egg and poultry programs. User fees, or a food 
safety tax, such as the one proposed, could hurt the 500,000 workers 
who depend on the economic well- being of the agriculture industry. It 
would lead to a loss of jobs and damage businesses, large and small, 
that depend on the economy of rural America. Agricultural producers are 
struggling to make ends meet. They cannot afford the effects new user 
fees will have on the already depressed market.
    I am also concerned about the implementation of HACCP in the state 
of Montana. HACCP inspections for very small plants are scheduled for 
January 25, 2000. There are about 40 state inspected plants in Montana; 
all of them considered very small by the HACCP inspection standards. 
Most are already above federally inspected standards. Under the FSIS 
(HACCP) program, state inspected plants must meet standards greater 
than or equal to federal standards.
    I am concerned that many of these plants may be put out of business 
if they are subjected to unreasonable regulations that are there only 
for the sake of regulations being in place. I am certainly not 
advocating unsafe practices or creating a potential for contamination. 
What I am advocating is the use of common sense and consideration of 
the livestock folks in Montana, when reviewing HACCP proposals 
submitted by producers subject to the HACCP program.
    I would like to reiterate that we must all work together for an 
effective food safety program. Administrative agencies must learn to 
work more closely and effectively with industry groups, as well as 
producers and consumers, in order to provide effective food safety 
service.
    I would also like to submit for the record questions from the Food 
Marketing Institute and Olson, Frank and Weeda, representatives for 
many food retail establishments

                        STATEMENT OF DR. KOPLAN

    Senator Cochran. We have the witnesses' written statements, 
which we appreciate receiving. We will make them all a part of 
the record in full and urge you to make such summary comments 
or other remarks that you think are appropriate.
    We want to start this morning with Dr. Jeffrey Koplan, who 
is the Director of the Centers for Disease Control and 
Prevention.
    Dr. Koplan.
    Dr. Koplan. Thank you, Senator Cochran. Thank you, Senator 
Kohl.
    Good morning and thank you for the opportunity to speak 
with you.
    CDC monitors the occurrence of human foodborne illness in 
the United States. We work with State and local health 
departments to conduct surveillance of cases of foodborne 
illness and to investigate disease outbreaks. We then use these 
data to identify the factors responsible for illness, so that 
immediate control measures can be taken and longer term 
prevention strategies can be developed in concert with our 
regulatory agencies.
    There are different ways to measure whether these 
strategies have been successful. Others measure success via 
reductions in food contamination. CDC's role in measuring the 
success of interventions is to see whether they translate into 
reductions in the incidence of human cases of foodborne 
illness.
    Although the United States has one of the safest food 
supplies in the world, we continue to face challenges to the 
safety of our foods. New foodborne pathogens are emerging. The 
eating habits of Americans have changed. An increasing 
proportion of our food is imported. New products and processing 
methods are being used, and mass production and distribution of 
foods have the potential to produce diffuse outbreaks. In 
addition, there are more people in groups at high risk for 
foodborne illnesses.
    New challenges require new ways to do our job. Foodborne 
disease is a target area in CDC's recently released plan, 
``Preventing Emerging Infectious Diseases: A strategy for the 
21st century.'' CDC has also been an active partner in the 
National Food Safety Initiative primarily to harness 
information and laboratory technology to propel our nation's 
foodborne disease surveillance system into the 21st century.
    I will provide two examples of CDC's progress in this area. 
First is the foodborne diseases active surveillance network 
called FoodNet, which is a joint effort by CDC, FDA, USDA and 
State health departments, to capture a more accurate picture of 
trends in the occurrence of illness. FoodNet sites canvas 
laboratories and other data sources for illnesses caused by 
nine foodborne pathogens on an active, ongoing basis, using 
standardized data collection methods.
    FoodNet gives high quality data never before available and 
allows determination that any differences across sites are real 
and not due to differing surveillance intensity or 
methodologies. Provisional 1998 data were released last week, 
and the results are encouraging.
    The overall incidence of Salmonella infections decreased 14 
percent between 1996 and 1998. The incidence of the specific 
Salmonella subtype associated with egg contamination declined 
by 44 percent.
    For Camplobacter, the most common bacterial foodborne 
pathogen in the United States, there was an increase of 
incidence between 1996 and 1997, but now we have documented a 
15 percent decline from 1997 to 1998.
    The incidence of infection with the parasite Cyclospora 
decreased to virtually zero after the importation of 
raspberries from Guatemala was suspended.
    Although there may be other explanations for these 
declines, the fact that they were seen across sites suggests 
that we may be seeing a beneficial impact of our prevention 
measures.
    A second system to highlight is PulseNet, a network of 
molecular fingerprinting laboratories at State health 
departments, FDA, USDA and CDC, which enhances the ability of 
laboratory-based surveillance to rapidly identify clusters of 
related foodborne infections of certain pathogens. This system 
uses a methodology known as pulsed-field gel electrophoresis 
(PFGE), where each bacteria and its offspring have a unique 
pattern.
    In 1998, CDC created a national computer database of these 
electrophoresis patterns. Participating labs submit their 
patterns to CDC over the Internet. The computer automatically 
scans previously submitted patterns searching for matches. If a 
match is found, a signal is given to the submitter to initiate 
an investigation to look for a common source. All of this 
happens in real time, allowing the early warning system that we 
all desire.
    The impact of this system, PulseNet, has been enormous, 
both in identifying outbreaks that otherwise would have gone 
undetected and allowing us to better focus our investigations. 
For example, in late 1998, an increased number of cases of 
listeriosis was noticed.
    Using PulseNet technology, CDC tested the strains from 
several States and determined that many had the same 
electrophoresis pattern.
    Epidemiologic investigations found a strong association 
with hot dog consumption in patients with the outbreak strain, 
leading to the recalls which occurred just before Christmas. 
Some strains which were tested were different from the outbreak 
strain but similar to each other, indicating a separate 
outbreak. Investigations found that they were linked to a 
specific imported cheese.
    Other small clusters of cases have been identified and are 
under investigation. If not for the ability to do subtyping, 
these outbreaks would never have been discovered and 
investigated, and prevention measures would never have been 
undertaken.
    CDC plans to devote fiscal year 2000 food safety resources 
to continue to build the national network of labs capable of 
performing this PFGE technology and participating in the 
PulseNet system and to expand the number of different pathogens 
we can identify.
    Other funds will go to expanding the FoodNet system and to 
support our web-based system called DPDx, which harnesses 
telemedicine technology to transmit images of parasites to CDC 
for proper diagnosis from state laboratories. In concert, CDC 
will continue to use emerging infections resources to build 
State health department capacity to conduct appropriate 
epidemiologic investigations.
    In conclusion, these activities represent a small sample of 
how CDC supports its State and local partners and other Federal 
agencies in monitoring, controlling and preventing foodborne 
illness. Foodborne diseases remain a challenge for public 
health.
    To address this challenge will require continued investment 
in our public health infrastructure and strong partnership 
among State and local health departments and Federal agencies.
    I have been away from government and from CDC for the last 
5 years and have just returned. One of the things that has been 
most striking to me is the level of cooperation and the 
increased capabilities that we have in this particular area.
    The level of interchange that my colleagues at USDA and the 
Food and Drug Administration and CDC have on a daily basis is 
much greater than what it was 5 years ago. It is really 
gratifying to see this level of cooperation and partnership.

                           PREPARED STATEMENT

    Thank you for your attention, and I will be happy to answer 
any questions when you have them.
    Senator Cochran. Thank you, Dr. Koplan.
    [The statement follows:]
                Prepared Statement of Jeffrey P. Koplan
    I am Dr. Jeffrey Koplan, Director of the Centers for Disease 
Control and Prevention (CDC). I am accompanied by Dr. Stephen Ostroff 
of the National Center for Infectious Diseases, which is the 
organizational component with lead responsibility for food safety 
issues at CDC. I would like to thank the Committee for the opportunity 
to be here today with my colleagues from the U.S. Department of 
Agriculture (USDA) and the Food and Drug Administration (FDA) to 
describe our Nation's food safety activities.
    Today I will discuss CDC's role in the area of foodborne diseases 
and food safety, including how CDC has used resources obtained through 
the National Food Safety Initiative to strengthen the Nation's ability 
to detect and respond to emerging foodborne disease threats. I will 
also use examples from surveillance reports and from recent outbreak 
investigations to demonstrate how these resources are being applied to 
today's public health practice.
    At its most fundamental level, CDC is the agency that keeps its 
finger on the pulse of the Nation's health. CDC is the cornerstone 
Federal agency for identifying and monitoring foodborne and other 
illness and for documenting the effectiveness of prevention and control 
efforts, including both voluntary and regulatory measures. Using this 
information, we then work to develop ways to improve disease control 
and prevention actions. CDC collaborates with partners ranging from 
State and local health departments, clinical medicine, academic 
centers, industry, other countries, and international organizations. In 
food safety, CDC works in very close coordination with the other 
agencies represented in today's hearing.
    Foodborne and waterborne diseases is a target area in CDC's 
recently released plan, Preventing Emerging Infectious Diseases: A 
Strategy for the 21st Century. Public health priorities in the plan are 
organized under four broad, interdependent goals, each of which can be 
applied specifically to the prevention of foodborne illness: improving 
surveillance and response capacity, addressing applied research 
priorities, repairing the Nation's public health infrastructure and 
training programs, and strengthening prevention and control programs 
required to control emerging, reemerging, and drug-resistant infectious 
diseases. Copies of CDC's plan have been provided to the Subcommittee.
            cdc's role in foodborne diseases and food safety
    CDC plays a critical and unique role as a monitoring, 
investigative, and advisory agency that is separate from regulatory 
agencies, but that works closely with them. CDC monitors the occurrence 
of human foodborne disease in the United States. This includes not only 
traditional public health concerns, such as illness caused by pathogens 
such as Salmonella, but also newer foodborne threats such as E. coli 
O157:H7 and Cyclospora parasites. CDC works with State and local health 
departments to conduct ongoing surveillance of cases of foodborne 
illness and to investigate disease outbreaks, which often provide the 
first clue of new or different threats to the food supply. CDC uses 
both surveillance data and results of outbreak investigations to 
identify the factors responsible for illness so that immediate control 
measures can be taken and longer term prevention strategies can be 
developed. While other agencies measure success of interventions via 
reductions in food contamination, CDC's role in measuring the success 
of interventions is to see whether they translate into reductions in 
the incidence of human cases of foodborne illness. The ultimate test of 
all prevention efforts is whether they prevent human illness.
    Once an outbreak is detected, the first response is usually from 
the State or local health department. Due to limited resources at State 
and local levels, not all outbreaks can be adequately investigated and 
reported. CDC will often be invited by the State health departments to 
participate in the investigation if an outbreak is very large or 
significant, is thought to involve an unusual pathogen or unexpected 
food vehicle, affects multiple states or countries, or when preliminary 
investigations do not reveal a source. When investigating an outbreak 
of a foodborne illness, public health officials must combine laboratory 
diagnostic techniques and epidemiologic investigative methods to 
determine the causative agent of the illness, the food vehicle 
responsible for transmission, and the environmental factors that 
contributed to the outbreak. If a food is identified as the source of 
illness, CDC collaborates with FDA or USDA on the investigation and 
control of the outbreak, based upon which agency regulates the 
suspected food.
    In addition to our surveillance and response activities, CDC also 
conducts applied foodborne illness research. Some examples include 
developing laboratory diagnostic tests where none currently exist, such 
as detection of hepatitis A virus in food and detection of Norwalk-like 
viruses or Cyclospora in clinical specimens and foods; developing 
methods to subtype, or ``fingerprint'', bacteria, viruses, and 
parasites causing foodborne illness; conducting risk factor studies for 
foodborne illness in special populations, such as the 
immunocompromised; and performing cost-effectiveness studies of 
potential prevention measures such as routine use of hepatitis A 
vaccine in food workers.
    The public health infrastructure is the underlying foundation that 
supports the planning, delivery, and evaluation of public health 
activities and practices. CDC's ongoing effort to rebuild the U.S. 
public health infrastructure that addresses infectious diseases is 
critical to improve the capacity of health departments, health care 
delivery organizations, and clinical and public health laboratories to 
detect and report cases of foodborne and other illness and to implement 
prevention and control strategies. Part of this effort includes 
enhancing capacity to respond to disease outbreaks and training public 
health professionals to be able to respond to emerging threats now and 
in the future.
    CDC also engages in educational activities targeted to health care 
professionals and the public. Some examples include producing videos on 
laboratory methods to diagnose foodborne pathogens and materials on how 
to avoid foodborne illness among immunocompromised, high-risk persons. 
CDC actively participates with FDA, USDA, and other Federal agencies, 
industry, and consumer organizations in the Partnership for Food Safety 
Education, an ambitious public-private partnership created to reduce 
the incidence of foodborne illness by educating Americans about safe 
food-handling practices through many activities, including the national 
Fight BAC!TM Campaign. The purpose of the Fight BAC!TM Campaign is to 
help educate consumers about the problem of foodborne illness and 
motivate them to take basic sanitation and food-handling steps that 
will reduce the risk of foodborne illness.
                     the challenges of food safety
    Although the United States has one of the safest food supplies in 
the world, the public health burden of foodborne diseases is still 
substantial, and we continue to face challenges to the safety of our 
foods. New foodborne pathogens are emerging, old foodborne pathogens 
are showing up in new foods, and antimicrobial resistance in foods is 
increasing. The eating habits of Americans have changed. We now consume 
more fresh produce and seafood and demand a constant supply throughout 
the year. Changing food habits can result in a changing pattern of 
foodborne illness. To meet the demand, an ever increasing proportion of 
our food is imported, especially from developing parts of the world. As 
a result, we are being exposed to pathogens not commonly found in the 
United States, as demonstrated by the Cyclospora outbreaks associated 
with raspberries imported from Guatemala. The array of new products and 
processing methods, such as pre-packaged salad mixes, presents another 
challenge, as does mass production and distribution of foods, which has 
the potential to produce diffuse, nationwide illness outbreaks of 
unprecedented scale.
    New challenges require new, creative ways to do our job more 
effectively and efficiently. The President's National Food Safety 
Initiative, launched in 1997, recognizes this need and is moving our 
food safety system forward. CDC has been an active partner in the 
development and implementation of the Food Safety Initiative. Our 
resources under this initiative have primarily been targeted to 
harnessing the information and laboratory technology revolution to 
propel our Nation's foodborne disease surveillance system into the 21st 
century.
                                foodnet
    I will provide two examples of CDC's progress in this area. First 
is the Foodborne Diseases Active Surveillance Network (FoodNet). The 
FoodNet system is a joint effort by CDC, FDA, USDA, and State health 
departments to capture a more accurate and complete picture of trends 
in the occurrence of illness caused by priority foodborne pathogens. It 
is built on the foundation of CDC's emerging infectious disease 
activities, which provides the basic infrastructure to conduct active 
disease surveillance. Before 1996, the Nation's foodborne disease 
surveillance system was based on passive reports of illness from 
clinicians and laboratories which were submitted to local health 
departments and then onward to the State health department and from the 
State to CDC. Such information lacks timeliness, is often incomplete, 
and is highly variable from one place to the next depending on the 
resources invested at the state and local level.
    FoodNet is part of CDC's Emerging Infections Programs (EIP's). CDC 
funds EIP cooperative agreements with State and local health 
departments to conduct population-based surveillance and research that 
go beyond the routine functions of health departments. In these sites, 
the program, which usually involves a partnership between the State 
health department and an academic center, canvasses laboratories and 
other data sources for illnesses caused by seven different pathogens on 
an active, ongoing basis using standardized data collection methods, 
standard definitions, and standard techniques. Each case is reviewed 
and strains are collected and analyzed. Special case-control studies 
are conducted across FoodNet sites in order to identify the major risk 
factors for sporadic illness, and community surveys are conducted to 
help determine the overall burden of foodborne illness, which include 
mild illnesses which do not come to medical attention or patients who 
do not have diagnostic testing performed. Data are electronically 
submitted to CDC for collation with rapid turnaround. FoodNet gives 
high quality data never before available and also allows determination 
that any differences across sites are real and not due to differing 
surveillance intensity or methodology.
    As a demonstration of how rapidly these data can be analyzed and 
disseminated, provisional 1998 data was released on March 11, 1999, in 
CDC's Morbidity and Mortality Weekly Report. The results are very 
encouraging. For the five original FoodNet sites which have been 
collecting data since 1996, the incidence of Salmonella infections 
declined 13 percent between 1996 and 1998. For Salmonella Enteritidis 
(SE), the Salmonella subtype associated with egg contamination which 
became a major problem in the 1980s, the decline was especially 
pronounced. Between 1996 and 1998, the incidence of SE in FoodNet sites 
declined by 44 percent. For Campylobacter, the most common bacterial 
foodborne pathogen in the United States, there was an increase in 
incidence between 1996 and 1997, but now we have documented a 15 
percent decline from 1997 to 1998. The incidence of infection with the 
parasite Cyclospora decreased to virtually zero after the importation 
of raspberries from Guatemala was suspended. These provisional data use 
1997 census estimates. When 1998 census estimates are available later 
this year, these 1998 rates will be recalculated and are likely to be 
slightly lower due to population increases. Although there may be other 
explanations for these impressive declines, the fact that they were 
seen across sites suggests they are not surveillance artifacts and may 
be an indication that prevention measures being implemented by USDA and 
FDA are working.
                                pulsenet
    A second system to highlight is PulseNet, a system developed in 
partnership with State health departments and the Association of Public 
Health Laboratories. PulseNet is a network of molecular subtyping 
(fingerprinting) laboratories at State health departments, FDA, USDA, 
and CDC, which enhances the ability of laboratory-based surveillance to 
rapidly identify clusters of related foodborne infections of certain 
pathogens, sometimes scattered over large geographic areas. This system 
uses a methodology known as Pulsed Field Gel Electrophoresis (PFGE) to 
digest bacterial DNA into fragments which can be run on gels to produce 
unique patterns. Like human fingerprints, each bacteria and its 
offspring have a unique PFGE pattern. If two bacteria are found with an 
indistinguishable pattern, it is likely that they have a common source, 
meaning they may be part of an outbreak of many similar cases. CDC has 
standardized PFGE methodology for E. coli O157:H7 and for Salmonella. 
Last fall CDC standardized PFGE methodology for Listeria, not long 
before there was a multi-state outbreak of listeriosis associated with 
contaminated hot dogs. Using funds from CDC's Epidemiology and 
Laboratory Capacity (ELC) cooperative agreements and from the Food 
Safety Initiative, state health laboratories have obtained PFGE 
equipment, and CDC has provided training and standardized methodology 
to them to test for foodborne pathogens. USDA and FDA laboratories also 
participate in the network to allow comparison between animal, food, 
and human isolates. By the end of 1999, 33 laboratories will be linked 
into this network. Eventually, CDC hopes to include all state 
laboratories.
    To enhance the power of the PulseNet system, in 1998, CDC created a 
national computer database of PFGE patterns that is housed at CDC. Now 
states can submit PFGE patterns to the database over the Internet. The 
computer then automatically scans previously submitted patterns 
searching for matches. If a match is found, a signal is given to the 
submitter that duplicate patterns are present and where they came from, 
so that an investigation can begin to look for a common source. All of 
this happens in real time, allowing the early warning system for 
nascent outbreaks that we all desire.
    The impact of PulseNet has been enormous, both in identifying 
outbreaks that would otherwise have gone unnoticed, and in allowing us 
to focus our investigations to determine the true source and extent of 
an outbreak. For example in late 1998, an increased number of cases of 
listeriosis were noticed. Using PulseNet technology, CDC tested the 
strains from several states and determined that many had the same PFGE 
pattern. Epidemiologic investigations found a strong association with 
hot dog consumption in patients with the outbreak strain, leading to 
recalls which occurred just before Christmas. Since then, CDC has 
continued to work with states to test all available Listeria isolates 
from patients since last summer, in order to determine how many cases 
and deaths occurred as part of the outbreak and to confirm that the 
outbreak is over. As of late February, a total of 97 outbreak-
associated cases have been identified in 22 states with 14 fatalities 
and 6 still births.
    Some of the strains which were tested were different from the 
outbreak strain. Among these a second cluster of strains with a common 
PFGE pattern was found. Investigation of these cases found they were 
linked to consumption of a specific imported cheese. Other small 
clusters of cases have been identified and are under investigation. If 
not for the ability to do the subtyping, these outbreaks never would 
have been discovered and investigated, and prevention measures would 
not have been undertaken.
    Another PulseNet example involves Shigella, a bacterial pathogen 
that can be foodborne but most often is not. The Minnesota Department 
of Health, a FoodNet site, routinely fingerprints its Shigella 
isolates, and last summer they identified a cluster of strains with a 
similar pattern. Epidemiologic investigations found that illness was 
linked to eating chopped parsley in two different restaurants. By 
informing other states and searching databases for places with an 
increased number of cases, similar outbreaks were identified in five 
other states and Canada. The Shigella from these outbreaks also had the 
same PFGE fingerprint. All of the outbreaks were parsley associated. 
Working with FDA, the implicated parsley was traced to production 
fields in Mexico. Again, if not for routine utilization of PFGE, the 
links between the outbreaks would have been missed, the source would 
not have been identified, and the outbreak would have spread much 
further.
    PFGE is a powerful tool. It allows us to detect widely dispersed 
outbreaks and small clusters that would have previously been missed. 
This illustrates a central tenet of epidemiology: better surveillance 
leads to better and more accurate disease detection, which in turn 
leads to more investigations. This causes increased burdens, not only 
on CDC and other Federal agencies, but also on state and local 
partners.
    Therefore, as surveillance improves, more outbreaks, not fewer, 
will be detected. However, this should not be interpreted as a failure. 
Rather, it represents success, because only by finding and 
investigating the outbreaks can we define risks, develop and implement 
interventions, and over the long term target and ultimately eliminate 
the risk.
       national food safety initiative at cdc in fiscal year 2000
    CDC is committed to continuing to build a sensitive, timely, and 
accurate public health infrastructure for the Nation. To this end, the 
President's request for CDC for fiscal year 2000 National Food Safety 
Initiative is $10,000,000 above the fiscal year 1999 appropriation of 
$19,476,000. CDC plans to devote these resources to continue to build 
the national network of labs capable of performing PFGE technology and 
participating in the PulseNet system. We will increase the number of 
pathogens monitored in the system in order to detect additional 
outbreaks. Other funds will go to expanding the FoodNet system and 
adding surveillance components for viral gastroenteritis. In the 
future, we hope to expand and incorporate subtyping methods for viral 
agents and to support the development of subtyping methods for 
Cyclospora and Cryptosporidium, parasitic agents for which subtyping is 
not sufficiently developed. And finally we will continue to support a 
system known as DPDx, which harnesses telemedicine technology to 
transmit images of parasites under the microscope to our experts at CDC 
for appropriate diagnosis. In concert, CDC will continue to use 
emerging infections resources to build State health department capacity 
to conduct appropriate epidemiologic investigations.
                              conclusions
    In conclusion, these activities represent a small sample of how CDC 
supports its state and local partners and other Federal agencies in 
monitoring, controlling, and preventing foodborne illness. Foodborne 
diseases remain a challenge for public health. To address this 
challenge will require continued investments in our public health 
infrastructure and strong partnerships among State and local health 
departments and Federal agencies.
    Thank you for the opportunity to discuss the surveillance of 
foodborne disease. We will be happy to answer questions you or other 
members of the Subcommittee may have.
                      Food and Drug Administration

STATEMENT OF DR. JANE HENNEY, COMMISSIONER
    Senator Cochran. Dr. Henney, we will now hear from you.
    Dr. Henney. Good morning, Mr. Chairman, members of the 
committee. I appreciate the opportunity to address you today, 
and thank you for your interest in this very important area of 
food safety.
    The Food and Drug Administration has been entrusted with 
ensuring the safety of the majority of the food supply since 
the passage of the first Food and Drug Act of 1906. Throughout 
the 20th century, we have fulfilled our obligation to protect 
the public from unsafe foods by relying on a strong scientific 
basis for our regulatory approach.
    As our scientific knowledge has developed, so, too, have 
our regulations evolved to reflect the current state of 
knowledge. As we move toward the 21st century, we must remain 
dedicated to strengthening the science base throughout the 
agency. It is my strong conviction that through the development 
and application of sound scientific principles, we will solve 
the numerous public health threats posed by an ever-changing 
world.
    This is particularly true in the area of food safety. While 
our food supply is, in general, safe, our citizens are more at 
risk from food today than they have been in many years.
    First, the food we eat in this country has changed 
drastically from a diet of meat, potatoes and locally grown 
seasonal produce, to today when we are eating a much greater 
variety of food, such as seafood, fresh fruits and vegetables. 
And these foods are often transported over long distances, both 
domestically and internationally. And they are available to us 
throughout the year. The combination of the new sources and 
wide distribution of food poses new safety challenges for the 
public.
    Second, we are eating more food prepared by others. We have 
gone from the past, when most meals were prepared in the home, 
to today, when 50 cents of every food dollar is spent on food 
prepared outside the home. This food includes ready-to-eat 
foods from restaurants and supermarkets.
    There are also a large number of Americans who have their 
meals prepared and served in hospitals, nursing homes, day care 
and senior centers.
    Third, there has been an increase in the number of people 
considered to be at-risk for foodborne illness. Today nearly 25 
percent of people in the United States fall in this category: 
the elderly, children, pregnant women, the immuno-compromised.
    Moreover, the size of the vulnerable population is growing, 
particularly with our senior population being the fastest-
growing sector of our society.
    Last and most important, more resistant old and more deadly 
new pathogens have emerged in our food supply. With respect to 
the latter, we are aware of five times the number of foodborne 
pathogens in 1999 than we were just 50 years ago, the most 
notorious of which is E. Coli O157:H7.
    As a result of these changes, outbreaks of foodborne 
illness are now all too prevalent. They seem to occur every 
day, everywhere, in almost any food. And we are identifying 
more and more outbreaks associated with FDA-regulated products: 
apple juice, eggs, sprouts, raspberries, even toasted oat 
cereal, a product not generally regarded as high risk.
    While the number of deaths and illnesses associated with 
food have been the source of great debate, virtually all 
experts believe that many foodborne illnesses are preventable. 
Therefore, we have a public health responsibility to do what we 
can to minimize them.
    The Administration's Food Safety Initiative was first 
announced in January 1997 and further enhanced in October 1998 
to provide special emphasis to help ensure the safety of 
imported and domestic fruits and vegetables. The goal set forth 
in this initiative could not be accomplished without additional 
resources. And your support through prior years' appropriations 
has been crucial to our success.
    We have completed virtually all of the activities funded by 
the $24 million you provided in the first year of the 
initiative and are well along toward meeting our goals for this 
year's funding.
    We are now asking you for $30 million for fiscal year 2000 
that can make a real difference in building the infrastructure 
the Nation needs to effectively combat foodborne illness.
    My written submission for the record contains details of 
those accomplishments and plans, Mr. Chairman. But let me give 
you just a few highlights today.
    In the area of prevention, we have implemented state-of-
the-art HACCP controls for seafood that will ensure its safe 
processing. We have developed agricultural and manufacturing 
guidance for fresh fruits and vegetables that gives farmers and 
processors the latest information on how to protect those foods 
from contamination.
    And we have established a national anti-microbial 
resistance monitoring system that is intended to give us the 
ability to detect emerging pathogens that threaten human 
health.
    Moreover, we are rapidly improving our ability to identify 
foodborne illness when it does occur, track it to its source 
and prevent further illness. For imported foods, we are 
increasing our surveillance at the border and helping foreign 
producers better understand how they can prevent contaminated 
food from being sent to us.
    With the additional funding that we are requesting for next 
year, we will begin, for the first time in many, many years, to 
inspect high-risk food processors at least once a year. We will 
increase our collaborations with States who share with us the 
responsibility to inspect these firms.
    We will utilize the new DNA technology that promises to 
revolutionize our ability to respond to foodborne illness. And 
we will launch a serious effort to improve the safety of food 
at the retail level.
    In closing, let me just say that our food safety efforts to 
date have taught us many lessons. One of the most important is 
that FDA cannot solve this problem on its own. We must work 
together with other Federal agencies, such as CDC, USDA, EPA, 
as well as our important counterparts in the States to 
accomplish our goal of a truly coordinated and effective food 
safety net based in sound science.
    In our efforts, we must remember our public health 
responsibility. As we continue to work with States and other 
Federal agencies, the standard for food safety in this country 
must remain a high one. The public demands it. The science is 
developing to allow it. And we must keep pace, or we will have 
failed to meet our public duty.
    Although we cannot anticipate every food safety problem 
before it happens, we must make sure that we have a strong 
science-based food safety system in place that can minimize the 
harm to public health. Our budget request for fiscal year 2000 
will give us the resources we need to meet the challenge we 
will face into the next century.

                           PREPARED STATEMENT

    I thank you for your time, and I will be pleased to answer 
any questions you may have.
    [The statement follows:]
                   Prepared Statement of Jane Henney
    Mr. Chairman, senators, ladies and gentlemen, I appeared before the 
Senate last year to ask you to consider me for a position in public 
service. Today I am honored to address you as the Commissioner of the 
Food and Drug Administration. I thank you and your colleagues who saw 
fit to entrust me with this office.
    During that process, I promised the Senate that I would make food 
safety a high priority if I was confirmed as FDA Commissioner. It is my 
privilege today to begin to deliver on that promise by presenting the 
highlights of the Agency's food safety accomplishments for fiscal 1998, 
the plans for fiscal year 1999, and the expectations for food safety as 
reflected in the Administration's proposed budget for fiscal year 2000.
                          food safety problem
    The Food and Drug Administration began as a science-based consumer 
protection agency nearly 100 years ago with a food safety issue. A 
chemist in the Bureau of Chemistry at the Department of Agriculture, 
Harvey Wiley, was concerned that chemical additives used as 
preservatives in a time when refrigeration was in its infancy were a 
danger to the public health. Called the ``crusading chemist,'' his 
experiments on additives such as borax and formaldehyde found his 
original concerns to be valid and culminated in passage of the Pure 
Food and Drugs Act in 1906. Harvey Wiley, as you may know, was 
ultimately designated the first Commissioner of the Food and Drug 
Administration.
    The food safety challenges that face FDA and other food safety 
agencies today may be different that those that Harvey Wiley confronted 
but they are no less challenging or compelling.
    What people eat has changed. We are no longer a nation of meat and 
potato eaters only, but a people who are eating a greater variety of 
foods, particularly seafood and fresh fruit and vegetables. This is 
great for our nutrition but offers greater food safety challenges. When 
consumers are demanding these foods year round, safety issues 
surrounding transportation and refrigeration become an increasing 
problem. And as trade barriers break down, new challenges for ensuring 
the safety of the imported food arise.
    Where people eat has changed. People are eating more of their meals 
away from home. In fact, fifty cents of every food dollar is spent on 
food prepared outside the home. This food is purchased not only from 
grocery stores and restaurants, but also is consumed in institutional 
settings such as hospitals, nursing homes and day care centers. The 
result is that as more food workers become involved in preparing our 
meals, both the chances for disease-producing errors and the regulatory 
responsibility of assuring food safety increases.
    Who's eating is also changing. Nearly a quarter of the population 
is at higher risk for foodborne illness. This includes pregnant women, 
children, the elderly, and the immunocompromised. The size of the 
vulnerable population is growing, with aging babyboomers and increased 
longevity.
    All are important--different foods, more foods prepared outside the 
home, and increased vulnerable populations--but there's another 
important element in our changing world, the emergence of many new 
foodborne pathogens. We are aware of more than five times the number of 
foodborne pathogens in 1999 than we were in 1942. Many of these 
pathogens can be deadly, especially for people at highest risk.
    As a result, outbreaks of foodborne illness are now all too 
prevalent. They happen frequently, in all regions of the country, and 
in every type of food. And we are identifying more and more outbreaks 
associated with FDA regulated products. Therefore, as the world of food 
changes, we must be sure that the food safety system changes along with 
it, identifying new solutions to today's problems.
                 the president's food safety initiative
    Recognizing the increasing risks to the food safety system, on 
January 25, 1997, the President announced a Food Safety Initiative to 
reduce the incidence of foodborne illness to the greatest extent 
possible. Four months later, recommendations for the President were 
delivered in a report entitled ``Food Safety: From Farm to Table.'' 
This report outlined the steps the federal government would take in the 
short and long term to achieve that goal. The Food Safety Initiative 
was enhanced by President Clinton on October 2, 1998 to provide special 
emphasis on ensuring the safety of imported and domestic fruits and 
vegetables. FDA has a central role in the Administration's efforts.
A Strong Science Base Is Critical
    As critical as it was in Harvey Wiley's time, it is just as 
critical today to the food safety system that it be grounded in a 
strong scientific foundation. Equally important is that we have a 
strong, scientifically skilled workforce to conduct the President's 
Food Safety Initiative. We rely on and therefore must support the 
scientific work of those entrusted with carrying out FSI 
responsibilities at every step along the farm to table continuum. We 
must invest in enhancing and maintaining scientific excellence to 
ensure that we have the best possible data for decision-making at both 
the policy and implementation level.
    A recent outbreak of Salmonella Agona in breakfast cereal 
illustrates the importance of a scientific basis to public health. In 
the spring of 1998, 20 states reported an increase in Salmonella Agona 
infections. There were 409 cases of illnesses reported. Over 102 people 
were hospitalized and one person died. Through molecular fingerprinting 
(DNA) technology we were able to link the bacteria from the food and 
from the patients. The bacteria was subsequently traced to one 
manufacturer who produced the cereal under a variety of labels. 
Ultimately 2 million pounds of Toasted Oat cereal was recalled.
    Already, FDA has made the following scientific contributions under 
the FSI:
Prevention Programs
    Developed a science-based hazard analysis critical control point 
(HACCP) regulatory program for seafood to prevent foodborne illness. 
This includes extensive training for our inspectors so they provide a 
knowledgeable oversight role.
    Developed technology to eliminate or inactivate microbial 
contaminates by the use of high hydrostatic pressure techniques. This 
technique has been shown to inactivate a number of different pathogens 
in packages of fluid products while retaining the products' sensory 
characteristics, and provides an alternative pastuerizing technology in 
some situations for which thermal pasteurization and irradiation are 
less desirable.
    Initiated research to prevent contamination of unpasteurized juice 
by assessing the effectiveness of different antimicrobial technologies 
in an actual cider mill.
    Initiated research on safe sprout production at sprout production 
facilities constructed at the National Center for Food Safety and 
Technology (Moffett Center) in Chicago, operated in partnership with 
Illinois Institute of Technology. This research will evaluate the 
effectiveness of intervention strategies such as sanitizing agents to 
prevent contamination of sprouts with pathogens.
Surveillance and Outbreak Response
    Developed a comprehensive, coordinated national foodborne illness 
outbreak response system in collaboration with CDC and USDA among 
federal, state and local agencies.
    The National Antimicrobial Resistance Monitoring System (NARMS) has 
allowed us to increase our ability to detect emerging pathogens and 
identify relationships between animal and human foodborne isolates. 
NARMS isolates provide a pool of organisms to research for rapid tests 
for identification of foodborne pathogens for salmonella type.
Detection Methods
    Developed through a collaboration between federal, state, and local 
agencies, an improved technique to detect directly and quantify harmful 
Escherichia coli within 30 minutes, compared to 24 to 48 hours using 
conventional techniques. This pathogen was responsible for outbreaks of 
food-related illness in young children after they drank unpasteurized 
apple juice.
    Developed a rapid, sensitive and reliable method capable of 
detecting low levels of Norwalk viruses in contaminated shellfish.
    I would endeavor to have a strong science base throughout the Food 
Safety Initiative.
Federal Partnerships
    As you can see, many of these programs have joined FDA and its 
Federal partners in successful collaboration to protect the public 
health. Further examples include: development of an interagency Risk 
Assessment Consortium to coordinate priorities of risk-assessment 
research, such as the Listeria risk assessment currently underway that 
involves both USDA and FDA regulated products; the signing of a 
memorandum of understanding to create the Foodborne Outbreak Response 
Coordinating Group (FORC-G) to enhance coordination of resources and 
expertise during an outbreak and prepare for new and emerging threats 
to the food supply; collaboration between FDA and USDA with CDC on 
funding, protocol development, and priority setting for FoodNet; 
multiagency collaborations on the National Advisory Committee on 
Microbiological Criteria for Foods to achieve food safety advice of the 
highest scientific standards for all federal agencies involved in food 
safety; and the development of a Joint Institute for Food Safety 
Research (JIFSR) which allows for the joint funding and coordination of 
priority research projects.
Federal-State Partnerships
    An integrated federal-state partnership makes sense as well from an 
effective use of resources perspective and provides the greatest level 
of public health protection. I strongly support such partnerships. For 
this approach to work, we need: strong federal standards; training and 
certification for all inspectors; shared databases; federal oversight 
of state activities; and effective enforcement and surveillance. The 
need for increased inspection coverage is sufficiently large that we 
will need an increased federal inspection force, and also need more 
qualified state and local counterparts.
    Our work and cooperation with the States is central to our success 
in these endeavors. Currently, FDA is leading an effort to integrate 
federal, state and local food safety systems for FDA-regulated 
products. This work began in September 1998 in Kansas City with an FDA-
hosted meeting of food safety and agriculture officials from all 50 
states, Puerto Rico, and the District of Columbia, epidemiologists from 
state and local health departments, and colleagues from CDC and USDA. 
The focus of the meeting was to find a way for local, state, and 
federal food safety and public health agencies to share resources and 
work together to make the U.S. food supply safer than ever. Discussions 
centered around joint planning opportunities for increased inspections, 
linking data and communication systems, and improving government 
response to outbreaks.
    Tasks of integrating the nation's food safety systems has now been 
divided into working groups of local, state and federal health 
officials. The reports from these working groups will be made available 
for public comment later this spring. We estimate that it will take 5-
10 years to build this national system and it will require resources to 
enhance state and local capabilities.
                     fiscal year 1998 achievements
    In fiscal year 1998, FDA received its first additional 
appropriation of $24 million under the initiative. The Agency used 
these funds to begin to set the foundation for creating a state-of-the-
art science-based food safety system.
    This system focuses on combating foodborne illness on two major 
strategic fronts. The first is the development of prevention 
strategies, programs that will keep bacteria out of the food, 
throughout the food chain, from farm to table. These prevention 
programs are supported by education and verification--by educating 
producers, processors, food preparers, and consumers in how to use 
prevention techniques correctly, and by verifying, through inspections 
at business establishments, that the prevention techniques are, indeed, 
being applied properly. The second front is the early detection and 
containment of foodborne hazards during an outbreak. In addition to 
limiting the extent of the outbreak, we must seek the cause and provide 
a ``feedback loop'' of information that helps strengthen our prevention 
programs.
    Virtually all the goals promised for the first year in the May 1997 
Farm-to-Table Report were achieved. I would like to highlight some of 
them for you.
Prevention, Education, and Verification
    Prevention is the key to reducing foodborne illness. A major focus 
of our prevention strategy for food safety was the implementation of a 
HACCP (Hazard Analysis Critical Control Points) program for seafood. 
HACCP is a science-based system in which a food producer identifies the 
hazards associated with its particular product, and then puts 
appropriate controls in place to prevent, reduce, or eliminate the 
hazard. Through a combination of FDA inspection and state contracts, 
all domestic seafood processors and importers were inspected to verify 
implementation of HACCP by the end of calendar year 1998.
    We have expanded our prevention strategies by proposing HACCP 
regulations for juice. We also are working with small juice and cider 
producers to further our juice safety goals. And, together with USDA, 
we have launched a multi-pronged initiative to prevent illness caused 
by Salmonella contamination of raw eggs.
    We have worked on prevention strategies involving produce as well. 
FDA and USDA held a series of public meetings with the agricultural 
community and conducted site visits to growing and packing areas to 
elicit detailed information on common problems involved in the 
production of safe produce. These meetings were held as background for 
the development of a guidance document for growers, packers and 
shippers of fresh fruits and vegetables, which provides information on 
agricultural and management practices that may enhance the safety of 
fresh produce. We were very pleased with the way the final guidance was 
accepted by industry. In fact, the final guidance won the endorsement 
of United Fresh Fruits and Vegetable Association, a large national 
trade organization.
    In recent months, we approved the use of chlorine dioxide as an 
antimicrobial agent for use in produce processing, and published a 
policy under which we will expedite the review of food additives that 
would make predictable contributions to preventing or reducing pathogen 
contamination of foods.
    Food safety education campaigns, soundly based in science, can 
reach large numbers of commercial and home food preparers with 
information on safe food handling practices that can prevent food 
contamination and reduce pathogen growth. Food safety education is 
another part of FDA's strategy to protect consumers from foodborne 
hazards. These activities, often sponsored in conjunction with other 
federal agencies, states and professional associations, provide a cost-
effective means to preventing processing, preparation, handling and 
storage practices that could cause food to become contaminated with 
dangerous levels of microorganisms or other substances that could cause 
illnesses.
    Education activities in fiscal year 1998 included work in 
conjunction with USDA and CDC with the Partnership for Food Safety 
Education's ``FIGHT BAC!'' campaign. Extensive educational efforts were 
undertaken through the media and through community-based education 
programs for food handlers both in retail settings and in the home. FDA 
field offices across the country also launched educational efforts to 
help average citizens prevent food-related illnesses.
    An education program was also started for health professionals. FDA 
and CDC signed an agreement with the American Medical Association to 
develop a program to educate physicians and their patients on foodborne 
disease.
               early detection and containment of hazards
    Responding to emerging pathogens in the food supply quickly and 
effectively is essential to preventing widespread illness. FDA 
scientists in the Center for Veterinary Medicine and the National 
Center for Toxicological Research are adapting for use in the United 
States an assay for detecting bovine DNA in feed to protect us against 
occurrence of imported ``Mad Cow'' disease in the United States.
    We are convinced that this focus on detection and containment has 
had a significant, beneficial public health impact. For example, 
information gathered through field investigations supported by the 
Administration's Food Safety Initiative linked Guatemalan raspberries 
to cyclosporiasis; outbreaks in 1996 and 1997 caused about 2,500 cases 
of cyclosporiasis in this country. This past year, no Guatemalan 
raspberries were imported to the U.S., and no cases of cyclosporiasis 
were linked to raspberries. In contrast, Canada imported Guatemalan 
raspberries last summer and continued to suffer raspberry- associated 
outbreaks of Cyclospora infections. We estimate that our preventive 
actions avoided 1,200-1,500 Cyclospora infections for the American 
public and saved $2.8 to $3.5 million in health- care costs. We are 
continuing to work with Guatemala to permit future importation of 
raspberries without importing foodborne hazards.
    I would also like to raise with you a food safety issue that is 
likely to have major public health implications: antibiotic resistance. 
We know that antimicrobial resistance (the resistance of disease-
causing bacteria to drug treatment) can develop in some organisms when 
food animals are treated with certain drugs. We also know that this 
resistant pathogen can be transferred on food and infect humans. This 
drug resistant infection may cause disease in people consuming the 
animal derived food product and result in infections that are resistant 
to treatment potentially increasing the costs and risks associated with 
the infection. Increasing antibiotic resistance and loss of the 
effectiveness of antimicrobials is an emerging public health threat 
world-wide. We are taking several actions to combat this threat. FDA 
and USDA have established a nationwide surveillance system to identify 
and track developing antimicrobial drug resistance in food-producing 
animals. FDA is also collaborating with CDC and USDA to study 
resistance by tracking the emergence of resistant pathogens and 
developing scientifically sound mitigation and intervention strategies 
to prevent the development of resistance. FDA also plans to conduct 
research into the mechanisms of resistance, their dissemination and the 
risk factors associated with resistant human infections. We must 
continue to develop our scientific understanding of antibiotic 
resistance and take action to ensure that effective drugs remain 
available to treat infections in humans and animals.
    I have only touched on the many FDA accomplishments for fiscal year 
1998. A more complete listing is available in a First Year Report, 
FDA's Accomplishments on the President's Food Safety Initiative, which 
I will submit for the record.
                         fiscal year 1999 plans
    Added funds for fiscal year 1999 allow FDA to focus on imports as 
well as on domestic and international education and outreach on the 
good agricultural practices guidance. In fiscal year 1999 we will also 
give further emphasis to seafood HACCP and antibiotic resistance 
monitoring.
Imports
    On the premise that the safety of imported foods can be better 
enhanced where the foods are produced rather than at the U.S. border, 
FDA has undertaken not only to strengthen our border surveillance 
activities, but also to design new programs to prevent contamination in 
countries that export to the U.S. We are assessing foreign controls 
over food products exported to the U.S. and are providing technical 
assistance to foreign countries. We also will conduct foreign 
inspections of food establishments that produce food products at high 
risk for microbial contamination and conventional surveillance of 
imported food products at our borders will be increased. When foodborne 
illness outbreaks associated with imported foods occur, we will conduct 
follow up investigations in the exporting countries. I will submit for 
the record a more detailed plan of our fiscal year 1999 food safety 
import plan.
    Last year, as you are aware, the Administration put forward a bill 
that would have expanded FDA's authority over imported foods (S.1707/
H.R.3052). That bill raised many questions and concerns in Congress and 
as you know, ultimately did not succeed. The President recently 
reaffirmed his commitment to providing FDA with enhanced authority over 
imported foods. I want to assure you that the Agency heard and 
understands the questions and concerns, and I want to work with you to 
find the right solution to provide FDA with the tools necessary to 
improve the safety of imported foods.
Good Agricultural Practices Guidance
    FDA will work with USDA to provide information and education on the 
Good Agricultural Practices guidance developed in 1998. Fresh fruit and 
vegetable growers may use this guidance to reduce the risk that their 
products will become contaminated with pathogens. Technical assistance 
and education programs are now under development for the domestic and 
international produce industry to improve the safety of fresh produce 
available to U.S. consumers.
Seafood HACCP
    FDA continues to implement seafood HACCP during fiscal year 1999 by 
conducting the second year of annual inspections of domestic seafood 
processors. The first year's inspections focused on providing 
processors with clear feedback on the status of their new HACCP 
systems. They were designed to be educational as long as a critical 
public health hazard was not found. In the last year, FDA found a range 
of problems with HACCP implementation that needed to be addressed by 
seafood facilities. Our goal is to see that HACCP is being more fully 
implemented in a larger proportion of the industry by the end of 
calendar year 1999. I will submit for the record our plan for 
strengthening the safety of seafood in this, our second year, of 
seafood HACCP implementation.
Antimicrobial Resistance
    In order to assure detection of emerging resistance trends in 
pathogenic bacteria, we are planning to expand our program to increase 
the information in the National Antimicrobial Resistance Monitoring 
System. The collection and analysis of this data will improve our 
ability to detect changes in antimicrobial resistance patterns and 
identify trends at the local level. The identification of trends helps 
us target our research. For example, we are now looking at how the use 
of multiple drugs and multiple exposure to the drugs affect the 
development of antimicrobial resistance. We are also looking at how 
drugs are administered to determine if the route of administration 
affects the development of antimicrobial resistance.
                    fiscal year 2000 budget request
    As a result of funding provided in fiscal year 1998 and fiscal year 
1999, a solid, science-based infrastructure is being developed to 
improve food safety and reduce the risk of foodborne illness, for both 
domestic and imported foods.
    The President's fiscal year 2000 budget request for FSI includes a 
$30 million increase for FDA that further builds this science base and 
expands capabilities in surveillance and containment of foodborne 
outbreaks. The additional resources will be targeted to develop further 
a nationally integrated food safety system, and provide greater 
emphasis on the control of foodborne hazards in the post-harvest phase 
of the farm-to-table continuum.
Expand Inspections
    In fiscal year 2000 we will focus on increasing our domestic 
inspection coverage. Inspection and compliance efforts will be expanded 
during fiscal year 2000 with additional emphasis on the frequency of 
inspection of domestic firms producing food that is at high risk of 
microbiological contamination or high risk of causing severe disease. 
There are a total of 6250 such firms. Inspection of these firms will 
increase to a schedule of once per year by 2001. By ``high risk'' we 
mean, in addition to seafood: infant formula, certain ready-to-eat 
foods that are not processed or only minimally processed--e.g., by 
heating, freezing, washing--before consumption; heat and serve 
products; and low-acid canned foods and acidified foods. fiscal year 
2000 resources would be applied both to increasing Federal FDA 
inspections as well as increasing inspections by our state and local 
partners according to federal standards. We also will more than double 
the number of foreign inspections we conduct for these same types of 
products.
Enhance Surveillance and Investigation to Improve Outbreak Response
    Funding in fiscal year 1998 and fiscal year 1999 expanded public 
health surveillance efforts, resulting in improved outbreak detection. 
Since it is anticipated that there will be an increase in the number of 
outbreaks detected, FDA must continue expansion of foodborne outbreak 
response and traceback activities. To that end, we need a rapid 
response capability directed to foodborne outbreaks. We need to 
increase the links between CDC surveillance and epidemiology and FDA 
response team, as well as between FDA laboratories and CDC's PulseNet 
pathogen subtyping system. This rapid response team will enable early 
containment of hazards, and will provide a feedback tool on new causes 
of outbreaks to promote development of new preventive controls.
Food Safety at the Retail Level
    An additional focus for fiscal year 2000 will be on strengthening 
Federal and State partnerships regarding retail food safety. I 
mentioned at the beginning of my statement that American consumers are 
increasingly eating food prepared outside their homes. That factor in 
itself may not seem significant. CDC data, however, clearly demonstrate 
the substantial occurrence of foodborne disease outbreaks in retail 
settings. FDA will work with its state partners to lower that risk. 
Reducing outbreaks associated with food service operations is a 
significant challenge. To appreciate the magnitude of the problem, I 
should point out that there are approximately 750,000 restaurants and 
37,000 institutional food service operations in the U.S.
    FDA will work with states and the food industry to develop and 
implement food production and preventive control systems. In 
particular, FDA will encourage the states to adopt the 1999 Food Code, 
a model code developed by FDA in collaboration with state officials. 
FDA will provide training to state and local officials as well as 
education to the private sector regarding safe food handling practices.
Accelerate Food Safety Research
    Research will be conducted to expand methods development and 
prevention technology research during fiscal year 2000. FDA will 
collaborate with other agencies and the private sector to translate 
preventive technologies and techniques into appropriate versions for 
use by small industry and consumers. FDA, along with CDC and USDA, will 
expand mechanisms to transfer technologies to States, small and large 
industry, foreign governments, consumers, and others.
    The National Center for Food Safety and Technology (Moffett Center) 
and the Joint Institute for Food Safety and Applied Nutrition (JIFSAN) 
are key components of FDA's efforts to achieve established food safety 
objectives. These partnerships with academia and industry allow for 
more efficient use of public and private research resources and enhance 
the quality of food safety and public health policy. The additional 
resources requested for fiscal year 2000 will permit FDA to expand risk 
assessment efforts at JIFSAN and the Moffett Center to fill the 
critical gaps in exposure assessment of foodborne hazards. This 
expanded risk assessment research effort will enhance FDA's ability to 
characterize more rapidly and accurately the nature and size of the 
risk to human health associated with foodborne hazards, as well as the 
effects of intervention. More rapid and accurate risk assessment 
techniques are critical to providing consumers greater protection 
against potential hazards posed by foodborne pathogens. This research 
compliments efforts underway at CFSAN, CVM, and the National Center for 
Toxicological Research (NCTR).
Antimicrobial Resistance
    In fiscal year 2000, we will continue to improve and expand our 
National Antimicrobial Resistance Monitoring System including expanding 
the geographical scope and supporting international efforts to develop 
a global resistance database. We will conduct epidemiology studies to 
evaluate management, production and drug use practices in food animals 
to determine how such practices influence the development of 
antimicrobial resistance. We will get additional information from 
collaborative efforts with other government agencies, academic 
institutions, and producer groups in order to develop education 
material related to proper drug use. We will work with State and local 
authorities to develop effective educational program.
                               conclusion
    Mr. Chairman, all of us testifying today--FDA, the U.S. Department 
of Agriculture and the Centers for Disease Control and Prevention--as 
well as other federal agencies, state and local government officials, 
and agriculture, industry and consumer representatives, have key roles 
to play in the effort to reduce the incidence of foodborne illness. 
This effort has been a highlight of the President's Food Safety 
Initiative. All the partnering agencies' and organizations' programs 
need a base in science and a focus on public health. We also need open 
communication between federal, state, and local governments, the 
industry, and consumers. Working together, we can ensure the safety of 
the nation's food supply.

                          SUBMITTED QUESTIONS

    Senator Cochran. Thank you, Dr. Henney.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted by Senator Cochran
    Question. What is the incidence of foodborne illness in the United 
States? Has it increased over the last 10 years? Over the last five 
years? Over the last year?
    USDA answer. Estimates of the magnitude of foodborne illness in the 
United States have been imprecise. To quantify, better understand, and 
more precisely monitor foodborne illness, since 1996 the Foodborne 
Diseases Active Surveillance Network (FoodNet) has collected data to 
monitor nine foodborne diseases in selected U.S. sites. The overall 
incidence of the foodborne illnesses under surveillance from 1996 to 
1998 declined, particularly for salmonelllosis and campylobacteriosis, 
and the data continued to demonstrate regional and seasonal differences 
in the reported incidence of diseases. Over this 3-year period, the 
largest decrease in bacterial pathogen-specific rates occurred in cases 
of infection caused by Salmonella (14.5 per 100,000 population in 1996 
to 12.4 per 100,000 population in 1998, a 14 per cent decline).
    Each year, millions of persons experience foodborne illness, though 
only a fraction seeks medical care and an even smaller number submit 
laboratory specimens. FoodNet provides a precise measure of the 
laboratory-diagnosed cases of specific foodborne illnesses and performs 
additional surveys and studies to interpret trends over time. The 1998 
Food Net data indicate a decline in several of the major bacterial and 
parasitic causes of foodborne illness. These declines might in part 
reflect annual fluctuations in the incidence of foodborne illnesses and 
temporal variations in diagnostic practices. The trends also may 
reflect implementation of disease prevention efforts. The declines in 
salmonellosis and campylobacteriosis may reflect changes in meat and 
poultry processing plants in the United States mandated by the Pathogen 
reduction and Hazard Analysis and Critical control Points (HACCP) final 
rule. The decline from 1996 to 1998 in the incidence of salmonellosis 
parallels the reported decline in the percentage of meat and poultry 
products tested at large, federally inspected processing plants that 
were positive for Salmonella.
    FDA answer. Estimates of foodborne illness are wide-ranging, and 
the true magnitude of foodborne illness remains illusive. In 1994, the 
Council for Agricultural Science and Technology (CAST) estimated the 
incidence of symptomatic illness at 6.5 million cases annually, with 
about 9,000 related deaths. CDC has undertaken a broad-based, multi-
disciplinary effort to update estimates of foodborne illness using the 
best available information. CDC anticipates that the revised estimates 
will be available for public review within the next few months. 
Substantial future efforts will be required to further improve 
estimates of the burden of illness caused by certain bacterial, 
parasitic, and viral foodborne pathogens.
    Question. What percent of foodborne illness is attributed to the 
processing of foods versus consumer food handling?
    FDA answer. CDC and FDA do not know of reliable data to determine 
the percent of foodborne illness attributed to the processing of foods 
versus consumer handling of food. However, the current data indicate 
that we need to do more to prevent foodborne disease, both by making 
food safer and by improving commercial and home food preparation 
practices. To reduce the frequency of foodborne diseases, improvements 
need to be made throughout the food supply--reduce the prevalence of 
pathogens on farms, decrease the contamination of foods during 
processing, and improve food handling practices in restaurants and 
homes.Most food-borne illness have traditionally been attributed to 
food prepared in the home, although, most outbreaks have been reported 
from food prepared at the retail level. This apparent inconsistency is 
the result of bias in traditional foodborne illness surveillance 
program. The Foodborne Diseases Active Surveillance Network, FoodNet, 
established under the Food Safety Initiative, was developed in part to 
provide a more accurate estimate of where, contamination and other food 
preparation errors that lead to food-borne illnesses are occurring.
    Question. With the use of HACCP, USDA officials have noted a sharp 
decline in Salmonella contamination of meat and poultry. However, more 
than a third of ground turkey is still tainted. Why?
    USDA answer. The prevalence of Salmonella in the FSIS nationwide 
raw ground turkey microbiological survey--conducted during January 
through March 1995 and September through November 1995--was 49.9 
percent. The Post-HACCP implementation, January 26, 1998--January 25, 
1999, Salmonella prevalence for raw ground turkey produced in large 
plants was 36.4 percent. Thus, there has been a decline in Salmonella 
contamination on raw ground turkey since the implementation of HACCP. 
Ground meat and poultry products tend to have a higher Salmonella 
prevalence than carcasses, because they are prepared from numerous 
carcasses.
    Question. There have been increasing numbers of recalls in the 
United States involving cooked, ready-to-eat products and Listeria. 
What are the concerns about this and what is being done about this 
problem?
    USDA answer. FSIS has undertaken an aggressive strategy to decrease 
the risks from Listeria on ready-to-eat products. This strategy 
includes: developing guidance to industry on ``best practices'' that 
can help to reduce the potential of product contamination; targeting 
consumer education for high-risk groups; initiating a study to address 
developing policy guidance on industry responsibility to address 
Listeria under HACCP in ready-to-eat product at retail; and, conducting 
a quantitative risk assessment for Listeria that will determine the 
foods that pose the greatest risk to consumers and specific 
subpopulations at increased risk of contracting listeriosis. We have 
also improved the sensitivity of test methods to better detect 
contaminated product.
    FDA answer. The public health concern is that processed meats and 
ready-to-eat products continue to contain Listeria, and as a result are 
a persistent source of infection and death among susceptible persons. 
CDC is developing new molecular subtyping systems for Listeria 
monocytogenes, conducting foodborne disease surveillance, and studying 
listeriosis in several states to help measure the impact of prevention 
activities and recognize trends in disease occurrence. Early detection 
and reporting of outbreaks of listeriosis to local and state health 
departments can help identify sources of infection and prevent more 
cases of the disease. Thus, CDC assists State health departments in 
investigating outbreaks. CDC is working to educate consumers, 
especially those in high risk groups, about listeriosis risk associated 
with certain foods. In addition, CDC is working with regulatory 
agencies on prevention strategies, such as post-packaging 
pasteurization of high risk foods.
    FDA has contributed to efforts to decrease response time to 
outbreaks of listeriosis and other harmful pathogens. Specifically, FDA 
has helped fund the CDC, surveillance for listeriosis for many years. 
Since 1995, FDA, CDC, and the U.S. Department of Agriculture, or USDA, 
have been working with cooperating state and local health departments 
on active surveillance for foodborne illness, including listeriosis, 
through the Foodborne Diseases Active Surveillance Network, which is 
commonly referred to as FoodNet. Additional funding through the Food 
Safety Initiative has increased FoodNet effort, by including more 
active sites and additional pathogens, and has allowed more case 
control studies for outbreaks of listeriosis to be included. Such 
studies are important in determining which are the most at-risk 
individuals, actual incidence, foods implicated, and numbers of 
Listeria monocytogenes organisms in implicated foods.
    FDA and CDC cooperate with USDA and public health laboratories in 
PulseNet, the National Molecular Subtyping Network for Foodborne 
Disease Surveillance, to perform ``fingerprint'' comparisons on 
bacteria that may be foodborne. Such analyses help identify molecular 
subtypes of bacteria and identify common food source outbreaks. 
PulseNet is now operational for E. coli O157: H7. Salmonella serotype 
Typhimurium was added in 1998. PulseNet techniques are used for some 
outbreaks and clusters of listeriosis. The next proposed organism for 
50 state harmonization is Listeria monocytogenes.
    In May 1997, the President announced the comprehensive Food Safety 
Initiative to improve the safety of the nation's food Supply. 
Prominently included in this initiative are measures to improve 
surveillance and outbreak response. Following the announcement, The 
Foodborne Outbreak Response Coordinating Group, also known as FORC-G, 
was formed, bringing together FDA with other federal, state, and local 
agencies to develop a comprehensive, coordinated, national foodborne 
illness outbreak response system. Early detection and reporting of 
outbreaks of listeriosis to local and state health departments can help 
identify sources or infection and prevent more cases of the disease.
    In the summer of 1998, FDA began developing a charge to a task 
force to perform a risk assessment of the public health impact of 
foodborne Listeria monocytogenes. The risk assessment formally began in 
1999. The objectives of the risk assessment are to identify low vs. 
high risk foods, the characteristics high risk food have in common, and 
the role of shelf life; the numbers of Listeria monocytogenes organisms 
consumed, both routinely and when illness results; and knowledge of 
dose-response relationship, especially in the at-risk populations. The 
goal is to provide as complete a description as possible of current 
knowledge of the sources and quantity of Listeria monocytogenes 
consumed and of the health consequences to the populations that consume 
these microorganisms. Information from the risk assessment should help 
to both decrease response time and help to educate consumers, industry, 
and health professionals.
    FDA has also contributed to the prevention of future outbreaks. 
Listeriamonocytogenes education has been directed especially to the 
most at-risk populations such as pregnant women and people with AIDS, 
and distributed through brochures placed in physicians' offices and by 
FDA Public Affairs Specialists and through educational videos on 
foodborne illness prevention, including Listeria monocytogenes and 
listeriosis. The target population also includes food service managers 
and workers and nursing home medical directors and administrators. The 
general public has been targeted through periodic news releases from 
FDA's press office; articles published in the FDA Consumer in 1987, 
1988, and 1991 and through the FDA web site, with additional links to 
related web sites including the USDA Food Safety and Inspection Service 
and the CDC. ``Research on Listeria monocytogenes'' was published in 
the FDA Drug Bulletin I 1987 and distributed to over one million health 
professionals.
    The Foodborne Pathogenic Microorganisms and Natural Toxins 
Handbook, also known as the ``Bad Bug Book'', has been publicly 
available since 1994 through the CFSAN web site. This handbook contains 
information on Listeria monocytogenes and listeriosis that is 
supplemented with up-to-date information through links to current 
research articles and surveillance reports. The ``Bad Bug Book'' is one 
of the most popular sites at the CFSAN web site, and is consulted by 
consumers, industry, and other government agencies, both here and 
abroad.
    The most recently available data on cases of listeriosis reported 
to CDC, included in the Healthy People Review, 1998-1999 National 
Center for Health Statistics, show a reduction and leveling off in the 
numbers of cases of listeriosis. This includes sporadic and outbreak 
cases. Reduction achievements between 1989 and 1993 were attributed to 
industry, regulatory and educational efforts.
    I will be happy to provide a chart with this data for the record.
    [The information follows:]

                  Cases of Listeriosis reported to CDC

                                                     Cases per 1 million
        1Year                                            U.S. Population
1987..............................................................   7.0
1990..............................................................   7.7
1991..............................................................   6.1
1992..............................................................   4.5
1993..............................................................   4.4
1994..............................................................   4.2
1996.............................................................\1\ 5.0
1997.............................................................\1\ 5.0

\1\ FoodNet data based on Active Surveillance at selected sites
---------------------------------------------------------------------------
    Question. In late February of this year, the press reported that 
USDA and FDA agreed to share information about inspections, recalls, 
and outbreaks of foodborne diseases. Was this report accurate, that the 
agencies had not been sharing such information before this time? If 
true, why?
    USDA answer. The press reports on the recently agreed upon 
memorandum of understanding (MOU) between FSIS and FDA may not have 
been completely accurate. The MOU deals mainly with sharing information 
about inspections and findings at dual jurisdiction establishments. 
FSIS historically has shared, and continues to share, data about 
recalls and outbreaks of foodborne illness with FDA. Neither FDA nor 
FSIS will disclose to each other confidential or trade secret 
information.
    FDA answer. No, the press report was not accurate. The two agencies 
have been sharing information for some time now. On August 8, 1979, FDA 
and USDA entered into a Memorandum of Understand, or MOU, that 
formalized the exchange of information on inspections. In June of 1981, 
this MOU was amended in order to take into consideration the provisions 
of the Infant Formula Act. In 1983, a revised MOU outlined several 
expanded areas of cooperation and sharing of inspection information.
    In February of this year, the agencies reevaluated the previous 
MOU, updated that agreement, and entered into a newly signed agreement 
on coordination of inspectional efforts. The new agreement will 
facilitate the exchange of information at the field level about food 
establishments and operations that are subject to the jurisdiction of 
both agencies. Field offices will notify their counterparts of food 
safety recalls, instances of product contamination and mislabeling, and 
conditions at facilities that could result in unsafe or unwholesome 
food.
    In a May 1997 Report to the President entitled ``Food Safety From 
Farm to Table-A National Food-Safety Initiative,'' the agencies 
primarily responsible for food safety, made several recommendations to 
improve public health protection from foodborne illness, including 
increasing cooperation among agencies, and more specifically, of 
ensuring that FDA and USDA/FSIS use the resources and experience of as 
efficiently as possible to avoid duplication of efforts. The President 
accepted the report and directed the Agencies to implement the report's 
recommendations to improve the efficiency and effectiveness of the food 
safety system in this country.
    Question. Do organic foods pose any greater risk than other foods?
    USDA answer. We are not aware of any scientific evidence comparing 
the relative health risks of organic foods versus non-organic foods 
that would indicate that organic foods pose a greater health risk to 
the consumer.
    FDA answer. FDA has no data to suggest that foods identified as 
organic pose a greater or lesser risk than foods that are 
conventionally grown or manufactured. To a large degree, potential 
microbial food safety hazards, and their control, apply to both organic 
and non-organic food operations. In the production of fresh fruits and 
vegetables, for example, all growers need to ensure agricultural water 
quality is adequate and take appropriate steps such as run-off controls 
to maintain water quality. Most factors, such as available water 
source, are more likely to be dictated by regional or other factors 
than by whether a grower is organic. Likewise, sanitary facilities need 
to be clean and easily accessible. Workers in the field and 
packinghouse need to be aware of and follow appropriate sanitary and 
hygienic practices. Some practices, such as the use of manure as a 
fertilizer, have been identified as practices that need to be closely 
monitored to reduce the risk of microbial contamination. To the extent 
that organic and non-organic producers employ such practices, 
appropriate Good Agricultural or GAPs and Good Manufacturing Practices 
or GMPs should be followed to limit the potential for contamination.
    Question. Is the expansion of FoodNet complete?
    USDA answer. No, several states plan to add counties to the 
catchment area in fiscal year 2000. A ninth site may be considered in 
the future to enhance geographic representation. In 1998, the FoodNet 
catchment area included 20.5 million persons, based on 1997 estimates, 
which represents 7.7 percent of the U.S. population. In 1999, the 
catchment area will include approximately 30 million persons based on 
1997 estimates, with Georgia initiating statewide surveillance and New 
York adding counties to its catchment area.
    FDA answer. CDC does not anticipate adding additional states as 
FoodNet sites at this time. However, CDC does intend to enhance 
surveillance and expand the number of pathogens actively tracked in 
FoodNet sites, with the purpose of expanding knowledge of foodborne 
illness through precise monitoring of the burden of foodborne illness 
over time. The population currently participating in FoodNet is 
sufficiently large to address many food safety questions and to provide 
data that can be generalized to the nation as a whole.
    Question. What is your goal for expansion of PulseNet?
    FDA answer. PulseNet, CDC's national molecular subtyping network 
for foodborne disease surveillance, has demonstrated the utility of 
real-time routine fingerprinting of pathogenic bacteria by state health 
departments. The broad goal of PulseNet is to be a national early 
warning system to identify and track nationwide trends of foodborne 
illness. In fiscal year 1999 and 2000, CDC will expand the national 
network of laboratories performing molecular subtyping and increase the 
number of pathogens monitored though standard, molecular subtyping 
methods.
    State (and city) public health laboratories participating in 
PulseNet have been able to facilitate outbreak investigations by 
helping to better interpret epidemiologic data on outbreaks, identify 
clusters of disease that would not have been otherwise identified, and 
link cases in distant locations with outbreaks occurring in a specific 
region the country. This will allow earlier detection of outbreaks of 
contaminated foods that are nationally distributed.
    For PulseNet to be fully successful, the state public health 
laboratories must have adequate resources and capability to perform 
routine subtyping of foodborne pathogenic bacteria in a timely fashion, 
complete analysis of the data without delay, provide the subtyping data 
and interpretations to state epidemiologists, and send the DNA patterns 
to CDC (or upload the patterns to the PulseNet server located at CDC) 
so that the patterns could be compared with the national database and 
shared with other PulseNet laboratories. Presently 33 states 
participate in PulseNet; additional states will be added over time.
    FDA working through the CDC will expand its access to PulseNet and 
increase outbreak response and associated traceback activities. FDA 
will begin initial development of electronic communication and data 
sharing systems for use in Federal-State monitoring and traceback 
activities. Working with CDC, FDA will also expand and increase the 
overall capacity of the National Antimicrobial Resistance Monitoring 
System or NARMS and the number of states covered to assure a higher 
probability of detecting emerging resistant pathogens capable of animal 
to human transmission and to minimize the occurrence of foodborne 
outbreaks including those from outside of the United States.
    As of December 1998, FDA's Center for Food Safety and Applied 
Nutrition or CFSAN, USDA, 25 State Health Departments and two County 
Health Departments were connected to a central server at the CDC. All 
E. coli O157:H7 isolated at these sites are being reported to CDC for 
comparisons; other pathogens analyzed on a case-by-case basis include 
Listeriamonocytogenes and various Salmonella and Shigella species.
    In fiscal year 1999, two FDA regional FDA field laboratories will 
be equipped and trained to participate in PulseNet. FDA's Center for 
Veterinary Medicine or CVM may also participate, initially using CFSAN 
as a gateway, on pathogens of mutual interest such as Salmonella 
Typhimurium DT104. This strain is multi-drug resistant and is rapidly 
becoming one of the most prevalent Salmonella species encountered. A 
parallel effort conducted through field labs will subject all 
Salmonella isolated from food to antibiotic resistance screening. Those 
exhibiting multi-resistance will be submitted for PulseNet analyses.
    The other three FDA field labs identified as mega-centers will be 
equipped and trained for PulseNet as resources become available. This 
will minimize the time between the isolation of a pathogen from a food 
sample and the reporting of its DNA fingerprint to the PulseNet system.
    Once the system is refined, other foodborne pathogens of public 
health significance will be included for 100 percent reporting. By 
analyzing pathogens from outbreaks and apparently sporadic cases, the 
system will detect those diffuse clusters that currently often get 
erroneously classified as sporadic cases. Identifying the foods 
involved in these many-mini diffuse outbreaks will help better focus 
surveillance activities of the FDA field operations. In the future, the 
network will be linked to a similar network in the European Union so as 
to share outbreak data and spot emerging pathogens that may have 
pandemic potential.
    Question. The National Academy of Sciences indicated in its report 
that ``Surveillance efforts currently in place (such as FoodNet) have 
been designed to provide data representative of national trends with 
regard to seven indicator foodborne pathogens yet are not designed to 
identify trends within smaller geographic areas of communities.'' To 
what extent is this true?
    USDA answer. Yes, as indicated in the National Academy of Sciences' 
report, surveillance efforts currently in place, such as FoodNet, have 
been designed to provide data representative of national trends, yet 
are not designed to identify trends within smaller geographic areas of 
communities. However, it is important to note that FoodNet data are 
used by each of the FoodNet sites to determine the most important 
foodborne illness prevention programs that should be undertaken by that 
site.
    FDA answer. FoodNet--the Foodborne Diseases Active Surveillance 
Network--consists of active surveillance for foodborne diseases and 
related epidemiologic studies designed to help public health officials 
better understand the epidemiology of foodborne diseases in the United 
States. FoodNet is designed to provide accurate and precise national 
estimates and interpretation of the burden of foodborne diseases over 
time. FoodNet provides a network for responding to new and emerging 
foodborne diseases of national importance, monitoring the burden of 
foodborne disease, and identifying the source of specific foodborne 
diseases. Specifically, the goals of FoodNet are to describe the 
epidemiology of new and emerging bacterial, parasitic and viral 
foodborne pathogens; to estimate the frequency and severity of 
foodborne diseases that occur in the United States each year; and to 
determine how much foodborne illness results from eating specific 
foods, such as meat, poultry, and eggs.
    Through other ``passive'' disease surveillance systems, the states 
and localities are able to detect outbreaks in geographic areas of the 
communities.
    Question. Testimony was presented to the Committee that ``Food 
Safety Initiative'' includes funding for any program or activity 
mentioned in the May 1997 report to the President entitled ``Food 
Safety from Farm to Table: A National Food Safety Initiative''. Provide 
a list of the ``Food Safety Initiative'' expenditures. List each by 
federal agency, appropriations account, and activity and show the 
fiscal year 1997, 1998, 1999, and 2000 budget request levels.
    USDA answer. For the record, the following table presents by 
federal agency, appropriations account and activity funds budgeted for 
the ``Food Safety Initiative'', which focuses on the reduction of 
microbial pathogens in the Food Supply, in fiscal years 1997, 1998, 
1999, and 2000.
    [The information follows:]

                          PRESIDENT'S FOOD SAFETY INITIATIVES--FISCAL YEAR 2000 BUDGET
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                               2000     Increase
                                                              1997       1998       1999      Budget   Over 1999
----------------------------------------------------------------------------------------------------------------
                       SURVEILLANCE
 
USDA:
    Food Safety and Inspection Research Service..........      1,000      1,500      1,500      1,500  .........
    Economic Research Service............................         32         32        282        285          3
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      1,032      1,532      1,782      1,785          3
                                                          ======================================================
HHS:
    Food and Drug Administration.........................        737      3,837      4,637     11,037      6,400
    Centers for Disease Control and Prevention...........      4,500     14,500     19,000     29,000     10,000
                                                          ------------------------------------------------------
        Subtotal, HHS....................................      5,237     18,337     23,637     40,037     16,400
                                                          ------------------------------------------------------
        Subtotal, Surveillance...........................      6,269     19,869     25,419     41,822     16,403
                                                          ======================================================
                       COORDINATION
 
USDA: Food Safety and Inspection Service.................  .........  .........  .........        500        500
HHS: Food and Drug Administration........................      7,173      7,673      7,873      7,873  .........
                                                          ------------------------------------------------------
      Subtotal, Coordination.............................      7,173      7,673      7,873      8,373        500
                                                          ======================================================
                       INSPECTIONS
 
USDA: Food Safety and Inspection Service.................  .........        565     10,113     12,513      2,400
HHS: Food and Drug Administration........................     73,244     82,244    103,344    120,244     16,900
                                                          ------------------------------------------------------
      Subtotal Inspections...............................     73,244     82,809    113,457    132,757     19,300
                                                          ======================================================
                     RISK ASSESSMENT
 
USDA: Agricultural Research Service......................      5,461      4,498      4,909      7,309      2,400
Cooperative State Research Education, and Extension              145        150      2,612      3,702      1,090
 Service.................................................
Food Safety and Inspection Service.......................  .........  .........      3,260      3,260  .........
Economic Research Service................................         33         36        236        686        450
National Agricultural Statistics Service.................  .........  .........  .........      2,500      2,500
Office of the Chief Economist............................         62         60        158        158  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      5,701      4,741     11.175     17,615      6,440
                                                          ======================================================
HHS: Food and Drug Administration........................      2,589      6,189      7,189      8,689      1,500
                                                          ======================================================
      Subtotal, Administration...........................      8,290     10,930     18,364     26,304      7,940
                                                          ======================================================
                        EDUCATION
 
USDA:
    Cooperative State Research, Education, and Extension       2,365      2,365      7,365      8,287        922
     Service.............................................
    Food Safety and Inspection Service...................  .........  .........      3,659      3,659  .........
    Food And Nutrition Service...........................  .........  .........      2,000      2,000  .........
    Office of the Chief Economist........................         27         38         38         38  .........
    Economic Research Service............................        420        420        420        420  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      2,812      2,823     13,482     14,404        922
                                                          ======================================================
HHS:
    Food and Drug Administration.........................      4,800      6,600      7,100      8,600      1,500
    Centers for Disease Control and Prevention...........  .........  .........        476        476  .........
                                                          ------------------------------------------------------
        Subtotal, HHS....................................      4,800      6,600      7,576      9,076      1,500
                                                          ------------------------------------------------------
        Subtotal, Education..............................      7,612      9,423     21,058     23,480      2,422
                                                          ======================================================
                         RESEARCH
 
USDA:
    Agricultural Research Service........................     44,186     50,351     64,959     74,279      9,329
    Cooperative State Research, Education, and Extension       3,724      6,250     14,788     23,799      9,011
     Service.............................................
    Agricultural Marketing Service.......................  .........  .........        112      6,297      6,185
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................     47,910     56,601     79,859    104,375     24,516
                                                          ======================================================
HHS: Food and Drug Administration........................     20,793     26,793     28,193     31,893      3,700
                                                          ------------------------------------------------------
      Subtotal, Research.................................     68,703     83,394    108,052    136,268     28,216
                                                          ======================================================
      Total, Initiative..................................    171,291    214,098    294,223    369,004     74,781
----------------------------------------------------------------------------------------------------------------


                          PRESIDENT'S FOOD SAFETY INITIATIVE FISCAL YEAR 2000 PROPOSAL
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                               2000     Increase
                                                              1997       1998       1999      Budget   Over 1999
----------------------------------------------------------------------------------------------------------------
USDA:
    Agricultural Research Service........................     49,647     54,849     69,868     81,588     11,720
    Cooperative State Research, Education, and Extension       6,234      8,765     24,765     35,788     11,023
     Service.............................................
    Agricultural Marketing Service.......................  .........  .........        112      6,297      6,185
    Food Safety and Inspection Service...................      1,000      2,065     18,532     21,432      2,900
    Economic Research Service............................        485        485        938      1,391        453
    Office of the Chief Economics........................         89         98        196        196  .........
    National Agricultural Statistics Service.............  .........  .........  .........      2,500      2,500
    Food and Consumer Service............................  .........  .........      2,000      2,000  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................     57,455     66,262    116,411    151,192     34,781
                                                          ======================================================
HHS:
    Food and Drug Administration.........................    109,336    133,336    158,336    188,336     30,000
    Centers for Disease Control and Prevention...........      4,500     14,500     19,476     29,476     10,000
                                                          ------------------------------------------------------
        Subtotal, HHS....................................    113,836    147,836    177,812    217,812     40,000
                                                          ======================================================
        Total, Initiative................................    171,291    214,098    294,223    369,004     74,781
----------------------------------------------------------------------------------------------------------------

    FDA answer. CDC is as follows:

                          PRESIDENT'S FOOD SAFETY INITIATIVES--FISCAL YEAR 2000 BUDGET
                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                  Fiscal years--
                                                                 -----------------------------------------------
                                                                     1997        1998        1999        2000
----------------------------------------------------------------------------------------------------------------
Surveillance....................................................       4.500      14.290      19.000      29.000
Education.......................................................  ..........  ..........        .476        .476
                                                                 -----------------------------------------------
      Total.....................................................       4.500      14.290      19.476      29.476
----------------------------------------------------------------------------------------------------------------

    A list of the ``Food Safety Initiative'' expenditures for fiscal 
year 1997, 1998, 1999, and 2000 budget request is provided for the 
record.
    [The information follows:]

                          PRESIDENT'S FOOD SAFETY INITIATIVES--FISCAL YEAR 2000 BUDGET
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                               2000     Increase
                                                              1997       1998       1999      Budget   Over 1999
----------------------------------------------------------------------------------------------------------------
                       SURVEILLANCE
 
USDA:
    Food Safety and Inspection Research Service..........      1,000      1,500      1,500      1,500  .........
    Economic Research Service............................         32         32        282        285          3
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      1,032      1,532      1,782      1,785          3
                                                          ======================================================
HHS:
    Food and Drug Administration.........................        737      3,837      4,637     11,037      6,400
    Centers for Disease Control and Prevention...........      4,500     14,500     19,000     29,000     10,000
                                                          ------------------------------------------------------
        Subtotal, HHS....................................      5,237     18,337     23,637     40,037     16,400
                                                          ------------------------------------------------------
        Subtotal, Surveillance...........................      6,269     19,869     25,419     41,822     16,403
                                                          ======================================================
                       COORDINATION
 
USDA: Food Safety and Inspection Service.................  .........  .........  .........        500        500
HHS: Food and Drug Administration........................      7,173      7,673      7,873      7,873  .........
                                                          ------------------------------------------------------
      Subtotal, Coordination.............................      7,173      7,673      7,873      8,373        500
                                                          ======================================================
                       INSPECTIONS
 
USDA: Food Safety and Inspection Service.................  .........        565     10,113     12,513      2,400
HHS: Food and Drug Administration........................     73,244     82,244    103,344    120,244     16,900
                                                          ------------------------------------------------------
      Subtotal Inspections...............................     73,244     82,809    113,457    132,757     19,300
                                                          ======================================================
                     RISK ASSESSMENT
 
USDA: Agricultural Research Service......................      5,461      4,498      4,909      7,309      2,400
Cooperative State Research Education, and Extension              145        150      2,612      3,702      1,090
 Service.................................................
Food Safety and Inspection Service.......................  .........  .........      3,260      3,260  .........
Economic Research Service................................         33         36        236        686        450
National Agricultural Statistics Service.................  .........  .........  .........      2,500      2,500
Office of the Chief Economist............................         62         60        158        158  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      5,701      4,741     11.175     17,615      6,440
                                                          ======================================================
HHS: Food and Drug Administration........................      2,589      6,189      7,189      8,689      1,500
                                                          ======================================================
      Subtotal, Administration...........................      8,290     10,930     18,364     26,304      7,940
                                                          ======================================================
                        EDUCATION
 
USDA:
    Cooperative State Research, Education, and Extension       2,365      2,365      7,365      8,287        922
     Service.............................................
    Food Safety and Inspection Service...................  .........  .........      3,659      3,659  .........
    Food And Nutrition Service...........................  .........  .........      2,000      2,000  .........
    Office of the Chief Economist........................         27         38         38         38  .........
    Economic Research Service............................        420        420        420        420  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................      2,812      2,823     13,482     14,404        922
                                                          ======================================================
HHS:
    Food and Drug Administration.........................      4,800      6,600      7,100      8,600      1,500
    Centers for Disease Control and Prevention...........  .........  .........        476        476  .........
                                                          ------------------------------------------------------
        Subtotal, HHS....................................      4,800      6,600      7,576      9,076      1,500
                                                          ------------------------------------------------------
        Subtotal, Education..............................      7,612      9,423     21,058     23,480      2,422
                                                          ======================================================
                         RESEARCH
 
USDA:
    Agricultural Research Service........................     44,186     50,351     64,959     74,279      9,329
    Cooperative State Research, Education, and Extension       3,724      6,250     14,788     23,799      9,011
     Service.............................................
    Agricultural Marketing Service.......................  .........  .........        112      6,297      6,185
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................     47,910     56,601     79,859    104,375     24,516
                                                          ======================================================
HHS: Food and Drug Administration........................     20,793     26,793     28,193     31,893      3,700
                                                          ------------------------------------------------------
      Subtotal, Research.................................     68,703     83,394    108,052    136,268     28,216
                                                          ======================================================
      Total, Initiative..................................    171,291    214,098    294,223    369,004     74,781
----------------------------------------------------------------------------------------------------------------


                          PRESIDENT'S FOOD SAFETY INITIATIVE FISCAL YEAR 2000 PROPOSAL
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                               2000     Increase
                                                              1997       1998       1999      Budget   Over 1999
----------------------------------------------------------------------------------------------------------------
USDA:
    Agricultural Research Service........................     49,647     54,849     69,868     81,588     11,720
    Cooperative State Research, Education, and Extension       6,234      8,765     24,765     35,788     11,023
     Service.............................................
    Agricultural Marketing Service.......................  .........  .........        112      6,297      6,185
    Food Safety and Inspection Service...................      1,000      2,065     18,532     21,432      2,900
    Economic Research Service............................        485        485        938      1,391        453
    Office of the Chief Economics........................         89         98        196        196  .........
    National Agricultural Statistics Service.............  .........  .........  .........      2,500      2,500
    Food and Consumer Service............................  .........  .........      2,000      2,000  .........
                                                          ------------------------------------------------------
      Subtotal, USDA.....................................     57,455     66,262    116,411    151,192     34,781
                                                          ======================================================
HHS:
    Food and Drug Administration.........................    109,336    133,336    158,336    188,336     30,000
    Centers for Disease Control and Prevention...........      4,500     14,500     19,476     29,476     10,000
                                                          ------------------------------------------------------
        Subtotal, HHS....................................    113,836    147,836    177,812    217,812     40,000
                                                          ======================================================
        Total, Initiative................................    171,291    214,098    294,223    369,004     74,781
----------------------------------------------------------------------------------------------------------------

    Question. Provide a list by federal agency, appropriations account, 
and activity of the food safety related expenditures not counted as 
part of the ``Food Safety Initiative'' for each of fiscal years 1997, 
1998, 1999, and requested for fiscal year 2000.
    USDA answer. For the record, the following table presents the 
remaining balance of the Food Safety and Inspection Service's budgetary 
resources from fiscal year 1997 to 2000 after subtracting resources 
devoted to the President's Food Safety Initiative. All of the remaining 
funding for the Food Safety and Inspection Service (FSIS) is for food 
safety related activity. The President's Council on Food Safety will be 
developing a comprehensive strategic plan identifying all Food Safety 
activities for 5 core Food Safety hazards: microbial hazards, chemical 
contaminants, regulated/pre-market approved substances, physical 
hazards, and water used in food production and processing.
    [The information follows:]

                    FOOD SAFETY RELATED EXPENDITURES
                         [Dollars in thousands]
------------------------------------------------------------------------
                                                                  2000
          Activity               1997       1998       1999      Budget
------------------------------------------------------------------------
Food Safety and Inspection
 Service (FSIS)
Food Inspection.............    478,012    492,836    503,543    533,744
Import/Export Inspection....     11,300     11,612     11,857     12,315
Laboratory Services.........     33,918     33,763     34,376     35,740
Field Automation............      8,525      8,023      8,023      8,023
Grants-to-States............     41,528     40,552     40,655     41,701
Special Assistance to State          26        374  .........  .........
 Programs Unobligated
 Balance Lapsing............
                             -------------------------------------------
      Subtotal FSIS             573,309    587,160    598,454    631,523
       Available............
                             ===========================================
Reimbursements /Trust Funds.     85,673     89,083     89,302     89,274
                             -------------------------------------------
      Subtotal FSIS.........    658,982    676,243    687,756    720,797
                             ===========================================
President's Food Safety           1,000      2,065     18,532     21,432
 Initiative.................
                             ===========================================
      Total.................    659,982    678,308    706,288    742,229
------------------------------------------------------------------------

Research, Education, and Economics
    All ARS food safety related expenditures are included in the ``Food 
Safety Initiative''. The funding provided for the Food Safety 
Initiative was $49,647,300 in fiscal year 1997; $54,949,400 in fiscal 
year 1998; $69,867,600 in fiscal year 1999; and $81,587,600 is 
requested for fiscal year 2000. The Appropriations Accounts for fiscal 
years 1997 to 1999 were 1271400, 1281400, and 1291400. The fiscal year 
2000 Appropriations Account will be 1201400.
    CSREES Hatch Act, Evans-Allen Program, Animal Health and Disease 
Research, and Special Research Grant funds support the food safety 
research activities in addition to funding for the ``Food Safety 
Initiative''. The total estimated funding provided for Food Safety 
research was $5,961,000 in fiscal year 1997; $5,962,000 in fiscal year 
1998; $6,123,000 in fiscal year 1999; and $3,748,000 is requested in 
fiscal year 2000. The CSREES Appropriation accounts for fiscal years 
1997 through 1999 were 1271500, 1281500, 1291500 for these research 
activities. The fiscal year 2000 Appropriations account will be 
1201500.
    A table showing the funding by activity for food safety related 
expenditures not counted as part of the Food Safety Initiative follows.

      COOPERATIVE STATE RESEARCH, EDUCATION, AND EXTENSION SERVICE
                              [Food safety]
------------------------------------------------------------------------
                                Fiscal                            2000
           Program            year 1997     1998       1999      Budget
------------------------------------------------------------------------
Hatch.......................      1,726      1,726      1,846      1,571
Evans-Allen.................        516        516        552        514
Animal Health...............         70         70         75         69
Special Research Grants.....      3,649      3,650      3,650      1,594
                             -------------------------------------------
      Totals................      5,961      5,962      6,123      3,748
------------------------------------------------------------------------

    FDA answer. We would be happy to provide that information for the 
record.
    [The information follows:]

                                                            FOOD SAFETY RELATED EXPENDITURES
                                                                  [Dollars in millions]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Fiscal year 1997          Fiscal year 1998          Fiscal year 1999          Fiscal year 2000
                Program/Activity                 -------------------------------------------------------------------------------------------------------
                                                    Dollars        FTE        Dollars        FTE        Dollars        FTE        Dollars        FTE
--------------------------------------------------------------------------------------------------------------------------------------------------------
FOODS--Center for Food Safety & Applied                  43.0          451         42.2         44.3         41.8          391     \1\ 60.3          448
 Nutrition......................................
    Chemical Safety of Foods....................         28.1          295         30.2          325         29.9          279         48.4          336
    Nutrient Quality & Food Labeling............         14.9          156         12.0          118         11.9          112         11.9          112
FOODS--Field....................................         41.5          514         40.3          508         38.6          444         38.6          484
    Chemical Safety of Foods....................         26.0          322         16.8          212         16.9          194         18.4          230
    Nutrient Quality & Food Labeling............          4.8           59          4.1           51          3.5           41          3.2           41
    Microbiological Safety of Foods.............         10.7          133         19.4          245         18.2          209         17.0          213
ANIMAL DRUGS AND FEEDS--Center for Veterinary            19.5          197         19.6          187         20.2          194         22.9          211
 Medicine.......................................
    Approval Process............................         11.5          117          9.7          100          9.9          102         11.2          120
    Research....................................          3.1           31          4.3           33          4.5           35          4.2           38
Monitoring/Compliance...........................          4.9           49          5.6           54          5.8           57          7.5           53
ANIMAL DRUGS AND FEEDS--Field...................          9.4          108         10.2          112         10.1          127         12.9          140
    Approval Process............................          1.3           15          1.7           19          1.7           22          2.3           26
    Research....................................          1.0           12           .8            8          0.7            9           .8            8
    Monitoring/Compliance.......................          7.1           81          7.7           85          7.7           96          9.8          106
NATIONAL CENTERS FOR TOXICOLOGICAL RESEARCH.....          1.1           20          1.4           25          2.2           25          2.2           25
    Microbiological & Analytical Methods to                .1            5           .1            5           .6            6           .6            6
     identify chemical contaminants and toxins..
    Improve sensitivity of techniques to measure          1.0           15          1.3           20          1.6           19          1.6           19
     harmful effects of toxicants in foods and
     cosmetics..................................
                                                 -------------------------------------------------------------------------------------------------------
        TOTAL FDA, NON-FSI......................        114.5        1,290        113.7        1,275        112.9        1,181        136.9        1,308
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Includes proposed additive user fees ($10 million).

    Question. What is the status of USDA's plans to expand the number 
of products that would be considered adulterants if they contain E. 
coli O157:H7?
    USDA answer. FSIS is evaluating the comments submitted on the 
January 19, 1999, Federal Register Notice (64 FR 2803), as well as the 
statements presented at the March 8, 1999, public meeting. In addition, 
a risk assessment for Escherichia coli O157:H7 in beef and ground beef, 
announced in an August 18, 1998, Federal Register Notice (63 FR 44232), 
is expected to be completed by September 1999. Furthermore, an industry 
coalition has stated that it will submit a protocol for a carcass 
testing study in early April 1999. FSIS does not expect to begin to act 
on the January 19 policy statement until it has had sufficient 
opportunity to assess the comments received.
    Question. FSIS has been testing beef for E. coli O157:H7 since 
1996. Out of 26,088 samples, only 25 positives have been found, none of 
which were connected to an outbreak or illness.
    (A) What are the current expenditures for this testing program?
    USDA answer. The Food Safety and Inspection Service (FSIS) spends 
approximately $10.4 million per year on testing meat and poultry 
products for 9 pathogens, including E. coli O157:H7, Salmonella, 
Campylobacter, and Listeria.
    (B) If, in nearly three years of testing, none of the positive 
results have been associated with an outbreak or illness, what is the 
justification for continuing this program?
    USDA answer. The testing program for E. coli O157:H7 began after 
the tragic outbreak of foodborne illness associated with this pathogen 
in the State of Washington. USDA estimates that over 10,000 illnesses 
per year result from consuming foods contaminated with E. coli O157:H7.
    As the Washington outbreak demonstrated, those most susceptible to 
this pathogen include children, the elderly, and the immune 
compromised. Testing programs like that for E. coli O157:H7 assist FSIS 
in controlling deadly pathogens by identifying contaminated product in 
time to remove it from the market before it can cause foodborne 
illness. The justification for continuing this program is that the 
agency believes this testing program is reducing the risk of illnesses/
outbreaks caused by E. coli O157:H7 in raw ground beef. The FSIS 
program of random sampling at federal, State, and import establishments 
and at the retail level, as well as the implications of a positive 
finding, encourage the meat industry to use good manufacturing 
practices, good sanitation procedures, antimicrobial interventions, 
microbial testing, and other measures to eliminate this serious 
pathogen from the nation's meat supply.
    Question. Although this year the President's budget recognizes that 
enabling legislation must be enacted into law, it again assumes savings 
in appropriations from its proposal to implement user fees to pay the 
cost of meat and poultry inspection. Why does the Administration 
believe that meat inspection is a benefit to industry, rather than a 
public health service which is provided for the benefit of the public?
    USDA answer. Both the public and industry benefit from our 
inspection services. However, industry is the direct beneficiary of 
Federal inspection, which enables businesses to engage in commerce and 
earn profits. Industry also directly benefits from the consumer's 
confidence in inspected meat, poultry, and egg products. The consuming 
public benefits from the public health protections that Federal 
inspection provides.
    Question. I understand that a relationship has been found between 
bacteria in food supplies where close, crowded conditions for animals 
exist. Is this true? What is being done about this ?
    USDA answer. No relationship has been found between bacteria in 
food supplies where close crowded conditions for animals exist. FSIS 
has sponsored a pair of recent studies of dairy animals reared in close 
quarters, most of which are ``cull cows''. Bacterial samples were 
collected from cattle at the farms, through transport (under crowded 
conditions), and from the carcasses. There was no correlation between 
results from live cattle and finished carcasses. Similar work done with 
poultry indicates the same is true for these intensively reared 
animals.
    Question. HACCP in large plants was implemented a year ago. What 
improvements have been made with respect to the incidence of 
Salmonella, E coli, and other food-borne pathogens?
    USDA answer. Preliminary findings show that this science-based, 
prevention-oriented system has contributed to reducing the prevalence 
of Salmonella in some raw meat and poultry. As the following chart 
illustrates, based on the one-year of data collection in the 
approximately 200 large plants that implemented HACCP in January 1998 
and produced product subject to the Salmonella testing requirement, the 
prevalence of Salmonella has significantly fallen.
    In ground beef, for example, 7.5 percent of the national baseline 
samples tested positive for Salmonella prior to January 1998; only 4.8 
percent tested positive after HACCP implementation; a decline of 36 
percent. Of broiler carcasses, 20.0 percent tested positive for 
Salmonella before HACCP implementation, compared to 10.9 percent after 
implementation, a decline of over 45 percent. On swine carcasses, 8.7 
percent of the samples tested positive prior to HACCP versus 6.5 
percent after HACCP implementation, a decrease of more than 25 percent. 
And, 49.9 percent of ground turkey tested positive prior to HACCP 
versus 36.4 percent after HACCP implementation, a 27 percent decrease.
    The data also indicates that 88 percent of HACCP plants for which 
there are adequate data meet or exceed our Salmonella performance 
standards. Plants that do not meet the standards are required to take 
immediate corrective measures, and also undergo targeted testing.
    [The information follows:]

 TABLE 1.--PREVALENCE OF SALMONELLA IN MEAT AND POULTRY PRODUCTS: POST-
HACCP IMPLEMENTATION RESULTS FROM LARGE PLANTS JANUARY 26, 1998, THROUGH
                          JANUARY 25, 1999 \1\
------------------------------------------------------------------------
                                    Pre-HACCP
        Class of Product            Baseline            Post-HACCP
                                   Studies \2\        implementation
------------------------------------------------------------------------
Broilers.......................          \3\ 20        \3\ 10.9 (n=5697)
Swine..........................         \3\ 8.7         \3\ 6.5 (n=1532)
Ground Beef....................         \3\ 7.5         \3\ 4.8 (n=1184)
Ground Turkey..................        \3\ 49.9        \3\ 36.4 (n=748)
------------------------------------------------------------------------
\1\ Reflects testing results from products with 10 or more completed
  sample sets.
\2\ Corresponds to Salmonella performance standards, 9 CFR Sec.
  310.25(b) and 381.94(b).
\3\ Percentage of Salmonella Prevalence (n=number of samples).


----------------------------------------------------------------------------------------------------------------
                                                                                                      Percent
                                                                                     Number of       (Number)
                                                                     Number of      Plants with       Meeting
                        Class of Product                              Plants       Complete Data    almonell a
                                                                                       Sets         Performance
                                                                                                   Standard \1\
----------------------------------------------------------------------------------------------------------------
Broilers........................................................             124              76         91 (69)
Swine...........................................................              33              17         71 (12)
Ground Beef.....................................................              25              10          90 (9)
Ground Turkey...................................................              17              11         91 (10)
                                                                 -----------------------------------------------
    Total.......................................................             199             114       88 (100)
----------------------------------------------------------------------------------------------------------------
\1\ Reflects testing results from products with 10 or more completed sample sets.

    Question. What challenges has FSIS had to overcome in implementing 
the HACCP program?
    USDA answer. For the record, here are a few examples of challenges.
    The establishment and delivery of a cost effective HACCP Technical 
Training Program for field inspection and compliance personnel was a 
major challenge. Inspection personnel are located in over 2,500 
different, often geographically remote, locations across the United 
States. The majority of our workforce is tied to the production 
schedules of the meat and poultry industries. Plant operating schedules 
had to be taken into account and replacement inspectors brought into 
plants where assigned personnel were being training during plant 
operating hours.
    After decades of performing inspection from a command and control 
perspective, gaining the acceptance of the field workforce of the new 
regulatory approach--established by the Pathogen Reduction and HACCP 
rule--proved to be a challenge.
    Some members of the meat and poultry industry had the view that the 
PR/HACCCP rule provided increased authority to in-plant inspection 
personnel and were apprehensive that inspection personnel would use it 
in an adverse way.
    Question. When HACCP was implemented a year ago, there was concern 
about layering the new HACCP system over the old, outdated organoleptic 
system. Even USDA expressed concern and committed to conducting an 
internal regulatory review to take these old rules off the books. Can 
you give the committee the status of that review? How many of those old 
rules have been removed from the books? And, what is your time line for 
completing this regulatory review?
    USDA answer. On December 29, 1995, FSIS published an advance notice 
of proposed rulemaking (ANPR) in the Federal Register describing the 
FSIS regulatory review agenda (60 FR 67469). Several command-and-
control type regulations were identified as being appropriate for 
conversion to performance standard-based regulations, while other 
regulations were identified as being obsolete in the HACCP regulatory 
environment. Of the regulations identified as candidates for revision 
or removal prior to HACCP implementation, FSIS issued one final rule 
prior to the January 1998 HACCP implementation for large 
establishments; ``Eliminating of Prior Approval Requirements for 
Establishment Drawings and Specifications, Equipment, and Certain 
Partial Quality Control Programs,'' published on August 25, 1997 (62 FR 
45016).
    FSIS and FDA jointly published an advance notice of proposed 
rulemaking on ``Transportation and Storage Requirements for Potentially 
Hazardous Foods'' in the Federal Register on November 22, 1996 (61 FR 
59372). The comments have been evaluated and a performance standard-
based proposed rule is being developed. The first in a series of 
process performance standards for ready-to-eat products--``Performance 
Standards for the Production of Certain Meat and Poultry Product''--was 
published as a final rule in the Federal Register on January 6, 1999 
(64 FR 732). Meanwhile, several proposed rules published in the Federal 
Register and are now in the process of being finalized, including the 
following: ``Sanitation Requirements for Official Meat and Poultry 
Establishments,'' publishing on August 25, 1997 (62 FR 45045); ``Rules 
of Practice,'' publishing on January 12, 1998 (63 FR 1797); and ``Meat 
Produced by Advanced Meat/Bone Separation Machinery and Recovery 
Systems,'' published on April 13, 1998 (63 FR 17959).
    FSIS has a number of dockets under development for replacing other 
prescriptive requirements with performance standards, including water 
retention in poultry, chilling requirements for slaughtered poultry, 
and processing/handling temperature requirements for livestock and 
poultry. In addition, a proposed rule for the elimination of most of 
the remaining partial quality control requirements is expected to be 
published this spring. FSIS expects that final action on many current 
regulatory reform efforts will be completed prior to the beginning of 
2001.
    Question. With respect to the Administration's commitment to food 
safety research and your request for funding for fiscal year 2000, can 
you tell the committee what, if any, efforts are planned to eliminate 
E. coli O157:H7 in beef, and Listeriamonocytogenes in ready-to-eat meat 
and poultry products other than enforcing a zero tolerance standard for 
these pathogens and overseeing product recalls?
    USDA answer. We are continuing to work with ARS concerning research 
that could lead to procedures to control or eliminate E. coli O157:H7 
in beef. ARS research is providing valuable information into the 
etiology of this organism. It is too early to predict if it will be 
possible to eliminate this organism as a potential contaminant of the 
cattle slaughtering process.
    The industry procedures used to process ready-to-eat products will 
kill Listeria monocytogenes. However, product can become recontaminated 
during packaging and distribution if cooked products are not 
distributed in the containers in which they were cooked.
    Since this is a hazard that is likely to occur, the industry is 
studying procedures to control the hazard. For example, one producer 
has started distributing hot dogs in the plastic casing in which they 
where cooked. Another possibility is packaging in special clean rooms 
where precautions such as airlocks, special air filters, and limited 
access are used.
    ARS carries out research programs to help eliminate E. coli O157:H7 
from beef including pathogen identification, pre and postharvest 
ecology, and pathogenesis. The preharvest ARS research programs to 
control E. coli O157:H7 and related organisms in cattle seek to 
understand the carrier state of E. coli O157:H7 in calves; to describe 
the epidemiology and occurrence of this pathogen in the production 
environment of food producing animals, and to discern the relationship 
of preslaughter feeding and production factors, including 
transportation to post slaughter contamination. Research on control of 
E. coli and other pathogens in animal manure is being initiated which 
will further help achieve pathogen control. ARS postharvest research 
improves slaughter and dressing procedures to minimize contamination on 
carcasses; develops predictive models for the growth of the pathogen on 
meat products; and develops more rapid and user friendly detection 
methods using biotechnology approaches. This research can provide the 
means to greatly lower the incidence of toxigenic E. coli, but because 
of environmental occurrence, including wild animals, insects and water 
supplies, it is unlikely that all toxigenic E. coli can be eliminated 
from food-producing animals.
    ARS has research programs directed to the development of 
intervention strategies for Listeria that may be incorporated into 
HACCP programs to eliminate the pathogen. A rapid gene based assay has 
been developed that can readily identify and differentiate Listeria 
species in various ready-to-eat foods, allowing for molecular 
fingerprinting and trace-back. A program has been initiated, 
specifically aimed at developing technology to surface pasteurize food 
products, including hot dogs, which economically reduces microbial 
contamination without significant loss of product quality. A major 
research program continues in an effort to determine the effect of 
various food components, and parameters (pH, water activity, salt, 
process and storage temperature) on the inactivation, survival and 
growth of Listeria in ready to eat products. L. monocytogenes is a 
highly unusual and difficult pathogen to eliminate in that it possesses 
the ability to adapt and grow under conditions of high salt, high 
osmolarity, and low temperature, all at the same time. Research is 
specifically aimed at understanding, at cellular and molecular level, 
how this adaptation and growth occurs. Research is also aimed at 
identifying new generally recognized as safe (GRAS) compounds that can 
be incorporated into foods as a antimicrobial agents to protect against 
Listeria and other pathogens.
    Question. Does FSIS have any data or other scientific evidence to 
support the provision of additional oversight or inspection resources 
to ``in-distribution'' facilities ?
    USDA answer. Since the publication of the proposed Pathogen 
Reduction/HACCP regulation on February 3, 1995, FSIS has indicated its 
concern about the possibility that food safety hazards can be 
introduced into meat and poultry products at virtually any point in the 
farm-to-table continuum, but agency resources were heavily concentrated 
in official slaughtering and processing establishments. Commenters 
supported the more equitable distribution of agency resources. In the 
preamble to the final rule, FSIS stated, ``A large number of commenters 
requested that HACCP be required throughout all phases of food 
production from the farm to the consumer.'' The final PR/HACCP 
regulations did not include transport temperature requirements which 
would have directed agency resources toward in-distribution locations, 
but this was more a matter of technical feasibility, and not a 
reflection on lack of public interest. The agency has retained its 
interest in this area and has been continuing its work: jointly with 
FDA, it published an ANPR and held a public meeting. The agency expects 
that these efforts will culminate in regulatory proposals setting one 
or more performance standards for the handling of meat and poultry 
products during transport and storage.
    FSIS knows that there are segments of the public which are very 
concerned about the inequities which have arisen under the current 
system of exemptions. FSIS also believes that consumers are concerned 
that the protections provided by regulatory requirements that apply, 
for instance, to grinding hamburger in official establishments, are not 
provided by similar regulatory requirements applicable to the same 
operations when they are conducted by retail stores.
    FSIS is proposing the conversion of 638 inspection personnel to 
Consumer Safety Office rs positions in fiscal year 2000.
    Question. How many traditional inspection personnel will be 
available after this conversion? Is this sufficient to meet slaughter 
and processing facility needs?
    USDA answer. For fiscal year 2000, FSIS plans to stabilize the 
workforce at approximately 7,500 employees who will be involved in 
direct inspection activities. This resource level is adequate to meet 
the needs of the regulated industry. The workforce includes food 
inspectors, veterinarians, consumer safety officers, and consumer 
safety inspectors. The introduction of the Consumer Safety Officer 
classification series will enhance the level of resources committed to 
direct inspection activities at regulated establishments. This series 
is part of the Agency's strategy to improve the skills and 
qualifications of its workforce involved in direct inspection 
activities in regulated establishments as well as to take full 
advantage of these skills to meet its goal of reducing foodborne 
illness and to provide appropriate regulatory oversight within its 
statutory authorities along the farm-to-table continuum.
    Question. How will the role of an inspector differ from the role of 
a Consumer Safety Officer?
    USDA answer. The roles of inspectors, veterinarians, and consumer 
safety officers do not differ. Each functions as the FSIS regulatory 
agent in an establishment under Federal inspection. Each occupation 
brings a different set of qualifications and knowledge to bear on 
making regulatory determinations. The individual assignments and work 
methodologies carried out by various FSIS employees will differ based 
on the need to draw upon different types of scientific knowledge to 
make appropriate regulatory determinations about the compliance of 
industry operations with USDA regulatory requirements.
    Current work methods for food inspectors are ``cookbook'' in nature 
and generally prescribed through central assignment scheduling systems. 
Work methods for Consumer Safety Officers will require the exercise and 
application of scientific knowledge in making regulatory determinations 
about the adequacy of industry HACCP systems, other process control 
systems, and pathogen testing systems. FSIS expects to introduce 
Consumer Safety Officers into the inplant workforce in assignments 
where there is the greatest opportunity to apply scientific, 
professional knowledge in making regulatory determinations about 
industry compliance. This will likely be in locations with a sizeable 
number of plants having a wide diversity of HACCP process categories 
and products, and sophisticated food production technologies and 
pathogen testing systems.
    Question. Will current inspectors require additional training to 
perform their duties as Consumer Safety Officers?
    USDA answer. Yes, additional training will be required. In order to 
qualify for Consumer Safety Officer (CSO) positions, inspectors must 
have obtained an educational background to meet the scientific and 
technical requirements of the position. Although current inspectors who 
are eligible for the CSO series have the appropriate educational 
background, they will have to be trained to operate within a new work 
methodology and with considerably more latitude for making scientific 
judgments than they have in their current inspection positions. The CSO 
position brings additional scientific expertise and decision-making to 
the plant level to assess and verify if plant control systems are 
adequately controlling for food safety hazards.
    Question. If so, what funding is required for this additional 
training? Does the budget request include this funding?
    USDA answer. FSIS plans to use a great deal of the $3.5 million in 
available funds to train 638 newly converted or hired CSO's and their 
supervisors in new work methods. These funds, which are included in the 
total FSIS budget request, will be available for CSO training because 
only a few hundred inspection personnel will require training to 
prepare for implementation of HACCP in the very small plants. The 
Agency is currently in the process of assessing the projected cost of 
CSO training for fiscal year 2000.
    Question. What merits a pay raise for these personnel for 
performing a job integral with the HACCP inspection system for which 
they are already being compensated?
    USDA answer. Consumer Safety Officers will be expected and required 
to apply scientific and professional knowledge in making regulatory 
determinations about industry compliance. The work methodologies and 
job requirements for positions filled by Consumer Safety Officers will 
require the exercise and application of scientific knowledge in an 
evaluative capacity to verify the adequacy of HACCP systems. The salary 
differential compensates individuals for the required application of 
professional judgment in rendering regulatory determinations about 
industry operations that is not currently expected or required of food 
inspectors.
    Question. What additional costs will be associated with these new 
Consumer Safety Officers (ie. travel, vehicle costs)?
    USDA answer. We anticipate that the travel and operating expenses 
of Consumer Safety Officers will be similar to those expenses incurred 
by processing food inspectors, which are higher than those for 
slaughter inspectors.
    Question. Why not put these inspectors where there is a need rather 
than where you may be duplicating the efforts of the Food and Drug 
Administration and local health inspectors?
    USDA answer. The presence of Consumer Safety Officers (CSO's) 
within the FSIS workforce and assigned to Federally inspected plants 
does not duplicate the efforts of FDA or State and local authorities. 
CSO's will be assigned to Federally inspected establishments where they 
will be applying scientific, professional judgment in making 
determinations about industry compliance with HACCP and other 
regulatory requirements. FSIS has determined that there is a need for 
inspection program personnel who possess a different set of skills and 
knowledge, having both an academic background and experience in making 
regulatory decisions. With a flexible, more highly educated work force, 
FSIS will be able to assign personnel to any type of industry operation 
within FSIS' jurisdiction. The future workforce will include a variety 
of scientific disciplines, among which is the professional level 
position of CSO now under development.
    In the long-term, FSIS envisions using the CSO series to employ 
much of the regulatory workforce of the future. Increasing the number 
of inspection personnel in this series will better enable the Agency to 
meet its goal of reducing foodborne illness and provide the appropriate 
regulatory oversight within its statutory authorities along the food 
safety continuum. In order to effect conversion to this series, there 
will be a transition process in which two additional occupational 
series will be used. Line slaughter work in plants that are not part of 
the HACCP-based inspection models project \1\ will continue to be 
classified in the Food Inspector, GS-1863 series. HACCP work now being 
performed will be classified in the Consumer Safety Inspector (CSI), 
GS-1862 series. This is a more appropriate classification series to 
describe this work and it is a series that other Federal agencies have 
used as a companion series to the CSO, GS-696 series, thereby 
facilitating the transition for the long-term. CSI's will perform 
technician level work that involves making judgments using a limited 
range of principles and an extensive body of facts accumulated from 
long-term or in-depth experience in a limited range of work. CSO's will 
make judgments by selecting and using principles and facts from a body 
of knowledge commonly inherent in one or more professional occupations. 
CSO's will be employed in HACCP plants primarily in fiscal year 2000 
due to the highly complex nature of the work in that environment.
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    \1\ Under the slaughter models component of the HACCP-based 
Inspection Models Project, FSIS is exploring alternative ways in which 
slaughter inspection might be accomplished in establishments that have 
already implemented HACCP systems and that exclusively slaughter 
certain market classes of animals. These market classes are young 
poultry, steers and heifers, and market hogs. In all cases, these are 
young, healthy animals that do not exhibit the same disease and public 
health concerns that may be present in older animals.
---------------------------------------------------------------------------
    The presence of food safety hazards after product leaves Federally 
inspected establishments has prompted the Agency to pilot test the use 
of a small number of FSIS resources in the in-distribution sector in 
accordance with the farm-to-table strategy. Under this pilot test FSIS 
will redeploy some inspectors currently assigned within plants to 
verify the safety and wholesomeness of meat and poultry products as 
they move to consumers. This project focuses on developing new 
inspection models that will permit FSIS to deploy inspection resources 
more effectively within plants and between in-plant and in-distribution 
sites, consistent with farm-to-table food safety goals and FSIS current 
statutory obligations in the in-plant and in-distribution sectors. The 
CSI series will be used in the in-distribution pilot of the HACCP-based 
Inspection Models Project. After gaining experience through the Models 
Project, FSIS expects to employ the CSO series in in-distribution.
    FSIS is aware that State and local authorities have primary 
responsibility for food safety regulation and oversight at retail 
levels and are active in other areas as well. Rather, through the 
limited in-distribution pilot and the broader initiatives to create a 
seamless food safety system, FSIS plans to work in partnership with 
State and local food safety agencies. The pilot is expected--and in 
fact designed--to raise questions about coordination with State and 
local agencies, and these will be addressed as the pilot proceeds.
    Question. Do you have any data to show that grocery stores need 
more inspection than imported foods?
    USDA answer. FSIS is not proposing more inspection for grocery 
stores but better control on the integrity of meat and poultry product 
as it moves through transportation, distribution and marketing channels 
to consumers.
    For example, in response to the proposed Pathogen Reduction/HACCP 
regulation, FSIS received many comments supporting the more equitable 
distribution of meat and poultry inspection resources throughout the 
farm-to-table continuum. The proposed rule included temperature 
controls for meat and poultry products during transportation and 
storage; FSIS did not finalize this feature of the proposal, but 
stated: ``FSIS has concluded that its food safety objectives may be 
achieved more effectively by regulatory means other than those proposed 
. . . . FSIS agrees with those commenters who stated that keeping raw 
products cooled after they leave the establishment, during 
transportation, storage, distribution, and sale to consumers is 
essential if growth of pathogenic microorganisms on raw products is to 
be prevented. This is consistent with FSIS's farm-to-table strategy.''
    FSIS intends to develop performance standards for products being 
shipped into commerce. These standards would be applicable to all 
persons who handle such product before the product reaches the consumer 
(61 FR 38856-57, July 25,1996). In addition to a handling performance 
standard for the farm-to-table continuum, FSIS believes that there is 
benefit to be gained by conducting certain retail sampling of meat and 
poultry products just before they reach the consumer. Product leaving 
inspected establishments goes through an often lengthy distribution 
process that involves many transporters, storers and other handlers. 
So, at some future time, FSIS may determine that a greater portion of 
its sampling and subsequent analytic work may need to be directed at 
meat and poultry products in the final stages of distribution. With 
respect to imported products, FSIS believes that its current system for 
control of imported meat and poultry products provides an appropriate 
level of control and is an efficient use of current resources.
    Question. What will the Consumer Safety Officer's role be in the 
farm-to-table food safety initiative, especially in food retail and the 
farm?
    USDA answer. To carry out the farm to table food safety strategy 
FSIS needs to have a flexible, more highly educated workforce that can 
be assigned at any time, and to any industry operation, to perform 
inspection and determine regulatory compliance. FSIS has assessed the 
current deployment of the inspection workforce and determined that 
changes are needed to optimize inspection coverage while maintaining 
our continuous presence in plants. Through this assessment FSIS 
identified the need to establish a new Consumer Safety Officer 
position. The position of Consumer Safety Officer, currently under 
development, will be at a professional level in terms of educational 
requirements and responsibilities. FSIS has focused on introducing the 
Consumer Safety Officer occupation to conduct a broad range of 
regulatory activities, including:
  --participating in special projects such as nationwide initiatives 
        requiring application of professional qualifications, e.g., 
        implementation of a significant new procedure;
  --serving as a member of a team with other professionals in 
        conducting assessments in plants with sensitive compliance 
        issues where previous industry and/or FSIS personnel have been 
        unsuccessful in identifying causes and developing effective 
        corrective actions;
  --visiting Custom Exempt establishments, evaluating them for 
        compliance with applicable regulations;
  --visiting warehouses in order to verify that they are keeping food 
        safe; and
  --fact-finding visits to State-inspected plants to obtain information 
        for FSIS personnel responsible for assuring the ``equal to'' 
        status of such plants.
    To transition the workforce to the CSO position, FSIS plans to 
establish the Consumer Safety Inspector (CSI) position. FSIS plans to 
use CSI's for positions to be established in both the in-plant and in-
distribution pilot test that are part of the HACCP-based Inspection 
Models Project. Consumer Safety Inspectors will be working at both in-
plant and in-distribution sites.
    Under the farm to table strategy FSIS will be using Consumer Safety 
Inspectors to carry out its regulatory responsibilities in verifying 
the safety and wholesomeness of meat and poultry products as they move 
from the plant to the consumer. Under the FSIS's pilot project for 
Consumer Safety Inspectors, the inspector will carry out the following 
in-distribution activities:
  --Conduct scheduled as well as unscheduled reviews of a wide range of 
        diverse commercial operations.
  --Observe meat and poultry products in commerce and control those 
        that are believed to be adulterated, misbranded, or otherwise 
        in violation of the laws and regulations.
  --Conduct recall effectiveness checks.
  --Conduct sampling to verify compliance with FSIS requirements.
  --Conduct follow-up inquiries on consumer complaints.
    The following are examples of verification activities that consumer 
safety inspectors might perform at various commercial locations:
  --At a warehouse, the consumer safety inspector would check inspected 
        meat and poultry products to ensure that labeling meets all 
        Federal requirements and that the products are not being held 
        under conditions that may cause them to become adulterated. For 
        example, the inspector would check to ensure that the products 
        are not being contaminated by a leaky ceiling.
  --At a rendering operation, the consumer safety inspector would 
        ensure that product labeling meets Federal requirements for 
        transporting and handling condemned and inedible products.
  --At a retail location, the consumer safety inspector would ensure 
        that any meat or poultry product that has been recalled is no 
        longer being offered for sale and would ensure that retail 
        operations are complying with retail exemptions from 
        inspection.
  --Ultimately, FSIS intends that CSO's will cover the full range of 
        regulatory activities described for both the CSI and the CSO 
        positions. The transition from Food Inspector to CSI to CSO is 
        intended to accomplish the transformation of the inspection 
        workforce in the most effective manner.
    Question. What is the role of the Joint Institute for Food Safety 
Research? What authority does this body have to prioritize the research 
efforts of member agencies? Does this institute have its own staff? If 
so, how much and from what agency and what account does the Institute 
receive its funding?
    USDA answer. The role of the Joint Institute for Food Safety 
Research, as defined in the Presidential directive of July 3, 1998, is 
``to develop a strategic plan for conducting food safety research 
activities consistent with the President's National Food Safety 
Initiative and efficiently coordinate all Federal food safety research, 
including with the private sector and academia''.
    By agreement between the U.S. Department of Agriculture (USDA) and 
the Department of Health and Human Services (DHHS), the Institute would 
serve as a coordinating body to ensure that research needs of the 
regulatory agencies, the affected industries, and the general public 
are met in a coordinated and most cost effective manner.
    The Institute, as described in an October 1, 1998 report to the 
President, and responded to in a public hearing on December 1, 1998, 
would have an Executive Director and a small staff. The Executive 
Director would report to an Executive Research Committee which in turn 
reports to the President's Council on Food Safety. An advisory 
committee consisting of 16 stakeholder members will report to the 
Executive Director. At the present time, the amount of the funding for 
support of the small Institute staff and operations has not been 
determined. It is proposed that staff and funding will be provided from 
the Food Safety Research Agencies of USDA and DHHS.
    FDA answer. In 1998, the President instructed the Department of 
Health and Human Services and the Department of Agriculture to 
establish the Joint Institute for Food Safety Research or JIFSR to 
serve as a mechanism for coordinating the federal research related to 
food safety. The goals of the JIFSR are to optimize the current food 
safety research investment and infrastructure through coordination of 
planning, budget development, and prioritization, provide enhanced 
scientific support to food safety regulatory agencies in their efforts 
to protect public health, enhance communication among all Federal 
agencies with food safety research responsibility, and encourage the 
development of public and private partnerships with industry and 
academia to efficiently develop and transfer new food safety 
information and technologies.
    JIFSR will be funded jointly through the two Departments. At this 
time, the details of the funding arrangements and the amounts, as well 
as the staffing, have not been worked out by the group tasked with 
developing a plan to fund and staff JIFSR.
    Multi-agency task forces will be the foundation upon which the 
JIFSR will operate. Working through those entities, the Federal food 
safety research agencies will work with food safety and public health 
agencies to identify and prioritize research needs, minimize unplanned 
research redundancies, foster opportunities for multi-disciplinary 
research programs, facilitate the transfer of research accomplishments, 
and promote strategic planning for future food safety research needs 
and initiatives. The establishment of the JIFSR will institutionalize 
and enhance the already considerable coordination among the Federal 
agencies.
    The JIFSR will be a virtual office, with a purposefully limited 
full-time staff. The majority of the work of that staff will be to 
support the multi-agency task forces formed for limited durations to 
address specific assignments and needs. While the details of the 
staffing requirements will not be finalized until May 1999, it is 
anticipated that the full-time staff of the JIFSR will be limited to 
five to six individuals drawn from the member agencies. The exception 
is the Director of the JIFSR. This individual will be an 
internationally recognized food safety researcher recruited for this 
position. The specific mechanisms for funding the JIFSR are still being 
finalized, but will be based on an equitable sharing among the agencies 
conducting research.
    Question. Please distinguish between the pesticide residue data 
programs operated by the Food and Drug Administration and USDA. Please 
also outline funding requirements as proposed in the President's budget 
for each of these programs.
    USDA answer. USDA's Pesticide Data Program (PDP) and the Food and 
Drug Administration's (FDA) Regulatory Monitoring Program have 
different missions. PDP is a statistically-reliable program that 
provides pesticide residue data to evaluate population-based actual 
exposures. The data are used by the Environmental Protection Agency 
(EPA) to conduct realistic dietary risk assessments as required by the 
Food Quality Protection Act of 1996. PDP is used to support the export 
of U.S. commodities in the expanding global environment. FDA's 
Regulatory Monitoring Program is oriented towards enforcement of 
tolerances (maximum allowable pesticide residues in or on food crops) 
and is not statistically representative of the overall residue 
situation for a given crop, pesticide or region.
    One program cannot accomplish both missions because of differences 
in sampling rationales and testing requirements. Sampling for 
enforcement programs over-represent suspected violators, and require 
rapid turn around time for sample analysis. Risk assessment programs 
take into account the general population and can take longer to analyze 
samples to verify extremely low-level results.
    The following is a comparative analysis of both programs:
Sampling:
    FDA generally uses targeted, non-random sampling of products 
oriented primarily towards the enforcement of tolerances. Under these 
conditions, sampling bias may be incurred because sample weighting is 
done to include factors such as commodity or place of origin with a 
history of violations. In addition, the total number of samples of a 
given commodity analyzed for a particular pesticide each year is often 
not sufficient to draw conclusions about pesticide residues in the 
whole volume of that commodity in commerce.
    PDP uses statistically-reliable, unbiased random sampling 
procedures to provide objective comprehensive residue data to produce 
national estimates of pesticide residues. State population figures are 
used to assign the number of samples collected per month. This number 
is constant for each commodity if the commodity is available in the 
marketplace. In general, at least 600 samples of a commodity are 
obtained each year.
Sampling Locations:
    FDA's monitoring program collects samples of domestic products 
close to the point of production and imported products are collected at 
the point of entry into U.S. commerce.
    PDP collects samples as close to the consumer as possible at 
locations such as terminal markets and chain store distribution 
centers. Domestic and imported samples are collected based on 
availability in the marketplace. Probability of site selection is based 
on annual product volumes.
Commodities:
    FDA's monitoring program covers a wide range of commodities and 
collects approximately equal numbers of domestic and imported products. 
Commodities tested by FDA include fruit and vegetables, grain and grain 
products, milk and dairy products, fish and shellfish, various nuts and 
spices, and miscellaneous processed products.
    PDP focuses on high consumption items with emphasis on foods highly 
consumed by infants and children. Products collected by PDP include 
fresh and processed fruits and vegetables, selected grains, and milk.
Laboratory Methodology:
    FDA primarily uses traditional, multi-residue methods with some 
single, selective methods capable of detecting residues at or below 
tolerance levels. No verification of residues is required unless a 
tolerance violation is suspected.
    PDP uses refined multi-residue methods capable of detecting residue 
levels much lower than tolerances. These methods require additional 
steps to allow for detection of residues at trace levels, and 
verification of positive results is required. All data are supported by 
rigorous quality assurance and quality control procedures. PDP also 
conducts an extensive proficiency check sample program to determine 
consistency of results among the participating State and federal 
laboratories.
    FDA answer. FDA's pesticide program entails regulatory monitoring 
designed to enforce the pesticide tolerances established by EPA. 
Domestic samples are collected as close as possible to the point of 
production in the distribution system; import samples are collected at 
the point of entry into U.S. commerce. FDA's pesticide program places 
considerable emphasis on imported products, where experience has shown 
more violations occur. In general, a very low violation rate has 
occurred over the years in both domestic and imported commodities. 
Although processed products are also included in sampling, the emphasis 
is on raw, agricultural products. Raw products are analyzed in the 
unwashed, whole, unpeeled, and raw state. This type of sampling 
provides FDA with a broad view of the entire food supply. In addition 
to monitoring pesticide levels in the food supply, work under the 
pesticide program includes research to develop analytical methods, 
enforcement activities, and cooperative efforts with foreign countries 
to decrease violation rates.
    FDA also conducts its annual market basket survey, the Total Diet 
Study, or TDS, to estimate intakes in representative diets of 14 
different age or sex groups. Because the study has been under way for 
over 30 years, trends can be discerned, such as the decrease in dietary 
levels of DDT and other banned pesticide residues. It also helps to 
identify potential public health issues that warrant changes in 
agricultural practices. FDA has also collected and analyzed a number of 
baby foods in addition to those already covered in the TDS. This TDS 
adjunct survey includes 23 different food items in each market basket 
survey.
    USDA's Pesticide Data Program, or PDP, collects data on pesticide 
residues in foods. The data are used by EPA for its dietary risk 
assessment process and pesticide registration process. It includes a 
limited number of commodities each year and monitors fewer pesticide 
residues at much lower levels than those included in the FDA's 
regulatory program. The samples are collected as close to the point of 
consumption as possible. Most samples tested are domestic. For example, 
approximately 86 percent of samples tested in 1997 were domestic.
    The FQPA legislation authorizes an appropriation of $12 million for 
increased FDA monitoring of pesticide residues in foods for the period 
fiscal year 1997 through fiscal year 1999. However, no additional funds 
have been appropriated. FDA currently utilizes about 117 FTE at a cost 
of $8.6 million.
    Question. This Administration and some of my colleagues have 
advocated giving the Federal Government mandatory recall authority. 
What powers does the Federal government now have to recall food 
products?
    USDA answer. FSIS does not have mandatory recall authority. The 
recall system coordinated by FSIS is voluntary on the part of the 
recalling firm. The voluntary nature of the recall gives the recalling 
firm some discretion as to the exact timing of the recall which could 
compromise the effectiveness of the recall action. FSIS may detain or 
seize adulterated or misbranded product that is in commerce with the 
cooperation of the U.S. attorney's office and the Federal Courts. If a 
firm refuses to recall adulterated or misbranded product after asked to 
do so by FSIS, the Agency may act unilaterally to protect the public 
health by withdrawing inspection, which would shut down the firm's 
operation.
    FDA answer. The only food for which the Agency has explicit 
statutory recall authority is infant formula. Under this authority, FDA 
can request an infant formula recall only in situations that pose a 
hazard to health.
    FDA does not have explicit statutory authority to order the recall 
of other food products. However, the Agency promulgated regulations for 
voluntary recalls in June 1978. Among other things, these regulations 
provide criteria for the health hazard evaluation, the recall 
classification, the need for public warning, and the effectiveness of 
the recall. At the present time, when a firm is not willing to 
voluntarily recall a hazardous product, FDA's alternative is to issue a 
press release and pursue a court injunction to require the firm to 
recall and to stop the violative practice.
    FDA has no statutory recall authority for veterinary or animal 
drugs or feeds. However, we can and do request that firms conduct 
recalls of products that are in violation of the FD&C Act. We also have 
the authority to take enforcement action, or seizure, if no recall 
action is taken.
    It is my understanding that DNA testing has been increasingly used 
to link outbreaks in foodborne pathogens.
    Question. The Detroit Free Press reports that USDA chose not to 
actively publicize its most serious recalls 39 percent of the time. How 
does FSIS decide which food recalls are to be publicized?
    USDA answer. FSIS does provide public notification of all recalls 
by posting a recall notification report (RNR) on its website for all 
recalls it coordinates. The report provides specific information 
regarding the recalled products such as, recalling firm, reason for 
recall, identifying product codes, company contacts, geographic 
distribution, quantity recalled, and classification. The main purpose 
of the RNR is to alert State and local public health officials and 
other responsible parties working in the public health area about 
product that may be hazardous to health.
    FSIS does not issue press releases in all cases. The purpose of 
Agency recall press releases is to quickly alert the public about 
product that may present a serious health hazard that they may have in 
their possession and can identify. Through this tool, the public is 
alerted to the potential problem and advised to return the product to 
the point of purchase.
    In general, FSIS issues press releases for all Class I Recalls 
dealing with products that may be in the hands of the consuming public. 
A Class I Recall may involve only product that is packaged and marketed 
for food service. In these cases, FSIS would not normally issue press 
releases since the product is not in the public's possession, nor is it 
readily identifiable by the public. In fact, issuing press releases in 
many of these cases may be counter-productive by causing confusion 
among consumers. FSIS does conduct recall effectiveness checks to 
verify that the recalling firms, and any subsequent distributors, 
contact any potential holders of the recalled product with instructions 
to immediately stop serving it and to dispose of it appropriately. FSIS 
is currently considering whether it should modify its policy on when it 
will issue a press release.
    Question. An increase of $1 million is requested for FSIS civil 
rights training and programs. Please explain in more detail how this 
funding would be spent.
    USDA answer. Of the $1 million requested, $500 thousand is for 
conducting civil rights training that is mandated by USDA for all 
employees in the areas of disability awareness, sexual harassment, and 
complaint processing procedures. Training the inspection workforce, 
which is dispersed across the nation, necessarily involves travel costs 
and overtime pay for other inspectors to cover trainees' inspection 
assignments. These costs exceed the direct cost of training and require 
additional resources to ensure that mandated training is delivered.
    The remaining $500 thousand will be used by FSIS to improve its own 
civil rights program delivery by addressing the unique environment and 
needs of the FSIS workforce. FSIS, using this additional funding, plans 
to fully implement the Alternative Dispute Resolution (ADR) Program, 
which will provide a process for solving problems at an informal level 
rather than letting them escalate to the stage where a costly 
investigation is required. These funds will also be used for improving 
the civil rights program through training for FSIS managers that is 
geared to the inspection work setting and its inherent stresses.
    Question. Statistics show that the percentage of Salmonella present 
in broilers, swine, ground beef, and ground turkey is lower since the 
implementation of HACCP. What does FSIS attribute to this success?
    USDA answer. As FSIS has consistently maintained, these are limited 
data, and care should be taken in interpreting these statistics. The 
completed sample sets are from the large establishments, and although 
they produce the significant majority of product, they are fewer in 
number than either the small or very small category of establishments 
and their experience may not be typical of the set of all 
establishments. Furthermore, the data analyzed to date reflect 
accomplishments during the first year of HACCP implementation and 
therefore, may not be representative of long run performance.
    Nevertheless, FSIS believes these data indicate that the regulatory 
approach embodied in the PR/HACCP final rule is effective. FSIS 
believes that HACCP provides incentives for establishments to take 
frontline responsibility for the production of safe and wholesome meat 
and poultry products. Establishments which take that responsibility 
seriously and implement HACCP successfully appear to have the capacity 
to significantly improve the microbial characteristics of the raw 
products they produce.
    Question. Twenty-six State inspection programs for meat and poultry 
are overseen and supported by FSIS. These cooperative programs permit 
States to inspect product for distribution within their own boundaries. 
Should a State elect to not participate in this program, does FSIS 
fully fund the inspection for that State? If yes, what is the cost to 
FSIS for each State not in the program?
    USDA answer. FSIS fully funds the cost of mandatory federal 
inspection in States that do not operate cooperative programs. For the 
record, the following table displays the estimated cost by State of the 
federal inspection program for fiscal years 1998 through 2000 under the 
FSIS appropriation, excluding federal matching funds to those States 
operating cooperative inspection programs.
    [The information follows:]

                                 COST OF THE FEDERAL INSPECTION PROGRAM BY STATE
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                                                                       1998            1999            2000
----------------------------------------------------------------------------------------------------------------
ALABAMA \1\.....................................................         $21,661         $22,808         $24,167
ALASKA \1\......................................................  ..............  ..............  ..............
ARIZONA \1\.....................................................           1,232           1,290           1,386
ARKANSAS........................................................          32,126          33,671          35,623
CALIFORNIA......................................................          30,518          31,987          33,840
COLORADO........................................................           9,072           9,508          10,059
CONNECTICUT.....................................................           1,439           1,508           1,596
DELAWARE \1\....................................................           5,224           5,500           5,826
FLORIDA \1\.....................................................           6,558           7,360           7,787
GEORGIA \1\.....................................................          34,619          36,572          38,769
HAWAII..........................................................           1,432          1 ,501           1,588
IDAHO...........................................................           2,769           2,902           3,071
ILLINOIS \1\....................................................          10,941          11,568          12,376
INDIANA \1\.....................................................           6,532           6,901           7,353
IOWA \1\........................................................          20,329          21,352          22,624
KANSAS \1\......................................................          11,205          11,523          12,248
KENTUCKY........................................................           7,170           7,515           7,951
LOUISIANA \1\...................................................           4,385           4,658           4,993
MAINE...........................................................           1,198           1,255           1,328
MARYLAND........................................................           8,104           8,494           8,986
MASSACHUSETTS...................................................           3,662           3,838           4,061
MICHIGAN........................................................           9,092           9,530          10,082
MINNESOTA \1\...................................................          17,091          17,649          18,680
MISSISSIPPI \1\.................................................          15,953          16,736          17,742
MISSOURI........................................................          20,784          21,784          23,047
MONTANA.........................................................           1,325           1,408           1,503
NEBRASKA........................................................          22,110          23,173          24,516
NEVADA..........................................................             393             412             436
NEW HAMPSHIRE...................................................             514             539             570
NEW JERSEY......................................................           6,395           6,703           7,092
NEW MEXICO \1\..................................................           1,019           1,069           1,145
NEW YORK........................................................          13,344          13,986          14,796
NORTH CAROLINA \1\..............................................          20,003          21,200          22,534
NORTH DAKOTA....................................................           1,293           1,355           1,434
OHIO \1\........................................................           7,589           8,100           8,726
OKLAHOMA \1\....................................................           5,918           6,283           6,702
OREGON..........................................................           4,313           4,521           4,783
PENNSYLVANIA....................................................          21,788          22,836          24,160
RHODE ISLAND....................................................             545             571             604
SOUTH CAROLINA \1\..............................................           6,940           7,318           7,787
SOUTH DAKOTA \1\................................................           3,225           3,387           3,600
TENNESSEE.......................................................           7,502           7,863           8,319
TEXAS \1\.......................................................          33,960          35,932          38,168
UTAH \1\........................................................           2,473           2,649           2,831
VERMONT.........................................................             629             573             619
VIRGINIA \1\....................................................          11,647          12,303          13,057
WASHINGTON......................................................           6,269           6,571           6,952
WEST VIRGINIA \1\...............................................           1,895           2,003           2,139
WISCONSIN \1\...................................................           8,490           8,998           9,616
WYOMING \1\.....................................................               3               9              18
DISTRICT OF COLUMBIA............................................          72,190          75,663          80,048
PUERTO RICO.....................................................           3,166           3,319           3,509
VIRGIN ISLANDS..................................................              55              58              61
GUAM............................................................              54              57              60
AMERICAN SAMOA..................................................              54              57              60
N. MARIANA ISLANDS..............................................  ..............  ..............  ..............
MICRONESUA......................................................  ..............  ..............  ..............
OTHER COUNTRIES.................................................             198             208             218
                                                                 -----------------------------------------------
      TOTAL.....................................................         548,299         576,531         611,254
----------------------------------------------------------------------------------------------------------------
\1\ Identifies those 26 States with a State Meat and Poultry Inspection Program.

    Question. What motivates a State to participate in the cooperative 
program?
    USDA answer. States have the potential to provide the optimum 
response to the unique needs of their local small or very small packers 
while also responding responsibly to the public health needs of their 
citizens. State programs may have the potential to provide the most 
responsive ``user friendly'' technical guidance as well as regulatory 
control to very small packers. These local small businesses often lack 
the technical know-how of larger packers which have experts on staff to 
address such issues. The cooperative program is a means to support 
small business in addition to protecting consumers. States may also 
have pride in maintaining their own programs. When these factors fit in 
place, sufficient support may exist to fund such a program.
    Question. The production of animals on the farm is a quality 
control issue that is being addressed by the Animal Production Food 
Safety Staff in FSIS. Please explain what this staff is doing to 
encourage the implementation of this quality control program.
    USDA answer. The Animal Production Food Safety Staff (APFSS) works 
with farm and consumer groups, the agri-business industry, state 
authorities and other USDA agencies to promote the voluntary adoption 
of producer practices that will result in safer animals. APFSS helps 
ensure that research is being conducted to identify practices which 
reduce or prevent human pathogens and residues in or on animals and 
eggs submitted for processing. The APPSS staff also conducts risk 
management outreach activities by focusing on the practical application 
of hazard prevention practices from farm to slaughter.
    The Animal Production Food Safety Staff is FSIS's liaison with the 
animal production community. At the state and local levels, the Animal 
Production Food Safety Staff works with the 50 State Departments of 
Agriculture and State Public Health Departments; academia; practicing 
veterinarians; professional and industry associations and consumer 
groups. The objective is to reach the one million food animal 
producers, the thousands of livestock markets, and satellite industries 
to educate them on the impact of in-plant HACCP systems on animal 
production practices and the importance of quality assurance practices. 
The quality assurance standards adopted by industry will provide HACCP 
plants with information necessary to assess the risks presented by 
animals submitted to slaughterhouses.
    To encourage the adoption of HACCP-compatible quality assurance 
practices, the Animal Production Food Safety Staff provides funds to 
State animal and public health agencies to develop animal production 
food safety local partnerships. Currently 11 states have food safety 
partnership groups addressing how they can best educate producers on 
quality assurance practices and HACCP concepts. These states are 
Colorado, Louisiana, Michigan, Nebraska, New York, Ohio, Oregon, South 
Dakota, Texas, Vermont, and Wisconsin. The Animal Production Food 
Safety Staff also is overseeing demonstration projects evaluating 
pathogen risk reduction practices for non-fed beef (culled dairy beef), 
pork, lamb and broiler commodities and is working closely with Tuskegee 
University (Alabama) to determine the educational needs of small and 
disadvantaged producers.
    Question. Are plants that are operating under HACCP advocating 
changes in the marketing of animals? If yes, which livestock industries 
are being targeted by these plants?
    USDA answer. According to the Final Rule, meat and poultry plants 
must consider hazards reasonably likely to occur before, during and 
after entry into official establishments. With regard to plants that 
are operating under HACCP, some are requiring producers to be educated 
on certain quality assurance practices. Some producers of branded 
products also inspect their suppliers for appropriate records for 
animal drug use and other certified practices assuring the quality of 
their animals. While FSIS does not have specific knowledge of plant 
purchasing activities, we are aware that large pork processing 
facilities are requiring that their suppliers be certified on the Pork 
Quality Assurance Program, Level III, an educational program in the 
production of safe /quality animals. At this stage in the development 
of HACCP, however, this is an exception. In a related matter, we are 
aware that some plants are having producers sign letters of guarantee 
regarding the residue safety of the animals supplied.
    Question. What role does FSIS play in the National Antimicrobial 
Resistance Monitoring System (NARMS)? How much does the fiscal year 
2000 budget request contain for this?
    USDA answer. FSIS believes that slaughter origin Salmonella 
isolates are critical to assessing the extent of human exposure to 
antibiotic resistant bacteria in foods of animal origin. Under HACCP, 
FSIS conducts Salmonella testing of raw products in order to monitor 
plant compliance with pathogen reduction standards. These results are 
reported as positive or negative for Salmonella. Other Agency 
activities, such as participation in PulseNet make additional use of 
Salmonella isolates. These additional uses require that the Salmonella 
isolates be serotyped. FSIS pays for a percentage of its total 
Salmonella isolates to be serotyped at the USDA, Animal and Plant 
Health Inspection Service, National Veterinary Services Laboratory 
(NVSL), in Ames, Iowa. For fiscal year 2000, the Agency estimates 
$100,000 will be required for this and related testing at NVSL.
    To support NARMS, FSIS forwards these serotyped Salmonella isolates 
from each of our field laboratories to the USDA-ARS research laboratory 
in Athens, Georgia, that conducts the antimicrobial resistance testing 
for the veterinary portion of the NARMS program. Beginning in fiscal 
year 1999, FSIS began a baseline sampling program for Campylobacter in 
broilers. The FDA's Center for Veterinary Medicine requested, and FSIS 
agreed, to forward those isolates to the same USDA-ARS research 
laboratory in Athens, Georgia. Agency databases contain the most 
complete information about the establishment and product source of 
these serotyped isolates. Accordingly, the Agency provides NARMS with 
technical support in order to correctly interpret the slaughter origin 
Salmonella and Campylobacter data.
    Question. In January, the inspector's union met with Congressional 
staff and argued that the old system needed to be maintained in its 
entirety in conjunction with HACCP. This is at complete odds with the 
commitments the Secretary of Agriculture, and FSIS have made to 
Congress. How are you working with the union to resolve this dispute, 
and do you anticipate the union's position will slow FSIS' timetable or 
force a policy change?
    USDA answer. In the early 1990's, FSIS' thinking about HACCP and 
its relationship to the existing inspection system was quite different 
than it is today. FSIS believed that HACCP could be implemented as a 
supplement, not a replacement, to the existing inspection system. HACCP 
was viewed as a mandatory industry process control system intended as 
an enhancement to the current inspection system. In fact, the Agency 
signed a memorandum of understanding with the union that confirmed the 
thinking of that time.
    [The information follows:]
                      memorandum of understanding
    In an effort to improve relations and communications with respect 
to the HACCP initiative, the National Joint Council (NJC) and Food 
Safety and Insection Service management are committed to the following:
    (1) HACCP is viewed as a mandator industry process control system, 
not as a system of inspection.
    (2) The implementation of HACCP is intended to be an enhancement to 
the current inspection system and not a substitute for inspection.
    (3) FSIS plans to make HACCP mandatory so that the industry can 
improve food safety, not to reduce the number of inspectors.
    (4) FSIS will support any unit employee when their action causes a 
reduction in plant production due to HACCP non-compliance if the action 
is in accordance with established regulations, directives and guidance.
    (5) To the extent that disagreements arise between the parties 
concerning any aspect of the HACCP initiative, the undersigned will 
first use internal mechanisms to address their concerns. If those 
mechanisms fail, then the parties are free to use alternative methods.
    (6) The parties recognize that circumstances, both those that 
currently exist and those unforeseen, may impact on the commitments 
made above. The parties, therefore, recognize the importance of 
maintaining continued communication concerning HACCP so that changes in 
circumstances can be dealt with in the spirit of a good faith labor 
management relationship.
    Subsequent development of the HACCP regulatory framework and the 
public process through which the Pathogen Reduction and HACCP (PR/
HACCP) final rule was developed led to a different conclusion. That is, 
that the HACCP system must be implemented in a way that would focus 
industry efforts on production of safe products and that would focus 
FSIS regulatory efforts on verifying the effectiveness of the 
industry's HACCP system. Through the public process, it became clear 
that the implementation of HACCP needed to do more than supplement the 
existing inspection system. It must also result in no layering of 
additional regulatory requirements on top of existing regulations. 
FSIS' regulatory reform efforts over the past few years since 
promulgation of the PR/HACCP final rule have focused on eliminating 
such layering.
    The next steps in that process are to determine whether the 
existing inspection system can be further modernized based on the 
existence of industry HACCP systems. In particular, this means 
determining whether traditional slaughter inspection procedures for 
certain market classes of animals can be modernized by industry 
assumption of principal responsibility for food safety concerns at 
slaughter. The HACCP-based inspection models project is focused in part 
on this question.
    The Agency has engaged in an open, public process for the 
development of alternative methods of conducting regulatory activities 
in certain types of slaughter plants. Federal register notices have 
been issued periodically to share Agency thinking and three public 
meetings have been held to date. A new design for inspection work has 
been developed and was the subject of extensive negotiations with the 
union January 5-14 and February 23-25, 1999. The parties were assisted 
by a mediator from the Federal Mediation and Conciliation Service at 
the latter session. Following mediation the parties jointly submitted 
the outstanding issues to the Federal Service Impasses Panel for 
resolution.
    The existence of litigation has not affected FSIS' resolve to seek 
alternative inspection methods that work more effectively in the HACCP-
based production environments of regulated plants. While litigation is 
pending, the Agency is continuing work on developing new inspection 
systems. As progress is made, consultations and negotiations with the 
union are conducted. It is anticipated that the continuing dialogue 
between the Agency and the union throughout all appropriate venues will 
facilitate resolution of differences and permit the introduction of new 
food safety strategies in a timely manner.
    Question. FSIS has initiated HACCP pilot programs in several meat 
and poultry plants to see if new inspection strategies could help in 
the fight against foodborne pathogens. We understand the inspector's 
union is suing the agency over the pilots and that the pilot program 
thus cannot move forward. Has FSIS' commitment to the pilots wavered, 
and how does FSIS propose to resolve the problem so we can begin taking 
advantage of these new food safety strategies?
    USDA answer. No, the Agency's commitment to the pilots has not 
wavered and it anticipates resolution of the outstanding issues with 
the inspectors' union through the Federal Service Impasses Panel. 
Dialogue between the FSIS and the union continues throughout all 
appropriate channels, which will facilitate the resolution of 
differences and permit the timely introduction of new food safety 
strategies.
    Question. Regardless of this impasse, many pilot plants still are 
seeking to implement new technologies in fighting pathogens. We 
understand FSIS is requiring testing protocols before these new 
technologies can be implemented. This flies in the face of FSIS' 
commitment last year to Congress to fast-track technological 
innovations that reduce pathogens. Why does FSIS need to approve 
protocols for the pilot plants when it already has conducted baseline 
microbial testing and can determine by the results of subsequent 
pathogen testing whether the new technology is yielding beneficial 
results?
    USDA answer. Before implementation of the Pathogen Reduction; HACCP 
final rule (PR/HACCP), FSIS approval of protocols for in-plant trials 
of new technologies was required. Under PR/HACCP, FSIS approval is no 
longer required and a plant generally is free to innovate and 
experiment without FSIS prior approval. If requested, FSIS will provide 
technical advice and conduct a review of protocols for in-plant trials 
of new technologies.
    Under the PR/HACCP final rule, the Food Safety and Inspection 
Service's strategy to improve food safety encourages the use of 
innovative technologies to reduce or eliminate pathogens from food. In 
fact, this strategy calls for FSIS to establish food safety standards 
that provide incentives for the food manufacturing and allied 
industries to develop and implement innovations that lead to improved 
food safety. The design of an experiment to test an innovation in-plant 
is the plant's decisions. If a plant decides to conduct an in-plant 
trial, it must accept responsibility for its workers, its products, and 
for providing the information necessary for FSIS to examine the impact 
on inspection procedures and inspector safety. The plant also is 
responsible for ensuring that it conducts the in-plant trial in 
accordance with any applicable regulatory requirements (e.g., OSHA, 
FDA, EPA, requirements). The Agency's role under PR/HACCP is to provide 
regulatory oversight, not approval, of the in-plant trial or the 
innovation. The main purpose of such oversight is to verify that the 
trial or introduction of a new technology will not interfere with FSIS 
inspection personnel's ability to verify that the food is safe or 
compromise the safety of FSIS inspection personnel. This is 
accomplished through the review and clearance of protocols for in-plant 
trials when there is reasonable expectation that inspection procedures 
will be affected or the safety of FSIS inspection personnel is in 
question.
    The only other circumstance in which FSIS has required testing of a 
new technology is if implementation of the technology will require a 
change in FSIS' regulations, for example, use of trisodium phosphate 
for on-line reprocessing has required testing. This testing is 
necessary to provide a basis for a change in FSIS' regulations, which 
do not permit on-line reprocessing of poultry.
    Question. You recently told the House Agriculture Appropriations 
Subcommittee that some meat and poultry plants are resisting the effort 
to remove unnecessary layers of the old inspection system. Could you 
please provide the committee with more complete detail about the types 
of plants that are resisting de-layering and a list of specific 
regulations that plants have told the agency they want to retain?
    USDA answer. A number of establishments have strongly opposed FSIS 
regulatory reform efforts regarding certain regulations. The 
elimination of prior approval for proprietary substances and nonfood 
compounds included within the proposed rule on ``Sanitation 
Requirements for Official Meat and Poultry Establishments'' (62 FR 
45045); the conversion of the historically prescriptive thermal 
processing (canning) requirements into performance standards (9 CFR 
318.300 and 381.300); and the elimination of prior approval for 
equipment included within the final rule on ``Eliminating of Prior 
Approval Requirements for Establishment Drawings and Specifications, 
Equipment, and Certain Partial Quality Control Programs'' (62 FR 45016) 
are among those reforms opposed by certain segments of the industry.
    Question. We have heard concerns about FSIS conducting inspections 
in warehouses and at the retail level. Obviously, no one wants to see 
duplication of state and local efforts, but you seem to feel FSIS has 
an appropriate role to play in such inspections. Please describe for us 
the role you envision for federal inspectors and the ways you think it 
could enhance the safety of the food supply?
    USDA answer. The In-Distribution portion of the HACCP-Based 
Inspection Models Project is designed to redeploy some inspectors 
currently assigned within plants to verify the safety and wholesomeness 
of meat and poultry products as they move to consumers. FSIS envisions 
one fully integrated program that will permit movement of personnel 
between in-plant and in-distribution sites, consistent with farm-to-
table food safety goals. Thus, the in-plant and in-distribution models 
are being developed concurrently and are both essential components of 
the HACCP-Based Inspection Models Project.
    FSIS' goal is to reduce the risk of foodborne illness associated 
with the consumption of meat and poultry products to the extent 
possible. To achieve this goal, FSIS is carrying out a farm-to-table 
strategy that recognizes the need to take steps at each segment of the 
farm-to-table chain to improve food safety. The need to adopt a farm-
to-table strategy was articulated in the Agency's February 3, 1995, 
proposed rule on Pathogen Reduction and Hazard Analysis and Critical 
Control Point (HACCP) Systems. In that document, FSIS stated that as a 
major element of its food safety regulatory strategy:

          ``FSIS must approach its food safety mission broadly, and 
        address potential hazards that arise throughout the food 
        production and delivery system, including before animals enter 
        FSIS-inspected facilities and after meat and poultry products 
        leave those establishments.''

    A significant problem with the current inspection system is that it 
does not fully permit FSIS to allocate resources according to public 
health risk. Thus, where gaps in public health protection are 
identified, the Agency may not be able to respond. For example, there 
are indications that risks to consumers associated with inspected 
products often stem from hazards associated with the handling of 
products during transportation, storage, or retail sale (commonly 
referred to as ``in-distribution.''). It is important that FSIS have 
the ability to focus its resources as appropriate to address the risks 
identified. This flexibility will enhance the overall safety of the 
food supply by addressing hazards that occur after product leaves the 
plant on the way to consumers.
    Question. It is my understanding that DNA testing has been 
increasingly used to link outbreaks in foodborne pathogens.
    (1) Can DNA fingerprinting alone definitively link a food product 
to a human illness'?
    USDA answer. FSIS uses pulsed-field gel electrophoresis (PFGE) for 
``genetic fingerprinting'' of E. coli O157:H7, Salmonella spp. and 
Listeria monocytogenes. This technique is highly discriminative and 
reliable compared to other molecular subtyping methods used for 
foodborne pathogens. FSIS laboratories employ methodology that has been 
approved and standardized by the Centers for Disease Control and 
Prevention (CDC). The CDC standardized methodology is used not only by 
FSIS laboratories, but CDC and participating State public health 
department laboratories as well.
    FSIS actively shares PFGE data with CDC and participates in 
PulseNet, a network of federal and State health department laboratories 
dedicated to the early detection of incipient outbreaks. This 
collective effort has already proven invaluable for protecting the 
public health. Laboratory intercommunication of PFGE data played a 
vital role in implicating ground beef produced by Hudson Foods for a 
cluster of foodborne illness cases in Colorado and other states in the 
summer of 1997.
    (2) Is the Department willing to share pathogenic isolets with the 
food processing industry?
    Answer. It is FSIS policy not to share evidentiary cultures. 
Cultures that are potentially associated with samples pending 
regulatory and/or legal action are considered evidentiary.
    FDA answer. No. DNA ``fingerprinting'' has greatly facilitated 
rapid recognition of foodborne disease outbreaks and identification of 
the sources of outbreak by permitting comparison of bacteria isolated 
from humans and from suspected food using standardized equipment and 
methods. However, DNA ``fingerprinting'' results must be considered 
along with epidemiologic investigation data in making links between a 
food source and human illness. In the absence of epidemiologic data, 
DNA ``fingerprinting'' alone cannot definitively link a food product to 
human illness.
    Bacteria are ``fingerprinted'' by their unique DNA composition 
through a method known as pulsed-field gel electrophoresis (PFGE). DNA 
is extracted from the bacteria and treated with an enzyme that cuts the 
DNA at specific places called restriction sites. The location of these 
restriction sites is unique to each strain of bacteria. The resulting 
pieces of DNA are then separated in an electrical field, resulting in a 
``DNA fingerprint'' resembling a bar code.
    FDA answer. Yes. Once an outbreak investigation is completed and a 
final report has been issued, CDC shares outbreak-associated isolates 
with the company whose product was involved or with an appropriate 
industry trade association. CDC requires the company or the trade 
association to submit an official written request for the isolate(s) 
and certify that it has access to laboratory resources for appropriate 
handling of pathogenic bacteria under recommended biosafety guidelines. 
FDA shares resistant strains with whomever requests them.
    Question. It is my understanding that there have been several 
errors made by FSIS in relation to its testing program and recalls. For 
example, there was a recall that may have actually been a mistake since 
the laboratory in Florida could not ``find'' the E. coli O157:H7 after 
the laboratory said it was in the meat; in another case, FSIS issued a 
press release listing the wrong products, telling consumers to return 
to their grocery stores products that were not even contaminated. What 
are your plans for addressing these problems?
    USDA answer. In the Florida case mentioned, FSIS requested the firm 
voluntarily recall about 359,000 pounds of its ground beef based on the 
following factors: 1) official notice from the Florida State Department 
of Agriculture and Consumer Services that an intact sample of ground 
beef produced at an FSIS inspected plant confirmed positive for 
Escherichia coli O157:H7; 2) the Agency's review of the laboratory 
methods used by the State; and 3) the fact that E. coli O157:H7 is a 
dangerous pathogen.
    The Florida food laboratory made subcultures from the original 
culture and sent them to the Florida health laboratory and the FSIS 
Special Projects and Outbreaks Laboratory. In the course of examining 
the isolates, the FSIS lab did not detect E. coli O157:H7 in the 
subcultures, which are samples of the samples. However, failure by 
other labs to reconfirm original results does not invalidate the 
original confirmed results. Based upon our review of the Florida 
Laboratories method, there is no reason to doubt the accuracy and 
reliability of the original testing procedures that confirmed the 
pathogen in a product sample.
    Although not common, it is possible to ``lose'' E. coli O157:H7 
during the transfer from original culture to subculture. One possible 
explanation is that the original culture contained other organisms that 
outgrew (out-competed) E. coli O157:H7. Because the original culture is 
not available to retest, it is impossible to determine that this 
occurred. However, even if faulty transfer had occurred, this finding 
would not invalidate the original confirmation.
    To address the concerns raised by your question, FSIS has 
instituted a policy of not formally requesting recalls by firms based 
solely on laboratory results from other than FSIS laboratories.
    In cases when third party laboratories report positive pathogen 
findings to us, FSIS makes a diligent effort to collect samples of the 
same ``lots'' of product tested by the reporting laboratory and acts on 
the results of its official samples. In the question you raise about a 
press release that may have listed products incorrectly, the Agency is 
not aware of the specific case referred to. FSIS relies on product and 
coding information provided by the recalling establishments. As you are 
aware, FSIS is also engaged in a public process of reviewing its 
general recall policies and practices. The Agency is currently 
evaluating comments on its proposals from all stakeholders. When the 
analysis is completed, policy decisions will be considered by the 
Department.
    Question. As you are well aware, the General Accounting Office, the 
National Academy of Sciences, and others have concluded that the 
nation's food safety system is ``bureaucratically fragmented'', being 
implemented by over 12 agencies and overseen by 28 different 
congressional committees, and should be reorganized under a single food 
safety authority. Do you agree?
    USDA answer. Recently, the President's Council on Food Safety 
reviewed and responded to the National Academy of Sciences Report 
(NAS). Although the NAS report indicates that many of the NAS committee 
members believe that a single, unified agency headed by a single 
administrator is the most viable structure for implementing the 
``single'' voice concept, the Council response recognizes that there 
may be many other models that would be workable.
    The Council agreed with the goal of the NAS recommendation--that 
there should be a fully integrated food safety system in the U.S. The 
food safety agencies are committed to this goal, and the President's 
Council is confident that its comprehensive strategic plan will be a 
major step toward creating a seamless food safety system. To ensure 
that the strategic plan achieves this goal, the Council will conduct an 
assessment of structural models and other mechanisms that could 
strengthen the federal food safety system through better coordination, 
planning and resource allocation.
    While the Council recognized that certain models of reorganization 
may improve coordination and allow for better allocation of resources, 
any reorganization of food safety activities must consider the non-
food-safety-related responsibilities of each agency and how these 
relate to the food safety responsibilities. Reorganization must not be 
done at the expense of these other responsibilities and activities. The 
Council is concerned that if not done carefully, separating food safety 
from non-food safety activities in each agency could act to weaken 
consumer and environmental protection overall.
    FDA answer. We are aware of the numerous reports over the years 
that have recommended a single food agency or recommended that all food 
safety activities are located together or in one or another existing 
agency. The NAS report recommended a new statute that would establish a 
unified framework for food safety programs with a single official with 
control over all federal food safety resources. The report went on to 
acknowledge that there may be several organizational approaches to 
achieving the goal of a single voice for federal food safety 
activities, with a single agency being only one possibility. The 
President's Council on Food Safety, of which DHHS is a co-chair, 
responded to the NAS report, by voicing the commitment of the food 
safety agencies to achieving a fully integrated food safety system in 
the U.S. In formulating a strategic plan to achieve this goal, the 
Council will evaluate various models of reorganization that may improve 
coordination of food safety activities to be more effective and 
efficient. The Council, echoing concerns expressed in the NAS report, 
pointed out that reorganizations must avoid interfering with the public 
health framework established to identify and respond to infectious and 
non-infectious public health threats whether they are foodborne or not, 
since many of the major foodborne pathogens also produce non-foodborne 
disease. FDA is committed to working within the structure of the 
Council on Food Safety to develop a more coordinated, effective and 
efficient U.S. food safety system.
    Question. Dr. Woteki, you indicate in your prepared statement that 
the Administration has been actively engaged in organizational and 
program changes to improve coordination and eliminate conflicts, 
enhance coordination of responses to public health issues and 
emergencies, and coordinate research planning and prioritization.
    What conflicts and areas for improved coordination have been 
identified? What organizational and program changes have been made by 
the Administration to address these?
    USDA answer. Much has been said about the need for organizational 
and structural change in the intergovernmental system as well as the 
need for more coordination within an improved food safety system. The 
Administration has been actively engaged in organizational and program 
changes to eliminate conflicts, enhance coordination of responses to 
public health issues and emergencies, and coordinate research planning 
and prioritization.
    In 1994, the Congress and Administration cooperated in enacting a 
major reorganization of food safety within USDA, creating the new 
mission area and Office of the Under Secretary for Food Safety, which 
oversees the Food Safety and Inspection Service (FSIS) and the U.S. 
Manager of Codex Alimentarius. Under that legislation, a mission area 
dedicated to public health was created within USDA, and the legislation 
mandated that this office be occupied by an individual with a proven 
background in public health and safety.
    The Food Safety and Inspection Service (FSIS), the USDA regulatory 
agency under the Under Secretary for Food Safety that is responsible 
for the safety of meat, poultry, and egg products, also underwent a 
major reorganization. Among its most significant features were the 
establishment of a more efficient field organizational structure and 
the establishment of a new Office of Public Health and Science to 
provide scientific focus, leadership, and expertise to address the most 
important public health risks related to meat, poultry, and egg 
products.
    Research is also a key component of the President's Food Safety 
Initiative. There have been a number of actions taken by the 
Administration and the Department in the past few years that have 
provided an expanded role for coordinating research in the U.S. food 
safety system.
    The 1994 reorganization of USDA centralized research activities in 
the newly created mission area and the Office of the Under Secretary 
for Research, Education and Economics (REE). Food safety research is 
largely funded through two USDA agencies--the Agricultural Research 
Service (ARS) and the Cooperative State Research, Education and 
Extension Service (CSREES). Together in fiscal year 1998 these agencies 
conducted and funded in excess of $56 million in food safety research. 
The centralized research focus enables the Department to better 
leverage existing funds.
    The REE research activities, both intramural and extramural, are 
intended to meet the need of the regulatory agencies to achieve 
improved food safety via HACCP implementation and other initiatives. To 
that end, ARS, the intramural research arm of USDA, and FSIS have 
yearly food safety and research budget and planning sessions. These 
sessions provide one mechanism to ensure that proposed research 
initiatives address the specific priorities of FSIS. In addition, FSIS 
consults closely with other USDA agencies to ensure that its critical 
research and information needs are being met.
    CSREES supports food safety research via several funding mechanisms 
that include formula funds, National Research Initiative competitive 
grants, special research grants awarded by a competitive process and 
special site-specific grants that are appropriated by Congress. The 
priorities for competitive grants are based on stakeholder input, 
including government agencies in support of their public health 
mission.
    The Administration has also been actively engaged in other 
coordinated research planning and prioritization. In 1998, an 
Interagency Working Group (IWG) on Food Safety Research was created. 
The IWG, co-chaired by USDA and the Department of Health and Human 
Services (HHS), is charged with developing a government-wide 
coordinated strategy for food safety research, including the 
identification of information gaps and priorities for future research. 
The IWG provides a forum for coordination, collaboration, and 
communication in setting and reviewing the Federal research agenda.
    In July 1998, the President directed the Secretary of Agriculture 
and Secretary of Health and Human Services to develop a Joint Institute 
on Food Safety Research (JIFSR). The JIFSR concept provides a mechanism 
for coordinated planning of food safety research among the various 
parts of government and the private sector, as well as fostering 
effective translation of research results into practice. The JIFSR, 
operationally located in REE at USDA, expects to optimize food safety 
research investments, channel Federal resources to research that is 
needed to minimize the impact of current and emerging food safety 
problems, and avoid research redundancies. The JIFSR is currently being 
developed jointly by USDA, HHS, and Office of Science and Technology 
Policy. The program is expected to be fully developed by late 1999. 
FSIS and FDA are in the process of implementing a Memorandum of 
Understanding (MOU) to facilitate appropriate sharing of information 
among senior agency field personnel regarding safe food production in 
these plants. FSIS has a trained inspection force in every Federally 
inspected meat and poultry slaughter and processing plant in the United 
States. In some cases, products are being processed in the same plants 
that fall under the jurisdiction of FDA because they are food products 
that do not contain meat or poultry.
    USDA is also working more closely with its counterparts at the 
Federal, State, and local level to encourage national uniformity in 
food safety standards through support and endorsement of the Food Code. 
Because world trade in agricultural commodities continues to grow, USDA 
is working through the Codex Alimentarius Commission to encourage 
international uniformity in food safety standards. Responsibility for 
oversight of the U.S. manager of Codex is in the Office of Food Safety.
    There are several other areas that are contributing to enhanced 
coordination of public health issues and emergencies that are worthy of 
note including voluntary quality control programs, surveillance, 
outbreak response, and education.
Voluntary Quality Control Programs.
    The Animal Production Food Safety Staff in FSIS is an excellent 
example of developing partnership with states to encourage the 
voluntary implementation of quality control programs at the animal 
production level. The education of small producers is of particular 
concern as we move forward with HACCP implementation in small plants.
Surveillance
    In July 1995, USDA began a collaborative project with HHS, through 
its Centers for Disease Control and Prevention (CDC) and Food and Drug 
Administration (FDA), to collect more precise information on the 
incidence of foodborne disease in the United States. The FoodNet 
Surveillance Network has been expanded under the President's Food 
Safety Initiative, and it is providing valuable information on trends 
in foodborne illness and on the association between cases of illness 
and the types of foods consumed.
    USDA also conducts farm-level surveillance through the Animal and 
Plant Health Inspection Service (APHIS). APHIS has a field force of 
veterinarians who work cooperatively at the state and local level to 
ensure the health of poultry and livestock populations. APHIS' National 
Animal Health Monitoring System has conducted nine science-based 
studies addressing information gaps in the areas of animal health, 
welfare, and production; product wholesomeness; and the environment in 
the cattle, swine, and layer industries.
    The National Antibiotic Resistance Monitoring System was 
established in 1996 as an interagency cooperative activity to monitor 
emerging resistance in foodborne pathogens, beginning with Salmonella. 
The effort is coordinated and directed through HHS by the Food and Drug 
Administration's Center for Veterinary Medicine (CVM) and includes CDC 
and three USDA agencies, ARS, APHIS, and FSIS. Both APHIS and FSIS play 
an integral role in system design and the acquisition of isolates.
Outbreak Response
    In 1998, the Foodborne Outbreak Response Coordinating Group (FORC 
G), a partnership of Federal and State agencies, was established to 
better respond to foodborne illness outbreaks. The role of this 
interagency group, co-chaired by the Under Secretary for Food Safety 
and the Assistant Secretary for Health, is to coordinate and develop 
procedures for managing outbreaks, share information on potential 
sources of outbreaks and pathogens, and coordinate interdepartmental 
action on those issues when necessary.
    Within USDA, the Secretary asked the Under Secretary for Food 
Safety to form and chair an internal Food Emergency Rapid Response and 
Evaluation Team (FERRET), designed to enable USDA to be prepared to 
respond to such emergencies as outbreaks involving foods purchased by 
USDA feeding programs, and formulate plans across mission areas to 
diminish those possibilities in the future.
    PulseNet, the national database of molecular fingerprints of 
pathogens, developed through partnerships involving CDC, FSIS, FDA, and 
State governments, allows a comparison of strains of bacteria to 
determine whether or not there is a single source for outbreaks or 
sporadic cases.
Education
    Improving research, inspection, and surveillance alone will not 
ensure safe food. Education and training for all those involved in 
producing, processing, and distributing food are essential to the goal 
of providing the public with safe food products.
    The President's Food Safety Initiative has spurred new consumer 
education programs within USDA as well as expanded cooperative ventures 
with public and private partners, including other Federal agencies. One 
example is the ``Fight BAC!'' campaign sponsored by the Partnership for 
Food Safety Education, a public-private partnership, with participation 
of both USDA and HHS. In addition, USDA is working through 
organizations such as the Association of Food and Drug Officials (AFDO) 
to provide education to those who handle food at the retail level and 
is carrying out extensive HACCP education for its own and State 
employees involved in inspection.
    USDA is also working with industry to develop science-based food 
safety assurance programs for fresh-cut fruit and vegetable processing 
facilities. USDA is basing its safe food handling education on science. 
Epidemiology information from FoodNet and other sources is helping to 
identify types of foods associated with illness, behaviors that can 
contribute to disease, and populations who are more vulnerable. In 
addition, USDA is increasingly using risk assessments and research data 
to develop accurate and high-priority consumer messages. An example is 
an ARS/FSIS study on the premature browning of ground beef, which led 
to a nationwide education campaign to promote the use of food 
thermometers when cooking hamburger.
    CSREES administers a food safety education program, called the 
National Food Safety and Quality Initiative, in partnership with land-
grant institutions across the United States. This program supports food 
safety education initiatives at all land-grant institutions as well as 
specific education initiatives that reach animal and food handlers 
along the entire farm-to-table chain. In addition, science-based 
programs in HACCP training for the meat and poultry industry are funded 
by CSREES through Fund for Rural America grants and special research 
grants. The scope and focus of these educational programs are developed 
in consultation with stakeholders, including other Federal agencies 
involved in food safety education.
    Question. When will the Administration's report on the proposal to 
consolidate the rules and agencies dealing with food safety be 
complete?
    USDA answer. The President's Council on Food Safety has completed 
its review of the National Academy of Sciences report ``Ensuring Safe 
Food from Production to Consumption.'' The Council submitted a response 
to the President in March and the report is provided for the record.
    [The information follows:]
   president's council on food safety assessment of the nas report: 
           ensuring safe food from production to consumption
Executive Summary
    At the request of Congress, the National Academy of Sciences (NAS) 
conducted a study of the current food safety system to: (1) determine 
the scientific basis of an effective food safety system; (2) assess the 
effectiveness of the current system; (3) identify scientific and 
organizational needs and gaps at the federal level; and (4) provide 
recommendations on scientific and organizational changes needed to 
ensure an effective food safety system. To conduct this study, the NAS 
established a committee and obtained input from federal agencies and 
other stakeholders of the federal food safety system. The NAS issued 
its report on August 20, 1998.
    On August 25, 1998, through Executive Order 13100, the President 
established the Council on Food Safety and charged it to develop a 
comprehensive strategic plan for federal food safety activities and to 
make recommendations to the President on how to implement the plan. 
Also on August 25, 1998, the President directed the Council to provide 
him with an assessment of the NAS report in 180 days. Specifically, the 
President directed:

        ``. . . the Council to review and respond to this report as one 
        of its first orders of business. After providing opportunity 
        for public comment, including public meetings, the Council 
        shall report back to me within 180 days with its views on the 
        NAS's recommendations. In developing its report, the Council 
        should take into account the comprehensive strategic federal 
        food safety plan that it will be developing.''

    In response to the President's directive, the Council established a 
task force consisting of representatives from the following departments 
and agencies: Departments of Agriculture (USDA), Health and Human 
Services (HHS), and Commerce (DOC), Environmental Protection Agency 
(EPA), Office of Science and Technology Policy (OSTP), and Office of 
Management and Budget (OMB). The task force benefited from valuable 
input obtained at four public meetings (Arlington, VA; Sacramento, CA; 
Chicago, IL; and Dallas, TX) and from public comment dockets maintained 
by EPA, USDA/Food Safety and Inspection Service (FSIS), and the HHS/
Food and Drug Administration (FDA).
    In general, the Council finds the NAS report a constructive 
contribution to efforts to improve the effectiveness of the federal 
food safety system through strengthening science and risk assessment, 
strategic planning, and better federal integration with state and local 
governments. In particular, the NAS places appropriate weight 
throughout its report on applying science to the management of 
government food safety efforts. Science must be advanced within the 
context of these competing interests. The NAS report recommends that 
priorities of the nation's food safety system should be based on risk. 
The Council agrees with the report's thesis that a food safety system 
that includes regulation, research and development, education, 
inspection and enforcement, and surveillance should be based on science 
and should use various risk analyses including quantitative and 
qualitative risk assessments and risk management principles to achieve 
such a system.
    The Council recognizes that a food safety system comprised of 
multiple agencies with differing missions and statutory authority may 
increase the potential for uneven adoption and inconsistent application 
of science-based regulatory philosophies. While different applications 
may provide useful information to policy makers relative to the 
effectiveness of various approaches, the Council's strategic plan 
(including its assessment of existing statutes and structures) will 
result in more consistent regulatory measures and philosophies. The 
Council is committed to identifying further improvements that would 
result in a seamless, science-based food safety system.
        recommendation i--base the food safety system on science
    The NAS report recognizes that the United States has enjoyed 
notable successes in improving food safety and that with increasing 
knowledge, many rational, science-based regulatory philosophies have 
been adopted. The report suggests, however, that adoption of these 
regulatory philosophies has been uneven given the fragmentation of food 
safety activities, and the differing missions of the various agencies 
responsible for specific components of food safety. The greatest 
strides in ensuring future food safety from production to consumption, 
the NAS argued, can be made through a scientific, risk-based system 
that ensures surveillance, regulatory, research, and educational 
resources are allocated to maximize effectiveness.
Council Assessment
    The Council strongly endorses this recommendation. Many federal 
food safety programs are already, or are being modified to be, science-
based. The Council recognizes that scientifically robust programs will 
result in better identification of public health needs, and 
determination of the most effective means of reducing public health 
risk, including the most cost-effective opportunities for improvement, 
and improved priority setting.
    The scientific information generated through surveillance, 
research, and risk assessment efforts will result in improved food 
safety only if there is a commensurate strong effort to translate that 
scientific information into practical, usable information at the 
working level, e.g., through guidance or education. This means there 
must be education for all those involved in producing, manufacturing, 
transporting, and preparing food as well as for those persons involved 
in government food safety regulatory activities.
    The Council's goal is to ensure that science-and risk-based 
decision making are central to the Administration's on-going efforts 
and its strategic plan. Considerable improvements have been made over 
the past several years. The strong scientific underpinnings of the 
President's Food Safety Initiative, enactment of the Food Quality 
Protection Act (FQPA), restructuring of food safety agencies within 
USDA, and many individual agency activities such as implementation of 
Hazard Analysis and Critical Control Points (HACCP) programs for meat, 
poultry, and seafood, have strengthened the overall science base of the 
food safety system.
    The Council believes that the necessary elements of a science-based 
program--surveillance, outbreak response, risk assessment, research, 
regulation, inspection, and education--are largely in place, and that 
improvements planned for the next 5-10 years will enhance food safety 
significantly. The Council will consider in its strategic plan the 
following elements of a science-based food safety system:
    Surveillance.--Food safety agencies will continue to develop more 
effective ways to achieve surveillance goals and to monitor the safety 
of the food supply. Although FoodNet (foodborne disease surveillance 
system), PulseNet (foodborne pathogen DNA fingerprinting system), and 
the National Antibiotic Resistance Monitoring System (NARMS) provide 
information never before available in the United States on foodborne 
illnesses and the occurrence of antibiotic resistant pathogens, 
enhanced quantitative data on the entire range of infectious and non-
infectious foodborne hazards will require additional efforts.
    Risk Assessment.--Risk assessment is a valuable tool for setting 
priorities, allocating resources, and making regulatory decisions and 
must be continually improved. For example, EPA will continue to refine 
its risk assessment methods to determine acceptable levels of 
pesticides residues. Under FQPA, this approach has been strengthened to 
further protect all consumers, especially children, from the risks of 
pesticides in their diet. As currently is done for chemical hazards, 
the federal government needs to create and use a national microbial 
risk assessment capability as a means of identifying hazards and 
quantifying risk and assist in creating similar capacities 
internationally.
    Research.--Through the Joint Institute for Food Safety Research, a 
research infrastructure has been established to improve and coordinate 
food safety research activities across the federal government. The 
Institute will continue a critical review of the federally supported 
food safety research that was begun through the National
    Science and Technology Council.--Future goals in the area of 
research include: coordination of research planning; budget development 
and prioritization; scientific support of food safety guidance, policy, 
and regulation; enhanced communication and links among federal 
agencies; and enhanced communication and links with industry and 
academic partners through use of public-private partnerships and 
technology transfer mechanisms.
    Education.--Food safety agencies will expand science-based 
education and training programs for producers, processors, 
distributors, food service and public health workers, health care 
providers, food scientists, and consumers as well as those involved in 
regulatory activities. It is essential to include in these programs new 
scientific information on foodborne hazards and their control and 
effective food safety management strategies.
    Inspection/Preventive Controls.--FSIS and FDA will further improve 
and evaluate the effectiveness of inspections of domestically and 
internationally produced food and will continue to develop and 
implement science-based preventive controls such as HACCP systems and 
the Good Agricultural Practices. Where necessary, regulatory 
requirements will be established, such as additional performance 
standards for pathogen reduction that can be developed as more 
monitoring and surveillance data become available.
    Consistency of Science-Based Standards.--FSIS, FDA, and EPA will 
work toward clear food safety standards nationally and internationally. 
The Conference for Food Protection brings together all 50 states for 
purposes of regulating retail establishments, and the model Food Code 
is gaining wider adoption among the states. Internationally, the Codex 
Alimentarius Commission (CAC) is the primary mechanism through which 
these activities will take place. U.S. food safety agencies should also 
become more active in providing technical assistance to developing 
countries.
    Private Sector Incentives.--The federal and state regulatory 
agencies will work with the private sector to develop new technologies 
to further food safety and to encourage commercial scale-up applicable 
in large and small companies, and industry adoption. Research efforts 
with industry, consumer, academic, and government participation could 
develop and validate new technologies.
    Evaluation.--Evaluating the effectiveness of science based 
regulatory programs continues to be critical. For example, Salmonella 
data from the first year of HACCP implementation in poultry facilities 
show a trend toward fewer contaminated products. Also, by providing 
important information on trends in the incidence of infections with 
foodborne pathogens, FoodNet assists in the evaluation of the effect of 
preventive controls. The effect of preventive controls implemented by 
the processed food industry on the reduction of the number of cases of 
listeriosis was readily apparent in the Centers for Disease Control and 
Prevention (HHS/CDC)-conducted surveillance effort that was a 
forerunner of FoodNet.
    A general challenge for the food safety agencies is that while they 
must be guided primarily by science, the agencies must also consider 
other factors such as technical limitations, statutory mandates, policy 
considerations, budget constraints, practicality, and consumer and 
societal preferences.
Scientific Challenges
    The Council faces a number of challenges in improving the 
scientific base of the food safety system. The following are a few 
examples of challenges that must be met to strengthen the scientific 
underpinnings of federal food safety efforts:
  --New data are required to address the occurrence of emerging 
        pathogens, changes in domestic food habits, a global food 
        supply, and changes in demographics. Specific data needs are 
        difficult to predict and obtain in a timely way. An example is 
        the impact of E. coli O157:H7, which was unknown as a foodborne 
        pathogen 20 years ago, but has been responsible for major 
        outbreaks of foodborne illness in recent years.
  --Gaps exist in our knowledge of microbial pathogens and in our 
        ability to measure their impact on human health. For example, 
        there are gaps in knowledge about the pathogens associated with 
        fresh fruits and vegetables and the routes of contamination.
  --Assessment of the total impact on health of multiple chemicals from 
        multiple sources presents a major scientific challenge. 
        Implementation of the new FQPA standards for pesticide residues 
        requires EPA to assess aggregate risk from food, water, and 
        residential exposure to a single pesticide as well as 
        cumulative risk from multiple pesticides.
  --Gaps exist in our knowledge of effective interventions, prevention, 
        and alternatives that minimize contamination of food. For 
        example, the existing limited body of knowledge about microbial 
        contamination limits the ability to develop on-farm preventive 
        controls and systems of testing. Similarly, with the advent of 
        FQPA, more research is also needed to develop safer pesticide 
        alternatives or crop production techniques in order to promote 
        transition from older pest control techniques that may pose 
        risks to newer, safer ones.
  --Insufficient data exist on the entire range of infectious and non-
        infectious foodborne hazards. Even with the improvements made 
        through FoodNet and PulseNet, enhancement of quantitative data 
        on the entire range of infectious and non-infectious foodborne 
        hazards will strengthen monitoring and surveillance programs 
        for prevention, early identification, and prediction of 
        emerging food safety problems.

    ----------------------------------------------------------------

     Recent changes that Strengthen the Federal Food Safety System 
                            Scientific Base

    USDA 1994 reorganization (separated public health from marketing 
functions)
    HACCP implementation (12/97 seafood and 1/98 meat and poultry)
    FQPA enactment and implementation
    FoodNet/PulseNet established
    FDA Fresh Produce Guidelines released
    Joint Institute for Food Safety Research created
    Research funding increased
    Food Safety Research Database initiated
    Annual Food Safety Research Conference held
    Interagency Risk Assessment Consortium established

    RECOMMENDATION IIA----------------------------------------------

    Congress should change federal statutes so that inspection, 
enforcement, and research efforts can be based on scientifically 
supportable assessments of risks to public health.
    The NAS report identifies a need for a ``national food law that is 
clear, rational, and comprehensive, as well as scientifically based on 
risk'' as a major component of a model food safety system. The report 
concludes it is necessary to revise the current statutes on food safety 
to create a comprehensive national food law under which:
  --Inspection, enforcement, and research efforts can be based on a 
        scientifically supportable assessment of risks to public 
        health. This means eliminating the continuous inspection system 
        for meat and poultry and replacing it with a science-based 
        approach that is capable of detecting hazards of concern.
  --There is a single set of flexible science-based regulations for all 
        foods that allows resources to be assigned based on risk, that 
        permits coordination of federal and state resources, and that 
        makes it possible to address all risks from farm to table.
  --All imported foods come only from countries with food safety 
        standards equivalent to U.S. standards.
    The NAS report states that the laws, particularly what the report 
characterizes as the requirement that there be continuous inspection of 
meat and poultry production through sight, smell, and touch 
(Aorganoleptic@) inspection, create inefficiencies, do not allow 
resource use to reflect the risks involved, and inhibit the use of 
scientific decision-making in activities related to food safety, 
including the monitoring of imported food.
Council Assessment
    The report's recommendation that federal statutes provide agencies 
with authority to make decisions based on scientific assessments of 
risks to the public health is sound. Decisions based on public health 
risk assessments allow agencies to make effective use of science to set 
food safety priorities, allocate resources to higher risk areas, and 
instill consumer confidence that high-risk hazards are being addressed.
    Since the federal food safety regulatory agencies operate under 
very different legislative authorities, the Council will conduct a full 
assessment of these statutes and evaluate the degree of regulatory 
flexibility that already exists. The Council has decided that this 
legislative review will be undertaken as part of the strategic planning 
process. The purpose of the review will be to: 1) examine the 
similarities and differences in federal food safety statutes; 2) 
identify the ``best'' statutory approaches for reducing foodborne 
illness; and 3) assess both gaps and statutory barriers to 
implementation of the plan. The need for statutory changes could then 
be determined, and, if necessary, legislative principles developed 
which would form the basis for discussions with stakeholders and 
Congress. For example, given the recent overhaul of pesticide 
legislation, the Council believes that further statutory changes may 
not be needed for pesticides at this time.
    In some cases, the NAS report misinterprets existing statutory 
requirements. For example, the report concludes that the statutes 
require the current method of organoleptic inspection of all carcasses. 
Even though the current law requires continuous inspection, it does not 
specify how this inspection mandate is to be carried out. The statutes 
do require appropriate inspection of animals prior to slaughter and 
inspection post-slaughter at all official slaughter and processing 
facilities. Among other significant food safety purposes, this 
continuous inspection requirement ensures use of the best sanitary 
dressing processes, prevention of fecal contamination, and prevention 
of meat from diseased animals from entering the food supply. Under the 
statutory flexibility that already exists, USDA has begun to develop 
and test a more risk-based inspection system, including adopting 
regulations requiring that HACCP be implemented in all slaughter and 
processing plants. In addition, USDA is studying how best to effect 
further improvements in the inspection of meat and poultry.
    The food safety agencies have achieved and can continue to 
accomplish significant science-based improvements in their food safety 
programs under current authorities. However, new authorities that would 
improve the federal food safety system have been proposed by the 
President and are waiting action by Congress. Further analysis of the 
statutes may result in additional proposed statutory modifications.
Current Legislative Challenges
    As part of its review of food safety statutes, the Council will 
focus on areas where regulatory jurisdiction is split between agencies 
and where resources could be more effectively shared between agencies. 
The Administration will work with Congress to pass:
  --the Food Safety Enforcement Enhancement Act, forwarded by the 
        Clinton Administration and introduced during the last Congress 
        to increase the enforcement capabilities of FSIS; and
  --legislation that gives FDA increased authority to effectively 
        assure the safety of food imports.

    ----------------------------------------------------------------

  Recent Advances in Applying Scientific Assessments of Public Health 
                          Risks to Food Safety

    HACCP implemented for meat, poultry, and seafood
    FQPA tolerance reassessment based on aggregate exposure, cumulative 
risk, and vulnerable subpopulations.
    Single, risk-based pesticide standard for raw and processed food 
established
    Tolerance reassessment focusing on the riskiest pesticides first
    Priority registration given to ``safer'' pesticides
    Risk Assessment Consortium established
    FoodNet/PulseNet established Good Agricultural Practices guidance 
for fresh produce established Unpasteurized juice warning labels 
required

    RECOMMENDATION IIB----------------------------------------------

    Congress and the Administration should require development of a 
comprehensive national food safety plan. Funds appropriated for food 
safety programs (including research and education programs) should be 
allocated in accordance with science-based assessments of risk and 
potential benefit.
    This recommendation contains two parts. The first part recommends 
that Congress and the Administration require preparation of a 
comprehensive, national food safety plan. The NAS report lists several 
essential features of such a plan, including a unified food safety 
mission; integrated federal, state and local activities; adequate 
support for research and surveillance; and increased efforts to ensure 
the safety of imported foods. The second part of the recommendation 
stresses that resources should be allocated on the basis of science-
based assessments of risk and potential benefits.
Council Assessment
    The Council agrees that a comprehensive national food safety 
strategic plan should be developed and the development of such a plan 
is underway. In fact, the President's Food Safety Initiative was an 
initial step toward a national food safety plan. The 1997 Farm to Table 
report was a means of leveraging federal food safety resources through 
coordinated planning and cooperative work to meet common needs such as 
development of surveillance data, response to outbreaks, research into 
preventive interventions, development of risk assessment techniques 
particularly for microbial risk assessments, and consumer education. 
This initial plan also took some steps toward extending food safety 
planning to the state and local level.
Strategic Planning
    Picking up where the Farm to Table report left off, the Council 
will continue and expand the strategic planning process. One of the 
Council's primary purposes is to develop a comprehensive strategic plan 
for federal food safety activities that contains specific 
recommendations on needed changes, including goals with measurable 
outcomes. The plan's principal goal is to enhance the safety of the 
nation's food supply and protect public health through a seamless 
science-and risk-based food safety system. The plan will set 
priorities, improve coordination and efficiency, identify gaps in the 
current system and mechanisms to fill those gaps, continue to enhance 
and strengthen prevention strategies, and develop performance measures 
to show progress.
    Preparation of the food safety strategic plan will be a public 
process, and will consider both short-and long-term issues including 
new and emerging threats and the special needs of vulnerable 
populations such as children and the elderly. Once the plan is 
sufficiently complete, the Council will advise agencies of priorities 
for investing in food safety and ensure that federal agencies annually 
submit coordinated food safety budgets to OMB to sustain and strengthen 
existing capacities. In short, the President's Council on Food Safety 
will develop a national food safety plan and make budget 
recommendations to agencies and OMB to accomplish what the NAS report 
recommends.
    The Council has defined the scope of future federal level food 
safety strategic planning and a process for interagency planning and 
public participation. An interagency task force anticipates having a 
draft plan ready for public review and discussion in January 2000. Even 
while developing this plan, the task force intends to continue its 
consultations with stakeholders. The following is the draft vision 
statement for the Council's strategic plan:
  --Consumers can be confident that food is safe, healthy, and 
        affordable. We work within a seamless food safety system that 
        uses farm-to-table preventive strategies and integrated 
        research, surveillance, inspection, and enforcement. We are 
        vigilant to new and emergent threats and consider the needs of 
        vulnerable subpopulations. We use science-and risk-based 
        approaches along with public/private partnerships. Food is safe 
        because everyone understands and accepts their 
        responsibilities.
    The President's Council on Food Safety held four public meetings in 
the Fall of 1998 in Arlington, VA; Sacramento, CA; Chicago, IL; and 
Dallas, TX to solicit comments on this draft vision for food safety and 
to identify a strategic planning process, goals and critical steps as 
well as potential barriers to achieving that vision.
    The Council's strategic planning task force is analyzing the 
transcripts of the 1998 public meetings and the input received through 
the notice and comment process to determine the major themes, issues, 
and subject areas. The task force will also consider the conclusions 
and recommendations of the NAS report, input from the federal, state, 
and local government integrated National Food Safety System Project, 
and input from the agencies involved.
    The planning process will build upon common ground and provide the 
forum to tackle some of the difficult public health, resource, and 
management questions facing the federal food safety agencies and our 
state, tribal and local government partners. The plan will identify 
areas for enhanced coordination and efficiencies, determine whether 
legislative changes would be beneficial, and clarify federal, state, 
tribal, and local government roles and responsibilities in the national 
food safety system (see discussion under recommendation IIIb).
    The strategic planning process will consider thoroughly the results 
of the legislative review outlined under the Council's assessment of 
NAS recommendation IIa. Examples of possible legislative proposals from 
such a review include:
  --developing legislative proposals to eliminate current duplication 
        of efforts by FDA and FSIS by reevaluating each agency's role 
        in areas such as the regulation of eggs and egg products, game 
        meats, food additives, animal drugs and biologics, and food 
        products produced in plants under the jurisdiction of both 
        agencies;
  --modifying statutes to facilitate greater leveraging of agency 
        resources;
  --developing a legislative proposal giving FSIS explicit authority to 
        enter into cooperative agreements for food safety risk 
        assessment; and
  --developing legislation that provides Performance Based Organization 
        (PBO) authority for voluntary seafood inspection.
Allocation of Resources
    The NAS report recommendation goes a step further than a national 
plan by urging that resources be allocated according to science-based 
assessments of risk and potential benefits. As stipulated in Executive 
Order 13100, the Council will ensure that agencies develop a 
coordinated food safety budget submission consistent with the strategic 
plan. The Council will develop guidance for food safety agencies to 
consider during the preparation of their individual budgets. The 
Council has created a budget task force that will:
  --work with the strategic planning task force and review the draft 
        and final strategic plans and Council budget guidance on 
        priority areas for investment to identify budget data and other 
        information that will be necessary to plan and coordinate 
        agency budget submissions to OMB;
  --design a uniform format for presenting food safety initiative 
        budget components in the OMB budget process for use in both 
        individual agencies and the unified budget submissions;
  --develop necessary guidance to facilitate submission of a unified 
        food safety initiative budget and any other food safety issues 
        deemed appropriate by the Council;
  --establish a timetable for developing coordinated food safety budget 
        requests and for submitting information to the Council that 
        accommodates the various agencies' budget planning processes; 
        and
  --consider the issue of whether to amend OMB Circular No. A-11 (OMB 
        guidance to agencies on budget structure and reporting 
        elements) to include food safety as a budget cross-cut.
Comparative Risk Assessment
    An important part to both risk-based planning and resource 
allocation will be the development of a comprehensive comparative risk 
assessment of the food supply. The Council has requested the 
Interagency Food Safety Risk Assessment Consortium, which consists of 
HHS and USDA agencies and EPA, to consider how to develop a comparative 
risk analysis for food safety strategic planning. The Council will 
direct the Consortium to seek and consider public input in its 
analysis.
    The Council believes that various steps may need to be taken to 
evaluate risks including: a ranking of foodborne pathogen risks based 
on surveillance and economic data; consideration of a broader range of 
food safety hazards including not only microbial risks, but also 
pesticides and chemicals; and finally, selection of highly ranked 
hazards, an evaluation of control measures, and an evaluation of net 
benefits. The Council must avoid applying risk assessment in a manner 
that is too strict, rigorous, or inflexible. Instead, the comparative 
risk assessment must be used to prioritize the known greatest risks at 
the current time, with the understanding that scientific risk estimates 
can, and will likely, change frequently over time.
Challenges in Planning
    The Council faces the following challenges in developing a 
comprehensive food safety strategic plan and allocating resources based 
on risk:
  --Developing and successfully implementing a national plan will 
        require strong cooperation, coordination, and communication, 
        since each federal, state, and local agency has unique 
        mandates, authorities, history, culture, and operating 
        procedures.
  --The diversity of stakeholders in food safety is enormous. It will 
        be difficult, but imperative, that all stakeholders are 
        represented in the Council's planning process.

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                     Progress in Strategic Planning

    President's 1997 Farm to Table Food Safety Initiative
    President's Fresh Produce and Imported Food Safety Initiative
    Establishment of the Joint Institute for Food Safety Research
    Establishment of the President's Council
    Input from the National Academy of Sciences, Council of 
Agricultural Science and Technology, and other organizations
    National Integrated Food Safety System project meetings
    Development of a draft vision statement
    Input from multiple public meetings and public comments

    RECOMMENDATION IIIA---------------------------------------------

    To implement a science-based system, Congress should establish by 
statute a unified and central framework for managing federal food 
safety programs, one that is headed by a single official and which has 
the responsibility and control of resources for all federal food safety 
activities, including outbreak management, standard-setting, 
inspection, monitoring, surveillance, risk assessment, enforcement, 
research, and education.
    The NAS report finds that the existing regulatory structure for 
food safety in the United States is not well equipped to meet current 
challenges. Specifically, it points out that the system is facing 
tremendous pressures with regard to:
  --emerging pathogens and ability to detect them;
  --maintaining adequate inspection and monitoring of the increasing 
        volume of imported foods, especially fruits and vegetables;
  --maintaining adequate inspection of commercial food services and the 
        increasing number of larger food processing plants; and
  --the growing number of people at high risk for foodborne illnesses.
    The report cites the strengths of the current food safety system, 
including the advent of FoodNet and PulseNet, HACCP implementation, and 
the Partnership for Food Safety Education. It also identifies 
deficiencies, which it attributes partly to ``the fragmented nature of 
the system.'' The report attributes the fragmentation largely to a lack 
of adequate integration among the various federal agencies involved in 
the implementation of the primary statutes that regulate food safety, 
and observes that this lack of adequate integration occurs also with 
state and local activities. The report notes that several federal 
agencies are involved in key food safety functions and references more 
than 50 memoranda of agreement between various agencies related to food 
safety.
    The NAS report attributes the lack of adequate integration among 
federal, state and local food safety authorities in part to the absence 
of ``focused leadership'' that has the responsibility, the authority 
and the resources to address key food safety problems. The report 
presents several examples of possible organizational structures to 
create a single federal voice for food safety. These include:
  --a Food Safety Council with representatives from the agencies with a 
        central chair appointed by the President, reporting to Congress 
        and having control of resources;
  --designating one current agency as the lead agency and having the 
        head of that agency be the responsible individual;
  --a single agency reporting to one current cabinet-level secretary; 
        and
  --an independent single agency at cabinet level.
    Although the report indicates that many of the NAS committee's 
members believe that a single, unified agency headed by a single 
administrator is the most viable structure for implementing the 
``single voice'' concept, the report recognizes that there may be many 
other models that would be workable.
Council Assessment
    The Council agrees with the goal of the NAS recommendation--that 
there should be a fully integrated food safety system in the U.S. The 
food safety agencies are committed to this goal, and the Council is 
confident that its comprehensive strategic plan will be a major step 
toward creating a seamless food safety system. To ensure that the 
strategic plan achieves this goal, the Council will conduct an 
assessment of structural models and other mechanisms that could 
strengthen the federal food safety system through better coordination, 
planning, and resource allocation.
    The Council's strategic plan will bring agreement on the vision, 
goals, and actions needed to enhance the safety of the nation's food 
supply and protect public health by reducing the annual incidence of 
acute and chronic foodborne illness. It will also clarify the roles and 
responsibilities of each food safety agency as well as their 
interactions with state, tribal, and local government partners.
    While the Council recognizes that certain models of reorganization 
may improve coordination and allow for a better allocation of 
resources, any reorganization of food safety activities must consider 
the non-food-safety-related responsibilities of each agency and how 
these relate to the food safety responsibilities. Reorganization must 
not be done at the expense of these other responsibilities and 
activities. The Council is concerned that, if not done carefully, 
separating food safety from non-food safety activities in each agency 
could act to weaken consumer and environmental protection overall.
    The Council also recognizes that expertise and knowledge, 
particularly expertise in state-of-the-art science and technology, 
provides a resource to food safety activities. For example, analytical 
methods for detection and quantification of adulterants in foods may be 
adapted to detection of chemical contaminants that threaten public 
health. Expertise in non-food safety regulatory science and legal 
procedures are critical when warnings are required on food labels to 
assure safety. In addition, reorganizations must avoid interfering with 
the public health framework established to identify and respond to 
infectious and non-infectious public health threats whether they are 
foodborne or not, since many of the major foodborne pathogens also 
produce non-foodborne disease. Thus, in its strategic planning the 
Council will be cognizant of the interplay between the food safety and 
non-food safety activities of each agency and how they affect each 
other.
    The Council believes that there are programs that can benefit from 
immediate reorganization. For example, during the last two years, FDA 
and NOAA have been developing a proposal to transfer the NOAA Seafood 
Inspection Program to FDA as a Performance Based Organization (PBO) in 
order to operate the voluntary Seafood Inspection Program on a more 
business-like basis. The PBO would be formed under the umbrella of FDA 
and would include all seafood inspection activities now carried out by 
NOAA. The fiscal year 2000 budget proposes to transfer the existing 
Seafood Inspection Program from NOAA to FDA. This action will fully 
consolidate federal seafood inspection activities within one agency 
thereby increasing the efficiency and effectiveness of seafood 
oversight. It will also enhance the overall safety and wholesomeness of 
seafood products. Funds are provided in the President's fiscal year 
2000 budget to cover the costs of transition, including training and 
education activities.
Factors to Consider in Organizational Restructuring
    The Council assessment of structural and organizational options 
must take into consideration factors such as:
  --There are numerous instances in the existing food safety system 
        where the division of regulatory responsibility is not optimal. 
        For example, within the same plant, FSIS and
  --FDA inspectors are often responsible for different foods. FDA and 
        FSIS also share regulatory responsibility of eggs and egg 
        products. Examples such as these create stakeholder confusion 
        and inefficient allocation of resources. Any reorganization 
        must consider areas where there is significant jurisdictional 
        overlap.
    Many food safety issues would be difficult to resolve by a 
reorganization. For example, some issues like bovine spongiform 
encephalopathy are both animal health issues and human health issues. 
Foodborne disease problems may also be waterborne disease problems. 
Other programs, particularly research and education programs for food 
safety often do not operate as separate activities within the agencies, 
but rather draw significant strength from one another. While some 
projects are entirely focused on food safety, the food safety research 
portfolio includes many other projects in such areas as animal health 
and animal genetics. Reorganization must also accommodate successful 
partnerships such as the Partnership for Food Safety Education.

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   Recent Steps Taken to Create a Unified Federal Food Safety System

    1997 President's Food Safety Initiative implemented
    Interagency Risk Assessment Consortium created
    President's Fresh Produce plan implemented
    Federal/State Outbreak Response task force established
    Joint Institute for Food Safety Research created
    President's Council on Food Safety established
    Restructuring of seafood inspection proposed
    Partnership for Food Safety Education created

    RECOMMENDATION IIIB---------------------------------------------

    Congress should provide the agency responsible for food safety at 
the federal level with the tools necessary to integrate and unify the 
efforts of authorities at the state and local levels to enhance food 
safety.
    The NAS report recommends that federal, state, and local 
governments function as an integrated enterprise, along with their 
partners in the private sector. The report identified five statutory 
tools required to integrate federal, state, and local food safety 
activities into an effective national system:
  --authority to mandate adherence to minimal federal standards for 
        products or processes;
  --continued authority to deputize state and local officials to serve 
        as enforcers of federal law;
  --funding to support, in whole or in part, activities of state and 
        local officials that are judged necessary or appropriate to 
        enhance the safety of food;
  --authority given to the Federal official responsible for food safety 
        to direct action by other agencies with assessment and 
        monitoring capabilities; and
  --authority to convene working groups, create partnerships, and 
        direct other forms and means of collaboration to achieve 
        integrated protection of the food supply.
    This recommendation acknowledges the ``equally critical roles'' of 
state, tribal, and local government entities with those of the federal 
government in ensuring food safety, and suggests that changes in 
federal authorizing and appropriating legislation may be necessary to 
achieve better integration of federal, state, tribal, and local 
activities. The report points out that the work of the states and 
localities in support of the federal food safety mission deserves 
``improved formal recognition and appropriate financial support.''
Council Assessment
    The Council agrees that the roles of state, tribal, and local 
governments in the food safety system are critical and that their 
efforts deserve the formal recognition that partnership in a national 
food safety system conveys. Thus, the Council supports steps taken 
toward the development of a more fully integrated national food safety 
system. While more needs to be done to optimize and develop new 
partnerships, the federal food safety agencies have already established 
extensive interactions with state and local regulatory agencies. In 
fact, a critical factor for the Council to consider is the manner in 
which existing federal/state or local activities are integrated and 
coordinated. The Council believes that its strategic planning process 
provides a fresh opportunity for their non-federal partners to 
participate as primary and equal partners in the development of the 
future food safety system.
    Some overlap occurs among federal, state, and local food safety 
efforts. Neither federal food safety agencies nor state and local 
agencies have sufficient resources to carry out a comprehensive food 
safety program, but all these agencies have expertise and resources 
that, when combined in an integrated program, would significantly 
enhance the impact of food safety programs.
    The Council also agrees that the five statutory tools identified by 
the NAS are critical for ensuring good coordination between the federal 
government and state, tribal, and local agencies. Fortunately, the 
federal food safety regulatory agencies (FDA, FSIS, and EPA) already 
have most of the statutory tools recommended by NAS.
    The Council recognizes and agrees with the report's conclusion that 
the lack of integration among federal, state, and local authorities 
often complicates the administration of regulatory programs. We need to 
utilize available mechanisms to leverage resources and expertise from 
government, industry, academia, and consumers to expand the nation's 
food safety capabilities beyond what any one group can accomplish. 
Increased awareness and knowledge of food safety in each segment of the 
food safety community should reduce the need for regulation of industry 
and decrease the incidence of contamination at every point in the food 
safety system in order to protect public health.
Integrated National Food Safety System (NFSS) Project
    HHS, USDA, and EPA are working with state and local officials on an 
integrated National Food Safety System (NFSS) Project to identify 
appropriate roles and to develop mutually supporting common goals for 
all levels of government in the U.S. food safety system. This work is 
considered integral to the Council's strategic plan and coordinated 
budget recommendations and will be the basis for improved integration 
with state, tribal and local governments.
    Under the leadership of the FDA, the Project is proceeding under 
existing federal, state, and local laws although all levels of 
government recognize that changes in some of the federal and state laws 
will be necessary to achieve an integrated system. The Project began 
with a meeting of state and local officials from public health and 
agriculture agencies and state laboratories representing all 50 states, 
Puerto Rico, and the District of Columbia, FDA, CDC, and FSIS in Kansas 
City in September 1998. In December 1998, six work groups and an 18 
member Coordinating Committee composed of federal, state and local 
officials met in Baltimore, Maryland to begin to develop plans for 
implementing recommendations and overcoming the obstacles identified at 
the Kansas City meeting. Subsequent meetings will be held throughout 
1999 to continue the planning process. The group estimates that a fully 
integrated federal/state/local food safety system will take up to 10 
years to build. The Association of Food and Drug Officials, which is an 
organization of state and local public health officials and regulators, 
strongly endorses the concept of a NFSS.
    The NFSS Project builds on existing systems of federal/state 
cooperation such as the FSIS long-term ``equal to'' meat and poultry 
system currently operating in 26 states with shared state and federal 
funding and EPA's delegation to states of various regulatory programs.
Challenges to Developing a National Food Safety System
    The Council recognizes that the existing systems for federal, 
state, and local government regulation of food and pesticides have 
different histories and important distinguishing characteristics. The 
Council believes it is important to respect the nature and strengths of 
the existing systems and that integration must proceed in a coordinated 
fashion. There are numerous challenges to building an integrated food 
safety system:
  --Establishment of a clear framework for integration.--Such a 
        framework would include the following: strong federal food 
        safety standards, consistent training and competency of 
        inspectors and other state/local officials, data sharing/
        exchange, federal oversight of state activities, and 
        appropriate and effective enforcement. There needs to be public 
        assurance that state and local activities are integrated with, 
        and an extension of, the federal responsibility in order to 
        assure consistency, accountability, and above all, enhanced 
        consumer protection.
  --Responsiveness to stakeholder concerns.--Development of an 
        integrated system needs to be responsive to stakeholder 
        concerns to have credibility and obtain public support. For 
        example, consumers are concerned that the economic interests of 
        industry within states may be a source of conflict if those 
        states have an expanded food safety role that includes 
        activities thought to be primarily a federal responsibility. 
        Moreover, industry is concerned that food safety regulation 
        will be inconsistent among the states if systems are integrated 
        without adequate preparation of the state agencies to step into 
        an expanded food safety role.
  --Infrastructure and support.--There is a potential need for 
        legislative change at the federal or state/local level to 
        achieve uniformity and consistency in enforcement authorities 
        and to permit the sharing of inspection and other resources.

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              Examples of Federal/State/Local Cooperation

    Milk Sanitation Program--Pasteurized Milk Ordinance
    Retail Food Safety Program--Food Code
    Integrated National Food Safety System Project
    Interstate Shellfish Sanitation Program
    States conduct 5,000 inspections of FDA-regulated plants
    FSIS oversee and supports 26 state ``equal to'' meat and poultry 
inspection programs
    FDA maintains more than 100 state partnerships
    Conference for Food Protection
    FoodNet/Emerging Infections Program
    PulseNet
    Epidemiology and Laboratory Cooperative Agreements
    Appropriate delegation of pesticide responsibility to states
    Partial funding of states for implementation of some pesticide 
programs and for most pesticide compliance programs
    State FIFRA Issues Research and Evaluation Group
    State and local government involvement in Foodborne Outbreak 
Response Coordination Group (FORC-G)
    States conduct inspections in 250 FSIS regulated plants
    FSIS supports animal production food safety outreach projects 
involving 11 states
    FSIS supports animal production food safety workshops
    HACCP based enhancement of state labs, computer capabilities, and 
state training
    Partnership for Food Safety Education ``Fight BAC!'' campaign

    FOOD IRRADIATION------------------------------------------------

    FDA answer. The Council on Food Safety has developed a process for 
developing a 5-year strategic plan that includes steps necessary to 
achieve a fully integrated U.S. food safety system. As part of this 
process, the Council will assess structural models and other mechanisms 
that could strengthen the federal food safety system through better 
coordination, planning, and resource allocation. The timeline 
associated with this process calls for the strategic plan to be 
presented to the public for comment in January 2000 and the final plan 
to be presented to the Council for approval in July 2000.
    Question. While irradiation isn't a ``magic-bullet'', it is one 
extra step we can take to assure the safety of food products. What is 
being done to dispel consumer misconceptions about irradiation? Is this 
being done as part of the food safety education effort? If not, why?
    USDA answer. Where food irradiation is concerned, dispelling 
misconceptions is a key component of consumer education. FSIS has been 
doing this for quite some time through the usual communications 
channels: Consumer publications (for example, Ten Most Commonly Asked 
Questions About Food Irradiation, September 1992) The Meat and Poultry 
Hotline (1-800-535-4555) FSIS Web site (http://www.fsis.usda.gov/OA/
topics/irrmenu.htm) Backgrounders (for example, Poultry Irradiation and 
Preventing Foodborne Illness, May 1992/Slightly Revised September 1992, 
or USDA Issues Meat and Poultry Irradiation Proposal, February 1999)
    When the proposed rule on red meat irradiation was published in the 
Federal Register on February 24, 1999 (64 FR 9089) both the proposal 
and a ``Review of Risk Analysis Issues'' document were made available 
to the public through the FSIS Constituent Update. The FSIS Constituent 
Update is a mechanism for faxing FSIS information to more than 300 
consumer, industry, and allied organizations. Informational documents 
were also made widely available to the public through the FSIS Web 
site. These included a review of risk analysis issues that addressed 
particular consumer concerns: food safety, environmental impact, worker 
safety, and transportation safety.
    Answer. The FDA has been particularly active in its efforts to 
educate the public about the irradiation process. For example, last 
spring Dr. Michael Friedman, as lead Deputy Commissioner, was featured 
in the major television spots on the recent approval of meat 
irradiation. Dr. Friedman stressed the strong scientific basis for 
FDA's conclusion that irradiation of meat is safe. In addition, FDA 
staff handled a variety of print and broadcast interviews where they 
explained that irradiation has been shown to be safe and to 
significantly reduce bacterial contamination. They also made numerous 
presentations on this technology to scientific organizations and 
consumer groups. We value the importance of informing consumers. 
Nevertheless, we believe it is critical that consumer education efforts 
remain balanced and objective so irradiation and other antimicrobial 
interventions are placed in the proper context in the overall effort to 
ensure food safety.
    Over the years, FDA experts on food irradiation have been made 
available to many requests for interviews from the press and broadcast 
media. These experts have also spoken at several professional meetings 
of food safety scientists and educators. FDA's Office of Public Affairs 
prepared a series of consumer oriented articles for its FDA Consumer 
magazine and is in the process of preparing a consumer education 
brochure on this issue. These efforts date back prior to the current 
food safety education effort and continue.
    Question. To what extent is irradiation used now, both here and 
abroad?
    USDA answer. FSIS estimated in the proposed rule on red meat 
irradiation that a low volume (i.e., one percent) of the U. S. poultry 
is irradiated (64 FR 9099). FSIS attributed this low volume of 
irradiated poultry, in part, to command-and-control pre-HACCP 
regulations governing the irradiation process. The FSIS red meat 
irradiation proposal included several substantive proposed changes to 
the poultry irradiation regulations that would make the poultry 
irradiation regulations more consistent with those proposed for red 
meat irradiation, as well as with HACCP regulations.
    Regarding the extent to which irradiation is used abroad, more than 
35 countries allow food, including meat and poultry, to be irradiated. 
As of 1994, the year in which the Joint FAO/IAEA report by the 
International Consultative Group on Food Irradiation was issued, seven 
countries had specific clearances for meat, 15 countries had clearances 
for poultry, and six countries had clearances for both meat and 
poultry. No data are available regarding the volume of meat and/or 
poultry irradiated.
    FDA answer. The use of irradiation to process food has been 
relatively minor, both in the U.S. and abroad. At present, irradiation 
facilities can handle only a small proportion of food and most of the 
irradiation capacity has been used to sterilize medical supplies. We 
are aware of the use of irradiation to sanitize some spices although a 
larger fraction has been treated with fumigants such as ethylene oxide. 
We are also aware of one facility that has irradiated poultry and 
fruits and another that has irradiated fruits from Hawaii to prevent 
introduction of insect pests on the mainland.
    Question. To what extent does irradiation kill pathogens? What 
about viruses?
    USDA answer. Irradiation, at the absorbed dose level approved by 
FDA and proposed by FSIS, is highly effective in reducing the level of 
most pathogens associated with meat and poultry. As an example, if the 
minimum absorbed dose for fresh (not frozen) meat was 2.0 kGy 
throughout all parts of the meat or poultry, the decimal log reduction 
(each log reduction is equivalent to a 90 percent reduction in the 
total population) would be as follows: Campylobacter jejuni = 10 log10 
per gram of product; Escherichia coli O157:H7 and Trichinella spiralis 
= 6.7 log10 per gram of product; Listeria monocytogenes and Toxoplasma 
gondii = 5 log10 per gram of product; and Salmonella spp.--4 log10 per 
gram of product. All of the reductions in the previous example would 
represent the potential for significant reductions in the number of 
foodborne outbreaks associated with meat and poultry. Irradiation, at 
the absorbed dose level approved by FDA and proposed by FSIS, would not 
be effective in reducing the level of viruses.
    FDA answer. Pathogens are not all equally sensitive to irradiation 
and the amount of radiation needed to kill a significant fraction can 
depend on whether the food contains free liquids such as water. For 
example, pathogens such of the vibrio species are very sensitive while 
spore forming bacteria such as Clostridum botulinum can be very 
resistant. Other pathogens, such as Salmonella, Campylobacter, 
Listeria, or certain pathogenic strains of E. coli, have intermediate 
resistances. Larger doses are needed when the food is dry or frozen. 
Irradiation is very effective at killing all of these pathogens other 
than Clostridum botulinum under the conditions of approval for meats 
and poultry. As a general rule, viruses in food are not very sensitive 
to radiation and are controlled better by heat processing.
    FDA answer. Irradiation of a food, as with other processing 
methods, can have an effect on texture, taste, or quality. The 
magnitude of the effect can be controlled, to some degree, by 
controlling the conditions of irradiation. For example, an effect will 
become larger as the radiation dose is increased. Irradiation of a 
solid versus dry or deep-frozen product has less of an effect than one 
that contains liquids. Oxygen in the atmosphere can promote rancidity 
in a fatty food. Effects in meats with strong flavors may be less 
detectable than in more bland products. Optimizing irradiation 
conditions would require balancing costs and the degree of bacterial 
control against unintended effects to obtain a product that consumers 
would want.
    We would expect food processors to control the conditions of 
irradiation so that any irradiated meat sold would be acceptable to the 
average consumer. This does not necessarily mean that there would be no 
effect on texture, taste, or flavor. However, we would not expect food 
manufacturers to market a product unless consumers found it to be of 
good quality and taste.
    Question. I understand that irradiation will not alter the texture, 
taste, or quality of meat if used properly. Is this true?
    Answer. Irradiation, at the absorbed dose level approved by FDA and 
proposed by FSIS, will not noticeably alter the texture, taste, odor, 
appearance, or keeping quality of fresh or frozen meat or poultry.
    Question. Will the use of irradiation affect the cost of food 
products to the consumer?
    Answer. FSIS estimated in the proposed rule on red meat irradiation 
that the low end cost of irradiating ground beef would be 2.0 cents per 
pound and the high end cost would be 6.0 cents per pound, depending 
upon the volume of product irradiated (64 FR 9100).
    Question. I understand that irradiation will not affect the 
nutritional value of meat products any more than cooking does. Is this 
true?
    USDA answer. Irradiation, at the absorbed dose level approved by 
FDA and proposed by FSIS, will not reduce the level of sensitive 
nutrients (e.g., thiamin) below the level expected to be reduced by 
cooking. This point has been made in all educational materials produced 
by FSIS on irradiation. It is also discussed in FSIS' proposed 
regulation, which says in part:
    ``Central to the FSIS food safety strategy are efforts to reduce 
the level of microbiological pathogens in raw meat and poultry 
products. Irradiation has been shown to be a highly effective method 
for reducing the levels of microbiological pathogens in raw meat food 
products. Further, FDA has concluded that irradiation of meat food 
products, under the conditions requested by Isomedix, Inc. and granted 
by FDA, would not present toxicological or microbiological hazards and 
would not adversely affect the nutritional adequacy of these products. 
FSIS, therefore, sees compelling reasons to propose regulations 
providing for the irradiation of meat food products and has rejected 
the option of disallowing irradiation.'' (Federal Register, Vol. 64, 
No. 36, p. 9097)
    FDA nswer. Both irradiation and cooking can decrease the levels of 
some nutrients and irradiation followed by cooking can have a greater 
effect, just as heat processing canned or cooked hams followed by 
cooking will increase nutrient loss. The important thing is that people 
get their nutrients from a variety of sources in sufficient amounts to 
allow for some losses. FDA has concluded that consuming irradiated meat 
will not have a significant effect on the nutritional status of 
consumers.
    Question. Will the use of irradiation affect the cost of food 
products to the consumer?
    FDA answer. Because the use of irradiation has been relatively 
minor, limited information is available on how the marketplace will 
address the issue.
    Question. There has been a controversy over the labeling of 
irradiated products. Could you give us a status report on where we are 
on the labeling of irradiated food products?
    USDA answer. For packages of irradiated product (i.e., all the meat 
or poultry contained in the package is irradiated), FSIS has proposed 
the same labeling requirements as those specified by FDA. Regarding 
secondary products (i.e., products in which irradiated meat or poultry 
comprise one or more ingredients in the formulation), FSIS has proposed 
that the ingredient statement should list the irradiated ingredient in 
the order of its level of predominance in the formulation. Presently, 
FDA does not have a similar requirement for the secondary product 
labeling of irradiated ingredients. FDA did issue an advance notice of 
proposed rulemaking on February 17, 1999 (64 FR 7834) concerning 
possible revisions to the labeling requirements for irradiated foods. 
Meanwhile, FSIS and FDA expect to meet and discuss the secondary 
product labeling issue. Both FSIS and FDA recognize the benefits of a 
consistent labeling policy for irradiated food.
    FDA answer. When FDA issued its rule on irradiated foods in 1986, 
it concluded that there was no safety reason for requiring special 
labeling but that consumers should be informed when a food has been 
irradiated. Because a food that has been irradiated will not appear to 
have been processed, FDA required that the label indicate processing, 
except where an irradiated ingredient was added to a food which 
obviously had been processed. FDA required placement of a symbol, the 
radura, along with the words ``Treated by irradiation'' or ``Treated 
with radiation'' to educate people on what the radura symbolized. FDA 
encouraged manufacturers to add truthful phrases to the statement so 
consumers would understand why the food was irradiated.
    In 1997, FDAMA mandated that the disclosure statement could not be 
required to be more prominent than the ingredient statement. On August 
17, 1998, FDA amended its requirement for the labeling of irradiated 
food to clarify the interpretation of prominence consistent with FDAMA.
    On February 17, 1999, FDA issued a notice requesting comment on the 
labeling of irradiated food. FDA cited the directive to solicit comment 
on this issue from the FDAMA Conferees Report, provided background 
information on labeling requirements, and posed a series of directed 
questions intended to address how consumers interpret the label and 
what information should be provided. At this time, FDA is receiving 
comments. The comment period is open until May 18, 1999.
                     codex alimentarius activities
    Question. What is the current (fiscal year 1999) budget for our 
Codex activities? What is the fiscal year 2000 request? Is this funding 
sufficient to protect our trade policy needs, and how is it 
administered in the budget?
    USDA answer. USDA considers the Codex Alimentarius function to be 
very important for maintaining a science-based approach to standard 
setting for foods which are in international commerce. Recently the 
positioning of the U.S. Codex Office within USDA and FSIS has been 
elevated to the Office of the Administrator, and he and the Under 
Secretary are working with the U.S. Codex Manager to insure the staff 
works efficiently across USDA and the U.S. Government. An expanded 
Codex Steering Committee chaired by the Under Secretary for Food Safety 
includes membership from across the U.S. Government, including State, 
U.S. Trade Representative, Commerce, as well as AMS and FAS within USDA 
and all the food standard setting agencies--FSIS, FDA and EPA.
    FSIS plans to spend about $782,000 in fiscal year 1999 on Codex 
Alimentarius activities. This amount is expected to increase in fiscal 
year 2000 by the amount needed to cover mandatory pay raises. 
Additional Codex costs are decentralized throughout USDA and other 
government agencies to support Codex delegate participation and provide 
for meetings, and for policy setting discussions.
    FDA answer. FDA does not have a defined budget for Codex 
activities. The U.S. Codex Office, which has oversight over U.S. Codex 
activities, resides in USDA within the Office of the Administrator of 
the Food Safety and Inspection Service. Most of the activities of 
Codex, however, are decentralized throughout several government 
agencies, including FDA, USDA agencies, EPA, National Marine Fisheries 
Service in the Department of Commerce, and trade agencies. FDA has, 
since the beginnings of the Codex Alimentarius Commission in 1962, 
devoted considerable resources to ensuring that Codex international 
food standards reflect the level of safety and quality expected by the 
U.S. consumer. Currently FDA provides the U.S. Delegate or the 
Alternate Delegate to 14 of 16 Codex Committees and has established a 
Codex Management Group within FDA to better assist the U.S. Codex 
Office in coordinating the broad array of FDA-related Codex activities.
    Codex activities are part of the Animal Drugs and Feed's Program's 
overall International travel budget. There is no separate line item in 
the budget for Codex activities. In fiscal year 1999 the Animal Drugs 
and Feeds Program spent approximately $3,000 on Codex activities. For 
fiscal year 2000 the anticipated expense is $5,000. The international 
travel budget is spread throughout the Program's budget.
    Question. Dr. Woteki, you are aware that the Food Industry Codex 
Coalition strongly believes that adequate and dedicated line-item 
funding to support the activities of the U.S. Codex Office in the 
amount of $3.15 million is required for fiscal year 2000 to expand 
export opportunities for U.S. products and advance international food 
policy based on sound science. In fact, as Chair of the U.S. Codex 
Steering Committee, I understand that you have indicated to the 
Coalition that the Committee agrees with this need and is committed to 
working on securing this funding in the fiscal year 2001 budget cycle.
    USDA answer. The Steering Committee is in agreement that the level 
of resource commitment described in the Coalition's proposal is 
desirable. However, it has not concluded that a line item for the U.S. 
Codex Office is the appropriate mechanism for assuring an appropriate 
level of activity in support of U.S. positions in Codex.
    Question. Why do you not share the Coalition's concern that U.S. 
trade and food safety interests require these additional resources now 
and this additional funding should not be postponed until fiscal year 
2001?
    USDA answer. As you may know, the Administration was approached 
with the Coalition's proposal very late in the fiscal year 2000 budget 
development cycle. While the Codex Policy Steering Committee is in 
agreement that the proposed funding level is desirable, the Codex 
Policy Steering Committee decided to delay consideration of a line item 
for the U.S. Codex Office until fiscal year 2001. This would permit the 
Departments and Agencies to assess what their current spending is on 
Codex activities, how that might be offset by this new line item, and 
what would actually constitute an increased effort, if any.
    Question. What is the relationship between the Codex Alimentarius 
and the agreements of the World Trade Organization, specifically to the 
science base of the Sanitary and Phytosanitary Standards?
    USDA answer. The rules that govern international trade are those 
that were agreed during the Uruguay Round of Trade Negotiations and 
apply to the members of the World Trade Organization (WTO). With 
respect to food safety matters, those rules are set out in the 
Agreement on the Application of Sanitary and Phytosanitary Measures--
The SPS Agreement. The overall objective of the SPS Agreement is to 
permit countries to take legitimate measures to protect the life and 
health of their consumers, but keeping them from using those measures 
in a way that unjustifiably restricts trade. The primary goal of the 
SPS Agreement is to limit the use of any measures that may restrict 
trade to those that are justified to provide the necessary level of 
health protection. It recognizes the right of Member States to protect 
their consumers at a level they consider necessary, subject to certain 
principles, such as consistency and transparency. Codex decisions are 
given new standing under SPS, as they are regarded as setting food 
safety standards as a baseline under SPS.
    The standards, guidelines, and other recommendations of the Codex 
Alimentarius Commission are considered by the WTO to reflect 
international consensus regarding the requirements for protecting human 
health from foodborne risks. A Member State's food safety measures are 
considered justified and in accordance with the provisions of the SPS 
Agreement if they are based on Codex standards and related texts. While 
the adoption and application of Codex standards are not mandatory, 
failure to apply the Codex standards creates the potential for dispute 
if a Member State applies standards that are more restrictive of trade 
than necessary to achieve required levels of protection. Additionally, 
by the terms of the SPS Agreement, WTO members are committed to 
considering Codex standards as a basis for their national laws and 
regulations, and to participate in the development of those 
international standards.
    FDA answer. The WTO Agreement on the Application of Sanitary and 
Phytosanitary Measures, the SPS Agreement, makes specific reference to 
the Codex Alimentarius Commission as an international standard setting 
organization whose standards WTO Members should use as a basis for 
national SPS measures. The SPS Agreement also obligates Members to 
participate actively in Codex, within the limits of their resources. 
With regard to the science basis for standards, the SPS Agreement 
requires that Members base their national measures both on scientific 
evidence and on international standards, specifying that Members can 
maintain more stringent SPS measures, if there is scientific 
justification, under the terms of the Agreement. Under the Agreement, 
national SPS measures that conform with Codex standards are presumed to 
be in accord with the SPS Agreement.
    Question. Is the current budget sufficient to permit US trade 
agency representation at critical Codex meetings (Departments of State 
and Commerce and the United States Trade Representative) in order to 
proactively influence decisions key to US trade interests?
    USDA answer. Currently, trade agency representation at Codex 
meetings is encouraged. In fiscal year 1998, the U.S. sent delegations 
to 13 foreign hosted meetings of Codex subsidiary committees. There was 
a total of 14 trade agency representatives on the United States' 
delegations to 10 of those meetings. Trade agencies' representatives 
were not members of delegations to the Cocoa and Cocoa Products, 
Mineral Water, and Nutrition and Foods for Special Dietary Use 
Committees.
    FDA answer. FDA cannot respond on behalf of the U.S. trade 
agencies, but the Agency can address its roles, responsibilities, and 
related resource commitments with respect to Codex. While FDA does not 
have a specific line item in its appropriation, a significant amount of 
the Agency's resources is devoted to Codex activities. FDA expends 
funds to support a portion of the time of 39 individuals directly 
involved in 14 of the 16 Codex Committees. As the quantity of food 
products flowing in and out of this country is increasing at an ever 
rapid pace, the Agency must use a greater percentage of base resources 
each year to provide technical support for these U.S. trade agencies, 
and also represent U.S. interests at critical Codex meetings. FDA is 
involved in these activities in order to ensure the safety of imported 
products and accomplish our mission as stated in the Food and Drug 
Administration Modernization Act of 1997 Plan for Statutory Compliance, 
to ``. . . participate through appropriate processes with 
representatives of other countries to reduce the burden of regulation, 
harmonize regulatory requirements, and achieve appropriate reciprocal 
arrangements.''
    Question. Would increased funding for Codex enhance our trade 
policy and US exports? What additional activities could be undertaken 
with increased funding?
    USDA answer. Putting additional funds into a line item for Codex 
may not result in any additional activity. Agencies and departments 
already make decisions to fund activities that support our positions in 
Codex from their program funds. Spending from a line item account would 
likely offset that spending. While it would create an ease of 
administration with respect to some activities, such as paying for U.S. 
hosted meetings of Codex Committees, it would limit the flexibility 
agencies and departments now have to address changing priorities.
    FDA answer. Yes, increased funding for Codex activities would 
enhance our trade policy and U.S. exports. With the World Trade 
Organization or WTO and the Sanitary and Phytosanitary System or SPS 
Agreement, the U.S. trade agencies will be more dependent on the 
agencies responsible for setting standards for both human and animal 
food. Increased funding would greatly enhance the U.S. efforts to 
ensure both public health and fair trade. In the future, it will be 
much more difficult to determine whether new standards are protective 
of public health or are just disguised trade barriers.
    As one example, Codex, with the assistance of the Joint Expert 
Committee on Food Additives or JECFA, developed and adopted maximum 
residue levels for several hormones used to enhance growth in beef. 
Since Codex serves as the reference international organization for food 
safety standards under the World Trade Organization SPS Agreement, 
these Codex standards were accepted by a WTO panel in the dispute 
between the EU and the U.S. over the use of hormones in beef 
production. This case involved more than $200 million in beef exports 
to the EU and was subsequently won by the U.S. FDA personnel 
participated in both the Codex and JECFA deliberations. This example 
illustrates the value of Codex in enhancing our trade policy and U.S. 
food exports.
    Presently, the Codex mandate is to protect the health of consumers 
while ensuring fair trade practices. FDA continues to focus on 
protecting public health, but as the demand for FDA's involvement in 
ensuring fair trade practices grows, comparable resources are needed. 
If FDA receives additional funds, the Agency can expand upon those 
existing activities that simultaneously ensure the safety of human and 
animal food, and enhance our exports and U.S. trade policy. FDA is 
involved in three major areas related to Codex and or U.S. trade. These 
are ensuring that Codex standards meet a high standard of public health 
and safety consistent with our level of protection, technical 
assistance to U.S. trade agencies and bilateral negotiations in matters 
of equivalency or assessment. FDA needs resources, both budget and FTE, 
that will support coordinated efforts with U.S. trade agencies to 
determine the impact of Codex activities on trade long before disputes 
are taken to the WTO. FDA is involved in these activities in order to 
ensure the safety of imported products and accomplish a key component 
our mission as stated in the Food and Drug Administration Modernization 
Act of 1997 Plan for Statutory Compliance.
    Question. We are currently making a substantial investment in food 
safety research. For fiscal year 1999, the Administration indicates 
that a total of $108 million will be invested in food safety initiative 
research, including $70 million by the Agricultural Research Service, 
$28 million by the Food and Drug Administration, and $15 million by the 
Cooperative State Research, Education and Extension Service. How is the 
food safety research funded by different agencies and through these 
various programs being coordinated to address research priorities and 
needs, to prevent duplication of effort?
    USDA answer. These three agencies have had a collective history of 
consulting about research priorities, the specific needs that should be 
reflected in Requests for Proposals for extramural programs, and the 
research focus for internal programs. This interaction has been 
accelerated by the work of the Interagency Working Group, chaired by 
USDA Deputy Undersecretary Eileen Kennedy and DHHS Science Advisor 
William Raub. This group has been involved in compiling an extensive 
inventory of existing research in food safety using data from fiscal 
years 1997 and 1998. From this base, the agency scientists have 
analyzed the current portfolio and compared it to the expressed 
research needs stated by regulatory agencies, industry spokespersons, 
consumer representatives and other interested parties in a series of 
stakeholder listening sessions. This analysis has provided greater 
assurance that our research portfolios do reflect the stated needs of 
our stakeholders. These kinds of inputs have also created an impetus 
for shifting research funds from a focus almost entirely on meat, 
poultry, eggs, and dairy, to the inclusion of a larger segment of 
research on fresh fruits and vegetables as it was evident that this was 
an emerging problem area. By virtue of these analyses, we have been 
able to confirm that duplication of research efforts was not a serious 
issue.
    FDA answer. The food safety agencies have worked to coordinate 
activities in every area of the initiative since the implementation of 
the Food Safety Initiative in May, 1997. In fiscal year 1998 and fiscal 
year 1999, FDA worked directly with USDA in establishing areas of 
responsibility for Food Safety Initiative research. In fiscal year 
1999, FDA sent a letter to the USDA research agencies concerning the 
expenditure of $5 million by USDA in consultation with FDA and listing 
FDA's regulatory research needs that would potentially be more 
optimally performed by USDA. Most of the FDA research needs focus 
primarily on pre-harvest research areas that the intramural and 
extramural programs of the USDA research agencies have unique expertise 
and facilities, or for which FDA knows that there is USDA research 
already underway.
    President Clinton signed an Executive Order in fiscal year 1998 
that established the Joint Institute for Food Safety Research and 
formalized the interagency research planning process. Likewise, 
Executive Order 13100 was signed on August 24, 1998, establishing the 
Food Safety Council and formalizing an interagency food safety budget 
planning and overall strategic planning. The President's Council on 
Food Safety has the responsibility for the development a comprehensive 
strategic plan for federal food safety activities to the Council. The 
Council will develop a comprehensive plan to improve the safety of the 
nation's food supply by establishing a seamless, science-based food 
safety system. The plan will address the steps necessary to achieve 
this improved system, focusing on key public health, resource, and 
management issues and including measurable outcome goals.
    The Animal Drugs and Feeds Program initiated a detailed planning 
session designed to focus on food safety issues related to our 
regulatory mission, specifically, the impact of animal feed and 
antibiotics used in food producing animals on human health through the 
transmission of food-borne pathogens and/or the development and 
dissemination of antibiotic resistance. As an integral part of the 
planning efforts, scientists from FDA and other federal agencies such 
as USDA/ARS, and USDA/FSIS were actively involved with the development 
of our research plans, in large measure to avoid duplication of effort. 
In addition, the Animal Drugs and Feeds Program scientists participated 
in the planning activities of these same agencies. This process has 
continued to keep the other agencies apprised of our ongoing activities 
as well as their activities, explore areas for collaborative research 
efforts, and be able to respond to changing research needs and 
priorities.
    Question. How are research results being shared and utilized by the 
various agencies involved in food safety? (USDA's REE)
    USDA answer. Research results are being shared and utilized among 
the various agencies involved in food safety research. The staff 
members of the REE agencies are in frequent contact with one another 
regarding research agendas in their respective program areas. They 
participate with each other in workshop and committee meetings, and 
they serve together on many governmental and professional committees 
and in joint budget initiatives. The Under Secretary of REE has worked 
with members of the various agency staffs to prepare an Inventory of 
Food Safety Research which will serve as the basis for interagency 
program planning. The ARS has established formal liaison with both the 
FSIS and the FDA who have the responsibility to coordinate the research 
needs of these agencies with the available ARS research capabilities. 
Yearly workshops are held to review results and plan and coordinate 
research to meet new needs of these regulatory agencies. In addition 
there is oversight of all food safety activities by the newly formed 
Food Safety Council. Reporting to the Council will be the new Joint 
Institute for Food Safety Research which will be a coordinating body 
among the food safety research agencies in both USDA and DHHS.
    CSREES has a strong interaction with all other agencies involved in 
the food safety agenda of the Federal government as well as strong 
linkages with the land-grant and other universities. Examples of the 
latter are the fact that we regularly receive input on adequacy of 
Requests for Proposals from merit review panels following their review 
and critique of a set of submitted proposals. These faculty come from 
the potential recipient universities and usually have close contact 
with many other stake holders. To ensure formal involvement, most of 
the invited speakers at the First Annual Food Safety Conference held on 
November 12-13, 1998, and sponsored by CSREES and ARS, were from the 
research community in the land-grant system. This conference was 
focused on establishing research needs and included substantive 
dialogue between industry, consumer, and other stakeholders on the one 
hand, and interested research scientists on the other.
    The substance of the Requests for Proposals for both the National 
Research Initiative and the Special Research Grants program was 
discussed with all other Federal agencies, including FDA, prior to the 
final version being submitted for administrative review and 
publication. CSREES has taken up the responsibility of providing a 
major portion of the educational effort needed to ensure a smooth 
transition to the FDA Guidance Document, ``Minimizing Microbial 
Contamination of Fresh Fruits and Vegetables''.
    CSREES provided funding for the domestic conference which was 
focused on development of the educational program and framework for the 
domestic grower of fresh fruits and vegetables. CSREES scientists have 
participated with scientists from other Federal agencies in the 
Interagency Working Group which has just completed an analysis of the 
current (1998) food safety research portfolio. This analysis will 
provide a beginning point for the new Joint Institute for Food Safety 
Research as it begins to coordinate and oversee the Federal research 
effort on food safety.
    Other interagency efforts currently in place include a mycotoxin 
committee linking FDA and USDA scientists in an effort to establish 
some mutual goals and objectives. CSREES scientists are also 
participating in a USDA task force on antibiotic resistance and CSREES 
program scientists are having discussions with FDA-Center for 
Veterinary Medicine on specific responses to the increasing concern 
about antibiotic resistance and the research needs which this issue has 
surfaced.
    FDA answer. The results of food safety research efforts are shared 
among Federal food safety agencies, industry, and the public through 
multiple means. Within the scientific community, communication among 
researchers has always been the cornerstone upon which scientific 
advances have been built. Scientists have developed numerous formal and 
informal venues for the exchange of knowledge such as scientific 
publications, meeting of professional societies and internet bulletin 
boards. In addition, food safety researchers and the agencies to which 
they belong make a concerted effort to research segments of the 
country's population that can benefit from the scientific advances. For 
example, during the past year the FDA hosted two technical workshops 
for the manufacturers of orange juice to allow scientists to share the 
latest advances in methods for preventing unpasteurized orange juice 
from being contaminated with foodborne pathogenic bacteria. Similar 
workshops have been held with the sprouted seed industry and are 
planned for apple cider industry. There is also a concerted effort on 
the part of the food safety research community to inform the public of 
scientific advances. For example, FDA scientists working on research in 
support of the National Food Safety Initiative have been posting plain 
language reports of their research projects on the FDA's Center for 
Food Safety and Applied Nutrition internet web site. One of the goals 
of the newly established Joint Institute for Food Safety Research is to 
further enhance the communicate of food safety research advances to all 
interested parties.
    The Animal Drugs and Feeds Program initiated a detailed planning 
session designed to focus on food safety issues related to our 
regulatory mission, specifically, the impact of animal feed and 
antibiotics used in food producing animals on human health through the 
transmission of foodborne pathogens and/or the development and 
dissemination of antibiotic resistance. As an integral part of the 
planning efforts, scientists from FDA and other federal agencies such 
as USDA/ARS, and USDA/FSIS were actively involved with the development 
of our research plans, in large measure to avoid duplication of effort. 
In addition, the Animal Drugs and Feeds Program scientists participated 
in the planning activities of these same agencies. This process has 
continued to keep the other agencies apprised of our ongoing activities 
as well as their activities, explore areas for collaborative research 
efforts, and be able to responsive to changing research needs and 
priorities.
    CDC surveillance information is communicated to FDA and USDA on a 
regular basis. Also, through laboratory networks such as PulseNet, 
diagnostic information is shared very quickly electronically. For 
example, laboratories participating in PulseNet have a direct link with 
a central computer and electronic database of DNA ``fingerprints'' 
maintained at CDC. Laboratories are able to submit patterns to the 
national database online and obtain epidemiologic information 
associated with patterns in the database, If patterns submitted by 
laboratories in different locations during a defined time period are 
found to match, the CDC computer alerts PulseNet participants of a 
possible multistage outbreak so that a timely investigation can be 
done. If a bacterial strain is isolated from a suspected food, the 
strains from humans and suspected food can be compared quickly. Thus, 
matching patterns can indicate possible nationwide outbreaks and lead 
to public health actions such as epidemiologic investigations, product 
recalls, and ultimately to regulatory and other changes to prevent 
widespread outbreaks.
    Such efforts have stimulated additional interagency collaboration 
to develop new, and evaluate existing, systems for sharing important 
information.
    Question. Please distinguish the role of the various agencies in 
food safety research.
    USDA answer. The Agricultural Research Service (ARS), as the 
intramural research agency of the U. S. Department of Agriculture, is 
considered to be the first response agency for the primary USDA 
regulatory agency, the Food Safety and Inspection Service. The ARS 
provides much of the expertise for development of detection systems 
required for regulatory oversight plus information about intervention 
methods, especially in meat and poultry. This agency is also well 
suited to undertake long term investigations that require a long period 
of sustained funding to accomplish the stated goal, a process not well 
suited to smaller, investigator initiated projects from the public 
sector.
    The Cooperative State Research, Education, and Extension Service 
provides funding to extramural research organizations, universities, 
and institutes in both public and private settings. It benefits from 
investigator initiated proposals which bring forward new concepts and 
ideas for control of food safety hazards. Because these extramural 
programs can draw on a vast array of expertise in the university 
system, proposals may cover a very wide spectrum. In the National 
Research Initiative, the focus is on basic or fundamental research 
which can then provide information of use in more applied research 
efforts within our Food Safety Special Grants program or as a basis for 
extension educational programs.
    The Economic Research Service (ERS) determines estimates of the 
costs of food borne illnesses and evaluates economic consequences for 
consumers of policies and programs which reduce food borne disease 
incidence and their associated medical costs and productivity losses. 
With respect to risk assessments, ERS evaluates the costs and benefits 
of alternative pathogen control strategies.
    To summarize, it does appear that each agency has a specific 
mission or role to fulfill and the research programs of the various 
agencies are complementary and not duplicative. In addition, ARS 
scientists are often located in close proximity to the Department's 
partners in the academic community, providing further opportunity for 
collaboration and communication between researchers.
    FDA answer. Considering the highly complex nature of food safety 
concerns and the wide array of factors that can impact the safety of 
the U.S. food supply, it is not surprising that there are a number of 
agencies that contribute to the Federal food safety research effort. 
The primary agencies within the Department of Health and Human Services 
that directly conduct food safety research are the FDA and the CDC. In 
addition, the NIH supports fundamental research that provides 
scientific advances that contribute to the general advancement of 
public health research. Within the USDA the primary research agencies 
are the ARS which is the intramural research agency for USDA, and the 
Cooperative State Research Education, and Extension Service or CSREES 
which is the extramural research agency. In addition to these agencies 
these are a number of other agencies, such as DOD, EPA, and NMFS, that 
have smaller, focused food safety research programs.
    The specific areas and aspects of food safety research undertaken 
by the individual agencies largely reflect the mission of the agency. 
For example, the FDA CFSAN research program is in direct support of the 
Agency's need to have scientifically based inspection systems and food 
safety policies. Thus, the research program has focused on the 
development of effective detection methods, the evaluation of post-
harvest intervention and prevention technologies, and the advancement 
of risk assessment techniques. Conversely, a substantial portion of the 
ARS food safety research has focused on the development of pre-harvest 
methods for preventing the introduction of human pathogens at the 
agricultural production level. Such a diverse research portfolio has 
the potential for unplanned redundancy of efforts. To avoid this, there 
has always been a high degree of coordination among food safety 
research agencies and their scientists. This is being enhanced further 
by the establishment of the Joint Institute for Food Safety Research 
which will provide a formal mechanism for coordination of food safety 
research planning.
    CDC plays a critical and unique role as a monitoring, 
investigative, and advisory agency, and works closely with Federal food 
safety regulatory agencies. CDC is the cornerstone Federal agency for 
identifying and monitoring foodborne and other human illness; for 
detecting, investigating, and responding to outbreaks of foodborne 
illness; and for documenting the effectiveness of prevention and 
control efforts.
    In addition to surveillance and response, CDC conducts applied 
research. Examples include developing laboratory diagnostic techniques; 
developing methods to subtype, or ``fingerprint'' pathogens causing 
foodborne illness; conducting risk factor studies for foodborne illness 
in special populations, such as the immunocompromised; and performing 
cost-effectiveness studies of potential prevention measures.
    FDA's role in food safety research is based on the need to maintain 
safety and efficacy of food animal drugs, food additives, packaging 
materials, and diagnostic kits. The research is used to define science-
based policies and regulatory frameworks. The FDA Animal Drugs and 
Feeds Program has focused on those FSI activities, as specified in the 
document ``Food Safety from Farm to Table,'' which relate to the Animal 
Drugs and Feeds regulatory mandate. The research developed from FSI 
research areas will aid the Animal Drugs and Feeds Program and Agency 
in formulating policy and regulations related to antibiotic use in 
food-producing animals and the potential impact on human health.
    Question. What research is currently being carried out by each 
agency for fiscal year 1999? What is planned for fiscal year 2000? 
Please provide a description of each research project, the level of 
funds for the project, and indicate who is carrying out the research.
    USDA answer. Food Safety activities are carried out by CSREES, 
NASS, ERS, and ARS. The Cooperative State Research, Education, and 
Extension Service (CSREES) has not yet made any awards under its 
competitive grants program in the National Research Initiative or in 
the Food Safety Special Research Grants program for fiscal year 1999. 
The Requests for Proposals have been issued and the focus of these 
Requests are as follows. In the regular National Research Initiative 
Food Safety program ($4.5 million), proposals have been requested that 
focus on control and prevention strategies, sources of microbial 
contamination, improved sampling and detection systems for bacteria, an 
understanding of the mechanisms of antibiotic resistance, risk 
assessment and hazard evaluation, studies on consumer behavior and 
adoption of safe food habits by consumers, and mechanisms of microbial 
pathogenesis in humans. The National Research Initiative Supplemental 
grant program ($5 million) will focus on epidemiologic investigations 
of food borne pathogens within all segments of the farm to table 
continuum and in all types of food products, including meat, poultry, 
dairy, and fresh fruits and vegetables. The goal of this supplemental 
program is to have a major focus on the production segment of the food 
chain and provide information needed to develop best management 
practices or conduct meaningful risk assessment studies on specific 
pathogens.
    The Special Grants Program in Food Safety ($5 million) will 
continue to have some focus on fresh fruits and vegetables with more of 
an emphasis on applied studies on the production segment of the 
industry. Other specific issues include development of risk assessment 
models for specific segments of the food chain with a special emphasis 
on ready-to-eat foods, and establishing the scientific basis and models 
for establishing and validating critical control points in the food 
chain. This Request for Proposals is expected to be released on about 
April 1, 1999.
    For the fiscal year 2000, CSREES has requested $10.1 million 
increase in food safety research to strengthen efforts in risk 
assessment research, and in the epidemiology of food borne pathogens 
and development of improved control and prevention methods including 
implementation of Good Production Practices by producers and growers.
    The National Agricultural Statistics Service (NASS) has requested 
for fiscal year 2000 $2.5 million to conduct a survey of fruit and 
vegetable growers, as well as packing houses, to establish a baseline 
for good agricultural practices as they relate to microbial food safety 
issues. The survey would consist of core questions covering water and 
manure management, facility sanitation, worker sanitation and hygiene, 
and transportation practices. In fiscal year 1999, NASS will conduct a 
pilot study in California and New York to provide information for the 
final design of materials and plans for the requested nationwide 
baseline survey effort in fiscal year 2000. These two pilot States were 
chosen based on distinct differences in crops grown, growing 
conditions, and agricultural practices.
    Total Economic Research Service (ERS) funding for food safety 
research in fiscal year 1999 is $938,000. ERS is continuing research on 
the costs associated with illnesses associated with microbial pathogens 
in food. Starting with the estimated number of illnesses, and examining 
the nature and severity of the illness, ERS analysts have calculated 
the medical costs, based on the typical treatment for each type of 
illness. This year we have completed a project to re-estimate the 
medical costs of disease caused by one specific pathogen, Salmonella. 
We conducted a joint research project with staff of the Centers for 
Disease Control and Prevention, using data from the FoodNet 
Surveillance System, to re-evaluate the number of cases of 
Salmonellosis, and to re-estimate the medical costs and productivity 
losses using new data sources. Preliminary findings are that the total 
costs of illnesses associated with Salmonella in food are lower than 
previously thought. Final results will be released when the FoodNet 
estimates on the number of Salmonellosis cases are cleared by CDC. ERS 
has also completed a study evaluating the alternative economic methods 
for placing premature death from foodborne illness in an economic 
perspective. These methods allow us to estimate the costs to society 
from premature death. ERS is planning a major conference for fiscal 
year 2000 to provide guidance to decision makers on the best 
methodologies for placing an economic value on premature death.
    For fiscal year 2000, ERS has requested $1,391,000, which includes 
an increase to support economic analysis in risk assessment. In fiscal 
year 1999, ERS has worked with the Risk Assessment Consortium 
(established under the President's Food Safety Initiative), to begin 
ranking foodborne health risks on the basis of their economic cost to 
society. We intend that these funds will be awarded under a competitive 
grants process, where one or more research programs will be funded over 
three years to apply state-of-the-art economic analysis to estimate the 
benefits of making the U.S. food supply safer, and to expand our risk 
assessment activities to include analysis of the economic burden placed 
on society by additional sources of foodborne health risk.
    In fiscal year 1999, Agricultural Research Service (ARS) is 
providing $69,867,600 for food safety research specifically in the 
areas of detection and prevention/control of food borne hazards; 
antimicrobial/antibiotic resistance; risk assessment; and food 
handling, distribution and storage. In fiscal year 2000, ARS is 
requesting an increase of $11.7 million to support additional food 
safety research, for a total of $81,589,600.
    In fiscal year 1999, ARS undertook 40 projects ($14.2 million) in 
detection of food borne pathogens; 70 projects ($37.9 million) in 
prevention and control of pathogens; 7 projects ($2.2 million) in 
antimicrobial/antibiotic resistance; 9 projects ($4.9 million) in risk 
assessment; and 18 projects ($10.6 million) in food handling, 
distribution and storage.
    In fiscal year 2000, ARS plans to undertake additional research in 
the following areas: detection of food borne pathogens ($700,000); 
prevention and control of pathogens ($4,750,000); antimicrobial/
antibiotic resistance ($3,420,000); risk assessment ($2,400,000); and 
food handling, distribution and storage ($450,000).
    A listing of the fiscal year 1999 ARS projects is provided for the 
record.
    [The information follows:]

                              ARS PROJECTS
                           [Fiscal year 1999]
------------------------------------------------------------------------
        Research title              Funds               Location
------------------------------------------------------------------------
   DETECTION OF FOOD BORNE
          PATHOGENS
 
Food Safety Pathogen                  110,000  Headquarters
 Reduction.
Agricultural vs Natural                42,100  Beltsville, MD
 Habitats as Sources of
 Cryptosporidium Parvum......
Epidemiology and Control of           353,400  Beltsville, MD
 Toxoplasma, Trichinella and
 Related Parasites...........
Prevention and Therapy for            245,700  Beltsville, MD
 Protozoan Parasites.
New Technologies to Improve           344,700  Beltsville, MD
 and Assess Meat Quality and
 Safety......................
Develop Detection Methods for         296,400  Beltsville, MD
 Cryptosporidium.
Methods of Analysis for               310,300  Beltsville, MD
 Residues in Meat and Agric.
 Products.
New Handling Systems and               59,300  Beltsville, MD
 Pathogen Decontamination
 Technology for Fruits.......
New Handling Systems and               59,300  Beltsville, MD
 Pathogen Decontamination
 Technology for Fruits.......
Detection of Pathogenic             1,141,000  Wyndmoor, PA
 Bacteria by Biosensors.
Advanced Technologies for the       1,093,600  Wyndmoor, PA
 Analysis of Contaminants in
 Foods.......................
Rapid Pathogen Diagnostic and         541,900  Wyndmoor, PA/ Purdue
 Detection Methods.                             University
Stress Adaptation and                 328,300  Wyndmoor, PA
 Virulence Expression of
 Pathogens in Food...........
Food Safety Engineering Univ.         988,000  Wyndmoor, PA
 Of Purdue: Biosensor Technol-
   ogy.......................
ARS Microbial Germplasm               378,800  Peoria, IL
 Collection for Agricultural
 and Industrial Uses.........
Supercritical Fluid                   434,100  Peoria, IL
 Techniques for Food Safety
 and Nutrient Analysis.......
Detection, Identification,            826,100  Peoria, IL
 and Surveillance of
 Mycotoxins in Cereals.......
Prevention of Loss from               284,300  Ames, IA
 Colibacillosis/E. coli
 O157:H7 in Cattle and Swine.
Prevention in Livestock of            487,000  Ames, IA
 Potential Human Foodborne
 Pathogens...................
Treatment/Handling of Animal          148,200  Riverside, CA
 Manure to Prevent Pathogen
 Transmission................
Control of Pathogens on               478,100  Albany, CA
 Surfaces of Poultry and of
 Fruits and Vegetables.......
Adhesion of Human Pathogens           538,500  Albany, CA
 to Surfaces of Poultry,
 Fruits and Vegetables.......
Removal of Aflatoxin                  215,000  Albany, CA
 Contamination from Human
 Foods in Real-Time by
 Imaging Techniques..........
Treatment of Animal Manure to         148,200  Albany, CA
 Prevent Pathogen
 Transmission................
Pinus and Gutierrezia                  53,700  Logan, UT
 Species: Toxicoses and
 Abortion in Livestock.......
Astragalus and Oxytropis               63,600  Logan, UT
 Poisoning in Livestock.
Livestock Poisoning by                 43,800  Logan, UT
 Pyrrolizidine Alkaloids and
 Other Hepatotoxic and
 Teratogenic Plants..........
Poisoning of Livestock by              53,700  Logan, UT
 Larkspur (Delphinium)
 Species.
On-Line Verification and              436,500  Clay Center, NE
 Intervention Procedures for
 HACCP in Slaughter/
 Processing Systems..........
Control of Salmonella and E.          783,400  Clay Center, NE
 coli O157:H7 in Livestock/
 Preharvest..................
Prevent the Occurrence of             296,400  Fargo, ND
 Toxins in Water/Protect Food
 and Environment.............
Methodology Development for           797,000  College Station, TX
 Rapid Analysis of Drug and
 Pesticide Residues in Food
 Animal Products.............
Mississippi Center for Food           358,700  Mississippi ST,
 Safety and Postharvest
 Technol-  ogy...............
MS Determine Isoflavonoid             206,200  New Orleans, LA
 Induction in Legumes and
 Their Phytoestrogenic
 Effects in Animal Systems...
Post-Mortem Muscle/Meat               414,100  Athens, GA
 Changes That Affect Product
 Safety and Quality..........
Reduction of Fusarium                 166,500  Athens, GA
 Mycotoxins in Agricultural
 Commodities.................
Rapid Pathogen Diagnostic and         245,500  Athens, GA
 Detection Methods.
Reduction of Biofilms Related         297,600  Athens, GA
 to Bacterial Contamination
 and Pathogen Load During
 Poultry Processing.
Prevent Pathogen Transmission          74,100  Athens, GA
 in Animal Manure.
Treatment of Poultry Manure            74,100  Athens, GA
 to Prevent Pathogen Transmis-
   sion......................
                              -----------------
      TOTAL..................      14,217,200  .........................
                              =================
  PREVENTION AND CONTROL OF
          PATHOGENS
 
Preharvest Control of                 861,200  Headquarters
 Aflatoxin.
Food Safety Pathogen                  105,700  Headquarters
 Reduction.
Assessment of Agricultural vs         168,500  Beltsville, MD
 Natural Habitats as Sources
 of C. Parvum................
Epidemiology and Control of           342,700  Beltsville, MD
 Toxoplasma, Trichinella and
 Related Parasites...........
Strategies to Control Swine           766,600  Beltsville, MD
 Parasites Affecting Food
 Safety.
Prevention and Therapy for            245,600  Beltsville, MD
 Protozoan Parasites.
Animal Waste Handling Systems         592,800  Beltsville, MD
 to Prevent Pathogen
 Transmission................
Fate and Environmental Impact         350,800  Beltsville, MD
 of Agricultural Nutrients in
 Sustainable Production
 Systems.....................
The Effect of Plant Genetics          218,200  Beltsville, MD
 and Zinc on Cadmium
 Concentration and
 Bioavailability in Crops....
Composting, Stabilization,            790,800  Beltsville, MD
 and Safe Use of Manure and
 Mineral By-Products from
 Rural/Urban Areas...........
Integrated Soil-Nutrient-Crop-        240,600  Beltsville, MD
 Microbial-Pest-Waste
 Management Strategies for
 Sustainable Agriculture.....
Development of Techniques for       1,001,800  Beltsville, MD
 Inspection of Poultry Carcas-
   ses.......................
New Handling Systems and              177,800  Beltsville, MD
 Pathogen Decontamination
 Technology for Fruits.......
New Handling Systems and              177,800  Beltsville, MD
 Pathogen Decontamination
 Technology for Fruits.......
Quality Maintenance and Food          545,200  Beltsville, MD
 Safety of Fresh and Fresh
 Fruits/Vegetables...........
Agricultural Approaches to            166,500  Ithaca, NY
 Human Health Through
 Understanding Soil-Plant-
 Human/Animal Food Systems...
Improving the Nutritional             149,700  Ithaca, NY
 Quality and Stress Tolerance
 of Food Crop Species........
Interventions to Improve the          776,000  Wyndmoor, PA
 Microbiological Safety and
 Quality of Fruits and
 Vegetables..................
Pathogen Contamination in             296,400  West Lafayette, IN
 Food Producing Swine.
Molecular Approach to                 852,800  Peoria, IL
 Understand/Control Fusarium
 Infection and Mycotoxin
 Contamination of Crops......
Strategies for Developing             222,700  Peoria, IL
 Maize Kernels Resistant to
 Invasion by Fusarium........
Control of Fusarium                   984,000  Peoria, IL
 Mycotoxins and Diseases in
 Corn and Small Grains.......
Integrated Control of               1,201,100  Peoria, IL
 Aspergillus Flavus and
 Aflatoxin in the Midwest
 Corn Belt...................
Control and Prevention of             415,700  Ames, IA
 Cryptosporidium Parvum
 Infection.
Rumen Microbes and Their              475,800  Ames, IA
 Interactions with Secondary
 Plant Metabolites...........
Prevention of Losses from             710,800  Ames, IA
 Colibacillosis and E. coli
 O157:H7 in Cattle/Swine.....
Epidemiology and Control of           657,200  Ames, IA
 Salmonella.
Prevent Zoonotic Pathogen             592,800  Ames, IA
 Transmission in Swine.
Prevent Pathogen                      296,400  Ames, IA
 Contamination in Food
 Producing Animals, Swine....
Treatment/Handling of Animal          444,600  Riverside, CA
 Manure to Prevent Pathogen
 Transmission................
Practical Application of              327,700  Albany, CA
 Molecular Genetics for
 Improved Potato Cultivars...
Reduction of Aflatoxin in             946,900  Albany, CA
 Tree Nuts and Figs Through
 Control of Major Insect
 Vectors.....................
Control and Prevention of             750,100  Albany, CA
 Aflatoxin Formation in Tree
 Nuts.
Control of Pathogens on               697,200  Albany, CA
 Surfaces of Poultry and of
 Fruits/Vegetables...........
Adhesion of Human Pathogens           517,000  Albany, CA
 to Surfaces of Poultry
 Fruits/Vegetables...........
Treatment of Animal Manure to         444,600  Albany, CA
 Prevent Pathogen Transmis-
 sion........................
Pinus and Gutierrezia                 483,100  Logan, UT
 Species: Toxicoses and
 Abortion in Livestock.......
Astragalus and Oxytropis              572,100  Logan, UT
 Poisoning in Livestock.
Livestock Poisoning by                394,200  Logan, UT
 Pyrrolizidine Alkaloids and
 Other Hepatotoxic and
 Teratogenic Plants..........
Poisoning of Livestock by             483,100  Logan, UT
 Larkspur (Delphinium)
 Species.
Control of Salmonella and E.        1,081,900  Clay Center, NE
 coli O157:H7 in Livestock
 During Preharvest...........
Determine the Correlation             296,400  Clay Center, NE
 Between Production and
 Transportation Practices in
 Cattle......................
Cytokine-Mediated Modulation          539,500  College Station, TX
 of the Innate Immune
 Response to Prevent
 Salmonellosis in Poultry....
Development of Microbial CEC        1,249,900  College Station, TX
 Methods to Reduce Pathogens
 in Swine....................
Prevention and Control of           1,189,400  College Station, TX
 Salmonella and Other
 Enteropathogens in Poultry
 During Growout..............
Prevent Pathogen                      281,600  Lubbock, TX
 Contamination in Food
 Producing Animals, Cattle...
Disease Related Problems of           293,800  Fayetteville, AR
 Poultry Production and
 Processing..................
Enhancing Biotic Pest                 669,100  Mississippi ST, MS
 Resistance in Corn Germplasm.
Aflatoxin Control Through           1,019,900  New Orleans, LA
 Targeting Gene Cluster
 Governing Aflatoxin
 Synthesis in Corn and
 Cottonseed..................
Modification of Fungal                488,600  New Orleans,
 Community Structure to
 Improve Food Safety.........
LA Aflatoxin Control Through        1,324,200  New Orleans, LA
 Addition of Enhancement of
 Antifungal Genes in Corn and
 Cotton......................
Development of Improved               267,700  Tifton, GA
 Peanut Germplasm with
 Resistance to Disease and
 Nematode Pests..............
Genetic Improvement of Corn           151,700  Tifton, GA
 and Sorghum for Resistance
 to Insects and Aflatoxin....
Plant Resistance and                  145,000  Tifton, GA
 Germplasm Enhancement for
 Managing Insect Pests of
 Southern Crops..............
Biochemical, Physical,                745,600  Dawson, GA
 Microbiological Management
 for Prevention of Mycotoxin
 in Peanuts..................
Pathogenesis, Detection, and        1,025,400  Athens, GA
 Control of S. Enteritidis
 and Other Salmonellae in
 Chickens....................
Stimulation of Mucosal                371,200  Athens, GA
 Immunity in Chickens to
 Protect Against Enteric and
 Respiratory Pathogens.......
Engineering Innovations and           537,500  Athens, GA
 Micro Developments to Reduce
 Contamination of Poultry and
 Equipment...................
Control of Campylobacter            1,117,400  Athens, GA
 Jejuni in Poultry.
Control of Salmonella During          844,400  Athens, GA
 Poultry Production.
Reduction of Fusarium                 666,000  Athens, GA
 Mycotoxins as Concerns in
 Agricultural Commodities....
Control and Prevention of           1,032,300  Athens, GA
 Mycotoxin Formation by the
 Corn Endophyte Fusarium
 Moniliforme.................
Epidemiology and Ecology of           327,400  Athens, GA
 S. Enteritidis in Commercial
 Poultry Flocks..............
Food Safety-Pathogen                  237,000  Athens, GA
 Reduction in Poultry.
Prevent Pathogen Transmission         222,300  Athens, GA
 in Animal Manure.
Treatment of Poultry Manure           222,300  Athens, GA
 to Prevent Pathogen Transmis-
   sion......................
On-Line Detection Technology:         439,100  Athens, GA/Inst. Of Tech.
 PPQRU RRRC/Institute                           Dev.
 Technology Development......
Food Safety, Waste                    491,800  Raleigh, NC
 Minimization, and Value
 Enhancement of Fermented and
 Lightly Processed Vegetables
National Agricultural                 219,600  Beltsville, MD
 Library: Food Safety Data
 Base........................
                              -----------------
      TOTAL..................      37,942,600  .........................
                              =================
   ANTIMICROBIAL/ANTIBIOTIC
          RESISTANCE
 
Assurance of Microbiological          159,900  Wyndmoor, PA
 Safety of Thermally
 Processed Foods.............
Stress Adaptation and                 506,100  Wyndmoor, PA
 Virulence Expression of
 Bacterial Pathogens in Food
 Environments................
Improve Safety and Shelf-Life         156,700  Wyndmoor, PA
 of Meat and Poultry with
 Ionizing Radiation..........
Epidemiology and Control of           295,300  Ames, IA
 Salmonella.
Development of Microbial CEC          588,200  College Station, TX
 Methods to Reduce Pathogens
 in Swine....................
Pathogen Reduction in Poultry         218,800  Athens, GA
Antibiotic Resistance                 296,400  Athens, GA
 Research.
                              -----------------
      Total..................       2,221,400  .........................
                              =================
       RISK ASSESSMENT
 
Epemiology and Control of             374,800  Beltsville, MD
 Toxoplasma, Trichinella in
 Domestic Animals............
New Technologies to Improve           344,700  Beltsville, MD
 and Assess Meat Quality and
 Safety......................
Minimally Degradative                 302,900  Wyndmoor, PA
 Pasteurization Processes for
 Liquid or Solid Foods.......
Assurance of Microbiological          399,900  Wyndmoor, PA
 Safety of Thermally
 Processed Foods.............
Risk Modeling to Improve the          120,700  Wyndmoor, PA
 Microbiological Safety of
 Poultry Products............
Microbial Modeling Components       1,209,600  Wyndmoor, PA
 for Use in Risk Assessments.
Improve Safety and Shelf-Life         156,700  Wyndmoor, PA
 of Meat and Poultry by
 Irradia-  tion..............
Disposition of Beta-Agonists          915,300  Fargo, ND
 in Farm Animals.
Dioxins and Other                   1,084,400  Fargo, ND
 Environmental Contaminants
 in Foods.
                              -----------------
      Total..................       4,909,000  .........................
                              =================
 FOOD HANDLING, DISTRIBUTION
         AND STORAGE
 
Develop New Handling Systems           59,300  Beltsville, MD
 and Pathogen Decontamination
 Technology for Fruits.......
Develop New Handling Systems           59,300  Beltsville, MD
 and Pathogen Decontamination
 Technology for Fruits.......
Interventions to Improve the          987,600  Wyndmoor, PA
 Microbiological Safety and
 Quality of Fruits and
 Vegetables..................
Development of Minimally              959,200  Wyndmoor, PA
 Degradative Pasteurization
 Processes for Liquid or
 Solid Foods.................
Detection of Pathogenic               303,300  Wyndmoor, PA
 Bacteria by Biosensors.
Assurance of Microbiological          239,900  Wyndmoor, PA
 Safety of Thermally
 Processed Foods.............
Risk Modeling to Improve the          120,700  Wyndmoor, PA
 Microbiological Safety of
 Poultry Products............
Stress Adaptation and                 533,400  Wyndmoor, PA
 Virulence Expression of
 Pathogens in Food...........
Improve Safety and Shelf-Life       1,253,800  Wyndmoor, PA
 of Meat/Poultry with
 Ionizing Radiation..........
Quantitative Determination of         966,700  Wyndmoor, PA
 Pathogen Reduction During
 Animal Slaughter and Food
 Processing..................
Control of Pathogens on               816,700  Albany, CA
 Surfaces of Poultry and
 Fruits and Vegetables.......
Adhesion of Human Pathogens         1,098,600  Albany, CA
 to Surfaces of Poultry and
 Fruits/Vegetables...........
Adv. Technologies for                 541,300  Albany, CA
 Reduction of Microorganisms
 and Particulate Matter in
 Food Processing.............
Removal of Aflatoxin                  215,000  Albany, CA
 Contamination from Human
 Foods in Real Time by
 Imaging Techniques..........
Control of Pathogenic and             844,400  Clay Center, NE
 Spoilage Bacteria on Red
 Meat.
Develop On-Line Verification          436,500  Clay Center, NE
 and Intervention Procedures
 for HACCP in Slaughter/
 Processing Systems..........
Engineering Innovations and           537,500  Athens, GA
 Micro Developments to Reduce
 Contamination of Poultry and
 Equipment...................
Reduction of Biofilms Related         604,200  Athens, GA
 to Bacterial Contamination
 and Pathogen Load During
 Poultry Processing.
                              -----------------
      Total..................      10,577,400  .........................
                              -----------------
      Total Food Safety......      69,867,600  .........................
------------------------------------------------------------------------

    FDA answer. The applied research CDC conducts is directed toward 
developing and enhancing surveillance of foodborne illness, and is 
supported under the surveillance line of the Food Safety Initiative 
budget. For example, CDC's FSI resources are directed toward increasing 
CDC's capacity to identify new foodborne hazards and characterize the 
risk posed by those hazards, increasing the speed with which the 
presence of hazards in foods can be determined and controlled, and 
increasing the accuracy and timeliness of public health data that 
justify food safety control programs and evaluate their effectiveness.
    FDA would be happy to provide this information for the record.
    [The information follows:]
                      food and drug administration
                          food safety research
    The 1999 Food Safety Initiative builds on science-based gains in 
research during 1998. The initiative places increased emphasis on 
ensuring the safety of domestic and imported fresh produce and imported 
foods, and develops scientific information and tools to control a 
greater range of food safety hazards. The 2000 President's Food Safety 
Initiative builds on the foundation established in 1998 and 1999 for 
research and risk assessment activities. The following information 
provides greater detail on research projects for fiscal year 1999 and 
2000:
Planned Activities Funded by Fiscal Year 1999 Funds
    FDA's FSI base resources and $25 million appropriation in fiscal 
year 1999 will support the following activities and accomplishments in 
the area of research and risk assessment:
  --research toward pathogen growth and control in areas critical to 
        reduce microbial risk in produce;
  --improved detection methods (rapid tests) to identify a broader 
        range of pathogens on food products (fresh fruits and 
        vegetables), throughout food production, manufacturing and 
        distribution systems;
  --develop prevention/intervention strategies, with research on the 
        development of alternative food production, processing, and 
        handling systems that eliminate or pathogen contamination; and 
        risk assessments of Listeria, Vibrio Parahaemolyticus, and 
        methyl mercury.
Planned Activities Funded by Proposed Fiscal Year 2000 Funds
    FDA's fiscal year 1999 FSI base resources and the proposed $3 
million increase requested in fiscal year 2000 for research are 
expected to support the following activities:
  --extramural contracts to further expand methods development and 
        prevention technology research. These contracts will be 
        supported with other Federal agencies; upgrade scientific 
        equipment;
  --expand data collection on contaminated foods associated with 
        foodborne outbreaks and characteristics of people who did not 
        become ill after exposure to the same foods;
  --expand development of appropriate animal models for determining 
        whether threshold or non-threshold models for infectivity are 
        more appropriate for describing low dose infectivity rates for 
        infectious and toxicoinfectious microorganisms;
  --expand development of modeling techniques for assessing human 
        exposure to a variety of foodborne contaminants especially 
        emerging pathogens.
    The following table provides a list of research projects planned by 
FDA in fiscal year 2000
                                                       Estimated Project
        Research Projects/Project Title                         Cost \1\
Sampling for Pathogens on Produce.............................$1,500,000
Molecular Characterization of Maverick Strains of 
    Enterohemorrhagic E. coli.................................   400,000
Effects of Environmental Conditions, Phytochemicals, Modified 
    Atmosphere Packaging and other Parameters for the Growth 
    and Survival of Foodborne Pathogens on Produce, 
    Particularly Sprouted Seeds............................... 1,200,000
Molecular Mechanisms for Pathogen Emergence................... 1,250,000
Identification and Characterization of Virulence Determinants 
    for Salmonella enteritidis and Vibrio vulnificus..........   400,000
Cyclospora Detection and Viability Assessment.................   450,000
Characterization of Pathogenic Aquatic Eucaryotes and their 
    Toxins.................................................... 1,500,000
Control of Viral and Bacterial Human Pathogens in Seafood.....   650,000
Assessment of Technologies for Pathogen Reduction or 
    Elimination............................................... 1,750,000
Study of Mycotoxins........................................... 1,650,000
Virulence Assessment and Molecular Pathogenesis of Salmonella 
    Typhimurium DT 104 and Shigella...........................   450,000
Minimizing Biogenic Amine Formation in Seafood and Other 
    Commodities...............................................   540,000

\1\ The following estimated costs for each project are based on base 
resources (fiscal years 1997, 1998 and 1999) plus requested increases in 
fiscal year 2000.

                 ANIMAL DRUGS AND FEEDS PROGRAM/RESEARCH
------------------------------------------------------------------------
                                        Organization
         Research Project               Carrying Out        Fiscal Year
                                          Research         1999 Funding
------------------------------------------------------------------------
Detection procedures for pathogens  University of               $400,000
 in meat, eggs, animal feed and      Tennessee Center
 the environment.                    for Veterinary
                                     Medicine.
Pathogen reduction in animal feeds  Washington State             300,000
                                     University Center
                                     for Veterinary
                                     Medicine.
Pathogen reduction research on      University of                800,000
 food producing animals and the      Wisconsin,
 environment.                        University of
                                     Georgia, ARS/USDA,
                                     Center for
                                     Veterinary Medicine.
Determine impact of antibiotic use  Center for                   300,000
 in feed on bacterial resistance     Veterinary Medicine.
 development and pathogen
 transmission in food producing
 animals and the environment.
Evaluate effects of various drug    New England Medical          700,000
 doses and routes of                 Center William
 administration on bacterial         Beaumont Hospital
 antibiotic resistance development   Center for
 and dissemination.                  Veterinary Medicine.
------------------------------------------------------------------------

    FDA food safety research being conducted in fiscal year 1999 with 
NCTE for the Animal Drug and feeds Program ($85,000 from the 
Surveillance FSI program to NCTE) includes assessing microbial products 
intended for food animals that are designed to reduce colonization by 
Salmonella, evaluation of antimicrobial drug resistance in these 
products, development of rapid screening tests for antimicrobial drug 
resistance determinants and food borne pathogens, and identification of 
bovine mitochondrial DNA contaminants in animal feed.

                 ANIMAL DRUGS AND FEEDS PROGRAM/RESEARCH
 
------------------------------------------------------------------------
                                        Organization
         Research Project               Carrying Out        Fiscal Year
                                        Research \1\       1999 Funding
------------------------------------------------------------------------
Detection procedures for pathogens  University of               $800,000
 in meat, eggs, animal feed and      Tennessee Center
 the environment.                    for Veterinary
                                     Medicine.
Pathogen reduction in animal feeds  Washington State             300,000
                                     University Center
                                     for Veterinary
                                     Medicine.
Pathogen reduction research on      Center for                   800,000
 food producing animals and the      Veterinary Medicine.
 environment.
Determine impact of antibiotic use  Center for                   300,000
 in feed on bacterial resistance     Veterinary Medicine.
 development and pathogen
 transmission in food producing
 animals and the environment.
Evaluate effects of various drug    New England Medical        1,000,000
 doses and routes of                 Center, William
 administration on bacterial         Beaumont Hospital,
 antibiotic resistance development   Center for
 and dissemination.                  Veterinary Medicine.
Characterization of bacterial       Center for                   500,000
 multiple antimicrobial resistance   Veterinary Medicine.
 mechanisms in animals and the
 environment.
------------------------------------------------------------------------
\1\ In fiscal year 2000 a request for proposals will be advertised and
  additional cooperative agreements will be funded in addition to the
  ones mentioned.

    Question. The Administration indicates that $20 million will be 
invested in fiscal year 1999 through the Food Safety Initiative on 
education. Would you please describe the various education activities 
planned or being undertaken by each of the five USDA agencies, the Food 
and Drug Administration, and the CDC?
    USDA answer. A food safety video for use in senior citizens' 
centers will be produced and distributed in cooperation with FDA. Other 
activities planned for 1999 and 2000 include work with the Partnership 
for Food Safety Education's ``Fight BAC! '' campaign; observance of 
National Food Safety Education Month; curriculum development, aimed at 
bringing the farm-to-table Initiative into classrooms nationwide; and 
publications distribution. Participating agencies have also formed the 
National Food Safety Information Network to bring together the 
government's primary mechanisms for providing food safety information 
to the public. The National Food Safety Information Network consists of 
the following media: FDA's Food Information Line, USDA's Meat and 
Poultry Hotline, USDA/FDA Foodborne Illness Education Information 
Center at the National Agricultural Library; www.FoodSafety.gov, the 
Gateway to Government Food Safety Information on the World Wide Web; 
FoodSafe, an electronic dissemination system; and EdNet, an electronic 
newsletter for food safety educators.
    In the area of pre-harvest food safety education, FSIS is working 
to establish animal production food safety partnerships with State 
agriculture agencies. FSIS is also working with the Department of 
Education to develop internet-based educational programs for 
agricultural extension agents and vocational agriculture teachers. 
Using data collected from a national producer educational survey--
conducted in 1998-1999 by Tuskegee University, Texas A&M and the 
Research Triangle Institute--FSIS plans to issue grants to ``1890 
Institutions'' to conduct educational outreach targeting small and 
limited producers in the southeastern United States.
    The Cooperative State Research, Education, and Extension Service is 
providing education and outreach to growers and producers of domestic 
and imported fresh fruits and vegetables. This effort supports the 
President's Food Safety Initiative and the Initiative to Ensure the 
Safety of the Imported and Domestic Fresh Fruits and Vegetables. 
Increased funding in fiscal year 1999 has provided needed resources to 
support collaborative efforts with the Food and Drug Administration, 
the Centers for Disease Control and Prevention, and the Foreign 
Agricultural Service to provide education and outreach to both national 
and international growers and producers. An example is the ``Fight 
BAC!'' campaign developed by the Partnership for Food Safety Education 
in conjunction with the President's Food Safety Initiative to simplify 
and provide useful public education and information about safe handling 
of all foods. The Partnership consists of numerous associations, 
councils, and institutes, with liaison from four Federal agencies, 
including USDA, and an international affiliation with Canada. These 
efforts are focused on building a strong, viable, integrated food 
safety program across the federal government.
    In fiscal year 1999, the Cooperative State Research, Education, and 
Extension Service has $7,365,000 for competitive projects in food 
safety education. We anticipate funding 70-80 food safety extension 
education projects which may range from $50,000 to $500,000. Proposals 
have been solicited which focus on training for food handlers, consumer 
food safety education, use of good agricultural practices to increase 
food safety, and development of a national food safety database.
    FDA answer. CDC is happy to provide the information for the record. 
CDC conducts educational activities primarily for health care 
professionals and the public. Examples include materials on how high-
risk populations can avoid foodborne illness and training videos on 
laboratory methods to diagnose foodborne pathogens. In addition, CDC 
actively participates with FDA, USDA, industry, and consumer 
organizations in the Partnership for Food Safety Education, a public-
private partnership created to reduce the incidence of foodborne 
illness by educating Americans about safe food-handling practices 
through many activities, including the national Fight 
BAC Campaign. The purpose of the Fight 
BAC Campaign is to help educate the public about 
foodborne illness and motivate the consumers to take basic sanitation 
and food-handling steps to reduce the risk of foodborne illness. With 
National Food Safety Initiative resources in fiscal year 1999, CDC also 
is working with FDA and USDA to reach school-age children through 
school-based efforts.
    FDA would be happy to provide the information for the record.
    [The information follows:]
           food and drug administration education activities
    FDA will invest a total of $2.47 million in fiscal year 1999 on 
education, and consumer research that will serve as the basis for 
consumer education material. This amount represents a $400,000 increase 
over fiscal year 1998.
Education
    The Agency will use the funding to continue to support and broaden 
partnerships and alliances with other food safety organizations that 
allow the Agency to leverage resources while spreading food safety 
messages to a greater number of people. The focus this year is to 
expand consumer education to change unsafe food handling practices of 
individuals at high risk for foodborne disease and the non-English 
speaking populations.
    Another FDA priority in fiscal year 1999 is the development of 
school-based food safety programs to establish lifelong safe food 
handling practices in young people. To achieve this goal, an agreement 
has been signed with the National Science Teachers Association to 
develop a supplemental food safety curriculum for use in secondary 
schools. This program will also provide food safety training to over 
half of these students who will at some time during their teenage years 
work in a food service establishment.
    A recent FDA-USDA consumer survey showed that only 1 percent of 
consumers viewed eggs as a risky food, a decrease of 10 percent since 
1993. A public education campaign through the media as well as through 
community health associations and food service operations will be 
launched later this year concerning the safe handling of eggs.
    Funding during fiscal year 1999 will support the Food Information 
Center at FDA that provides food safety information to consumers 
through its hot line, fast fax, web page and E-mail dissemination 
system. The Food Information Center is part of jointly supported FDA-
USDA system of information distribution.
Research
    In order to target consumer education materials where it is most 
needed, research in kitchens is currently underway to identify unsafe 
food handling behaviors that consumers are actually practicing (as 
opposed to reported as being practiced).
    FDA will also conduct consumer research on special groups, such as 
Spanish speaking populations, to determine the best way to communicate 
key food safety principles in order to achieve behavioral changes.
    Data available to FDA indicates that retail food service operations 
(including fast food restaurants, vending operations, institutional 
feeding operations such as schools, hospitals, and nursing homes) are 
the source of a substantial number of food-borne illnesses. Market 
research will also be conducted to identify barriers to safe food 
preparation practices by the retail food service industry. This type of 
research activity will produce a knowledge base for educators and will 
guide the design of more effective training programs and materials 
targeted for development next fiscal year. This program will address 
the impact of the high turnover in food service workers and target 
small businesses, and new entrepreneurs.
    Question. I know that the Food Safety and Inspection Service has 
food safety hotline. Is this the only government hotline, or does each 
agency have its own?
    FDA answer. The Food Safety and Inspection Service hotline deals 
with meat and poultry. FDA's Center for Food Safety and Applied 
Nutrition has a toll free Food Information Line, 1-800-332-4010, to 
cover other foods and dietary supplement questions. The FDA and USDA 
information lines will soon be integrated so that calls will routinely 
be handled by the most appropriate agency and the agencies can more 
easily handle hot issues and crises.
    Additionally, other Federal Government toll-free food-related 
information lines include Department of Commerce's National Marine 
Fisheries Service at 1-800-422-2750, Environmental Protection Agency's 
Safe Drinking Water Hotline at 1-800-827-2794, and EPA's National 
Pesticide Telecommunications Network at 1-800-858-7378. The 
administration has established a government food safety web site 
(http://www.foodsafety.gov/) designed to help the public find 
government food safety information more readily on the web. The site 
provides links to food safety-related web sites from federal, state and 
local government agencies, including CDC.
    Question. What audiences are you currently targeting through your 
food safety education efforts?
    USDA answer. FSIS is working to reach those at greatest risk for 
foodborne illness, in addition to the general public. Specific target 
audiences include: Home food handlers; Cooks and food handlers in 
retail settings and congregate feeding sites; School foodservice 
providers; Children; Expectant mothers; Child care providers; The 
elderly and Immune-compromised individuals. In the area of pre-harvest 
food safety education, FSIS is targeting its outreach efforts towards 
the one million food animal producers and the thousands of livestock 
markets and satellite industries.
    In fiscal year 1999, the Food Safety and Quality National Education 
Initiative of the Cooperative State Research, Education, and Extension 
Service has significantly expanded the Department of Agriculture's 
education and outreach efforts to consumers, educators, health 
professionals, farmers, veterinarians, producers, processors, food 
service workers, sanitarians, food inspectors, retailers, distributors, 
transporters, and other food handlers. Growers and producers of 
domestic and imported fresh fruits and vegetables are also targeted.
    The Food and Nutrition Service has provided food safety information 
to school food service professionals and child care providers to assist 
them in preparing and serving meals to children, and to work with 
children to teach them safe food handling.
    FDA answer. The Food Safety Initiative's educational efforts will 
target individuals at high risk, such as children, women, elderly, 
individuals with comprised immune system, for foodborne disease, non-
English speaking populations, and consumers of eggs. Another FDA effort 
in fiscal year 1999 is the development of school-based food safety 
programs targeted at young people, so that these messages may establish 
lifelong safe food handling practices.
    Current target audiences are school children, general public and 
public health professionals, including physicians, nurses, 
nutritionists, food protection specialists, laboratorians and 
epidemiologists. CDC is working with FDA and USDA to reach children 
through school-based efforts.
    Question. Dr. Henney, you indicate that through a combination of 
FDA inspection and state contracts, all domestic seafood processors and 
importers were inspected to verify implementation of HACCP by the end 
of calendar year 1998. Were these seafood processors and importers in 
compliance with HACCP implementation requirements?
    FDA answer. Processors were inspected to determine whether they 
have HACCP systems in place, while importers were inspected to 
determine whether they were taking steps to verify that their foreign 
suppliers were processing in accordance with United States, such as 
HACCP requirements.
    Initially, approximately 30 percent of processors and 20 percent of 
importers were in compliance, that is, they had HACCP systems that were 
essentially complete and needed little or no additional work. FDA 
defined compliance in terms of the presence or absence of significant 
technical HACCP problems, not whether a processor was producing food 
that was dangerous to eat, or in imminent danger of doing so. Minor 
technical HACCP problems were not regarded as out of compliance.
    FDA has learned from HACCP pilots and the experience of other 
nations in implementing their own HACCP systems, that the early stages 
of HACCP implementation involves considerable trial and error, both for 
the industry and the regulator. Consequently, FDA's primary objective 
during the first round of inspections was to provide consistent, 
accurate feedback to firms on the status of their HACCP systems. The 
percentage of firms that achieved essentially error free HACCP programs 
by their first inspections was a secondary consideration. No regulatory 
action was contemplated for technical HACCP problems in the absence of 
an imminent public health problem.
    Question. Dr. Henney, you indicate that FDA found a range of 
problems with HACCP implementation that needed to be addressed by 
seafood facilities. What problems did you identify and how are working 
with the seafood industry to address these problems?
    FDA answer. The results of the first round of inspections reflect a 
range of issues, most of which were anticipated. Collectively, the most 
prevalent deficiencies involved lack of adequate sanitation monitoring 
and failure to have a HACCP plan. While many firms practice good 
sanitation, this is an area that has been a longstanding problem with 
the seafood industry generally. With regard to HACCP plans, some firms 
were simply being recalcitrant, while others held a good faith belief 
that, in their case, a plan was not needed. Plans are needed only when 
there are food safety hazards that are reasonably likely to occur with 
the product.
    Where processors had HACCP plans, the problems were, in many cases, 
those that could reasonably be attributed to trial and error. Although 
not minor, those kinds of problems are often readily correctable. In 
other cases, a processor might disagree with FDA over the adequacy of 
its HACCP plan. In most cases FDA would categorize the processor as 
noncompliant, but would also provide the processor with the opportunity 
to demonstrate the adequacy of its HACCP system. Where adequacy can be 
demonstrated, the compliance status of the firm will be changed.
    We are doing a number of things in the second year to continue to 
move the industry down the road toward full compliance. First, we are 
working with a consortium of Federal agencies, the Association of Food 
and Drug Officials, academia, and industry trade associations, 
collectively known as the Seafood HACCP Alliance, to develop a low cost 
training course for processors to help them overcome specific types of 
implementation problems. During part of the course, trained instructors 
will walk students through problem solving exercises that are tailored 
to their specific needs. The Alliance has already developed a basic 
training course in seafood HACCP that has been taken by over 10,000 
individuals. FDA is now contributing $30,000 from FSI funds toward the 
development of this follow-on effort, and we expect it to be ready by 
mid-April. Second, in addition to the course, our district offices are 
planning implementation workshops tailored to their local industries. 
Our Los Angeles district office recently conducted a highly successful 
workshop, and we wish to replicate that effort around the country.
    Third, we are upgrading our guidance materials, including our 
principal guidance document to industry, the Fish and Fishery Products 
Hazards and Controls Guide. This document essentially describes 
everything we know about seafood hazards and controls. It is a one-of-
a-kind document that has earned some international recognition. It has 
been translated into other languages and some countries have 
incorporated it, at least informally, into their own regulatory 
programs.
    To help achieve international compliance with HACCP from those who 
export fish and fishery products to the United States, we are beginning 
a program of foreign inspections, primarily targeted toward developing 
countries with large volumes of seafood exports to the U.S.
    We are also continuing to pursue equivalence agreements with more 
advanced seafood trading partners. Over 30 countries have requested 
that we determine whether their regulatory systems for seafood safety 
are equivalent to ours.
    We are also upgrading the education we provide to our own 
inspectors. We will give them the same follow-on training course that 
is being prepared for industry. In addition, we are developing a 
certification program for seafood inspectors, consisting of courses, 
exams, and on-the-job audits. This program will help ensure uniform, 
national proficiency and will reward inspectors who increase their 
knowledge and inspectional skills.
    Question. What is FDA doing in fiscal year 1999 to ensure full 
compliance with its seafood HACCP rules and regulations?
    FDA answer. It is worth noting that FDA's compliance target for 
fiscal year 1999 is 50 percent, with full compliance not being 
anticipated for several years. A longstanding, key strategy for this 
program has been gradual and steady progress. In the Agency's view, a 
gradual approach provides the best long term chance for success, and is 
affordable given that there is no public health emergency with seafood 
that requires urgent action.
    Seafood includes over 300 edible species from a variety of 
habitats. Most are still wild caught. While no potential hazard causes 
a large number of illnesses in the U.S., there are a wide variety of 
hazards, including some unique to seafood, that can cause illness. 
Seafood safety is a matter of some complexity.
    Thus, it is essential that seafood processors know the potential 
hazards that could affect their products and take science-based 
preventive measures to ensure that these hazards are controlled. Before 
seafood HACCP, there was no requirement that seafood processors 
understand hazards and controls as a condition of selling food to the 
U.S. public. The FDA seafood HACCP program establishes such a condition 
for the first time. In this respect, the education of the industry in 
science-based hazards and controls is a key to success. Ultimately, 
each processor should be able to evaluate its own circumstances and 
develop and tailor a HACCP system to those circumstances.
    Question. I understand FDA funding for Seafood HACCP was $8 million 
for each fiscal years 1998 and 1999. Is that correct? Last year, FDA 
indicated that a $3.4 million increase was requested for Seafood HACCP. 
Why is funding for Seafood HACCP being continued at the fiscal year 
1998 level of $8 million for fiscal year 1999? What level of funding is 
requested for Seafood HACCP for fiscal year 2000? Please compare that 
level to the funding and staffing levels for Seafood HACCP in each of 
fiscal years 1998 and 1999?
    FDA answer. Yes, FDA's funding for the field implementation of 
Seafood HACCP is $8 million for both fiscal years 1998 and 1999. The 
Agency plans to expend an estimated $3.4 million for activities that 
compliment and support Seafood HACCP in fiscal year 1999, but will not 
be directly expended on Seafood HACCP inspections by FDA's field 
office.
    We are happy to provide for the record a table which outlines FDA's 
use of resources for Seafood HACCP.
    [The information follows:]

                          FDA'S SEAFOOD HACCP RESOURCES--FISCAL YEARS 1998 THROUGH 2000
----------------------------------------------------------------------------------------------------------------
                                 Fiscal year 1998      Fiscal year 1999      Fiscal year 1999      Fiscal year
                              ----------------------       Increase                Total         2000 Requestion
           Activity                                 --------------------------------------------     Increase
                               Dollars      FTE                                                 ----------------
                                                     Dollars      FTE      Dollars      FTE      Dollars    FTE
----------------------------------------------------------------------------------------------------------------
HACCP Training,                .......  ...........      2.1           20      2.1           20       .5     1.0
 Implementation & Expansion..
Seafood HACCP Training.......      1.3          1.3  .......  ...........      1.3          1.3  .......  ......
Seafood HACCP Field Inspec-        8.0          8.0  .......  ...........      8.0          8.0  .......  ......
 tions.......................
----------------------------------------------------------------------------------------------------------------

    Question. The President's budget for fiscal year 2000 proposes that 
the Seafood Inspection Program be transferred from the Department of 
Commerce to the Food and Drug Administration. How will the transfer of 
this program to FDA improve the safety of seafood?
    FDA answer. Transfer of the Seafood Inspection Program from the 
Department of Commerce to FDA will improve the safety of seafood in 
several ways. Establishing a Performance Based Organization or PBO at 
FDA will establish FDA as the sole seafood agency with one federal 
HACCP standard, thereby promoting efficiency, effectiveness, and 
consistency of seafood regulation. This centralization will help both 
domestically and internationally. In addition, the PBO will provide 
additional trained inspectors to implement its HACCP regulations, 
resulting in increased frequency of inspection. Consumers will benefit 
by improved food safety from an increased federal regulatory presence 
and a single HACCP standard established by FDA.
    Question. Why are you requesting that this transfer be made through 
the appropriations bill rather than submitting a legislative proposal 
to the appropriate authorizing committees of jurisdiction?
    FDA answer. While the Administration has requested appropriations 
to transfer the program as is, without establishing it as a Performance 
Based Organization or PBO, the longer term solution is authorizing 
legislation that would establish the Seafood Inspection Program as a 
PBO with the Department of Health and Human Services. FDA and the 
Department of Health and Human Services is currently working with the 
Department of Commerce and other parts of the Administration to 
finalize a draft proposal that would accomplish such a PBO. We are 
eager to work with Congress to achieve this goal.
    Question. The budget indicates that a legislative proposal will be 
transmitted to make the Seafood Inspection Program a Performance-Based 
Organization. Would you please explain that proposal.
    FDA answer. FDA and the Department of Health and Human Services are 
currently working with the Department of Commerce and other parts of 
the Administration to finalize a draft proposal that would transfer the 
Seafood Inspection Program of the National Marine Fisheries Service in 
the Department of Commerce to FDA in the form of a Performance Based 
Organization or PBO. A PBO is a quasi-public organization that is 
located in a federal agency but operated like a business in that it is 
to be financially self-sustaining. Although the federal agency oversees 
the PBO, the PBO is given a great deal of autonomy to run day-to-day 
operations, particularly in the areas of personnel and procurement, in 
order to response to customer's needs and marketing conditions.
    In this case, the seafood inspection PBO would continue to perform 
the voluntary, fee-for-service inspection, grading, certification, and 
training services for the seafood industry and other customers 
currently performed by the Seafood Inspection Program in the Department 
of Commerce. In addition, FDA would be able to utilize these trained 
inspectors to perform regulatory HACCP inspections under one Federal 
HACCP standard.
    Question. Dr. Henney you indicate that FDA has undertaken not only 
to strengthen border surveillance activities but to design new programs 
to prevent contamination in countries that export to the United States, 
including an assessment of foreign control over exports to the United 
States and providing technical assistance to foreign countries. Would 
you please be more specific as to the new programs implemented by FDA 
to increase the safety of imported food?
    FDA answer. The FDA is employing a number of strategies to better 
utilize existing import resources and target efforts. One strategy is 
to increase activity in developing Mutual Recognition Agreements or 
MRAs, as well as informal agreements with other countries. These 
agreements recognize regulatory expertise in the exporting country and 
allow foreign governments to provide a degree of assistance in 
controlling export of food products to the United States.
    A second strategy is to conduct audits of Foreign Food Systems to 
assess the prospect of developing future equivalency agreements. As a 
part of these audits, country's infrastructure, laws, regulations, 
inspectional force, and regulatory follow up are evaluated. Assessments 
were completed for Honduras, Trinidad and Tobago in fiscal year 1998. 
We have tentative plans to conduct assessments for Costa Rica and 
Nicaragua in March 1999, and we have tentatively scheduled reviews of 
the infrastructure, laws and regulations related to food safety for 
both Canada and Mexico in fiscal year 1999.
    As a third strategy, FDA is conducting several types of inspections 
in Country of Origin. Primary countries in which Seafood Inspections in 
Country of Origin are being conducted include Ecuador, Taiwan, 
Phillippines, Viet Nam, and Indonesia. Low Acid Canned Food Inspections 
in Country of Origin are being conducted in the following primary 
countries; Ecuador, Brazil, Canada, Malaysia, Philippines, Indonesia, 
and India. The Agency is also conducting compliance inspections for 
land foods in Country of Origin in Canada, Mexico, Italy, Portugal and 
France. Primary commodities inspected include cheese, ready-to-eat, 
heat and serve snack foods, and candy including chocolate candy.
    Yet another strategy involves supporting proposed authority to more 
effectively prevent entry of products that come from countries whose 
food regulatory agencies are unable to effectively regulate their own 
industry, as well as prevent export of products that are violative 
under U.S. law. FDA also supports proposed new authority to cause 
mandatory destruction of refused merchandise. Finally, FDA seeks 
greater interactions with other Federal Agencies, including U.S. 
Customs, to screen, collect and analyze samples, and report these 
results to the FDA for appropriate follow-up.
    The Agency is developing an assessment program of the regulatory 
structure and capabilities of foreign food regulatory agencies for 
possible future equivalency determinations, and has developed industry 
guidance Guide to Minimize Microbial Food Safety Hazards for Fresh 
Fruits and Vegetables.
    The Agency has worked with foreign governments and industry of 
countries identified as being the source of large U. S. outbreaks over 
the last several years, trying to identify and eradicate problems. This 
included inspections of suspect processors and growers.
    Question. Please describe FDA's current surveillance of imported 
food products at our borders. How is this surveillance capability being 
enhanced in fiscal year 1999? What funding and staffing is being 
devoted to this effort, as compared to fiscal year 1998? What level of 
funding is requested for fiscal year 2000?
    FDA answer. FDA has allocated additional resources to increase its 
inspectional staff, with a significant number of new employees being 
devoted to the Agency's import activities. These import activities 
include increased examinations of imported seafood, fresh produce, and 
other public health hazards related to foods. The main emphasis of the 
1999 increase in import surveillance is in our sampling programs, which 
include risk-based assignments and directives from FDA's Center for 
Food Safety and Applied Nutrition or CFSAN. These programs, 
assignments, and directives are being implemented through the 
enhancements to the FDA Operational and Administrative System for 
Import Support, or OASIS, which will allow more selective screening of 
products offered for entry. Through the OASIS system, FDA's districts 
will be able to target consignees, importers, ports and other data 
fields for coverage where as before, the system was unable to 
distinguish many of the data elements for selectivity screening. This 
will also enable FDA to test for specialized information such as 
seafood HACCP compliance status of importing firms.
    One such program assignment is the Agency's Imported Produce 
Sampling Assignment for the examination of various fresh fruits and 
vegetables for microbiological contamination, such as E. coli O157H7, 
Shigella, Cyclospora, etc. This broad-based surveillance and 
enforcement approach is the Agency's response to potential 
microbiological hazards that may be associated with the U.S. fresh 
produce supplies.
    Under the FDA Imported Seafood Program, importer HACCP inspections 
are being conducted to determine compliance with the requirements of 
Title 21 CFR 123.12, which requires seafood importers to assure their 
foreign seafood suppliers are operating in compliance with Seafood 
HACCP regulations.
    FDA also developed and provided specialized import training for 
field employees to assure more uniform and consistent approaches 
throughout FDA's field offices. This training covers many of the basic 
import requirements, including the Federal Food, Drug and Cosmetic Act 
and FDA regulations, Center programs, proper sampling and examination 
techniques, documentation of violations of the laws enforced by FDA, 
and so forth.
    In fiscal year 1999 FDA worked to make sure that all feed and feed 
ingredients were identified as components to be examined at import 
entry into the U.S. to ensure compliance with the regulation 
prohibiting the use of certain mammalian protein from use in ruminant 
feed. This regulation is to prevent the development and amplification 
of Bovine Spongiform Encephalopathy or BSE in the U.S. In addition, in 
fiscal year 1999 the Animal Drugs and Feeds Program will train the FDA 
import personnel to educate importers on the applicability of the BSE 
regulation to certain imported products.
    Question. How has FDA placed special emphasis on ensuring the 
safety of imported and domestic fruits and vegetables?
    FDA answer. FDA developed, in consultation with USDA and industry, 
guidance on good agriculture practices. In October 1998, FDA produced 
the ``Guide to Minimize Microbial Food Safety Hazards for Fresh Fruits 
and Vegetables'' and referred to as GAP's. This guide is intended to 
provide guidance in addressing microbial food safety hazards and good 
agricultural and management practices common to the growing, 
harvesting, washing, sorting, packing and transporting of most fruits 
and vegetable sold to consumers in an unprocessed or minimally raw 
form.
    In fiscal year 1997 and 1998, FDA conducted multiple surveys of 
domestically produced fresh fruits and vegetables including sprouts, 
fresh unpasteurized apple juice and cider, and prepared cut vegetable 
salads. On February 23, 1999, FDA initiated a sample collection and 
analysis assignment for 1,000 samples of imported fresh produce. The 
Agency will test for pathogens and collect data on the extent of 
microbial contamination in fresh produce.
    The Agency has developed and published industry and Investigational 
guidance ``Guide to Minimize Microbial Food Safety Hazards for Fresh 
Fruits and Vegetables'' and ``Guide to Traceback of Fresh Fruits and 
Vegetables Implicated in Epidemiological Investigations'', 
respectively. The Traceback Guide assists the field investigator in 
identifying specific shipments of fruits and vegetables that could be 
involved in epidemiological outbreaks. Training has been provided to 
FDA's field offices. In April 1999, FDA and USDA are sponsoring a 
national training conference for domestic and imported producers on the 
implementation of the ``Guide to Minimize Microbial Food Safety Hazards 
for Fresh Fruits and Vegetables.''
    Question. How many foreign inspections of food establishments were 
conducted in fiscal year 1998? In which countries?
    USDA answer. FSIS oversees imports of meat and poultry products 
from 37 countries to the United States. For the record, the following 
table presents the number of foreign meat and poultry slaughter/
processing establishments audited by country in fiscal year 1998.
    [The information follows]

  Number of Foreign Establishments Audited by FSIS in Fiscal Year 1998

        COUNTRY                                                   AUDITS
Australia.........................................................    18
Austria...........................................................     9
Belgium...........................................................    18
Brazil............................................................    16
Costa Rica........................................................     5
Czech Republic....................................................     2
Denmark...........................................................    26
Finland...........................................................     7
France............................................................    13
Germany...........................................................    12
Great Britain.....................................................     6
Guatemala.........................................................     1
Honduras..........................................................     5
Hong Kong.........................................................     1
Hungary...........................................................     9
Iceland...........................................................     2
Ireland...........................................................     9
Israel............................................................    15
Italy.............................................................    25
Japan.............................................................     3
Mexico............................................................    22
Netherlands.......................................................    19
Nicaragua.........................................................     3
Northern Ireland..................................................     1
Poland............................................................    37
Romania...........................................................     7
Spain.............................................................    12
Sweden............................................................    16
Switzerland.......................................................    12
Uruguay...........................................................    17
                                                                  ______
    Total Countries Visited:......................................    30

    Question. Were the foreign inspections being targeted only on those 
food establishments that produce food products at high risk for 
microbial contamination? Which foods are these?
    USDA answer. FSIS did not target audits at establishments that 
produce meat and poultry products at high risk for microbial 
contamination. Audits are based on random selections of establishments 
that are certified by the foreign inspection systems to export to the 
U.S. When products are found to have microbial violations at U.S. ports 
of entry, the establishments of origin are targeted to be included in 
the list of establishments to be visited during the audits.
    Question. What increases in foreign inspections of food 
establishments are planned for fiscal year 1999 and requested for 
fiscal year 2000?
    USDA answer. FSIS's goal is to visit each country annually to 
conduct on-site audits of selected plants. As part of the audit of a 
country's food safety system, a random selection of establishments 
within each country is selected for review by FSIS personnel.
    Question. Please indicate funding and staffing levels for foreign 
inspections for each of fiscal years 1998 and 1999, and requested for 
fiscal year 2000.
    USDA answer. The FSIS budget for foreign inspections, including 
personnel, travel and operating costs, is approximately $800,000 and 8 
staff years in fiscal year 1998. Both the funding and staffing are 
expected to remain at that level in fiscal year 1999 and fiscal year 
2000.
    Question. How many foreign inspections of food establishments were 
conducted in fiscal year 1998? In which countries? Were the foreign 
inspections being targeted only on those food establishments that 
produce food products at high risk for microbial contamination? Which 
foods are these? What increases in foreign inspections of food 
establishments are planned for fiscal year 1999 and requested for 
fiscal year 2000? Please indicate funding and staffing levels for 
foreign inspections for each of fiscal years 1998 and 1999, and 
requested for fiscal year 2000?
    FDA answer. Twenty six foreign inspections of food establishments 
were conducted in fiscal year 1998. We inspected firms in China, Italy 
and Thailand. The inspections covered low acid canned foods. In 
addition, we also conducted assessments of Guatemala's raspberry 
growing industry. We anticipate completing 100 inspections in fiscal 
year 1999.
    Only foreign food establishments producing products at high risk 
for microbial contamination are targeted for inspection, such as 
seafood, fresh fruits and vegetables, and Low Acid Canned Foods.
    Question. The National Academy of Sciences' report indicates that 
``Although FDA recommended minimum food-handling standards in a Food 
Code issued in 1993, the Code has not been adopted in its entirety by 
most state and local authorities.'' What is being done to encourage 
states to adopt the Food Code?
    USDA answer. USDA is working closely with HHS to promote adoption 
of the Food Code. Last year, Secretaries Glickman and Shalala sent 
letters to all the Governors, to constituents, and to employees of USDA 
and HHS encouraging the adoption and use of the food code. Virtually 
every USDA meeting with or speech directed at state audiences includes 
a reference to the Code and its value as a standard for regulation of 
food safety at retail. Promotion of the adoption of the Food Code was 
one of the themes at the recent, USDA-hosted Federal-State Food Safety 
Conference attended by state Health and Agriculture Commissioners, 
Secretaries Glickman and Shalala, and other officials. USDA personnel 
have also discussed the code with the agriculture committee of the 
National Council of State Legislators (NCSL).
    We are continuing to work with the food industry as well as 
representatives of state and local government, through the Conference 
for Food Protection and in other forums, to encourage industry leaders 
and trade groups to endorse the Food Code and promote its adoption in 
all jurisdictions. Major trade associations like the Food Marketing 
Institute and the National Restaurant Association, government groups 
like the National Association of State Departments of Agriculture, 
professional groups like the Association of Food and Drug Officials and 
the National Environmental Health Association, and many others have had 
input into and have endorsed the Food Code.
    This broad base of support has been instrumental in encouraging 
grass-root support for universal adoption of the Food Code.
    FDA monitors the progress of initiatives in the various 
jurisdictions, and HHS and USDA have tendered a standing offer to 
provide technical advice and expert testimony upon request to support 
State administrative and legislative initiatives to adopt the Food 
Code. FDA's most recent report shows 15 state level agencies and 17 
other jurisdictions (federal agencies, tribal and local government 
agencies) have now adopted the Code, and that another 23 states, Puerto 
Rico, the District of Columbia, and several additional local government 
agencies are in the process of adopting it.
    [The information follows:]
    FDA recently published the 1999 Food Code on February 22, 1999. 
There are at least six distinct efforts under our Public Health Service 
Act mandate to advise and assist states.
    On June 4, 1998, Secretaries Shalala and Glickman wrote to the 
governors encouraging state adoption and implementation of the Food 
Code.
    At the Conference for Food Protection meetings in 1994, 1996 and 
1998, recommendations for modifying the Food Code have been debated, 
passed and sent to FDA. Many of these changes have made newer Food Code 
editions more acceptable to all parties. Strong opposition by the 
regulated industry is now rare.
    We continue to emphasize promotion of the adoption of uniform 
standards by the states in our yearly Compliance Programs. Each fiscal 
year, about 8 person years are allocated to our Field Food Specialists 
to perform this activity.
    When a state requests assistance during its adoption process, we 
have provided technical and administrative help from Headquarters. For 
example, FDA has attended public hearings in both Florida and Minnesota 
to answer questions and support state regulators.
    FDA lists Food Code adoptions on its website to encourage 
participation.
    FDA has drafted a set of proposed standards for food regulatory 
agencies. The first standard in this document is Regulatory 
Foundation--satisfied by adoption of the Food Code as the uniform set 
of rules for regulating retail establishments.
    Question. Would you please tell us more about the importance of the 
Antimicrobial Resistance Monitoring Network to food safety and what 
your plans are to expand the network in fiscal year 1999 and 2000?
    USDA answer. The National Antimicrobial Resistance Monitoring 
System (NARMS) has recently been renamed to NARMS--Enteric Bacteria 
(NARMS-EB) to more accurately reflect its scope. A public health 
surveillance system, NARMS-EB is a systematic, data collection and 
reporting activity. To most efficiently use federal resources, the 
veterinary and human components of NARMS-EB are structured to collect 
comparable data. NARMS-EB provides information on the temporal and 
geographic trends in antibiotic resistant foodborne pathogens. Critical 
analysis and timely reporting of the NARMS-EB data will enable 
researchers, public health practitioners, and clinicians to assess the 
extent of antibiotic resistance in the monitored foodborne pathogens so 
that reasoned action can be taken to prolong the useful life of 
antibiotics, maximize the therapeutic effect of antibiotics in animals 
and man, and minimize human exposure to these potentially harmful 
agents. The NARMS-EB data and isolates facilitate critical research on 
antibiotic resistance and virulence mechanisms.
    As the lead agencies in the NARMS-EB, FDA and CDC have primary 
responsibility for decisions on expanding NARMS-EB. Beginning in fiscal 
year 1999, FSIS began a baseline sampling program for Campylobacter in 
broilers. FDA-CVM requested, and FSIS agreed, to forward those isolates 
to the USDA-ARS research laboratory in Athens, Georgia, that conducts 
the antimicrobial resistance testing for the veterinary portion of the 
NARMS-EB program. Because FSIS generates the majority of the domestic 
Salmonella isolates from meat, poultry, and egg products, FSIS is 
working towards designing its program to ensure that those serotyped 
Salmonella isolates of FSIS origin that are sent to NARMS-EB are most 
representative of the overall domestic meat, poultry, and egg products 
supply.
    FDA answer. The National Antimicrobial Resistance Monitoring System 
or NARMS monitors the emergence and spread of resistance in enteric 
bacteria and helps to ensure the continued safety and effectiveness of 
veterinary antimicrobials. Under NARMS thousands of bacterial isolates 
are tested for resistance to antimicrobials. NARMS will provide an 
early warning to identifying resistance trends among bacteria. All data 
from NARMS are made public for review by scientists or the public. 
NARMS monitors changes in susceptibilities to 17 antimicrobial drugs of 
zoonotic enteric pathogens from human and animal clinical specimens, 
from healthy farm animals, and from carcasses of food-producing animals 
at slaughter.
    NARMS objectives are to prolong the lifespan of approved drugs, 
identify areas for more detailed investigation, guide research in the 
area of antimicrobial resistance, provide timely information to 
practitioners, and provide descriptive data on the extent and temporal 
trends of antimicrobial susceptibility in enteric organisms from human 
and animal populations.
    Benefits gained from NARMS are multiple. NARMS contributed to food 
safety when CDC provided information to public health departments on 
the presence, in specific areas of the country, of Salmonella 
typhimurium DT104, a multi-drug resistant pathogen identified by NARMS. 
Food animal producers use the NARMS report to identify problems 
associated with drug resistance in some food animal populations. 
Researchers use NARMS as a source of well characterized isolates from 
food animals to develop rapid assays to identify human pathogens in 
food. One example is, the Salmonella typhimurium DT104 rapid assay 
announced by Secretary Dan Glickman.
    In fiscal year 1999 and fiscal year 2000 we will expand the 
geographical scope of the NARMS database by supporting the inclusion of 
international resistance information through the World Health 
Organization.
    Future benefits from isolates tested in NARMS are an increased 
ability to detect outbreaks of foodborne disease earlier and recall 
adulterated products preventing exposure of larger proportions of the 
population, improved ability to identify the source of resistant human 
foodborne pathogens, improved characterization of the magnitude and 
type of resistance in food animal populations and improved capability 
to determine the magnitude of resistance transfer in foodborne 
pathogens.
    Question. What are the concerns about the effect of antibiotics on 
resistance of microbes that infect people?
    USDA answer. In general, when humans become infected with a 
bacterial strain that is resistant to one or more antibiotics, 
therapeutic options are diminished, implementation of appropriate 
treatment may be delayed, illness severity may increase, and overall 
treatment cost may increase. FSIS, under the Pathogen Reduction and 
HACCP rule, has implemented a prevention based food production system 
that, in part, sets product specific limits on the prevalence of 
Salmonella in raw meat and poultry products. Recently reported test 
results from the first full year of HACCP indicate that Salmonella 
prevalence on broilers, ground beef, hogs, and ground turkey were lower 
after HACCP implementation. Continued monitoring of both the Salmonella 
prevalence in raw products and, through NARMS-EB, the antimicrobial 
resistance profiles of Salmonella and Campylobacter isolates will 
better enable us to characterize the public health impact of 
antimicrobial resistant foodborne pathogens.
    FDA answer. Development of resistance in foodborne pathogens is a 
medical and public health concern. Drugs may lose all or some of their 
effectiveness in treating patients with bacterial infections. If 
resistant foodborne pathogens develop because of antimicrobial drug use 
in food animals, food products may be contaminated at slaughter and the 
resistant bacteria transmitted to humans. Even if the bacteria are not 
pathogenic to the animal they can be pathogenic to humans. For example, 
Salmonella, Campylobacter, and E. coli O157 can exist in the intestinal 
flora of various food-producing animals without causing illness. 
However, all three bacteria can cause severe foodborne illness in 
humans. If the bacteria that cause illness in humans is resistant to a 
drug used for treatment, medical therapy may be effected.
    There are several concerns. When the microbes that affect people 
become resistant to the antibiotics used to treat the infections, 
treatment becomes more difficult, less likely to be successful, and 
more expensive. That means longer illnesses, higher medical costs, and 
ultimately, more deaths. Also, when the microbes become resistant, they 
can spread more easily and cause more illness in humans or animals that 
are already taking antibiotics for other reasons. This means that 
someone taking an antibiotic to treat one infection, may become ill 
with a second infection caused by a resistant organism. Finally, the 
genes that make the bacteria resistant are often mobile, so that 
different kinds of bacteria can swap the genes back and forth, and 
collect them in clusters of genes. This means that resistance that 
appears in one bacteria can subsequently spread to other bacteria, and 
can become linked to other resistance genes. Then the use of one 
antibiotic can select for all of the resistances that are linked 
together. For these reasons, the use of antibiotics in humans and in 
animals needs to be prudent and justified, because each use is also 
selecting for more resistance in the future.
    Question. I understand FDA has begun a major revision of its 
guidelines for approving use of new antibiotics for animals and for 
monitoring the effects of old ones. What revisions will you propose and 
will these have a significant impact on the availability and uses of 
antimicrobials?
    FDA answer. FDA has determined that the current regulatory 
structure for the approval of antimicrobial new animal drugs is 
inadequate for evaluating the antimicrobial resistance impact on human 
health. FDA is therefore undertaking an extensive process to evaluate 
issues related to the use of all antimicrobial drugs in food-producing 
animals and develop policies that protect the public health, including 
products already on the market. Our goal in this process is to protect 
public health by ensuring that significant human antimicrobial 
therapies are not compromised due to the use of antimicrobials in food 
animals, yet provide for future approvals and safe use of 
antimicrobials in animals.
    FDA's proposed regulatory framework is based on scientific 
evaluation of the hazards to public health from the use of 
antimicrobials in food animals. The proposed framework takes into 
consideration two factors that would be used in evaluating human health 
concerns associated with food-animal use of antimicrobials. These 
factors are the importance of the drug or class of drugs for human 
medicine, and the potential exposure of humans to resistant pathogens 
or resistant elements originating from animals treated with 
antimicrobials, and the impact this exposure would have on the 
availability and effectiveness of drugs to treat human disease. FDA 
would then place the drug or related drug in one of three major tiers 
according to the drug's importance. Each tier would have different 
requirements for approval. The requirements for approval may include 
both pre-approval screening and post-approval monitoring conducted on 
farms.
    FDA now believes it is necessary to evaluate the human impact of 
microbial effects associated with uses of all classes of antimcirobial 
new animal drugs intended for use in food-producing animals. FDA will 
evaluate the safety of antimicrobial products according to two factors. 
One is resistance, that is the quantity of resistant bacteria formed in 
an animal's intestinal tract (enteric) following exposure to the drug. 
The second is the pathogen load which is the changes in the number of 
animal enteric bacteria that cause human illness.
    To address concerns, the framework document proposes that sponsors 
of antimicrobial products need to evaluate microbial safety, including 
assessment of pathogen load and antimicrobial resistance; assess pre-
approval data showing that the level of resistance transfer from 
proposed uses of drugs, if any, will be safe for consumers of food 
products derived from treated animals; and establish acceptable 
thresholds prior to approval to ensure that approved uses do not result 
in resistance development in animals or transfer to humans above 
established levels.
    Question. I understand that some consumer, health, and 
environmental groups are seeking a federal ban on feeding of 
antibiotics to livestock given developing evidence of immunity in 
strains of bacteria that infect humans. Do you advocate an outright 
ban? What is FDA's authority to remove drugs that may be found to cause 
human pathogens to build resistance to the antimicrobials?
    FDA answer. FDA is engaged in discussions to resolve questions 
about appropriate uses of antibiotics, and the Agency is very concerned 
about the ever-expanding antibiotic resistance in organisms that cause 
illness in humans. Our draft framework document entitled A Proposed 
Framework for Evaluating and Assuring the Human Safety of the Microbial 
Effects of Antimicrobial New Animal Drugs Intended for Use in Food-
Producing Animals sets out a conceptual risk-based process for 
evaluating the microbial safety of antimicrobial drugs intended for use 
in food-producing animals. This document has been released to the 
public and has been the subject of a great deal of appropriate public 
debate.
    FDA has the authority under Section 512 of the Federal Food, Drug, 
and Cosmetic Act to withdraw approval of applications of new animal 
drug products, including antimicrobials, when certain conditions are 
met such as the drug is shown to be unsafe under its approved 
conditions of use. Sponsors of applications for such products must be 
given an opportunity for a hearing on the proposed withdrawal. Section 
512 also gives FDA the authority to suspend an approval if the 
Secretary finds the drug poses an imminent hazard to the health of man 
or animals. In such cases, sponsors must be given an opportunity for an 
expedited hearing on the suspension. That section also gives FDA the 
authority to revoke an approval through a notice-and-comment process.
    If FDA suspends or withdraws an approval, any product covered by 
the suspension or withdrawal that is subsequently offered for sale is 
considered adulterated and subject to seizure or other remedies.
       food safety research by the agricultural research service
    Question. The Agricultural Research Service (ARS) is requesting an 
increase of $7.3 million for on-farm food safety research. What percent 
of ARS research is on-farm and post-harvest? What are the current 
funding levels for each?
    USDA answer. In fiscal year 1999, the Agricultural Research Service 
devotes 59 percent of its food safety funding to on-farm research and 
41 percent to post-harvest research. The current funding levels are 
$41,078,200 for on-farm research and $28,789,400 for post-harvest 
research.
    Question. Antibiotic use in animals is suggested as a contributing 
cause to pathogens in food producing animals and human infection. 
Please explain this problem; the research that has been done in this 
area and your proposals to confront this issue. (ARS)
    USDA answer. The emergence of resistance to antibiotics has 
compromised control of some bacterial pathogens both in humans and in 
food producing animals. The problem starts with the inherent variation 
in all bacterial populations; when bacterial pathogens are exposed to 
antibiotics, or other control technologies, such as, heat, cold, low 
pH, high salt, or disinfectants, a few individual bacterial cells 
survive. But since these bacteria now have less competition, the 
resistant bacteria are able to grow and reproduce faster. Thus after a 
period of time if the selection pressure continues, the resistant 
bacteria outnumber the original susceptible population. A confounding 
factor is that the genes coding for this resistance may be transferred 
between different bacteria, and thus a bacteria population could become 
resistant even though they have not previously encountered the drug. 
Additionally pathogens can acquire resistance to multiple antibiotics.
    It is possible that pathogens that have become resistant through 
antibiotic use in animals may be transmitted to humans; and if humans 
subsequently need to be treated with an antibiotic for this or other 
pathogens, a different antibiotic would be necessary. The frequency of 
the occurrence of this transmission is not known.
    Research has helped to delineate the occurrence of antibiotic 
resistance in both human and animal isolates, and to elucidate the 
genetic basis of many of the types of antibiotic resistance. The latter 
information will help to associate specific types of resistance in 
humans and in animals. Research has not helped to answer the question 
of whether low level growth promoting uses of antibiotics in animals 
contribute to the incidence of antibiotic resistance in human 
pathogens; nor do we have data on the true incidence of resistance in 
humans, animals, and environmental reservoirs.
    To help solve these problems and prolong the useful life of 
antibiotics, ARS is initiating research programs to develop rapid tests 
for the presence of antibiotic resistance, to determine how both 
pathogens and nonpathogens acquire and transfer antibiotic resistance 
and at what levels of antibiotic exposure, define any alterations in 
virulence which may be linked to the presence of resistance, and to 
determine sources and interaction of antibiotic resistant pathogens in 
the environment, that is, their population genetics. This information 
will help form the basis for risk assessments of the use of specific 
antibiotic in both humans and animals.
    FDA answer. Just as there are many human infections where the human 
use of antibiotics can lead to resistance, so are there also infections 
in animals were the growing tide of resistance is making veterinary 
therapeutic drug choices more limited and difficult. Foodborne 
infections represent a crossover point, where the problems of 
resistance in the animal sector affect humans. In addition, resistance 
can develop in non-pathogenic bacteria in animals from exposure to 
antimicrobial drugs. Public health risks also occur from the transfer 
of resistance genes from animal commensals to human pathogens in the 
animal, on food or in the human gut.
    Antibiotic use in animals leads to resistance in the bacteria that 
inhabit the animals, including foodborne bacteria such as Salmonella 
and Campylobacter. When those bacteria contaminate the foods we eat, we 
can become ill. When the bacteria is resistant to antibiotics that are 
used to treat human infection, serious infections become harder to 
treat. It takes the laboratory some time to determine the resistance 
pattern, so the first treatment is based on past experience of what 
will work. For example, the drug of choice for the treatment of severe 
salmonellosis is a fluoroquinolone. If the Salmonella is already 
resistant to fluoroquinolones, then treatment may fail, and there is a 
delay in finding a treatment that will work.
    Through surveillance, CDC is documenting rising resistance in 
Salmonella and Campylobacter, which is making the choice of antibiotics 
more problematic. CDC investigates illnesses to determine the sources, 
and for some resistant Salmonella, CDC has traced the sources back to 
farms where antibiotics were being used imprudently, or where there 
were ill animals. CDC and FDA use this information to guide the 
development of specific prevention strategies.
    The principle strategies for controlling the rising tide of 
resistance are: To make sure that antibiotic use is prudent and 
rational; to use different antibiotics in humans and animals as much as 
possible; and to promote better prevention so that infections do not 
happen in the first place. Non-essential uses of antibiotics need to be 
limited or stopped, so that their effectiveness can be preserved to 
treat sick humans and animals. CDC has been working closely with the 
FDA Center for Veterinary Medicine, and with EPA (which regulates the 
use of antibiotics on fruit trees and in boat paint) to promote the 
concepts of prudent use. The FDA has proposed a new framework for 
regulating the uses of antibiotics in animal production that 
incorporates public health concerns about resistance. CDC believes that 
the combination of prudent use and prevention will actually lead to 
better animal and human health, as the usefulness of available 
antibiotics will be extended.
    If resistant foodborne pathogens develop in response to 
antimicrobial drug use in food animals, food products may be 
contaminated at slaughter and the resistant bacteria transmitted to 
humans. In addition, when antimicrobial drugs are administered to food-
producing animals they promote the emergence of resistance in bacteria 
that may not be pathogenic to the animal but can be pathogenic to 
humans.
    FDA has determined that the current regulatory structure for the 
approval of antimicrobial new animal drugs is inadequate for evaluating 
the human health impact of antimicrobial resistance. FDA is therefore 
undertaking an extensive process to evaluate issues related to the use 
of all antimicrobial drugs in food-producing animals and develop 
policies that protect the public health, including products already on 
the market.
    We would be happy to provide for the record the paper entitled The 
Issue of Antimicrobial Use in Food Animals. This paper describes the 
research that has been done in this area.
    [The information follows:]
             the issue of antimicrobial use in food animals
    The issue of antimicrobial use in food animals has been 
controversial for more than three decades. The Food and Drug 
Administration (FDA) first called for several restrictions on 
antimicrobial use in feed in 1977. That proposal has generated several 
studies and reports. Definitive answers about the safety of 
antimicrobial use in animals remain scientifically challenging, but we 
are continuing to uncover more truths and, more important, have begun 
updating FDA's process for determining whether antimicrobial products 
can be used in food animals.
    In the United States, FDA is the primary Federal agency responsible 
for ensuring the safety of the food supply. While the Center for Food 
Safety and Applied Nutrition regulates the vast majority of human food, 
FDA's Center for Veterinary Medicine (CVM) ensures that animal drug 
products are effective and safe for animals and consumers of edible 
products from treated animals.
    CVM, which is part of FDA, is responsible for establishing the 
safety assessments for the use of antimicrobial drugs in food from 
animals, and the U.S. Department of Agriculture (USDA) is primarily 
responsible for testing the meat supply for microbiological 
contamination and animal drug residues in the food from animals.
    Although the use of antimicrobial products in food-producing 
animals raises various efficacy and safety concerns, in recent years 
these concerns have focused on human food safety because foods of 
animal origin are often identified as the vehicles of foodborne disease 
in humans. As a result of treatment of the animal with antibiotics, 
these microbes may also be resistant to antibiotics used to treat 
humans.
    The source for some of the pathogens found on food may be the colon 
of the slaughtered animal. Feces that contain harmful bacteria can 
contaminate the meat at slaughter. An estimated 1 percent of beef 
carcasses and possibly 20 percent of poultry carcasses are contaminated 
with Salmonella.
    Treatment of food-producing animals with antimicrobials may alter 
pathogen load and/or the resistance pattern of bacteria associated with 
the animal. Thus, to ensure the human food safety of edible animal 
products from animals treated with antibiotics, CVM considers these 
criteria for non-therapeutic uses:
  --The safety of the chemical residues, including the drug and its 
        metabolites.
  --The microbiological safety, including changes in bacterial pathogen 
        load and resistance pattern that occur as a result of drug use.
    The use of antibiotics to treat disease in food-producing animals 
started in the mid-1940s.
    The scientific debate over the possible public health risks posed 
by such use started more than 30 years ago, when researchers first 
reported that the addition of streptomycin to chicken feed increased 
the rate of growth of the chickens. The introduction of affordable 
antibiotics in feed for cattle, pigs, and chickens started in the early 
1950s. It launched a new era in livestock management and meat 
production.
                          research and actions
    Soon after livestock producers began using antimicrobials in food-
producing animals, scientists began studying the possible effects of 
long-term use of antibiotics. Here's a review of the studies and 
reports to date.
1960 Netherthrope Committee
    It was formed in the UK to consider possible human health 
implications from the use of subtherapeutic antibiotics in livestock 
and concluded that there was no evidence of a human health hazard 
associated with the use.
1969 Swann Committee
    Also formed in the U.K., the committee reported no Howard to humans 
or animals from the use of antibiotics in poultry or swine. However, it 
linked an outbreak of salmonellosis in humans to the therapeutic use of 
antibiotics in sick calves. The committee recommended:
  --Antibiotics used in animals should be divided into ``feed'' or 
        ``therapeutic'' classes.
  --The ``feed'' antibiotics class should not include drugs used 
        therapeutically in humans or animals.
  --``Therapeutic'' antibiotics should be available only by 
        prescription.
1970 FDA Task Force
    The task force report, ``The Use of Antibiotics in Animal Feeds,'' 
concluded:
  --The use of subtherapeutic amounts of antimicrobials favored the 
        selection and development of resistant bacteria.
  --Animals receiving antimicrobial treatment may serve as a reservoir 
        of antibiotic resistant pathogens that can produce human 
        disease.
  --The prevalence of multi-resistant bacteria in animals has increased 
        due to the use of antimicrobials.
  --Resistant bacteria are present in meat and meat products.
  --There has been an increase in the prevalence of antimicrobial 
        resistant bacteria in man.
    Based on the report's recommendations, CVM began requiring 
microbiological safety studies for non-therapeutic uses. The focus of 
these studies was to preserve efficacy and safety of antibiotics for 
animal uses, and the safety evaluation included an evaluation of human 
health concerns.
1977 CVM Proposal
    In 1977, CVM proposed to withdraw the subtherapeutic uses of 
penicillin and the tetracyclines from animal feeds when used alone or 
in combination. These two drugs were chosen because of their importance 
in human medicine.
    The proposals were criticized at the time because of a lack of 
epidemiological evidence to show that the drug-resistant bacteria of 
animal origin are commonly transmitted to humans and cause serious 
illness. Critics argued that, while antibiotics used in animals select 
for resistant bacteria, the transfer of these bacteria from animals to 
humans is rare. Also, the critics said, no evidence showed that ``any 
transferred organisms actually survive or cause disease in humans. The 
critics argued instead that the increased antibiotic resistance of 
bacteria found in humans was a result of the use of antibiotics in 
human medicine.
1980 NAS Study
    As a result of the 1977 proposal, several studies were started. In 
1978, FDA began to work with the National Academy of Sciences (NAS) to 
study the issue. In 1979, the
    Congress required FDA to spend $1.5 million of its appropriations 
for a study of the antibiotics issue, to be conducted by NAS. The NAS 
study was finished in 1980. It concluded that existing data had neither 
proved nor disproved the potential hazards to human health from 
subtherapeutic antimicrobials use in animal feeds.
1984 NRDC Petition
    In 1984, the Natural Resources Defense Council, Inc., (NRDC) 
petitioned the Department.
    Health and Human Services (HHS) to suspend immediately approval of 
the subtherapeutic use of penicillin and tetracyclines in food animals 
by invoking the imminent hazard provision of the Food, Drug, and 
Cosmetic Act, 21 U.S.C. Sec. 360b(E)(1). That provision authorizes the 
Secretary of HHS to suspend approval of an application for the use of a 
new animal drug if an imminent hazard exists to the health of man or to 
the animals for which the drug is intended. NRDC based its case on 
several studies, two by Holmberg, et al., at the CDC in Atlanta, GA and 
one published by Thomas O'Brien, et al., in the New England Journal of 
Medicine. However, in November 1985, HHS denied the petition on the 
basis that an ``imminent hazard'' had not been demonstrated. This 
decision was based on an analysis of the NRDC's evidence as well as 
scientific evidence, information, and opinions coming out of the 
January 1985 public hearing and other relevant data collected and 
analyzed by FDA.
1984 King County Study
    In 1981, the House Appropriations Committee provided money in FDA's 
budget for a definitive epidemiological study of the antibiotics in 
animal feeds issue. The Committee stated that FDA should hold in 
abeyance any implementation of the proposed withdrawal pending 
completion of the studies and reevaluation of FDA's concerns. FDA 
contracted with the Communicable Disease Control Section of the 
Seattle-King County Department of Public Health to review the 
possibility of the movement of bacteria from chickens to humans. The 
study focused on poultry workers, slaughterhouse workers, and 
consumers. The report, ``Surveillance of the Flow of Salmonella and 
Campylobacter in a Community,'' found that Campylobacter jejuni was 
more common than Salmonella on poultry. Also, it found that C. jejuni 
``does appear to flow from chickens to man via consumption of poultry 
products.'' The report stated that the ``isolates from human cases and 
those from retail poultry had similar antibiotic susceptibility 
patterns, including prevalence of 29.7 percent and 32.8 percent, 
respectively, for tetracycline resistance, which was found to be 
plasmid-mediated.''
1987 FDA Report
    In its report, ``Antibiotics in Animal Feeds: An Assessment of 
Scientific Data Concerning Their Safety,'' FDA concluded that the 
therapeutic use of antibiotics would not significantly contribute to 
the frequency of resistant organisms because of the pattern of use of 
these products. Therapeutic use is typically for a select number of 
animals and for a short duration, situations that are not likely to 
lead to antibiotic resistance, the report said.
1988 IOM Review
    In 1988, the Institute of Medicine (IOM) again reviewed all the 
information about the antibiotic resistance issue available. An expert 
Committee was convened to determine the human health risks associated 
with the practice of feeding subtherapeutic levels of penicillin and 
tetracyclines to animals for growth promotion, feed efficiency, and 
disease prevention. In the report, ``Human Health Risks with the 
Subtherapeutic Use of Penicillin or Tetracyclines in Animal Feed,'' the 
Committee developed a risk-analysis model, using data only on 
Salmonella infections that resulted in human death. The Committee found 
a considerable amount of indirect evidence implicating both 
subtherapeutic and therapeutic use of antimicrobials as a potential 
human health hazard, but did not find data demonstrating that use of 
subtherapeutic penicillin or tetracycline directly caused a human to 
die from salmonellosis. The Committee strongly recommended further 
study of the issue.
1995 AMS Report
    The American Society of Microbiology (ASM), which includes members 
who specialize in medical and animal microbiology, issued a report in 
1995 that cited grave concerns about both human and animal antibiotic 
use and the rise in antimicrobial resistance. The report advocated a 
significant increase in resistance monitoring in the U.S., more 
education about the use and risks of antimicrobials, and more basic 
research designed to develop new antimicrobials and vaccines and 
disease prevention measures. The report criticized overuse of 
antibacterials in human medicine, but also pointed out the large use in 
food production, which was partly attributed to the consolidation of 
farms to facilities with large numbers of confined animals. The report 
made it clear that the antibiotic resistance problem is global. The ASM 
report was a precursor to involvement by the United Nation's World 
Health Organization (WHO).
1997 WHO Meeting
    In October 1997, WHO convened a meeting of experts in Berlin, 
Germany, to review the question of whether the use of antimicrobials in 
animals leads to antimicrobial resistance in humans. The experts sought 
to define potential medical problems that could arise from 
antimicrobial use in livestock and to recommend actions that the WHO 
should take. The group of experts recommended against using 
antimicrobials for growth promotion if those antimicrobials are also 
used in human medicine or can induce cross-resistance to antimicrobials 
used for human medical therapy. The group also recommended that 
research be conducted on non-antimicrobial growth-promoters and urged 
that the risk to human health from use of antimicrobials in food 
animals be accurately assessed. The group called for enhanced 
monitoring of resistance among isolates of enteric bacteria from food 
animals and food of animal origin. In addition, the group recommended 
managing risk at the producer level through the prudent use of 
antimicrobials.
1998 WHO Meeting
    In June 1998, the WHO held another meeting, this time in Geneva, 
Switzerland, to specifically address the use of quinolones in food-
producing animals. The participants agreed that the use of 
antimicrobials will cause resistance to develop and that there is a 
potential human health hazard from resistant Salmonella, E. colt, and 
Campylobacter organisms transferred to humans through the food supply. 
However, the experts also agreed that antimicrobial drugs, including 
quinolones in certain instances, are needed to treat sick animals, and 
urged more research on the possible human health effects from the use 
of these drugs in animals.
1998 CSPI Report
    In May 1998, the Center for Science in the Public Interest (CSPI), 
in a coalition that included 15 other health and consumer groups, 
produced a comprehensive report on the antibiotic resistance problem. 
The focus of the report was on human antimicrobial use; however CSPI 
made several recommendations regarding the use of antimicrobials in 
veterinary medicine. The report recommended that FDA ban all 
subtherapeutic uses of antimicrobial agents that are used in human 
medicine or might select for cross resistance to antimicrobials used in 
human medicine. The organization also expressed concerns about new 
human antimicrobials that may be at risk due to use of the same class 
of drugs in agriculture, at either subtherapeutic or therapeutic 
levels. Development of resistance to certain classes of drugs that are 
considered vital in human medical therapy, such as the 
fluoroquinolones, would cause particular concerto For this reason, CSPI 
recommended that FDA repeal approval of fluoroquinolones in poultry and 
allow additional approvals of fluoroquinolones only if the drug sponsor 
can show that those uses would not reduce the drug's effectiveness for 
human medical therapy.
1998 NRC Report
    In July 1998, the National Research Council (NRC) produced a report 
reviewing antimicrobial resistance issues in broad terms. The NRC 
recommended establishing a national databases to support scientific 
process and policy development for approval and use of antibiotics in 
food animals. The NRC also recommended that FDA use interdisciplinary 
panels of experts so that ``. . . further development and use of 
antibiotics in both human and animal medicine have oversight by an 
interdisciplinary panel of experts composed of representatives of the 
veterinary and animal health industry, the human medicine community, 
consumer advocacy groups, the animal production industry, and the 
regulatory agencies.''
1998 EU Action
    The European Union (KU) recently took action to minimize the 
agricultural use of antimicrobial drugs. In December 1998, health 
ministers for the EU voted to ban four antibiotics that are widely used 
at subtherapeutic levels to promote animal growth. The ban on using 
bacitracin zinc, spiramycin, tylosin, and virginiamycin in animal feed 
becomes effective for the fifteen member states of the EU on July 1, 
1999.
                             current issues
    For several years, CVM has approved new antimicrobials for use in 
animals for therapeutic purposes as prescription-only products. This 
prescription-only policy is based on CVM's desire to assure the proper 
use of antimicrobials though precise diagnosis and correct treatment of 
disease to minimize animal suffering and to avoid drug residues in 
food. Antimicrobial products for use in animals have to meet FDA's 
standards for safety, efficacy, and quality to be approved in the 
United States.
    When antimicrobial products are intended for use in food-producing 
animals, safety considerations include the evaluation of data to ensure 
that residues in food derived from treated animals are safe for human 
consumption. In the past, microbiological safety studies were required 
only for antimicrobials to be used in feed for more than 14 days. These 
studies examined resistance patterns and pathogen load.
    In the 1990s, several scientists raised concerns about the 
therapeutic use of fluoroquinolone antibiotics in food-producing 
animals. The scientists said the use could lead to enteric disease in 
humans associated with fluoroquinolone-resistant zoonotic pathogens. At 
least part of this concern was prompted by the fact that the search for 
new antimicrobial drugs and other novel agents to combat bacterial 
pathogens had decreased in recent years, leaving fluoroquinolones as 
the last family of therapeutic agents available to treat some multiply 
resistant organisms. Adding to that concern were reports of a temporal 
association between the approval of fluoroquinolone for therapeutic use 
in poultry and the emergence of a fluoroquinolone-resistant 
Campylobacter spp. from humans.
    To further investigate the public health concerns regarding the 
potential impact of fluoroquinolone use in food-producing animals and 
to determine whether the 1987 FDA report (which concluded that 
therapeutic antimicrobials used for short duration were safe) was still 
valid, FDA held a Joint Advisory Committee meeting in 1994 that 
included the CVM Advisory Committee and the Center for Drug Evaluation 
and Research's Anti-infective Drugs Advisory Committee. The joint 
committee recommended that fluoroquinolones be approved, but that the 
use of the drugs should be limited to prescription only, that no extra-
label use should be allowed, and that resistance should be monitored 
after the product was approved.
    CVM created a Fluoroquinolone Working Group to address the points 
raised by the joint committee. The Working Group offered seven 
recommendations, all of which were accepted by CVM, and subsequently 
the use of fluoroquinolones was approved for poultry. As suggested in 
the recommendations, the sponsors agreed to provide baseline 
susceptibility information and to conduct continuing monitoring of 
target animal pathogens through the post-approval monitoring program.
    More recently, scientists have detected a new multi-resistant 
pathogen, Salmonella typhimurium DT104. The organism carries 
chromosomally integrated resistance to
    Ampicillin, Chloramphenicol, Streptomycin, Sulphonamides, and 
Tetracycline. This chromosomally integrated resistance is unique and 
raises concerns about the establishment of a reservoir of multi-drug 
resistant organisms that are zoonotic enteric pathogens that may become 
endemic in food-animal microbial populations. In addition to the 
chromosomally borne pen/a-resistance, the organism seems to be losing 
its susceptibility to quinolone and trimethoprim antibiotics and has 
been recently shown to carry additional florfenicol and spectinomycin 
resistance.
    A report from the UK suggests that infections caused by DT104 may 
be associated with greater morbidity and mortality than other 
infections by Salmonella. An association has been noted between loss of 
susceptibility to fluoroquinolones among DT104 isolates and the 
approval and use of a fluoroquinolone for veterinary therapeutic use in 
the UK. This organism has also been identified in livestock and poultry 
in the U.S. Human disease caused by DT104 in the U.S. has been 
associated with unpasteurized dairy products and direct contact with 
livestock.
    DT104 is currently epidemic in human and animal populations in 
Great Britain and has been isolated from most countries in Europe. The 
organism more recently has been found in the U.S. and appears to be 
increasingly prevalent in both domestic and wild animals. The most 
notable outbreak of DT104 was on a dairy farm in Vermont.
    The DT104 findings caused FDA to aggressively move ahead with plans 
to change the regulatory framework for approving antimicrobial 
products. The discovery of DT104 was a turning point for FDA, and led 
to the development of a proposed regulatory course for the Agency.
    Reports from the scientific and public health communities, both 
domestically and internationally, have identified concerns about the 
relationship between the approval of fluoroquinolones for therapeutic 
use in food-producing animals and the development of fluoroquinolone 
resistance in Campylobacter. The approval of these drugs in food-
producing animals in the Netherlands, the UK, and Spain temporally 
preceded increases in resistance in Campylobacter isolates from humans. 
Despite several restrictions placed on the use of the two approved 
poultry fluoroquinolone products in the U.S., ciprofloxacin-resistant 
Campylobacter were recently isolated from 20 percent of domestic retail 
chicken products sampled. Molecular subtyping revealed an association 
between resistant C. jejuni strains from chicken products and C. jejuni 
strains from domestically acquired human cases of campylobacteriosis.
Framework Document
    FDA's concept of the best regulatory approach for antimicrobial 
approvals is explained in what is called the ``Framework Document,'' 
(``A Proposed Framework for Evaluating and Assuring the Human Safety of 
the Microbial Effects of Antimicrobial New Animal Drugs Intended for 
Use in Food-Producing Animals''), which is available on the CVM Home 
Page at http://www.fda Pov/cvm/fda/infores/vmac/antiml8 him or http://
www.fda.Pov/cvm/fda/infores/vmac/antim18.pdf.
    The document was released to the public December 9, 1998, and the 
comment period was scheduled to last until April 6, 1999.
    The proposed framework takes into consideration two factors that 
would be used in evaluating human health concerns associated with food-
animal use of antimicrobials:
  --The importance of the drug or class of drugs for human medicine, 
        and
  --The potential exposure that humans would face to resistant 
        pathogens or resistant elements originating from animals 
        treated with an antimicrobial, and the impact this exposure 
        would have on the availability and effectiveness for human 
        medicine of drugs to which the resistance has developed.
    Depending on the importance of the drug (or a related drug) to 
human health, FDA would place it in one of three major Tiers. Each Tier 
would have different requirements for approval. The requirements for 
approval may include both pre-approval screening and post-approval 
monitoring conducted on farms.
    FDA's implementation of the framework will require the development 
of guidance documents and perhaps new or amended rules. All such 
guidance or rules would be developed with public input, and FDA will 
consider any needed change as a high priority.
    Under the framework document, antimicrobial drugs would be placed 
in Class I, the level with the greatest approval requirements, if:
  --They are needed to treat a serious or life-threatening disease for 
        which there is no satisfactory alternative therapy, and
  --They are important for the treatment of foodborne diseases.
    Drugs that can select for cross-resistance to Class I human agents 
would also be listed in Class I, unless the sponsor could demonstrate 
that animal use did not result in the induction of resistant pathogens 
or the transfer of resistant elements to human pathogens.
    Drugs would be placed in Class II if:
  --They are of high importance or are the drugs of choice to treat a 
        serious or life-threatening disease, but a satisfactory 
        alternative therapy exists.
  --They are members of a class of drugs that have a unique mechanism 
        of action or nature of resistance-induction, that rarely 
        produce resistance in human pathogens, and that hold potential 
        for long-term therapy in human medicine.
    FDA would put products into Class III if they do not meet any of 
the requirements of the other two classes.
NARMS
    CVM now believes that the safety assessment of antimicrobials must 
include evaluation of resistance concerns with the conduct of pre-
approval studies and post-approval monitoring programs, which are aided 
by the National Antimicrobial Resistance Monitoring System (NARMS).
    The program was proposed by CVM as a post-marketing activity to 
monitor the emergence and spread of resistance in enteric bacteria and 
to help ensure the continued safety and effectiveness of veterinary 
antimicrobials. In 1996, the FDA, CDC, and the USDA created NARMS to 
prospectively monitor changes in antimicrobial susceptibilities of 
zoonotic enteric pathogens from human and animal clinical specimens, 
from healthy farm animals, and from carcasses of food-producing animals 
at slaughter. Non-typhoia Salmonella was selected as the sentinel 
organism; the NARMS has been expanded each year since its inception. At 
the present time, NARMS is monitoring susceptibilities of Salmonella 
and E cold isolates to 17 antimicrobics and Campylobacter isolates to 8 
antimicrobics (azithromycin, chloramphenicol, ciprofloxacin, 
clindamycin, erythromycin, gentamycin, nalidixic acid, and 
tetracycline).
    Veterinary testing is conducted at USDA's Agricultural Research 
Service Russell Research Center. Human isolate testing is conducted at 
CDC's National Center for Infectious Diseases Foodborne Disease 
Laboratory. Seventeen State and local health departments (CA, CO, CT, 
FL, GA, KS, Los Angeles County, MA, MD, MN, NJ, New York City, NY, OR, 
TN, WA, and WV) submit human clinical isolates of non-typhoid 
Salmonella and E. coli. Eight health departments are submitting human 
clinical Campylobacter isolates, and in addition MN, GA, MD, and OR are 
submitting Campylobacter isolates from poultry retail samples. A pilot 
study involving MN, GA, MD, and OR to monitor the resistance of human 
and poultry Enterococcus isolates to 27 antimicrobials was begun in 
1998.
    The goals and objectives of the monitoring program are to provide 
descriptive data on the extent and temporal trends of antimicrobial 
susceptibility in Salmonella and other enteric organisms from the human 
and animal populations; provide timely information to veterinarians 
physicians; prolong the life span of approved drugs by promoting the 
prudent use of antimicrobics; identify areas for more detailed 
investigation; and guide research on antibiotic resistance. Annual 
reports summarizing the data are available on the Internet (http://
www.fda.gov/cvm/fda/mappos/narms/html and www.cdc.gov/ncidod/dbmd/
narms).
    The NARMS was substantially expanded during 1998. Veterinary 
diagnostic lab sentinel sites were enrolled as well as additional sites 
to gather human isolates, and the number of Salmonella isolates 
collected from slaughter plants was increased. Beginning January 1, 
1999, the State and local health departments began to submit human S. 
typhi and Shigella isolates.
    Also in 1998, follow-on epidemiology research and investigations 
augmented the program. On-farm poultry studies were begun in five 
states, which are designed to elaborate management, production, and 
drug use practices that influence the development of resistant zoonotic 
pathogens. Collaborative molecular genetic studies have begun at FDA's 
National Center for Toxicological Research in Arkansas to identify 
regions of fluoroquinolone resistance in zoonotic enteric organisms. 
This information will be applied to enteric and environmental bacteria 
to provide improved monitoring for resistance emergence and transfer. 
Case-control follow-up investigations of human cases of salmonellosis 
and campylobacteriosis with losses in susceptibility to quinolones were 
begun in 1998. Also in 1998, two projects on prudent drug use 
activities were initiated in California and Michigan.
PRUDENT USE
    CVM believes it is critical that prudent use of antimicrobials be 
emphasized in order to minimize the development of antimicrobial 
resistance and to ensure the continued efficacy and availability of 
antimicrobial products for use in food-producing animals. To promote 
this concept, CVM and CDC facilitated a meeting on ``Prudent Use'' held 
in May 1998 in Rockville, Maryland.
    The objective of the meeting was to develop a plan to promote the 
Prudent Use of therapeutic antimicrobials in veterinary medicine. At 
the meeting, several groups agreed to develop programs about Prudent 
Use, and the effort was led by the American Veterinary Medical 
Association (AVMA), which has developed its Prudent Use program of 
``Judicious Use.''
    The Executive Board of AVMA has agreed to principles concerning 
Judicious Use developed by a special AVMA Steering Committee. CVM and 
CDC provided experts to advise the Steering Committee. CVM strongly 
supports the effort to develop Judicious Use principles for veterinary 
practitioners, and will financially support efforts to publicize the 
guidelines.
    Key elements of Prudent Use that CVM believes should be addressed:
  --Development of Prudent Use principles.
  --Therapeutically based antimicrobial-use guidelines.
  --Recommendations on appropriate measures to reduce disease 
        transmission.
  --Educational programs for prescribers and users of these drugs.
    CVM defines Prudent Use of therapeutic antimicrobial agents as. . .
    ``. . . use that maximizes therapeutic effect while minimizing the 
development of resistance.''
    At the May 1998 meeting and in other contacts, CVM has and will 
continue to solicit advice from the human medical community in the 
development of Prudent Use principles because their expertise about 
what has worked and not worked in human medicine will be useful. The 
development of the Prudent Use principles won't be static. Instead, the 
process will likely demand continued attention. In fact, CVM will 
probably engage food animal producers on this issue at some time in the 
future.
    Question. The ARS budget request includes an increase of $2.4 
million to develop risk assessment predictive models. What modeling has 
been done to date in this area and how has it been implemented? (ARS)
    USDA answer. Risk assessments for pathogens have primarily been 
carried out in the postharvest arena to predict the frequency and the 
numbers of pathogens that might be present in specific food products 
such as eggs or ground beef. These numbers are then related to the 
frequency that sufficient pathogens might be present in a food to 
result in human illness. ARS has worked closely with the FSIS in the 
development of such a model for Salmonella enteritidis in eggs which 
was the basis of rulemaking by this USDA regulatory agency. It is now 
time to initiate the development of predictive microbiological models 
in preharvest animal production, and to help evaluate the effects of 
various production practices, interventions, and transportation systems 
on the risk of contamination of food producing animals as they are 
presented for slaughter.
    Question. What is the time frame for developing the models you 
propose in the fiscal year 2000 budget? When would they be implemented? 
Who would utilize the technology?
    You are requesting an additional $4,420,000 for post-harvest 
(slaughter and processing) research. This area has been ARS' major 
focus of pathogen contamination. Please summarize the progress made to 
date as a result of pathogen control strategies for Campylobacter, E. 
coliO157:H7, Listeria, and Salmonella.
    USDA answer. Acquisition of the research information needed to 
develop truly useful predictive models is a significant research 
activity that will take several years. Quantitative microbiological 
data must be developed, rather than just the incidence or quantitative 
data of the past; quantitative data is expensive and time consuming to 
obtain.
    The underlying research will require several years to develop the 
first data for the models. The first models will be available as soon 
as this phase is completed.
    These models would be utilized/implemented by producers to help 
them make informed decisions on which interventions will yield the best 
food safety results within their available resources and production 
situations.
    The progress made to date on postharvest research for the 
pathogens, Campylobacter, E. coli O157:H7, Listeria and Salmonella are 
as follows:
    Progress in the area of detection methods:
  --Monoclonal antibodies (MAbs) that bind specifically to 
        Campylobacter jejuni and Campylobacter coli have been 
        developed, and patented. These antibodies will be used in an 
        immunologically based method (ELISA) to improve the current 
        specific detection methods for Campylobacter.
  --A laser assisted method (MALDI) has been developed for the rapid 
        detection of Campylobacter. The methods advantage is that only 
        a single bacterial colony is needed for analysis. The MALDI 
        technique also has the potential to be widely used for 
        confirmatory analysis of other pathogenic bacteria.
  --A nucleic acid based (PCR) method was developed which 
        simultaneously detects enterotoxigenic and Shiga toxin-
        producing E. coli (O157:H7) strains from calves. The method is 
        being used by diagnostic laboratories to rapidly identify, 
        differentiate and characterize pathogenic E. coli. This change 
        will be useful to producers and veterinarians for the rapid 
        diagnosis of all the diseases caused by E. coli in calves.
  --An ELISA based test (immuno-precipitation pregnancy test design) 
        called Meridian was developed. The test uses monoclonal 
        antibodies to specifically detect all E. Coli O157 strains, not 
        just O157:H7. Meridian has found widespread use by food 
        companies since it has a much lower incidence of false 
        negatives than other comparable tests.
  --In cooperation with IGEN of Gaithersburg, MD, ARS has developed an 
        immunomagnetic electro-chemiluminescent (IM-EC) method for the 
        detection of E. coli O157:H7. The test is rapid, sensitive to 
        low numbers of bacteria, inexpensive, and user-friendly. The 
        technology is currently under evaluation by the FSIS.
  --Optimized methods to identify, differentiate, and characterize 
        pathogenic E. coli isolates from bovine sources were developed. 
        Anti-O157 Mabs in an ELISA format accurately detected serum 
        antibodies to E. coli 0111, in cattle and other livestock. 
        Serum detection of antibodies to E. coli O157:H7 will allow 
        accurate detection of all animals exposed to this pathogen at 
        any time during animal growth.
  --Research by ARS determined that automated nucleic acid based 
        ribotyping of Salmonella was a better discriminator between 
        isolates than serotyping. Ribotyping however, is not a 
        replacement for serotyping. It was recommended that for 
        epidemiological investigations, both techniques should be used 
        simultaneously.
    Progress in the area of pathogen reduction:
  --In order to determine the effectiveness of a pathogen reduction 
        method bacteria need to be modified to allow their 
        identification and discrimination from background microflora. 
        ARS has developed a genetic technique that allows the 
        construction of (model) pathogens that bioluminesce under UV 
        light due to production of a green fluorescent protein (GFP). 
        Various model strains of E. coli O157:H7 and Salmonella were 
        constructed having the same growth and attachment 
        characteristics as the wild type strain. This research 
        technology will aid in understanding the basis of microbial 
        attachment and detachment to animal carcasses in real-time. The 
        technology also offers a more rapid means to evaluate 
        antimicrobial carcass treatments that do not rely on sampling, 
        culturing and back-extrapolation of the resulting plate counts 
        to large surface areas.
  --ARS concluded research on washing and sanitizing hog hauling 
        trailers and holding pens. The results have led to procedures 
        to significantly reduce Salmonella, Campylobacter and E. coli 
        contamination on animals entering slaughter plants.
  --A surface pasteurization technique was developed to reduce 
        microbial contamination (almonella, Campylobacter and Listeria) 
        on the surface of solid foods without loss of quality. A 
        prototype design to briefly steam fresh whole broiler 
        carcasses, so that surface organisms are killed but with no 
        appreciable cooking of the meat, was built, tested and 
        patented.
  --Feed withdrawal in broilers prior to slaughter is used to induce 
        molt and to stimulate egg laying in aged flocks, however, 
        withdrawal increased infection rates in their crops by 
        Salmonella and Campylobacter. Research showed that methods such 
        as adding lactose to drinking water had the ability to restore 
        resistance, and reduce infection rates.
  --Various conventional and experimental wash formulations were 
        evaluated to determine their efficacy in decontaminating apples 
        of human pathogens (almonella, E. coli O157:H7, Listeria). 
        Solutions containing 5 percent hydrogen peroxide, alone or in 
        combination with acidic detergents achieved a 3-4 log pathogen 
        reduction. These studies demonstrated that current conventional 
        methods of washing apples are largely ineffective. Development 
        of efficacious cleaning methods for fruit are crucial for the 
        production of unpasteurized juices.
  --Low dose gamma irradiation was found to be efficacious for 
        destroying the human bacterial pathogens E. coli O157:H7, 
        Listeria and Salmonella on seed used for the growth of sprouts. 
        Irradiation is a useful technology that significantly reduces 
        pathogens in certain food commodities, while increasing shelf 
        life and maintaining freshness, all major consumer demands.
    Progress in the area of pathogen control through intervention 
strategies:
  --The discovery that electropolishing surfaces significantly reduces 
        attachment of pathogens such as Campylobacter and subsequent 
        biofilm formation. This finding will aid equipment 
        manufacturers in developing methods and selecting materials to 
        be used in processing foods.
  --It was discovered that some naturally occurring food additives 
        blocked the attachment of E. coli to bovine fascia and 
        connective tissues. Inhibition of E. coli O157:H attachment to 
        intact meat tissues by use of these substances will offer 
        processors an additional means to help to prevent E. coli 
        O157:H7 contamination of meats.
  --Controlled atmospheric storage of fresh produce does not appear to 
        offer a viable method for controlling Listeria monocytogenes. 
        Therefore, the fresh cut industry should consider alternate 
        methods for controlling this pathogen.
  --ARS in collaboration with FSIS conducted a nationwide evaluation of 
        color of cooked beef patties relative to potential food safety 
        risk for E. coli O157:H7. The study provided solid evidence 
        that cooked beef patty color is not a good indicator of 
        internal patty temperature. The results were a major factor in 
        the development of the new FSIS consumer message that 
        ``consumers should not eat ground beef patties that are pink or 
        red in the middle unless a food thermometer has been used to 
        verify cooked temperature.''
    Progress in the area of antimicrobial resistance:
  --The acid tolerance of E. coli O157:H7 contributes to its ability to 
        cause disease by increasing both its ability to persist in 
        food, and its infectivity. ARS developed a technique to induce 
        maximum acid tolerance in these microorganisms, and identified 
        that the sensitivity to acid inactivation is dependent on 
        acidulant identity, prior exposure to an acid environment, and 
        strain identity.
    Progress in the area of risk assessment:
  --Bioluminescent strains of Salmonella were used as a tool for 
        modeling behavior of Salmonella in raw and cooked poultry 
        products. The data were incorporated into version 2.0 of the 
        Salmonella--Risk Assessment Modeling Program for Poultry (-
        RAMPP). A new simulation model, the Food Animal Risk Model for 
        Poultry Pathogens (FARM-PP) was also developed which predicts 
        the severity of outcomes from consumption of poultry products 
        contaminated with Salmonella and/or Campylobacter.
    Question. Please identify and discuss food safety research that is 
specifically carried out to meet FSIS concerns. What other Federal 
agencies benefit directly from ARS food safety research? How are these 
needs expressed?
    USDA answer. ARS carries out both preharvest and postharvest food 
safety research to meet the needs of the FSIS, particularly for the 
implementation of HACCP. In many cases this research also meets the 
needs of other ARS stakeholders such as animal producers and slaughter 
and packing houses, and food processors. Both the regulatory agencies 
and producers use the results of the latest research to help assure the 
production and delivery of safe food. Preharvest food safety research 
develops information and technologies to control E. coli 1057:H7 in 
cattle, Salmonella sp. in poultry, swine and cattle, Campylobacter sp. 
in poultry and swine, and Cryptosporidia infections in cattle. In 
particular this research develops methodology to detect pathogens, and 
it develops interventions such as vaccines and competitive exclusion 
bacterial cultures for use by producers to prevent zoonotic pathogens. 
Other preharvest research is directed at determining the major factors 
in the genesis and dissemination of antibacterial resistance, and at 
developing strategies to help prolong the useful life of antibiotics.
    In the postharvest arena ARS develops improved methodologies to 
detect pathogens, including E. coli, Salmonella, Campylobacter and 
Listeria with needed accuracy and reliability using reproducible 
sampling methods that meet agency cost constraints. Other projects 
develop imaging systems that will detect lesions and help assure that 
only wholesome birds are passed for human food. Interventions or hurdle 
technologies are developed for slaughter and processing establishments, 
including the very small plants; these technologies include acid 
rinses, the use of steam and hot water, and chlorine replacements. 
Biofilms are studied as they are formed on processing equipment, and 
methods to disrupt this natural biological protection of pathogens are 
developed. Steam pasteurization and irradiation are developed as final 
effective hurdles to prevent the occurrence of most pathogens on food 
products of animal origin. Information on both survival and kill times 
for the important pathogens in various food systems under different 
environmental conditions are obtained to aid in FSIS decision making, 
in the development of HACCP programs and most importantly for risk 
assessment.
    Particular attention is being paid to Listeria, the pathogen 
recently recognized as responsible for a large number of food poisoning 
and deaths, and for which both FSIS and the food industry need answers. 
A rapid gene-based assay has been developed that can readily identify 
and differentiate Listeria species in various ready-to-eat foods, 
allowing for molecular fingerprinting and trace-back. A program has 
been initiated to develop technology to surface pasteurize food 
products, including hot dogs, which economically reduces microbial 
contamination without significant loss of product quality; and ARS is 
also defining the parameters required for irradiation of meats and meat 
products. ARS is determining the effect of various food components, and 
parameters (pH, water activity, salt, process and storage temperature) 
on the inactivation, survival and growth of Listeria in ready to eat 
products, and identifying new generally recognized as safe (GRAS) 
compounds that can be incorporated into foods as a antimicrobial agents 
to protect against Listeria and other pathogens. The FDA and CDC also 
directly benefit from ARS food safety research.
    The FDA's needs are expressed to ARS through continual dialogue 
between the agencies via meetings between the Chief Scientist at CFSAN/
FDA and his staff, and ARS Food Safety National Program Leaders. In 
order to ensure there is no duplication of efforts, there is a routine 
comparison of research agendas from each of the agencies and 
delineation of activities, and interaction between agencies on projects 
or issues of national importance when required.
    Question. Please identify and briefly describe the food safety 
research ARS performs at its various laboratories.
    USDA answer. ARS conducts research at the following laboratories:

------------------------------------------------------------------------
                                     Fiscal Year        Food Safety
             Location                   1999          Initiative Rsch
------------------------------------------------------------------------
Fayetteville, AR.................        $293,800  Prevention
Albany, CA.......................       7,734,800  Detection,
                                                    Prevention, Handling
                                                    & Distribution
Riverside, CA....................         592,800  Detection, Prevention
Athens, GA.......................       9,971,100  Detection,
                                                    Prevention,
                                                    Antibiotic
                                                    Resistance, Handling
                                                    & Distribution
Dawson, GA.......................         745,600  Detection
Tifton, GA.......................         564,500  Prevention
Ames, IA.........................       4,215,400  Detection,
                                                    Prevention,
                                                    Antibiotic
                                                    Resistance
Peoria, IL.......................       4,899,600  Detection, Prevention
West Lafayette, IN...............         296,400  Prevention
New Orleans, LA..................       3,039,000  Detection, Prevention
Beltsville, MD...................       8,168,400  Detection,
                                                    Prevention, Risk
                                                    Assessment, Handling
                                                    & Distribution
Beltsville, MD (NAL).............         219,600  Prevention
Mississippi State, MS............         669,100  Prevention
Raleigh, NC......................         491,800  Prevention
Fargo, ND........................       2,296,100  Detection, Risk
                                                    Assessment
Clay Center, NE..................       3,879,100  Detection,
                                                    Prevention, Handling
                                                    & Distribution
Ithaca, NY.......................         316,200  Prevention
Wyndmoor, PA.....................      13,245,900  Detection,
                                                    Prevention,
                                                    Antimicrobial
                                                    Resistance, Risk
                                                    Assessment, Handling/
                                                    Distribution
College Station, TX..............       4,722,600  Detection,
                                                    Prevention,
                                                    Antibiotic
                                                    Resistance
Lubbock, TX......................         281,600  Prevention
Logan, UT........................       2,147,300  Detection, Prevention
Headquarters.....................       1,076,900  Detection, Prevention
                                  -----------------
      Total......................      69,867,600
------------------------------------------------------------------------

    Question. Please identify the food safety research funding in REE 
agencies by each account. Provide for the record the funding 
appropriated from fiscal years 1990 to 1999. Also include the increase 
requested in the President's 2000 budget.
    USDA answer. The National Agricultural Statistics Service (NASS) 
did not have any expenditures related to food safety research in fiscal 
years 1990 to 1999 and has not provided funding to institutions for 
food safety related research projects. For the fiscal year 2000 
President's budget, NASS has one initiative for $2.5 million to conduct 
a fruits and vegetables food safety survey. Under this initiative, NASS 
would conduct a statistical survey of fruit and vegetable growers, as 
well as packing houses, to establish a baseline for good agricultural 
practices as they relate to microbial food safety issues.
    The food safety research funding for Economic Research Service 
(ERS) for fiscal year 1990 through fiscal year 1999 and the request for 
fiscal year 2000 are as follows:
        Fiscal Year
1990..........................................................  $325,000
1991..........................................................   550,000
1992..........................................................   550,000
1993..........................................................   550,000
1994..........................................................   500,000
1995..........................................................   485,000
1996..........................................................   485,000
1997..........................................................   485,000
1998..........................................................   485,000
1999..........................................................   938,000
2000.......................................................... 1,391,000

    In fiscal year 1997 and fiscal year 1998, ERS Food Safety funds 
were dedicated to ERS staff costs and the research was done internally. 
In fiscal year 1999 and fiscal year 2000, we plan to spend the 
initiative increases on extramural research programs to measure the 
benefits of food safety and to support economic analysis in risk 
assessment and surveillance. The recipient institutions have not been 
determined at this time. The food safety research funding for ARS for 
fiscal year 1990 through 1999 and the request for fiscal year 2000 are 
as follows:

        Fiscal Year
1990....................................................     $27,517,000
1991....................................................      33,087,900
1992....................................................      35,989,000
1993....................................................      35,989,000
1994....................................................      37,587,400
1995....................................................      43,840,300
1996....................................................      44,313,100
1997....................................................      49,647,300
1998....................................................      54,949,400
1999....................................................      69,867,600
2000....................................................      81,588,000

    Based on Food Safety Initiative Codes, in fiscal year 1999, ARS 
undertook 40 projects ($14.2 million) in detection of food borne 
pathogens; 70 projects ($37.9 million) in prevention and control; 7 
projects ($2.2 million) in antimicrobal/antibiotic resistance; 9 
projects ($4.9 million) in risk assessment; and 18 projects ($10.6 
million) in food handling distribution and storage. The increase 
requested for ARS in the President's fiscal year 2000 budget is 
$11,720,000 to be directed towards: Preharvest: manure handling and 
distribution-pathogen reduction ($2,500,000); risk assessment 
($2,400,000); antibiotic resistance ($1,800,000); fungal toxins 
($300,000); zoonotic disease risk ($300,000) and Postharvest: pathogen 
control during slaughter and processing ($700,000); pathogen control in 
fruits and vegetables ($2,100,000); antimicrobial resistance 
($1,620,000). The food safety research funding for CSREES, including 
formula funds, all special research grants, and the NRI, for fiscal 
year 1990 through fiscal year 1999 and the request for fiscal year 2000 
are as follows:

        Fiscal Year
1990..............................................................$5,790
1991.............................................................. 9,827
1992..............................................................12,002
1993..............................................................11,610
1994..............................................................14,117
1995..............................................................12,450
1996..............................................................11,644
1997..............................................................12,195
1998..............................................................14,727
1999..............................................................30,888
2000..............................................................39,536

    Food Safety programs previously in the research and extension 
activities are now reflected in the integrated activities for fiscal 
year 2000.
    Question. Please list the institutions receiving food safety 
funding from REE agencies' appropriations in each of fiscal years 1997 
to 1999, a description of each food safety research project funded in 
each fiscal year, and the progress which has been made to date through 
the research funded.
    USDA answer. Most ARS expenditures for food safety research are for 
in-house programs. The extramural institutions who have received 
funding (pass through dollars) from ARS during fiscal years 1997-1999 
are as follows: Mississippi Center for Food Safety and Postharvest 
Technology, Mississippi State University (MCFSPT); Agricultural and 
Home Economics Experiment Station, New Mexico State University (AHEES), 
Food Safety Engineering Center, Purdue University (FSEC); Institute for 
Technology Development, Stennis Space Center, Mississippi (ITD); and 
grants to various Land Grant, State Universities and research groups, 
including Iowa State University, University of Arizona, Texas A & M, 
Purdue University, University of S.W. Louisiana, North Carolina State 
University, Mississippi State University, University of California, 
University of California-Davis, University of Illinois, Georgia Coastal 
Plain Experiment Station, and the Arizona Cotton and Protection 
Council. These programs are managed via the National Program Staff 
(NPS).
    The extramural funding allocations for years 1997--1999 are as 
follows:

----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal Year     Fiscal Year     Fiscal Year
                             Center                                    1997            1998            1999
----------------------------------------------------------------------------------------------------------------
MCFSPT (Est.)...................................................        $314,335        $312,712        $312,712
AHEES...........................................................         118,000         114,000         114,000
FSEC............................................................  ..............  ..............         878,049
ITD.............................................................  ..............  ..............         219,000
Via NPS.........................................................         560,087         553,341         784,468
----------------------------------------------------------------------------------------------------------------

    Description of these extramural food safety research projects are 
as follows:
    Mississippi Center for Food Safety and Postharvest Technology.--
Project title/objectives: Detection and Treatment of Listeria and Other 
Bacteria in Channel Catfish. The major thrust of the project is to 
assess and help ensure the safety of channel catfish for sale 
throughout the United States. The research achievements of this project 
were: the development of an immunologically (ELISA)--medicated nucleic 
acid based method for the rapid detection of Listeria monocytogenes in 
foods; understanding the types of biofilms formed and the presence of 
various pathogens at the different processing stations; development of 
methods to detect the presence of antibiotics in channel catfish; and 
the identification of various pathogenicity vectors in Listeria. 
Processing and packaging technologies/treatments are being developed to 
reduce/eliminate microbial contamination to ensure product safety with 
extension of shelf life. Information from this research has been 
transferred to producers and processors, where it has been put into 
operation. Guidelines have been incorporated into HACCP program adopted 
for use by this industry.
    Agricultural and Home Economics Experiment Station.--Project title/
objective: Locoweed Ecology and Toxicology. The research in this 
project was aimed at determination of the cytokinetics (absorption, 
distribution, and excretion and clearance) of plants toxins from the 
tissue or products of animals that consume poisonous plants. The 
studies delineated the withdrawal time to ensure that animal products 
would be free from plant toxins. This information can be used for 
management strategies in many states. The research also improved animal 
productivity, and enhanced the utilization of pastures and rangelands 
where poisonous plants are found.
    Food Safety Engineering Center.--Project title: Rapid Pathogen 
Diagnostic and Detection Methods: This is a new project initiated in 
fiscal year 1999. The goal is the development and use of biosensor 
technology in food safety.
    Institute for Technology Development.--Project title: Online 
Detection Technology. This project initiated in fiscal year 1999 will 
develop real time on-line detection technology for rapid identification 
of surface contamination in poultry.
    National Program Staff.--Project title: Aflatoxin Research: Funds 
are distributed to numerous Land Grant and State Universities and the 
objectives of this project are varied. Some funding for projects is 
specifically made available on a competitive basis (intent of 
Congress). The aim of the program is the reduction of aflatoxins which 
are metabolities of the fungi Aspergillus flavus and A. parasiticus for 
agricultural products, for example, cottonseed, corn, peanuts and tree 
nuts. Aflatoxins is considered one of the most serious food safety 
problems, and chronic problems with aflatoxin contamination occur in 
the southern United States. Two areas of research and development have 
resulted from these studies: the development of novel genetic 
engineering and or marker-based breeding methods to enhance general 
antifungal resistance in crops; and the isolation and formulation of 
special fungi for use in biocontrol. The biocontrol fungi are strains 
of A. flavus-group fungi that do not produce aflatoxin, but have the 
capacity to occupy the same ecological niche in the field and out 
compete harmful toxin-producing fungi. The research has led to the well 
grounded optimism that solutions to this serious problem will be 
available by the beginning of the next century.
    The following list represents the projects in food safety funded by 
CSREES in the named program area within 1997 and 1998. The CSREES has 
not yet made any awards under the Food Safety Special Research Grants 
program and the National Research Initiative program in fiscal year 
1999.
          national research initiative awards fiscal year 1997
    The Role of Acid Resistance in Escherichia coli O157:H7 
Colonization and Disease, University of South Alabama, $227,000. 
Enterohemorrhagic E. coli (EHEC) cause a variety of dangerous 
gastrointestinal infections. EHEC Stereotype O157:H7 has recently 
emerged as an important foodborne pathogen that threatens many aspects 
of the food industry. A crucial feature of O157:H7 pathogenesis is its 
ability to withstand stomach acidity. Our laboratory has identified 
three systems of acid resistance present in all E. coli and a fourth 
system dedicated to O157:H7. Each system will protect cells to pH < 2.5 
for several hours. The University of South Alabama hypothesize that 
these acid resistance systems are induced during growth within 
livestock intestines and will persist over long periods of cold 
storage. One or more of these systems must contribute to the low 
infectious dose of O157:H7 by protecting E. coli from gastric acidity 
and intestinal weak acids. The University of Alabama's long terms goals 
are to develop new strategies that will diminish the infectious 
character of this pathogens through an understanding of the molecular 
basis of acid resistance in E. coli with emphasis on the superior acid 
resistance of O157:H7.
    Quantitative Viability Assays for Cryptosporidium parvum and 
Giardia lamblia, University of California-Davis, $44,000. 
Cryptosporidium parvum and Giardia lamblia are common waterborne agents 
whose potential for transmission via foods is increasingly being 
recognized. The objectives of this study are to develop quantitative 
viability assays for C. parvum and G. lamblia based on cell culture or 
in vitro culture and ELISA, and to evaluate the methods in trials of 
killing the protozoan oocysts or cysts by various means pertinent to 
food safety. Oocysts or cysts, respectively, will be inoculated into 
foods at risk of protozoan contamination (e.g., apple juice, shellfish, 
etc.); foods will be suspended in diluent as necessary, and the oocysts 
or cysts will be recovered by immunomagnetic capture. The oocysts or 
cysts will be treated to induce excystation, diluted serially, and 
inoculated into ELISA plate wells. Amplification of viable infectious 
agents will take place in the plate wells, during approximately 24 h at 
37. C. 0ocysts of C. parvum will be amplified in plate wells that 
contain monolayers of BSC-1 cells; whereas G. Iamblia cysts will 
probably be amplified in artificial medium in the wells. Homologous 
antibody will be added and labeled indirectly with horseradish 
peroxidase. The wells will be washed, a color reaction carried out, and 
results determined in a standard ELISA plate reader. Control inocula 
will include oocysts or cysts that have been inactivated by 
ultraviolet, formaldehyde, freezing, or heat. The tests will then be 
applied in inactivation trials with viable oocysts or cysts in foods of 
interest or in water that might be used in food processing.
    Molecular Stress Physiology of Listeria monocytogene, Illinois 
State University, $113,000. The bacterium Listeria monocytogenes is the 
causative agent of the foodborne disease listeriosis. The fatality rate 
of listeriosis is high and it is believed to be the leading cause of 
death from foodborne infections in the United States. Although Listeria 
can grow at the body temperature of an infected person, it has the 
unusual ability to also grow at refrigeration temperatures. 
Refrigeration can then in effect increase the Listeria content of a 
food. Illinois State University is interested in the underlying 
mechanisms involved that permit the bacterium to grow at low 
temperatures. Illinois State University will attempt to identify novel 
genes and proteins involved in growth at low temperatures. A fatty acid 
known as anteiso branched chain fatty acid appears to play a critical 
role in growth at low temperatures. Illinois State University will 
investigate the role of this fatty acid in maintaining membrane lipid 
fluidity at refrigeration temperatures. During food processing, 
bacteria can become injured and undetectable by conventional culturing 
methods, but not be dead. Illinois State University suspect that 
injured bacteria contain denatured proteins that must be degraded 
before the bacteria can grow, and will investigate this hypothesis. It 
is hoped that these studies will provide the scientific basis that will 
lead to novel methods of control of Listeria and improved methods of 
detection of the organism.
    Detoxification of Fumonisin by a Simple Fructose Reaction in Corn 
for Food, $110,000. The toxin, fumonisin B1, is found in corn 
everywhere. A suspected cancer-causing agent in humans, fumonisin B1 
requires its amine group, a simple nitrogen-containing portion of the 
molecule for its toxic action. Reacting this amine with simple sugars, 
such as fructose, is likely to block fumionisin toxicity, as the Iowa 
State University has previously demonstrated in a one-month model of 
liver cancer development in rats. Iowa State University's objectives 
are 1) to determine the toxicity of fructose-FB1 products in: a) a 
study of short-term toxic effects in pigs and b) a field-test feeding 
rats a fumonisin contaminated corn food that we have attempted to 
detoxify; and 2) to determine the processing conditions for the 
reactions of fructose and glucose with fumonisin to occur in corn-based 
foods. Objective 1) will be accomplished by feeding studies in pigs 
(for 2 weeks) and rats (for 4 months), comparing toxicity of pure 
fumonisin B1 with a fumonisin B1-fructose product and with corn 
contaminated with fumonisin and corn reacted to detoxify the fumonisin. 
Toxicity will be assessed by blood chemical changes and microscopic 
examination of tissues from the test animals. Objective 2) will 
determine the feasibility of performing this detoxification reaction in 
human foods, characterizing FB-reducing sugar reactions and the nature 
of the detoxification product(s), using a variety of chemical 
analytical techniques. These studies may provide a practical approach 
to the problem of natural toxins, increasing the safety of the food 
supply by detoxifying a natural toxin that occurs in corn everywhere.
    Salmonella enteritidis Heterophil Resistance, Iowa State 
University, $164,000. Egg-transmitted human salmonellosis is the most 
widespread food safety problem in the developed world. Over the past 
two decades, the number of Salmonella infections has increased 
dramatically in the United States, mostly due to Salmonella enteritidis 
var.enteritidis (SE) infections of eggs and egg products. The 
difficulty in controlling SE is primarily due to the low, but 
significant incidence of infected eggs. Iowa State University has 
isolated two less virulent SE mutants which are only briefly shed by 
infected birds, are effective in protecting birds against virulent 
challenge, and prevent egg transmission of virulent SE. Iowa State 
University propose to utilize these mutants to study the molecular 
basis of SE virulence and to identify genes involved in immune cell 
resistance so that safer vaccines can be developed. The following 
specific aims will be addressed: 1) Iowa State University will complete 
the assessment of the SE mutants in chickens in order to assess their 
pattern of colonization of infected tissues and affinity for egg laying 
tissues; 2) The genes involved in immune cell resistance will be 
identified by screening complemented strains in cell cultures; 3) 
Mutations will be constructed in these genes in the wild type strain in 
order to confirm their role in immune cell resistance; and 4) The 
mutants will be assessed for virulence and egg transmissibility in 
chickens. For unknown reasons, immune cell resistance is directly 
linked to lowered virulence in SE. These studies will shed light on the 
possible mechanisms involved and add to our understanding of Salmonella 
pathogenesis.
    Extracellular Sporulation Signals of Clostridium perfringens, 
University of Massachusetts, $148,000. Clostridium perfringens has 
established itself as a leading cause of human foodborne illness in the 
U.S. This organism produces heat resistant spores. An enterotoxin is 
produced by some strains during sporulation and therefore the sequence 
of events leading to spore formation are especially important. Yet 
virtually nothing is know about the early events of this process. The 
University of Massachusetts has identified a sporulation factor (C. 
perfringens sporulation fact [CPSF]) produced by both enterotoxin-
positive and enterotoxin-negative strains which stimulate the onset of 
sporulation and enterotoxin formation by this organism. The product(s) 
may be part of a signal transduction system. The signal transduction 
system in bacteria monitors the bacteria's environment and reacts to 
changes by chemical signals to the interior of cell. The University of 
Massachusetts will develop conditions to optimize the levels of this 
product then attempt to isolate and characterize it.
    Raw protein foods are commonly contaminated with both enterotoxin-
positive and enterotoxin-negative strains and the ability of 
enterotoxin-negative strains to stimulate sporulation and enterotoxin 
formation of co-cultured enterotoxin-positive strains will be 
determined in laboratory media and in a model food system. Such an 
ability by enterotoxin-negative strains could contribute to 
periodically-reported C. perfringens outbreaks having short incubation 
periods and may also identify a role for enterotoxin-negative strains 
in promoting sporulation and enterotoxin formation in the human 
intestine following ingestion of temperature-abused foods containing 
high levels of vegetative cells of both toxin types.
    Enhanced Green Fluorescent Protein Expression in Escherichia coli 
to Study Adherence to Meat, University of Massachusetts, $92,000. The 
United States Department of Agriculture, Food Safety Inspection Service 
(USDA/FSIS) recently enacted a regulation that requires that all meat 
and poultry processing plants develop a hazard analysis critical 
control points (HACCP) program. The aim of this regulation is to reduce 
the presence of infectious bacteria on the surface of meats, ground 
beef, and poultry products. There has been much research focusing upon 
methods for meat disinfection, even though there is little known about 
how bacterial stick to meat surfaces. This proposal will develop a 
microscopic experimental system that will investigate bacterial 
adhesion to meat surfaces. Knowledge of the interaction between 
bacteria and meat surfaces will lead to improved methods of detection 
and meat decontamination. This project will create E. coli strains that 
express enhanced fluorescent green protein (EGFP) and use these 
constructs to study bacterial adhesion and growth on meat surfaces by 
laser scanning confocal microscopy (LSCM). Both non-pathogenic E. 
coliand pathogenic strains will be constructed. This model system will 
allow experiments to be designed to determine the specificity of the 
adhesion and for analysis of the distribution of bacteria to meat 
structures. The scientific significance of this study is the novel 
system for investigation into the specific nature and parameters 
involved in bacterial adhesion to meat at a cellular level. The 
practical applications of this study will be the generation of basic 
knowledge that can be applied to evaluation of differential binding of 
pathogens (and indicator organisms) and the application of this 
knowledge to the wash steps during meat processing.
    Detection and Analysis of taphylococcus aureus Enterotoxin A in 
Food 7 Johns Hopkins University, $133,000. The goal of this project is 
to increase food safety by developing the next generation of detection 
and analysis methodology for bacterial toxins in food, using 
taphylococcus aureus enterotoxin A (SEA) as a model. The proposal aims 
to develop two technologies: a cell culture based assay of SEA activity 
and biosensor methodology for immediate automated detection of SEA in 
food. The two different approaches will complement each other since 
they address two sides of the same problem. Biosensor detection allows 
rapid detection of the toxin in food, while the cell culture 
methodology supplies the information on biological activity of the 
toxin. These two methods are expected to overcome the limitations of 
current immunological and animal-based tests for toxins in food. The 
cell culture based activity assay will be developed by exploiting the 
toxin's ability to stimulate division of lymphocytes. Biosensor 
technology represents a new approach to food safety analysis--real-time 
analysis. Biosensors can translate biological measurements into 
electronic signals enabling immediate analysis and automation. A novel 
methodology applying biosensor technology to food testing is proposed 
here. The aim of this project is to develop new testing methodologies 
which will aid food production and food regulation, and may increase 
food safety and quality.
    Intimin: Candidate for an Escherichia coli O157:H7 Anti-
Transmission Vaccine, Uniformed Services University of the Health 
Sciences, $232,456. Enterohemorrhagic Escherichia coli (EHEC) O157:H7 
is the most common infectious cause of bloody diarrhea in the U.S., and 
an occasional consequence of this infection, the hemolytic uremic 
syndrome, is the primary cause of acute kidney failure in U.S. 
children. Most U.S. cases of EHEC O157:H7 disease have occurred after 
ingestion of under cooked, contaminated hamburger. Cattle are reported 
to be asymptomatically and sporadically infected with this organism. 
EHEC have been shown to adhere to the intestinal epithelium of neonatal 
calves via a bacterial surface protein called intimin. The long-term 
goal of our project is to develop an inexpensive vaccine to prevent 
cattle from becoming infected with EHEC and, thus, prevent transmission 
from cattle to humans. To achieve this objective, the Uniformed 
Services University of the Health Sciences will i) evaluate whether 
intimin is required for EHEC O157:H7 colonization of older calves; ii) 
assess whether oral administration of anti-intimin antibodies 
interferes with intestinal colonization and lesion formation caused by 
EHEC O157:H7 in piglets, a surrogate for calves; iii) test whether 
pregnant pigs administered intimin by a non-oral route elicit anti-
intimin antibody responses in serum, colostrum, and milk and whether 
suckling piglets born of these immunized sows are protected from 
infection with E. coli O157:H7; iv) compare the antibody responses of 
mice to intimin and a set of intimin fragments administered by 
different routes and identify the smallest fragment that elicits 
antibodies capable of blocking EHEC adherence to epithelial cells; and 
v) develop a plant that expresses intimin or a fragment thereof as a 
potential edible vaccine for cattle.
    Survival and Virulence of Enterohemorrhagic Escherichia coli (EHEC) 
as Affected by pH and Water Activity, University of Maryland, $87,000. 
Enterohemorrhagic Escherichia coli (EHEC) have caused a series of 
foodborne outbreaks of bloody diarrhea as well as serious 
complications, including hemolytic uremic syndrome (HUS). While 
research efforts have been focused on E. coli O157:H7, it is becoming 
more evident that other serotypes of EHEC can also be associated with 
human diseases. An increasing number of non-O157 EHEC have been 
isolated from humans suffering from HUS and diarrhea. A variety of 
foods have been implicated in E. coli O157:H7 outbreaks, particularly 
foods of bovine origin. Certain foods such as apple cider and dry-cured 
salami that were considered safe and ready to eat, and are generally 
not heated before consumption have been identified as transmitting 
vehicle in E. coli O157:H7 outbreaks. Unlike O157:H7, most of non-O157 
EHEC serotypes have been isolated from sporadic cases, hence, the 
significance of food as vehicle for transmitting non-O157 EHEC is not 
clear. It has been shown that bacterial regulatory responses to 
environmental conditions are tied to virulence gene expression and that 
stressful signal in a hostile environment (e.g. acidic and/or dry 
conditions) can be utilized to induce/enhance virulence gene expression 
by pathogenic microorganisms. Foodborne pathogens having been exposed 
to such conditions may become more virulent. We propose to study: 1) 
Survival of EHEC strains (mainly non-O157:H7) as affected by pH and 
water activity; and 2) Virulence of EHEC strains as affected by pH and 
water activity.
    Symposia on Microbial Food Borne Hazards--Basic Research/Industry/
Regulatory Concerns, DHHS Food and Drug Administration; $6,000. The 
Food Microbiology Research Conference (FMRC) focuses on the 
presentation of basic/applied research by scientists within academia, 
government, and industry. The activities of the FMRC are governed by a 
set of bylaws, which were adapted as part of the process of gaining tax 
exempt status (private/nonprofit), thereby providing formal structure 
to the conference's financial management. FMRC meets every two years in 
the Chicago area, participation is by invitation, and the program 
format (panel discussion; individual seminars; symposia) is designed by 
an Executive Committee. The goal of the Conference is to advance 
knowledge and understanding in the area of food microbiology. FMRC 
meeting represent one of the few regularly held gatherings exclusively 
devoted to food microbiology. Industry/regulatory concerns are 
incorporated into the program for timely and relevant research topics. 
The XVI FMRC was held on 9-12 November 1997 at the Ramada Inn, O'Hare, 
Chicago. Confirmed symposia include: Molecular Approaches for Food 
Safety Assurance; Resistance-Control-Host Response to Bacterial 
Pathogens; Developments in Bacterial Inactivation and Reduced Consumer 
Risk; Roundtable panel on Zero Tolerance/Risk; and General Topics. 
Invited speakers and chosen symposia topics are designed to promote 
research/industry/regulatory interaction, thereby furthering the 
overall goal of enhancing food safety.
    Recombinant Antibodies to Natural Toxicants, Michigan State 
University, $116,000. There has been increased use by government 
agencies and the food industry of rapid antibody-based immunoassay in a 
first-tier screen for harmful toxins and microbial pathogens in foods. 
The antibodies used in these assays have been developed in animals such 
as rabbits or in tissue culture systems. Using recombinant DNA 
technology, it is now possible to engineer specific antibody reagents 
for improved food safety screening. The immediate advantages of 
recombinant antibodies are threefold. First, these antibodies can be 
genetically manipulated to improve sensitivity and greatly reduce assay 
time. Antibodies can also be designed that have specificity for groups 
or broad classes of toxicants or harmful microbes. Second, this 
approach will diminish the use of animals and animal products (e.g. 
fetal calf serum) for antibody production. Third, since recombinant 
antibodies will be produced in bacteria, the cost of the basic reagent 
will be as much as 10-fold less than that for animal or tissue culture 
systems. Thus, recombinant antibodies could be immediately useful in 
enhancing existing and new assays for toxins and microbes in foods. 
This proposal seeks to genetically engineer novel antibodies to an 
important group of natural toxins known as the Fusarium mycotoxins 
which commonly contaminate wheat, corn, rice and barley. Specifically, 
antibodies to fumonisin, vomitoxin and zearalenone will be prepared in 
bacteria and then these antibodies will be applied to testing for these 
harmful toxicants in food. From the perspective of food safety, the 
general approaches developed in this research will be amenable to 
improved detection of natural toxicants, chemical contaminants as well 
as bacterial pathogens and their toxins. Over the long term, cloned 
antibody sequences may find novel uses such as (1) immunization of food 
producing animals prevent toxic residues or pathogens in meats and 
poultry, (2) development of low cost procedures for removing toxicants 
from milk and dairy foods, and (3) expression in plants to neutralize 
toxicity.
    Adhesins for Colonization of Chickens and Their Use in Preventive 
of Salmonellosis, Washington State University, $156,000. The incidence 
of infection resulting from food borne pathogens continue to increase 
worldwide despite extensive research and changes at the production and 
processing levels. A 1996 CDC study indicated that Salmonella accounted 
for the majority of the bacterial foodborne disease outbreaks from 1988 
to 1992. Washington State University's long-term objective is to reduce 
or eliminate Salmonella colonization of poultry, which would in turn 
result in a reduction in the shedding of Salmonella in feces, its 
transmission to eggs, and the cross-contamination which occurs during 
processing. An understanding of the mechanism of Salmonella adherence 
to chicken cells could be particularly valuable when developing 
strategies to eliminate Salmonella contamination of poultry. Washington 
State University's preliminary data support the hypothesis that the 
Salmonella bacterium expresses gene(s) encoding an ``adhesin'' protein 
in response to high iron concentrations, and this adhesin is involved 
in binding the bacterial pathogen to a host cell. The goals of this 
proposal are (1) to identify the gene(s) encoding the iron-induced 
adhesin from Salmonella typhimurium, (2) to evaluate the role of the 
iron-induced adhesin in the adherence of the Salmonella to avian cells 
and (3) to determine if the iron-induced adhesin is made by other 
Salmonella species which colonize chickens. Washington State University 
will identify mutants unable to synthesize this adhesin and these will 
be evaluated using tissue culture and animal models. Ultimately, this 
information will be used to design methods to eliminate Salmonella in 
poultry either by contributing to the development of a live oral 
vaccine, or by identifying possible changes in the slaughtering 
procedure to reduce Salmonella cross-contamination.
    Incidence and Fate of Moniliformin in Corn and Heat Processed Corn 
Products, University of Nebraska, $97,000. Moniliformin is a highly 
toxic substance produced by Fusarium proliferatum and Fusarium 
sublutinans, molds commonly found on corn. Moniliformin has also been 
found in corn from different parts of the world, though the incidence 
and levels in corn and corn-based food products in the U.S. are not 
well documented. Considering the toxicity of moniliformin and the 
potential risk of chronic long-term consumption of it in corn-based 
foods, it is very important to know the extent of contamination and 
heat stability of moniliformin in corn and corn-based foods. The 
overall objective is to determine the incidence and levels of 
moniliformin in U.S. corn and corn-based foods, and the effects of 
heat, as applied in basic thermal processing of corn, on the stability 
of moniliformin. Specific objectives are to determine 1) the incidence 
and amounts of moniliformin in U.S. corn and corn-based foods; 2) the 
effect of heat on the stability of pure moniliformin in water at 
different temperatures, pH levels and heating times; and 3) the effect 
of selected thermal processes, including extrusion, alkaline processing 
(tortilla process) and baking on the stability of moniliformin in corn. 
To accomplish the objectives, corn and corn-based foods will be 
obtained from commercial food channels throughout the U.S. and analyzed 
for the presence and amounts of moniliformin. Heat stability of 
moniliformin in both water and corn substrates will also be studied. 
After heating in water or by the selected process, the presence and 
amount of moniliformin remaining will be determined by high performance 
liquid chromatography (HPLC).
    Modeling the Interactions of Pathogenic and Biocontrol Bacteria for 
Applications in Foods, USDA Agricultural Research Service, $86,000. The 
objective of this research is to develop a safe method for preventing 
the growth of pathogenic bacteria in minimally processed, refrigerated 
foods. A biocontrol strategy will be used which involves bacterial 
competition to accomplish this task. Lactic acid bacteria which are 
commonly used in various food fermentations (dairy, meat, vegetables) 
will be added as biocontrol agents to prevent the growth of pathogenic 
bacteria in minimally processed foods. If a food protected by this type 
of biocontrol strategy should spoil due to improper refrigeration or 
other reasons, the lactic acid bacterium should grow and competitively 
prevent the growth of potentially harmful bacteria. Although the food 
may not taste good because of the acid produced, the product would not 
be unsafe. The Agricultural Research Service has developed a 
mathematical model that predicts the outcome of the competitive growth 
of bacteria. The model may be useful in determining which lactic acid 
bacteria should be chosen as biocontrol agents, and how the growth of 
selected lactic acid bacteria will affect the growth of pathogenic or 
disease-causing bacteria. The Agricultural Research Service's research 
will involve growing both biocontrol and pathogenic bacteria, singly 
and in mixed culture, in vegetable broth and minimally processed 
vegetable products. Using the model to help interpret the data from 
these experiments, the Agricultural Research Service hope to gain 
insights into which factors such as growth rates, production of 
inhibitory compounds, or sensitivity of the cells to these inhibitors 
are most important to the predominance of one bacterial culture over 
another. While the Agricultural Research Service will primarily 
investigate biocontrol applications for refrigerated vegetable 
products, it is hoped that the principles learned in these studies can 
be applied to biocontrol applications for a variety of foods.
    Salmonella in Modern Swine Production Systems. Risk Factors for 
Fecal Shedding by Finished Pigs, North Carolina State University, 
$241,000. Control of foodborne disease is best achieved through 
appropriate actions in all sectors of the farm to table continuum. 
Salmonellosis is a major foodborne disease worldwide and Salmonella is 
the foodborne pathogen of greatest importance in modem swine 
production. Systems for producing swine have changed radically in 
recent years, in association with increases in average herd size. 
Knowledge of the epidemiology of Salmonella infections in modem swine 
production systems is minimal, but is necessary to identify appropriate 
measures to reduce the risk of foodborne disease to people and ensure 
access to international markets. Specific objectives of this project 
are to determine 1) risk factors for Salmonella prevalence in finishing 
pigs raised on slotted concrete floors in barns managed all-in/all-out, 
within multiple-site production systems; and 2) the relative importance 
of Salmonella infection in nurseries or the finishing environment as 
determinants of Salmonella infection in finishing hogs. Prevalence and 
serotypes of Salmonella will be determined by fecal cultures in 
finishing pigs, raised at specialist finishing sites. The sites chosen 
will be typical of modem systems that are predominantly and 
increasingly used for pork production in the USA. Feed and 
environmental samples will also be cultured. Data on management and 
environmental factors will be collected and examined for associations 
with Salmonella prevalence. The information obtained will be relevant 
to a large and increasing segment of the national swine industry, and 
will aid in defining the most efficient options for reducing Salmonella 
in the pork supply.
    Experimental Campylobacter Vaccine, University of Pennsylvania, 
$138,000. Campylobacter jejuni is a major cause of gastrointestinal 
infection in man and is the most common cause of sporadic diarrheal 
illness in the U.S. Campylobacter infection is primarily a foodborne 
disease with poultry being the single most important vehicle for 
transmitting the disease. A number of immunological approaches to 
reducing or eliminating Campylobacter from poultry are currently being 
investigated including the use of vaccines. The mechanism by which 
Campylobacter colonizes the chick GI tract is not completely understood 
but flagella are important colonization factors. The University of 
Pennsylvania expressed the full length Campylobacter flagellin gene, 
flaA, in an avirulent Salmonella typhimurium vaccine vector and tested 
several vaccine constructs in 4 day old chicks for immunogenicity and 
protection. During the past funding period, the University of 
Pennsylvania showed that these vaccines were highly immunogenic and 
induced anti-flagellin antibodies using a two-dose regimen. When 
animals were challenged 3 weeks after vaccination with the homologous 
strain of C. jejuni, vaccines conferred >95 percent homologous 
protection against cecal colonication. In the next funding period, the 
University of Pennsylvania will extend these studies to 1) assess the 
ability of these vaccines to confer cross-protection with different 
flaA types of C. jejuni, 2) determine the minimal amount of time needed 
post-immunization to confer protective immunity, 3) determine the 
minimal C. jejuni challenge dose in which complete protection occurs, 
4) determine whether the bivalent vaccine confers protection against 
Salmonella infection and 5) determine the smallest flagellin fragment 
that can elicit protective immunity. An immunogenic, broadly cross-
reactive vaccine, should be useful in improving the safety of poultry 
for human consumption.
    Food Pathogen Biosensors for Rapid Safety Measurements of Meat, 
University of Rhode Island; Food Optic and Biosensor Research Group, 
Kingston, RI, $96,205. Classical procedures for the detection of 
microbial pathogens in meats are slow and labor intensive. Rapid 
methods currently available are either complex, require potentially 
hazardous and expensive materials, or utilize a pre-enrichment step of 
18-24 hours to grow up enough cells for detection. This project will 
establish that biosensors; employing immobilized antibodies specific 
for meat pathogens can be successfully utilized for biomonitoring of 
contamination in food products. One approach will utilize fiber optics 
to analyze the optical excitation and emission properties of 
immobilized antibodies and attached pathogens on the surfaces of gold 
coated silicon. The second biosensor will continue to explore the 
potential of the Quartz Crystal Microbalance with reusable 
piezoelectric quartz crystals containing attached antibodies. The 
maximum response of these biosensors for determination of microbial 
cell concentrations of pathogens in meat products will be established. 
Consumer demand for fresh and less processed food, such as meat, makes 
the need to ensure microbial safety of products very clear. This 
project provides the opportunity for a multidisciplinary effort to 
create specific biosensors for rapid and early detection of pathogen 
contamination in meat. These devices have the potential for 
specifically selecting food pathogens from among the total microbial 
load within minutes and measuring the concentration as real-time 
analysis on site. The capability for miniaturization and portability 
emphasizes the possibilities that this new technology will provide the 
tools for effective monitoring programs. The ability for rapid early 
detection of pathogens will enhance the safety and quality of U.S. meat 
products.
    Salmonella typhimurium Genes Required for Systemic Infection of 
Cattle, Texas A&M University, $90,000. Salmonellosis is the most 
frequent food-borne illness in the U.S. and is usually contracted by 
consumption of meat and dairy products from infected livestock. Little 
is known about genes allowing Salmonella typhimurium to cause systemic 
infection in cattle, an important meat source in the U.S. Since 
systemic infection can lead to a chronic carrier state, information 
about the mechanisms used by S.typhimurium to establish systemic 
infection is relevant to development of strategies to eliminate this 
pathogen from cattle. The goals of this project are the identification 
and characterization of bacterial genes which enable S. typhimurium to 
cause systemic infection in cattle. The role that these genes play 
during infection will be examined by determining the ability of 
attenuated bacterial mutants to spread to different organs in cattle. 
Finally, by determining whether the same set of virulence genes 
identified in cattle is also required for infection of the mouse, the 
university will determine whether any of the genes identified in this 
study are host-specific adaptations to causing disease in cattle. The 
results of this research will help to develop strategies for reducing 
the number of carrier animals from cattle herds as well as for the 
detection of Salmonella in meat and dairy products, thereby increasing 
food safety.
    Fumonisins: Immunology, Genetics and Enzymology, University of 
Wisconsin, $129,897. Fumonisins (Fms) are a group of mycotoxins 
produced primarily by the fungus Fusarium moniliforme, FmB1, the major 
mycotoxin in this group is a weak carcinogen and induces apoptosis both 
in animals and plants. It also is responsible for leukoencephalomalacia 
in horses and for swine edema syndrome/swine mystery disease. Because 
of the widespread occurrence of this group of mycotoxins in corn and 
related foods and their carcinogenicity and potent cancer promoting 
activity, this group of mycotoxins is potentially hazardous to human 
and animal health. Using mutant cultures and a combination of 
immunochemical and chemical methods, the University plan to identify 
the major steps, intermediates and enzymes involved in the biosynthesis 
of Fm. The methodology developed in the proposed work could be used for 
further studies of the conditions conducive to the formation of Fms in 
the field and during storage. Different tools and mutants developed 
from the present study will be shared with other scientists for related 
studies. This study is a critical step in the development of methods to 
control Fm formation.
          national research initiative awards fiscal year 1998
    Rapid Detection of Brevetoxin and Ciguatoxin Using Recombinant Na+ 
Channels, University of South Alabama College of Medicine, $90,000. 
Contamination of shellfish by a marine toxin known as brevetoxin 
periodically threatens the health and safety of seafood consumers. 
Brevetoxin poisoning typically causes neurological and gastrointestinal 
disturbances that last 3 to 4 days but fatalities have been reported in 
severe cases. There are not any known antedotes for poisoning and, 
consequently, toxin levels must be rigorously monitored to prevent 
ingestion of tainted seafoods. This proposal will develop rapid and 
sensitive methods to test for brevetoxin and ensure seafood product 
safety.
    Role of Putative Pathogenicity Island in Campylobacter jejuni 
Virulence, University of Arizona, $190,000. Incidence of 
campylobacteriosis in man has risen dramatically in the past 10 years 
and passed salmonellosis as the number one disease acquired by 
consuming contaminated food products. It is estimated that 
Campylobacter jejuni causes 3 million cases per year with a cost due to 
treatment and loss of productivity greater than one billion dollars. 
Clearly, understanding mechanisms by which this major pathogen causes 
disease is invaluable. Nevertheless, few factors associated with C. 
jejuni virulence have been identified. Progress in this important 
research area has been hampered by the lack of genetic tools to examine 
or identify virulence factors. To date, roughly ninety C. jejuni genes 
have been characterized, and only six of which are related to 
virulence. Recently, the University has isolated an iron uptake system 
encoded within a putative pathogenicity island from virulent C. jejuni. 
Genes within this island may be influential in defining the 
pathogenicity of the agent that will lead to control measures for 
decreasing the incidence of campylobacteriosis. The long range goal of 
the proposed research is to evaluate genes contained within a putative 
pathogenicity island in C. jejuni for their role in virulence. Sequence 
analysis reveals an area that encodes two disparate physiologic 
functions, an iron uptake system, and a cell wall biosynthetic pathway 
suggesting that maintenance of this unique island may not be due to 
environmental iron limitations alone. The island may encode other 
functions and comprise not only an iron uptake island, but a 
pathogenicity island. Consistent with these observations we hypothesize 
that this locus comprises a pathogenicity island which contributes to 
C. jejuni virulence.
    Strategies to Eliminate and Prevent Microbial Contamination of Food 
Products, University of Arkansas for Medical Science; College of 
Pharmacy; Food Safety Group, Little Rock, AR, $70,000. While the 
American food supply is considered among the safest in the world, 
recent estimates suggest that as many as 9,000 deaths and 6.5 to 33 
million illnesses in the United States each year are food-related, and 
with medical costs and productivity losses ranging between $1.8 billion 
and $4.8 billion annually. The need to develop strategies to eliminate 
and prevent microbial contamination of food products is highlighted by 
factors such as emerging foodborne pathogens and pathogenic strains, 
new and more frequent outbreaks of foodborne disease, and the increased 
susceptibility to foodborne infections of population groups with 
lowered immunity. Previous research in our laboratory indicated that 
cetylpyridinium chloride (CPC), a chemical safely used for over 30 
years in oral hygiene products, was able to reduce Salmonella and other 
bacterial contamination from poultry tissues. CPC was also effective in 
preventing bacterial attachment, and has potential to reduce the risk 
of cross-contamination. The ultimate goal of the research in this 
proposal is to develop effective methods to control, eliminate and 
prevent microbial contamination of food products. The specific aims of 
this project are: 1) to determine the effectiveness of CPC for 
decontamination of fresh fruits and vegetables; and 2) to assess the 
organ.
    Bacteria for Competitive Exclusion of Salmonella enteric Species in 
Chickens, University of Delaware, $185,000. The community of bacteria 
inhabiting the intestinal tract can prevent or impede the establishment 
of undesirable bacteria such as Salmonella enterica subspecies. Newly 
hatched chicks lack an intestinal bacterial community. Exposure to 
intestinal bacteria from adult chickens potentially heightens the 
resistance of young birds to infection with Salmonella. Such bacterial 
preparations can therefore contribute to increased microbial food 
safety of poultry products by reducing the number of chickens in a 
flock that carry Salmonella into the processing plant. The optimal 
composition of an effective bacterial preparation is currently not 
known. The goal of the proposed research is to identify and isolate 
bacteria from the intestinal tract of chickens and to eventually test 
their effectiveness in reducing colonization of young chicks with 
Salmonella. The research will focus on the bacteria that are associated 
with the inner surface of one of the chickens intestinal organs, the 
cecum. Since a considerable fraction of intestinal bacteria has been 
refractory to isolation in pure culture, the bacteria will initially be 
identified without culturing using genetic means. Identification will 
be achieved by sequencing of 16S rRNA genes amplified from total DNA 
extracted from the cecal bacterial community. Denaturing gradient gel 
electrophoresis of amplified DNA and in-situ hybridization with 
specific probes will provide information on the diversity, location and 
prevalence of bacteria within the ceca. Once the identity of the cecal 
bacteria is known, culture conditions for their isolation can be 
designed and their value in prevention of Salmonella carriage in 
chickens can be assessed.
    Fluorescence-Based Chemical Sensor for Saxitoxin, University of 
Miami, $95,000. Saxitoxin is the primary constituent of the so-called 
paralytic shellfish poisons (PSPs). Currently, contamination of 
shellfish beds by PSPs is monitored by mouse bioassay. Recently, the 
University of Miami has discovered a molecular receptor that 
``signals'' the presence of saxitoxin in solution by emitting light 
(technically known as enhanced fluorescence emission). This type of 
phenomenon is of considerable interest to the chemical community in 
general, but regarding saxitoxin, it could be the key to developing a 
photochemical sensor that would complement mouse bioassay. The first 
stage of this development, funded by this project, is to study the 
details of the ``recognition'' and emission phenomenon between 
saxitoxin and its receptor, both in solution and at a surface (the air-
water interface). The University of Miami will begin by examining the 
fluorescence emissions quantitatively, then modifying the receptor to 
optimize its binding and signaling properties. The University will 
modify the receptor to make it amenable to incorporation into a 
monolayer that, when spread over the surface of water, can be studied 
in a similar fashion. Studying the phenomenon in a monolayer is a 
prerequisite to development of a sensor using fiber optics.
    Defining Genomic Sequences Specific to Virulent Vibrio vulnificus 
Strains to Assess Risk, University of Florida, $90,000. Vibrio 
vulnificus is the leading cause of reported human death in the U.S. 
caused by the consumption of seafoods. Since its discovery, V. 
vulnificus has had a significant impact on public health policy, food 
regulations, and industry practices. Currently, there is no practical 
test to determine if seafood products contain hazardous strains of V. 
vulnificus. The University propose to solve this problem by defining 
DNA sequences specific to virulent strains, and then developing simple 
DNA probe test(s) that can be used by industry and public health 
organizations to assess risk. The University will use two techniques to 
identify segments of DNA that are unique to virulent strains, 1) by 
``subtracting'' DNA of non-virulent strains from virulent strains, 
thereby identifying virulent specific DNA sequences, and 2) by allowing 
the mouse model to directly select for strains that have acquired DNA 
sequences from virulent V. vulnificus strains that are randomly cloned 
into non-virulent strains. These approaches will produce virulence-
specific gene probe(s) that can be widely used to assess V. vulnificus 
hazards in seafood products. The University anticipate that this 
information will be integrated in ongoing CDC-FDA-State efforts to 
determine the epidemiology of V. vulnificus infections and to develop 
effective interventions to reduce risk of V. vulnificus disease.
    Regulation of Lipopolysaccharide Micro Heterogeneity, USDA 
Agricultural Research Service; Southeast Poultry Research Laboratory, 
Athens, GA, $125,000. Bacteria that contaminate food are genetically 
capable of altering their growth properties and cell surface properties 
in order to infect susceptible people or animals. One foodborne 
bacterium that is especially capable of contaminating the contents of 
eggs is Salmonella enterica serovar Enteritidis (SE). It has been shown 
that certain strains of SE enter an accelerated phase of growth when 
environmental conditions provide appropriate signals to the bacterial 
cell. During enhanced growth, many of the cell surface features of SE 
alter drastically which contribute collectively to an enhanced ability 
of the bacteria to grow to high numbers in organs, as measured by 
increased recovery from the organs of chicks, mice, and eggs. The most 
prominent molecule composing the outer membrane of SE is 
lipopolysaccharide (LPS). Previous research indicated that changes in 
LPS structure can be used to detect strains that are more capable of 
attaining full virulence. Current research to be conducted under this 
grant is directed towards understanding the genetic changes that result 
in strain variation, as measured by the ability of strains to generate 
particular LPS structures while maintaining accelerated growth. This 
work is important because it will lead to a better understanding of 
environmental conditions that favor outgrowth of new strains of SE. 
Since certain LPS structures alter the production of proteins on the 
cell surface, this research should also contribute to a more complete 
understanding of the immunological properties of virulent SE and to the 
development of improved vaccines.
    Mechanism for Inactivation of Microorganisms by High Oxidation 
Potential Water, University of Georgia, $120,000. Reported cases of 
outbreak of food-related illnesses as well as severity of infection and 
cost of treatment are on the increase. An estimated 6.5 to 33 million 
people are infested annually in the U.S., out of which 9,000 die. The 
high oxidation potential (HOP) water has been reported by scientists in 
Japan to have strong bactericidal effect on most pathogenic bacteria. A 
major advantage of HOP water is that no chemical except water (with 
very dilute NaC1) is used. Therefore it has less adverse impact on the 
environment. Also, the treated food is not exposed to heat treatment 
and will experience minimal change in quality. The overall objective of 
this project is to study the fundamental principles involved in the 
inactivation of food microorganisms with HOP water. HOP water with 
different properties will be used to treat five strains each of three 
pathogenic bacteria (Bacillus cereus, Listeria monocytogenes and 
Escherichia coli O157:H7). The HOP water with the most effective 
combination of properties will then be used to evaluate the effect of 
different organic materials in food systems on its antimicrobial 
effect. Bacteria inactivation on food surfaces with HOP water will be 
evaluated using inoculated food samples. The application of this 
technology will ensure food safety at reduced cost, high food quality 
and reduced danger from foodborne illness.
    Screening Corn for Resistance to Aspergillus flavus and Aflatoxin 
Accumulation, Southern Illinois University, $100,000. Two traits in 
corn genotypes will be used to identify potential resistance sources: 
1) sporulation by Aspergillus flavus on intact or endosperm-wounded 
kernels, and 2) accumulation of norsolorinic acid (NOR) in kernels 
inoculated with A. parasiticus isolate SKI. NOR is an orange-pigmented 
intermediate in the aflatoxin biosynthesis pathway. Genotypes that 
exhibit minimal sporulation and accumulation of orange pigment will be 
tested for aflatoxin resistance in controlled laboratory inoculations. 
Genotypes from this pool that prove to be resistant will be evaluated 
for resistance in field trials. Those that show resistance will be 
examined for mechanism of resistance. Surface wax will be removed from 
intact kernels of these resistant genotypes, as well as standard 
susceptibles, and weighed. Resistant genotypes with large amounts of 
wax will demonstrate that wax acts as a physical barrier to infection 
by A. flavus. Wax removed from kernels will be bioassayed for 
antifungal activity against A. flavus. Resistant genotypes with 
antifungal properties will demonstrate that wax acts as a physiological 
barrier to infection by A. flavus. Protein profiles determine whether 
proteins unique to, or in greater concentration in, resistant genotypes 
are involved in resistance to A. flavus.
    Listeria monocytogenes: Ozone Inactivation, University of Illinois, 
$95,000. The objectives of this study are to examine the effects of 
ozone (03) on the pathogen Listeria monocytogenes. Ozone is one of the 
most powerful oxidizing agents (52 percent stronger than chlorine) and 
is effective against a broad spectrum of microorganisms, including 
viruses, bacteria, yeast and molds. Ozone has recently been recommended 
for approval as Generally Recognized As Safe (GRAS) in food production. 
Little or no research has been performed on the influence that ozone 
has on the destruction of L. monocytogenes. This proposal will 
determine important parameters of ozone-induced injury and death of L. 
monocytogenes. The optimal conditions of ozone exposure for listerial 
death will be determined. Initial variables will include time, 
temperature and ozone concentration. Injury and death will be 
determined using a dual plating procedure, and by the release of 
subcellular components. The thermodynamics of ozone inactivation will 
be determined. Any differences in the phase of growth on the 
susceptibility of L. monocytogenes to ozone will be examined. Recovery 
of ozone-injured listerial cells will be studied, as will be the 
site(s) of ozone damage. The influence of ozone in reducing listerial 
counts in a food product (cabbage) will also be determined. The 
influence of ozone on the enzymes catalase and superoxide dismutase in 
L. monocytogenes will be examined immediately following exposure and 
during recovery.
    Persistence of Salmonella typhimutium in Swine, University of 
Illinois, $240,000. . typhimurium is one of the major causes of 
salmonellosis in humans. Pigs persistently infected with S, typhimurium 
are one of the major reservoir of this pathogen. Generally, pigs 
persistently infected with . typhimurium are asymptomatic. One means to 
reduce the risk of foodborne infections caused by . typhimurium is to 
prevent pigs from becoming persistently infected. This project is 
designed to understand the mechanisms promoting persistent infections. 
The initiation of infection requires the attachment of S. typhimurium 
to the lining of the small intestine. There are two types of cells in 
the small intestine that are targets for attachment: 1) epithelial 
cells call enterocytes and 2) epithelial cells call M-cells. The 
University's current hypothesis, which is based on our previous 
experiments using mutant . typhimurium that do not attach to 
enterocytes, is a attachment to enterocytes which is important for the 
development of persistent infections while attachment to M-cells 
results in disease. The goals of this study are to confirm that our 
non-adhesive mutants indeed do not attach to enterocytes in pigs but 
retain the ability to attach to M-cells. Furthermore, the University 
have found that a novel mechanism allows . typhimurium to sense its 
location in the intestine and turn on a set of genes that promote its 
ability to colonize enterocytes and this results in persistent 
infections. The University plans to create additional mutants that no 
longer can control these genes and determine whether the mutants have 
lost the ability to cause persistent infections.
    Analysis of the Osmotic Regulation of Thermotolerance in Salmonella 
and E. coli O157:H7, Purdue University, $185,000. The addition of 
moderate or high concentrations of salts or sugars can enhance the high 
temperature tolerance of food pathogenic bacteria such as Salmonella 
and E. coli O157:H7. This enhanced thermotolerance is manifested both 
as increased growth rate at non-lethal high temperatures and increased 
survival at otherwise lethal high temperatures. These observations 
indicate that the addition of salts or sugars to food products as 
preservatives or flavor components can compromise the efficacy of high 
temperature treatment for the inactivation of contaminant organisms. 
The University found that betaine, which is found at high levels in 
edible plants such as spinach and cereal grains, block the ability of 
salt additives to increase the thermotolerance of bacteria. Part of the 
research project will be to carry out a comprehensive characterization 
of all available structural relatives of betaine for their ability to 
counteract the induction of increased thetmotolerance by salt additives 
in food pathogenic bacteria. This procedure may uncover new food 
additives that might be used to increase the efficacy of thermal 
inactivation in food contaminating bacteria. A second component of the 
project will be to discover genes which are involved in the induction 
of increased heat tolerance by salt. The understanding of the 
mechanistic connection between high salinity and increased 
thermotolerance has the potential application that it might lead to the 
design of new antimicrobial compound that could lead to decreased 
survival of food pathogens during thermal processing.
    Molecular Biology of Aflatoxin Biosynthesis in Aspergillus flavus, 
Purdue University, $160,000. Aflatoxins produced by the fungus 
Aspergillus flavus, are toxic and carcinogenic compounds contaminating 
a variety of food products. In addition to the significant health risks 
associated with aflatoxins, there is also an economic burden. Millions 
of dollars are spent each year to test potentially affected food, 
including corn, peanuts, figs, tree nuts and milk. Aflatoxins are 
products of fungal secondary metabolism. The genes involved in the 
biosynthesis of aflatoxin are grouped together in a single cluster. The 
cluster contains at least 18 genes that code for the pathway enzymes 
and for regulation of aflatoxin biosynthesis. This research project 
will investigate an unusual mutation in A. flavus. Strain 649 has a DNA 
deletion at the afl-1 locus that includes the entire cluster of 
aflatoxin biosynthesis genes. Diploids formed by crosses between strain 
649 and aflatoxin-producing strains do not produce aflatoxin. The goal 
of the research is to determine the mechanism responsible for this 
suppression of aflatoxin biosynthesis. The specific objectives are to 
isolate and characterize the DNA at the deletion break-junction region 
in strain 649, and to determine the involvement of the regulatory gene 
aflR in repression of aflatoxin biosynthesis. This research will impact 
agriculture by furthering our understanding about the regulation of 
aflatoxin biosynthesis and contribute information leading to 
development of new strategies for eliminating aflatoxin contamination.
    Modeling Food Fluctuating Microbial Populations and Their Aperiodic 
Outbursts, University of Massachusetts, $90,000. The total number of 
microorganisms, or of specific types, which are encountered in raw beef 
or dairy products for example tend to fluctuate. Usually such daily or 
hourly fluctuations are within a specified range and hence raise little 
or no safety concern. Only occasionally, and in some cases without an 
apparent cause the numbers encountered are unusually high and may be 
considered a safety problem. The University of Massachusetts plans to 
analyze the fluctuations pattern, and by mathematical models and 
statistical methods, to estimate the probability of the occurrence of 
such an outburst. In other words, the University of Massachusetts 
propose to convert the apparently random sequence of counts into a set 
of probabilities of encountering outbreaks of a magnitude of safety 
concern. These calculated probabilities can then be used as indication 
of an impending microbial outbreak, and as a tool to assess 
quantitatively the efficacy of preventive methods in reducing the risk.
    Genomic Analysis of Escherichia coli O157:H7 Populations from 
Cattle and Humans, University of Nebraska, $150,000. Genetic 
fingerprinting of E. coli O157:H7 strains from cattle herds indicates 
that certain strains can be repeatedly isolated from a given herd over 
time (persistent population) despite the fact that other genetically 
distinct E. coliO157:H7 strains may be introduced into the herd but are 
unable to displace the persistent population. These results suggest 
that persistent strains are better able to survive and/or propagate in 
these environments. Are there particular herd management practices that 
have selected for these persistent populations and are these strains 
genetically distinct from those isolated from infected humans? The 
University of Massachusetts has developed a powerful technique, termed 
high-resolution genotyping (HRGT), that permits identification of even 
minor genetic differences between different E. coli O157:H7 strains. 
This procedure will be used to develop a database for rigorous 
assessment of the genetic relatedness of persistent and non-persistent 
and non-persistent isolates will be examined in further detail (full 
genome coverage) by HRGT to identify genetic differences that may be 
related to persistence. The genes that are marked by these differences 
will then be examined to begin assessing how their function may 
contribute to persistence and whether particular herd management 
practices may have played a role in selecting for alterations in these 
genes. Ultimately these results may provide a rational basis for 
understanding the impact of herd management practices on the population 
structure of this organism.
    Antimicrobial Use and Emerging Resistance of Salmonella typhimurium 
in Dairy Cattle, Cornell University, $120,000. Antibiotic-resistant 
Salmonella infections in human are an increasing public health problem. 
The use of antibiotics in food producing animals for disease prevention 
or treatment and to enhance growth potentially selects for resistant 
Salmonella strains which may be transmitted to humans. Livestock 
investigations are needed to identify practices associated with the 
emergence of Salmonella resistant to antibiotics currently important in 
human medicine.
    This project will investigate the effect of antibiotic treatment of 
clinical salmonellosis in dairy cattle on the occurrence of antibiotic-
resistant Salmonella typhimurium, a major animal and human pathogen. 
This will be done by identifying dairy herds with Salmonella 
typhimurium-infected cattle based on diagnostic laboratory culture 
results, obtaining antibiotic treatment information from farm records 
and collecting fecal samples from cattle on the farm for Salmonella 
isolation and determination or resistance patterns. The association 
between cattle from the same herd will be analyzed. The characteristics 
of study farms will be typical of large segment of the U.S. dairy 
industry.
    The study results will provide valuable information on the 
emergence of antibiotic-resistant Salmonella typhimurium and specific 
drug-use practices which are associated with resistance. This will 
allow implementation of changes on farms designed to reduce the 
development of antibiotic-resistant bacteria and thereby decrease 
foodborne or direct transmission of resistant strains from dairy cattle 
to people. The project will also contribute data needed for policy 
decisions by regulatory agencies related to antibiotic use in food 
producing animals.
    Identification of Human Enteric Viruses in Foods and Fooborne 
Disease Outbreaks, North Carolina State University, $140, 000. Enteric 
viruses are significant human pathogens, recently ranked fifth and 
sixth amongst identified causes of foodborne disease in the U.S. While 
these agents are responsible for diseases such as gastroenteritis and 
hepatitis, the true scope and significance of foodborne viral infection 
is drastically underestimated due to inadequacies in reporting and 
detection methods. The introduction of molecular biological techniques 
offers sensitive and specific alternatives for the detection of these 
previously non-detectable viral agents. The purpose of this research is 
to refine molecular methods to detect human enteric viruses from foods 
and to further develop approaches for the investigation of outbreaks of 
foodborne viral disease. The specific objectives are as follows: (1) 
Refine methods to extract human enteric viruses from foods, (2) Improve 
sensitivity, specificity, and speed of virus detection and 
confirmation, (3) Develop methods specifically for the detection and 
identification of small-round structured viruses of epidemiological 
significance to humans, and (4) Develop a comprehensive approach to the 
investigation of outbreaks of foodborne viral disease by linking 
detection and identification in clinical (fecal) and food specimens. 
The successful completion of this project will provide rapid and 
economical methods for the detection of viral contamination of foods 
and the investigation of foodborne viral disease outbreaks. These 
benefits will ultimately improve the safety of food products, protect 
public health, and minimize financial losses due to viral contamination 
of foods.
    Stress-Induced Resistance to High Pressure in Listeria 
monocytogenes and Escherichia coli O157:H7, Ohio State University, 
$90,000. High pressure processing is a novel, non-thermal technique for 
inactivating pathogens in food by the application of extremely high 
pressures. Application of pressures in the range of 5000-9000 
atmospheres for 1-5 minutes, at room temperature, can significantly 
reduce the microbial population in food and dramatically extend its 
shelf life. Since heat is not used in the process, negligible flavor 
and nutrient changes occur as a result of the high pressure treatment.
    During the past two decades, new food-transmitted diseases emerged 
such as those caused by the enterohemorrhagic E. coli and the 
meningitis-causing Listeria. Such pathogenic bacteria are more likely 
to survive during food processing if they were exposed to conditions 
that make them resistant to preservation methods. For example, bacteria 
that are normally sensitive to heat may become heat-resistant when they 
are stressed during production, harvesting or even mild processing of 
food. Therefore, adaptation of bacteria to various stresses may 
compromise the safety of food.
    This challenge to the food industry needs urgent attention when new 
processing technologies (such high pressure processing) are introduced. 
This project will identify the potential causes for increased 
resistance of pathogens to pressure. Additionally, the study will 
assess, in quantitative terms, the relationship between stress that 
foodborne pathogens may encounter and resulting stress-induced 
resistance to high-pressure processing. The outcome of this project 
will help food manufacturers develop strategies to overcome and 
eliminate stress-adaptation in foodborne pathogens.
    The Molecular Epidemiology of Clostridium perfringens Type A Food 
Poisoning, University of Pittsburgh School of Medicine, $160,000. 
Clostridium perfringens type A food poisoning currently ranks as the 
second most common foodborne disease in the U.S. The diarrhetic and 
cramping symptoms of this illness are caused by C perftingens 
enterotoxin (CPE). Recent studies have shown that the CPE gene encoding 
this enterotoxin can be located on either chromosomal or 
extrachromosomal DNA. However, only C. perfringens isolates carrying an 
extrachromosomal CPE can cause non-foodborne intestinal disease. This 
project will evaluate four possible explanations for the strong 
association between chromosomal CPE isolates and food poisoning: i) 
isolates carrying a chromosomal CPE are predominant in the food 
poisoning environment, ii) chromosomal CPE isolates are more resistant 
to food-associated stresses (e.g. cooking) than are isolates carrying 
an extrachromosomal CPE, iii) the chromosomal CPE is more stable to 
food-related stress than the extrachromosomal CPE, and iv) food-related 
stress induces migration of the extrachromosomal CPE onto the 
chromosome. These studies should improve the safety of the American 
food supply by distinguishing whether only chromosomal CPE isolates are 
able to cause food poisoning, or if isolates carrying an 
extrachromosomal CPE can be converted, by food-related stress, into 
chromosomal CPE isolates. This information will improve the safety of 
the American Food supply in two ways: 1) it will become possible to 
specifically detect the presence of C. perfiringens food poisoning 
isolates in foods before these foods are consumed, and 2) it will 
elucidate how/when C.perftingens food poisoning isolates enter foods, 
which will allow the development of strategies to interfere with the 
introduction of C. perftingens food poisoning isolates into foods.
    Inactivation of Foodborne Pathogens Exposed to a Uniform Glow 
Discharge Plasma, University of Tennessee, $71,442. Increased emphasis 
on food safety has intensified research efforts to develop and evaluate 
new and innovative means of inhibiting, destroying, and controlling 
pathogenic microorganisms in foods. The overall objective of this 
research is to evaluate the efficacy of a One Atmosphere Uniform Glow 
Discharge Plasma (OAUGDP) for its ability to destroy foodborne 
pathogens. The OAUGDP is a newly-invented form of electron discharge 
which generates a uniform glow discharge plasma (plasma--the fourth 
state of matter) in atmospheres of various gases such as helium, carbon 
dioxide, and most importantly air. The sterilization properties of the 
OAUGDP include ozone and other oxidative species, ultraviolet photons, 
photons in the visible part of the spectrum, charged particles, and 
neutral particles. Specific objectives of our proposed work are 1) to 
determine the susceptibility of ten foodborne pathogenic microorganisms 
to inactivation upon exposure to the OAUGDP, and 2) to determine the 
effect of culture age, pH, and growth temperature on the susceptibility 
of these foodborne pathogens to inactivation. The University of 
Tennessee's previous studies have shown that the OAUGDP is an effective 
means of destroying various microorganisms. Furthermore, the 
University's results indicate that treatment of culture media with the 
OAUGDP for the times required to kill bacteria does not result in the 
development of by-products toxic to microbial growth. The OAUGDP unit 
has the potential to be adapted as an in-line process suitable for 
application as a mechanism of pasteurizing foods and controlling 
foodborne pathogens.
    Sporulation Control of Enterotoxin Synthesis in Clostridium 
perfringens, University of Tennessee, $130,000. Clostridium perfringens 
is a common source of food poisoning in humans, and it is responsible 
for 10 percent of the outbreaks in the U.S. Most large outbreaks of C. 
perfringens food poisoning are associated with commercial food 
services, such as restaurants and institutions, but many infections 
occur in the home as well. The symptoms of the disease (diarrhea, 
nausea and vomiting) are due to the production of a potent enterotoxin 
protein (CPE) in the intestinal tract by sporulating bacteria. The 
ability of C. perfiringens to produce a heat resistant spore not only 
leads directly to the production of the enterotoxin, but also leads to 
increased outbreaks of the disease. Often foods are prepared at high 
enough temperatures to kill vegetative cells, but not spores. If the 
food is not refrigerated, the spores germinate and the cells grow 
rapidly. When the contaminated food is eaten, the cells sporulate in 
the small intestine, releasing the enterotoxin. The University is 
interested in determining how the sporulation process regulates cpe 
gene expression at the transcriptional level. To study this, the 
University will take two experimental approaches: (1) Purify RNA 
polymerase enzymes that transcribe cpe gene promoters, and (2) 
Determine in which cell compartment of the developing spore 
transcription factors needed for cpe gene expression are made. 
Together, these studies will contribute to our knowledge of how heat 
resistant spores and enterotoxin are produced by the cell. This 
information can then be used to develop better food handling procedures 
to reduce the incidence of this very common disease.
    Novel Antimicrobial Systems for Control of Foodborne Pathogens, 
University of Wisconsin, $90,000. The microbiological safety of 
imported and domestic fruits, vegetables, and certain other foods has 
become a major priority of the USDA, FDA, and HHS. Recent studies from 
our laboratory have demonstrated that certain food-approved flavorants 
markedly sensitize foodborne pathogens including Escherichia coli 
O157:H7, Listeria monocytogenes and Staphylococcus aureus to various 
classes of food-grade antimicrobials and to certain antibodies. In 
particular, in the presence of low concentrations (<100 ppm) of the 
flavorants nerolidol and farnesol, microorganisms are inhibited by 
markedly lower doses of certain antimicrobial agents and antibiotics. 
These compounds are derived from natural plant sources. The 
University's results indicate that these and related compounds could be 
used to increase the efficacy of other food-grade antimicrobial agents. 
In the present study, sensitization by terpenoids and inactivation of 
foodborne pathogens will be investigated. Gram-negative and gram-
positive bacterial pathogens will be exposed to potential sensitizing 
agents, and then evaluated for extent and kinetics of inactivation by 
sanitizers, food-grade antimicrobials and antibiotics. Killing will be 
assayed by traditional plating, and by flow cytometry. Organisms to be 
tested include strains of E. coli O157:H7, Salmonella serovars Listeria 
monocytogenes and Clostridium botulinum. The successful completion of 
this proposal will provide novel elimination and sanitation 
technologies to reduce the risk of foodborne disease from foods and 
food contact surfaces and will enhance the public and media image 
regarding the microbiological safety of raw and minimally processed 
foods.
    DNA-Binding Proteins CspE and Dps Protect DNA at Low pH in 
Escherichia coli O157:H7, University of Wisconsin, $115,000. An 
important characteristic of Escherichia coli O157:H7 is the ability of 
10 to 100 O157:H7/gram of raw ground beef to survive processing, 
storage, cooking, and host-defense systems and cause illness. It is 
hypothesized that acid tolerance is a contributing factor to the low-
infectious dose noted for this human pathogen. Sustained acid tolerance 
in serotype O157:H7 strains is primarily regulated by the stationary-
phase sigma factor o38, encoded by rpoS. The University has identified 
a rpoS-regulated Protein (CspE) that is present in acid tolerant 
strains of serotype O157:H7 strains and absent, or present at reduced 
quantities, in acid-sensitive strains. This protein has been previously 
identified as a cold-shock protein with no known function. Analysis of 
protein and DNA sequences finds a high proportion of basic amino acids, 
indicating that CspE is a DNA-bind protein Dps is another previously 
described rpoS-regulated protein with DNA-binding properties that 
result in DNA protection against oxidative stress. Because DNA is 
sensitive to low pH and survival is dependent upon its protection, the 
goal of this project is to define the contributions of CspE and Dps to 
DNA protection in low pH environments (i.e. foods and synthetic gastric 
fluid). Results from this study will provide industry and public health 
agencies with the much needed data to further refine strategies for 
control, identify areas of risk, and add to the scientific knowledge on 
the survival of E. coli O157:H7.
          special food safety research grants fiscal year 1998
Awards made after competitive peer review process
    Nonthermal Processing Alternatives to Ensure the Safety of Apple 
Cider Cornell University, $86,345. This project will evaluate 
ultraviolet light, dimethyl carbonate and sulfur dioxide as 
alternatives to pasteurization of apple cider to reduce or eliminate E. 
coli O157:H7. These treatments would be cost-effective for small 
producers and yield a product acceptable to consumers.
    Location of S. stanley in Alfalfa Seeds and Sprout; Relation to 
Treatment Efficacy, Rutgers University, $174,387. This proposal 
addresses spatial location and survival of almonella stanley in alfalfa 
seeds and sprouts, and defines new strategies using chlorine to kill . 
stanley during germination and sprout growth. The contamination of 
sprouts with seedborne pathogens is an important food safety issue.
    Development of Washing Procedures to Reduce the Microbial Numbers 
on Fresh Produce, North Dakota State University Agricultural Experiment 
Station, $47,543. The objective of this proposal is to develop simple 
washing procedures using household ingredients such as vinegar, baking 
soda, and bleach, usable by consumers to reduce microbial contamination 
on fresh produce, with an emphasis on E. coli.
    Inactivation of Microorganisms in Fruits and Vegetables by Ozone 
and Chlorine Dioxide Gas, Purdue Research Foundation, $208,873. The 
objective of this project is to improve the safety of minimally 
processed and refrigerated fruits and vegetables by combining modified 
atmosphere packaging with the gaseous disinfectants ozone and chlorine 
dioxide. The sensory quality of the treated produce will be examined to 
ensure that it will still be acceptable to consumers.
    Reducing Edible Sprout Microbial Contamination Using Foam Seed Mat 
Technology, Ag Innovations LLC, State College, PA; $112,085. This 
project will investigate growing edible sprouts in hydrophilic 
(``water-loving'') foam as a method of reducing or eliminating 
seedborne bacterial pathogens. The researchers believe that the foam 
can soak up free water that may support the growth of pathogens. In 
addition, they will attempt to increase the usefulness of the foam by 
impregnating it with antimicrobial compounds.
    Detection of Food Borne Pathogens on Fruits and Vegetables by PCR, 
University of Delaware, $75,997. This project will assess the 
usefulness of a commercially available PCR test kit for almonella, E. 
coli O157:H7 and Listeria monocytogenes in detecting these pathogens on 
fresh and minimally processed fruits and vegetables. The investigator 
plans to develop guidelines or modifications to allow this kit to be 
used for rapid identification of these pathogens.
    New Approaches for Removal of Food Borne Pathogens from Surfaces of 
Raw, Fresh Produce, University of Arkansas, $153,309. This project will 
study the effectiveness for different audiences of treatments to remove 
food borne pathogens from the surfaces of fruits and vegetables. For 
food service providers and consumers, they will investigate the use of 
GRAS (generally recognized as safe) household chemicals such as 
acidified table salt or cooking oil. Research on chelators or edible 
films in combination with bacteriocins, (antimicrobial proteins) will 
be directed towards the needs of food processors.
    Alternative Processing Techniques for Fresh Juices, University of 
Tennessee Agricultural Experiment Station, $206,589. This proposal 
addresses methods to reduce or eliminate the pathogens E coli O157:H7, 
almonella and Cryptosporidium parvum in apple cider and orange, grape 
and cranberry juices, by treatments involving UV light and ozone, alone 
or in combination.
    Capacitive Dielectric Heating as a Food Safety Intervention Method 
for Sprouted Seeds, Oregon State University Agricultural Experiment 
Station, $171,008. This project will study capacitive dielectric 
heating as a method to destroy pathogens on or in alfalfa and radish 
seeds used for sprouting. Capacitive dielectric heating is a technique 
in which an electric current passed through a mixture of materials with 
different physical properties, in this case seeds embedded in a gel, 
can be used to selectively heat the seeds. Much of the proposal is 
concerned with developing the appropriate treatment conditions to 
generate sufficient heat to kill pathogens in or on the seeds without 
affecting seed viability or melting the edible gel in which the seed 
will be embedded. This research addresses a serious food safety 
problem, contamination of sprouts with seedborne pathogens, for which 
there is currently no satisfactory intervention.
    Mechanical and Antimicrobial Treatments to Remove Pathogens from 
Produce, University of Florida, $184,195. This project's objectives are 
to define how pathogenic bacteria and viruses attach to surfaces of 
produce, determine the pathogens' survival rates on produce surfaces, 
and assess the usefulness of selected mechanical and antimicrobial 
treatments that are practical for industry and consumers to 
decontaminate ready-to-eat produce. The organisms to be studied are 
almonella, E. coli O157:H7, and rotavirus SA-11. It is particularly 
valuable that the researchers have chosen to include a rotavirus in 
their study, as these viruses are among the major causes of acute 
gastroenteritis worldwide, yet their ecology is not well understood.
    Development of Pathogen Reduction Treatments for Fresh Produce, 
Auburn University, $251,573. This project will investigate the use of 
antimicrobial compounds applied in cooling, washing or transportation 
water, low-dose ionizing radiation, or combinations of the two, to 
reduce or eliminate microbial pathogens from the surface of fresh 
fruits and vegetables. Both the antimicrobial compounds and low-dose 
ionizing radiation have been shown in principle to have antimicrobial 
activity in foods. The study will analyze the usefulness of these 
compounds against specific pathogens E. coli O157:H7, Listeria 
monocytogenes, Salmonella and Giardia lamblia, on fresh fruits and 
vegetables to develop treatment recommendations, and will assess the 
effects of the treatments on the quality of the produce.
    Liposome Biosensing Devices for Rapid Screening of Food Toxins and 
Pathogens, Cornell University, $184,449. This project will modify 
liposome biosensor technology for rapid detection of E. coli in foods. 
This technology employs encapsulated antibodies or DNA probes in single 
use ``dipstick'' devices that can be used in the field.
   special site specific food safety research grants fiscal year 1998
    Alliance for Food Protection, Nebraska, Georgia, $300,000. This is 
a collaborative alliance between the University of Georgia Center for 
Food Safety and Quality Enhancement and the University of Nebraska 
Department of Food Science and Technology. fiscal year 1998 funds 
supported research at the University of Nebraska on the detection, 
identification and characterization of food allergens, the effects of 
processing on peanut allergens, and investigation of the efficacy of 
using various types of thermal processes to reduce or destroy the 
toxicity and mutagenicity of certain Fusarium metabolites in corn and 
corn products. Research at the University of Georgia was directed 
toward determining the foodborne significance of Helicobacter pylori, 
determining the effect of antimicrobials to eliminate Arcobacter from 
pork, determining the survival of E. coli O157:H7 at reduced water 
activity, and using extrusion cooking to destroy peanut allergens. The 
University of Nebraska developed assays for detection of peanut, milk, 
egg, and almond residues in processed foods; produced high-quality 
antibodies for these assays; identified a soybean allergen and two 
sunflower seed allergens; discovered clues as to the reason why Brazil 
nuts cause severe allergic reactions; discovered that certain types of 
Fusarium fungi do not produce mutagenic substances; developed a simple 
liquid chromatographic procedure for determination of moniliformin 
toxin; found that the corn flake manufacturing process can reduce 
levels of fungal toxins such as aflatoxin and fumonisins; and also 
found that low levels of carcinogenic aflatoxins in corn grits might be 
reduced to less than regulatory actions levels by the corn flake 
manufacturing process. The University of Georgia has developed methods 
to culture Helicobacter pylori, and detect the pathogen in foods, the 
effect of antibiotics on the fate of E. coli O157:H7 in reduced water 
activity conditions, and found that extrusion cooking can greatly 
reduce allergens in peanuts.
    Center for Innovative Food Technology, Ohio, $281,000. Funds from 
the fiscal year 1998 grants supported research projects on using neural 
network/fuzzy logic tools to develop a model of a growing and 
processing cycle for canning tomatoes, using electrostatic coating for 
snack foods and baked goods, combining several non-thermal processing 
techniques to sterilize low acid liquid foods, using Near Infrared 
reflectance systems to measure protein and ash content in wheat flour, 
using membrane separation systems to produce extended shelf life milk 
products, and developing a protocol for testing the microbial load of 
ingredients in meat processing facilities.
    The original goal of the research was to develop innovative 
processing techniques to increase food safety and quality or reduce 
processing costs. The neural network project has developed a model for 
predicting the harvesting time that will optimize product quality and 
economic return to the grower, processor, and consumer. The coating 
project has demonstrated the shelf life, sanitation, and product cost 
advantages available through the use of this technology. The filtration 
project will allow fluid milk processors to lower their costs and 
increase water quality by removing high Biological Oxygen Demand 
materials from municipal treatment systems. The sterilization project 
will lower processing costs by increasing the shelf life of liquid 
products. The extended shelf life project has resulted in the marketing 
of single serving, long shelf life milk products, and the Near Infrared 
project will allow flour millers to develop improved process control 
systems.
    Food Irradiation, Iowa, $200,000. Since the Linear Accelerator 
Facility was placed in operation in March 1993, studies on the effect 
of irradiation on shelf-life extension, safety and quality of ground 
beef, beef steaks, ham, pork chops from loins, chicken breasts, and 
turkey have been conducted. Studies combing irradiation with high 
hydrostatic pressure and cooking, using whole chicken breasts, turkey 
and ham, have been conducted to determine the combination of these 
treatments that will yield a shelf-stable product while maintaining 
high eating quality. Several studies were conducted to determine 
whether consumers can detect a difference between irradiated and non-
irradiated ground beef patties. Experiments were also conducted to 
investigate consumer acceptance of pork products irradiated to prevent 
trichinosis. Test markets of irradiated chicken breasts were conducted 
to determine consumers' willingness to pay for irradiated products. 
Research on the effect of packaging materials on quality of irradiated 
meat is in progress.
    With the recent FDA clearance of irradiation of red meat, research 
needs leading to commercialization of this technology have been 
enhanced. Additionally, researchers from eight other research 
institutes have used the irradiation facility for research projects. 
The effectiveness of irradiation, using an electron beam accelerator, 
in destroying known pathogenic bacteria in pork and beef has been 
determined. Mathematical models have been developed to predict the 
growth of bacteria in low-dose irradiated ground pork. Demonstration of 
irradiation technology has been presented to some commercial firms, and 
plans are being developed for some large scale test markets.
    Food Processing Center, Nebraska, $42,000. The University of 
Nebraska Food Processing Center has been conducting short-term, highly 
applied research projects to assist small and mid-sized food processing 
companies and entrepreneurs to develop or improve processes and 
products and to develop new food processing enterprises. Projects were 
selected based on the estimated economic impact of the technical 
assistance or the criticality of the technical assistance to the future 
of the firm or venture. Priorities were placed on projects relating to 
the safety of the food product or process and to the fulfillment of 
regulatory mandates such as nutrition labeling, use of approved and 
effective ingredients, and adherence to regulations imposed by foreign 
governments. In addition, several research projects were conducted to 
improve or assess the quality, extend the shelf-life, or assess or 
improve the processing efficiency of specialty food products which 
impacted several processors or used alternative agricultural products.
    The goal of the research, as stated previously, is to assist small 
and mid-sized food processing companies and entrepreneurs to develop or 
improve processes and products and to develop new food processing 
enterprises. Technological evaluations were conducted for 120 
individuals or companies interested in developing new food processing 
businesses. These evaluations included formulations, processes, 
processing equipment, packaging, shelf-life, sensory, nutritional 
attributes, microbiological quality, regulatory considerations, and 
other factors. Additionally, microbiological analysis, shelf-life 
assessments, sanitation audits, and nutritional analyses were conducted 
for numerous Nebraska food companies.
    Food Quality, Alaska. This is a new grant in fiscal year 1999 
($350,000). Research will be aimed at establishing the Salmon Quality 
Implementation Project. The project has two parts. The first part is 
the evaluation, design, and implementation of a voluntary quality seal 
that can be attached to salmon that meet the existing standards for 
premium and number one grade. The second part is a series of workshops 
and training sessions on salmon quality handling and maintenance for 
workers at all levels of the industry from harvesting to retail.
    The original goal of this research was to ensure a consistent and 
predictable level of handling and quality for Alaska seafood. In doing 
so, the project will help Alaska seafood processors strengthen or 
maintain their place in domestic and international markets. Because 
this is a new grant, no progress has yet been reported.
    Institute for Food Science and Engineering, Arkansas, $950,000. As 
the flagship center for the Institute of Food Science and Engineering, 
the Center for Food Processing and Engineering has as its objectives to 
facilitate and encourage value-added research and improve the 
processing of agricultural products. The Center requires researchers to 
obtain matching funds from industry to support their research. Research 
projects have been funded by 39 different companies from 17 states and 
4 countries. The next request for proposals to the Institute will be 
issued in February 1999. The Center for Food Safety and Quality, with a 
mission to conduct research on the safety and quality of foods relative 
to microbiological and chemical hazards, was activated on January 1, 
1997. Center researchers are presently receiving funding through the 
Food Safety Consortium. The Institute has also received funding from 
the United Nations Food and Agriculture Organization to establish a 
Center of Excellence for Food Quality and Safety.
    The original goal of this research is to establish an Institute of 
Food Science and Engineering at the University of Arkansas-
Fayetteville. The Institute for Food Science and Engineering and the 
Center for Food Processing and Engineering are operating. Research 
projects at the Center include: postharvest management practices for 
rice, such as studies of physicochernical properties, bacterial load of 
rice products, and milling systems, and development of methods to 
improve the texture and dill flavor of pickles, and the color of 
acidified pickled vegetables, with estimated impact to the pickle 
industry of one half million dollars annually. Researchers have 
developed 12 mechanized systems for total vineyard mechanization which 
maintain or improve juice and wine quality. Research on 
physicochernical properties of potatoes and bitterness in carrots and 
have had estimated economic impacts of several million dollars. 
Research on elecrochemical flow-through systems for chicken processing 
water and near infrared/mid-infrared imaging for large scale fruit 
processing have important applications in industry. Institute staff, 
including the Descriptive Sensory Panel, have assisted both national 
food processing companies and small commercial kitchens in process 
development, with an impact of up to 2 million annually on the Arkansas 
vegetable processing industry. The Institute's Center of Excellence 
presents workshops in the United States as well as planning train the 
trainer courses in Mexico and Central America to improve the safety of 
imported fresh fruit and vegetables. To date, 70 publications, two 
IMPACT reports and a quarterly newsletter have served to keep the 
industry and fellow scientists informed of research and technology 
transfer activities.
    Midwest Advanced Food Manufacturing Alliance, Nebraska, $423,000. 
The purpose of the Midwest Advanced Food Manufacturing Alliance is to 
expedite the development of new manufacturing and processing 
technologies for food and related products derived from United States 
produced crops and livestock. The Alliance involves research scientists 
in food science and technology, food engineering, nutrition, 
microbiology, computer science, and other relevant areas from 12 
leading Midwestern universities and private sector researchers from 
numerous U.S. food processing companies. Specific research projects are 
awarded on a competitive basis to university scientists with matching 
funds from non-federal sources for research involving the processing, 
packaging, storage, and transportation of food products. Projects 
selected for funding are merit reviewed by non-participating university 
scientists, industry scientists and scientists from professional 
organizations. Close cooperation between corporate and university 
researchers assure that the latest scientific advances are applied to 
the most relevant problems and that solutions are efficiently 
transferred and used by the private sector.
    Eleven projects were funded from fiscal year 1997 funds with 
anticipated completion and final reports due by May 31, 1999. Nine 
projects were funded from fiscal year 1998 funds with anticipated 
completion and final reports due by May 31, 2000.
    Milk Safety, Pennsylvania, $268,000. The overall goal of the milk 
safety program is to provide insight into factors that help ensure an 
adequate and safe milk supply. Toward that end, the research has 
focused on factors that affect milk production, processing, 
manufacturing, and consumption. Special attention has been given to 
ways of preventing and/or treating pathogens that enter the milk 
supply. Projects are selected for funding each year based on 
competitive, peer reviews by scientists outside the recipient 
institution. The research is aimed at minimizing or eliminating future 
foodborne disease outbreaks from milk and dairy products. Researchers 
demonstrated that when subjected to a sublethal heat shock prior to 
pasteurization, Luterta monocytogenes becomes much more heat-resistant 
than previously thought, likely requiring the design of new 
pasteurization guidelines to ensure the safety of dairy products. They 
also developed a simple, fast, sensitive, specific and inexpensive 
method for the detection of Listeria monocytogenes in dairy products 
that will allow dairy processors to rapidly and easily screen for the 
presence of this pathogen in their products and in the processing 
environment. A computer model of Listeria monocytogenes growth in dairy 
foods under dynamic refrigeration conditions and during extended 
storage is under development to provide producers and processors a 
technology for further enhancing the safety of fluid milk and related 
products. Researchers have identified potential approaches for 
enhancing natural defense mechanisms of tile bovine mammary gland 
through vaccination and immunoregulation. Discoveries of factors 
influencing growth of taphylococcus aureus could be used to prevent or 
contain growth of this pathogen in foods. Researchers have identified 
and sequenced a gene from this bacterium that is essential for growth 
under stressful conditions. Consumer research has identified 
characteristics of consumers most likely to have a high general concern 
about milk and dairy product safety and nutrition.
    Preservation and Processing Research, Oklahoma, $226,000. Research 
has focused on the effects of preharvest and postharvest factors on the 
market quality of fresh and minimally processed horticultural products, 
including marigolds, pecans, watermelons, and peaches. Researchers are 
developing harvester prototypes for marigold flowers and drying and 
threshing systems for marigold petal drying and separation. A fruit 
orienting mechanism is being developed for incorporation into an on-
line grading system. An integrated harvesting and postharvest handling 
system is being developed for fresh market and processing market 
horticultural products. Research continues on methods to determine 
textural properties of pecans, determine optimum operating parameters 
for super critical carbon dioxide and other alternative partial oil 
extraction, and develop and optimize modified atmosphere packaging 
techniques for pecan shelf life extension.
    A systems approach to develop complementary cropping, harvesting, 
handling and processing operations has resulted in development of 
improved handling systems for cucurbit and tree fruit crops. 
Nondestructive processing systems for partial oil reduction of tree 
nuts have been developed to extend shelf life and lower the calorie 
content for the raw or processed product. Funding has been secured for 
construction of a commercial nut extraction facility in Oklahoma, 
pending successful pilot testing which is underway. Technologies and 
procedures previously developed for cucurbit and tree fruit systems are 
being applied to development of okra, pepper, sage, basil, tree nut 
sweet corn, and marigold cropping, handling, and light processing 
systems, with a targeted completion date of year 2001. Research from 
this project provided the basis for commercial high relative humidity 
storage of peaches and to attract companies to the state to construct 
new value added food processing facilities.
    Seafood Harvesting, Processing, and Marketing, Mississippi, 
$305,000. Research related to seafood safety, quality and by-product 
utilization is being performed. For fiscal year 1999, fruits will 
support research on 1) microbial population changes during retail 
display of shrimp, 2) development of an impedance-based method to 
rapidly detect microorganisms on shrimp, 3) determine physical, 
chemical, microbiological, and sensory differences between pond and 
tank aquaculture tilapia, and 4) evaluate processes for utilization of 
uncooked shrimp processing by-products for production of flavor 
extracts.
    The original goals of the research were to improve the quality and 
safety of catfish and improve the utilization of catfish byproducts and 
underutilized marine species. Due to successes of the original project, 
subsequent efforts are focusing on additional uses of seafood and 
aquaculture foods by improving processing strategies and providing 
alternative products from waste materials. The project has expanded to 
include crab, shrimp, oysters, freshwater prawns, hybrid striped bass, 
tilapia, and crawfish. FDA has passed rulings affecting the potential 
viability of Mississippi seafood and aquaculture harvesters and 
processors. Emphasis is being placed on addressing possible adverse 
consequences resulting from these changes.
    Alternative Salmon Products, Alaska, $400,000. Research was aimed 
at developing a commercial pin-bone removal machine to reduce 
production costs of salmon fillets and open markets for salmon fillet 
shatter packs. The research goal is the development of market-desired 
salmon products using wild-caught salmon. In 1998, researchers 
addressed the problem of deboning wild-caught fish so that they can be 
marketed frozen rather than canned, and compete effectively with pen-
reared salmon. Researchers designed, built and tested three prototype 
pinbone removal machines making sequential improvements in design.
    Question. FDA recently provided the Committee a table showing the 
funding and staffing levels for Food Safety Initiative activities, by 
Center and field-related activities, funded from the increased funding 
provided to FDA for food safety in each of fiscal years 1998 and 1999 
and proposed for fiscal year 1999. Please provide a copy of this table 
for the record.
    FDA answer. We are happy to provide a copy of this table for the 
record.
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    Question. The FDA Food Safety Initiative funding includes 
$109,335,000 million in funding for food safety activities funded for 
fiscal year 1997 and carried over as the Food Safety Initiative base 
for each of fiscal years 1998, 1999, and 2000. This base includes 
$100,476,000 for Foods'', $100,000 for Animal Drugs, and $8,759,000 for 
Other Activities. For each of fiscal years 1998, 1999, and proposed for 
fiscal year 2000, please indicate the food safety activities being 
supported (both FTE and funding level) from the base amounts listed 
above for the Food Safety Initiative.
    Answer. The food safety activities being supported from the base 
amounts for the Food Safety Initiative are listed in the following 
table.
    [The information follows:]
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    Question. Please list the increases requested in the President's 
fiscal year 2000 budget for the Food Safety Initiative in order of 
priority.
    USDA answer. The goal of the President's Food Safety Initiative is 
to further reduce the incidence of foodborne illness to the greatest 
extent feasible. USDA, FDA, CDC, and EPA have worked to build consensus 
and to identify opportunities to better utilize their resources and 
expertise, and to strengthen partnerships with private organizations. 
As directed by the President, the agencies have identified ways to 
strengthen the systems of coordination, surveillance, inspections, 
research, risk assessment, and education. The fiscal year 2000 budget 
therefore represents an integrated package that must be viewed as a 
unified, critical initiative.
    FDA answer. The Food and Drug Administration is requesting an 
increase of $30.0 million in fiscal year 2000. Surveillance, 
coordination, inspections, education, research and risk assessment are 
the interrelated building blocks of a strong science-based food safety 
system. By meeting objectives identified in these six areas, FDA will 
be able to better identify, track, and control food-related illness, or 
prevent, to the extent possible, future illnesses. Because 
surveillance, coordination, inspections, education, research, and risk 
assessment are the interrelated building blocks of a strong science-
based food safety system, it is difficult to prioritize the categories. 
Advances in research and risk assessment, in addition to surveillance, 
must be successful before education programs and inspections based on 
science-based solutions can be derived and implemented since research 
and risk assessments and surveillance activities will provide the basis 
for these science-based solutions. Activities within each FSI category 
provide or rely on data or activities from other categories. For 
example, Food safety research provides critically needed information to 
develop the means to identify and characterize more rapidly and 
accurately foodborne hazards; to develop food safety policy and set 
standards for safe food handling; to provide science-based tools for 
regulatory enforcement, including inspections based on preventative 
strategies such as HACCP; and to develop effective interventions that 
can be used, as appropriate, to prevent hazards at each step from 
production to consumption.
    Scientists and other food safety experts have concluded that the 
most effective and efficient mechanism to ensure that food processors 
identify and control hazards that could threaten the food supply is the 
application of preventive controls--HACCP principles. These science-
based technologies, standards, and strategies of the Food Safety 
Initiative are developed through several means, including the 
surveillance data collected to recognize trends and target prevention 
strategies that form the basis of inspections that are used to evaluate 
the effectiveness and efficiency of the industry's preventive controls; 
the conduct of research and risk assessments to determine the hazards 
which are used to identify critical control points for industry 
application of HACCP systems; and the conduct of research and risk 
assessments to verify that critical control points in HACCP systems are 
working, as well as, to target the data gaps that hamper preventive 
control systems from working. The Food Safety Initiative and 
implementation of HACCP systems, along with education programs, which 
will provide a more efficient and effective system for monitoring the 
nation's food supply to ensure safety and ultimately result in the 
reduction of foodborne illness.
    Question. If the caps on discretionary appropriations are enforced, 
as we expect, funding for nondiscretionary appropriations will be less 
than the fiscal year 1999 levels. Is increased funding for the Food 
Safety Initiative a priority if it must come at the expense of reducing 
funding for ongoing programs? What reductions in funding for existing 
programs would you recommend in addition to those requested in the 
President's fiscal year 2000 budget to offset necessary increases in 
funding for the Food Safety Initiative?
    USDA answer. The President's fiscal year 2000 budget includes 
proposals for financing discretionary programs within the statutory 
discretionary caps. Changes in authorizing legislation are proposed 
that would reduce mandatory spending, establish user fees or raise 
revenues where the savings would be designated as offsets to the 
discretionary caps and provide for increases in priorities such as the 
President's Food Safety initiative.
    FDA answer. Without knowing the exact impact of such reductions, I 
would be unable to speculate at this time on any reductions that might 
result from caps on discretionary appropriations. I would note that the 
President's budget request for fiscal year 2000 includes increases for 
all of FDA's major programs, recognizing the limits of FDA's ability to 
protect the public health in all of our program areas. I would also 
note that all of our program areas have taken effective cuts, including 
staffing reductions, in recent years as we have had to absorb pay 
raises and other inflationary costs. Therefore, I don't believe we 
could reduce other program areas to provide funding for the Food Safety 
Initiative without jeopardizing the effectiveness of our other 
programs.
    While improving the safety of the food supply is of the utmost 
importance, and is a high priority of this Administration, our other 
programs to promote and protect the public health in the areas of 
foods, drugs, biologics, and medical devices are also of vital 
importance.
                 Questions Submitted by Senator Gorton
    Question. USDA has requested more than $24 million for food safety 
research in the fiscal year 2000 budget. These research dollars are 
allocated by either eliminating or decreasing Agriculture Research 
Service and Cooperative State Research, Education and Extension Service 
programs consistently funded by Congress. What additional food safety 
research will be conducted by USDA that is not already being performed 
by the Centers for Disease Control, the National Institutes of Health, 
and the Food and Drug Administration? I am concerned that production 
agriculture research is being eliminated at USDA for the sake of food 
safety research that may already be ongoing at other federal agencies.
    USDA answer. Food safety research conducted by USDA agencies (ARS, 
CSREES, and ERS) is complementary to that conducted by DHHS agencies 
(CDC, NIH, and FDA). USDA agencies address agricultural production-
related issues of food safety and the early processing segments of the 
food chain. Increasingly, this research is important to farmers and 
ranchers to insure the quality and safety of their production. USDA 
research, in addition to being targeted to the technology needs of 
farmers and the food processing industry, provides science based 
technologies and risk assessments to enable FSIS to carry out its 
inspection and regulatory policies for meat, poultry, and eggs. Within 
DHHS, FDA research is focused on issues related to its regulatory 
responsibility for the safety of marketed domestic and imported foods 
other than meat and poultry products. The CDC and NIH focus their 
research activities on the surveillance and epidemiology of food borne 
illness outbreaks and fundamental work on the pathogenesis of enteric 
diseases in humans, respectively. The additional food safety research 
funding requested by USDA in fiscal year 2000 will not address 
activities already performed by CDC, NIH, and FDA, but instead will 
focus on improved pathogen detection and prevention technologies for 
meat, poultry, and horticultural crop production and processing, as 
well as understanding antimicrobial and antibiotic drug resistance of 
microbial pathogens that can infect both food producing animals and 
humans.
    Question. Your testimony suggests that Americans have a greater 
chance of encountering food borne illnesses due to increased consumer 
food choices and additional access to prepared foods. Recognizing the 
changes each agency has to make in order to address this new scenario, 
would you consider our food source less safe today than ten years ago? 
Five years go? Could you (USDA, FDA, or CDC) provide statistics or 
figures relating to how many illnesses and deaths a year can be 
attributed to food borne illnesses? Do the statistics suggest that the 
problem is being addressed?
    USDA answer: The statistics from FoodNet show that during 1998, 
9,787 laboratory-confirmed cases of 9 diseases under surveillance were 
identified: 4,031 of camplyobacteriosis, 2,849 of salmonellosis, 1,483 
of shigellosis, 565 of cryptosporidiosis, 508 of E. coli O157:H7 
infections, 186 of yersiniosis, 106 of listeriosis, 50 of vibrio 
infections, and 9 of cyclosporiasis. Although these data don't reflect 
all foodborne illnesses that occur, we suggest that they are 
representative of the nationwide pattern of foodborne illnesses.
    CDC collects epidemiological data relating to the incidence and 
type of food borne illness that occur within the United States. ARS 
provides research information relating to risk factor analysis that are 
used by CDC in determining the risk of sustaining a food borne illness 
from a specific food type. For example, ARS released the Salmonella 
Risk Assessment Modeling Program for Poultry (S-RAMP), and the Food 
Animal Risk Model for Poultry Pathogens (FARM-PP) which predicts the 
severity of outcomes from consumption of poultry products with 
Salmonella and Campylobacter.
    ARS does not collect human epidemiological statistical data 
relating to illnesses or deaths attributed to food borne illnesses.
                                 ______
                                 
    FDA answer. Estimates of foodborne illness and death are imprecise 
and widely diverse. The Council for Agricultural Science and Technology 
(CAST) estimates that 9,000 deaths and 6.5 to 33 million illnesses in 
the United States each year are food related. CDC is in the process of 
analyzing and updating estimates of foodborne illness and death. 
Statistics suggest that, despite advances to produce safe food and 
protect consumers, foodborne illness remain a significant public health 
problem. FDA will carefully review the analysis and will provide 
additional data when possible.
    It also is important to recognize that, as surveillance and 
laboratory methods improve, we may see an increase in foodborne 
illness. Better surveillance leads to better and more accurate disease 
detection, which in turn leads to more investigations. As surveillance 
improves, more outbreaks, not fewer, will be detected. By finding and 
investigating such outbreaks, CDC can define risks, develop and 
implement interventions, and over the long term target and ultimately 
eliminate the risk.
    In order to determine whether our food source is safer today than 
it was five or ten years ago, we need to compare the incidence of death 
and illness from foodborne pathogens over that particular time period. 
However, estimates of foodborne illness and death are imprecise and 
widely diverse. The number of deaths and illnesses attributed to 
foodborne disease are estimates--calculated from the number of 
individual cases that come to the attention of CDC and other public 
health agencies--from clinicians, laboratory analyses and surveys. Only 
1 to 10 percent of actual cases of foodborne illness are reported. 
Therefore, multiplication factors are obtained from small studies to 
allow estimates of the total illness. These values all have an 
uncertainty range about them, and the final estimate will be the most 
likely value with an accompanying range of possible values. The widely 
quoted estimates of 6.5 million to 33 million annual cases and 9,000 
deaths come from the 1994 Council for Agricultural Science and 
Technology or CAST report on Foodborne Pathogens.
    The recently developed FoodNet system is designed to be more 
comprehensive in collecting the incidence of illnesses and to determine 
the various factors more accurately. As additional FoodNet information 
is collected, the estimates of illness should become more accurate and 
the ranges should be reduced. We would be happy to provide information 
for the record on the rate of detection of selected pathogens.
    [The information follows:]

   RATE \1\ OF SELECTED PATHOGENS DETECTED BY THE FOODBORNE DISEASES ACTIVE SURVEILLANCE NETWORK (FOODNET) \2\
                     ILLNESS RATES OF FOODBORNE PATHOGENS FROM THE 1996-1998 FOODNET SYSTEM
----------------------------------------------------------------------------------------------------------------
                             Isolate                                   1996            1997            1998
----------------------------------------------------------------------------------------------------------------
Campylobacter...................................................            23.5            25.2            21.7
Cryptosporidium.................................................         ( \3\ )             2.7             2.5
Cyclospora......................................................         ( \3\ )             0.3               0
E.coli O157:H7..................................................             2.7             2.3             2.8
Listeria........................................................             0.5             0.5             0.5
Salmonella......................................................            14.5            13.6            12.4
Shigella........................................................             8.9             7.5             8.5
Vibrio..........................................................             0.1             0.3             0.3
Yersinia........................................................             1.0             0.9             1.0
                                                                 -----------------------------------------------
        Total...................................................        \4\ 51.2        \4\ 50.3           47.2
----------------------------------------------------------------------------------------------------------------
\1\ In 1996, active surveillance was initiated for laboratory-confirmed cases of Campylobacter, Shiga toxin-
  producing E.coli O157, Listeria, Salmonella, Shigella, Vibrio, and Yersinia infections in Minnesota and Oregon
  and in selected counties in California, Connecticut, and Georgia. In 1997, surveillance for laboratory-
  confirmed cases of Cryptosporidium and Cyclospora infections was initiated in Minnesota and Oregon and in
  selected counties in California and Connecticut. Data presented in this table are from these original FoodNet
  sites only.
\2\ Values are illnesses per 100,000 population.
\3\ Not reported.
\4\ Excludes Crytosporidum and Cyclospora.
 
NOTE: This table is based upon information provided in CDC's March 12, 1999 Morbidity and Mortality Weekly
  Report (MMWR).

    Although the development of baseline data from FoodNet is still in 
its early stages, the figures from the CDC report of March 12 may 
indicate that the Food Safety Initiative efforts are having an affect 
in some areas. Comparing data from the five original FoodNet sites, 
overall incidence of laboratory-confirmed infections caused by the 
pathogens under surveillance declined from 1996 to 1998.
    Although the U.S. systems for reporting foodborne disease are 
globally pre-eminent, they only capture a fraction of the cases that 
occur. This limitation reflects the fact that for sporadic cases of 
foodborne disease, only a small percentage of these medical events are 
reported. Even with outbreaks involving multiple victims, only about 40 
percent are investigated sufficiently to identify the causative agent. 
One goal of the Food Safety Initiative has been to improve this 
reporting system, while simultaneously initiating programs to prevent 
foodborne disease. It is also important to recognize that, as 
surveillance and laboratory methods improve, we may see an increase in 
foodborne illness. Better surveillance leads to better and more 
accurate disease detection, which in turn leads to more investigations. 
As surveillance improves, more outbreaks, not fewer, will be detected. 
By finding and investigating such outbreaks, FDA, CDC, and USDA can 
define risks, develop and implement interventions, and over the long 
term target and ultimately eliminate the risk.
    Question. Where do you believe the biggest food safety threat 
lies--in domestic produced crops, imported commodities, consumer 
preparation, or a mix? Where would the emphasis of the U.S. tax dollar 
be best spent?
    FDA answer. Risk and benefits cost analyses have been done or are 
being done for some food safety risks such as E. coli O157:H7 in ground 
beef and Salmonella in eggs. Much more needs to be done for other food 
safety risks. Unfortunately, risk assessment is far less developed for 
foodborne pathogens than for chemical hazards. Even chemical hazards, 
for which risk assessment methods have been the most thoroughly 
developed, data gaps force continued use of assumptions about exposure, 
hazard potency, and characteristics of the populations at risk.
    The President's Council on Food Safety has requested that the 
Interagency Food Safety Risk Assessment Consortium consider how to 
develop a comparative risk analysis for food safety strategic planning. 
Various steps may need to be taken to evaluate risks including a 
ranking of foodborne pathogen risks based on surveillance and economic 
data; consideration of a broader range of food safety hazards including 
not only microbial risks, but also pesticides and chemicals; and 
finally, selection of highly ranked hazards, an evaluation of control 
measures, and an evaluations of net benefits.
    Risk assessment provides a strong foundation upon which efficient 
allocation of scarce food safety resources can be made. It plays a 
central role in the development of any science-based system of 
preventive controls. Risk assessment also provides essential 
information for estimating and analyzing the costs and benefits of 
policy alternatives. We are continuing to emphasize the development, 
testing, and validation of microbial risk assessments and foodborne 
illness evaluation methods. Improving risk assessment will allow us, in 
the future, to target the prevention of foodborne disease by informing 
surveillance plans, prevention strategies for process control systems 
and for food inspections based on HACCP principles, and research 
programs to fill critical food safety information gaps. By 
incorporating the results of risk assessments with economic analyses, 
we will enhance our understanding of the economic consequences of 
specific food safety policies and make better-informed choices among 
alternative and policy options.
    Question. Pending at FDA is a proposed rule to require the 
imposition of mandatory HACCP on juice processors. Recognizing that 98 
percent of all juices are pasteurized, what is FDA's rationale for the 
imposition of HACCP on juice processors that use a guaranteed pathogen 
kill step?
    FDA answer. While pasteurization effectively controls pathogens in 
juice, there are other hazards associated with juice that are not heat-
treatable. Hazard Analysis and Critical Control Point or HACCP is a 
preventive strategy for food safety that addresses microbiological, 
physical and chemical hazards. Because of the variety of hazards 
associated with juice, FDA tentatively concluded that HACCP and safety 
performance criteria offer the most effective way to control the 
significant microbial hazards, along with other potential hazards, that 
may affect public health. The Agency's decision was based on a 
recommendation by the National Advisory Committee on Microbiological 
Criteria for Foods that HACCP with a performance standard could form 
the general framework needed to ensure the safety of juices. The HACCP 
proposal for juice includes a 5-log performance standard for pathogen 
control that producers must meet in order to have a valid HACCP plan.
    FDA proposed on April 24, 1998, that HACCP be mandatory for the 
juice industry and is currently involved in rule making on this matter. 
HACCP also considers chemical and physical hazards in addition to the 
microbiological hazards. The proposal gives excellent examples of 
instances in which non-microbiological hazards occurred in juice 
products. These examples were tin, poisonous plant parts, lead, 
patulin, unapproved use of food and color additives, improper 
sanitation procedures or faulty equipment, glass, plastic and a more 
recent 1999 recall with undeclared sulfites in grape juice.
    Question. Where do you believe the biggest food safety threat 
lies--in domestic produced crops, imported commodities, consumer 
preparation, or a mix? Where would the emphasis of the U.S. tax dollar 
be best spent?
    FDA answer. FDA believes that the biggest threat to food safety 
lies within a mix of factors. As a result of this mix of factors, U.S. 
dollars are best spent on a mix of the six FSI categories--
surveillance, coordination, inspections and compliance, risk 
assessment, research and education. Each of the categories are 
intertwined and serve a unique function in addressing the threats to 
domestic crops, imported commodities, consumer preparation, and other 
sources such as retail establishments, including food restaurants, 
vending operations, and institutional feeding operations such as 
schools, hospitals and nursing homes.
    Surveillance and investigation are powerful tools to detect new 
foodborne disease challenges, to determine what specific food sources 
are implicated in foodborne illness, and to learn how best to keep 
foods from becoming contaminated. Enhancing the capacity of states to 
monitor foodborne disease and to investigate and control outbreaks will 
lead to better general control measures and fewer illnesses.
    Federal and state inspection programs are an important component of 
the nation's food safety inspection system that cover domestic and 
imported products. The move toward HACCP will pose a challenge to the 
states to implement. Federal agencies can help the state systems meet 
that challenge. If HACCP is to be an effective program for ensuring 
that food processors have modern, state-of-the-art procedures in 
effect, FDA must improve its inspection capabilities, so that the 
highest--risk food plants are inspected at least once per year.
    Risk assessment is far less developed for foodborne pathogens than 
for chemical contaminants. Intensive commitment is necessary to develop 
critically needed methods of analyzing the available data and 
addressing its uncertainty; methods that account for variability, 
specifically of living microbial pathogens, are essential.
    Food safety research is critically needed to develop the means to 
identify and characterize more rapidly and accurately foodborne 
hazards, to provide the tools for regulatory enforcement, and to 
develop effective interventions that can be used as appropriate to 
prevent hazards at each step from production to consumption.
    An integral part of the overall food safety initiative is providing 
food safety education to a variety of audiences: consumers, that is the 
general public and specific groups at risk for foodborne illness; 
public health professionals and physicians; retail, food-service, and 
institutional food preparers; veterinarians, animal and other food 
producers; and food transportation workers. The challenge is to create 
educational messages that address the risks relevant to each audience 
throughout the food chain.
                                 ______
                                 
                Questions Submitted by Senator McConnell
    Question. In 1998 FSIS and FAS estimated implementation and 
enforcement of new country of origin labeling requirements for imported 
meat would cost USDA $60 million. There are no funding requests for 
implementation of such a program in USDA's fiscal year 2000 budget. 
Should Congress pass imported meat country of origin labeling 
legislation, how will USDA pay for the costs associated with the 
establishment and enforcement of such a program?
    USDA answer. The cost estimates to which you refer were 
preliminary, and based on the fact that the greatest impact would 
appear to be at the retail level, since most labels on fresh meat cuts 
are applied at retail and FSIS has limited presence at the retail 
level. Should this legislation be enacted, we would have to examine 
what resources would be necessary for implementation.
    The country of origin labeling report currently being developed 
will propose various monitoring and enforcement regimes. Briefly, those 
options include: (1) enforcement by USDA at retail; (2) limited 
enforcement at wholesale establishments, which are already regulated by 
USDA; (3) enforcement at retail by States or other Federal agencies 
involved in marketing; (4) monitoring and referral through private, 
third-party certifiers; or (5) enforcement through a whistleblower or 
competitor complaint system. Depending on the regulatory regime 
Congress chooses, other Federal or State agencies or third parties may 
be able to perform these tasks at a lesser cost.
    Question. What offsets would have to be made in other program 
areas?
    USDA answer. The broad issue of country of origin labeling is 
primarily a marketing issue, not a food safety issue. FSIS must apply 
its resources to ensure the safety of meat, poultry, and egg products.
     Question. If the price of meat rises as a result of country of 
origin labeling mandates, how will this impact individuals who rely on 
government assistance for their family food purchases?
    USDA answer. From preliminary information, it would be expected 
that, if the price of meat increases as a result of mandatory country 
of origin labeling, all consumers of meat products would experience a 
corresponding price increase, at least in the short term, including 
those who rely on government assistance programs. According to data 
from USDA's Economic Research Service (ERS), the amount of imported 
fresh muscle cuts of beef consumed in the U.S. is very small compared 
to consumption of the same domestically produced product. The volume of 
imported beef muscle cuts represents about one percent of domestic beef 
production.
    Question. Will country of origin labeling for imported meat result 
in higher cattle or sheep prices or higher profits for products?
    USDA answer. Information from USDA's the Economic Research Service 
(ERS) and the Foreign Agricultural Service (FAS) that a country of 
origin labeling requirement would probably increase some costs to 
packers, processors, and retailers. These would include the cost of 
preserving the identity of domestic and imported products, the direct 
costs of new or revised labels, and possible shifted costs if firms 
cease using imported products as a result of a new labeling regime. 
Domestic products would have to be labeled, too. It is reasonable to 
expect that those costs would be passed along to consumers to some 
extent. The profits realized by the sale of those products would depend 
on the increased cost of processing and distribution in relation to the 
costs incurred as a result of new requirements, and the degree to which 
product manufacturers believe they can pass along those costs to 
consumers and still remain competitive in the marketplace.
    Question. Is the United States a net exporter or net importer of 
meat products? What has been the trend over the past several years?
    USDA answer. The United States is a net exporter of all meat 
products, including all red meat and poultry meat. In 1998, U.S. meat 
exports were 4.2 million tons valued at $6.4 billion and imports were 
1.3 million tons valued at nearly $2.8 billion. The U.S. meat trade 
surplus in 1998 was about 3 million tons valued at $3.6 billion.
    Poultry meat exports account for most of the surplus as the United 
States is the world's largest poultry meat exporter but imports only 
minimal amounts. The United States is a significant importer of beef 
and pork. In 1998, U.S. net exports of beef and pork, including variety 
meat, were 317,000 tons and $1.3 billion. In comparison, the U.S. 
poultry meat trade surplus was 2.5 million tons and $2.1 billion.
    The meat trade surplus has grown significantly since 1994. In value 
terms, the meat surplus was $2.6 billion in 1994, peaking at $4.7 
billion in 1996. The recent decline in the value of the meat trade 
surplus is due to lower meat prices during the past 2 years and a sharp 
drop in Russian imports of poultry meat at the end of 1998. The trade 
balance in volume terms had been steadily increasing until the onset of 
the Russian ruble crisis. The balance in volume terms was slightly 
lower in 1998.
    Question. Which countries represent the largest markets for U.S. 
meat exports?
    USDA answer. The leading markets for U.S. meat exports are Japan, 
Russia, Mexico, Canada, Hong Kong, Korea, and Taiwan. In volume terms, 
Russia is the leading U.S. meat export market because of the large 
quantities of poultry meat exported there--more than 715,000 tons in 
1998 and 981,000 tons in 1997. However, in terms of value, Japan is the 
leading U. S. market by a large margin. U.S. meat exports to Japan were 
$2.4 billion in 1998, accounting for 37 percent of the total value of 
U.S. meat exports. Mexico at $860 million was the second leading market 
for the United States, followed by Russia at $708 million and Canada at 
$681 million. Russia and Hong Kong are primarily markets for U.S. 
poultry meat, while Japan, Canada, and Mexico are leading destinations 
for both poultry and red meat. The United States exports red meat to 
Korea and Taiwan.
    Question. Would the establishment of a new meat labeling regime in 
the United States be viewed as a non-tariff barrier by our trading 
partners?
    USDA answer. FSIS requires that all meat imported into the United 
States bear the name of the country of origin, which remains with the 
product to the retail level--unless it is further processed under U.S. 
inspection. Meat and poultry products can only be imported into the 
United States from countries and plants approved by and recognized as 
imposing inspection requirements ``at least equal to'' those of the 
U.S. To this end, labeling is approved prior to entry. The proposed 
legislation would set a new precedent regarding the rules of origin and 
product labeling which could invite mirror action by U.S. trading 
partners. Mandatory country of origin requirements could change the way 
both domestic and foreign meat retailers and others involved in 
production and distribution do business, thereby affecting their costs 
and consumer choices. Article IX of the GATT 1994 allows countries to 
require marks of origin on imported products, so long as the marking 
requirement does not seriously damage the imported products, materially 
reduce their value, or unreasonably increase their cost. However, if 
the new labeling requirement does not qualify under GATT-permitted 
marking rules, i.e. if the label requires the word ``imported'' rather 
than the specific country name, it might be challenged as violating 
national treatment and constituting a prohibited restriction. In 
addition, if the effect on imports is severe enough, a protesting 
country could bring a WTO non-violation nullification or impairment 
challenge against the new labeling requirement.
    Question. Would the establishment of such a labeling requirement 
affect U.S. exports?
    USDA answer. The effect on U.S. exports would depend upon the types 
of labeling requirements established by foreign countries.
    Question. Has the United States challenged labeling or other non-
tariff barriers proposed in other countries?
    USDA answer. The United States continues to oppose mandatory 
labeling of foods obtained through biotechnology--European Union (EU) 
biotechnology labeling. It has also criticized other foreign nations, 
i.e. Korea and EU, for attempting to adopt similar country of origin 
requirements for meat products, and has challenged Korea, the Kingdom 
of Saudi Arabia and the other Gulf Cooperation Council countries--
Kuwait, Qatar, Bahrain, Oman, UAE--for imposing mandatory government 
set shelf-life labeling requirements which impede U.S. food imports. In 
each case, the new labeling requirements were inappropriate remedies 
unrelated to either the safety or quality attributes of imported food 
products being marketed.
    Question. You recently told the House Agriculture Appropriations 
Subcommittee that some meat and poultry plants are resisting the effort 
to remove unnecessary layers of the old inspection system. Could you 
please provide the Senate Agriculture Appropriations Subcommittee with 
more complete detail about the types of plants that are resisting de-
layering and a list of specific regulations that plants have told the 
agency they do not want removed?
    USDA answer. A number of establishments have strongly opposed FSIS 
regulatory reform efforts regarding certain regulations. The 
elimination of prior approval for proprietary substances and nonfood 
compounds included within the proposed rule on ``Sanitation 
Requirements for Official Meat and Poultry Establishments'' (62 FR 
45045); the conversion of the historically prescriptive thermal 
processing (canning) requirements into performance standards (9 CFR 
318.300 and 381.300); and the elimination of prior approval for 
equipment included within the final rule on ``Eliminating of Prior 
Approval Requirements for Establishment Drawings and Specifications, 
Equipment, and Certain Partial Quality Control Programs'' (62 FR 45016) 
are among those reforms opposed by various segments of the industry.
    Question. Is imported meat, or meat derived from imported cattle, 
less safe than meat of domestic origin?
    USDA answer. FSIS has measures to ensure that imported meat is safe 
through its stringent equivalence requirements including reinspection 
activities at ports of entry. Approximately 9,000,000 pounds of product 
are rejected each year due to reinspection. In 1998 9,923,000 pounds 
were refused.
    Question. Would country of origin labeling enhance food safety?
    USDA answer. There are no data that support a link to food safety.
    Question. FSIS has been testing ground beef for E. coli O157:H7 
since 1996. Out of 26,088 samples, they have found only 25 positives. 
How much is it costing USDA to look for something they only find 0.096 
percent of the time, or less than once in every one-thousand samples 
tested.
    USDA answer. The Food Safety and Inspection Service (FSIS) spends 
approximately $10.4 million per year on testing meat and poultry 
products for 9 potentially deadly pathogens, including E. coli O157:H7, 
Salmonella, Campylobacter, and Listeria.
    Question. None of these samples were connected to an outbreak or 
illness--so what is the val ue of this testing?
    USDA answer. The testing program for E. coli O157:H7 began after 
the tragic outbreak of foodborne illness associated with this pathogen 
in the State of Washington. USDA estimates that over 10,000 illnesses 
per year result from consuming foods contaminated with E. coli O157:H7.
    As the Washington outbreak demonstrated, the most susceptible to 
this pathogen include children, the elderly, and the immune 
compromised. Testing programs like that for E. coli O157:H7 assist FSIS 
in controlling deadly pathogens by identifying contaminated product in 
time to remove it from the market before it can cause foodborne 
illness. The justification for continuing this program is that the 
agency believes this testing program is reducing the risk of illnesses/
outbreaks caused by E. coli O157:H7 in raw ground beef. The FSIS 
program of random sampling at federal, State, and import establishments 
and at the retail level, as well as the implications of a positive 
finding, encourage the meat industry to use good manufacturing 
practices, good sanitation procedures, antimicrobial interventions, 
microbial testing, and other measures to eliminate this serious 
pathogen from the nation's meat supply.
    Question. Most of the 26,088 samples were collected from grocery 
stores. How can testing at grocery stores for E. coli O157:H7 or any 
pathogen contribute to the protection of the public's health if the 
consumer has already eaten the food by the time you get the test 
results back? Shouldn't the testing be done before the food reaches 
stores?
    USDA answer. The FSIS Raw Ground Beef Products Testing Program 
collects approximately 60 percent of the samples from retail stores and 
approximately 40 percent of the samples directly from processing 
plants. Many retail stores further process ground beef from a federal 
plant, and the testing program is targeted to detect contamination 
problems at this level. Further, FSIS conducts a variety of separate 
testing--monitoring--programs for foodborne pathogens in ready-to-eat 
products, and all of these monitoring samples are collected at the 
processing plant level. Detection and removal of pathogen-contaminated 
foods at any point of distribution will serve to protect the public 
from foodborne illness, if an effective recall can be accomplished. 
Again, knowledge of food contamination problems promotes corrective 
actions on the part of producers, and serves to prevent future 
foodborne health hazards.
    Question. I understand that FSIS has announced a plan to test 
moving its food inspectors out of the Federal slaughter and processing 
plants and move them into retail such as into grocery stores. Grocery 
stores are already under inspection by FDA and the state and local 
public health departments. This doesn't seem very efficient or 
productive given that other areas are in greater need of food safety 
inspection. For example, Senator Susan Collins and the Government 
Accounting Office have identified a real need for increased inspection 
of imported foods at the ports of entry. Why not put these inspectors 
where there is a need rather than where you will just be duplicating 
effort? Do you have any data to show that grocery stores need more 
inspect ion than imported foods?
    USDA answer. Reassigning FSIS inspectors to FDA for port-of-entry 
inspection is not a viable option for these reasons. Under HACCP 
implementation, FSIS does not contemplate any change in the continuous 
inspection requirements of the statutes or in the overall number of 
inspection personnel. FSIS anticipates full productive use of its 
inspection resources in pursuing food safety work for meat, poultry, 
and egg products.
    The implementation of HACCP involves overseeing industry 
implementation and compliance with the regulatory requirements outlined 
in the Pathogen Reduction and HACCP final rule that was promulgated in 
July 1996. The HACCP provisions of that rule have different effective 
dates based on the size of establishments, e.g., large, small, and very 
small. The last phase of implementation does not occur until January 
2000 when very small plants are required to implement HACCP systems.
    During fiscal year 1999, FSIS redeployed approximately 100 
employees from large HACCP plants to cover critical vacancies in small 
HACCP plants. This redeployment of inspection personnel was done to 
assure that adequate resources were available to oversee successful 
implementation of HACCP in small plants. We do not anticipate any 
further need to redeploy inspection personnel prior to implementation 
of HACCP in very small plants in January 2000.
    Under the slaughter models component of the HACCP-based Inspection 
Models Project, FSIS is exploring alternative ways in which slaughter 
inspection might be accomplished in establishments that have already 
implemented HACCP systems and that exclusively slaughter certain market 
classes of animals. These market classes are young poultry, steers and 
heifers, and market hogs. In all cases, these are young, healthy 
animals that do not exhibit the same disease and public health concerns 
that may be present in older animals. The alternative slaughter 
inspection models under consideration meet current statutory 
requirements for continuous inspection, but may require fewer 
inspection personnel within the slaughter department of some 
establishments.
    FSIS has food safety and other statutory obligations that are 
sufficient to fully occupy the inspection resources that may become 
available through this project. It is necessary as part of the 
verification of industry HACCP systems to assure that product bearing 
the Federal marks of inspection continues to move through 
transportation, distribution, and marketing channels in a manner that 
does not cause such product to become adulterated or misbranded. The 
second component of the HACCP-based Inspection Models project, the in-
distribution model, addresses this issue by using a limited number of 
inspection resources to expand existing oversight of Federal product 
in-distribution channels.
    For the record, FSIS and the National Joint Council of Food 
Inspection Locals have reached an impasse in negotiations necessary to 
begin the pilot tests for both the slaughter models and the in-
distribution models. The parties have jointly requested assistance from 
the Federal Service Impasses Panel to resolve the impasse. Until such 
resolution occurs, the pilot tests will not be started and it would be 
premature to determine the number of resources that may be available 
for other FSIS food safety and economic adulteration concerns.
                                 ______
                                 
  Questions Submitted to Dr. Catherine E. Woteki, Under Secretary for 
                              Food Safety
                  Questions Submitted by Senator Burns
                      codex alimentarius standards
    Question. Codex Alimentarius is a program to encourage fair 
international trade in food and promote the health and economic 
interests of consumers. What effects do you expect Codex Alimentarius 
to have on international uniformity in food safety standards in the 
long-term?
    USDA answer. Codex standards have value as reference points. The 
food safety measures embodied in the standards, guidelines and codes of 
practice that constitute the Codex Alimentarius, if developed in 
accordance with principles that hold bases in sound science as the 
predominant value, will have unquestioned value to nations as bases for 
their own development of mandatory food safety measures. Nations could 
then act under the premise that the measure is scientifically linked to 
a specified public health concern. The value of Codex Alimentarius in 
the long term will be dependent on how true it remains to the 
principles of sound science. Codex standards are recognized as 
international standards for purposes of the Sanitary/Phyto-Sanitary 
(SPS) agreement and impact decisions of the World Trade Organization 
(WTO).
    Question. You stated that REE has conducted $64 million in food 
safety research, under ARS and CSREES. What were the primary findings 
and what do you intend to do with the results of this research?
    USDA answer. In fiscal year 1998 the USDA (ARS/CSREES/ERS) 
undertook $61.4 million in food safety research related to pathogens 
and chemical residues. A brief summary of ARS accomplishments during 
this fiscal year follows:
            accomplishments in the area of detection methods
A. Human Pathogens
  --Monoclonal antibodies (MAbs) that bind specifically to 
        Campylobacter jejuni and Campylobacter coli have been 
        developed, and patented. These antibodies will be used in an 
        immunologically based method (ELISA) to improve the current 
        specific detection methods for Campylobacter.
  --A laser assisted method (MALDI) has been developed for the rapid 
        detection of Campylobacter. The methods advantage is that only 
        a single bacterial colony is needed for analysis. The MALDI 
        technique also has the potential to be widely used for 
        confirmatory analysis of other pathogenic bacteria.
  --A nucleic acid based (PCR) method was developed which 
        simultaneously detects enterotoxigenic and Shiga toxin-
        producing E. coli (O157:H7) strains from calves. The method is 
        being used by diagnostic laboratories to rapidly identify, 
        differentiate and characterize pathogenic E. coli. will be 
        useful for to producers and veterinarians for the rapid 
        diagnosis of all the diseases caused by E. coli in calves.
  --An ELISA based test (immuno-precipitation pregnancy test design) 
        called Meridian was developed. The test uses monoclonal 
        antibodies to specifically detect all E. coli O157 strains, not 
        just O157:H7. Meridian has found widespread use by food 
        companies since it has a much lower incidence of false 
        negatives than other comparable tests.
  --In cooperation with IGEN of Gaithersburg, MD, ARS has developed an 
        immunomagnetic electro-chemiluminescent (IM-EC) method for the 
        detection of E. coli O157:H7. The test is rapid, sensitive to 
        low numbers of bacteria, inexpensive, and user-friendly. The 
        technology is currently under evaluation by the FSIS.
  --Optimized methods to identify, differentiate, and characterize 
        pathogenic E. coli isolates from bovine sources were developed. 
        Anti-O157 MAbs in an ELISA format accurately detected serum 
        antibodies to E. coli O157, as well as to the important non-
        O157 EHEC serotypes, E. coli O26 and E. coli O111, in cattle 
        and other livestock. Serum detection of antibodies to E. coli 
        O157:H7 will allow accurate detection of all animals exposed to 
        this pathogen at any time during animal growth.
  --A laser based detector that illuminates fecal contamination on meat 
        was developed and patented. The instrument could be used to 
        immediately alert meat packers to contamination, allowing 
        carcasses to be promptly decontaminated.
  --Research by ARS determined that automated nucleic acid based 
        ribotyping of Salmonella was a better discriminator between 
        isolates than serotyping. Ribotyping however, is not a 
        replacement for serotyping. It was recommended that for 
        epidemiological investigations, both techniques should be used 
        simultaneously.
B. Chemical Contaminants
  --A method of analysis for multiple diverse pesticides was developed 
        for fatty samples using chromatography/ion trap mass 
        spectrometric detection. The method enables extraction of meat 
        tissue as well as fat, expands the range of pesticides that can 
        be analyzed. The method uses no chlorinated solvents, and 
        provides a single step quantitation and confirmation analysis. 
        This method will increase the capabilities of regulatory and 
        other laboratories to analyze pesticide residues in food, and 
        will provide more accurate data for risk assessment purposes.
  --A monoclonal antibody capable of detecting the antibiotic 
        Hygromycin B was formatted into a rapid ELISA assay, and a 
        patent was issued and the antibodies licensed to a private kit 
        manufacturing company. The method will allow the detection of 
        drug residues in poultry by regulatory agencies.
  --Supercritical fluid extraction and microdialysis methodologies have 
        been developed to isolate and detect prohibited drug and other 
        chemical residues in eggs. The methods have been transferred to 
        the FDA and the FSIS for their evaluation, and use, as dictated 
        by their regulatory programs.
  --Valid and reliable laboratory methods for assaying iron were 
        established as an indicator of soft bone constituents in trim 
        beef derived form advanced meat recovery systems (AMRS). 
        Studies indicated that iron content of AMR trim beef could be 
        determined by either dry ash or wet ash (nitric/sulfuric) 
        procedures, although the dry ash method was selected for 
        routine analysis. The procedure will be implemented by the 
        FSIS.
  --An instrument for monitoring chlorine dioxide during disinfection 
        of food processing water was developed. The membrane sensor can 
        determine chlorine dioxide in the presence of chlorine and/or 
        other oxidants and provide instantaneous analytical results. 
        The instrument can be used to assure both adequate residual 
        levels and to minimize unnecessary water overuse.
Progress in the area of pathogen reduction:
  --In order to determine the effectiveness of a pathogen reduction 
        method bacteria need to be modified to allow their 
        identification and discrimination from background microflora. 
        ARS has developed a genetic technique that allows the 
        construction of (model) pathogens that bioluminesce under UV 
        light due to production of a green fluorescent protein (GFP). 
        Various model strains of E. coli O157:H7 and Salmonella were 
        constructed having the same growth and attachment 
        characteristics as the wild type strain. This research 
        technology will aid in understanding the basis of microbial 
        attachment and detachment to animal carcasses in real-time. The 
        technology also offers a more rapid means to evaluate 
        antimicrobial carcass treatments that do not rely on sampling, 
        culturing and back-extrapolation of the resulting plate counts 
        to large surface areas.
  --ARS concluded research on washing and sanitizing hog hauling 
        trailers and holding pens. The results have led to procedures 
        to significantly reduce Salmonella, Campylobacter and E. coli 
        contamination on animals entering slaughter plants.
  --A surface pasteurization technique was developed to reduce 
        microbial contamination (Salmonella, Campylobacter and 
        Listeria) on the surface of solid foods without loss of 
        quality. A prototype design to briefly steam fresh whole 
        broiler carcasses, so that surface organisms are killed but 
        with no appreciable cooking of the meat, was built, tested and 
        patented.
  --Various conventional and experimental wash formulations were 
        evaluated to determine their efficacy in decontaminating apples 
        of human pathogens (Salmonella, E. coli O157:H7, Listeria). 
        Solutions containing 5 percent hydrogen peroxide, alone or in 
        combination with acidic detergents achieved a 3-4 log pathogen 
        reduction. These studies demonstrated that current conventional 
        methods of washing apples are largely ineffective. Development 
        of efficacious cleaning methods for fruit are crucial for the 
        production of unpasteurized juices.
  --Low dose gamma irradiation was found to be efficacious for 
        destroying the human bacterial pathogens E. coli O157:H7, 
        Listeria and Salmonella on seed used for the growth of sprouts. 
        Irradiation is a useful technology that significantly reduces 
        pathogens in certain food commodities, while increasing shelf 
        life and maintaining freshness, all major consumer demands.
Progress in the area of pathogen control through intervention 
        strategies:
  --A competitive exclusion culture (CEC) to control Salmonella on 
        commercial broiler farms was developed. The FDA approved this 
        CEC under the trade name PREEMPTTM for use in commercially 
        produced broiler chickens. This was the first CEC to receive 
        FDA approval for use in commercial poultry flocks, and is a 
        major milestone in an integrated program to prevent Salmonella 
        contamination in food products from poultry.
  --Feed withdrawal in broilers prior to slaughter is used to induce 
        molt and to stimulate egg laying in aged flocks, however, 
        withdrawal increased infection rates in their crops by 
        Salmonella and Campylobacter. Research showed that methods such 
        as adding lactose to drinking water had the ability to restore 
        resistance, and reduce infection rates.
  --Electrostatic ionization of the air in an area housing S. 
        enteritidis-infected adult birds was found to reduce the number 
        of S. enteritidis in the air environment. Airborne transmission 
        of Salmonella has gained considerable recognition as an 
        important mechanism of spread of this pathogen within poultry 
        houses.
  --A porcine lymphokine (IL-12) that activates a protective responses 
        in neonatal pigs has been isolated from the splenic T cells of 
        S. enteritidis--immune pigs. Oral administration of the 
        lymphokine will protect weaned pigs from S. choleraesuis organ 
        invasion, cecal colonization, and will enhance growth 
        performance and neutrophil function. Enhancing the host immune 
        response to bacterial and parasitic infection will decrease the 
        dependence on antibiotic administration.
  --Cattle fed large amounts of grain (> 45 percent of DM), accumulate 
        volatile fatty acids in the colons resulting in a decline in 
        gut pH. This causes a significant increase in total E. coli 
        numbers and acid resistance. However, cattle fed hay appeared 
        to have decreased total E. coli numbers, and decreased acid-
        resistance. Although additional studies are required, it is 
        possible that feeding hay to cattle prior to slaughter may 
        significantly reduce post harvest contamination by pathogenic 
        E. coli.
  --It was discovered that some naturally occurring food additives 
        blocked the attachment of E. coli to bovine fascia and 
        connective tissues. Inhibition of E. coli O157:H7 attachment to 
        intact meat tissues by use of these substances will offer an 
        processors additional means to help to prevent E. coli O157:H7 
        contamination of meats.
  --ARS in collaboration with FSIS conducted a nationwide evaluation of 
        color of cooked beef patties relative to potential food safety 
        risk for E. coli O157:H7. The study provided solid evidence 
        that cooked beef patty color is not a good indicator of 
        internal patty temperature. The results were a major factor in 
        the development of the new FSIS consumer message that 
        ``consumers should not eat ground beef patties that are pink or 
        red in the middle unless a food thermometer has been used to 
        verify cooked temperature.''
  --The discovery that electropolishing surfaces significantly reduces 
        attachment of pathogens such as Campylobacter and subsequent 
        biofilm formation. This finding will aid equipment 
        manufacturers in developing methods and selecting materials to 
        be used in processing foods.
  --Controlled atmospheric storage of fresh produce does not appear to 
        offer a viable method for controlling Listeria monocytogenes. 
        Therefore the fresh cut industry should consider alternate 
        methods for controlling this pathogen.
  --Low dose gamma irradiation was found to be efficacious for the 
        control of parasitic pathogens, such as, the coccidia 
        Cyclosporidium and Cryptosporidium, on soft fruits such as 
        berries, while increasing shelf life and maintaining freshness, 
        all major consumer demands.
Progress in the area of antimicrobial/antibiotic resistance:
  --The acid tolerance of E. coli O157:H7 contributes to its ability to 
        cause disease by increasing both its ability to persist in 
        food, and its infectivity. ARS developed a technique to induce 
        maximum acid tolerance in these microorganisms, and identified 
        that the sensitivity to acid inactivation is dependent on 
        acidulant identity, prior exposure to an acid environment, and 
        strain identity.
  --Over 5,000 clinical, non-clinical and slaughter Salmonella isolates 
        were analyzed under the National Antimicrobial Susceptibility 
        Monitoring System. This monitoring program in collaboration 
        with the FDA and CDC provides critical information to prolong 
        the useful life of antibiotics for both human and animal use, 
        and its success has allowed expansion of the program to include 
        testing of Campylobacter and E. coli.
Progress in the area of risk assessment:
  --Bioluminescent strains of Salmonella were used as a tool for 
        modeling behavior of Salmonella in raw and cooked poultry 
        products. The data were incorporated into version 2.0 of the 
        Salmonella--Risk Assessment Modeling Program for Poultry (S-
        RAMPP). A new simulation model, the Food Animal Risk Model for 
        Poultry Pathogens (FARM-PP) was also developed which predicts 
        the severity of outcomes from consumption of poultry products 
        contaminated with Salmonella and/or Campylobacter.
    The results of this research will be shared and utilized among the 
various governmental agencies involved in food safety research. The 
staff members of the various agencies are in frequent contact with one 
another regarding research agenda in their respective programs. They 
also participate with each other in workshops, and committee meetings. 
The results will also be shared with Universities scientists at 
professional meetings, producers and processors at national, state and 
regional meetings, as well as through manuscripts published in 
refereed, trade or government publications.
    Because CSREES provides funding via extramural grants to various 
universities, research institutes and laboratories, it is difficult to 
provide a complete accomplishment for specific grants which were 
awarded in 1998 for periods of 2-3 years. Therefore, we have provided 
some outcomes which are directly related to food safety research grants 
made by CSREES within the past 2-3 years. We would anticipate even 
greater accomplishments with the current portfolio of research projects 
now in progress as a result of the increased funding in 1998.
National Research Initiative
    The Food Safety program of the National Research Initiative has 
several significant results from research funded in prior fiscal years. 
These results can be grouped in five areas: bacteriocins, basic 
microbial physiology, prevention of microbial colonization, biosensor 
development and production system epidemiology. In the following 
examples, more than one university usually has been involved in the 
research which has culminated in the outcomes cited. Where feasible, 
specific states have been mentioned in the text.
    Bacteriocins.--Bacteriocins are proteins produced by lactic acid 
bacteria (the kind responsible for producing cheeses and yogurt) that 
have the property of inhibiting the growth of other, possibly 
pathogenic, bacteria. Investigators have been able to extract and 
purify these proteins from several kinds of lactic acid bacteria. One 
of these bacteriocins, called nisin, has been adapted as a coating for 
machine parts in processing plants and has been demonstrated to retard 
the growth of pathogenic bacteria in this setting.
    Microbial Physiology.--Genetic and physiologic studies on microbial 
contaminants increase our understanding of their disease producing 
capabilities. Listeria monocytogenes is a bacteria that can normally 
grow at refrigeration temperatures. Investigators have found mutants of 
these bacteria that are cold-sensitive and produce so called ``cold-
shock'' proteins. These cold-shock proteins are being studied to see if 
they inhibit the growth of normal L. monocytogenes and if they can be 
produced in quantities sufficient to be useful as antibacterial washes. 
Several studies on Escherichia coli O157:H7 have demonstrated that some 
of its pathogenic potential results from tolerating acid levels present 
in some foods that would normally inhibit the growth of bacteria. 
Further work on this has been funded.
    Prevention of Microbial Colonization.--If pathogenic microbes 
cannot attach themselves to tissue surfaces, their ability to produce 
disease is severely reduced. Two ways that have been investigated are 
competitive exclusion and immunization. The principle of competitive 
exclusion is to block the tissue receptors to which the microbes would 
normally attach. Investigators have demonstrated that the inclusion of 
a yeast, Saccharomyces cerevisiae, in the drinking water in poultry 
raising facilities will keep pathogenic Salmonella enteritidis from 
colonizing the chicken gastro-intestinal tract. Research has also been 
funded to test a vaccine against E. coli O157:H7 in cattle. Preliminary 
results have demonstrated a level of serum antibody sufficient to keep 
the bacteria from binding in calves.
    Biosensor Development.--Fusarium moniliforme is a fungus that 
infects corn and corn-products resulting in the production of a 
mycotoxin, fumonisin, which is both poisonous and carcinogenic. 
Investigators report that they have developed an ELISA assay for 
fumonisin that detects in the 10-100 ppm range with an accuracy of 65 
percent. This is ten times more sensitive than the standard test. 
Another research group developed a PCR-ELISA for E. coli O157:H7 that 
was 100 times more sensitive than the current test and also suitable 
for large-scale screening tests. Another ELISA was developed to detect 
Staphylococcus aureus toxin in foods. The test can be run in four 
minutes in a processing plant environment. Development of a 
piezoelectric sensor for Salmonella species has been successfully 
tested and is being combined with other multi-probe biosensors on a 
commercial line.
    Production System Epidemiology.--A survey for Salmonella bacteria 
was conducted on 18 swine finishing farms in North Carolina. The field 
study revealed that all the farms had Salmonella of varying species and 
serotypes present in both the adult and nursery swine. The most 
important finding was, however, that current cleaning and disinfection 
procedures are insufficient to kill all of the Salmonella bacteria 
present in one group of pigs from infecting the next group of pigs 
placed in the ``clean'' facility. This was confirmed on 5 of the 18 
finishing farms.
                        special research grants
Epidemiology of Escherichia coli (E. coli) in beef cattle--Kansas State 
        University
    This research is now entering its fourth year. Shedding of E. coli 
has been monitored on a frequent basis for more than 24 months in both 
small and large cow-calf operations. Percent of cattle shedding 
bacteria varies among times of the year and has appeared to be 
associated with certain management practices. Shedding is especially 
high during the calving period when cattle are brought together in 
closer proximity. Management systems to reduce the frequency of 
shedding are now being evaluated. It appears that contaminated water 
sources are a major source of exposure for the cattle.
Fresh Fruits and Vegetables--several universities
    The Food Safety Research Grants program funded 12 projects directed 
at food safety problems involving fresh fruits and vegetables in the 
fiscal year 1998 funding cycle. These projects were directed at 
detection systems, methods for pathogen reduction on fresh produce, and 
non-thermal treatments for juices. A variety of institutions received 
these grants representing all sectors of the U. S. (Indiana, Delaware, 
North Dakota, New Jersey, New York (Cornell), Tennessee, Arkansas, 
Florida, Oregon, and Alabama).
    Outcomes from this research are being used as the basis for 
development of educational programs which are delivered to a variety of 
constituents including consumers, food handlers, producers, production 
advisors, veterinarians, and others.
    ERS accomplishments related to food safety include:
    Costs associated with campylobacter.--As detailed in an article in 
Food Review, ERS research showed that the estimated annual costs of 
Campylobacter-associated Guillan-Barre Syndrome (GBS) are $0.2-$1.8 
billion. When these costs are added to the previously ERS-estimated 
costs of campylobacteriosis ($1.3-$6.2 billion), total annual costs 
from Campylobacter are $1.5-$8.0 billion (1995 dollars). Assuming 55-70 
percent of costs are attributable to food borne sources, costs of 
campylobacteriosis from food sources ($0.7-$4.3 billion) and costs of 
associated GBS ($0.1-$1.3 billion) combined equal total annual costs of 
$0.8-$5.6 billion from food borne Campylobacter. Reducing Campylobacter 
in food could prevent up to $5.6 billion in costs annually.
    Distributional consequences of food borne illness.--The economic 
impact of the costs of food borne disease on the U.S. economy was 
reported in an article, ``A Distributional Analysis of the Costs of 
Food borne Illness: Who Ultimately Pays,'' Journal of Agricultural and 
Applied Economics. Previous estimates of the costs of seven food borne 
pathogens were disaggregated by type and distributed across the 
population. Initial income losses resulting from premature death cause 
a decrease in economic activity. Medical costs, in contrast, result in 
economic growth, though this does not outweigh the total costs of a 
premature death. This accounting of how costs and illnesses are 
diffused through the economy provides useful information for policy 
makers.
    Methods for valuing food safety risk reductions.--Food borne 
diseases caused by microbial pathogens impose an economic burden on 
society by causing premature death and productivity losses when people 
made sick are unable to return to work. An article, ``Measuring the 
Consumer Benefits of Food Safety Risk Reduction,'' Journal of 
Agricultural and Applied Economics explored three valuation 
methodologies that place a monetary value on food safety risk 
reduction, and presented a case study for each. These techniques 
include contingent valuation models (where consumers are asked in 
surveys their willingness to pay for food-safety risk reductions), 
experimental auctions (where people actually exchange money for 
products with varying levels of food-safety risk), and the cost-of-
illness approach (which values health risks on the basis of medical 
costs and productivity losses assigned to food borne illness).
    ARS research has also been valuable to FSIS in areas over which 
FSIS has no jurisdiction. For instance, research that ARS completed for 
food animal production and transport is currently aiding the industry 
in meeting pathogen reduction guidelines. Indeed, both the results of 
ARS research plus advice received from ARS scientists aided FSIS in 
making the HACCP rule an effective and practical instrument.
    Question. The President's goal is to ``develop a comprehensive food 
safety strategy and coordinate food safety budgets that will result in 
further improvements in the safety of the food supply and will ensure 
the most effective use of Federal resources''. Can you outline, the 
specific steps that have been taken to ensure this happens and how you 
plan to implement them?
    USDA answer. On August 25, 1998, through Executive Order 13100, the 
President established the Council on Food Safety. The Council is co-
chaired by the Secretaries of Agriculture and of Health and Human 
Services and the Assistant to the President for Science and Technology/
Director of the Office of Science and Technology policy. The President 
charged the Council to develop a comprehensive strategic plan for 
federal food safety activities and to make recommendations to the 
President on how to implement the plan. In addition, the Council will 
advise Federal agencies in setting priority areas for investment in 
food safety and developing a coordinated budget for the Administration. 
Finally, the Council will oversee the research efforts of the Joint 
Institute for Food Safety Research. The development of a strategic plan 
is already underway. In fact, the President's Food Safety Initiative 
was an initial step towards a national food safety plan. The plan's 
principal goal is to enhance the safety of the nations food supply and 
protect the public health through a seamless science-and risk-based 
food safety system. The plan will set priorities, improve coordination 
and efficiency, and identify gaps in the current system and mechanisms 
to fill those gaps, continue to strengthen and enhance prevention 
strategies, and develop performance measures to show progress.
    The implementation process will certainly pose some significant 
challenges because of the diversity of stakeholders in food safety. 
There will be a need to have a high degree of cooperation, 
coordination, and communication, since each Federal, state and local 
agency has unique mandates, authorities, history, culture, and 
operating procedures. The Council plans to use an open process in 
developing the plan--a process that will be responsive to all 
stakeholder concerns--in order to have credibility and obtain public 
support.
    Question. The National Academy of Sciences (NAS) has found that 
successful integrated operation of a food safety system requires that 
officials at all levels of government work together in support of 
common goals of a science-based system. How do you intend to facilitate 
interagency cooperation?
    USDA answer. Federal food safety agencies and State and local 
agencies have expertise and resources that, when combined in an 
integrated program, significantly enhance the impact of food safety 
programs. While more needs to be done to optimize and develop new 
partnerships, the Federal food safety agencies have already established 
extensive interactions with state and local regulatory agencies. We 
believe that the strategic planning process under the direction of the 
President's Council will provide new opportunities for officials at all 
levels of government to participate as primary and equal partners in 
the development of the future food safety system.
    Question. On October 5, 1998 USDA's Recall Policy Working Group 
issued a report making several recommendations for improvements in the 
operation of food recalls. What is the status of USDA's implementation 
of the Recall Policy Working Group's recommendations?
    USDA answer. The Agency provided an opportunity for public comment 
on the working group's report. It has evaluated the comments that it 
received and is now in the process of preparing a set of 
recommendations for the Secretary. The Agency will take appropriate 
action based on the Secretary's decision.
                                 ______
                                 
Questions Submitted to Thomas J. Billy, Administrator, Food Safety and 
                           Inspection Service
    Question. E. coli outbreaks continue to be a problem in the 
agricultural sector. Although numbers of incidences are down, public 
perception of beef and beef products do not appear to have improved 
significantly. How does the FSIS intend to work further with industry 
and consumer groups to reduce illness and improve consumer perception?
    USDA answer. The Agency's Meat and Poultry Hotline and consumer 
education program have long provided answers to questions and basic 
consumer information about E. coli and safe practices for preparing 
foods. In fiscal year 1998, the Agency partnered with the Agricultural 
Research Service to study the color of ground beef--as it relates to 
reaching a safe internal temperature of 160 degrees. As a result of the 
study's findings, the Agency published new consumer information about 
safely preparing hamburgers using a thermometer instead of using color 
as an indicator of doneness.
    The Agency has also began work with the thermometer industry and 
retail establishments to encourage them to make thermometers easily 
available to consumers and make their packaging carry correct and 
consistent information about safe temperatures.
    Question. Listeria monocytogenes is estimated to have affected 1100 
people. How will FSIS continue to address the listeriosis issue and 
reduce the rate of illnesses?
    USDA answer. FSIS has undertaken an aggressive strategy to decrease 
the risks from Listeria on ready-to-eat products. Included in this 
strategy is: developing guidance to industry on ``best practices'' that 
can help to reduce the potential of product contamination; targeting 
consumer education for high-risk groups; initiating a study to address 
shelf-life and Listeria risks; and, conducting a quantitative risk 
assessment for Listeria that will determine the foods that pose the 
greatest risk to consumers and specific subpopulations at increased 
risk of contracting listeriosis.
    Question. I congratulate you on your timely address of the Y2K 
issue. I urge you to continue to raise awareness of the Y2K problem and 
the threat it may pose to our nation's food supply, as well as to plan 
to address any problems that may occur within the food safety industry. 
When will you have Y2K revisions completed?
    USDA answer. The Food Safety and Inspection Service (FSIS) is 
continuing to raise awareness of the Year 2000 (Y2K) problem through 
its outreach efforts to the public and industry. The Agency is 
participating in USDA's Food Supply Working Group (FSWG) and operates 
its own Year 2000 Homepage, which is linked to that of the FSWG.
    FSIS has recently issued a letter to managers of Federally-
inspected meat, poultry and egg establishments, updating them on Agency 
progress in achieving Y2K compliance and alerting them to the needs to 
ensure that their own systems will not experience Y2K problems.
    The Agency has completed Y2K revisions and testing for its mission 
critical systems. We plan to complete Y2K work on our remaining non-
mission critical systems, telecommunications and vulnerable systems and 
processes by September 30, 1999.
    Question. What are the specific implications of having AMS assume 
part of the certification responsibility in the exporting industry?
    USDA answer. As long as the export service remains voluntary and 
fee-based, there is no implication of having AMS assume a part of the 
certification. Although AMS is not a regulatory agency, its mission is 
to foster and assist in the development of new or expanded domestic and 
foreign markets. AMS partially accomplishes this through voluntary, 
user-funded grading, certification, and inspection of agricultural 
commodities, some of which are exported. It is the policy of AMS to 
immediately notify APHIS, FDA, or FSIS regarding any hazards observed 
during the performance of our services.
    Question. User fees, or a food safety tax, such as the one 
proposed, could hurt the 500,000 workers who depend on the economic 
well-being of the agriculture industry. It would lead to a loss of jobs 
and damage businesses, large and small, that depend on the economy of 
rural America. Agricultural producers are struggling to make ends meet. 
They cannot afford the effects new user fees will have on the already 
depressed market. What other means will FSIS employ to gain funding 
that user fees would provide?
    USDA answer. If the proposed user fee funding structure is not 
approved by the Congress, FSIS will pursue obtaining appropriated funds 
to continue its mission of ensuring the safety of meat, poultry, and 
egg products that are supplied to the general public.
    Question. I understand you have been in discussions with the FDA 
about the possibility of a cooperative effort between the agencies 
where resources freed-up by the implementation of HACCP in meat and 
poultry facilities would be utilized at ports of entry for inspecting 
imported foods. What is the status of those discussions?
    USDA answer. Reassigning FSIS inspectors to FDA for port-of-entry 
inspection is not a viable option for these reasons. Under HACCP 
implementation, FSIS does not contemplate any change in the continuous 
inspection requirements of the statutes or in the overall number of 
inspection personnel. FSIS anticipates full productive use of its 
inspection resources in pursuing food safety work for meat, poultry, 
and egg products.
    The implementation of HACCP involves overseeing industry 
implementation and compliance with the regulatory requirements outlined 
in the Pathogen Reduction and HACCP final rule that was promulgated in 
July 1996. The HACCP provisions of that rule have different effective 
dates based on the size of establishments, e.g., large, small, and very 
small. The last phase of implementation does not occur until January 
2000 when very small plants are required to implement HACCP systems.
    During fiscal year 1999, FSIS redeployed approximately 100 
employees from large HACCP plants to cover critical vacancies in small 
HACCP plants. This redeployment of inspection personnel was done to 
assure that adequate resources were available to oversee successful 
implementation of HACCP in small plants. We do not anticipate any 
further need to redeploy inspection personnel prior to implementation 
of HACCP in very small plants in January 2000.
    Under the slaughter models component of the HACCP-based Inspection 
Models Project, FSIS is exploring alternative ways in which slaughter 
inspection might be accomplished in establishments that have already 
implemented HACCP systems and that exclusively slaughter certain market 
classes of animals. These market classes are young poultry, steers and 
heifers, and market hogs. In all cases, these are young, healthy 
animals that do not exhibit the same disease and public health concerns 
that may be present in older animals. The alternative slaughter 
inspection models under consideration meet current statutory 
requirements for continuous inspection, but may require fewer 
inspection personnel within the slaughter department of some 
establishments.
    FSIS has food safety and other statutory obligations that are 
sufficient to fully occupy the inspection resources that may become 
available through this project. It is necessary as part of the 
verification of industry HACCP systems to assure that product bearing 
the Federal marks of inspection continues to move through 
transportation, distribution, and marketing channels in a manner that 
does not cause such product to become adulterated or misbranded. The 
second component of the HACCP-based Inspection Models project, the in-
distribution model, addresses this issue by using a limited number of 
inspection resources to expand existing oversight of Federal product 
in-distribution channels.
    For the record, FSIS and the National Joint Council of Food 
Inspection Locals have reached an impasse in negotiations necessary to 
begin the pilot tests for both the slaughter models and the in-
distribution models. The parties have jointly requested assistance from 
the Federal Service Impasses Panel to resolve the impasse. Until such 
resolution occurs, the pilot tests will not be started and it would be 
premature to determine the number of resources that may be available 
for other FSIS food safety and economic adulteration concerns.
    Question. HACCP inspections for very small plants are scheduled for 
January 25, 2000. ``There are about 40 state inspected plants in 
Montana; most already above federally inspected standards. Some of the 
state inspected plants in fact are larger than the approximately three 
federally inspected plants. Under the FSIS program, state inspected 
plants must meet standards greater than or equal to federal standards. 
Will the FSIS use discretion and common sense in examination of these 
plants?
    USDA answer. FSIS has been very proactive is supporting the 
transition to HACCP for small and very small State and federal plants. 
Examples of FSIS assistance include:
  --FSIS provided training and training materials to State program 
        trainers who are presenting the training to State inspectors.
  --FSIS has put on ``HACCP demonstration projects'' and public 
        meetings for industry groups including state and federal 
        plants.
  --FSIS provided training materials for use by States in working with 
        industry in HACCP training.
  --FSIS has a National HACCP Coordinator--for HACCP in small and very 
        small plants--who is accessible to State inspection programs 
        and plants.
  --A State HACCP network is in place that is a cooperative 
        undertaking. Each State has a primary contact, often the State 
        inspection program director and a coordinator, often a 
        technical person from a university.
  --The National HACCP Coordinator--for HACCP in small and very small 
        plants--holds periodic nationwide conference calls with the 
        State HACCP contacts to address any and all HACCP issues.
  --FSIS prepared a letter that was sent to all federal very small 
        plants regarding a recommended HACCP preparation time-table and 
        assistance for HACCP implementation. The same information is 
        being provided to all State programs for their use.
    The FSIS Technical Service Center (TSC) is responsible for in-plant 
reviews for foreign plants, federal plants and State plants. The 
procedure used to review or ``examine'' State HACCP plants is 
consistent with the process used for foreign and federal plants and has 
been in place since January of 1999. Furthermore, in-plant reviews are 
performed using a team concept. The team is made up of the FSIS, TSC 
reviewer, the director of the State program, or his/her designee, the 
relevant State supervisor and the inspector-in-charge. The State 
program has the option to take the lead during the review. The findings 
are reviewed prior to leaving a plant and, to date, consensus has 
consistently been reached.
                                 ______
                                 
              Questions Submitted by Senator Conrad Burns
    Question. It is extremely important to have all state laboratories 
included in a system such as PulseNet, which is a program to enhance 
the ability of laboratory-based surveillance to rapidly identify 
clusters of related foodborne infections. How will CDC gain 
participation in all states in order to increase awareness and decrease 
foodborne illnesses?
    FDA/CDC answer. CDC agrees that it is important to include all 
States in the PulseNet system in view of PulseNet's vital role in 
surveillance and investigation of foodborne illness outbreaks. States 
area critical element in the Nation's public health system, and are 
eager to participate in PulseNet and other systems to improve capacity 
to protect public health. Prior to PulseNet, most public health 
laboratories recognized the value of DNA fingerprinting, but few had 
ability to do such fingerprinting. Those that did have the capability 
did not use standardized techniques. PulseNet participants use a 
standardized protocol and have the capability to exchange information 
quickly.
    Through its Emerging Infections Programs and Epidemiology and 
Laboratory Capacity cooperative agreements, CDC provides funds to 
public health laboratories for PulseNet training and technology 
transfer. Additional states are participating in PulseNet each year.
    Question. A strong science base, as you mentioned, is vital to the 
Food Safety Initiative. Unfounded reports hurt agricultural producers 
immensely and must be stopped. How does the FDA plan to work with 
industry groups to ensure that science is used as a basis for a ll 
reports of outbreaks?
    FDA/CDC answer. In fiscal year 1998, the foundation was set for 
creating a state-of-the art science-based food safety system. The 
system focuses on early detection and containment of foodborne hazards, 
and prevention, education and verification. As part of the Food Safety 
Initiative or FSI, FDA has met with representatives of producers, 
wholesale/distributors and retail agricultural commodities to solicit 
their input and support to develop more effective and timely tracebacks 
of agricultural commodities implicated in foodborne outbreaks.
    The level of science being applied to foodborne disease through FSI 
resources is rapidly identifying clusters of related cases and 
contaminated foods that would have been missed just a few years ago. To 
develop a comprehensive, coordinated national foodborne illness 
outbreak response system among federal, state and local agencies, DHHS, 
USDA, and EPA signed, in May 1998, a memorandum of understanding to 
create the Foodborne Outbreak Response Coordinating Group, or FORC-G. 
This group's objective is to enhance coordination and communication 
among federal, state and local agencies, guide efficient use of 
resources and expertise during an outbreak, and prepare for new and 
emerging threats to the U.S. food supply. In addition to federal 
officials, other members of FORC-G include the Association of Food and 
Drug Officials, Association of Public Health Laboratory Directors, 
Council of State and Territorial Epidemiologists, and the National 
Association of State Departments of Agriculture.
    In June 1998, FDA participated in a workshop at the annual meeting 
of the Association of Food and Drug Officials, or AFDO, on the need to 
improve outbreak coordination and investigations. Participants agreed 
that improved coordination of communication between the epidemiologists 
who investigate systematic and emerging food safety system failures and 
food regulatory officials who control the preventive and corrective 
facets as well as the food product and production environment of the 
food regulatory system is critically needed.
    In September 1998, FDA hosted an important meeting of food safety 
officials from all 50 states, the District of Columbia and other 
localities, Puerto Rico, USDA and CDC to better integrate appropriate 
food safety functions at the local, state and federal levels. 
Integration efforts are focusing on inspection, analytical methodology, 
laboratory utilization, and response to disease outbreaks. The goals of 
this integration effort are better use of laboratory resources and 
investigative expertise and faster response to and control of foodborne 
illness outbreaks. FDA will seek input from industry and consumers on 
their recommendations for a science-based national food safety system.
    In those instances where agricultural commodities are thought to be 
the vehicle, FDA and CDC will work with the state and local 
investigators to assure that on-site causes for the outbreak are 
carefully considered and illuminated before issuing reports or 
statements that the agricultural commodity was contaminated in 
distribution or at its source.
    Additionally, we are equally concerned that the information 
released to the public on an outbreak be as consistent, accurate, 
validated, and timely as possible. While it is sometimes impossible to 
have all the information verified at the moment a public health 
regulatory intervention must be communicated, it is a goal we always 
strive to achieve. FDA will work with appropriate local, state and 
federal agencies, and affected industries drawing on the available 
scientific expertise to make sound decisions. Some reports which 
question the safety of food originate from sources other than FDA. In 
these instances, the FDA Press Office and the Center for Food Safety 
and Applied Nutrition/Center for Veterinary Medicine/Office of 
Regulatory Affairs organizations work together to communicate the 
scientifically accurate information to the public. In addition, the 
Center for Veterinary Medicine, or CVM, issues CVM updates and also 
places this information on the CVM's internet home page.
    Question. FDA has consistently failed to meet deadlines on reviews. 
While the statutory deadline on approval of generic drugs is 6 months, 
the FDA continues to drag its feet and take up to 32 months for 
approval. It is vitally important to both drug companies and consumers 
to have these drugs approved and on the market. Many consumers cannot 
afford the high cost of brand name prescriptions, while drug companies 
lose enormous profits waiting on FDA approval. How will the FDA find a 
way to complete reviews on time?
    FDA/CDC answer. As background regarding Abbreviated New Animal Drug 
Applications or ANDAs, either an approval or disapproval is considered 
by FDA to be a final action. The agency makes every attempt to meet 
this requirement; however, for a number of reasons it is not always 
possible to do so. After receiving a disapproval action, manufacturers 
frequently resubmit applications that address the deficiencies 
indicated in the disapproval action.
    Neither the Center nor the Office of Generic Drugs has conducted a 
study on the budgetary needs to review the majority of applications 
within 180 days given the current review environment. However, it 
believes the needs are substantial and would have to include the needs 
of other Agency components that play a supporting but critical role in 
the generic drug review process.
    At this time, the Center believes that the key to addressing 
current review backlog and improving action times is increasing the 
number of chemistry, microbiology, and labeling reviewers as well as 
support staff within OGD.
    Question. Dr. Henney, I understand that Bill Schultz has left to go 
over to the Justice Department. What are your plans for his position 
and the Office of Policy?
    FDA/CDC answer. Mr. William K. Hubbard, Associate Commissioner for 
Policy Coordination, has assumed the responsibilities of Mr. Schulz's 
position. The Office of Policy will be included with all other 
components of the Office of the Commissioner in the organizational 
review that I committed to in my confirmation hearing in September 
1998. This study is underway, and I expect to make decisions on the 
future structure of the Office of the Commissioner in the near future.
    Question. The Food and Drug Administration Modernization Act 
(FDAMA) directed FDA to publish for pubic comment a proposed amendment 
to current regulation relating to the labeling of foods treated with 
ionizing radiation. The Conferees further directed that final 
regulations could be issued not more than 12 months after the date of 
enactment of FDAMA, which was November 21, 1997. FDA just recently 
published an Announced Notice of Proposed Rulemaking on the labeling of 
irradiated foods, an action that was clearly overdue. Why has it taken 
FDA so long to follow Congress' intent?
    FDA/CDC answer. FDAMA imposed on FDA several foods-related tasks 
both in the statutory language of FDAMA and its accompanying Conferees' 
report. FDA was able to complete virtually all of its statutorily 
mandated tasks within the time frames specified in FDAMA. FDA was also 
able to complete some of the tasks discussed in the Conferees' report 
within the specified time frames. FDA will continue to work diligently 
to accomplish all tasks in a timely manner.
    Congress addressed three specific tasks regarding food irradiation; 
timely decision by FDA on the petition to permit irradiation of meat; 
limitations on FDA's authority regarding disclosure statements; and a 
public comment process on the amendment of the irradiation labeling 
regulations. FDA's actions for each of these tasks is addressed below. 
As indicated, first priority was placed on the two irradiation tasks 
required by the statutory language of FDAMA.
    First, Congress mandated FDA to reach a timely decision on the 
petition to permit irradiation of meat. FDA issued its final decision 
on December 3, 1997, approximately two weeks after the enactment of 
FDAMA, which was well within the 60 days specified in the Act.
    Second, Congress established limits on the prominence of a 
radiation disclosure statement. To conform FDA regulations with the 
statutory language of FDAMA, on August 17, 1998, FDA issued a final 
rule that amended its regulations to ensure that the disclosure 
statement would not be presumed to be required to be more prominent 
than the ingredient statement.
    Last, the Conferees Report directed FDA to use the public comment 
process to provide an opportunity for the public to comment on whether 
the regulations should be amended further to revise the proposed 
nomenclature for the labeling of irradiated foods. The conferees gave 
general guidance, such as labeling should not be perceived as a warning 
or give rise to inappropriate consumer anxiety, but gave no specific 
instructions regarding how these objectives should be accomplished. On 
February 17, 1999, FDA published an advanced notice of proposed 
rulemaking soliciting comment on the appropriate labeling for 
irradiated foods. The comment period is open until May 18, 1999. FDA 
has not addressed the directive to consider whether the regulation 
should be revised since the comment period on the notice has not yet 
closed.
    Question. Under the Food, Drug and Cosmetic Act, irradiation is 
regulated as a food additive. Is this a necessary requirement in light 
of what we know today about this food processing technology?
    FDA/CDC answer. The legislative history for the Food Additives 
Amendment makes it clear that it is the equipment used to irradiate 
food, not the process of irradiation itself, that is regulated as a 
food additive. The various reports explicitly cite radioactive 
isotopes, particle accelerators and X-ray machines as the additives 
whose use is regulated. This was done to ensure that the safety of the 
process be established before it was used on food in commerce. At that 
time, the effects of radiation on food were not at all well understood.
    Food irradiation involves exposing a food to a source of ionizing 
radiation. It does not involve adding radioactive isotopes to food nor 
does it make food radioactive when the process is properly conducted 
under the limitations in FDA's regulations. The other important safety 
issues--chemical change, nutrient losses, and differential effects on 
different microorganisms--are important in all food processes. FDA has 
not evaluated in depth all possible applications of food irradiation. 
However, from what FDA has evaluated, nothing has been discovered that 
would distinguish irradiation from other processes.
    FDA recognizes that some expert bodies throughout the world have 
concluded that irradiation processing does not raise concerns different 
from other processing. Others have emphasized the need for close 
monitoring consistent with the caution in adopting any new technology. 
No expert body anywhere has concluded that irradiation is unsafe, but 
not all have endorsed it either.
    Certainly, as with the adoption of all new technologies, caution is 
needed to avoid making preventable mistakes. FDA can work to ensure 
safe application either through the current premarket approval route or 
by general oversight.
    Question. Dr. Henney, every year FDA comes before this Subcommittee 
with a presentation that generally includes a discussion of the 
agency's successes over the past year in reducing the time it takes the 
agency to review applications for foods, drugs, and medical devices. In 
order to help Subcommittee members more accurately compare the agency's 
performance in this regard from year to year, please provide answers to 
the following questions:
    In FDA's reports and statements to Congress over the last five 
years, has there been any change in the method (e.g., mean vs. median) 
FDA uses to measure the time it takes to review: food additive 
petitions; new drug applications; abbreviated new drug applications; 
510(k)s; premarket approval applications; new animal drug applications; 
and abbreviated new animal drug applications? If yes for any type of 
petition or application, please explain.
    FDA/CDC answer. Over the past five years, methods of measurement 
for most programs have changed only slightly. For the new drug and 
abbreviated drug applications, no changes have occurred. FDA has added 
a measurement of median times to the 510(k), premarket approval 
applications, new animal drug applications and abbreviated new animal 
drug applications. For those applications, averages are still measured 
and reported, but the Agency believes that the median can give a better 
representation of Agency performance in those cases in which outliers 
skew the mean. The median is a particularly valuable piece of data in 
program areas with a small number of applications.
    The Foods Program has altered its definition of the term first 
action in recent years. Historically, for food additive petitions, the 
Program has considered a first action to be when it notifies an 
applicant that a substantive deficiency has been noted, even if reviews 
of other parts of the application have not been completed. Thus there 
could have been multiple first action responses to a sponsor as reviews 
of additional parts of the application were completed. However, the 
Foods Program is now establishing performance goals for the timely 
review of a complete package, and is measuring timeliness of review of 
food additives from the date of receipt of a fileable petition to a 
complete first action as defined in the Foods Program performance 
goals. This measure started with the applications received in fiscal 
year 1998.
    In the Animal Drugs and Feeds Program, measures of performance are 
evolving to reflect the improved drug review process. The Program has 
significantly improved its review process by reviewing data submitted 
to the investigational new animal drug file prior to the filing of the 
new animal drug application. This allows the Agency to evaluate and 
comment on data as they are collected, as opposed to the earlier 
process of waiting until the sponsor developed and collected the 
entirety of the data at considerable expense before the FDA made an 
approval or deficient decision. In the old process, there was no chance 
to recognize and resolve an early critical deficiency, such one 
involving the effective dose, before other required work was done, such 
as other dose-dependent studies or developing and validating 
manufacturing processes. This new process has allowed the Agency and 
sponsors to interact more effectively so that sponsors can make 
necessary modifications to the drug development plan, based on the FDA 
evaluation of initial data submissions.
    The Agency currently working with its stakeholders to develop new 
measures or metrics that will satisfy both Agency and stakeholders' 
needs. These measures may replace traditional metrics that no longer 
are as valid in measuring the improved drug review process. This 
cooperative effort to develop more meaningful measures is being 
conducted in the spirit of the FDA Modernization Act. The new measures 
will also allow the Animal Drugs and Feeds Program to better fulfill 
its responsibilities under GPRA, because they are being developed to 
more appropriately measure outcome-based performance.
    Question. How does FDA currently define the term ``filing'' for: 
food additive petitions; new drug applications; abbreviated new drug 
applications; 510(k)s; premarket approval applications; new animal drug 
applications; and abbreviated new animal drug applications?
    FDA/CDC answer. For the Foods Program, regulations concerning the 
acceptance or nonacceptance of food additive petitions (filing) are 
laid out in the Code of Federal Regulations (21CFR 171.1). Filing of 
food additive petitions in the Animal Drugs and Feeds Program is 
defined in 571.1(I)(1). For both programs, upon receipt of an 
application, the information is examined to see if the petition 
requirements from the stature have been addressed. The petitioner is 
informed of the filing decision within 15 working days. If the petition 
is accepted for filing, the date of the notification letter to the 
sponsor becomes the date of filing, and a notice of the filing 
acceptance is published in the Federal Register.
    For new drug applications or abbreviated new drug application, the 
agency will determine if the application may be filed within 60 days of 
receipt. The filing of a new drug application, or NDA, or abbreviated 
new drug application, or ANDA means that FDA has made a threshold 
determination that the application is sufficiently complete to permit a 
substantive review.
    There is no definition of filing for 510(k)s. They are not filed, 
rather they are received by the agency and reviewed. For premarket 
approval applications, under 21 CFR 814.42, the filing of an 
application means that FDA has made a determination that the 
application is sufficiently complete to permit a substantive review.
    In virtually all cases of new animal drug applications and 
abbreviated new animal drug applications, the filing as defined in 
514.110 [a] is denoted by the date the application is initially 
received by the Document Control Unit of the Center. The only exception 
is for rare instances in which a sponsor withdraws an application 
before the Program's initial evaluation is complete, or the application 
is so deficient on its face that the Program retroactively refuses to 
file the application. In these cases, the filing date is that on which 
the application is resubmitted or reactivated.
    Question. In FDA's report and statements to Congress over the last 
five fiscal years has there been any change to FDA's definition for the 
term ``filing'' for: food additive petitions; new drug applications; 
abbreviated new drug applications; 510(k)s premarket approval 
applications; new animal drug applications; and abbreviated new animal 
drug applications? If yes for any type of petition or application. 
Please explain.
    FDA/CDC answer. There has been no change in the agency's definition 
of the term filing for food additive petitions; new drug applications; 
abbreviated new drug applications; 510(k)s or premarket approval 
applications in the past five fiscal years. The minor change in new 
animal drug applications and abbreviated new animal drug applications 
is in which a sponsor withdraws an application before the Program's 
initial evaluation is complete, or the application is so deficient on 
its face that the Program refuses to file the application. In those 
cases, the filing date is adjusted to the date on which the application 
is resubmitted/reactivated. This filing date adjustment was not used 
prior to 1997 and is rarely employed. This change in the definition of 
filing for this small number of applications makes the filing-to-
approval-time measure equivalent to the first-substantive-review-to-
approval measure.
    Question. How does FDA currently define the term ``review cycle'' 
for: food additive petitions; new drug applications; abbreviated new 
drug applications; 510(k)s; premarket approval applications; new animal 
drug applications; and abbreviated new animal drug applications?
    FDA/CDC answer. The review cycle has not been a metric the Agency 
has used to measure performance for food additive petitions, new animal 
drug applications or abbreviated new animal drug applications, so there 
is no definition of the term for those areas.
    A review cycle for a new drug application and an abbreviated new 
drug application begins when an application is filed by FDA and ends 
when the agency issues an action letter. Generally, these letters 
communicate to the sponsor that their application is approved or not 
approved. If not approved, the sponsor is provided with the reasons why 
and has an opportunity to submit information needed to address these 
deficiencies. When this information is received a new cycle begins.
    For 510(k)s, section 510(k) of the Federal Food, Drug and Cosmetic 
Act establishes a 90-day benchmark for the review of a premarket 
notification. In addition, 21 CFR 807.81(a) and 21 CFR 807.87(l) 
reference the 90-day benchmark for 510(k)s. If a final decision on the 
notification cannot be made on the basis of information supplied, it is 
placed on hold and a new 90-day review period (cycle) begins when the 
requested information is received. For premarket approval applications, 
section 515(d)(1)(A) of the Federal Food, Drug and Cosmetic Act 
establishes a 180-day benchmark for Agency action on a PMA. In 
addition, 21 CFR 814.37(c)(1) and 21 CFR 814.40 reference a 180-day 
review period, or cycle, for a PMA. A new 180-day review period, or 
cycle, begins when a major amendment containing significant new or 
updated data, detailed new analyses, or information previously omitted 
is received.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``review cycle'' for: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications? If yes for any type of petition or 
application, please explain.
    FDA/CDC answer. FDA has not changed the definition for the term 
review cycle over the last five fiscal years in any Program where 
review cycle is measured.
    Question. How does FDA currently define the term ``approval'' for: 
food additive petitions; new drug applications; abbreviated new drug 
applications; 510(k)s; premarket approval applications; new animal drug 
applications; and abbreviated new animal drug applications?
    FDA/CDC answer. The definitions of approval vary, often due to 
requirements of the statute. For food additive petitions under review 
by the Foods or Veterinary Medicine Programs, current law states that a 
food additive may be marketed only when a regulation for the food 
additive exists, specifying the conditions for safe use of the 
additive. Approval of a food additive petition occurs when a regulation 
authorizing the use of the additive is published in the Federal 
Register.
    For new drug applications and abbreviated new drug applications, a 
firm gains permission to market a product when an approval letter is 
issued.
    For 510(k)s, the term approval is not relevant. Under 21 CFR Sec.  
807.97, the 510(k) is a clearance and not an approval. A device for 
which premarket notification is submitted is found substantially 
equivalent to a legally marketed predicate device and a letter is sent 
to the applicant informing them of FDA's determination. The letter 
gives the applicant clearance to market the device.
    In the case of premarket approval applications, Section FD&C Sec.  
515(d)(1)(A)(I) states that FDA will issue an order approving a PMA if 
none of the grounds for denying approval apply specified in section 
515(d)(2) and 21 CFR 814.44(d)(1). FDA issues an order approving the 
application if there is reasonable assurance that the device is safe 
and effective for the intended use for the target population.
    For new animal drug applications and abbreviated new animal drug 
applications, approval is the status an application acquires when the 
drug product has been deemed safe and effective and the sponsor of the 
application is informed by letter and Federal Register notice that the 
application has met all of the requirements for approval under the FD&C 
Act.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition of the 
term ``approval'' for: food additive petitions; new drug applications; 
abbreviated new drug applications; 510(k)s; premarket approval 
applications; new animal drug applications; and abbreviated new animal 
drug applications? If yes for and type of petition or application, 
please explain.
    FDA/CDC answer. The use of the term approval has been consistently 
applied by FDA for food additive petitions, new drug applications, 
abbreviated new drug applications, 510(k)s and premarket approval 
applications in the last five fiscal years. However, a provision was 
established in the Food and Drug Modernization Act, or FDAMA, for the 
premarket notification of food additives that fit the definition of 
food contact substances, e.g., food packaging materials. If certain 
funding provisions of the Act are fulfilled, and the Premarket 
Notification Program for Food Contact Substances becomes operational, 
eligible substances may be lawfully marketed 120 days after submitting 
a notification, absent an objection by the Agency.
    For new animal drug applications and abbreviated new animal drug 
applications, there has been a change in the date some applications are 
considered approved. For an application to be considered approved, both 
the sponsor and the public have to be notified. The sponsor is notified 
in a letter of the Agency decision to approve, while the public is 
notified by publication of the information in the Federal Register. 
Because of recent changes in legislation, the Animal Drug Availability 
Act of 1996, some animal feed drugs are now considered approved as of 
the date of the letter to the sponsor and sponsors are not required to 
wait for Federal Register publication to market the drug.
    Question. How does FDA currently define the term ``mean'' 
concerning the review of: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications?
    FDA/CDC answer. FDA defines the mean as the sum of all values in a 
group of data, divided by the number of values. This definition is used 
across all program areas.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``mean'' concerning the review of: food additive petitions; 
new drug applications; abbreviated new drug applications; 510(k)s; 
premarket approval applications; new animal drug applications and 
abbreviated new animal drug applications? If yes for any type of 
petition or application, please explain.
    FDA/CDC answer. There has been no change in the agency's definition 
of the term mean in the last five fiscal years.
    Question. How does FDA currently define the term ``median'' 
concerning the review of: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications?
    FDA/CDC answer. FDA defines the median as the point in an ordered 
group of data at which half of the data falls above and half below. The 
median is the exact midpoint of the collected information. If the 
number of values is even, the median is the average of the two middle 
values.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been a change to FDA's definition for the 
term ``median'' concerning the review of: food additive petitions; new 
drug applications; abbreviated new drug applications; 510(k)s; 
premarket approval applications; new animal drug applications; and 
abbreviated new animal drug applications? If yes for any type of 
petition or application, please explain.
    FDA/CDC answer. There has been no change to FDA's definition for 
the term median in the last five fiscal years.
    Question. How does FDA currently define the term ``average'' 
concerning the review of: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications?
    FDA/CDC answer. FDA defines the term average as the sum of all 
values in a group of data, divided by the number of values. The terms 
mean and average are used interchangeably.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``average'' concerning the review of: food additive petitions; 
new drug applications; abbreviated new drug applications; 510(k)s; 
premarket approval applications; new animal drug applications; 
abbreviated new animal drug applications? If yes for any type of 
petition or application, please explain.
    FDA/CDC answer. No, there has been no change in the agency's 
definition of the term average in the last five fiscal years.
    Question. How does FDA currently define the term ``receipt'' for: 
food additive petitions; new drug applications; abbreviated new drug 
applications; 510(k)s; premarket approval applications; new animal drug 
applications; and abbreviated new animal drug applications?
    FDA/CDC answer. Across the Agency, there are only minor, technical 
variations in how the receipt of a petition or applications is defined. 
For food additive petitions, receipt is defined as the day the petition 
is logged in to the Office of Premarket Approval and an acknowledgment 
letter is forwarded to the petitioner on the day of arrival or the 
following business day.
    Receipt of a New Drug Application is considered to be when it is 
received by the agency and when it is accompanied by any required user 
fee payment, 5-day grace period, where applicable.
    Receipt of an abbreviated new drug application or ANDA is defined 
as when a sponsor or applicant physically submits an ANDA to the Office 
of Generic Drugs. Receipt is independent of the filing status of an 
ANDA.
    For 510(k) and premarket applications, FDA defines the term receipt 
as the date that a submission is received and date stamped in FDA's 
Document Mail Center. Similarly, the receipt of an animal drug 
application or abbreviated new animal drug application is considered to 
be when an application is received at the Document Control Unit of the 
Center for Veterinary Medicine and date stamped. Since processing of 
new submissions ceases for the day at 2:00 p.m., submissions received 
after 2:00 p.m. are stamped with the receipt date of the next business 
day.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``receipt'' for: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications? If yes for any type of petition or 
application, please explain.
    FDA/CDC answer. No, there has been no change to FDA's definition 
for the term ``receipt'' in reports and statements to Congress over the 
last five fiscal years.
    Question. How does FDA currently define the term ``overdue'' 
concerning the review of food additive petitions?
    FDA/CDC answer. In previous years, overdue petitions have been 
defined and reported as those pending before the agency for more than 
180 days after filing without any action taken on them by the Agency. 
However, approval of a food additive requires complete review of a 
petition, preparation and review of an order that specifies the 
regulation and lays out the basis for Agency's decision, and 
publication of the document in the Federal Register. Most commentators 
and stakeholders in the food additive petition review process have 
agreed that 180 days is an impractical timeframe to complete each of 
the steps in the process. Accordingly, the agency has begun using 360 
days after filing in its GPRA performance goals as the time period 
after which a petition would be considered overdue.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``overdue'' concerning the review of food additive petitions? 
If yes, please explain.
    FDA/CDC answer. In previous years, overdue petitions have been 
defined and reported as those pending before the agency for more than 
180 days after filing.
    Nevertheless, because approval of a food additive requires not only 
complete review of a petition, but also preparation and review of an 
order that specifies the regulation and lays out the agency's basis for 
its decision, and publication of the document in the Federal Register, 
most commentators and stakeholders on this process agree that 180 days 
is impractical. The agency has begun using 360 days in its GPRA 
performance goals for time to first action. In any future reporting, 
overdues calculated in terms of GPRA goals will be clearly defined and 
delineated.
    Question. How does FDA currently define the term ``completed'' 
concerning the review of new animal drug applications and abbreviated 
new animal drug applications?
    FDA/CDC answer. A submission involving a New Animal Drug 
Application (NADA) or Abbreviated New Animal Drug Application (ANADA) 
is completed when the Animal Drugs and Feeds Program has finished the 
review of the information contained, or referenced, in the submission 
and informed the sponsor by letter of its findings. A favorable letter 
regarding the final submission to an NADA or ANADA will reflect 
approval of the application.
    Depending on the information and data submitted, the application 
may be judged to be either approved or deficient. If the application is 
approved, then notification of the approval is sent by letter and 
subsequently published in the Federal Register and the drug may be 
marketed consistent with the conditions of approval. If deficiencies 
are found in the application i.e., the information submitted is 
inadequate to show the drug to be safe and effective, then the sponsor 
is notified of the deficiencies and can address these deficiencies and 
reactivate the application with that information. The Animal Drugs and 
Feeds Program will then review the reactivated application.
    Question. In FDA's reports and statements to Congress over the last 
five fiscal years, has there been any change to FDA's definition for 
the term ``completed'' concerning the review of new animal drug 
applications and abbreviated new animal drug applications? If yes, 
please explain.
    FDA/CDC answer. The definition of completed has not changed in the 
last five years.
    Question. How does FDA currently define the term ``processed 
original'' when describing new animal drug applications?
    FDA/CDC answer. The phrase processed original as used in the budget 
report is synonymous with the phrase original applications or simply 
originals in the context of original applications received, completed, 
or approved.
    Question. When and why did FDA start using the term ``processed 
original'' in agency reports and statements to Congress when describing 
new animal applications?
    FDA/CDC answer. In fiscal year 1999 the Animal Drugs and Feeds 
program revised the format for reporting program activity data in the 
Justification of Estimates for Appropriations Committees--President's 
Budget. Prior, to fiscal year 1999, data was not reported in a 
consistent manner. For example, we reported medicated Feed Applications 
Processed, New Animal Drug Application Submissions Received and 
Completed and Original New Animal Drug Applications Approved. In fiscal 
year 1999 we began reporting program workload and output as Received, 
Completed and Approved. Processed original is redundant and provides no 
meaning, therefore we will omit it in future documents.
    Question. How does FDA currently define the phrase ``FDA days-
approval'' concerning the review of premarket approval applications and 
premarket approval application supplements?
    FDA/CDC answer. FDA does not currently use the phrase FDA days-
approval. FDA reports several measures for PMAs that include average 
review time and average elapsed time to approval. FDA also reports 
three components of time-FDA, non-FDA and total time. The FDA portion 
is the number of days FDA took to review the application in the last 
review cycle that led to a final approval decision.
    Question. When and why did FDA start using the phrase ``FDA days-
approval'' concerning the review of premarket approval applications and 
premarket approval application supplements?
    FDA/CDC answer. FDA has not used the phrase FDA days-approval 
concerning the review of premarket approval applications and premarket 
approval application supplements.
    Question. How does FDA currently define the phrase ``FDA days-
clearance'' concerning the review of 510(k)s?
    FDA/CDC answer. FDA does not currently use the phrase FDA-days 
clearance concerning the review of 510(k)s. FDA reports several 
measures for 510(k)s that include average review time, and median 
review time. The review time for a 510(k) is the number of days FDA was 
reviewing the 510(k) from the day of receipt of the submission until 
the date of issuance of the substantially equivalent letter.
    Question. When and why did FDA start using the phrase ``FDA days-
clearance'' concerning the review of 510(k)s?
    FDA/CDC answer. FDA has not used the phrase FDA days-clearance 
concerning the review of 510(k)s.
    Question. How does FDA currently define the phrase ``review and act 
on'' concerning the review of abbreviated new drug applications?
    FDA/CDC answer. The phrase review and act on is defined by FDA as 
the examination of the chemistry data submitted in an ANDA and the 
communication with the sponsor or applicant that the ANDA is approved 
or disapproved. ANDA's that are disapproved are sent deficiencies in 
the form of not approvable or other types of letters.
    Question. When and why did FDA start using the phrase ``review and 
act on'' concerning the review of abbreviated new drug applications?
    FDA/CDC answer. The phrase ``review and act on'' originated with 
the implementation of PDUFA. The industry and Congress requested an 
affirmative statement to communicate the result of a review to the 
sponsor. The term and act on was added to review to meet this industry 
request. The phrase is meant to communicate both meeting the required 
time frame of the review as well as the result. Act on is defined as 
the issuance of a complete action letter after filing of an 
application. FDA issues three types of action letters: Approval 
letters, Approvable letters, and Not Approvable letters. The action 
letter, if it is not an approval, must set forth in detail the specific 
deficiencies, and, where appropriate, the actions necessary to place 
the application in a condition for approval. For the past few years FDA 
has used the phrase review and act on with non-PDUFA abbreviated new 
drug applications to communicate similar information to their sponsors.
    Question. Dr. Henney, this Committee has made it clear that we 
expect your agency to meet its statutory deadlines for review of all 
applications and petitions. However, we are also aware that resources 
are limited. For each type of application listed below, could you 
please provide the Committee with your best estimates of how much money 
and the number of FTEs the agency would need to meet 100 percent of its 
statutory deadlines for: food additive petitions; new drug 
applications; abbreviated new drug applications; 510(k)s; premarket 
approval applications; new animal drug applications; and abbreviated 
new animal drug applications?
    FDA/CDC answer. Preparing the FDAMA implementation plan made it 
quite apparent to us that FDA is responsible for managing a rather 
complex triad of statutory expectations regarding the performance of 
review processes. First, and perhaps foremost, the agency's FDAMA 
mission statement directs us to the intended outcome of a successful 
review process--promotion of the public health by ensuring the timely 
marketing of new regulated products. In addition to this results-
oriented goal, the statutory requirements for the FDAMA plan specify 
two enabling objectives. The first is to maximize the availability and 
clarity of information about the application review processes, and the 
second is to establish mechanisms for meeting the review time periods 
specified in the Act. The fiscal year 2000 budget request reflects our 
closely integrated approach to these three statutory requirements. 
Because of their confluence, it is not appropriate to develop separate 
cost estimates for the individual objectives.
    We are fortunate to have an extremely robust template for this 
triad of statutory expectations. Beginning with the design of the 
initial Prescription Drug User Fee Act in 1992, and as it was updated 
the FDA Modernization Act, FDA's drug and biologic review processes 
have been striving to ensure that safe and effective new products are 
actually available to the publicnot just reviewed--as quickly as 
possible. This results-oriented societal goal has effectively made FDA 
and sponsors of new products collaborators during the entire 
development process, as well as during the final review steps, to 
ensure that the maximum possible number of safe and effective products 
are commercialized as quickly as possible.
    The PDUFA results have given us a deeper understanding of the 
relationship between results measures, new product availability, and 
process measures, review timeliness. Measuring from the year before 
PDUFA in 1992, approval times for new drugs have been reduced by a 
year, clinical development times are two years quicker and the success 
rate, the percentage of applications approved, are up from less than 60 
percent to 85 percent now. Yet, review time, the statutory time 
interval, has only decreased by about 2 months from the median interval 
of 12.5 months in 1992. This apparent paradox can be explained by the 
benefits realized by sponsors from a more transparent process affording 
more effective pre-submission collaboration with FDA that results in 
quicker preparation of higher quality submissions that can be approved 
by FDA on the first try. In the reauthorization of PDUFA through 2002, 
the pharmaceutical industry focused its willingness to pay additional 
fees on further expanded FDA collaboration within the development 
process. Their projections for 2002 predict an overall drug development 
time that is a year faster, but only a small fraction of that time 
savings is expected from quicker review times. The industry's 
acceptance of review timeframes that are longer than statutory goals 
acknowledges the amount of work that must be done within the review 
process, and the desirability of resolving problems within the first 
review cycle rather than churn through multiple review cycles, even if 
each might be within the statutory timeframe.
    This collaborative approach that has effectively demonstrated its 
ability to ensure more timely access to the greatest number of safe and 
effective new products is evident in the fiscal year 2000 budget 
request for other FDA review processes. The President's specific 
funding requests for additional review capabilities in the device 
review process and the food additive process invite the sponsors of 
these submissions to collaborate with the agency, with both their 
energy and user fee funding, to achieve the jointly desired goal of 
more timely consumer access to new products. Looking forward, I believe 
the eventual level of funding for these FDA review processes will 
increase proportionally with the degree of industry confidence in the 
collaborative paradigm demonstrated by the success of PDUFA. This is 
necessarily an incremental process where initial commitments of 
industry collaboration and fee funding prove their worth in terms of 
quicker and more certain new product development cycles. Eventually, I 
believe full implementation of this new collaborative review paradigm 
will effectively achieve most of the regulatory review timeframes in 
the course of satisfying the broader FDAMA goals. However, I will not 
be surprised if this step-wise proof by experience in the various FDA 
product areas will suggest that some of the present statutory review 
timeframes are not the optimal intervals for realization of the broader 
FDAMA objectives.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
    Question. Any initiative such as the Food Safety Initiative, that 
crosses agency and departmental lines requires high levels of agency 
coordination and cooperation. What steps are being taken to ensure that 
all food safety activities are properly coordinated? Is there any one 
agency or person responsible for taking the lead on food safety 
activities? What steps are needed to improve communication and 
cooperation among the agencies?
    USDA answer. On August 25, 1998, the President, by Executive Order 
13100, established the President's Council on Food Safety. The purpose 
of the Council is to protect the health of the American people by 
preventing foodborne illness through improving the safety of the food 
supply by means of sciencebased regulation and well-coordinated 
investigation, inspection, enforcement, research, and educational 
programs. The Secretaries of Agriculture and of Health and Human 
Services and the Assistant to the President for Science and Technology/
Director of the Office of Science and Technology Policy serve as co-
chairs of the Council.
    The Council is charged with:
  --the development and periodic update of a comprehensive strategic 
        plan for food safety activities;
  --making recommendations to the President on how to implement the 
        comprehensive strategy and enhance coordination among Federal 
        agencies, State, local and tribal governments, and the private 
        sector;
  --advising federal agencies in setting priority areas for investment 
        in food safety and developing a coordinated food safety budget 
        for the administration; and
  --overseeing research efforts of the Joint Institute for Food Safety 
        Research.
    In recent years, we have made tremendous progress in strengthening 
ties among food safety agencies at all levels of government, industry, 
academia, and the public sharing a common public health mission and 
fulfilling that mission more effectively by continuing to build 
partnerships in so many food safety areas. The development of the 
comprehensive strategic plan for food safety and the development of 
coordinated food safety budgets under the guidance of the President's 
Council will be major steps in improving coordination and cooperation 
among agencies.
    FDA answer. Since the implementation of the Food Safety Initiative, 
with release of the ``Farm-to-Table'' plan in May, 1997, the food 
safety agencies have worked to coordinate activities in every area of 
the initiative. The Partnership for Food Safety Education was formed by 
the agencies, industry, states, and consumer groups, to mount a 
coordinated approach to changing consumers' food practices. 
Representatives of federal and state agencies joined to form the 
Foodborne Outbreak Response Coordinating Group, or FORCG, as a means of 
improving the response to foodborne outbreaks whether they are multi-
state outbreaks or occur at the state or local level, and improving 
consumer safe food practices. Interagency working groups were also 
formed to set up the Risk Assessment Consortium and to coordinate 
research planning.
    FDA, in a coordinated effort with CDC, USDA, and EPA, developed a 
joint research plan. The plan provides a broad, uniform, and 
complementary approach to research that is intended to fill critical 
gaps in our scientific understanding of foodborne illness. To further 
assure that there is a mutual understanding of the issues surrounding 
foodborne illness. FDA and USDA participate on the National Advisory 
Committee for Microbiological Criteria for Foods, or NAMCF. This 
committee discusses scientific issues and research program needs for 
pathogens that may wind up in or on foods. FDA and USDA have also 
cooperated in joint food safety training programs such as the recent 
training on the application of Good Agricultural Practices. In order to 
assure that consumers and others keep abreast of food safety 
initiatives, the participating agencies have sponsored and will 
continue to sponsor a series of food safety education conferences.
    On July 3, 1998, President Clinton directed the Department of 
Health and Human Services, DHHS, and the Department of Agriculture, 
USDA, to report back within 90 days with a plan to create a Joint 
Institute for Food Safety Research. The Institute is to coordinate 
planning and priority setting for food safety research among the two 
Departments, other government agencies, and the private sector and 
foster effective translation of research results into practice along 
the farm-to-table continuum. Enhanced and more efficient national 
investment in food safety research will do much to lower incidence of 
foodborne illness in the United States.
    DHHS and USDA will have joint leadership of the Institute and will 
use existing resources to support it. This acknowledgment of the 
critical need to expand and coordinate food safety research also 
emphasizes the companion needs to expand and strengthen public-private 
partnerships and to augment collaboration among state, local, and other 
Federal agencies, thereby providing effective scientific information 
required to help achieve public health goals.
    Likewise, Executive Order 13100 establishing the Food Safety 
Council has formalized interagency food safety budget planning and 
overall strategic planning. These processes are augmented by the 
numerous interagency working groups formed to coordinate food safety 
activities.
    Question. Is there any one agency or person responsible for taking 
the lead on food safety activities?
    FDA answer. No, no one person or agency has the lead or the 
responsibility on food safety activities. All the food safety 
agencies--FDA, CDC, USDA, and EPA--are working together, in a 
coordinated effort to achieve the goals of the Food Safety Initiative. 
The President's Food Safety Council released its response to the 
National Academy of Sciences, or NAS, report ``Ensuring Safe Food from 
Production to Consumption'' on March 15, 1999. One of the 
recommendations within the NAS report called for Congress to 
``establish by statute a unified and central framework for managing 
federal food safety programs, one that is headed by a single official 
and which has the responsibility and control of resources for all 
federal food safety activities . . .'' The Council strongly agrees with 
the goal of a unified framework for the food safety programs, while 
noting that there may be many organizational approaches to achieving a 
``single voice'' for federal food safety activities. The Council will 
conduct an assessment of structural models and other mechanisms that 
could strengthen the federal food safety system through better 
coordination, planning and resources allocation.
    Question. What steps are needed to improve communication and 
cooperation among the agencies?
    FDA answer. In the interests of solidifying interagency 
coordination and communication, numerous interagency committees have 
been formed with representatives ranging from the working level to the 
agency's senior decision makers. We believe that the strategic planning 
process, conducted by the Food Safety Council, will further solidify 
lines of communication between the agencies as they work together to 
develop the national food safety plan described in the Council response 
to the National Academy of Science's report Ensuring Safe Food.
    Question. I have been provided by the Food and Drug Administration 
a map of the United States which shows Food-Borne Disease Outbreaks 
from the period of January to July, 1998. I understand this map is 
based on information provided by the Centers for Disease Control and 
Prevention. This map indicates that some states with relatively low 
populations, such as Wisconsin and Kansas, have a large number of 
outbreaks compared to states with relatively high populations, such as 
Texas, Florida, and New York. What is the actual definition of a 
``Food-Borne Disease Outbreak''?
    USDA answer. The definition of a foodborne disease outbreak is the 
occurrence of two or more cases of a similar illness resulting from the 
ingestion of a common food.
    Question. Is the period shown on this map (January to July, 1998) 
representative of incidents of outbreaks generally?
    USDA answer. The period shown on the map--January to July 1998--is 
not representative of outbreaks, generally. Rather, it is probably more 
representative of the reporting of outbreaks to the CDC. Thus, the 
number of outbreaks in some States may be higher because they are more 
likely to report their outbreaks than other States.
    Question. I have been provided by the Food and Drug Administration 
a map of the United States which shows Foodborne Disease Outbreaks from 
the period of January to July, 1998. I understand this map is based on 
information provided by the Centers for Disease Control and Prevention. 
This map indicates that some states with relatively low populations, 
such as Wisconsin and Kansas, have a large number of outbreaks compared 
to states with relatively high populations, such as Texas, Florida, and 
New York.
    What is the actual definition of a ``Foodborne Disease Outbreak''?
    FDA answer. An outbreak is defined as an occurrence of 2 or more 
cases of a similar illness resulting from the ingestion of a common 
food. (MMWR V45, #SS-5, 10/25/96)
    FDA answer. The map illustrates outbreaks during that period of 
time; it is not generalizable to other time periods.
    Question. To the extent outbreaks were a problem in Wisconsin 
during the period shown on this map, what is FDA or any other agency 
doing to help control this problem?
    USDA answer. FSIS staff is available to help investigate plants 
that may be associated with foodborne illness in Wisconsin at the 
request of the Wisconsin state epidemiologist. This is usually done in 
collaboration with the local health department and CDC. FSIS assisted 
Wisconsin in this fashion once during 1998.
    FDA answer. In general, CDC supports strengthening states' ability 
to detect and investigate outbreaks of foodborne illness through 
enhanced surveillance capacity.
    Wisconsin is sophisticated in laboratory methods and epidemiology, 
with the aid of Epidemiology and Laboratory Capacity (ELC) cooperative 
agreements and as a member of PulseNet. The result of epidemiologic 
sophistication is better surveillance, which leads to better and more 
accurate disease detection. It is important to note that the outbreaks 
in Wisconsin illustrated by the map are the result of techniques that 
have allowed for detection of widely dispersed outbreaks and small 
clusters that would have previously been missed. FDA or USDA will 
investigate those outbreaks that involve regulated products under their 
corresponding jurisdictions. A renewed Memorandum of Understanding, or 
MOU, between the two agencies was signed in February 1999 that will 
facilitate enhanced exchange of information at the field level about 
food establishments and operations that are subject to the jurisdiction 
of both agencies. Most foodborne outbreaks involve mishandling at the 
point of preparation and/or two products that would have traveled in 
intrastate commerce. In such cases, the state public health agencies 
would respond at the state or local levels, as appropriate. States that 
show an apparent disproportionately large number of outbreaks, most 
likely indicate more active surveillance investigation and reporting by 
the State and public health agencies. In general, FDA and CDC support 
strengthening states' ability to detect and investigate outbreaks of 
foodborne illness through enhanced surveillance capacity. Specifically, 
Wisconsin's state public health agencies are sophisticated in 
laboratory methods and epidemiology, with the aid of Epidemiology and 
Laboratory Capacity, or ELC, cooperative agreements and as a member of 
Pulsenet. The result of epidemiologic sophistication is better 
surveillance, which leads to better and more accurate disease 
detection. It is important to note that the outbreaks in Wisconsin 
illustrated by the map are the result of techniques that have allowed 
for detection of widely dispersed outbreaks and small clusters that 
previously would have been missed.
    Question. Last year, USDA began implementation of the Hazard 
Analysis Critical Control Point (HACCP) program for large meat and 
poultry processing plants both in the United States and foreign 
countries who export to the U.S. Earlier this month, similar programs 
were implemented for small firms both here and abroad. Although the 
inspection programs in foreign countries do not have to be identical to 
those in the U.S., they must be equivalent. What changes have occurred 
in the safety of meat and poultry products from foreign nations since 
the implementation of HACCP? How has implementation of HACCP in foreign 
plants compared to implementation in U.S. plants?
    USDA answer. For the record, the following chart summarizes the 
status of eligible foreign countries with regard to the implementation 
of HACCP Sanitation Standard Operating Procedures (SSOPs) and generic 
E. coli testing. FSIS is in the process of its review of the 
implementation of HACCP and Salmonella testing in eligible foreign 
countries.
    [The information follows:]

                                  STATUS OF PR/HACCP EQUIVALENCE DETERMINATIONS
----------------------------------------------------------------------------------------------------------------
                                                                   SSOP and E. coli Testing
                                             -------------------------------------------------------------------
                                                                                                  Was data/info.
           COUNTRY              1998 Import    ``Identical''      Alternate                      received and NO
                                  Volume       SSOP & E. coli      Sanitary      Were Measures     equivalence
                                                  Testing?        Measures?       Equivalent?     determination
                                                                                                      made?
----------------------------------------------------------------------------------------------------------------
Argentina...................      73,718,507  Yes............  No.............  ...............  No
Australia...................     706,370,059  Yes............  Yes............  No \1\.........  No
Austria.....................           7,291  Yes............  No.............  ...............  No
Belgium.....................      10,479,587  Yes............  No.............  ...............  No
Brazil......................      69,991,833  Yes............  No.............  ...............  No
Canada......................   1,413,660,410  Yes............  No.............  ...............  No
Costa Rica..................      19,750,003  Yes............  No.............  ...............  No
Croatia.....................       2,013,764  Yes............  No.............  ...............  No
Czech Republic..............  ..............  SSOP--yes E.     No.............  ...............  Yes, more E.
                                               coli--see. This campaign 
covers all aspects of food safety, including information that pertains 
to safe handling of eggs.
                            national center
    National Center (directed to FDA).--The National Center for Food 
Safety and Technology located at the Illinois Institute of Technology 
near Chicago is a research and development facility that supports the 
FDA in its mission to ensure the safety of food products other than 
meat and poultry. It is a ten year old collaboration between the 
Federal government, private business, and academia. It relies on FDA 
funding to help address the growing incidence of food borne epidemics.
    Question. What role do you see the National Center playing in the 
President's Food Safety Initiative?
    FDA answer. Most of the cooperative research projects currently 
underway at the National Center for Food Safety and Technology, or 
NCFST, are part of the overall Food Safety Initiative. The academic/
government/industry consortium at the NCFST presents a unique 
opportunity for examination and resolution of food safety issues, 
development of measures to prevent food contamination, and 
implementation of those measures by the food industry.
    NCFST will continue to play a major role in the Food Safety 
Initiative. NCFST resources that are available to the FDA include the 
use of food processing and analytical equipment, research facilities 
such as a special containment pilot plant for study of pathogens under 
actual processing conditions, and the scientific expertise of the 
universities and industry scientists at the NCFST.
    FDA would be happy to provide for the record some of the recent 
accomplishments by the Center:
    [The information follows:]
   food and drug administration national center for food safety and 
                       technology accomplishments
    Developed a test for rapidly detecting E. coli O157:H7 in foods. 
This procedure is currently being used in the food plants to improve 
food safety.
    Organized a sprout safety task force with the International Sprout 
Growers Association to develop techniques for improving the safety of 
sprouts. Sprouts have been implicated in several foodborne illness 
outbreaks.
    Formed a task force of 20 leading industry partners to obtain FDA 
approval of specific polymer packaging to be used with in-package 
irradiated foods. These packages will be used to protect red meats and 
poultry from contamination after they have been irradiated.
    Contributed to the development of a high pressure process to make 
raw oysters safe to eat by eliminating Vibrio vulnificus bacteria. This 
is a new technology that, conceivably, may be accessible to small 
businesses and retail establishments in the future.
    Conducted research to validate high pressure and ultra-violet light 
processes to kill pathogens in fresh fruit juices [on-going]. Once this 
research is finished, the processes may be very useful to small 
businesses.
    Question. Do you envision any of that increase going to the 
National Center?
    Answer. Based upon FDA's past experience, the Agency may 
temporarily increase funding to NCFST to supplement planned research 
projects. When FDA originally formulated its' $3.7 million request for 
research, the Agency did not incorporate an expansion of activities for 
NCFST. However, since the NCFST is central to the FDA's research 
activities aimed at developing and evaluating techniques to prevent 
food contamination, FDA may direct resources to the Center for support. 
In fiscal year 1998, FDA expended an additional $175,000 on two major 
research projects that helped address the growing incidence of 
foodborne epidemics.

                          SUBCOMMITTEE RECESS

    Senator Cochran. Well, let me thank all of you for your 
participation in our hearing today. I think it has been an 
excellent hearing focusing on the budget request to deal with 
the problems of food safety in our country. We will give this 
request very careful attention, and also the legislative 
proposals that are pending in the Senate, to make the process 
more efficient and more effective.
    [Whereupon, at 11:24 a.m., Tuesday, March 16, the 
subcommittee was recessed to reconvene at 9:30 a.m., Tuesday 
April 27.]
                       DEPARTMENT OF AGRICULTURE

             Office of the Under Secretary for Food Safety

STATEMENT OF CATHERINE E. WOTEKI, UNDER SECRETARY FOR 
            FOOD SAFETY
ACCOMPANIED BY:
        DR. EILEEN KENNEDY, DEPUTY UNDER SECRETARY FOR RESEARCH, 
            EDUCATION AND ECONOMICS
        TOM BILLY, ADMINISTRATOR, FOOD SAFETY AND INSPECTION SERVICE
        DR. ENRIQUE FIGUEROA, ADMINISTRATOR, AGRICULTURAL MARKETING 
            SERVICE
        DENNIS KAPLAN, DEPUTY DIRECTOR, OFFICE OF BUDGET AND PROGRAM 
            ANALYSIS

                     STATEMENT OF CATHERINE WOTEKI

    Senator Cochran. Dr. Woteki, you may proceed.
    Dr. Woteki. Thank you, Mr. Chairman and members of the 
subcommittee. I am pleased to appear before you today with my 
colleagues from the Department of Health and Human Services to 
discuss the President's food safety initiative and the fiscal 
year 2000 budget for food safety.
    I am going to be emphasizing our request within the 
Department of Agriculture, as well as talking more broadly 
about the President's Food Safety Initiative. And because the 
food safety activities within the Department of Agriculture are 
really dispersed among seven different agencies, there are 
several people who are here with me today that I would like to 
introduce to the subcommittee.
    Dr. Eileen Kennedy, who is the Deputy Under Secretary for 
Research, Education and Economics, oversees four of those 
agencies; Mr. Tom Billy, the Administrator of the Food Safety 
and Inspection Service; and Dr. Enrique Figueroa, who is 
Administrator of the Agricultural Marketing Service.
    We very much appreciate that copies of our written 
testimony will be inserted into the record. And I will then 
briefly summarize that testimony.
    But before I begin that, I would like to thank you and the 
members of the subcommittee for looking favorably on the 
administration's request last year for the President's Food 
Safety Initiative and also for the department's fiscal year 
1999 budget requests as they related to agencies that support 
our food safety efforts. The funding has helped us to make some 
very substantial progress that is more fully discussed in the 
written testimony.

                   PRESIDENT'S FOOD SAFETY INITIATIVE

    I would like now to turn to the President's Food Safety 
Initiative. The fiscal year 2000 budget request is, as Dr. 
Henney indicated, the third year that the administration has 
submitted a coordinated request to maximize the use of our 
resources toward achieving improvements in the safety of the 
food supply.
    The request builds on the strategy outlined in the May 1997 
report to the President that was entitled, ``Food Safety from 
Farm to Table, a National Food Safety Initiative.''
    Now the coordinated activities that we have undertaken 
through the initiative have greatly enhanced the capacities of 
both the States, as well as the Federal Government, to better 
monitor the incidence of specific foodborne diseases, to more 
rapidly respond when there are outbreaks of these illnesses, 
and, we hope, to diminish future outbreaks, to identify 
foodborne hazards that pose the highest public health risk, and 
also to direct resources to minimize those risks and, lastly, 
to develop education programs aimed at improving food safety 
practices and therefore improve food safety for Americans.
    The FightBAC! TM campaign is an example of one 
of those activities undertaken under the initiative. As you can 
see from the poster here, it includes four very simple messages 
for consumers. The messages were actually developed through a 
public-private partnership.

                        INTER-AGENCY COOPERATION

    The agencies represented at the table here, the Centers for 
Disease Control, the Food and Drug Administration, the 
Department of Agriculture, as well as the Department of 
Education, all participated in the development of this 
campaign, along with industry and representatives of consumers.
    We believe that the investment in the initiative is already 
paying off. FoodNet monitoring of foodborne illnesses and the 
PulseNet DNA fingerprinting technologies have already been 
used, as Dr. Koplan described, to monitor as well as to 
initiate actions in response to foodborne outbreaks of disease.
    We have also established a foodborne outbreak response 
coordination group, in which USDA agencies, the Food and Drug 
Administration and the Environmental Protection Agency have 
been working closely with States to develop better procedures 
to respond to foodborne disease outbreaks.
    The Food Safety Inspection Service and the Food and Drug 
Administration have recently signed a memorandum of 
understanding to share information gained from inspections in 
food plants for which both agencies have regulatory 
responsibilities.
    These are just a few examples of the payoff from the Food 
Safety Initiative's emphasis on cooperation and on partnerships 
to further improve the safety of the Nation's food supply; but 
these are all works in progress.
    We anticipate the continued emphasis on investment in these 
areas, such as research coordination through the Joint 
Institute for Food Safety Research, will continue to pay 
dividends in enhanced safety of the food supply.
    This last initiative, the Joint Institute for Food Safety 
Research, is another example of cooperation among and between 
the agencies. In this case, this activity is being co-chaired 
by Dr. Kennedy for the Department of Agriculture and Dr. Bill 
Raub for the Department of Health and Human Services.

                   PRESIDENT'S COUNCIL ON FOOD SAFETY

    While much progress is being made, we recognize that there 
is also room for further improvement. That is why last August 
President Clinton established a Council on Food Safety to 
develop a comprehensive strategic plan for federal food safety 
activities and to make recommendations to the President on how 
to implement the plan.
    The President also directed the council to assess the 
findings and recommendations of the National Academy of 
Sciences for scientific and organizational changes needed to 
ensure an effective food safety system in the United States. 
The council's response was released yesterday. And it supports 
all the goals contained in the academy's recommendations to 
strengthen the food safety system. The council has already 
begun to develop a strategic plan and to coordinate the 
development of food safety budgets.
    As part of its work, it will review food safety statutes 
and focus on areas where regulatory efforts can be strengthened 
or where jurisdiction is split between agencies and where 
resources could be more effectively shared between agencies.

      SAFE AND FAIR ENFORCEMENT AND RECALL OF MEAT AND POULTRY ACT

    The administration will work with Congress to pass the Safe 
and Fair Enforcement and Recall of Meat and Poultry Act that 
Senator Harkin introduced this session.
    This act would fill one of the gaps identified by the 
academy report and strengthen the authorities of the Department 
of Agriculture in three key areas. These are notification, 
recalls, and civil penalties.

                    FISCAL YEAR 2000 BUDGET REQUEST

    With respect to the Food Safety Initiative's budget request 
for fiscal year 2000, six of USDA's agencies are requesting a 
total of $151 million to support the President's Food Safety 
Initiative. This request is an increase of $34.8 million over 
the fiscal year 1999 level.
    The initiative budget for the Food Safety and Inspection 
Service includes increases in the amount of $2.9 million to 
address food safety risks in three critical areas. The first is 
emergency coordination with the states in investigating 
foodborne illness outbreaks.
    The second is validation of the ability of State 
laboratories to meet pathogen testing requirements; and the 
third is pathogen testing in Federal laboratories of State-
inspected meat and poultry products.
    The budget request for research, education, and economics 
includes increases in the amount of $25.7 million that would 
support the work that is done by all four agencies within that 
mission area.
    These include such areas as research on the development of 
new pathogen intervention technologies, particularly 
emphasizing the pre-harvest level; research that will lead to 
better understanding of how the use of antibiotics in food-
producing animals increases the risk of emergence of micro-
organisms that are resistant to specific antibiotics; emphasis 
on integration of research and education activities in food 
safety for producers as well as for the general public; and 
also the conduct of economic analyses necessary to evaluate the 
effectiveness of various risk reduction strategies that are 
under consideration for further reducing foodborne illness.
    The sixth agency represented in the President's initiative 
within the Department of Agriculture for fiscal year 2000 is 
the Agricultural Marketing Service. Their request is for $6.2 
million to establish microbiological baselines for pathogens in 
fruits and vegetables.
    Particularly for these agencies in REE and AMS, these 
research and education and survey activities are supportive of 
both the Food and Drug Administration's and the Food Safety and 
Inspection Service's regulatory missions. They are also 
responsive to the needs of producers and processors.
    I would like to turn now to talk specifically about the 
Food Safety and Inspection Service's accomplishments. I would 
like to very briefly summarize them, as well as their budget 
request.

                          HACCP IMPLEMENTATION

    In January of this year, we reached another milestone. At 
that date over 2,500 large and small plants that account for 92 
percent of meat and poultry production were operating under the 
new HACCP system, the Hazard Analysis Critical Control Points 
approach.
    The agency recognized from the very beginning that small 
plants, which had to reach this goal in January of this year, 
those that employed between 10 and 499 employees, that they had 
fewer resources to draw on than large plants. Because of this, 
we prepared for implementation of the rule in the small plants 
by providing extensive technical assistance. [Chart.]
    This chart shows what we believe, that HACCP implementation 
is a success. In January of a year ago, the large plants, those 
that employed more than 500, which are shown on the left and 
numbered approximately 300 plants, implemented this system; 274 
of those plants were fully successful in their HACCP 
implementation. Regulatory actions were taken in 26 plants.
    For the small plants, those employing between 10 and 499 
employees--those are shown in the second set of bars--there 
were, 2,198 that were fully successful in implementation of 
HACCP. And regulatory actions were taken in 13 cases.
    In order to arrive at this successful implementation, the 
agency, as well as the organizations and the plants themselves, 
had to undertake a lot of activities. FSIS provided technical 
assistance through a variety of different means. We appointed a 
national HACCP small plant coordinator, established a network 
of contacts and state coordinators, and conducted small plant 
demonstration workshops throughout the country.
    The agency encouraged large plants to act as sponsors for 
the small plants, in order to help them develop their HACCP 
plans. And many, many of these large plants did step up and do 
that.
    The agency, in addition, held a series of 20 meetings 
around the country to answer questions from the small plant 
owners and managers. Each field supervisor made personal visits 
to each plant to assist in their preparations for HACCP 
implementation.
    So these are just some examples of the extensive outreach 
activities that the agency undertook. I think an enormous 
amount of credit also goes to the plants themselves, the 
companies, as well as to their trade associations, and to the 
universities that worked extremely hard to provide assistance 
and training to the members, as well as to the small plants.
    The very smallest of the meat and poultry plants, those 
that employ less than ten people, will need to implement HACCP 
in January of 2000. FSIS is planning to continue these outreach 
activities and is committed to ensuring a smooth transition for 
these very smallest of plants.
    A year ago there were a lot of questions that were raised 
about whether HACCP would really work; and I think that we can 
tell you now that we have answers to those questions. New data 
from the first year of testing in large plants show that the 
prevalence of Salmonella in broilers, swine and ground beef and 
ground turkey was substantially lower after HACCP 
implementation than in the baseline studies conducted before 
implementation. [Chart.]
    If you look at the chart on the top, for those four 
categories of products, the first column of numbers are the 
baseline prevalence levels for Salmonella in these four types 
of products. You can see in the second column the one year's 
data of performance testing for Salmonella in these four 
categories of products, that there have been declines in the 
range of 50 percent for broilers and a quarter to a third for 
the other three categories of products.
    These data indicate that the Administration's science-based 
inspection system has already had a significant effect on the 
safety of food that American families eat by reducing the 
prevalence of Salmonella in these types of products.
    Dr. Koplan has described the new data that are available 
from the FoodNet surveillance system that also indicate 
parallel declines in human illnesses attributable to 
Salmonella.
    I am also pleased to indicate that the compliance with the 
requirements of the rule has also been excellent. This second 
chart, the one on the bottom, shows that 88 percent of large 
plants with completed sample sets are actually meeting the 
government's Salmonella standard. We have similarly high 
compliance data for the remainder of the requirements of the 
rule.
    Those establishments that are not meeting or that did not 
meet the standards were required to take immediate corrective 
actions. The agency also has throughout this first year of 
implementation, and will continue in the future, to publish 
quarterly enforcement reports so that the public can follow the 
progress on HACCP implementation.

                  FISCAL YEAR 2000 FSIS BUDGET REQUEST

    Now with respect to FSIS's budget request, the budget for 
fiscal year 2000 proposes a program level of $742 million, of 
which $653 million would be appropriated under current law. 
This is a net increase of $36 million over the 1999 current 
estimate.
    The 2000 budget includes increases for pay costs to meet 
our statutory obligation to provide inspection services and 
also a programmatic increase to implement our farm-to-table 
food safety strategy.
    The request also provides funding for the staffing and 
operations of the Office of the U.S. Manager for the Codex 
Alimentarius. The Food and Drug Administration, the Centers for 
Disease Control, the Environmental Protection Agency and the 
Department of Commerce, along with USDA agencies, all 
participate in and also support the U.S. Codex activities.
    The 2000 budget includes increases to help the Food Safety 
and Inspection Service's inspection workforce make the 
transition to a new HACCP environment, including conversion of 
638 inspection positions to consumer safety officer positions.
    In these new positions, our employees will be responsible 
for conducting scientific testing and inspections in plants and 
also in product distribution. Some of these personnel will be 
deployed to cover critical inspection vacancies in the nearly 
3,400 very small establishments that will be coming under HACCP 
in January of next year.
    In the near future, we will be transmitting to Congress the 
legislation necessary to support the 2000 budget proposal to 
recover the full cost of providing Federal meat, poultry, and 
egg products inspections through user fees. The user fees 
exclude grants to States and special assistance for State 
programs.
    The overall impact on prices as a result of these fees has 
been estimated to be less than a cent per pound of meat, 
poultry, and egg products production.
    The implementation of the user fee authority would be 
designed to be fair and equitable, promote accountability and 
efficiency and minimize the impact on the competitive balance 
among affected industries. Appropriated funds are requested to 
convert the program, the Federal program, to user fees and also 
for maintaining State inspection programs.
    Mr. Chairman, members of the subcommittee, I again thank 
you for the opportunity to appear before you today, 
representing the seven agencies in USDA with direct and 
supportive roles for food safety, and also to discuss with you 
the administration's goals to enhance food safety. We certainly 
look forward to working with you.

                           PREPARED STATEMENT

    My colleagues and I are happy to answer any questions that 
you may have.
    [The statement follows:]
               Prepared Statement of Catherine E. Woteki
    Mr. Chairman and Members of the Subcommittee, I am pleased to 
appear before you today to discuss the President's Food Safety 
Initiative and fiscal year 2000 budget for Food Safety within the 
Department of Agriculture.
    Before I begin, I would like to thank you for looking favorably on 
our fiscal year 1999 budget request. This funding has helped us make 
progress in fulfilling our Federal responsibilities of maintaining a 
safe food supply while we continue to make improvements in food safety 
research and in the inspection of meat, poultry, and egg products.
                       usda food safety overview
    USDA has adopted a farm-to-table approach for improving food 
safety. The farm-to-table approach views agricultural production, food 
processing, and food retailing as integrated and interdependent 
systems. Consequently, actions taken to reduce foodborne hazards must 
be directed across the food production, distribution, and consumption 
continuum rather than focused on any individual component. However, our 
farm-to-table strategy recognizes that our statutory authorities limit 
regulatory oversight and enforcement to prescribed areas. Therefore, 
our strategy relies upon voluntary adoption of quality control programs 
at the production level, and partnership with States, the private 
sector, and research and education agencies to strengthen the base for 
such voluntary programs.
Reorganization
    Much has been said about the need for organizational and structural 
change and improved coordination in the Federal government's food 
safety system. The Administration has been actively engaged in 
organizational and program changes to improve coordination and 
eliminate conflicts, enhance coordination of responses to public health 
issues and emergencies, and coordinate research planning and 
prioritization.
    Office of the Under Secretary for Food Safety: In 1994, the 
Congress and Administration cooperated in enacting a major 
reorganization of food safety within USDA, creating the new mission 
area and Office of the Under Secretary for Food Safety, which oversees 
the Food Safety and Inspection Service (FSIS) and the U.S. Manager of 
Codex Alimentarius. Under that legislation, a mission area dedicated to 
public health was created within USDA, and the legislation mandated 
that this office be occupied by an individual with a proven background 
in public health and safety.
    This action also effectively eliminated what had appeared to some 
as a conflict of interest by separating the food safety and regulatory 
function from marketing functions related to agricultural products, two 
mission areas that had previously been housed together within the 
Department.
    The Food Safety and Inspection Service: FSIS, which is the USDA 
regulatory agency reporting to the Under Secretary for Food Safety and 
is responsible for the safety of meat, poultry, and egg products, also 
underwent a major reorganization. Among its most significant features 
were the establishment of a more efficient field organizational 
structure and the establishment of a new Office of Public Health and 
Science to provide scientific focus, leadership, and expertise to 
address the most important public health risks related to meat, 
poultry, and egg products.
Codex Alimentarius
    Codex Alimentarius is the major international mechanism for 
encouraging fair international trade in food while promoting the health 
and economic interests of consumers. Management of Codex Alimentarius, 
which coordinates U.S. activity in Codex, is aimed at establishing 
international uniformity in food safety standards. Over the last year, 
I chaired a new Codex Steering Committee, which includes both policy 
and technical groups and has an expanded membership involving 
additional Federal Agencies including: the Departments of State and 
Commerce, the Office of the U.S. Trade Representative (USTR), 
Environmental Protection Agency (EPA), Food and Drug Administration 
(FDA) and Centers for Disease Control (CDC), and USDA agencies. We are 
pleased that the Administrator of FSIS is a vice chair of Codex 
Alimentarius and that he brings his public health experience to this 
international organization.
Office of the Under Secretary for Research, Education and Economics
    The 1994 reorganization of USDA centralized research activities in 
the newly created mission area of Research, Education and Economics 
(REE). Food safety research is largely funded through two USDA 
agencies: the Agricultural Research Service (ARS) and the Cooperative 
State Research, Education and Extension Service (CSREES). Together in 
fiscal year 1998 the REE agencies conducted and funded about $64 
million in food safety research. The centralized research focus enables 
the Department to better leverage appropriated funds.
    The REE research activities are intended to meet the needs of the 
regulatory agencies to achieve improved food safety through HACCP 
implementation and other initiatives. To that end, ARS, the intramural 
research arm of USDA, and FSIS have yearly food safety and research 
budget and planning sessions. These sessions provide one mechanism to 
ensure that proposed research initiatives address the specific 
priorities of FSIS. In addition, FSIS consults closely with other USDA 
agencies to ensure that its critical research and information needs are 
being met.
    In fiscal year 2000, ARS will conduct pre-harvest food safety 
research to study animal pathogen resistance to antibiotics, study 
pathogen infestation in animal waste, and examine the risks associated 
with transmission of zoonotic pathogens from animals to humans. ARS 
will also conduct post-harvest research to enhance detection and 
measurement of microbial pathogens during the handling, distribution, 
and storage of fresh fruits and vegetables to determine the sources of 
contamination and risks of disease transmission, an effort which will 
provide important information to producers and, of course, to the 
Department of Health and Human Services (HHS).
    CSREES supports food safety research via several funding 
mechanisms--formula funds, National Research Initiative competitive 
grants, special research grants awarded by a competitive process, and 
special site-specific grants that are appropriated by Congress. For 
example, in fiscal year 2000 CSREES will provide the necessary training 
to small retail establishments in helping them to implement HACCP. 
CSREES will also administer competitive grants for food safety-related 
projects.
    The Economic Research Service (ERS) collaborates with other Federal 
and USDA agencies to assess the costs of foodborne illness and the 
economic implications of different options to improve food safety.
President's Food Safety Initiative
    For the third consecutive year, USDA and the Department of Health 
and Human Services (HHS) have coordinated the President's Food Safety 
Initiative to protect the health of the American public by improving 
the safety of the Nation's food supply. Through joint planning, we are 
maximizing the use of our resources and achieving substantial 
improvements in food safety. This process began with the May 1997 
report to the President, entitled, Food Safety from Farm-to-Table: A 
National Food Safety Initiative. The report recognized foodborne 
illness as an emerging public health hazard that required aggressive 
government action, identified critical gaps in the food safety system 
for controlling or eliminating foodborne pathogens from the food 
supply, and proposed a strategy for closing those gaps.
    Both USDA and HHS have focused on building a strong, scientific 
foundation for a farm-to-table food safety system. The coordinated 
activities have greatly enhanced the capacities of the States and the 
Federal government to better monitor the incidence of specific 
foodborne diseases, rapidly respond to outbreaks of foodborne illness 
and diminish future outbreaks, identify foodborne hazards that pose the 
highest public health risks and direct resources to minimize those 
risks, and develop education programs aimed at improving safe food 
practices and therefore, food safety for Americans.
    The 1999 initiative is building on gains made in these areas, and 
places increased emphasis on ensuring the safety of domestic and 
imported fresh produce and imported foods, targeting retail food safety 
education, transforming traditional meat and poultry inspection systems 
to science-based HACCP systems, and developing scientific information 
and tools to control a greater range of food safety hazards. 
Significant gains have already accrued with direct benefits to the 
public health. I'd like to share some of these achievements with you.
    The PulseNet (DNA fingerprinting) and FoodNet (monitoring of 
foodborne illness) technology has already been used in several 
instances to reduce foodborne outbreaks. State and Federal health 
officials used PulseNet data to detect and limit the size of foodborne 
illness outbreaks in products such as alfalfa sprouts, mesclun lettuce 
mix, ground beef, cheese curds, and Salmonella Agona in cereal.
    The most recent Listeria monocytogenes outbreak was also detected 
from widely dispersed reports of incidences of patient illness. It was 
tracked by fingerprinting and traced to one source--a meat products 
plant. In the past, such a geographically scattered outbreak would have 
continued for months longer. Therefore, while we are saddened by the 
results of the outbreak, we are pleased that the system worked to halt 
shipment of even more potentially contaminated products and resulted in 
a sharp decline in illness following the company's voluntary recall.
    While we cannot quantify the number of illnesses prevented, by 
identifying outbreaks and taking appropriate regulatory actions and 
public notifications much earlier than we otherwise would have, we 
believe that the number of potential illnesses in these particular 
cases was substantially reduced.
    FoodNet sites identified Campylobacter as the most common cause of 
foodborne disease, although it has rarely caused outbreaks of illness 
since the 1980s. These findings led to new interagency efforts in 
research and surveillance to better understand how this pathogen enters 
the food chain and how to control it. Within FoodNet, there are now 
special studies to determine which foods and behaviors are associated 
with Campylobacter, E. coli O157:H7, and some Salmonella.
    We're also working very hard on our outreach program to consumers. 
In 1996, the Secretaries of USDA, HHS, and Education along with 
industry, consumer groups, and public health officials, established the 
Partnership for Food Safety Education. This public-private partnership 
was established in order to promote safe food practices. The 
Partnership also developed the ``Fight BAC!'' character to promote 
consumer safety practices. The life-size ``BAC'' character and ``BAC'' 
puppets are used to deliver food safety messages to adults and school 
age children. More than 100 national, State, and local organizations 
from the public health, government, consumer, and industry sectors 
support the ``FIGHT BAC!'' campaign and disseminate education 
materials. These ``BAC Fighters'' will maximize the campaign's national 
outreach and provide important links into thousands of communities 
nationwide.
    We have also worked with the States to develop a website that links 
all food safety agencies--at the Federal, State, and local level--
together. The ``Gateway to Government Food Safety Information'' website 
can be accessed at www.foodsafety.gov.
President's Council on Food Safety
    In August 1998, the President issued an Executive Order creating 
the Council on Food Safety. Throughout 1999, the Council, co-chaired by 
the Secretaries of Agriculture and Health and Human Services, the 
President's Science Advisor, and the Head of the Office of Science and 
Technology Policy, will work to meet the President's goal of developing 
a comprehensive food safety strategy and coordinating food safety 
budgets that will result in further improvements in the safety of the 
food supply and will ensure the most effective use of Federal 
resources.
    The strategic plan will take into consideration the findings and 
recommendations of the National Academy of Sciences (NAS) report and 
input from the public. The NAS report, initiated in 1997 at the request 
of Congress, provides an examination of the scientific and 
organizational needs of an effective food safety system. Upon 
completion of its evaluation of the current food safety system, the 
Council will make additional recommendations on how to advance the 
efforts identified in the President's Food Safety Initiative. The 
Council held four public meetings to receive input concerning important 
elements of the food safety system.
    USDA, HHS, and EPA are identifying new opportunities to improve 
food safety, avoid duplication, and leverage agency resources. This 
process is greatly enhanced by the Joint Institute for Food Safety 
Research (JIFSR), which was created by Executive Order in July 1998. By 
creating the JIFSR and setting it within the Council, the President has 
re-emphasized the importance of establishing a seamless, science-based 
food safety system. This represents an efficient and effective way to 
ensure the implementation of a farm-to-table food safety strategy that 
reduces the level of foodborne illness in the most effective way 
possible.
    This vision also reflects the findings from the National Academy of 
Sciences (NAS) report, Ensuring Safe Food from Production to 
Consumption, that an effective food safety system is a coordinated, 
interdependent system composed of government agencies at all levels, as 
well as other stakeholders. NAS found that the successful integrated 
operation of a food safety system requires that officials at all levels 
of government work together in support of common goals of a science-
based system.
                      usda response to nas report
    Part of the President's direction to the Council was to prepare 
comments and information for him concerning the report by the National 
Academy of Sciences (NAS) requested by the Congress and issued last 
summer. Each Department has reviewed the report carefully.
    The NAS report, Ensuring Safe Food from Production to Consumption, 
identifies a desire for a ``national food law that is clear, rational, 
and comprehensive, as well as scientifically based on risk'' as a major 
component of a model food safety system. USDA certainly agrees with the 
NAS that our food safety systems should be science-based and should 
utilize risk analysis whenever possible.
    The document also notes that the continuous inspection system of 
meat and poultry through sight, smell, and touch creates 
inefficiencies, and should be replaced by a science-based approach that 
is capable of detecting hazards of concern.
    Even though the current law requires continuous inspection, it does 
not specify how this inspection is to be carried out. The statutes do 
require appropriate examination of animals prior to slaughter and 
examination post-slaughter at all official slaughter and processing 
facilities. Among other significant food safety purposes, this 
continuous inspection requirement ensures use of the best sanitary 
dressing processes, prevention of fecal contamination, and prevention 
of meat from diseased animals entering the food supply.
    Under the statutory flexibility that already exists, USDA has begun 
to develop and test a more risk based inspection system, including 
adopting regulations requiring that HACCP be implemented in all 
slaughter and processing plants. In addition, USDA is studying how best 
to effect further improvements in the inspection of meat and poultry.
Statutory Differences
    It should be noted that there is a fundamental difference between 
the statutes that govern the inspection and oversight of meat, poultry, 
and egg products, implemented by FSIS, and the statutes for other 
foods, enforced by HHS via the Food and Drug Administration.
    It is FSIS' statutory responsibility to ensure that no meat and 
poultry that may be adulterated receives the mark of inspection and 
enters the marketplace. Companies slaughtering or processing meat and 
poultry have a legal obligation to report such activity to FSIS, and 
FSIS is obligated to provide appropriate inspection to the plant. FSIS 
also has the responsibility to ensure that only countries that maintain 
inspection systems for meat, poultry, and egg products that are 
equivalent to the U.S. systems may export these products to American 
consumers.
    FDA's statutory responsibility is much different. FDA is obligated 
to remove adulterated foods from the marketplace. FDA has the authority 
to inspect establishments producing food but does not provide daily 
inspection of even high-risk food products at this time.
    USDA will continue working through the Council to analyze and 
coordinate our resources to provide science and risk based research, 
comparative risk analysis, surveillance, inspection, and education to 
carry out the recommendations of the NAS report.
                            fsis activities
HACCP Implementation
    On January 25, 1999, a milestone was reached in our strategy for 
making significant gains in improving the safety of America's food 
supply. On this date, over 3,000 large and small plants accounting for 
92 percent of meat and poultry production were operating under HACCP 
plans. We recognized from the very beginning that small plants, those 
with between 10 and 499 employees, had fewer resources to draw on than 
large plants. Because of this, we prepared for implementation of the 
rule in small plants by providing extensive technical assistance.
    We appointed a National HACCP Small Plant Coordinator to coordinate 
the various activities underway to assist small plants. We established 
a network of contacts and State coordinators around the country to 
disseminate information on HACCP and provide technical guidance to 
small plants. We also conducted small plant demonstration workshops 
throughout the country to provide guidance and technical assistance to 
small plants, asked large plants to act as sponsors for small plants in 
order to help them develop their HACCP plans, and held a series of 20 
implementation meetings around the country to answer any questions on 
HACCP. Field supervisors made personal visits to each plant to assist 
in their preparations for HACCP implementation. HACCP coordinators were 
identified in all affected States. These are just a few examples of the 
initiatives we put in place to assist small plants with HACCP 
implementation.
    Of course, credit needs to be shared. Numerous industry 
associations and academic institutions worked extremely hard to provide 
assistance and training to their members and to plants in their 
vicinity. Small plant management also deserve much of the credit for 
their hard work in preparing for HACCP implementation.
    As you know, in January 1998 approximately 300 large plants 
implemented HACCP, accounting for 75 percent of the volume of meat and 
poultry production in the United States. Large plants had approximately 
a 92 percent compliance rate during the first 9 months of 
implementation. Where a few problems did occur, enforcement actions 
were implemented and establishments responded by modifying and 
strengthening their HACCP plans. Implementation in large and small 
plants has been smooth thanks to the efforts of both industry and 
government.
    Very small plants, those with fewer than 10 employees, will 
implement HACCP in January 2000. We will continue our outreach by 
holding nationwide public meetings and workshops to prepare very small 
plants for HACCP. We are committed to ensuring a smooth transition to 
HACCP for very small plants.
    One year ago, many questions were raised about whether HACCP would 
really work. I believe we have the answers to those questions now. Data 
released at the beginning of March based on the first 12 months of 
testing in large plants show that the prevalence of Salmonella in 
broilers, swine, ground beef, and ground turkey was substantially lower 
after HACCP implementation than in baseline studies conducted before 
implementation.
    The first data released for ground beef samples showed 7.5 percent 
testing positive for Salmonella prior to January 1998 and only 4.8 
percent testing positive after HACCP implementation, a decline of 36 
percent.
    The new data for broilers and pork continue positive trends 
reported several months ago. Of broiler carcasses, 20.0 percent tested 
positive for Salmonella before HACCP implementation, compared to 10.9 
percent after implementation. That's a decline of over 45 percent. On 
swine carcasses, 8.7 percent tested positive prior to HACCP versus 6.5 
percent after HACCP implementation, a decrease of more than 25 percent. 
As for ground turkey, 49.9 percent tested prior to HACCP versus 36.4 
percent after HACCP implementation. This represents a decline of nearly 
27 percent.
    These data, while preliminary, indicate that the Administration's 
science-based inspection system has already had a significant effect on 
the safety of food American families eat by reducing the prevalence of 
Salmonella. Salmonella is a potentially deadly bacteria that in the 
past had sickened as many as 3.8 million Americans a year and cost 
billions of dollars in lost productivity and medical costs annually.
    Compliance with the requirements of the rule has been excellent. 
For example, 88 percent of large plants with completed sample sets are 
meeting the government's Salmonella standard, and we have similarly 
high compliance data for the remainder of the requirements of the rule. 
Those establishments that did not meet the standards were required to 
take immediate corrective action. We have been putting out quarterly 
enforcement reports so the public can follow our progress, and we 
should have a new enforcement report out soon.
New Inspection Models
    As USDA focuses on HACCP implementation throughout the industry, it 
has begun development of a project to design new inspection models that 
better address current public health risks in the meat and poultry 
supply. These changes will improve the efficiency and effectiveness of 
inspection oversight and permit better use of Department resources.
State Cooperative Meat and Poultry Inspection Programs
    FSIS oversees and supports (with more than $40 million annually) 26 
State inspection programs for meat and poultry. These cooperative 
programs permit States to inspect product for distribution within their 
own boundaries. The State inspection programs must be equal to the 
Federal program conducted by FSIS. All State plants required to enter 
the program have implemented HACCP. Very small plants are required to 
implement HACCP in January 2000.
Information Sharing
    FSIS has a trained inspection force in every Federally inspected 
meat and poultry slaughter and processing plant in the United States. 
In some cases, products are being processed in the same plants that 
fall under the jurisdiction of FDA because these are food products that 
do not contain meat or poultry. FSIS and FDA are in the process of 
establishing and implementing a Memorandum of Understanding (MOU) to 
facilitate appropriate sharing of information among senior agency field 
personnel regarding safe food production in these plants.
Modernizing Information Technology
    As one step in the adoption of new information technologies in 
inspection programs, FSIS has developed an interactive computer 
system--the Field Automation and Information Management (FAIM) system--
for its own use, and is encouraging states to adopt it by sharing the 
costs of implementation. The system permits the field inspection force 
to have access to regulations, scheduling information, and appropriate 
information regarding enforcement. It can also be used for training. 
FSIS has conducted discussions with FDA regarding FAIM's applicability 
to its inspection system.
Food Code and International Standards
    USDA is also working more closely with its counterparts at the 
Federal, State, and local level to encourage national uniformity in 
food safety standards through support and endorsement of the Food Code. 
The Food Code provides guidelines for maintaining food safety in 
restaurants, grocery stores, nursing homes, and other institutional and 
retail settings.
    Because world trade in agricultural commodities continues to grow, 
USDA is working through the Codex Alimentarius Commission to encourage 
international uniformity in food safety standards. Responsibility for 
oversight of the U.S. Manager of Codex is located in the Office of 
Under Secretary for Food Safety.
Voluntary Quality Control Programs
    The Animal Production Food Safety Staff in FSIS is an excellent 
example of developing partnership with States to encourage the 
voluntary implementation of quality control programs at the animal 
production level. The education of small producers is of particular 
concern as we move forward with HACCP implementation in small plants. 
We believe that changes in the marketing of animals will be expected by 
plants operating under HACCP, and we want to help producers be ready 
for these changes.
                fy 2000 usda food safety budget request
FSIS Budget Request
    The FSIS fiscal year 2000 budget proposes a program level of $742 
million, of which $653 million would be appropriated under current law. 
This is a net increase of $36 million over the 1999 current estimate. 
The 2000 budget includes increases for pay costs to meet our statutory 
obligation to provide inspection services and a programmatic increase 
to implement our farm-to-table food safety strategy. The 2000 budget 
includes increases to help the FSIS inspection workforce make the 
transition to a new HACCP environment, including conversion of 638 
inspection positions to Consumer Safety Officer positions.
    In these new positions, employees will be responsible for 
conducting scientific testing and inspections in plants and in product 
distribution. Some of these personnel will be redeployed to cover 
critical inspection vacancies in nearly 3,400 very small 
establishments. These redeployments and upgrades will increase the 
professional qualifications of the inspection workforce.
    In the near future, the Administration will be transmitting to 
Congress the legislation necessary to support the 2000 budget proposal 
to recover the full cost of providing Federal meat, poultry, and egg 
products inspection through user fees. The user fees exclude Grants to 
States and Special Assistance for State Programs. Requiring the payment 
of user fees for Federal inspection services would not only result in 
savings to the taxpayer, but would also ensure that sufficient 
resources are available to provide the mandatory inspection services 
needed to meet increasing industry demand and assure consumers of 
appropriate oversight and enforcement. The overall impact on prices as 
a result of these fees has been estimated to be less than one cent per 
pound of meat, poultry, and egg products production. The implementation 
of the user fee authority would be designed to be fair and equitable, 
promote accountability and efficiency, and minimize the impact on the 
competitive balance among affected industries. Appropriated funds are 
requested to convert the Federal program to user fees and for 
maintaining State inspection programs.
Food Safety Initiative Budget Request
    Six of USDA's agencies are requesting a total of $151 million to 
support the President's Food Safety Initiative, an increase of $34.8 
million over the fiscal year 1999 level. With the additional funds, the 
agencies will improve our ability to identify food safety hazards, 
develop more effective control strategies, and improve our response to 
outbreaks of foodborne illnesses when they occur.
    In support of the President's Food Safety Initiative, the budget 
for FSIS includes increases in the amount of $2.9 million to address 
food safety risks in three critical areas: emergency response 
coordination with the States in investigating foodborne illness 
outbreaks; validation of the ability of State laboratories to meet 
HACCP pathogen testing requirements; and pathogen testing in Federal 
laboratories of State-inspected product.
    The budget for Research, Education and Economics (REE) includes 
increases in the amount of $25.7 million to: expand research for the 
development of new pathogen intervention technologies at the pre-
harvest level, initiate research that will lead to a better 
understanding of how the use of antibiotics in food-producing animals 
increases the risk of emergence of micro-organisms that are resistant 
to specific antibiotics, integrate research and education in food 
safety, and provide the economic analysis necessary to evaluate the 
effectiveness of various risk-reduction strategies for reducing 
foodborne illness. This amount will be distributed to the following 
agencies within REE: Agricultural Research Service ($11.7 million), 
Cooperative State Research, Education, and Extension Service ($11.0 
million), Economic Research Service ($0.5 million), and the National 
Agricultural Statistics Service ($2.5 million).
    The budget for the Agricultural Marketing Service, within Marketing 
and Regulatory Programs (MRP), includes $6.2 million to establish 
microbiological baselines for pathogens on fruits and vegetables.
                               conclusion
    Thank you again for the opportunity to appear before you today and 
discuss the Administration's goals to enhance food safety. I look 
forward to working with you and my colleagues and I will be happy to 
answer any questions you or other Members of the Subcommittee may have.

                        CONSUMER SAFETY OFFICES

    Senator Cochran. I have a few questions that I will ask at 
the outset and then yield to other Senators for their comments 
and questions.
    One thing that I noticed in your statement, Dr. Woteki, is 
the mention of the redeployment of Food Safety and inspection 
service personnel. I noted that you have something called a 
Consumer Safety Officer, which is a new phrase. Tell us what 
the Consumer Safety Officers will be doing and where they will 
be deployed.
    Dr. Woteki. Well, I would like to ask Mr. Tom Billy, the 
FSIS Administrator, to join me at the table. While he is 
getting up to do so, let me just briefly say that one of the 
objectives that we are trying to achieve through the 
development of this new job classification series is an 
upgrading of the technical expertise that exists within the 
FSIS inspection workforce.
    There are many jobs, both within plants, as well as jobs 
that compliance officers and others do, that require these 
additional technical background and skills.
    part of what the agency's major goal in creating this new 
series is to create the opportunity to both upgrade within our 
workforce those who have these skills, as well as to recruit 
from outside.
    Mr. Billy has been spending quite a bit of time thinking 
about how those Consumer Safety Officers are going to be going 
about doing their work. I would like him to respond.
    Senator Cochran. Mr. Billy.
    Mr. Billy. Good morning. The shift to a HACCP-based 
approach not only brings with it a number of scientific 
components but also the need for inspectors to be able to use 
the tools of science and statistics to make judgments about 
process control. We need a different kind of inspector than we 
have traditionally had.
    This new classification series--and that is what it is--
will provide us with the kind of person with a college degree 
and a certain number of credit hours in the sciences that will 
enter the workforce and, with training, be able to carry out 
our responsibilities of oversight and verification under this 
new HACCP-based system.
    It also fits well with some of the other roles we play in 
compliance. I might add that it is the backbone in terms of the 
classification series in FDA for their field inspection force. 
So it is well tested and I think will serve us well as we look 
to the future.
    Senator Cochran. There has been one suggestion that some of 
these redeployed personnel may be assigned to the distribution 
system, as well as in grocery stores or in other areas.
    My question is: If that is true, what analysis have you 
done to see whether you are overlapping with State and local 
public health department inspections and Food and Drug 
Administration inspections that are already being carried out 
in those areas?
    Dr. Woteki. Well, Senator, I understand that there has been 
some concern raised by State officials about overlapping 
responsibilities. I do want to assure you, as we have assured 
them, that as we are developing this plan and moving forward in 
doing some tests, we will not be duplicating those 
responsibilities.
    I would like to ask Mr. Billy again to describe to you in 
some detail the approach that the agency is taking.
    Mr. Billy. We have, for many years, in fact decades, had a 
presence in the marketplace represented by our compliance 
officers that visit retail establishments, and check products. 
It is one of the final verifications under HACCP that in fact 
products are in compliance with our requirements.
    They also investigate consumer complaints about products. 
When we find problems, we take the appropriate regulatory 
follow-up action. We conducted over 26,000 such verifications 
last year. These consumer safety officers and many of our 
compliance people will continue that type of responsibility.
    In addition, we have been working very closely in 
conjunction with FDA and with the Food Protection Conference, 
which is an organization set up by the states to oversee their 
regulation of the retail sector. We plan to continue to work 
closely in that framework to assist the state and local 
authorities in terms of making sure that, with regard to meat, 
poultry and egg products, there are proper, effective standards 
in place, and those regulatory people are trained in ways to 
make sure that those standards are being met.
    We have worked this through the States. We have an ongoing 
training program for retail inspectors at the State level. It 
is in cooperation with FDA. It is done through satellite down-
link type of approach. We are providing important training so 
that those people at the State and local level can carry out 
their responsibilities.

                      INSPECTION OF IMPORTED FOODS

    Senator Cochran. We have had hearings in the Senate chaired 
by Senator Susan Collins, chairman of the permanent 
Subcommittee on Investigations of the Governmental Affairs 
Committee. Those hearings have indicated that there is really a 
need to do more in the imported food area, particularly with 
respect to the inspection of fruits and vegetables and many 
other commodities coming into our country.
    Will it be part of the administration's effort of 
consolidation and reorganization to see that this area, which 
has not been sufficiently covered by inspection personnel, is 
addressed? I think Dr. Henney may have more responsibility 
statutorily in this area than others. Would you like to respond 
to that?
    Dr. Henney. Mr. Chairman, while we all share an interest in 
imported food products, I think the particular sector that you 
are talking about, particularly produce is within our 
jurisdiction. And within the request that we are giving you 
today, about $17 million of the $30 million request is targeted 
towards our inspectional capability.
    With this money we would be able to develop more tools for 
our inspectors to use. We would be able to inspect 
domestically, as I said, at least in our high-risk areas once a 
year.
    But more importantly and to your question, our foreign 
inspections would double, not only with inspections of foreign 
food processors, but we would be able to continue evaluating 
the systems that are used by foreign countries to access their 
adequacy and determine if their systems are equivalency to our 
own.
    Senator Cochran. One part of our law suggests that the 
imports into the country will not be permitted in some areas of 
processed foods, foods that have been processed in other 
countries, that they have to abide by the same kind of 
inspection regime and safeguards that our domestic 
slaughterhouses and processors have to follow.
    How is that law enforced in terms of inspections to verify 
that the right kinds of practices are occurring in other 
countries and stopping the importation of food products that do 
not comply with that rule?
    Dr. Woteki. Well, Senator, I might respond to that 
question. The legislative authorities for the Department of 
Agriculture essentially require that any country shipping, 
exporting meat and poultry products to the United States, has a 
system that will provide the same level of consumer protection 
as the U.S. system.
    The Food Safety and Inspection Service is implementing that 
legislative authority using a three-pronged approach.
    The first level is for any country that wants to export 
meat or poultry products to us, that we first of all review 
their statutes, we review their regulations to assure that they 
do have a system in place of inspections that will be 
considered, or could be considered, to be equivalent to our 
own.
    The second prong is actual visits to meat packing 
establishments to inspect that indeed what is going on within 
those plants is meeting that country's system, which has been 
determined to be equivalent to our own.
    Then the third prong is when a product is imported into the 
United States, when it reaches the port, it is reinspected. So 
I think we have a good program in place for meat and poultry 
that assures that imported products do meet the same level of 
protection that we have here for domestically produced 
products.
    Senator Cochran. Thank you.
    Senator Kohl?

                COORDINATION OF FOOD SAFETY INITIATIVES

    Senator Kohl. Thank you, Senator Cochran. Any initiatives 
such as the Food Safety Initiative that crosses agency and 
departmental lines clearly requires high levels of cooperation 
and coordination. For all of you, what steps are being taken to 
ensure that all food safety initiatives and activities are 
properly coordinated?
    Is there any one agency or person responsible for taking 
the lead on food safety initiatives? And what steps are needed 
to improve communication and cooperation among the agencies?
    Dr. Woteki. Senator, we have actually the President's Food 
Safety Council that is co-chaired by Secretary Glickman, 
Secretary Shalala and Dr. Neil Lane. It was established by 
presidential directive in August of last year. I alluded to the 
council's activities in my opening statement. The council is 
working on developing a strategic plan for food safety. It is 
working to develop coordinated budgets.
    So I believe that certainly the council is playing a very 
important role in providing very high level oversight and 
directions to the actions and activities of the many agencies 
that are involved in food safety.
    Beyond that, we also have a number of different 
coordinating mechanisms that are in place. One of them is that 
there are periodic meetings of a group of principals who are 
responsible for food safety. Another I alluded to also in my 
opening statement, the Foodborne Outbreak Response Coordination 
Group.
    So there are a number of different activities that we have 
underway so that we can be sharing information, developing 
plans, coordinating our activities, not only at the federal 
level but also involving the states as well.
    Senator Kohl. Dr. Henney?
    Dr. Henney. I, like Dr. Koplan, have returned back to 
federal service after a five-year hiatus. And I must say my 
observation is very similar to his in terms of being quite 
gratified at the level of cooperation that there is between and 
among the federal agencies, and particularly our important 
partners at the State level.
    I think Dr. Woteki is very correct in her observations that 
at a very high level of government, there is oversight of 
policy and budget development.
    But I think more importantly is the day-to-day issue that 
worries the average American citizen, that is: is my food safe. 
At an operational level, the people working within the agencies 
when an outbreak does occur are working on initiatives to see 
that outbreaks are prevented. These efforts are is very intense 
and very tightly coordinated.
    Senator Kohl. Mr. Koplan?
    Dr. Koplan. The only thing I would add is, at the daily 
working level, we now have assignees from each other's agencies 
working in our own agency. This is something that had not 
occurred before. It is tremendously helpful on a daily basis to 
anticipate problems that can come up and to facilitate 
communication.
    These folks know who to call in the other agency when 
something is needed and know how the other agencies work. I 
know CDC has assignees in both of my colleagues' organizations, 
working daily on their issues, and informing them about what we 
are doing in that area as well. It is a very helpful mechanism.

                       FOODBORNE DISEASE OUTBREAK

    Senator Kohl. All right. I have been provided by the FDA a 
map of the United States which shows foodborne disease 
outbreaks for the period of January to July of 1998. I 
understand this map is based on information provided by the 
Centers for Disease Control and Prevention. This map indicates 
that some states with relatively low populations, such as 
Wisconsin and Kansas, have a large number of outbreaks compared 
to other states with relatively high populations, such as 
Texas, Florida and New York.
    What is the actual definition of foodborne disease 
outbreak? Is the period shown on this map representative of 
incidents of outbreaks generally? And to the extent that 
outbreaks were a problem in Wisconsin during the period shown 
on this map, what is the FDA or any other agency doing to help 
control this problem?
    Dr. Henney?
    Dr. Henney. Senator Kohl, I appreciate your question, 
knowing that I lived in Kansas for six years. Those are very 
important states to me. I believe the definition of an outbreak 
involves an illness of two or more persons related to a 
particular food.
    I think that I would go back to what I said in my opening 
statement. The map that you see is only reflective of that 
period of time. If we would look at a snapshot of what happened 
last week or another six-month period, it might involve highly 
urban areas or different states altogether.
    The way food is distributed in this country, the foods that 
can be affected in terms of a foodborne illness makes this a 
very complex kind of issue. But we do try to give snapshots of 
what is going on at any period of time. We can usually track it 
back to a particular kind of food.

                     INCIDENCE OF FOODBORNE ILLNESS

    Senator Kohl. So are you saying that what we see on those 
maps, which would indicate that Wisconsin and Kansas have an 
unusually high incident, that that is not representative or 
would not be representative over a period of time?
    Dr. Henney. That is exactly correct. It might be that 
Kansas and Wisconsin had a particular distribution of a type of 
food, and it was only eaten by that population. It may very 
well be that the Department of Health or the physicians seeing 
those patients that were affected were particularly alert to a 
situation. It is a multi-factor kind of issue, I think, that 
could be observed in any state.
    Perhaps Dr. Koplan could add a little bit more to that.
    Dr. Koplan. One thing I would add, in keeping with Dr. 
Henney's last comment, is that for a disease surveillance, 
another factor that one must consider is the quality of the 
surveillance in that locality. Some places that are more 
aggressive and have people reporting more will show a higher 
incidence.
    From past experience over many years in public health, I 
can tell you that your state has one of the better state health 
departments. Dr. Davis who is in charge of infectious disease 
epidemiology is superb. This may reflect the increased 
incidence that has been found.
    It may also indicate that in a given year even one outbreak 
can cause many more cases of illness than the previous year. 
One must look over a longer trend.
    One of the things that we are doing to address this issue 
is, as part of these initiatives, to try to come up with a 
better estimate of the real incidence of diarrheal diseases 
around the country, so as to make comparisons from one state to 
another a little more controlled. We are in the process of 
doing that now. Over the next few months, we hope to have 
better data that permits the kind of comparison that gets 
around the issue: Is surveillance better in one place than 
another?
    Senator Kohl. Thank you.
    Senator Cochran. Senator Durbin.

                           PREPARED STATEMENT

    Senator Durbin. Thank you, Mr. Chairman. At the outset, I 
would like my opening statement be made part of the record.
    Senator Cochran. It will be.
    Senator Durbin. Thank you.
    [The statement follows:]
                  Prepared Statement of Senator Durbin
    Mr. Chairman, thank you for calling this hearing today. Food safety 
is a subject that affects every person in our country every day. 
Unfortunately, we all too often take the safety of our food supply for 
granted. But, recent outbreaks--from ham at a church picnic to imported 
raspberries to eggs to recalls of hot dogs and ground beef--remind us 
of the food safety dangers that can many times prove deadly.
    I come at this topic from several different angles. First, I'm a 
consumer. I want the food supply to be as safe as possible for my 
family and especially for my almost three-year-old grandson. Second, I 
have a deep respect for those who grow and produce our food and fiber. 
American agriculture does produce the safest and most abundant food in 
the world. But, I believe that we can always do more to ensure it is 
safe. And, finally, when I served on the House Appropriations 
Subcommittee on Agriculture, I was on the front lines of earlier 
efforts to improve food safety, from Hazard Analysis and Critical 
Control Point--HACCP--to funding for additional meat inspectors.
    I congratulate this Administration on its hard fought efforts to 
improve the safety of our food supply. The Pathogen Reduction and HACCP 
systems regulations are proving to be a significant advance in food 
safety. The President's Food Safety Initiative is gaining steam and 
drawing more cooperation within the Executive Branch. I was pleased to 
join Senator Harkin last year when we took the funding question to the 
Senate floor and found that almost three quarters of our colleagues 
agreed that the President's initiative on food safety should be 
adequately funded. But, we can always do better.
    With regard to improving the safety of our food supply, allow me to 
mention a topic that I believe to be the next logical step to more 
effective regulation, lower costs, and clearer goals in our food safety 
battle.
    Currently, there are at least 12 different Federal agencies and 35 
different laws governing food safety and inspection functions. With so 
many bureaucrats in the kitchen, it is no wonder that breakdowns occur. 
Overlapping jurisdictions, Federal agencies without accountability, and 
resources that are wasted are just inexcusable. A single, independent 
agency that will focus our policy and improve the enforcement of food 
safety inspection is really overdue.
    The General Accounting Office (GAO) has called for the 
consolidation of our country's food safety and inspection functions 
hundreds of times in the last decade. I have found Congressional 
reports that date back as far as 1949 that lament the fragmented 
structure of the Federal government's approach to food safety. The most 
ironic example is the Senate Governmental Affairs Committee hearings on 
the adequacy of Federal food safety inspection in 1977--led by Chairman 
Ribicoff of Connecticut and Ranking Member Percy of Illinois. The 
Committee report contained the following passage: ``Divided 
responsibility for regulating food production has resulted in a 
regulatory program which is often duplicative, sometimes contradictory, 
undeniably costly, and unduly complex. We believe the bifurcated food 
regulation system should be unified in a single agency.''
    I serve on the Governmental Affairs Committee with Chairman Cochran 
and others. Last Congress, we held four subcommittee hearings into the 
safety of imported foods and the idea of a single, independent agency 
was discussed--twenty years after the Committee concluded that the 
current structure just didn't make sense.
    Vice President Gore, in the National Performance Review, also made 
a case for a unified approach to food safety.
    And, this past summer the National Academy of Sciences (NAS) 
released their findings on how the Federal government deals with food 
safety and inspection. I don't think it will surprise anyone that the 
NAS concluded that one of the more important short-term goals should be 
fixing the overlap and finding a way for all of the agencies and 
departments to work together in a unified manner.
    In the next few weeks, I'll be reintroducing legislation that 
consolidates our food safety and inspection functions into a single, 
independent agency. I hope the Administration and my colleagues will 
join me in this discussion. I believe it is a topic that is simply too 
important to ignore any longer.
    Let me quickly touch on a couple of other topics. First, egg 
safety. Last year, Secretary Glickman issued an administrative order 
that barred the practice of repackaging eggs. I followed up that 
initiative with language in the Omnibus Appropriations bill that 
codified the order. I am pleased to report that those packers that 
participate in the voluntary USDA egg grading system are no longer 
allowed to repackage eggs, a dangerous practice that oftentimes leads 
to redating and selling of old eggs. The language also called for a 
joint USDA-FDA report on egg safety to Congress. We're still waiting 
for that report. Also, the GAO is undertaking a thorough evaluation of 
egg and egg product safety. I hope USDA and FDA will work with us as we 
attempt to reassure the American consumer that the eggs they buy are 
indeed safe. When more than 660,000 Americans get sick every year from 
eating eggs contaminated with Salmonella enteritidis (SE), we need to 
do better.
    Finally, in Illinois, we have what some have described as a secret 
weapon in the fight to detect and prevent foodborne illnesses. It's 
called the National Center for Food Safety and Technology at the 
Illinois Institute of Technology near Chicago. It is one of a kind. The 
National Center is a research and development facility that supports 
the FDA in its mission to ensure the safety of food products other than 
meat and poultry. It's a ten-year-old collaboration between the Federal 
government, private business, and academia. And, I can tell you from 
first-hand experience, it's working. In the coming weeks, I'll be 
asking my colleagues on this Committee as well as the FDA to work with 
me in order to help the National Center continue its pursuit of 
solutions to our food safety problems.
    Mr. Chairman, Senator Kohl, thank you for organizing this hearing 
today. Food safety is a matter that should be a high priority for all 
of us. I look forward to working with you and the Administration as we 
go the extra mile to reassure consumers that we're doing all we can to 
continue to supply the safest food in the world.

                          FOOD SAFETY PROGRAMS

    Senator Durbin. I would like to acknowledge the presence of 
Dr. Henney and Dr. Woteki. I have not met Dr. Koplan, but I 
thank him for joining us. I have worked with Dr. Henney for 
many years at the Food and Drug Administration, I've always 
respected her contribution. I am happy that she is in a 
leadership position there. And, I am looking forward to 
continuing working with her.
    Dr. Woteki, with the USDA, thank you again for all that you 
have done. The Centers for Disease Control enjoy an excellent 
reputation in this area also.
    I was curious yesterday when the White House announced its 
statement on the National Academy of Sciences report. It 
included a provision or recommendation which said, ``A new 
statute should be enacted that establishes a unified framework 
for food safety programs with a single official with control 
over all federal food safety resources.''
    I think that is fairly clearly stated. I am happy to hear 
it, of course, because for 50 years on Capitol Hill we have 
been debating that very same issue. Whether we are finally 
going to take the dozen different federal agencies that inspect 
food and put them under one coordinated leader, I think that is 
a clear result or recommendation from this report.
    The oddity is in Washington, Spin City USA, we have press 
releases from the Grocery Manufacturers of America, as well as 
the National Food Processors Association, which conclude just 
the opposite, that this report does not suggest that there will 
be a single official heading these food safety agencies.
    I would recommend to the people in industry that they take 
a closer look at the actual recommendation in that report. I 
would also suggest to them that it is in their best interest to 
work with us, to coordinate this effort, rather than resist it. 
The agencies represented here and the work that they do is 
important, but it can be improved upon.
    And if we can avoid duplication and avoid overlap, the food 
industry should be in our corner. They should be working with 
us, not throwing out these press releases creating the 
smokescreen of opposition to what is just plain common sense.

                            HACCP COMPLIANCE

    Let me go into three specific areas where I think we can 
definitely improve the situation. Let us talk about HACCP 
compliance, I noticed Dr. Woteki raised that issue. The first 
year of HACCP implementation in meat, poultry and seafood 
showed radically different results between the FDA and the 
USDA.
    While the large meat and poultry plants had a compliance 
rate of over 90 percent, the compliance rate for the seafood 
industry was only 30 percent. The FDA found that 70 percent of 
seafood plants had ``serious or critical'' violations of HACCP 
rules.
    Forty percent of those plants were not even implementing 
the new requirements. For imported seafood, the record was even 
worse. Eighty percent of seafood importers had serious or 
critical violations.
    Some have criticized the FDA's system for failing to have 
frequent inspections and mandatory testing and say it is little 
more than an industry honor system. I would like, Dr. Henney, 
if you would respond to that.

                  FREQUENCY OF INSPECTION UNDER HACCP

    Dr. Henney. Senator Durbin, let me respond in terms of 
speaking a little bit about the differences in approach of the 
two departments in terms of what has been done by agriculture 
with respect to meat and poultry and our approach with respect 
to seafood HACCP.
    I think as Dr. Woteki mentioned, USDA, as they approached 
implementing a HACCP program, has taken a stepwise or a phase-
in approach to it. We took the approach of looking at all 
domestic process inspectors and having them inspected within 
the first year. So we are looking everywhere from the smallest 
mom and pop kind of shop to very large seafood processors.
    Our frequency of inspection is annual. We are very rigorous 
in that.
    Senator Durbin. Excuse me, Dr. Henney. How does that 
compare with Dr. Woteki at USDA? How frequently do you inspect?
    Dr. Henney. They do a continuous----

                              INSPECTIONS

    Senator Durbin. So it is a daily inspection, as opposed to 
an annual inspection.
    Dr. Henney. It is continuous. I do not know if that is 
daily or--it is more than annual.
    Senator Durbin. So we have an annual inspection for 
seafood, a daily inspection for meat and poultry. Does that 
give a lot of confidence to consumers in America? I do not 
think so.
    Dr. Henney. I think that the HACCP approach, because it is 
science-based, and if there is an appropriate plan in place and 
it is implemented well, an annual approach for this kind of 
inspection is reasonable. We are looking at different kinds of 
things when you talk about meat and poultry compared to 
seafood.
    In meat and poultry you have a number of bacteria that are 
found in much greater frequency. We have to look in seafood not 
only for some of those kind of issues, but also important 
chemical and physical property issues as well. So the HACCP 
program is very comprehensive with respect to seafood.
    With respect to the rate of compliance, the 70-percent rate 
meant that we left a letter with those processors. When you 
look at the actual violations that occurred, the kind of 
companies that are considered volative, is at a rate of less 
than five percent. And that compares with the total food that 
we inspect in all of our programs which has a 6-percent 
volative rate.
    So while I do believe that there is a need to be concerned 
and that we get more of the processors in compliance. I think 
in the very first year we expected a fairly high percentage of 
the seafood industry not being compliant with this new system. 
We intend to take a multipronged approach to do that.
    But we were actually pleased to look at that end product of 
the volative rate not being higher than what we see in the 
total food system.
    Senator Durbin. Dr. Henney, I would disagree with that and 
say that when 40 percent of the plants were not even 
implementing the new requirements, I do not think that is a 
good result. I think we can do better.

                     INSPECTION OF IMPORTED PRODUCT

    Let me give another example. Imported meat and poultry 
products are subject to a two-stage approval process by USDA. 
First, the exporting countries meat and poultry inspection 
system must be approved by USDA.
    Then the individual plant must be inspected by USDA before 
it can ship meat to the United States. Even then, it is subject 
to random verification checks at the border.
    And the Food and Drug Administration only has the authority 
to inspect food at the border, but has the staff to check less 
than 2 percent of import shipments. The Food and Drug 
Administration cannot send inspectors to foreign countries 
except by invitation, even when they are checking the source of 
food involved in an outbreak in the United States.
    Again, Dr. Henney, that seems such a dramatic difference 
between the standards that are being used. For the consumer, 
the fact that we are talking about a polish ham, as opposed to 
some processed food in a can, really does not make a big 
difference.
    They expect everything on the shelf having gone through 
some government inspection, whether USDA or FDA, to be safe for 
their family. And yet we still have this wide disparity in the 
standards that are used.
    I am not blaming you for this. Congress has the blame for 
this. We have created this mess. But do you believe, as I do, 
that unless we can harmonize these two inspection systems, we 
cannot give consumers in America the assurance they need about 
the safety of the food they eat?
    Dr. Henney. Senator, I said at the time of my confirmation 
hearings that an inspection system, an inspection force that is 
limited to inspecting less than 2 percent of foreign imports is 
less than credible.
    And I think that is one reason why we are bringing forward 
this budgetary request that would greatly enhance our ability 
to inspect not only at the borders, but to do some of those 
foreign inspections that you speak about.
    Senator Durbin. I am not going to dwell any longer, because 
Senator Harkin, who has been a real leader on this issue is 
next. And I am sure he has some important questions that he 
wants to ask and is anxious. [Laughter.]

                         EGG SAFETY INSPECTIONS

    I do want to say that we are waiting for a report is egg 
safety inspection. The incredible, edible egg is inspected by 
so many different Federal agencies in so many different ways 
and with little or no assurance for the consumers.
    We did have, thanks to Secretary Glickman's leadership, an 
initiative about repackaging eggs. So I think the industry is 
more attentive to their responsibility to consumers.
    But I will be looking forward to that report. And believe 
me, if I have been critical today, the criticism should really 
be self-directed. Congress for 50 years has created this mess. 
We have to work with you to straighten it out. And I sincerely 
hope that the response of the industry to this National Food 
Safety Council report yesterday is no indication that they are 
going to be resistant. They should be working with us.
    Thank you, Mr. Chairman.
    Senator Cochran. Senator Harkin.

                           PREPARED STATEMENT

    Senator Harkin. Thank you, Mr. Chairman. And I would like 
to also ask that my statement be made a part of the record in 
its entirety.
    Senator Cochran. Without objection, it is so ordered.
    [The statement follows:]
                  Prepared Statement of Senator Harkin
    Good morning, Mr. Chairman, Dr Woteki, Dr. Henney and Dr. Koplan. 
Mr Chairman, I applaud you for this unified approach to our study of 
Federal food safety programs. The Food Safety Initiative, now in its 
third year, represents an integrated approach to the problem of food 
safety, and it is fitting to discuss funding issues in this holistic 
context.
    Let me first express my regards to each of the Agency officials 
here today, and recognize the tremendous progress we have made in the 
past three years. We are just beginning to see the benefits of these 
efforts, as Dr. Koplan has reported, in decreased illness rates for 
Salmonella and Campylobacter. ``Fingerprinting'' of pathogens, advances 
in testing methods, and the ongoing work of inspectors, scientists, 
epidemiologists and regulators, have changed the way we understand and 
respond to foodborne illness. This, and the successful implementation 
of HACCP systems for meat and poultry inspection, are helping us 
respond more effectively to illness or, even better, to prevent it 
entirely.
    I am pleased that the Agencies are addressing the problem of safety 
in fresh produce. Consumption of these products brings reductions in 
cancer and other chronic diseases, and yesterday's Wall Street Journal 
reported that the produce department is a crucial draw for consumers in 
their choice of grocery stores. But we have a number of emerging 
problems with this part of our food supply. The absence of domestic 
regulatory standards for fresh fruits and vegetables is a problem that 
hampers our ability to assure safety, both domestically and abroad. I 
plan to introduce legislation in the near future that will help assure 
the safety of these products for American consumers, by setting Federal 
standards.
    In the 105th Congress, I introduced legislation to grant the 
Secretary of Agriculture the authority to mandate a recall of 
adulterated meat and poultry products. I introduced the legislation 
again on the first day of this Congress. Events of the last year and a 
half have only convinced me further that this is a necessary authority. 
Dr. Woteki, I look forward to working with you to give the USDA the 
tools it needs to keep our food safe.
    I intend to give my strongest support to full funding for the 
President's Food Safety Initiative. The Initiative is a complete menu 
of innovative programs. PulseNet, the genetic fingerprinting network, 
is a leap forward in the way we manage illness and outbreaks. FoodNet 
can finally give us answers about victims of foodborne illness, and why 
they got sick. The Produce Initiative offers an integrated research 
strategy to allow us to enjoy these healthful foods safely. NARMS, the 
National Antimicrobial Resistance Monitoring System, is a model system 
to predict resistance problems in foodborne pathogens. Each of these 
programs draws on the best that each of the three Agencies here has to 
offer, and each one has already shown its value.
    Each year bring new successes with the Food Safety Initiative, and 
new challenges from emerging pathogens. This is a race we can't afford 
to lose. I applaud the work done by my colleagues, and by our food 
safety leaders in the Agencies. I look forward to working with each of 
you to assure the best possible system to protect our consumers.

                          FOOD SAFETY PROGRESS

    Senator Harkin. I would like to pick up where Senator 
Durbin just left off. But first of all, let me just say a 
couple of things. I do applaud the work that all of you are 
doing in this unified approach to food safety funding. I think 
it is making a significant difference, having watched it now 
over 20-some years.
    And I believe the Food Safety Initiative instituted by the 
administration now in its third year is promoting this type of 
integrated approach. And it seems we are making some progress.
    I want to personally thank each of the agencies who are 
here today for the progress that we have made in those 3 years, 
everything from genetic fingerprinting--I think that is an 
important step forward--research methodologies, the HACCP 
programs that are now implemented. I think it has made us 
respond more effectively to outbreaks. But also, I think it is 
giving a little bit higher rate of confidence among people, 
that we are really attacking this problem.
    Every time I go into a grocery store and I walk around, 
whether it is fresh meats, or fresh fruits and vegetables--and 
I am going to focus a lot of my comments or questions in that 
area--you just realize how much trust people have, picking up 
stuff off the shelves and taking it home and eating it. Just 
think of the inherent trust they have. They are trusting the 
store and the people who put it out there. But I believe that 
periodically they see signs that say ``USDA inspected,'' ``FDA 
inspected.'' And they believe that the Government is also doing 
their job to keep them safe.

                  CHANGES IN FOOD DISTRIBUTION SYSTEM

    While we have done a reasonably good job in the past, in 
the last, 15 or 20 years the changes we have made in our food 
distribution system in this country have been phenomenal.
    Meat processed and slaughtered in California is on a store 
shelf in North Carolina the next day. And part of that meat is 
in Michigan, part of it is in New Mexico, and just all over the 
place. It used to be that a small supplied supply a small area.
    The same is true of fruits and vegetables. You had small 
suppliers. We had warehouses. You go there, and they would 
supply a small area. The distribution is nationwide now. It is 
very hard to track distribution now.

                            RECALL AUTHORITY

    I have a couple questions and concerns, first of all, Dr. 
Woteki, on recall authority. I introduced a bill in the 105th 
Congress. I reintroduced it again earlier this year, with 
Senator Daschle, on the first day of the session. S. 18 gives 
the Department of Agriculture mandatory recall authority. A lot 
of people are surprised to find out that he does not have that 
authority, that it is only by request.
    Recent events that we have had convinced me that we do need 
to have this kind of authority. If you had that authority, 
could it be useful? How would it have worked on any of the 
recent outbreaks, for example? How do you view the issue of 
mandatory recall authority?
    Dr. Woteki. First of all, I thank you for introducing the 
bill, because it does respond to three areas that the 
administration and Secretary of Agriculture feel very strongly 
are areas in which additional enforcement authorities are badly 
needed.
    The mandatory recall area that is included in the bill is 
an area where you are absolutely correct, we do not have the 
authority to mandate a recall. We request that companies 
voluntarily conduct recalls. Now I do need to point out that by 
and large, most companies, the vast majority of companies, do 
respond and do respond quickly to requests from the department 
to conduct a recall when there is a problem. But there are 
occasions when there is foot dragging. There are some very rare 
occasions, such as ones we have encountered in this last year, 
where the mandatory recall authority would have been extremely 
helpful.
    I think it is also important to point out that the 
mandatory notification requirement also contained within the 
bill is an area in which we also believe that it would make our 
food safety system much stronger, if the department had that 
authority. Currently, both producers, the slaughter and 
processing houses, as well as some of their customers, are 
doing more and more product testing for pathogens present in 
foods. Yet they are not required to report those results to the 
department; and there have been instances where we do not know 
whether product that has been tested positive has been removed 
from commerce.
    We do believe that that mandatory notification authority 
would also be very important to the department. We think both 
mandatory recall and notification are very important.
    The third is the civil penalties area. Clearly in HACCP 
systems, it would be also very important to have the ability to 
level fines. The Secretary has frequently testified on this 
topic, and he is fond of using the term that he has the atomic 
bomb authority. He can withhold inspection, he can withdraw 
inspection and essentially close down a company.
    But there are many different types of situations, either 
systems failures within HACCP plants, violations that occur 
outside of official plants, or cases of economic adulteration 
in which the ability to level civil penalties, we believe, 
would be the appropriate type of enforcement to take. It would 
get companies to pay attention to these important problems. We 
believe that the bill, the authorities within the bill, would 
be very important for also filling this gap in our current 
approach toward food safety.

             REGULATORY STANDARDS FOR FRUITS AND VEGETABLES

    Senator Harkin. I hope we can get some action on that this 
year. As I said, and just to repeat for emphasis sake, 
distribution system has changed radically, but our system has 
not changed to meet requirements.
    And that leads me, Dr. Henney, into this other area of 
great concern, and that is the issue of fresh fruits, 
vegetables and produce. I dare say 15 years ago, when I walked 
into my local Safeway in the middle of winter, you did not find 
raspberries from Guatemala, and lettuce from Mexico and 
tomatoes from Mexico and Chile and places like that.
    You might have gone to one of the places like Sutton Place 
Gourmet or something like that, and maybe you would find it 
there. But now it is all over. And more and more we are hearing 
stories of outbreaks of pathogens and other problems in our 
produce, in our fruits.
    I have a two-part question. First, I understand the FDA is 
working with industry to develop some voluntary guidelines on 
produce safety. Your comment on that.
    Second--and here is what I think Senator Durbin was getting 
at--when it comes to meat and poultry inspection, we have 
national standards. We have standards that we have implemented 
by law so that if a country wants to ship meat and meat 
products into this country, we can have them meet those 
standards. And it is not a violation of the World Trade 
Organization or anything else.
    But in produce and in fruits and vegetables, we do not have 
those. So that if we try to do something, they will claim it is 
a violation of WTO. And they are probably right, because we do 
not have these national standards.
    So I want to get to the issue of absence of regulatory 
standards for fruits, vegetables and produce and how that 
hampers our ability, not only here but also abroad.
    Having said that, I will give you a heads up. I am working 
on legislation--I have talked to you about it--to set Federal 
standards in these areas I think a lot of people probably think 
we have, these standards now, but we do not. So I would like 
any comments that you have on that line.
    Basically, are you working on the voluntary guidelines? 
Second, this whole issue of domestic regulatory standards and 
how that is hampered.
    Dr. Henney. Senator Harkin, let me take the first part of 
your question and ask the Director for the Center for Foods, 
Mr. Joe Levitt, to join me in terms of giving you a more 
comprehensive response in respect to the second part of your 
question.
    I think that the voluntary standards or the work that we 
have with industry with respect to fresh fruits and vegetables 
has been the subject of a guidance document that was issued 
recently. It is contained in this booklet. It is the first step 
and first approach to try to get a handle on the issue that you 
raised.
    One issue is our having access and availability of fresh 
fruits and produce to us year round from many different sources 
and yet trying to minimize any particular microbial infections 
that may be present on that food, whether it is domestic or 
imported. But let me ask Mr. Levitt to respond to the second 
part of your question.
    Mr. Levitt. The first part, also, the guide that Dr. Henney 
held up, was produced last year using the funds that the 
Congress provided for fiscal year 1998. For fiscal year 1999 we 
are actively working with colleagues at the Department of 
Agriculture to roll out that guide to fresh fruit and vegetable 
processors, both domestically and overseas.
    We are working with Dr. Kennedy's group domestically and 
with the Foreign Agricultural Service overseas. And we, between 
us, have two conferences that are scheduled in April in order 
to do that. And we have a joint steering committee. So that 
this is a fully coordinated effort.
    I think your question in terms of should there be more 
mandatory standards, I think that right now is more a function 
of where we are in time and on the science. We started with 
this guide largely because of what was known to date.
    A lot of the areas that Dr. Henney and others have 
mentioned in terms of a changing food supply, one of the major 
areas of the Food Safety Initiative is research into new 
methods, not just for detection, but also for prevention.
    And I think when we look at whether this should be a 
mandatory program, should it be a voluntary program, the first 
question is: What are you going to mandate? I think as a 
precursor we first need more research in what are the 
preventive controls that would be effective in reducing 
pathogens in fresh fruits and vegetables at the level that we 
would want to see.
    But in terms of where we are right now, we are--we believe 
where the science is, is at the voluntary guidance stage, which 
we think is an important first step tied to a very 
comprehensive research effort.

                          REGULATORY STANDARDS

    Senator Harkin. You asked me a question. Okay. I will give 
you an answer. For example, if we do not have mandatory 
standards on the washing of fruits and produce, and the source 
of the water that is used to clean them, how can we impose that 
on another country? We do not. If we can wash produce, and 
fruits with surface water, they can in other countries. That is 
one area. It does not take a lot of research. I do not think 
that is too highly scientific.
    Secondly, if we do not have standards on warehousing 
procedures for fruits and vegetables and produce in open 
buildings where rats can get in and birds fly through and bird 
droppings can fall on the food, if we do not do that, how can 
we mandate that in another country?
    Those are just a couple, very simple, off the shelf. I do 
not know that it requires a lot of research for that.
    Mr. Levitt. The requirements that we do have in place stem 
from our statute in terms of our general provisions against 
adulteration and sanitation. And so, I mean, the statutory 
framework does provide a basis on which we regulate both 
domestically and looking at products coming in from other 
countries. So we use a general statutory umbrella.
    I was listening to your question more in terms of should 
there be specifically targeted regulations of fresh fruits and 
produce. And as I said, we are moving in that direction. But in 
terms of what we have done so far, we have felt that, this is 
where we are right now.
    Senator Harkin. The absence--I am still trying to get to 
this central question. The absence of national standards, how 
does that inhibit you from doing your work in other countries, 
if we do not have national standards, domestic regulatory 
standards, like we do for meat and poultry? We want to get to 
the issue of produce. I am still in a little haze about the 
answer to the question.
    Mr. Levitt. Well, the first----
    Senator Harkin. We talked about the voluntary guidelines. I 
know you are working on that. I am talking about the next step, 
the next step of getting domestic regulatory standards. Now is 
your answer to my question that you do not have enough 
information or we do not have enough research, we do not have 
enough data now for domestic regulatory standards?
    Mr. Levitt. That is correct in terms of a comprehensive set 
of national standards. And that is why we moved with the 
guidance, which is where we felt the support was. We have a 
joint advisory committee, which we operate with the Department 
of Agriculture, the National Advisory Committee for 
Microbiological Criteria. This issue was raised directly, and 
these are experts from around the country in terms of what do 
we know now, what is the right step based on what we know.
    That does not mean that is where any of us would like to 
be, but we need to--in these areas, we need to both drive the 
science, drive the prevention and let the regulations reflect 
the state of science. We all are looking for science-based 
solutions, as we have with our HACCP programs.

                  OUTBREAKS FROM FRUITS AND VEGETABLES

    Senator Harkin. Dr. Koplan, what do you see from CDC in 
terms of outbreak of pathogens in produce and fruits and 
vegetables? What is your experience? I mean, what have we seen 
lately?
    Dr. Koplan. In the last few years, you know, there have 
been some widely publicized outbreaks. Raspberries of a couple 
of years ago----
    Senator Harkin. Strawberries.
    Dr. Koplan [continuing]. Strawberries, sprouts. As with----
    Senator Harkin. That was Salmonella, if I am not mistaken, 
in the sprouts, was it not? Was it Salmonella?
    Dr. Koplan. Salmonella and E. coli.
    Senator Harkin. And E. coli.
    Dr. Koplan. They, as well as most processed and unprocessed 
can be contaminated.

                            FOOD IRRADIATION

    Senator Harkin. Lastly, and I am sorry, Mr. Chairman, food 
irradiation. I remember 13 years ago, 14--it was 1985--we had a 
luncheon downtown, a bunch of us Ag types. You may have been 
there for all I know. There was a luncheon of all irradiated 
foods. We had it down at the National Press Club. I know we had 
irradiated strawberries, irradiated meats off the shelf, and 
discussed how long the shelf life would be and how it would 
destroy all these pathogens. That is 14 years ago.
    Now we are moving ahead on the meat and poultry end of 
irradiation. But it seems to me that this lends itself to 
fruits and vegetables and things like sprouts. I am just 
wondering what is happening. How come we are not moving ahead 
more aggressively in this area?
    Dr. Henney. Senator Harkin, actually we are looking at a 
variety of methodologies in terms of safe food processing. I 
was out at our district office in Chicago last week and paid a 
visit to the Moffett Center.
    They are not only looking at the issue which you raised, 
which is food irradiation, in the sprout area they are looking 
at things like chlorine washes, they are looking at high 
pressure methodology, they are looking at electron beam 
methodology, as other techniques that could be used in terms of 
interventions to make the food supply safer.
    So I think we are not only looking at irradiation as the 
only process that might help the issue of food safety.
    Senator Harkin. Well, Mr. Chairman, I just--you know, food 
irradiation, electron beam radiation right now is being used in 
the marketplace. And companies are selling these to sterilize 
pharmaceutical equipment and stuff like that, high speed. So if 
they can have it, why could it not happen with food?
    I always had a question why we could not move to that 
system. That would seem to me to almost give you the highest 
level of assurance that you would have no pathogens on your 
food, at least when you bought it. What you did with it after 
that is your own--that is up to you. But at least when you 
bought it in the store, you would have a high level of 
assurance there would not be any pathogens there.
    Thank you.
    Senator Cochran. Thank you, Senator.
    Senator Dorgan.

              INSPECTION OF IMPORTED FRUITS AND VEGETABLES

    Senator Dorgan. Mr. Chairman, thank you. I will be brief. I 
regret that we had a classified hearing this morning on energy 
and the Armed Services Committee on the Chinese espionage 
issue. And so I was necessarily delayed. But this is a very 
interesting and important issue. And a number of my colleagues 
have done more work in this area than I have. But I would like 
to ask just a couple questions.
    The discussion here sort of reminds me of the creative 
tension that exists on the issue of regulation. And especially 
in recent years, regulation is kind of a bad word here on 
Capitol Hill. I come down on the side of more regulation with 
respect to food.
    I think regulation is the only connection to that trust 
that Senator Harkin described when someone goes into a grocery 
store and picks up a strawberry and takes it home and eats it. 
The trust that they have that somehow that food that found its 
way to that shelf was food safe for them and their family to 
eat, I think, comes from effective regulation.
    Let me ask you a question. Food that comes into this 
country by an importer that does not meet FDA standards and you 
discover that in a refrigerated container at the dock, what 
happens to that food?
    Dr. Henney. Senator Dorgan, let me give you a little bit of 
a snapshot into what happens. We would have sampled it. We 
would have found it to be contaminated. As we are sampling, we 
have the importer hold that particular cargo until it can be 
released, when we notify them that it can be released. If it is 
found to be contaminated, it is no longer allowed in the food 
supply.
    Senator Dorgan. It is destroyed?
    Dr. Henney. I believe so.
    Senator Dorgan. My understanding is----
    Dr. Henney. I have my center director for the field 
operation here, but it is essentially held and often times 
deplaned and then--I do not know if destruction is the right 
word. So perhaps he could supply me with the correct word. But 
it is taken out of the food supply.

                      U.S. CUSTOMS-FDA COOPERATION

    Senator Dorgan. My understanding is that it is denied 
entry, but that we do not have the authority to require it be 
destroyed. I might be wrong about that. But I visited a dock 
recently, and I was particularly interested in what Customs was 
doing.
    In one of the warehouses they were unloading some frozen 
broccoli from Poland, a huge container of frozen broccoli from 
Poland. They were looking for contraband. And so I was just 
curious. I said, ``Well, do you know anything about this 
broccoli?'' Not that frozen broccoli would have any great 
appeal to me. But I said, ``Do you know under what conditions 
this might have been produced in Poland? Is this a reputable 
importer?''
    Dr. Woteki talks about the farm-to-table approach. Clearly 
we cannot do a farm-to-table approach with respect to frozen 
broccoli coming from Eastern Union.
    So I asked the Customs folks, ``Tell me about frozen 
broccoli here. Who would be here to make sure that that 
broccoli comes into our country to go to a restaurant or a 
grocery store to be sold to consumers with some confidence that 
that was not produced with an herbicide or a pesticide that 
would be prohibited here and would be harmful to our health?''
    Their answer was, ``Well, that is not Customs. That is 
FDA.''
    And I said, ``I would expect that. So how much inspection 
occurs?''
    Well, the answer was what I expected as well, that we have 
a very, very small amount of resources for a large amount of 
food coming into this country.
    And then I said, ``Well, what happens on the dock here if 
they ship in food that the FDA decides is not able to enter 
this country?''
    And they said, ``Well, the authority does not exist to 
destroy it. We cannot require the importers to destroy it.''
    So they are able to move it back someplace and then, I 
suppose, they may mix it with some other things and try to move 
it in someplace else, or ship food that is inappropriate for 
this country to some other unsuspecting population somewhere 
else.
    I would like you to look into that, because if we need to 
give you some additional authority to say to an importer that 
is trying to foist upon us some contaminated food, that if you 
try to do that, we will destroy it on you. I mean, maybe we 
need to give you that authority.
    Dr. Henney. Mr. Dorgan, Mr. Dykstra does correct me, in 
that we do not have the authority to order that it be 
destroyed. And reexportation is possible. I would like to 
assure you that the work that we do at the docks, however, is 
coordinated, and I believe coordinated quite well, with 
Customs.
    We developed a system with Customs a few years ago known as 
the OASIS system, so that we do know of product that is coming 
into the country, have a reasonably good handle on countries 
that we might have a concern about or a particular broker. So 
this is an issue that we have given quite a lot of attention 
to.
    Senator Dorgan. And I appreciate that. And I also 
appreciate the effort and the work that you are doing in these 
areas, all three agencies. I would just observe that the farm-
to-table approach, which our farmers understand and acknowledge 
is a useful thing, because they want to move to the American 
table a quality product that is free from question about 
contamination. That is in the interest of our farmers. We 
understand that.
    But I worry with the global economy and the lack of 
resources you have and the staggering job just to try to deal 
with all of this coming into the country that we do not have 
the same capability of implementing a farm-to-table program 
dealing with import of foods.
    And I guess I just ask your impression of that. What 
additional resources would you need and what kind of authority 
would you want in order to give us some measurable improvement 
in feeling that our imported food is meeting the same standards 
as the food we produce in this country?
    Dr. Henney. Well, Mr. Dorgan, with respect to budgetary 
needs of the proposal we are bringing forward this morning, 
there is money targeted to increase our level of foreign 
inspections and increase our work at the dock. And so we would 
hope that you would look favorably on that request.
    With respect to additional authorities, I would appreciate 
the opportunity to meet with you and your staff on that to see 
what might be most appropriate. I did not come with a 
particular list in that regard.
    Senator Dorgan. Let me just add my voice to the comments of 
Senator Durbin. I think it is rather byzantine that over so 
many decades has grown, I guess, a fracturing of the authority 
for dealing with food safety issues. I think it would make a 
lot of sense for us to try to pull some of that together and 
merge some of those responsibilities.
    And I understand each agency involved would have some 
concern about that. But the description, if you have a cheese 
pizza, you may not be inspected in a decade, and if you have a 
pepperoni pizza, you are inspected every day, consumers might 
wonder about a government that decides that that is the right 
approach.
    And that is just because all of this has developed over a 
good number of years, and we have not stopped to bring it all 
back together in a way that I think would make some sense.
    Well, Mr. Chairman, I was necessarily late. You are good to 
allow me to question at the end.
    And let me just thank the agencies for coming. I also share 
Senator Durbin's critical concerns that much of this really 
relates to us here in the Congress. You know, we need to 
provide the resources. If we decide what we want with respect 
to food safety, we need to provide the resources. If we believe 
reorganization is necessary, we have to do that.
    And so I look forward--the leadership of the chairman of 
this subcommittee is very important. And I admire the work he 
has done. I look forward to working with other members of this 
subcommittee on these issues.
    Thank you very much.

                   INTERAGENCY FOOD SAFETY INITIATIVE

    Senator Cochran. Thank you, Senator, for your comments and 
your participation in our hearing and in the work on these 
issues.
    Let me ask a couple final questions before we conclude our 
hearing. There has been some comment about the President's Food 
Safety Initiative. Our panel has mentioned that in statements 
that have been presented to the committee this morning. And 
there is some confusion in my mind about what is and what is 
not a part of the President's Food Safety Initiative. We see, 
for example, that FDA's seafood HACCP funding is counted as a 
part of this initiative, but the FSIS HACCP program is not.
    When you look at the entire budget of the Food Safety and 
Inspection Service, $600 million plus, only $18 million of that 
is counted. The President's budget does not even request 
funding for a lot of the mandated programs of the Food Safety 
and Inspection Service.
    On the other hand, there are some other programs where the 
base funding of ongoing activities that predate the 
announcement of the President's Food Safety and Inspection 
Service are counted in the funding levels for the Food Safety 
Initiative.
    So it is very confusing. Can any one of you help us define 
what the President's Food Safety Initiative is and is not? Dr. 
Woteki?
    Dr. Woteki. I will take a run at that, Senator. It is 
actually all laid out in that May 1997 report to the President. 
In that report we identified, we collectively, the agencies 
here, six areas that were gaps that were not receiving 
sufficient attention and funding for particular emphasis in a 
budgetary initiative.
    One of the six areas was the development of a surveillance 
system at CDC that would help us in responding much more 
quickly, first to identify outbreaks of disease and then to 
help in response.
    The report proposed additional funds for risk assessment, 
an area that we are increasingly relying on, but for which we 
need methods developed, and also funding to conduct some of 
these risk assessments.
    In the case of the Food and Drug Administration, their 
inspection programs are identified in that report as being 
areas in which, particularly for the food system, they have 
responsibility for the food sector which was an area in which 
an infusion of new funds was identified as being badly needed.
    We also identified research in the report as being an area 
in need of a focused infusion, a focused investment, of new 
funds, particularly emphasizing pathogens in foods, as well as 
some areas that we are particularly concerned about: the 
development of resistence to traditional processing approaches, 
heat tolerance, for instance, in pathogens, or increasing 
resistence to antibiotics because of use in food animals. These 
were areas of research that if we had some additional funds, we 
could make some real breakthroughs.
    We also identified education, farm-to-table, but in 
particular with an emphasis on consumers as being an important 
area for additional new funding as well. So these half-dozen 
areas in that initial report in 1997 is really a kind of 
roadmap to the President's Food Safety Initiative.
    In addition, that report also identified and committed us 
to doing some longer range strategic planning, which is now 
being undertaken under the auspices of the President's Council 
Food Safety.
    Senator Cochran. Dr. Henney, do you have any comments about 
that?
    Dr. Henney. No. I believe that Dr. Woteki has outlined very 
well the areas that were identified specifically for the Food 
Safety Initiative. You are very right. We have many other 
activities in the food arena where we are making requests for 
budgets or asking for funding in particular types of ways. But 
I think the areas that Dr. Woteki has identified have been 
consistent through the Food Safety Initiative.

             PROPOSED RULEMAKING ON IRRADIATION OF RED MEAT

    Senator Cochran. Dr. Koplan, any other comments on it? 
There is one area where we heard some comment this morning, and 
it is about the proposed rulemaking issuing a regulation 
governing irradiation of red meat. We understand this is in the 
60-day comment period that ends in April, at the end of April.
    My question is: At the close of the comment period, what do 
you anticipate in terms of the agency implementing rules or 
regulations to make this added food safety technology available 
to industry? What is the timeframe that is anticipated?
    Dr. Woteki. Well, I think to a certain extent that is going 
to depend on the nature of the comments. They will be reviewed 
promptly. Clearly, this is a high priority for us to do a 
prompt review and response. At this point, I have not 
personally looked at the comments that have been received, so I 
do not have a sense for how complex they are, what kind of 
challenges they are going to offer.
    If the responses that are coming in are generally 
favorable, there should be little impediment then to a rapid 
review and issuing of a final----
    Senator Cochran. Is this process similar to a public 
opinion poll, or is it science-based?
    Dr. Woteki. Well, it is most definitely science based. As 
part of the comment period on any of our rules, we frequently 
data submitted from the industry, from academic scientists and 
from others that needs to be reviewed and taken into 
consideration.

                         FOOD SAFETY EDUCATION

    Senator Cochran. One thing that always strikes me as 
interesting in news reports about foodborne illnesses or so-
called outbreaks--which you have reminded us is two or more 
people suffering from the same malady, I guess, as a result of 
a foodborne contaminant--is that after the initial big headline 
and the first couple of paragraphs, there is the line in there: 
But if the food, whatever it is, was cooked, there is no danger 
of illness, or less likely danger, than we have just been 
advertised exists.
    I wonder to what extent are the agencies involved--CDC may 
be involved in this, too--in trying to help ensure that we all 
have all of the story, and we get the information that we need 
in order to make judgments, not just about an overall 
impression of the quality of the food that we have access to, 
but how we should prepare it, the thorough cooking that is 
required, the handling of food, and the like. Are we doing 
enough in that area? And, does this budget provide the funding 
that you need in order to have outreach programs that make a 
difference in this area?
    Dr. Henney. Let me take a crack at that. I think one of the 
programs that we are all very much committed to, that Dr. 
Woteki mentioned in her testimony, was the FightBAC! 
TM campaign.
    And that is to have consumers keep constant vigilance in 
terms of the things that they can do to make sure that their 
food is safe. It comes down to chilling, cooking, cleaning and 
making sure that there is no cross-contamination as they 
prepare food.
    And I think from the individual consumer, who is preparing 
food in the home, to particularly people who are preparing food 
for others, those kind of four basics need to be very strongly 
ingrained.
    We have taken, as a part of the Food Safety Initiative, 
this educational program very seriously. I think that we are 
trying to impress this message far and wide. I know that, 
speaking for the FDA, we have undertaken many an initiative 
using the basic structure of the FightBAC! TM really 
all across the country using our district offices as the hub 
for outputting that kind of message.
    But I do take your point that there are things that we need 
to do all the way through the system, anywhere from that first 
preparation of a product, to an inspection, all the way to the 
table that is important to make sure that our food is safe.
    Senator Cochran. Well, there is some discretion, too--I do 
not know which agency maybe has the controlling authority--on 
which kinds of contaminations are advertised or given great 
notice. It is almost like the federal Government decides which 
episode to release and which not to release. Is that true? That 
is coming to me through some of the material that I have 
reviewed in preparation for this hearing. I did not realize 
that there was that kind of discretion being exercised by the 
agencies.
    Dr. Woteki. Well, if you are referring to information that 
is released about recalls----
    Senator Cochran. Maybe that is it. Yes.
    Dr. Woteki [continuing]. There are different categories of 
potential hazards to the public that are used for categorizing 
each recall-type situation.
    Senator Cochran. That is what I read. That is exactly what 
I read.
    Dr. Woteki. Some of those situations, where the consumer 
has the ability to identify the product and return it, are the 
cases in which we go to the media and publicize so that 
consumers can take actions to protect themselves.
    Frequently what happens, when there is an outbreak of 
disease, and a recall is associated with it, there is a stepped 
up level of testing that is then done. So you may see a cluster 
of recalls that are related to a particular organism. That is 
what has happened with the Listeria situation that Dr. Koplan 
described in his testimony.
    There can be a clustering in time of outbreaks and then 
recalls that are associated with a specific organism.

                               FIGHT BAC

    Senator Cochran. Dr. Koplan.
    Dr. Koplan. Yes. You know, over the last 50 years we have 
probably investigated thousands of outbreaks, many of them 
foodborne outbreaks, and view all of these as an opportunity to 
educate the public about what risk factors are present and how 
to avoid future problems like this.
    I think what you see here in the FightBAC! TM 
campaign is a terrific example of something that is at the end 
of the chain of developing data, information and science. It 
begins with surveillance in the community. Are we seeing those 
2, 5, 100, 1,000 cases of something associated with a common 
food, then investigating it? Is it an outbreak? What is the 
cause. Then doing some more studies to determine what are the 
specific risk factors. Those risk factors are addressed by the 
four different elements of the FightBAC! TM 
campaign.
    We have a group of college students who begin to cook for 
themselves for the first time alone in a dorm, and they use a 
common cutting board to cut up raw chicken and then to prepare 
their salad. That is the separate piece.
    You have folks who will buy shrimp in a market and leave it 
on the counter for a long period of time and then decide to 
cook it. There are a series of elements that from our science 
background and doing case control studies, doing surveillance, 
investigating, provide the science base for health education 
program. We link all those in a chain.
    Senator Cochran. Dr. Woteki.
    Dr. Woteki. One final comment about the 
FightBAC!TM campaign is to just reemphasize that it 
is a public-private partnership. A substantial amount of the 
funding for the campaign has come from the private sector.
    In addition, the agencies here have all participated in the 
development of those messages and, as Dr. Henney indicated, in 
the distribution of that educational message.
    The current program under development under the FightBAC! 
TM campaign is going to be oriented toward school-
aged children, which is also part of what Dr. Henney referred 
to as the constant need for education and then reinforcement of 
this message at all ages, because school-aged children are also 
preparing food at home, as well as their parents. Education 
needs to be conducted throughout the age continuum.

                          SUBCOMMITTEE RECESS

    Senator Cochran. Well, let me thank all of you for your 
participation in our hearing today. I think it has been an 
excellent hearing focusing on the budget request to deal with 
the problems of food safety in our country. We will give this 
request very careful attention, and also the legislative 
proposals that are pending in the Senate, to make the process 
more efficient and more effective.
    [Whereupon, at 11:24 a.m., Tuesday, March 16, the 
subcommittee was recessed to reconvene at 9:30 a.m., Tuesday 
April 27.]


AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

                              ----------                              


                        TUESDAY, APRIL 27, 1999

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9:30 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Thad Cochran (chairman) presiding.
    Present: Senators Cochran, Kohl, Dorgan, and Durbin.

                       DEPARTMENT OF AGRICULTURE

STATEMENT OF SHIRLEY R. WATKINS, UNDER SECRETARY FOR FOOD, NUTRITION 
            AND CONSUMER SERVICES
ACCOMPANIED BY:
        SAMUEL CHAMBERS, ADMINISTRATOR FOR THE FOOD AND NUTRITION 
            SERVICE
        DR. RAJEN ANAND, EXECUTIVE DIRECTOR, CENTER FOR NUTRITION 
            POLICY AND PROMOTION
        DENNIS KAPLAN, DEPUTY DIRECTOR OF BUDGET, LEGISLATIVE AND 
            REGULATORY SYSTEMS, OFFICE OF BUDGET AND PROGRAM ANALYSIS

                            OPENING REMARKS

    Senator Cochran. This subcommittee will please come to 
order. This morning our subcommittee continues our review of 
the proposed budget for the next fiscal year that begins in 
October of 1999 as it relates to the functions and activities 
of the Department of Agriculture and the Food and Drug 
Administration.
    This morning we are concluding our hearings on this year's 
budget and we have with us to discuss the Food and Nutrition 
Service budget, Ms. Shirley Watkins, who is Under Secretary of 
Food, Nutrition, and Consumer Services; Dr. Rajen Anand, 
Executive Director of the Center for Nutrition Policy and 
Promotion; and Dennis Kaplan with the Budget Office of the 
Department of Agriculture.
    The Food and Nutrition Service manages 15 nutrition 
assistance programs funded at approximately $36 billion. The 
agency is the largest agency funded each year in the 
Agriculture appropriations bill.
    The President's budget includes proposals to improve the 
nutritional status of program recipients, continue Y2K 
compliance and fund activities to monitor and improve program 
and financial integrity.
    We appreciate very much the efforts of this Under Secretary 
to aggressively deal with problems relating to food stamp fraud 
and abuse. We hope that further success can be achieved by 
fully implementing the electronic benefit transfer program.
    The budget request also proposes that the Food and 
Nutrition Service continue its role of providing nutrition 
education and food and commodities to the general public with 
increased funding for the Food Stamp Program, The Emergency 
Food Assistance Program, WIC, and the Child Nutrition Programs.
    We will be interested in comments from the Under Secretary 
about how this budget will achieve those goals. We appreciate 
having the benefit of your written testimony and we will make 
it a part of the record in full. Before proceeding to summarize 
it, however, I'm going to yield to my distinguished colleague 
from Wisconsin, the senior Democratic member of this 
subcommittee for any comments he would like to make at this 
time. Senator Kohl.
    Senator Kohl. Thank you, Senator Cochran. I have a 
statement that I will insert into the record.

                           PREPARED STATEMENT

    Senator Cochran. It will be inserted and printed into the 
record without objection.
    [Statement follows:]
                Prepared Statement of Senator Herb Kohl
    Our hearing today is on the subject of nutrition and public health. 
I want to extend a welcome to Secretary Watkins from the Department of 
Agriculture and her associates with the Food, Nutrition and Consumer 
Services. I again want to welcome Dr. Jane Henney of the Food and Drug 
Administration.
    The last hearing before this subcommittee was on the topic of food 
safety, and in many ways it is fitting that today's hearing follows 
that subject. It is well that we dedicate resources to ensure the food 
we eat does not make us sick, but I worry that not enough attention is 
given to ensure that the food we eat makes us healthy. When I look at 
the common diets of many Americans, I grow concerned about what long-
term health risks await many of us. More and more Americans, especially 
young people, are turning more to foods of convenience than to meals of 
substance. I am especially concerned that wholesome beverages, such as 
milk, are being replaced by sodas and other less nutritious drinks, 
even in the arena of our public schools where education should include 
lessons on how to live not only a productive life, but a healthy one as 
well.
    Nutrition programs represent, by far, the largest levels of funding 
in our appropriations bill. Not only does this fact point to how 
important these programs are, but they also suggest how difficult they 
may be to manage. The effects of welfare reform of a few years ago are 
still being felt and those effects are present in the administration of 
our nation's nutrition programs. A few years ago, large carry overs in 
the WIC program, possibly one of the most successful and popular 
program's funded by Congress, raised issues about how best to manage 
the programs resources. Today, declining rolls in the food stamp 
program are resulting in surpluses far in excess of the President's 
original estimates and again bring into question how best to manage 
these programs.
    Dr. Henney joined us recently during our hearing on food safety, 
but the responsibilities of FDA are much broader in scope than that 
single topic. During our hearing on food safety, it was pointed out how 
much technology has changed and foods grown in one part of the world 
can be marketed a few days later in another part of the world. Changing 
technologies also may affect public health. Today, a person exposed to 
a deadly virus can board a plane in a distant part of the world and 
within a matter of hours that plane can touch down in Los Angeles, 
Dallas, Atlanta, or Milwaukee and suddenly a disease that once seemed 
remote is on our door step. The challenges to FDA are great and I look 
forward to Dr. Henney's testimony today as we proceed to determine how 
we can best work together.
    Senator Cochran. Ms. Watkins, welcome. You may proceed to 
describe your proposed budget in any way that you think will be 
helpful to the committee.
    We apologize to you and the other panel which will follow 
you for having to shorten the expected duration of the hearing 
because of a full committee hearing that's being called at 10 
o'clock to review the supplemental emergency request for 
military funds for Kosovo.
    We will try to complete this hearing so we can get over 
there before that ends and be a part of that hearing. You may 
proceed.

     THE FOOD AND NUTRITION SERVICE FISCAL YEAR 2000 BUDGET REQUEST

    Ms. Watkins. Mr. Chairman, thank you very much and, Senator 
Kohl, I appreciate all of the support that you have given us 
for our nutrition assistance programs at USDA. And I'm grateful 
for the opportunity to be able to present the fiscal year 2000 
budget request for the agency.
    With me in the audience is the Deputy Under Secretary Julie 
Parodis and the Administrator for FNS, Sam Chambers.
    I'd like to begin very briefly and discuss some of the 
issues that are in our 2000 budget request which in total is a 
$36.5 billion request for the year 2000.
    About one in five people participated in one or more of our 
nutrition assistance programs. And those programs help us to 
combat critical diet and health risk factors that contribute to 
four out of ten of the leading causes of death in the United 
States.
    As you know, Mr. Chairman, we meet during a period of 
unparalleled economic success for our Nation. Nonetheless, it 
is especially important in good economic times that we remember 
the role of the public nutrition assistance programs in 
promoting the nutritional well being of low income families and 
the need for these programs by the working poor remains 
extremely strong.
    Our program that serves as a safety net for nutrition 
assistance is the Food Stamp Program which reaches one in 
fourteen people. We're requesting $22.5 billion in fiscal year 
2000 to support our food stamp requirements.

                           FOOD STAMP PROGRAM

    This includes the food stamp benefit reserve of a billion 
dollars and $1.268 billion for Nutrition Assistance Programs 
for Puerto Rico, $75 million for the Food Distribution Program 
on Indian Reservations and $100 million for commodity purchase 
for the TEFAP program, The Emergency Food Assistance Program.
    We know that food stamp participation has fallen by over 
nine million participants and that's a drop of a third between 
March of 1994 and November of 1998 and that participation is 
not surprising. But part of the drop is attributable to the 
strength of the economy and the success of Welfare Reform in 
moving families from welfare to work and part can be traced to 
the new restrictions on participation of certain legal 
immigrants and able-bodied adults without dependents. But the 
magnitude of the decline points to other factors that are a 
reason for a great deal of concern.
    Between 1995 and 1997, food stamp participation fell five 
times as fast as poverty, suggesting that many of the poor 
families that left the program have left the program despite 
their eligibility and these working families, especially those 
leaving the welfare system, need to be made aware that they may 
still be eligible for food stamp benefits.
    Although the Ag, Research Extension and Education Reform 
Act restored some food benefits, in this budget we're 
requesting an additional restoration of $10 million for those 
legal immigrants who are elderly and vulnerable.
    We propose to restore eligibility to qualified non-citizens 
with lawful permanent resident status on August 22nd, 1996, 
once they reach the age of 65.

                        CHILD NUTRITION PROGRAMS

    In the Child Nutrition Programs, which we are responsible 
for, we are requesting a total of $9.5 billion in fiscal year 
2000. These programs include the school meal programs that play 
a key role in maximizing our children's potential.
    We expect that schools will serve more free meals in fiscal 
year 2000 and there are several possible explanations for this 
trend.
    First, we have direct certification for many children who 
are eligible for free meals even though many of them wouldn't 
have been eligible with an application, but they do come 
forward in direct certification.
    And, second, Title I funding is tight and there is a strong 
incentive in school districts to identify the number of 
children who are eligible to receive free meals.
    And, finally, the technological improvements have reduced 
the stigma of participation by maintaining the confidentiality 
and the identity of those eligible students.
    We currently are serving about 26 million children daily in 
the School Lunch Program and that's about 50 percent of the 
total enrollment. But participation in the breakfast program is 
only about 7 million and then only about 16 percent of low 
income children in the School Lunch Program participate in the 
Summer Food Service Program.
    So we plan to make these programs more accessible to more 
children so that they will have benefits of good nutrition.
    The reauthorization proposal provided snacks in after 
school programs. So we will be working aggressively to ensure 
that that participation grows in 2000 in both school programs 
and child care centers.
    The after school program has been very successful based on 
the early indications of information that we've had from the 
school districts and child care centers.
    We also in the Reauthorization Act had provision to pilot 
test a research project for breakfast in six school districts 
to determine the effects of breakfast on learning and behavior 
in schools.
    We have requested $13 million in fiscal year 2000 to do a 
very rigorous pilot study to ensure that we have the best data 
possible on breakfast and learning. To make sure that child 
nutrition programs are as effective as they can be, we have 
requested a modest $2 million to restore the Nutrition, 
Education and Training Program.
    Some people have argued that NET is no longer necessary 
since we have Team Nutrition that has been successful.
    But we need to make a clear distinction between these two 
programs. The grants that states receive under the NET program 
provides state level infrastructure that delivers the materials 
that we develop through Team Nutrition.
    The Team Nutrition funds are used to develop model 
nutrition programs. And we seriously need to look at the NET 
and make certain that we understand the difference between NET 
and Team Nutrition. Both of those programs need our support.

                              WIC PROGRAM

    The other program we are responsible for is the WIC 
program. Since early 1993, WIC participation has increased 
about 37 percent or about 2 million new clients. And in fiscal 
year 2000, our budget request is for $4.1 billion. This funding 
amount supports the President's commitment to fund the average 
monthly participation of 7.5 million.
    Between fiscal years 1997 and 1998, the average monthly 
food cost per person rose by only one-half of 1 percent while 
the general food inflation rose by only 2 percent. So we are 
doing quite well with the WIC program and very proud of that.
    We'll continue to work on WIC and look at all of the 
possible changes that we can make in the program with our new 
regulations that we have sent to OMB.
    We're also expanding the WIC Farmers' Market Nutrition 
Program which greatly benefits not only WIC participants, but 
small farmers. In fiscal year 1998, the program reached 32 
states, the District of Columbia, two Indian Tribal 
Organizations. And during fiscal year 1999, we're adding 
Alabama, Guam and two more additional Indian Tribal 
Organizations.

                      COMMODITY ASSISTANCE PROGRAM

    The Commodity Assistance Program. We are improving the 
nutritional quality of commodities and providing benefit 
delivery through electronic ordering and delivery system and 
it's called electronic data interchange.
    In fiscal year 2000, we are requesting $152.2 million to 
support the commodity assistance program which includes an 
additional $5 million to support the expansion of the Farmers' 
Market Nutrition Program and this increased from $15 million in 
fiscal year 1999.
    We're also making major changes to our commodity 
distribution program. So you will notice that we have a 
reinvention program for commodity distribution program that 
involves ASFSA and our state commodity distributing agencies as 
well as the industry.

                          FOOD PROGRAM ACCOUNT

    In addition, our FPA account which is our Food Program 
Administration account, we're requesting $119.8 million and 
that's an increase of $11.3 million.
    We've requested this to support our strategy of achieving a 
higher level of effectiveness in concert with our state 
partners in the integrity and oversight of our food assistance 
programs.
    In each program, whether it's WIC, food stamps, commodity 
distribution, school meals, we've placed nutrition as the 
foundation of all of our policies and all of our activities 
including staffing changes so that nutrition is reflected.
    We've developed educational materials which we are sharing 
between programs with a consistent nutrition message so that 
there is no confusion on what we're trying to accomplish.
    We're also working very closely with the Human Nutrition 
Research Laboratories as well as ARS, CSREES and other USDA 
mission areas. We believe that it is the role and 
responsibility of the Department of Agriculture's Food, 
Nutrition and Consumer Services to deliver a consistent 
nutrition education message across programs.

                           PREPARED STATEMENT

    Mr. Chairman, I hope that has given you a bird's eye view 
of what we're trying to accomplish through the year 2000 budget 
request. I'll be happy to answer any questions that you may 
have or the members of the committee.
    [The statement follows:]
                Prepared Statement of Shirley R. Watkins
    Mr. Chairman and Members of the Subcommittee. Thank you for the 
opportunity to present the fiscal year 2000 budget request for the 
Food, Nutrition and Consumer Services (FNCS). As the Under Secretary 
for FNCS, I am responsible for America's domestic Nutrition Assistance 
Programs which include the anchor programs of Food Stamps, Child 
Nutrition and the Special Supplemental Nutrition Program for Women, 
Infants, and Children (WIC), administered by the Food and Nutrition 
Service. I am also responsible for the Center for Nutrition Policy and 
Promotion (CNPP) which is the lead Federal agency in promoting 
effective human nutrition. I am accompanied today by Samuel Chambers, 
the Administrator for the Food and Nutrition Service (FNS). Mr. 
Chambers was appointed to this position in August 1998. Prior to being 
named FNS Administrator, Mr. Chambers was the Director of the Michigan 
Family Independence Agency for Wayne County in Detroit, Michigan. I am 
also accompanied by Dr. Rajen Anand, the Executive Director for CNPP 
and Stephen Dewhurst, the Department's Budget Officer.
    The mission of FNCS is to reduce hunger and food insecurity by 
providing children and needy people access to food, a healthful diet 
and nutrition education in a manner which is supportive of American 
agriculture and inspires public confidence. These programs are vital to 
our Nation since about one in five Americans participate in one or more 
nutrition assistance programs. The critical importance of our mission 
is clear--poor diet is a significant contributing factor in 4 out of 
the 10 leading causes of death in the United States. Heart disease, 
cancer, stroke and diabetes which are significantly impacted by diet, 
account for 1.4 million deaths annually or about two-thirds of total 
deaths in the United States. Diet also plays a critical role in other 
health concerns such as obesity, hypertension, and osteoporosis. Taken 
together, these diet related diseases cost society an estimated $250 
billion each year in medical cost and lost productivity.
    Mr. Chairman, this Administration has led the Nation to a period of 
unparalleled economic success. With record job creation, low 
unemployment, and expectations of continued low inflation, the outlook 
for the future remains bright. Yet it is essential that in good 
economic times we remember the role of Federal nutrition assistance in 
harnessing our agricultural abundance to help low- income families. The 
need for these programs by low-income needy families remains strong.
    By fighting hunger and promoting good nutrition, these programs 
help to ensure the well-being of all Americans, as well as play a 
critical role in supporting those who are making the difficult 
transition from welfare to work. Even as we celebrate prosperous times 
for our country, let us not lose sight of the role of nutrition 
assistance in lifting families out of poverty.
                           program highlights
Food Stamps
    Food Stamp Program (FSP) participants represent a broad cross-
section of the Nation's poor. The Food Stamp Program provides a 
critical nutrition safety net for virtually all low-income people, 
including children, working poor families, and the elderly. Welfare 
reform legislation, however, has sharply tightened the eligibility 
criteria and made some groups of individuals ineligible. Many 
immigrants and unemployed adults without children are no longer 
entitled to food stamps. The Agricultural, Research Extension and 
Education Reform Act of 1998 (1998 Act) restored food stamp benefits to 
some of our legal aliens and we are thankful for that. In this budget, 
we are requesting additional restoration for those legal aliens who 
become elderly and vulnerable. We are making significant strides in the 
Food Stamp Program and our other programs, as well. Let me take this 
opportunity to give you a few examples.
    The Agency is leading the way on new benefit delivery technologies. 
By the end of fiscal year 1998, more than 50 percent of all food stamp 
benefits were issued using Electronic Benefit Transfer (EBT). FNS is 
continuing its efforts to provide needed technical assistance 
associated with State EBT implementation and to provide ground breaking 
technology in the development of a multi-program delivery system for 
WIC and food stamp benefits.
    In November 1998, the Food Stamp Act of 1977 was amended to require 
food stamp State agencies to take certain actions to ensure that food 
stamp coupons are not issued in the name of deceased individuals. Each 
food stamp State agency is required to enter into a cooperative 
agreement with the Social Security Administration (SSA) which would 
result in the SSA providing information on deceased individuals to the 
State agency. The State agency would in turn ensure that food stamp 
benefits are not issued to these individuals.
    Welfare Reform Implementation--FNS continues to support States 
Welfare Reform efforts while providing technical assistance as State 
policies evolve. On November 1, 1998, Food Stamp Program eligibility 
was restored to about 225,000 legal aliens made ineligible by Welfare 
Reform. FNS developed guidance for States on implementation and 
bilingual materials for immigrants. FNS also worked with the Social 
Security Administration (SSA) on a notice to Social Security Income 
(SSI) recipients to advise them that they may again be eligible for 
food stamp benefits.
    Claims Collection/Tax Offset--Claims collections for overissued 
food stamps increased to $200 million in fiscal year 1998, including 
over $73 million in collections from tax offset. This represents a 71 
percent increase in five years in total annual claims collected.
Child Nutrition
    FNS administers the Child Nutrition Programs, which include the 
National School Lunch and School Breakfast programs as well as the 
Child and Adult Care and Summer Food Service Programs. These programs 
serve meals to millions of children in schools and other settings each 
day. For example, in 1998 everyday more than half of all children 
enrolled in school ate a Federally supported school lunch. These 
programs are very important because providing nutritious meals and 
nutrition education to these children helps them to be more productive 
and increases their likelihood for success in school. Well-educated and 
healthy children mature into productive and healthy adults. The William 
F. Goodling Child Nutrition Reauthorization Act of 1998 (Goodling Act) 
increases our ability to help children. The Goodling Act authorizes us 
to reimburse snacks that are served to children between the ages of 12 
and 18 in after school care programs by schools that participate in the 
School Lunch Program and by child care centers that are located in low-
income areas and participate in the Child Care Food Program. In 
addition, The Goodling Act authorizes us to pilot test a school 
breakfast project in selected elementary schools in six school 
districts. These pilot test schools will provide breakfasts, at no 
cost, to all participating students. During the pilot test we will 
carefully evaluate the effect of eating school breakfast on children's 
behavior and educational performance. The Administration's budget 
provides $13 million to conduct this test.
WIC
    The Special Supplemental Nutrition Program for Women, Infants, and 
Children (WIC) continues to be one of our top priorities. The Clinton/
Gore Administration is committed to ensuring that every eligible 
mother, infant and child is provided the opportunity to receive WIC 
benefits. In fiscal year 1998, average monthly participation was almost 
7.4 million persons. The WIC Program is very important to me and others 
at FNS. We are making the effort to support this great endeavor and it 
is working. For instance:
  --FNS continues to promote breastfeeding as the best form of 
        nutrition for infants. Currently, States are spending more than 
        $51 million for breast feeding promotion. The agency sponsors 
        semi-annual meetings of the Breastfeeding Promotion 
        Consortium--health professionals representing government, 
        advocacy and public health interests in breastfeeding 
        promotion. In 1997, FNS implemented a WIC National 
        Breastfeeding Promotion Campaign, in cooperation with WIC State 
        agencies. The goal of the Loving Support Campaign is to raise 
        awareness of the importance and benefits of breastfeeding among 
        WIC-eligible women, fathers, family health care providers and 
        the public, to help create a community environment that accepts 
        and supports a woman's decision to breastfeed. Over 48 WIC 
        agencies are currently participating in the campaign by 
        creatively using the Loving Support materials--brochures, media 
        spots, posters and with consistent breastfeeding themes and 
        messages. USDA participated with the Department of Health and 
        Human Services (DHHS) in the sponsoring and development of a 
        Health Care Physicians' and Providers' Breastfeeding Support 
        Kit by Best Start. The breastfeeding kits were developed for 
        health care professionals to complement the Loving Support 
        Campaign materials which focus on consumer education.
  --Over the past 10 years, WIC per person food costs have actually 
        declined or reflected very modest increases due to the diligent 
        cost containment efforts of State and FNS partnerships. We are 
        making improvements in the integrity of the WIC Food Delivery 
        System. During fiscal year 1998, FNS issued a proposed rule 
        that would require the disqualification of any WIC vendor who 
        has been disqualified from the Food Stamp Program. In addition, 
        uniform sanctions would be established for the most serious 
        violations.
  --The agency is aggressively pursuing activities to advance EBT 
        systems that improve benefit delivery and client services in 
        the WIC Program. The agency is working with individual State 
        initiatives to research, plan, fund and implement WIC EBT 
        systems. Several States are pursuing hybrid benefit delivery 
        systems at point-of-sale which would combine on-line food stamp 
        benefit redemption with off-line WIC benefit authorization. FNS 
        has earmarked $3.5 million in grants for WIC EBT in fiscal year 
        1999.
  --FNS and the Center for Disease Control are working with nonfederal 
        partners to increase access to immunization through the WIC 
        Program. Currently, nearly three quarters of all local WIC 
        agencies assess immunization status and make appropriate 
        referrals to immunization services for children.
  --Currently, the WIC Farmers' Market Nutrition Program encompasses 35 
        State agencies, providing fruits and vegetables to WIC 
        participants. During 1998, the Farmers' Market Nutrition 
        Program was expanded to five new States--Alaska, Arkansas, 
        Florida, Georgia and Mississippi. The President's budget 
        transfers the program from WIC to the Commodity Assistance 
        Program and increases funding of this vital program from $15 
        million to $20 million to support expansion into additional 
        States.
    WIC is without a doubt one of the best nutrition assistance 
programs ever initiated. It provides mothers access to nutrition 
education, healthcare referrals, and supplemental foods rich in needed 
target ingredients that they otherwise could not afford, WIC babies 
thus get a healthier start in life.
Commodity Assistance Programs
    In our Commodity Assistance Programs, we have enhanced the 
flexibility of State and local agencies in serving needy populations--
that is, agencies operating the Commodity Supplemental Food Program can 
now serve women, infants and children and the elderly as needed. 
Although the women, infants and children population remains the top 
priority, States are no longer required to seek permission from FNS to 
convert caseload between the women, infants and children population and 
the elderly.
    Program service has been improved through redesigned inventory 
systems. Federal inventory is now replenished based on historical data, 
rather than requiring organizations to place orders five months prior 
to delivery. This significantly reduces the need for organizations to 
adjust orders and increases their ability to have the foods they need 
on hand.
The Emergency Food Assistance Program
    In The Emergency Food Assistance Program (TEFAP), the ability (in 
fiscal year 1999) for States to have latitude in using administrative 
funds for food is a tremendous plus for the program. We have been able 
to purchase a greater variety of healthful foods for TEFAP. In fiscal 
year 1998, bonus commodities donated to States reflected a significant 
increase from fiscal year 1997.
    FNS recognizes there is a critical link between nutrition and 
health. To that end, we have formed strategic partnerships to promote 
better nutrition among participants in our nutrition assistance 
programs.
    This past July, I attended a statewide meeting in Los Angeles, 
California. At that time the California Nutrition Network--a group of 
200 partners from the private, non-profit and public sectors launched 
the California 5 a Day--for Better Health campaign. The State Health 
Director indicated that this program offers the Network an opportunity 
to improve the health of Californians on a larger scale than previously 
thought possible. Mr. Chairman, this is merely one example of how FNS 
programs and our public/private partnerships can change the dietary 
habits of not just benefit recipients but all Americans. USDA believes 
people need to know how to use their nutrition assistance benefits in a 
manner to keep them healthy. We not only want to get food to the people 
who need it--we want to provide them with the skills, information and 
motivation they need to support healthy eating.
    The Administration must also ensure both the program and financial 
integrity of each program and the timely delivery of benefits to all 
qualified recipients. Our Food Program Administration (FPA) account is 
a critical component of the Agency's mission. Most of the 
administrative support for the nutrition assistance programs is funded 
from FPA. FNS staff continue to be committed to finding new and 
innovative approaches to improve program integrity and program services 
and have had numerous successes. I will have more to say concerning new 
initiatives in this account.
    In addition to the nutrition assistance programs, FNCS operates the 
Center for Nutrition Policy and Promotion. The Center is the focal 
point for advancing and coordinating nutrition promotion and education 
policy. The Center provides important research and analysis and 
collaborates with public, private and non-profit organizations to 
expand access to critical nutrition information.
                        fiscal year 2000 request
    The Administration is committed to reducing domestic food 
insecurity, and the FNCS fiscal year 2000 budget request encompasses 
critical proposals essential to achieving this objective. We at FNCS, 
are striving to promote the long-term health and productivity of 
working families and enhance public confidence through increased 
program integrity.
    Our fiscal year 2000 budget request of $36.5 billion reflects our 
commitment to the President's initiatives in Welfare Reform by 
supporting ``Welfare to Work'', as well as initiatives in the National 
Performance Review by promoting and enhancing program integrity. I 
would like to take a few moments to focus on the key aspects of the 
budget request and our policy goals. The testimony of Samuel Chambers, 
is being submitted for the record, and will present the technical 
aspects of our request.
  promoting the long-term health and productivity of working families
    We are grateful for restoration of food stamp benefits to some 
legal aliens under the 1998 Act. Nonetheless, more needs to be done to 
better serve and meet the food needs of others still vulnerable. A 
substantial number of elderly legal aliens who were in the country as 
of August 22, 1996, have not had benefits restored. Therefore, we are 
proposing legislation to restore eligibility to qualified aliens who 
were lawfully residing in the United States on August 22, 1996 once 
they have reached the age of 65.
    We are requesting $22.5 billion for the Food Stamp Program, a 
slight decrease from fiscal year 1999. This estimate includes a benefit 
reserve of $1 billion--a $900 million increase from fiscal year 1999. 
The Food Stamp Program is the primary source of nutrition assistance 
for low-income families. Its mission is to ensure that all households 
have access to healthful diets through food assistance and nutrition 
education. Although we are committed to maintaining the food assistance 
safety net for all low- income people and teaching life-long healthful 
eating habits, we also recognize the importance of implementing 
programs that help people obtain and keep jobs. As part of the Food 
Stamp Program operations, States conduct an Employment and Training 
(E&T) program to assist program participants in gaining the skills, 
training or experience that will increase their ability to obtain 
regular employment. In fiscal year 2000, we are requesting $330 million 
to support the E&T program. In addition, during fiscal year 1999 States 
will be allowed to use any unspent fiscal year 1998 E&T funds, in 
accordance with the provisions of the 1998 Act.
    Included in our request for the Food Stamp Program is $7 million to 
support a nutrition education program, a program designed to provide 
information on eligibility to underserved groups such as the elderly 
and the working poor. The full benefits of the FSP can be realized only 
if we provide the resources, the information and the skills necessary 
to enable low-income families to purchase and prepare a healthful, 
nutritional diet.
    In the Child Nutrition Programs we are requesting resources of $9.5 
billion--an increase of $331 million. Most of this modest increase is 
the result of projected increases in enrollment and the increasing 
number of children participating in the school meals programs. I am 
pleased that we have included in our request $2 million for Nutrition 
Education and Training activities. It is important to provide some 
level of funds for instructing teachers in nutrition education and 
teaching children about the relationship of nutrition and health. We 
are also requesting $13 million for a three-year school breakfast 
research pilot authorized by the Goodling Act. It is critical for 
members of Congress, parents, teachers, and school board officials to 
know the answer to the question: Does the consumption of a breakfast at 
school positively impact a child's potential for success? Finally, our 
request for resources to support the important Team Nutrition program 
remains at the fiscal year 1999 level of about $10 million.
    For the WIC Program, our request is $4.1 billion--a nominal $181 
million increase from fiscal year 1999. The request will support 
average monthly participation of 7.5 million needy women, infants and 
children receiving the nutrition education and food benefits of this 
most important assistance program and fulfill the Presidents goal of 
WIC full participation.
    In our Commodity Assistance Program (CAP), we are requesting $155.2 
million--a netincrease of $9 million. This request includes $20 million 
for the Farmer's Market Nutrition Program (FMNP), an increase of $5 
million over the fiscal year 1999 FMNP level which has been funded in 
the WIC appropriation in prior years. The $20 million request will not 
only sustain the current program level in 35 State agencies but will 
also permit continued expansion in these States and allow new States to 
join the program as well. As you know, the CAP also supports the 
Commodity Supplemental Food Program for women, infants and children as 
well as the elderly and will support the same caseload level in fiscal 
year 2000 as in fiscal year 1999; our request for TEFAP administrative 
expenses is $45 million--the same level as for fiscal year 1999.
    Finally, we are requesting $150 million for the Nutrition Program 
for the Elderly--a $10 million increase from fiscal year 1999. The 
increase will allow funding in the Nutrition Program for the Elderly to 
keep pace with the proposed increase in the home-delivered meals 
program administered by the Department of Health and Human Services. 
Alternatively, the increase would allow a slight increase in the rate 
of assistance per meal, which was eroded over the years as a result of 
inflation, to better support the meal service providers.
    In our Food Program Administration account, we are requesting 
$119.8 million--an increase of $9.3 million above fiscal year 1999. The 
full amount of the increase being requested is to support FNCS moving 
to a higher plane in concert with our State partners regarding the 
integrity and oversight of all FNCS programs. I will talk specifically 
about some of these initiatives as I address the Program Integrity 
area.
                           program integrity
    The Food and Nutrition Service is continually seeking better ways 
to improve integrity in all of the programs it administers. A few 
examples follow.
    In 1998, FNS requested and received funding from the Economic 
Research Service to initiate two new program integrity related 
surveys--(1) a study concerning the extent of food stamp trafficking 
after Welfare Reform which will update fiscal year 1995 estimates, and 
(2) a survey of successful State computer matching activities compiled 
as an easy reference document to be used by other States in finding 
solutions to their own problems.
    The Goodling Act increases the WIC program's ability to ensure that 
only eligible persons are certified for WIC. The law requires the 
physical presence of applicants and income documentation of WIC program 
participants. States are implementing procedures to comply with these 
changes.
    In 1997 and 1998, FNS expanded its program integrity efforts in the 
Child and Adult Care Food Program (CACFP). In 1997 the Agency issued 
Management Improvement Guidance for Family Day Care Homes and in 1998 
issued similar guidance for Child Care Centers. These manuals provide 
guidance in the prevention of fraud and abuse, while also providing 
better practices for training State monitors. Starting in fiscal year 
1999, and continuing through fiscal year 2003, $1 million of the CACFP 
funding, as authorized by the Goodling Act, will be used to improve 
CACFP integrity and oversight in such areas as establishing improved 
management practices for all levels of CACFP administration, enhanced 
assistance to States in their oversight responsibilities and an 
increased level of oversight throughout the Program. Also, as part of 
its comprehensive integrity strategy, the agency will reconvene the 
CACFP Integrity Task Force to assist in developing materials and 
training and providing increased on-site presence.
    Our fiscal year 2000 budget request contains initiatives that focus 
directly on the concerns of this Administration and the Congress 
regarding integrity in FNCS programs. As I indicated earlier, the 
increase in our FPA request for fiscal year 2000 supports program 
integrity. I will discuss them in three segments.
    We are requesting an increase of $6 million that will assist us in 
maintaining the accuracy of the Food Stamp Program Quality Control (QC) 
System to reduce error rates and/or avoid error rate increases. The QC 
system measures the accuracy of recipients' food stamp benefits. States 
with a high percentage of inaccurate cases face fiscal sanction and 
those with very low levels receive enhanced funding. It is imperative 
that the system remain statistically sound and legally defensible in 
order to provide accurate management information and to support State 
billings, appeals, and settlement actions. We will also implement new 
data matching programs. In addition, staff will work directly with 
States on State specific management improvements. We expect that this 
investment will save over $50 million due to reduced overpayment 
errors.
    We also recognize the importance of continuing and expanding our 
integrity efforts in the Child Nutrition Programs. Specifically, in 
addition to our Coordinated Review and audit efforts, we are requesting 
$2 million to identify and reduce errors in the School Lunch Program. 
We are concerned that free lunch participation continues to climb, 
despite reductions in poverty and improvements in the economy.
    We are requesting $1.3 million for several additional initiatives. 
First is additional staff for the oversight of State Automated System 
Development activities. In order to protect the considerable program 
and financial interests of the Federal government, it is essential that 
FNS maintain oversight of Advance Planning Documents submitted by State 
agencies. Second, in the area of retailer integrity, resources will be 
devoted to enhance FNS' ability to oversee retail store operations and 
detect and sanction stores violating program rules. Onsite undercover 
investigations will increase. Staff will ensure that retailer 
applications and re-authorizations are processed timely and thoroughly. 
Review of State and EBT processor accounting, processing and reporting 
will be enhanced. Third, additional staff will be deployed to oversee 
Food Stamp Program State administrative expenses which total about $1.6 
billion. We believe this to have enormous possibilities for cost 
reduction. With adequate oversight, we conservatively estimate 
achievable savings of 3 percent--equivalent to about $55 million. 
Fourth, resources will be used to exploit EBT data to detect stores 
trafficking in food stamp benefits utilizing the Anti-Fraud Locator 
using EBT Retailer Transactions (ALERT) system, a newly developed and 
implemented automated system that analyzes food stamp EBT transactions 
to detect possible fraudulent activity in stores. Fifth, additional 
resources will be deployed to assist in eliminating backlogs and 
implementing the FSP participation in the Department of Treasury's 
replacement of its tax and salary offset methods. Sixth, staff would be 
assigned to assist States and Indian Tribes in all aspects of the 
commodity distribution programs.
    All of these initiatives have cost saving implications to the 
American taxpayer. We believe our request represents a minimal 
investment with paybacks of enormous values.
    Finally, we are requesting funds for studies in support of the 
Agency's nutrition assistance programs. In the Food Stamp Account, our 
request is $10.7 million, in the Child Nutrition Account our request is 
$3 million; and we are requesting $3.5 million for WIC-related 
research. The absence of study and demonstration funds at FNS over the 
last few years has limited the depth of FNS support to Congressional 
staff, decreased our ability to respond to States, and restricted us 
from providing practical research-based guidance to the managers of our 
programs. The study funds are appropriately located in FNS because of 
the need to target these funds to action-oriented and program specific 
needs. FNS will use the study funds to assist in formulating its 
nutrition policy, measure program impacts and integrity, and advise 
Administration officials and Congress of the potential costs and 
effects of legislative proposals that are under consideration.
                               conclusion
    Mr. Chairman, I am sure you agree that FNCS provides a 
comprehensive nutrition safety net of services designed to assist those 
most in need. In order to successfully carry out our mission we have 
formed a cadre of coalitions and partnerships with organizations and 
agencies with a shared interest. Thanks to your support and the support 
of this Subcommittee, over the years, our programs have made a 
tremendous difference in the lives of those we serve. This concludes my 
statement. I will be happy to answer any questions you may have.

                      ELECTRONIC BENEFIT TRANSFER

    Senator Cochran. Thank you very much, Ms. Watkins. Let me 
compliment you on your efforts to strengthen the programs under 
your jurisdiction, to make sure that the benefits get to those 
who are eligible and to eliminate fraud and abuse of the 
programs.
    I've been impressed with some of the Inspector General's 
work in this area too. I think we have to recognize that that's 
been a very important aspect of the effort to eliminate fraud 
and abuse in these programs.
    We understand the electronic benefit transfer program is 
designed to deal with some of these problems of abuse. Is that 
your observation that it is being successful? And, what is the 
outlook for having 100 percent delivery of food stamps by 
electronic benefit transfer?
    Ms. Watkins. Mr. Chairman, my observation is the same as 
yours. And we are pleased that we've been able to have a great 
deal of success in working with the Inspector General. We 
expect to have by 2002, which is the scheduled date, all of the 
EBT systems in place. We're currently serving over 50 percent 
and delivering over 50 percent of the benefits by Electronic 
Benefit Transfer.
    Senator Cochran. Now is my understanding correct that when 
you have the EBT program in force in every state that it will 
be possible for those who have food stamps to carry them across 
state lines and use them in states other than those states that 
were issuing the food stamps? Is that a problem? Is that going 
to result in difficulties for grocery stores or places that 
redeem these stamps?
    Ms. Watkins. That currently is a problem, Mr. Chairman. But 
we are working on an interoperability study to eliminate that 
as a problem. And we've already begun the process and we're 
waiting for the results of that interoperability study. That 
has been a request from some states and we are working very 
aggressively on that.
    We don't see that as a problem for grocers once we get the 
interoperability working. We think that people will be very 
pleased with that.
    We had a six-month pilot that started on March 1st. And we 
will actually need to identify the cost for interoperability. 
We will be working on looking at cost during the pilot study.

                           FOOD STAMP PROGRAM

    Senator Cochran. We heard you in your opening statement 
make comments about the need to increase funds to make food 
stamps available to elderly legal aliens. You say $10 million 
is included in this request for that purpose.
    How do you come up with that $10 million figure? Is that 
based on an estimate of elderly legal aliens who would be 
eligible for the benefits?
    Ms. Watkins. Yes, it is, Mr. Chairman. And we looked at 
those legal aliens who are in the country and would not be 
eligible. We wanted to make certain that we were taking care of 
those seniors who were legal and at age 65 would be eligible 
for the program benefits.
    Senator Cochran. The budget also has a request for 7 
million additional dollars to support a nutrition education 
program for those who receive benefits from the food stamp 
program. Is this a new program and how does the agency plan to 
implement it?
    Ms. Watkins. This is an aggressive effort for us to provide 
nutrition education for food stamp recipients. Early on we had 
indicated that we wanted to serve food stamp recipients and 
provide adequate nutrition information so they could make wise 
food choices. And that is a part of that.
    We do have, in our reorganization with the staff, a person 
who is working on nutrition education in the Food Stamp 
Program. This is the first time we have had in the agency a 
person working specifically on food stamp nutrition education. 
And she will coordinate that with CSREES, ARS and ERS and our 
delivery of those services in addition to working with colleges 
and universities who are in the land grant system.
    Senator Cochran. One reason that my questions so far have 
centered on the food stamp program is that it is the largest 
program that is administered by this agency. The budget this 
year has $22.5 billion projected for food stamp benefits. Let 
me ask you this.
    We've noticed over the last few years, the budget requests 
for food stamps have greatly exceeded what's really needed as 
it turns out. I think I asked at last year's hearing why is the 
model so wrong. And if it is wrong, why is it continually used 
from one year to the next. It doesn't seem like there's any 
improvement in the projections being closer to the realities. 
It always seems to be overestimated by a considerable amount. 
Are you using any different economic assumptions this year in 
coming up with a request or how are you coming up with the 
request?
    Ms. Watkins. We're not using a different economic model, 
Mr. Chairman. One of the things that we've noticed and you may 
notice in the budget that we are asking for is funds for 
outreach for food stamp recipients.
    One of the things that has happened is that we have more 
people who are eligible and not participating in the program. 
What we've seen is that participants are increasingly going to 
food banks and soup kitchens and pantries instead of applying 
for food stamp benefits for which they are eligible. Many 
people who are a part of the TANF program or were on TANF did 
not realize that they were still eligible for food stamps.
    We've had some incidents in some states where people were 
being sent to food banks and soup kitchens. And we've indicated 
to them that those eligible recipients must be made aware that 
they are eligible for food stamps. So that's why you have the 
difference.
    As I indicated, the number of food stamp recipients is down 
dramatically. Yet the poverty rate is 5 percent. So we do have 
a discrepancy there and I can understand your concern. But when 
we have states who are sending people to the soup kitchens and 
food banks, then those people don't know that they are eligible 
for food stamp benefits and that's why we want to do an 
outreach to let people know that they are eligible.
    Senator Cochran. I have some other questions on some of the 
other programs. I'm going to defer those until my colleagues 
have had a chance to ask some questions. Senator Kohl.

                              SOFT DRINKS

    Senator Kohl. Thank you, Senator Cochran.
    Ms. Watkins, I'm concerned about the dietary habits of many 
Americans and especially our children. As you know, soft drinks 
are becoming the beverage of choice for many of our young 
people. Last month I wrote a letter to Secretary Glickman 
regarding this trend and the role that the USDA might play in 
promoting a healthy diet for young people. Would you please 
comment on this trend and provide your thoughts on how best to 
encourage our young people to consume more healthy beverages 
such as milk rather than soda pop?
    Ms. Watkins. Mr. Kohl, you're exactly right. The trend has 
gone upwards. There has been a thousand percent increase in 
purchases in schools for soft drinks and a decline of about 25, 
26 percent of the milk consumption. We are very concerned that 
our children's dietary needs are placed in jeopardy when 
schools are using those funds to supplement school funds. We do 
have a serious situation in how we need to address the 
nutrition and dietary habits of children and how we look at 
that.
    We are trying to, as you perhaps know, our regulations are 
lacking in strength to do something about the sale of soft 
drinks in schools. We are trying to address that and figure 
out--how do we change the school environment. And that's going 
to be a little difficult. We're going to need a lot of support 
if we should move in that direction.
    Senator Kohl. All right. What role could the USDA child 
nutrition programs play in this context?
    Ms. Watkins. We can develop standards and work with schools 
and provide technical assistance, but a great deal of effort is 
going to need to be developed around how you work with school 
administrators, superintendents, school principals and teachers 
in that effort. And I think we are going to need a lot of 
support from the Department of Education as we move in the 
direction of developing standards for school meals that are 
served in schools to protect the nutritional integrity of the 
program.
    Senator Kohl. All right. Thank you, Senator Cochran.
    Senator Cochran. Senator Dorgan.

                 FOOD BANKS AND THE FOOD STAMP PROGRAM

    Senator Dorgan. Mr. Chairman, thank you very much. Ms. 
Watkins, thank you for appearing today.
    Let me ask you a question about a survey released by 
Congressman Tony Hall recently. As you know, Tony heads an 
organization dealing with hungry issues. I sit on the board of 
that organization, but he's talking about the increase in the 
number of people using food banks across our country increasing 
22 percent in the last year. And, conversely, the Congressional 
Research Service reports that the number of people using the 
food stamp program has fallen dramatically in the last couple 
of years. Those two reports seem to be contradictions to me. 
Can you give us your analysis of what's happening?
    Ms. Watkins. We've had several roundtables around the 
country and many hungry tours and we are finding pretty much 
the same thing that Congressman Hall has identified in his 
information. We are seeing more people standing in line in food 
banks and fewer people actually participating and applying for 
food stamps.
    We're supporting the food bank system with TEFAP that goes 
out to food pantries and that also has increased. And we are 
proposing information on a campaign that's focused on the 
elderly and the working poor and encouraging states to inform 
their TEFAP eligible households who might be confused about 
their eligibility. So that's what we're doing.
    We need to make certain that we are strengthening our Food 
Stamp Program which is the safety net. It's our nutrition 
safety net for the working poor.
    Senator Dorgan. I support the TEFAP program and always 
have. I think if a reduction in the usage of food stamps 
indicates that there are fewer hungry people, that's wonderful. 
But that seems to be at odds with Mr. Hall's and your 
observation that you have longer lines at soup kitchens and so 
on. I don't think you answered the question. What could explain 
a substantial decrease in the usage of food stamps at a time 
when more people appear to be hungry because they show up at 
food banks and soup kitchens to be fed?
    Ms. Watkins. Partly, as I indicated in my presentation very 
briefly, it's due to the strength of the economy and partly due 
to the new restrictions for legal immigrants and the able-
bodied who are the unemployed adults without dependent 
children.
    But there are other factors in there. We currently are 
looking at some data that has been collected to help us to try 
to determine where the gaps are and where those people are who 
are eligible and not participating in the program.
    Senator Dorgan. So you think some of the restrictions that 
have been imposed are telling people who perhaps have need of 
food stamps or who are hungry that you've got to go to a food 
bank some place or to a soup kitchen. You can't access food 
stamps.
    You probably can't do it now, but give me your analysis 
later, if you would, with your staff. How do we reconcile those 
two conflicting reports? And I appreciate your tentative answer 
to it. If you have additional information, I'd like it.

                        SCHOOL BREAKFAST PROGRAM

    One last brief question, Mr. Chairman. The project on 
school breakfast relating behavior and education performance to 
school breakfast, I happen to think that's a remarkably good 
idea. But it seems to me that, as I was thinking about this, 
somebody must have evaluated that 2 years, 5 years, 10 or 20 
years ago.
    If you have a breakfast program, do students' grades 
improve? Is their behavior better? Has that not been evaluated 
before?
    Ms. Watkins. There are several studies including a study 
that was done by Harvard, including schools in Baltimore as 
well as Philadelphia. There was also a study done by the 
Minnesota Department of Education. There was an earlier study 
done by Tufts in the early eighties on school breakfast and 
performance. But there has not been a rigorous study done using 
a controlled group of students and students actually 
participating in the breakfast program.
    We have never been able to do one involving all children 
with breakfast provided for all children and that's the intent 
of the study. And there are so many different tests. We had a 
breakfast symposium last Thursday, and the science researchers 
indicated to us that the only significant piece of compelling 
evidence we have is attendance. We do know that attendance goes 
up. But we've not done a rigorous study in any of those 
universities on what happens to cognitive development, and that 
would be the intent, to find out if all children are served 
breakfast what happens to the cognitive development. Will we 
see those increases as is indicated in the Massachusetts study?
    Senator Dorgan. Ms. Watkins, I bet you and I know the 
answer to that study.
    The late Nicky Lenner and I held a hearing one day many 
years ago when a young 12-year-old boy named David Bright from 
New York said words I'll never forget. He said, ``No 12-year-
old boy like me should have to lay his head down on his desk in 
the afternoon at school because it hurts to be hungry.''
    I bet I know the answer to this study. I'm glad you're 
doing it, and I hope that all of us recognize the value of 
these programs.
    Mr. Chairman, thank you very much.
    Senator Cochran. Thank you, Senator.
    In the budget request you have $13 million, as you pointed 
out, for a pilot breakfast program. Six elementary school 
districts would participate, as I understand it, and $10 
million of the $13 million being requested is to evaluate the 
pilot program. This would be free breakfast for all the 
students in the schools as I understand it.
    How do you come up with the $10 million cost for evaluation 
of the program and only $3 million that would be used, I guess, 
to buy the food or make the breakfast available to the 
students?
    Ms. Watkins. The breakfast that we would have available--we 
already have reimbursement rates established for a school 
breakfast. So that would be those children who would not be 
eligible for a free or reduced price breakfast. And if we 
looked at the $10 million, that's necessary to cover the 
standardized test and collecting the 24-hour dietary recall and 
performing the nutrient and dietary information. This would 
involve thousands of children because we are talking about 
doing a total of 72 schools.
    Senator Cochran. How many?
    Ms. Watkins. Seventy-two schools in the six districts. So 
that we would have a control group and the group who was 
actually participating in the test.
    Senator Cochran. Have the districts been selected?
    Ms. Watkins. The districts have not been selected.
    Senator Cochran. How do you know there will be that many 
schools? Are these just geographical districts or not school 
districts?
    Ms. Watkins. These would be school districts, the six 
school districts and then you would choose 30----
    Senator Cochran. If you haven't already selected them, how 
do you know how many schools are in those districts?
    Ms. Watkins. Well, you don't. But you would end up with--72 
is what we're projecting and that's what we based everything 
on.
    One of the things that would happen is--if you don't have 
the technology in the school districts, then we're going to 
either have to do it manually or provide the new technology to 
do interoperability from the management data collected in the 
classroom and the data collected in the cafeteria. So there are 
now opportunities for connecting the two. So that may cut down 
on some expense.
    When we did this, we had no awareness at that time that 
they were looking at interoperability between what is collected 
at the cash register at point of sale and what is going on in 
the classroom and collecting that data. So that has some 
potential for dropping the cost, but we need to look at that 
very carefully as we determine the number of students and 
schools participating. I certainly would like to see that 
happen rather than trying to hand calculate all of the data 
that we're going to be looking at.
    Senator Cochran. I would encourage you to explore the 
option of having the National Food Service Management Institute 
conduct the evaluation of the program.
    Have you made a determination at this point how you're 
going to evaluate it, whether you will contract that out with 
that $10 million or would you hire new people?
    Ms. Watkins. We will have to contract this out because of 
the enormous task that will be needed in providing the adequate 
data. We certainly will take your suggestion of using the 
Institute in helping us to formulate some of the study data.

                    NUTRITION EDUCATION AND TRAINING

    Senator Cochran. The request for child nutrition programs 
includes funding of $2 million for a nutrition education 
training activity. Is that a realistic amount to be distributed 
in a nationwide program?
    Ms. Watkins. Mr. Chairman, it certainly isn't. But that was 
the amount that we could come up with and it certainly is not 
going to be adequate. But we needed to have an amount of money 
to restore NET or Nutrition Education and Training across this 
country. We have no funds in the budget for the 1999 school 
year. So we are really struggling with how we're going to and 
what we're going to be able to do with the $2 million. But it 
certainly is better than not having any moneys at all.
    Senator Cochran. The $2 million would be in addition to the 
$10 million requested for the NET program generally?
    Ms. Watkins. The $10 million is for Team Nutrition and 
that's for us to develop model nutrition education materials 
that can be delivered by those people in the states for 
nutrition education not only for school nutrition personnel, 
but also for teachers, administrators, and parents.

                     CHILDREN'S FOOD GUIDE PYRAMID

    Senator Cochran. The Department recently published a new 
children's food guide pyramid. I wrote a letter to the 
Secretary and to you, I think, about some complaints that I had 
heard about how that was developed and decisions made about 
what to put at the top and what to put at the bottom; in other 
words, the things to illustrate what is good for you and what 
is bad for you. Could you tell us what process you followed in 
the development of the new food pyramid?
    Ms. Watkins. Sure, Mr. Chairman. And we appreciate your 
interest in the children's Food Guide Pyramid. And what we did 
was to use a variety of focus groups. We used information from 
the Dietary Guidelines. And we used information that we 
received from caregivers and parents.
    This is an adaptation for young children ages 2 to 6 and 
there were no real changes. We wanted to make it so that little 
children could understand how to use the Food Guide Pyramid. We 
based it on food consumption data information for children of 
those ages, 2 to 6. And we also added physical activity. We 
used lower numbers for serving sizes.
    One of the things that we had heard from parents and 
caregivers and consumers is that they did not understand the 
original pyramid and how to use the serving sizes or they 
didn't understand what a serving size was. So we wanted to make 
that clear on the children's food guide pyramid. And we also 
included those serving sizes.
    I don't know if Dr. Anand wants to add anything that I may 
have missed.
    Senator Cochran. Dr. Anand.
    Dr. Anand. Yes. We actually took three years to develop the 
Food Guide Pyramid for Children. It really validates the 
original pyramid. The Food Guide Pyramid is based on three 
factors, as Shirley mentioned.
    One is the Dietary Guidelines. Number two is the RDA, the 
Recommended Daily Allowance. And number three is the dietary 
patterns of what children are eating. So the foods that are 
depicted on the poster are the foods that most children eat. 
Then physical activity was added.
    This research actually validates the original pyramid and 
we're very happy it does that. It is not a new thing. It's 
really the same thing. The only thing that has changed, as 
Shirley has mentioned, the food that is depicted is more 
realistic and there is also the physical activity mentioned 
there.
    Senator Cochran. In most of our experiences, the serving 
size is how much is in the container at least, that's the case 
of ice cream. [Laughter.]
    Let me ask you, was this funded from the Food and Nutrition 
Service budget or how was it paid for? Were outside groups 
involved in paying for it?
    Mr. Anand. No. The only thing that was not funded by CNPP 
was some research and focus group which were funded by FNS. All 
the money came from the budget of CNPP. There was no money from 
outside.

                              WIC PROGRAM

    Senator Cochran. On the WIC program, the request is an 
increase of $193 million to support what the budget describes 
as the ``full'' WIC participation estimate. As I understand it, 
that's a monthly average program participation rate of 7.5 
million women, infants and children.
    What evidence is there that participation will rise to that 
level of participation per month during the next fiscal year?
    Ms. Watkins. We use the same guidelines that we have used 
in the past. You might know that we are working on some new 
standards and trying to determine with the assistance of ERS 
and validate whether or not those standards are adequate and if 
we've used the right model.
    That was one of the things that we were requested to do 
last year and we're following up. So we've used the same 
standard, Mr. Chairman, this year as we've used in the past for 
WIC.
    One of the things that happens to us in trying to ensure 
that we're meeting the mark on those WIC numbers, the states 
work really, really hard to stay within their budget. They know 
that they cannot go beyond the numbers for WIC. So they monitor 
those very carefully. And oftentimes they are afraid to go 
beyond that.
    So the numbers are very, very fragile if you look at what 
we do in trying to keep the numbers within the state's budget. 
So it's very difficult for us to get an exact number because 
those numbers fluctuate. So with the new model, we are hopeful 
that we can come up with something either better or validate 
that the model that we're using is adequate.
    Senator Cochran. Does this same optimism apply to the 
average cost of per person per month, which includes a food 
cost ingredient. I understand that the estimated WIC package 
per person cost per month for 1999 is $44.47 and that it's 
projected in the budget to increase to $45.46 in fiscal year 
2000.
    I'm curious to know whether or not this is in line with 
other rates of inflation that are being assumed in the budget 
or whether this is a separate analysis and how you come up with 
that projected food cost increase of 79 cents per person per 
month? And, what is the basis of the projected increase in 
administrative costs as well, which are expected to increase 20 
cents per participant per month from fiscal year 1999 to fiscal 
year 2000?
    Ms. Watkins. We're continuously working with the states to 
ensure that their food costs are in line. We've worked very 
aggressively.
    I was in California last week and they are working with 
their states--working with the state to determine whether or 
not they are living within the current milk prices. And they 
are working to keep those milk prices down so that their costs 
are down. And they are going to end up saving over $20 million 
which would allow them to provide more WIC benefits to clients.
    So the states are working very hard. Now that's the 
standard inflation rate that we've used and it was provided by 
OMB. So that's the standard rate.
    Senator Cochran. I have some other questions on the WIC 
program particularly how you come up with the carry-out 
estimates and other projections that are made in this program 
which we will just submit and ask you to answer for the record.
    On one part of the program, the farmers market nutrition 
program for WIC beneficiaries, is there any evidence that this 
program increases with participants consumption of fresh fruit 
vegetables?
    Ms. Watkins. It does, Mr. Chairman. And we're real proud of 
that because in some instances our WIC recipients do not have 
access to fresh fruits and vegetables. And we're using this as 
a way to help them increase their fruit and vegetable 
consumption which is a real concern for us for all of our 
program recipients.
    Senator Cochran. Thank you. Senator Kohl, do you have any 
additional questions?
    Senator Kohl. I have no additional questions. Thank you.
    Senator Cochran. My good friend from Illinois has arrived, 
former chairman of this subcommittee on the House side.

                            WIC BUDGET CUTS

    Senator Durbin. Thank you very much, Mr. Chairman and 
Senator Kohl.
    I apologize for being a little late and I wanted to ask a 
question. Perhaps my colleagues here can help me with the 
answer. If I'm not mistaken, in the debate on the budget 
resolution, there was a suggestion of some rather substantial 
cuts in domestic discretionary spending.
    Some protection was put in the budget resolution for the 
Department of Defense and some education programs. It is not my 
recollection that there was any protection put in there for the 
WIC program. Is that correct?
    Ms. Watkins. That's correct.
    Senator Durbin. And if I'm not mistaken, the agencies that 
were not protected, as we calculated it, could face up to a 12 
percent cut in their budgets from this year's current 
appropriation.
    Do you have any calculation as to what the cuts might be in 
WIC if we followed the budget resolution as enacted by the 
Senate and the House?
    Ms. Watkins. It's based on what Dennis has advised me. 
We're talking about some 900,000 recipients in the WIC program.
    Senator Durbin. Being eliminated?
    Ms. Watkins. Yes.
    Senator Durbin. Out of a total universe of how many?
    Ms. Watkins. 7.5 million.
    Senator Durbin. 7.5 million currently served and 900,000 
would be eliminated?
    Ms. Watkins. Right.
    Senator Durbin. I can recall in my earlier incarnation in 
the House that someone said that one out of four infants in 
America is served by the WIC program. Is that statistic still 
accurate?
    Ms. Watkins. Yes, it is.
    Senator Durbin. So that does not include all of the 
potential infants and mothers who could be served, could be 
eligible for this program, does it?
    Ms. Watkins. Correct.
    Senator Durbin. The 7.5 million represents what percentage 
of eligible mothers and children for WIC services?
    Ms. Watkins. The 7.5 indicates 80 percent of those who are 
eligible and that's the formula that we've used.
    Senator Durbin. So roughly it's somewhere under 10 million 
eligible, 7.5 million currently served and our budget 
resolution, unless something is done in terms of the 
allocations to this subcommittee and others, could result in 
about 900,000 being removed. Is that an accurate statement?
    Ms. Watkins. Right.
    Senator Durbin. I think that is a serious problem for those 
of us who believe that WIC is absolutely essential for healthy 
mothers and healthy babies. That is a step backwards. That is a 
step toward the dark ages of our failing to realize the 
importance of this program.
    I sincerely hope that Senator Cochran and Senator Kohl and 
myself and others can prevail on those who are making the 
budget allocations to make certain that the WIC program does 
not lose ground and perhaps gain some ground so that more and 
more children can be born with the possibility of a good start 
in life.
    Thank you, Ms. Watkins. Thank you, Mr. Chairman.
    Senator Cochran. Thank you, Senator.
    Ms. Watkins, that concludes our questions of you and this 
panel appreciates very much your cooperation with our 
committee. We look forward to working with you during the 
balance of the year.

                          SUBMITTED QUESTIONS

    Ms. Watkins. Mr. Chairman, I want to thank you and this 
committee because without your support and help we would not be 
able to do the kind of job that we do. And we certainly 
appreciate all of the work that you do in helping us to provide 
the very best that we can for the people who are most needy in 
this country. Thank you very much.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                 Questions Submitted by Senator Cochran
                           food stamp program
    Question. Interoperability and portability of food stamps will 
involve limited costs of electronically routing transactions across 
state lines. Will the interoperability pilot program validate the 
costs?
    Answer. We are hopeful that the interoperability pilot project will 
provide better information as to how much interoperability would cost. 
This project, on which the Food and Nutrition Service (FNS) is working 
with States and the Electronic Benefits Transfer (EBT) Council of the 
National Automated Clearinghouse Association (NACHA), began in March 
1999 and will run through September 1999. Most interested parties 
believe the actual cost for nationwide interoperability would be low 
and we expect this study to support that belief.
    Question. Would USDA be able to pay these costs using savings 
achieved by electronic conversion, given the need to no longer lease 
terminals on state borders which allow food stamp recipients to shop in 
either state?
    Answer. FNS has no authority to pay 100 percent of the costs of 
interoperable EBT transactions. Our statute provides for sharing State 
costs for administering the Food Stamp Program at a 50 percent 
reimbursement rate. Contracts for EBT services are between each State 
and its vendor or vendors. FNS is not a party to EBT contracts and does 
not directly pay for EBT services. FNS reimbursement to States has a 
special limitation that operational costs must not exceed those of the 
paper issuance system being replaced. This cost neutrality limitation 
was part of the legislation allowing EBT as a State issuance option for 
Food Stamp Program (FSP) and remains in place although legislation now 
mandates EBT for the FSP by October 2002.
    We have supported interoperability by initiating technical 
specifications for EBT data, developing our Retailer EBT Data Exchange 
system, and working with NACHA on the Quest Operating Rules. We support 
States that chose to include interoperability as part of the services 
procured through their EBT contracts. Of course, we will reimburse 
States for 50 percent of all their EBT costs, including any fees for 
transactions across State lines, as long as the cost neutrality measure 
is not exceeded.
    We, as well as most other EBT observers, expect the cost for 
interoperability to be low. We believe the interoperability study being 
conducted with NACHA may show the costs to be even lower than those 
expectations. These are costs that we believe would be easily covered 
by the EBT savings realized by both the Federal and State governments.
    With regards to terminals installed across State borders, we do not 
have data on how many stores are equipped across State borders, though 
we believe the numbers are relatively small. We are hoping to get 
additional information on these retailers through the interoperability 
project currently underway.
    However, it should be noted that EBT contracts generally hold that 
border stores are to be equipped in accordance with State-established 
criteria, and State contract prices generally do not increase as more 
stores are added. Consequently, there is typically no incremental cost 
in EBT contracts that can be attributed to additional border stores. 
Moreover, at least in preliminary discussions, EBT contractors are 
saying that they will not reduce their charges to States if already-
equipped border stores no longer need to be equipped.
    Question. In November the Food Stamp Act was amended to require 
food stamp State agencies to enter into a cooperative agreement with 
the Social Security Administration (SSA) to ensure that food stamps are 
not issued to the deceased. What is the status of these cooperative 
agreements, and how do the agencies plan to ensure that food stamps are 
not issued to the deceased?
    Answer. Prior to the enactment of Public Law 105-379 (an Act to 
amend the Food Stamp Act of 1977 to require food stamp State agencies 
to take certain actions to ensure that food stamp coupons are not 
issued for deceased individuals, to require the Secretary of 
Agriculture to conduct a study of options for the design, development, 
implementation, and operation of a National database to track 
participation in Federal means-tested public assistance programs, and 
for other purposes) on November 12, 1998, FNS and SSA engaged in 
discussion to determine the best method for exchanging SSA's Death 
Master File (DMF) data with food stamp State agencies. Two options were 
discussed--making minor system modifications to SSA's State 
Verification and Exchange System (SVES) or advising the State agencies 
to purchase the DMF data from the Department of Commerce. An agreement 
was reached in which SSA would make the modifications to SVES.
    SSA recently advised FNS that it has now determined that more 
extensive system modifications will be necessary to make the DMF 
available through SVES.
    FNS intends to work with SSA to develop a new work plan for 
incorporating death match into SVES.
    Question. The Community Food Security Grants Programs are funded 
from the Food Stamp program account. What other grant programs are 
funded from this account?
    Answer. Funds for local versions of the Food Stamp program are 
provided to The Commonwealth of Puerto Rico, the Commonwealth of the 
Northern Mariana Islands and to American Samoa. These grants are made 
in fixed amounts. Other grants from the Food Stamp Program account 
include: grants to Tribes for administrative expenses in the Food 
Distribution Program on Indian Reservations (FDPIR) which are 
negotiated between the individual Tribe and the appropriate FNS 
Regional office; grants to States for food stamp administrative 
expenses in which FNS matches State expenses dollar for dollar; grants 
for food stamp Employment and Training (E&T) which are distributed on a 
formula basis to States to cover 100 percent of their E&T costs and E&T 
grants to States for expenses over their share of the 100 percent 
grants and to cover participants job hunting expenses, both of which 
match States expenditure dollar for dollar.
                     commodity assistance programs
    Question. Commodity assistance programs are now required to 
replenish their inventory based on historical data, not by placing 
orders five months prior to delivery. How has this new requirement 
affected the cost of running the program?
    Answer. The primary purpose for redesigning the system was to 
improve customer service. Using historical data to determine the types 
of commodities to be purchased will help ensure that the types of 
commodities preferred by program participants are available on a timely 
basis and spend less time in Federal, State and local inventory. The 
historical data approach is used only in FDPIR and the Commodity 
Supplemental Food Program, which are food package programs and, 
therefore, need an adequate supply of specific foods to meet program 
requirements. This approach has not affected the cost of administering 
these programs. In fact, it has the potential to reduce costs. While we 
have yet to see any reductions in inventory because of major changes in 
the food package, the process of placing orders much closer to the time 
when the food will actually be needed can reduce the length of storage 
time and the amount of inventory necessary to sustain service to 
program participants. This will result in reducing storage costs 
incurred by Indian Tribal Organizations and State agencies.
                            elderly feeding
    Question. The fiscal year 2000 budget request proposes a $10 
million increase for the Nutrition Program for the Elderly so that this 
would allow a slight increase in the rate of assistance per meal. How 
much does the agency expect that the rate of assistance per meal will 
increase?
    Answer. Since fiscal year 1995, funding and participation in the 
Nutrition Program for the Elderly (NPE) has been as follows:

----------------------------------------------------------------------------------------------------------------
                                                                       Reimbursement per meal    Number of meals
                Fiscal year                       Appropriation
----------------------------------------------------------------------------------------------------------------
1995.....................................         $150,000,000                   $0.5973            251,060,000
1996.....................................          150,000,000                    0.5864            246,394,000
1997.....................................          140,000,000                    0.5857            247,306,000
1998.....................................          140,000,000                    0.5607            249,918,000
1999.....................................          140,000,000                    0.5540       \1\ 252,667,000
----------------------------------------------------------------------------------------------------------------
\1\ Estimate.

    The appropriation for NPE was decreased from $150 million in fiscal 
year 1996 to $140 million in fiscal year 1997 and has remained at this 
level for three years. However, since fiscal year 1996, the number of 
meals served has increased by 6,273,000, thus reducing the rate of 
reimbursement from $0.5973 in fiscal year 1995 to $0.5540 in fiscal 
year 1999 (a drop of $0.0433 per meal). The $10 million increase in 
funding requested for fiscal year 2000 would allow for a rate of about 
$0.5935 per meal assuming service of about 252.7 million meals. The 
amount of additional funds requested would result in an increase of 
$0.0395 in the reimbursement rate over the fiscal year 1999 rate, but 
the rate would still be $0.0038 less than the fiscal year 1995 rate, 
assuming participation remains steady at the fiscal year 1999 estimated 
level.
                         school breakfast pilot
    Question. The Goodling Act authorizes the Food and Nutrition 
Service to pilot test a school breakfast project in selected elementary 
schools in 6 districts. How will the 6 districts be chosen for the 
pilot program?
    Answer. School district selection will be structured to ensure that 
the demonstration can assess the feasibility and impacts of a universal 
breakfast program in a wide variety of different school districts. 
Although specific selection criteria are yet to be determined, FNS 
anticipates that school districts will be selected to ensure diversity 
on a number of district characteristics including geographic region, 
community type (urban, suburban, rural), school district size, and 
economic levels of students' households.
    Question. Will the pilot be in only one State or several?
    Answer. To ensure diversity among pilot school districts it is 
anticipated that these districts will be selected from a number of 
different States.

    Question. Is Mississippi being considered as an option for the 
pilot program?
    Answer. Selection of the pilot sites will not take place until 
funding is appropriated for the study. If Mississippi nominates school 
districts to participate in the pilot, those districts will receive the 
same consideration as all school districts nominated by other State 
agencies. Final selection criteria have not yet been determined, but 
will be structured to ensure that a reliable and valid evaluation can 
be conducted.
    Question. What is the protocol for this pilot program, including 
the evaluation?
    Answer. A study design and general framework for assessing the 
educational and nutritional outcomes, behaviors and attitudes 
associated with participation in a universal-free school breakfast 
program is currently being developed. This document will identify key 
evaluation design and implementation issues that must be resolved for a 
robust evaluation including:
  --specification of the treatment and comparison and/or control 
        groups;
  --means of assigning groups to a treatment condition;
  --sample design considerations including sizes and characteristics of 
        each group identified;
  --data collection strategies including frequency and nature of data 
        collection;
  --required response rates;
  --relevant outcome measures and controlling variables on which data 
        will be collected;
  --and analyses of data to be collected.
    FNS expects that a pretest-posttest control group design will be 
used. Within each of the selected districts, an equal number of schools 
would be randomly assigned as universal-free schools and control 
schools. To permit the evaluation of pilot projects to distinguish the 
effects of the pilot projects from other factors, schools selected as 
treatment and control sites within the chosen districts should exhibit 
similarities on a number of school characteristics such as school 
enrollment, student academic proficiency and economic levels of 
students' households. Measurements would be taken before and after 
implementing the universal-free breakfast program. Where necessary, 
statistical adjustments will be used to enhance group comparability.
    Question. Will one protocol be used in all 6 districts or will each 
participating district have its own protocol?
    Answer. FNS anticipates that protocols will be established so there 
is replication of the treatment across different pilot sites. Allowing 
each participating district to establish its own protocol would 
seriously hamper the study's ability to attribute any observed effect 
to the universal-free breakfast program.
                        child nutrition programs
    Question. In the fiscal year 2000 budget proposal there is an 
increase in the appropriations for Team Nutrition and for Coordinated 
Review so that Federal staff can operate the program in lieu of State 
personnel. How does this improve the program integrity and reduce costs 
of the programs?
    Answer. The only increases proposed for these two programs is to 
fund the cost of pay raises for Federal employees. The reference to 
Federal staff operating the program in lieu of State personnel is an 
error. That reference applies to State Administrative Expenses (SAE) 
funds used by Federal employees when the Federal government is required 
to operate programs when the State is unable or unwilling to do so.
    Team Nutrition is a Departmental effort which provides States and 
schools with nutrition education materials for children and families, 
and technical assistance materials for school nutrition service 
directors, managers and staff. State agency partners provide training 
and technical assistance to support these programs in local schools. 
The guidance provided under Team Nutrition helps ensure that program 
meal requirements are adhered to and meals served to children are 
healthful and nutritious.
    The Coordinated Review Effort (CRE), on the other hand, is a 
uniform system of review procedures used by both State agencies and the 
Food and Nutrition Service (FNS) to assess the accuracy of the claims 
for reimbursement submitted by school food authorities through on-site 
evaluations of program operations. CRE was developed in consultation 
with State agencies as a management tool to improve regulatory 
compliance and program accountability in the National School Lunch 
Program (NSLP). In addition to program oversight, FNS has developed 
handbooks and other technical assistance materials to be used by States 
in carrying out their CRE responsibilities. As a result of this 
activity, program integrity is strengthened and costs reduced by 
helping ensure that program meals are served to eligible children and 
supported by accurate meal counts.
    Question. Please provide a detailed accounting on how the funds 
made available for the school meals initiative have been used in fiscal 
years 1998 and 1999, and what is proposed for fiscal year 2000?
    Answer. The following table provides a detailed accounting on how 
the School Meals Initiative funds have been used by spending category. 
The fiscal year 1999 allocations represent the current spending plan 
and the fiscal year 2000 allocations are projected.

                                  SCHOOL MEALS INITIATIVE: SPENDING BY CATEGORY
----------------------------------------------------------------------------------------------------------------
                                                                                    Fiscal year     Fiscal year
                                                                    Fiscal year        1999            2000
                                                                       1998         (estimate)      (proposed)
----------------------------------------------------------------------------------------------------------------
Food Service Training and Technical Assistance:
    Technical Assistance Materials..............................      $2,023,499   \1\$2,991,400   \1\$1,900,000
    Print and Electronic Food Service Resource Systems..........         475,000         475,000         475,000
    NFSMI Cooperative Agreement for Food Service................         500,000         800,000         800,000
Children's Education Resources..................................         549,166     \1\ 787,600    \1\1,700,000
    In-school Education Materials
    Community Education Materials
Food Service Training Grants to States..........................       4,000,000       4,000,000       4,000,000
USDA/FNS Direct Training and Education..........................          27,050         ( \2\ )      \2\ 50,000
Children's Communications and Technology........................          50,000          50,000         200,000
Team Nutrition Partnership Support..............................          92,364         337,000         300,000
    Resources for Team Nutrition Schools
    Partnership Network Support
Evaluation & Administration.....................................         282,921     \3\ 559,000     \3\ 583,000
                                                                 -----------------------------------------------
    Total.......................................................       8,000,000      10,000,000     10,008,000
----------------------------------------------------------------------------------------------------------------
\1\ Includes resources for the Child and Adult Care Food Program (CACFP) and Summer Food Service Program (SFSP).
\2\ No direct training is planned for fiscal year 1999. The NSLP and CACFP meetings are planned for fiscal year
  2000 that should include direct training and education to Program cooperators.
\3\ Includes full funding of the staff years allocated to the School Meals Initiative.

    Question. Identify and include the use of any unobligated balances 
from funds provided in fiscal years.
    Answer. The following table provides a breakdown of funds obligated 
in the year in which appropriated and funds carried over into the next 
fiscal year. The fiscal year 2000 budget estimates that all of the 
funds available in fiscal years 1998 and 1999 will be obligated. 
Additional information which has become available since December now 
indicates that some funds from fiscal years 1998 and 1999 will be 
unobligated.

                         SCHOOL MEALS INITIATIVE
------------------------------------------------------------------------
                                                           Funds carried
                                               Funds         over and
        Fiscal year appropriated           Obligated in    obligated in
                                               year          the next
                                           appropriated     fiscal year
------------------------------------------------------------------------
1998....................................      $7,148,778        $851,222
1999 (est.).............................       8,600,000       1,400,000
------------------------------------------------------------------------

    Question. The fiscal year 2000 budget proposes to restore funding 
of $10 million to the Nutrition, Education, and Training (NET) program. 
The budget also proposes funding $2 million for Nutrition Education and 
Training activities in the Child Nutrition Programs. How will the use 
of this funding differ from the way NET funds are to be used? How would 
this funding be used differently from funding provided for training of 
school food service personnel in the School Breakfast and Lunch 
Programs?
    Answer. The President's budget for the fiscal year 2000 includes 
$10 million in funding for Team Nutrition and $2 million for the 
Nutrition, Education and Training (NET) Program. Team Nutrition is a 
Federally-directed nutrition, promotion and technical assistance effort 
to support the implementation of the School Meals Initiative (SMI) in 
the NSLP and the School Breakfast Program (SBP). Team Nutrition has 
been successful in gaining grassroots support for SMI implementation at 
the local level and has provided many high quality training and 
technical assistance resources. Further, it has focused National 
attention on the need to improve the quality of school breakfasts and 
lunches and provide nutrition education to the Nation's children, which 
will enable them to improve eating behaviors that can influence their 
school performance and health in later years. The Department's $10 
million request for Team Nutrition will allow it to continue this 
Federal-level effort.
    In order for Team Nutrition to be successful, it needs an 
established infrastructure to deliver the ongoing technical assistance 
and training required to support the new nutrition standards and menu 
planning systems established under the SMI. The NET Program is that 
infrastructure as a direct grant-to-States program which is the 
nutrition education and food service training component of the Child 
Nutrition Programs. It offers the vehicle to transport Team Nutrition 
benefits to the 94,000 schools across the Nation in an educationally 
effective and cost efficient manner. The $2 million included in the 
President's budget represents the minimum necessary to maintain this 
infrastructure while we work with Congress to ensure an appropriate 
level of future funding for NET.
    Question. The fiscal year 2000 budget request proposes an increase 
of $2 million to identify and reduce errors in the School Lunch 
Program. What errors exist in the School Lunch Program and how has this 
cost been calculated at $2 million?
    Answer. Errors in the School Lunch Program can be grouped into two 
categories: (1) inaccurate payments that result from the actions of 
households applying for benefits and (2) inaccurate payments that 
result from errors made by administering schools and school districts.
    Category one includes such things as households inaccurately 
reporting income on applications for free or reduced price meals and 
becoming approved for free or reduced price meals, but not notifying 
schools during the school year when household income rises above the 
eligibility threshold for free or reduced price meals. Category two 
includes such things as schools (a) incorrectly approving children for 
free or reduced price meals; (b) incorrectly recording the payment 
status (free, reduced price, or paid) of students on documents (i.e., 
rosters) used to distribute free and reduced price benefits (e.g., meal 
tickets); and (c) making errors in counting meals served and/or in 
reporting meals served to USDA.
    USDA's Income Verification study (1988) found that about 15 percent 
of the households approved for free or reduced price meals were 
ineligible. More recently (1997) USDA's Office of the Inspector General 
(OIG) performed an audit of school districts' verification of free or 
reduced price meal applications in Illinois. The OIG's audit produced 
findings similar to those of USDA's Income Verification study.
    The funds requested would allow us to consider whether changes to 
current application and verification procedures would be cost-
effective. The level of resources requested is based on the cost of 
similar research efforts and represents a modest investment relative to 
the $7.1 billion spent annually (1998 cost) on the School Meals 
Programs.
           community food projects competitive grants program
    Question. The Community Food Projects Competitive Grants Program 
(CFP) was established in 1996 to support projects designed to increase 
food security in communities by meeting the needs of low income people. 
How much funding was provided for this program in fiscal years 1996, 
1997, 1998, 1999, and how much is estimated for fiscal year 2000? How 
many grants were awarded for each of these fiscal years? Do these 
grants allow communities and/or for-profits and non-profits to set up 
gleaning recovery programs?
    Answer. This program is managed by the USDA Cooperative State 
Research, Education and Extension Service. Community Food Projects 
received $1 million in 1996 and $2.5 million each in fiscal years 1997 
and 1998. It is estimated that there will be $2.5 million in both 
fiscal years 1999 and 2000. In fiscal year 1996, 13 grants were 
awarded. In fiscal year 1997 and 1998, 18 grants were awarded each 
year. The fiscal year 1999 Request for Proposals for the program closes 
on June 4, 1999; accordingly, 1999 grants have not yet been awarded.
    Under the authorizing statute for the program, only non-profit 
organizations may receive funds; therefore for-profit entities and 
local government agencies are not directly eligible to receive funds.
    A small number of grantees in this program have incorporated some 
gleaning and food recovery activities into their broader community food 
project activities. However, under the authorizing statute for the 
program, projects that are solely focused on food recovery and gleaning 
would generally not rank high in the funding review process because 
they would not meet all the standards for wide-ranging community food 
projects as defined by the law. Consequently, while some number of food 
recovery and gleaning projects have applied for funding under this 
program, we have generally not been able to award them grants. This is 
one reason the Department has requested funding and authorization for a 
new grant program that would specifically make awards to food recovery 
and gleaning projects to help them expand their infrastructure.
                      food program administration
    Question. An increase of $9.3 million is proposed for food program 
administration for fiscal year 2000. Of this amount $2 million will be 
used to identify and reduce errors in the National School Lunch 
Program. Please identify the proposed allocation of the $6 million for 
food stamp program integrity efforts and the $1.3 million for 
additional program and financial integrity initiatives.
    Answer. The $6 million increase for Food Stamp Program integrity 
efforts will be used to maintain store management and the accuracy of 
the Quality Control (QC) System which maintains oversight of Food Stamp 
Program benefits totaling approximately $19 billion annually. In order 
to support State billings and settlement actions, it is important that 
the QC system remain statistically valid and legally defensible. With 
final regulations now in place to bill States under the liability 
provisions of the Mickey Leland Childhood Hunger Relief Act of 1993, 
the Food and Nutrition Service (FNS) contemplates billing approximately 
20 States each year for liabilities totaling about $60 million. It is 
necessary that FNS ensure the integrity of the QC system both to 
control billings and increase State payment accuracy.
    The $1.3 million for additional program and financial integrity 
initiatives will be used to support staff for the oversight of the 
following:
    Review of State Automated System Development activities.--50 
percent or more of State system's life cycles have been exceeded and 
must be replaced; others suffer from Welfare Reform and Year 2000 
initiative impacts. In order to protect the Government's program and 
financial interests, FNS must maintain a determined oversight posture 
for technical review and oversight of Advance Planning Documents (APDs) 
submitted by State agencies.
    State administrative expense.--The Office of the Inspector General 
audit report findings concluded that administrative expense reviews 
conducted by FNS were found to be inadequate, in part, due to FNS' 
limited resources in this area.
    Retail store operations.--Oversight in this area will include 
maintaining the number of undercover investigations; ensuring timely 
and thorough handling of new retailer applications and re-
authorizations; and providing detailed guidance for reviews of State 
and EBT processor accounting, processing and reporting systems, etc.
    Question. How is the agency using the $752,000 increase provided 
for fiscal year 1999 for program and financial integrity advancement?
    Answer. In the Food Stamp Program the funds are being used to 
support ongoing efforts to improve payment accuracy, recipient fraud, 
claims management, and retailer integrity. Payment accuracy efforts 
include increased State technical assistance and monitoring Quality 
Control reinvestment and other State agency corrective action plans. A 
major claims initiative that began in fiscal year 1997 uses special 
reviews to assess the integrity of the recipient claims system in each 
State agency. The reviews focus on timely claim establishment, 
collection and reporting and integrity of the data contained in the 
claims accountability system. All State claims systems are scheduled to 
be in compliance by the end of fiscal year 2001. In the retailer 
integrity area the agency is implementing a new tool that allows us to 
detect fraud by monitoring transactions that occur at stores. We are 
now able, in some instances, to detect fraud and take action to 
eliminate it.
                 government performance and results act
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The agency developed a Strategic Plan which outlines the 
goals it plans to achieve incrementally by fiscal year 2002. The agency 
has also developed the fiscal years 1999 and 2000 Annual Performance 
Plans which supports the Strategic Plan and specifies those annual 
goals and objectives for both years.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The agency has identified strategic and annual performance 
goals and management initiatives the agency plans to achieve for fiscal 
year 2000 and beyond. In support of this effort, each senior manager 
within the agency develops an annual detailed plan of action which 
provides specific activities that will be undertaken to support our 
annual goals. Each senior manager provides a bi-annual report to the 
Administrator which outlines specific accomplishments. The 
Administrator uses this internal management tool as a means to assess 
the agency operations and management performance.
    Question. How is performance information being used to manage the 
agency?
    Answer. The FNS Annual Performance Plan identifies strategic and 
annual performance goals as well as management initiatives the agency 
plans to accomplish. The agency continuously monitors and evaluates its 
progress toward achieving these goals. As a result the information 
serves as one of many variable used by the Agency to determine policy 
and effect program changes. Accordingly, this data is one very 
important underpinning of most management decisions made at FNS.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. We use data such as Food Stamp Program participation, 
school lunch and breakfast meal service data, general economic 
indicators such as unemployment level and income, and demographic data 
such as school enrollment as the basis for our budget projections. 
Therefore, program performance data is the major driver behind all FNS 
budget requests.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. As required in annual performance planning, FNS has 
incorporated a number of program and policy changes into its annual 
performance plan and goals. The final results of our fiscal year 1999 
efforts will be fully reviewed in the fiscal year 1999 Annual 
Performance Report, but by the end of fiscal year 1999, FNS expects to:
  --implement a policy and provide technical assistance to States to 
        restore food stamp eligibility for those legal immigrants 
        authorized under the Agricultural Research, Extension, and 
        Education Reform Act of 1998;
  --begin development of a National Food Stamp Program nutrition 
        education strategy;
  --propose an incentive system to increase claims collection in the 
        Food Stamp Program;
  --increase to 38 the number of States delivering Food Stamp Program 
        benefits through electronic benefits transfer (EBT);
  --complete a demonstration project to explore the cost and 
        feasibility of using scrip in conjunction with EBT to make food 
        stamp purchases at farmer's markets;
  --secure implementation by over 40 States of the WIC National 
        Breastfeeding Campaign;
  --bring 4 new States into the Farmers' Market Nutrition Program;
  --implement regulations to improve State oversight of the Summer Food 
        Service Program;
  --secure participation by 45 State commodity distribution agencies in 
        the FNS Electronic Data Interchange (EDI) system;
  --reduce State paperwork burden in the commodity distribution 
        programs;
  --complete a new customer satisfaction survey of schools receiving 
        commodities through the National School Lunch Program;
  --and distribute to all school food authorities a Step-by-Step Guide 
        to working with small farmers to buy fresh produce.
    With regard to the procedures of plan implementation, FNS is 
currently undertaking a project to integrate all of its current 
planning activities, including the development and execution of 
strategic and annual performance plans, into a single process. The 
resulting unified process will help to ensure that the priorities 
identified in strategic and annual planning are fully reflected in the 
agency's budget and work-planning processes.
    Significantly, the planning integration project is also tasked with 
devising a strategy to communicate the strategic goals and objectives 
to FNS employees and partners on an ongoing basis. This communication 
is a critical step in ensuring that all those involved with Federal 
nutrition assistance understand the agency's key goals and objectives, 
and their roles and responsibilities in reaching them.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The fiscal year 1999 & 2000 Food and Nutrition Service 
(FNS) Annual Performance Plans (APP) identify the strategic and annual 
performance goals, as well as management initiatives the agency plans 
to accomplish the goals. The resources required to achieve these goals 
are provided in the APP at the strategic goal level. FNS uses a matrix 
format to link these resources to the major program activities outlined 
in the Program and Financing schedules.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. FNS's current budget structure is set up by major program 
and account activity. The APP and Strategic Plan structure reflect 
goals that may span more than one program account. However, the basic 
structure is similar. Therefore, the agency does not plan to make any 
changes to the account structure at this time.
    Question. Does the Agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000?
    Answer. There are a number of performance indicators for which 
reliable data will not be available for inclusion in the first Annual 
Performance Report. In particular, while verification of the 
achievement of goals related to the Child Nutrition Programs, the WIC 
Program, and the Food Distribution Programs is based in many instances 
on administrative data, validation of these findings through 
evaluations or other independent mechanisms is often not possible.
    In a number of instances--for example, for performance goals 
dealing with program integrity in the Child and Adult Care Food Program 
(CACFP), and nutrition quality of meals in the Summer Food Service 
Program (SFSP)--FNS had planned to conduct studies that would provide 
strong data to set performance baselines and measure progress in 
reaching performance goals. However, the loss of funding for studies 
and evaluations forced the agency to rely instead on less-rigorous 
methods to evaluate our progress, or to change the goals to ensure that 
they were measurable.
    Question. If so, what steps are planned to improve the reliability 
of these measures?
    Answer. Currently, FNS is working to revise its strategic plan, to 
better reflect its unifying mission and purposes and to make the plan 
more useful as a strategic management tool. As part of this process, 
the agency is reexamining its performance indicators to improve their 
ability to reflect actual performance, including program outcomes. It 
will also seek ways to validate its measures through evaluations or 
other data sources.
    It is important to note that the agency's loss of funding for 
studies and evaluations has significantly hampered its ability to 
develop new analytical and evaluation tools to measure and report 
performance. As noted above, FNS intended to use a portion of this 
funding to set performance baselines and measure progress in reaching 
performance goals. Restoring this funding for studies and evaluations, 
as requested in the President's budget, is a critical step in enabling 
FNS to find new approaches to better measure its performance in 
achieving its strategic goals and objectives.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The Food and Nutrition Service periodically updates its 
budget estimates based on program performance. The next update will 
occur during the Midsession Review this coming July. If the changes are 
major, they will be submitted to Congress and will also be considered 
in future funding requests.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full cost of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully associated to goals?
    Answer. Each goal identified in the Agency's Annual Performance 
Plan has been resource loaded and reflects the fiscal and capital costs 
as well as the human resources required to achieve the goal.
                  food program studies and evaluations
    Question. The Economic Research Service was given the 
responsibility in fiscal year 1998 and again in fiscal year 1999 to 
manage the research program for the nation's food assistance programs. 
Does the Food and Nutrition Service believe it has had adequate 
involvement in the determination of program priorities?
    Answer. The Food and Nutrition Service and the Economic Research 
Service (ERS) have made a good faith effort to create a practical study 
agenda that responds to the operational needs of the Nutrition 
Assistance Programs. This effort helped shape some of ERS' funding 
decisions and resulted in an agreement between the two agencies that 
allows FNS to pursue some of our operational study priorities with ERS 
funding support. However, because the agencies have fundamentally 
different research goals and methods, the agency firmly believes that 
effective program management can best be supported by locating the 
studies and evaluation functions within FNS. This will ensure tat 
important policy issues in FNS programs are addressed in the agenda.
    Effective program management requires a strong study and evaluation 
function that is sensitive and responsive to emerging policy issues and 
the needs of program operators. This is best achieved by maintaining 
such a function within the agency responsible for Federal Nutrition 
Assistance Programs. While both FNS and ERS have important roles to 
play in developing research that supports the FNCS mission, managing 
the right kind of applied studies and evaluations requires the program 
expertise, sensitivity to evolving policy issues, and relationships 
with multiple stakeholders that can only be developed and sustained 
within FNS.
    Question. For fiscal year 1999, the Appropriations Act provided 
that the Economic Research Service transfer $2 million of the funds 
provided for food and nutrition research to the Food and Nutrition 
Service to conduct evaluations and analyses. How does the Food and 
Nutrition Service plan to spend those funds?
    Answer. The plan for using these funds in support of the agency's 
mission is shown below.
       food and nutrition service fiscal year 1999 research plan
    Food Stamp Microsimulation and Related Analyses.--Microsimulation 
is one of the core tools the agency uses to estimate the budgetary and 
distributional consequences of program changes and alternative policies 
under consideration by the Congress and others.
    This project will support: (1) analyses of the effects of proposed 
changes in the Food Stamp Program on the number and characteristics of 
participants and program costs; (2) acquisition of new survey data as 
they become available, updates of the simulation models with the more 
current data, and appropriate documentation; (3) enhancement of 
modeling capabilities to accommodate changes in the Food Stamp Program, 
changes in other cash assistance programs received by food stamp 
participants, and new technologies; and (4) research on the 
characteristics and behavior of food stamp and other low-income 
households to support future model enhancements and improvements.
    Comparison of School Nutrition Dietary Assessment Data.--In 1993 
USDA released the results of the School Nutrition Dietary Assessment 
Study (SNDA I) which, among other analyses, examined the nutrient 
content of the meals provided in the National School Lunch Program 
(NSLP) and School Breakfast Program (SBP). The Recommended Dietary 
Allowances (RDAs) and the Dietary Guidelines for Americans were used as 
standards against which to compare the meals. Following the study, FNS 
significantly revised the nutritional standards that School Food 
Authorities were required to meet. In order to assess the progress that 
has been made from the time of the first study, in 1995 FNS awarded a 
second contract to examine the nutrient content of meals.
    This project will compare the nutrient content of the school meals 
in 1993 and 1998. This comparison may require extensive recalculation 
of the 1993 data. For example, recalculations may be required because 
the actual nutrient values of some foods have changed over time or 
because our ability to measure nutrient values has improved. This 
project would recalculate the nutrient values so that valid comparisons 
can be made.
    Impact of SBP on Learning.--In recent years, a limited number of 
researchers have conducted studies focusing on the relationship between 
student breakfast consumption and academic performance. Unfortunately, 
these studies have had serious methodological and implementation flaws. 
In order to address this unresolved question, the William F. Goodling 
Child Nutrition Reauthorization Act of 1998 authorized FNS to conduct a 
pilot study that would examine the impact of a universal School 
Breakfast Program on student performance in a limited number of 
schools. The pilot study is subject to appropriation, and was not 
funded in fiscal year 1999. The President's fiscal year 2000 budget 
requests the funding needed to field this study. In order to conduct 
the study in a timely manner, FNS will use fiscal year 1999 funding for 
the initial design and development. This project will address numerous 
complex design and implementation issues that must be resolved before 
fielding the pilot. For example, this project would determine the most 
scientifically sound measures of student academic performance, as well 
as the identification of school districts with the necessary 
demographic characteristics to conduct such a study.
    Quick-Turnaround Budget Analyses and Expert Review.--This funding 
will support quick turnaround studies providing tabulations of extant 
data bases and short reports that are needed to support the fiscal year 
2000 budget request, inform development of the fiscal year 2001 budget, 
and respond to related Congressional inquiries. These services are 
available through the WIC General Analytic Projects contract and the 
Child Nutrition Analysis Projects contract. Expert review of draft 
reports, needed to ensure the high quality of study products, will be 
obtained through these contracts or through direct small purchases with 
the reviewer.
    Question. When the food and nutrition research program was 
transferred to the Economic Research Service in fiscal year 1998 only 
the funds for the research were transferred. The Food and Nutrition 
Service retained in its base the funds it devoted to the management of 
this program. It has been two years since the Congress moved the study 
and evaluation funding to the Economic Research Service. One of the 
Food and Nutrition Service's complaints in the past has been that it 
does not have the funds to manage and oversee its programs. Since your 
workload in the area of studies and evaluations has significantly 
changed and the Congress did not reduce the Food and Nutrition 
Service's salaries and expenses accordingly, how have you effectively 
used the staff previously devoted to studies and evaluations to address 
staffing needs in other areas?
    Answer. The staff responsible for studies and evaluations continue 
to have significant responsibilities that are critical to the success 
of the agency mission. These responsibilities include work on assessing 
the impact of potential policy alternatives on program costs and 
participants; development and clearance of regulatory and civil rights 
impact analyses; preparation of proposals for the annual agency budget 
request; responses to Congressional, State and public inquiries; and 
strategic planning.
    In addition, the study and evaluation function has not gone away. 
The agency is now using its in-house talent to gather and analyze 
empirical data to improve program operations. Staff also stay abreast 
of external research on nutrition, welfare and health programs in order 
to assess and communicate their implications for FNS officials. In 
addition, though the ability to procure the services of contract 
research firms has diminished, we continue to manage a significant 
number of contracts funded through previous appropriations. While the 
decrease in funding seriously constrains the comprehensiveness of our 
activity, the study and evaluation staff continue to provide ongoing 
advice to program managers on the impacts of FNS programs as well as on 
how to improve customer service, program integrity, administrative 
efficiency, and measurement of performance results.
                      y2k emergency food response
    Question. According to the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, the Department's Food and Nutrition Service 
(FNS) is the primary agency for the emergency support function to 
identify, secure and arrange for the transportation of food assistance 
to affected areas following a major emergency. Should a food emergency 
situation occur due to Y2K-related problems or panic-induced 
stockpiling, what preparations has FNS made to address this situation?
    Answer. Because there are USDA foods for on-going Nutrition 
Assistance Programs in every State that can be used to feed the general 
public in emergencies, and because our current assessment indicates 
that there should not be any widespread Y2K problems with the food 
supply or distribution network, FNS has not set up a special food 
reserve exclusively for Y2K. However, we continue to work with our 
State partners, food suppliers, and other agencies in USDA to ensure 
that our indicators are correct. In the coming weeks and months, our 
efforts will be focused on developing and preparing contingency plans 
to ensure that there are alternative sources of food available 
throughout our communities in the unlikely event there is a Y2K-based 
interruption in the food supply.
    Question. What level of funding has been set aside by the 
Department and FNS to deal with the potential need to quickly obtain 
and distribute food should such a food emergency occur as a result of 
Y2K?
    Answer. In the unlikely event that there is a food shortage severe 
enough to be considered an emergency as a result of Y2K problems, State 
inventories located in warehouses, schools and charitable institutions 
could be used to provide nutrition assistance. Additionally, a 
Presidential declaration of emergency would invoke the provisions of 
the Robert T. Stafford Disaster Relief and Emergency Assistance Act and 
enable the Secretary to authorize the expenditure of funds available 
under Section 32 of the Act of August 24, 1935. Section 32 funds would 
be used to purchase and deliver any additional food needed to provide 
nutrition assistance.
    Question. What is USDA's total annual expenditure for stocks of 
commodity foods that are used for USDA-sponsored food programs, 
including emergency food assistance?
    Answer. The total expenditure for commodities purchased for use in 
domestic nutrition assistance programs is anticipated to be at or above 
$1,041,000,000 by the end of fiscal year 1999. This includes $658 
million for Child Nutrition Programs, $90 million for The Emergency 
Food Assistance Program, $76 million for CSFP, $53 million for FDPIR, 
and $164 million in surplus removal commodities donated for use in all 
domestic Nutrition Assistance Programs. USDA does not maintain a 
separate inventory of commodities for use in emergency or disaster 
situations. Commodities stored at the Federal, State and local levels 
can be made available for use in these situations. Normally, 
commodities purchased for schools and stored at the State or local 
level are the first commodities used in emergency or disaster 
situations. However, USDA is exploring the possibility of accelerating 
commodity purchases for delivery prior to the end of the calendar year. 
The commodities would be placed in Federal inventory and made available 
for distribution in the event that food shortages occur as a result of 
Y2K problems.
    Question. What types, how much, and where are these commodity foods 
stored.
    Answer. The types of commodities purchased for USDA-sponsored 
Nutrition Assistance Programs includes frozen beef, chicken and pork; 
canned meats and fish; canned and frozen vegetables; canned and frozen 
juices; dry and canned beans; processed and ready-to-eat cereals; flour 
and flour mix; cheeses; pasta products; peanut products; rice; and 
infant products.
    The majority of the commodities purchased are delivered directly 
from the manufacturer to State and local warehouses. However, a minimum 
level of four months inventory is maintained in Federal warehouses in 
Carthage, Missouri and Exeter, California. The commodities stored in 
these warehouses are primarily for use in the FDPIR and the CSFP. 
Federal inventory at the end of fiscal year 1998 was 30.2 million 
pounds valued at $18.2 million dollars. This level of inventory is 
necessary to maintain uninterrupted service to participants in these 
programs. However, inventory levels vary significantly from time to 
time during a year and between years, depending on the availability of 
commodities purchased under agricultural support programs, which cannot 
be predicted with any degree of certainty.
    Commodities stored in Federal warehouses can be made available for 
use in emergency and disaster situations. However, foods purchased for 
schools and stored in State or local warehouses are usually the first 
commodities used in such situations. In addition to the commodities 
purchased on a regular basis for use in domestic Nutrition Assistance 
Programs, $500,000 is available through a direct appropriation to FNS 
for use in purchasing commodities in response to an emergency or 
disaster situation. USDA is exploring the possibility of accelerating 
commodity purchases for delivery prior to the end of the calendar year. 
The commodities would be placed in inventory in Federal warehouses and 
made available for distribution in the event that food shortages occur 
as a result of Y2K problems.
    Supplemental Nutrition Program for Women, Infants, and Children 
(WIC)
    Question. Please provide the WIC participation, food and 
administrative cost rates for each month in fiscal year 1998 and in 
fiscal year 1999 to date.
    Answer. Monthly WIC participation levels, and food and nutrition 
services and administration (NSA) costs for fiscal year 1998 and for 
fiscal year 1999 to date are provided:

----------------------------------------------------------------------------------------------------------------
                                                                                   Food cost per   NSA cost per
              Fiscal year                         Month            Participation      person          person
----------------------------------------------------------------------------------------------------------------
1998..................................  October.................       7,425,255          $31.47          $10.98
                                        November................       7,271,569           31.60            9.39
                                        December................       7,236,854           31.63           12.13
                                        January.................       7,332,302           31.98           14.48
                                        February................       7,315,333           31.55           10.68
                                        March...................       7,394,810           31.46            9.55
                                        April...................       7,418,120           31.69           11.97
                                        May.....................       7,358,478           31.59           12.09
                                        June....................       7,402,206           31.65           10.94
                                        July....................       7,410,399           31.87           12.48
                                        August \1\..............       7,412,586           32.11           10.50
                                        September \1\...........       7,414,565           32.53           18.92
1999..................................  October \1\.............       7,449,781           31.87           11.67
                                        November \1\............       7,340,512           32.24           10.85
                                        December \1\............       7,283,599           32.38           10.96
                                        January \1\.............       7,332,945           32.72           11.44
                                        February................       7,266,734           32.95          12.56
----------------------------------------------------------------------------------------------------------------
\1\ Indicates these amounts are not yet final; obtained from preliminary State reports for months in which
  financial activity is not closed-out (verified and reconciled).

    Question. The budget indicates a $100 million projected carryout in 
each of fiscal years 1999 and 2000. Is the $100 million still the most 
recent projection of the carryout for fiscal year 1999? If not, what is 
the current estimate?
    Answer. The $100 million projected carryout is our most recent 
estimate. Question. What is the projected ``carry forward'' by states 
into each of fiscal years 1999 and 2000?
    Answer. We project that States will spendforward approximately $22 
million into each of fiscal years 1999 and 2000.
    Question. Based on actual monthly costs per participant to date, is 
the fiscal year 1999 average monthly cost per participant still 
projected to be $44.47 for fiscal year 1999, $32.63 for food costs and 
$11.84 for administrative costs?
    Answer. WIC program cost estimates for fiscal year 1999 have not 
changed.
    Question. If not, what are the most recent estimates?
    Answer. WIC program cost estimates for fiscal year 1999 have not 
changed.
    Question. The Secretary has the authority to use up to $10 million 
in unspent funds for infrastructure, special project grants, and 
breastfeeding promotion and support activities. Please indicate how 
these funds were spent in each of fiscal years 1997 and 1998 and in 
fiscal year 1999 to date.
    Answer. The amounts spent by category for each of the requested 
fiscal years follows:
    In fiscal year 1997, approximately $10 million was allocated for 
these purposes as follows:

Infrastructure Grants to State Agencies.......................$7,201,444
Special Project Grant to State Agencies....................... 1,999,995
Breastfeeding Promotion and Support & Infrastructure Projects.   798,556
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 9,999,995

    The Department allocated a total of $7.2 million to WIC State 
agencies for State-specific infrastructure grants to help support the 
overall goal of reaching more participants and providing quality 
program service. Grants were awarded to 35 State agencies on a 
competitive basis. The following table summarizes the breakout of the 
categories of how the funds were expended.

        Categories of Funds Expenditures           Total Funds Allocated
Automated Management Information and Integrated Data Systems..$5,497,578
Electronic Benefit Transfer (EBT) Projects....................   595,218
Service Integration, Coordination & Co-Location...............   166,700
Breastfeeding Promotion and Support...........................   152,888
Management Technologies and Improvement of Access to Services.   120,612
Facility Renovation and Non-ADP Purchase......................   668,448
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 7,201,444

    The Food and Nutrition Service (FNS) awarded $2.0 million to six 
State agencies to support special State projects in fiscal year 1997. 
The special State projects are of National or Regional significance and 
are relevant to current WIC policy issues, designed to produce a 
demonstrable impact and be transferable to other WIC programs. The 
projects also suggest innovative or creative approaches to improving 
the delivery of WIC services.
    The following table summarizes fiscal year 1997 special project 
grants.

------------------------------------------------------------------------
                                                              Amount
           State agency                    Project           allocated
------------------------------------------------------------------------
Illinois..........................  Feeding with Love:          $182,111
                                     The Impact of
                                     Nutrition Education
                                     on the Bottle
                                     Feeding habits of
                                     WIC Preschoolers.
Mississippi.......................  Breastfeeding                399,745
                                     Promotion and
                                     Support.
Montana...........................  Integrated Data for          600,000
                                     Evaluation and
                                     Assessment.
New York..........................  Barriers to                  215,198
                                     Retention among
                                     Infants and
                                     Children in the WIC
                                     Program.
North Carolina....................  A Model for                  508,808
                                     Evaluating and
                                     Monitoring the
                                     Effectiveness of
                                     the WIC Program for
                                     Children.
Virginia..........................  Distance Training on          94,133
                                     Community-Based
                                     Nutrition Education
                                     for WIC
                                     Professionals:
                                     Implementation and
                                     Evaluation.
                                                         ---------------
    Total.........................  ....................       1,999,995
------------------------------------------------------------------------

    The remaining funds, approximately $800,000, were used to support 
breastfeeding promotion and support activities and infrastructure 
projects of National significance, including an Electronic Benefit 
Transfer project. Several publications were developed and produced and 
other breastfeeding promotional efforts have been conducted, as well as 
a training course in pediatric nutrition and a co-location best 
practices handbook.
    In fiscal year 1998, approximately $9.4 million was allocated for 
these purposes as follows:

Infrastructure Grants to State Agencies.......................$4,319,300
Special Project Grant to State Agencies.......................   478,716
Breastfeeding Promotion and Support, EBT & Infrastructure 
    Projects.................................................. 4,587,369
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 9,385,385

    The Department has allocated a total of approximately $4.32 million 
to WIC State agencies for State-specific infrastructure grants to help 
support the overall goal of providing quality program service. Each of 
our 7 Regional offices initially received $525,000 for allocation to 
WIC State agencies and grants were awarded to 26 State agencies on a 
competitive basis. During the grant period, additional funds became 
available that were used to augment existing grant awards. The 
following table summarizes the breakout of the categories of how the 
funds were expended.

                      General Infrastructure Funds

        Categories of Funds Expenditures           Total Funds Allocated
Automated Management Information and Integrated Data Systems..$2,531,803
Electronic Benefit Transfer (EBT) Projects....................   475,735
Breastfeeding Promotion and Support...........................   352,833
Management Technologies and Improvement of Access to Services.   467,158
Facility Renovation and Non-ADP Purchase......................   491,771
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 4,319,300

    The Food and Nutrition Service (FNS) awarded $478,716 to New York 
to support special State projects in fiscal year 1998. As done in past 
years, FNS funds special State projects of National or Regional 
significance that are relevant to current WIC policy issues, designed 
to produce a demonstrable impact and be transferable to other WIC 
programs. The New York project was titled ``Nutrition Education Video 
Series for WIC Farmers Market Nutrition Program''.
    The final $4.59 million of the nearly $9.4 million total is being 
used to support breastfeeding promotion and support activities and 
infrastructure projects of National significance, including Electronic 
Benefit Transfer projects. Several publications were developed and 
produced on breastfeeding promotion and support and other promotional 
efforts have been conducted. Three States, Ohio, New Mexico and 
Wyoming, received EBT funding totaling approximately $4.1 million.
    In fiscal year 1999, the $10 million has been allocated for these 
purposes as follows:

Infrastructure Grants to State Agencies.......................$3,675,000
Special Project Grant to State Agencies....................... 2,000,000
Electronic Benefit Transfer Projects (EBT).................... 3,500,000
Breastfeeding Promotion and Support, EBT & Infrastructure 
    Projects..................................................   825,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................10,000,000

    The Department will award a total of $3,675,000 to WIC State 
agencies for State-specific infrastructure grants to help support the 
overall goal of providing quality program service. Each of our 7 
Regional offices received $525,000 for allocation to WIC State agencies 
and are in the process of awarding these grants on a competitive basis. 
The following table summarizes the breakout of the categories of 
planned expenditures:

        Categories of General Infrastructure Grant Total Funds Allocated
Automated Management Information and Integrated Data Systems..$2,429,496
Service Integration, Coordination, & Co-Location..............   125,000
Management Technologies and Improvement of Access to Services.   418,541
Facility Renovation and Non-ADP Purchases.....................   701,963
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 3,675,000

    The Food and Nutrition Service (FNS) has set aside $2,000,000 to 
support special State projects in fiscal year 1999. As done in past 
years, FNS funds special State projects of National or Regional 
significance that are relevant to current WIC policy issues, designed 
to produce a demonstrable impact and be transferable to other WIC 
programs. The projects also suggest innovative or creative approaches 
to improving the delivery of WIC services.
    The final $4,325,000 is being used to support breastfeeding 
promotion and support activities and infrastructure projects of 
National significance, including Electronic Benefit Transfer projects. 
At this time, we anticipate competitively awarding about $3.5 million 
for State EBT projects. The remaining funds will be used in a variety 
of ways to support breastfeeding activities.
    Question. A number of changes were made in the WIC Program by last 
year's Child Nutrition Program Reauthorization Act (Public Law 105-366) 
Please indicate the impact, if any, this new statute will have on WIC 
Program or participant costs.
    Answer. The Special Supplemental Nutrition Program for Women, 
Infants and Children (WIC) is a discretionary program with funding 
determined by annual appropriations. Thus P.L. 105-366 had no direct 
impact on total program costs. In addition, we do not anticipate any 
change in per-participant cost as a direct result of any of the 
reauthorization provisions and thus the President's fiscal year 2000 
WIC budget request does not reflect any costs or savings which are 
attributable to reauthorization provisions.
    However, the legislation did include numerous non-budgetary 
modifications to the program. These include provisions designed to 
improve the certification process and strengthen vendor management and 
oversight. A summary of the WIC provisions of Public Law 105-366 is 
provided for the record.

   Supplemental Food Programs Division Regulatory Implementation Plan

            [William F. Goodling Reauthorization Act of 1998]

        Statutory Provision                             Program Affected
Sec. 203(a)(1). Requires physical presence, except in 
    certain circumstances...............................             WIC
Sec. 203(a)(2). Requires documentation of income, except 
    in certain circumstances............................             WIC
Sec.203(b). Requires local agencies to provide education 
    or educational materials relating to the effects of 
    drug and alcohol use by pregnant, postpartum, or 
    breastfeeding women on developing children..........             WIC
Sec. 203(c). Allows the Secretary of Agriculture to 
    provide, in bulk quantity, nutrition education 
    materials developed under the WIC Program to CSFP 
    State agencies at no cost to that program...........       WIC, CSFP
Sec. 203(d). Provides State agencies with greater 
    flexibility in the use of funds recovered from 
    vendors and participants............................             WIC
Sec. 203(e). Requires State agencies to implement a 
    system designed to identify participants 
    participating at more than one WIC site.............             WIC
Sec. 203(f). Requires State agencies to identify high 
    risk vendors and conduct compliance buys on such 
    vendors.............................................             WIC
Sec. 203(g). Reauthorizes the WIC Program through 2003..             WIC
Sec. 203(h). Allows State agencies to use food funds to 
    purchase breast pumps...............................             WIC
Sec. 203(i)(1) (2) and (4). Extends nutrition services 
    and administration (NSA) funding authorization and 
    makes a technical amendment.........................             WIC
Sec. 203(i)(3). Reduces from 15 percent to 10 percent 
    the threshold which the Secretary of Agriculture may 
    reduce a State agency's NSA funding if its actual 
    NSA expenditures exceed its per participant NSA 
    grant...............................................             WIC
Sec. 203(i)(5). Allows State agencies that submit a plan 
    to reduce average food package costs per participant 
    and to increase participation above the level 
    estimated for the State agency to convert food funds 
    to NSA, based on the estimated participation 
    increase rather than actual increase................             WIC
Sec. 203(j). Requires State agencies to offer infant 
    formula rebate contracts to the bidder offering the 
    lowest net price, unless the State agency 
    demonstrates to the satisfaction of the Secretary of 
    Agriculture that the weighted average retail price 
    for different brands of formula in the State does 
    not vary by more than 5 percent.....................             WIC
Sec. 203(k). Extends the requirement that the Secretary 
    to use up to $10 million in unspent funds for 
    infrastructure, special project grants and 
    breastfeeding promotion and support activities......             WIC
Sec. 203(l). Requires State agencies to consider, in 
    selecting retail stores, the prices the store 
    charges for WIC items compared to other stores' 
    prices. Also requires State agencies to establish 
    procedures to ensure that selected stores do not 
    subsequently raise prices to levels that would make 
    them in eligible....................................             WIC
Sec. 203(m). Requires the Secretary to establish, in 
    consultation with State agencies, retailers, and 
    other interested parties, a long-range plan for 
    developing and implementing information systems 
    (including electronic benefit transfer (EBT) 
    systems). Also, State agencies are prohibited from 
    requiring retail stores to pay the costs of EBT 
    systems prior to USDA completing a report on the 
    issue...............................................             WIC
Sec. 203(n). Allows State agencies to spend back not 
    more than 1 percent of food funds and not more than 
    1 percent of NSA funds, respectively. Food funds 
    backspent must be used for food benefits; NSA funds 
    backspent can be used for either food or NSA costs. 
    It would also allow a State agency to spend forward 
    NSA funds for NSA purposes, an amount equal to not 
    more than 1 percent of total grant funds. Finally, 
    State agencies would be allowed, with the prior 
    approval of the Secretary, to carryforward NSA funds 
    in an amount not to exceed one-half of 1 percent of 
    total grant funds for the development of a 
    management information system, including an EBT 
    system..............................................             WIC
Sec. 203(o). Allows program income as a match source; 
    allows State agencies who wish to increase the value 
    of benefits to recipients to compete for expansion 
    funds; and eliminates specific State Plan ranking 
    criteria and preferences; Secretary is only required 
    to use objective criteria...........................            FMNP
Sec. 203(p). Requires State agencies to permanently 
    disqualify WIC vendors convicted of trafficking in 
    food instruments or selling firearms, ammunition, 
    explosives, or controlled substances for food 
    instruments. The disqualification would be effective 
    on receipt of the notice of disqualification, and 
    the vendor would not be entitled to compensation for 
    revenues lost as a result of disqualification. A 
    State agency would be permitted to waive the 
    disqualification in certain circumstances...........             WIC
Sec. 203(q). Allows a court to order a person convicted 
    of trafficking in WIC food instruments to forfeit 
    all property, real and personal, used in a 
    transaction or attempted transaction, to commit, or 
    to facilitate the commission of a violation (other 
    than a misdemeanor) of Program laws or regulations..             WIC
Sec. 203(r). Requires the Secretary to conduct a study 
    of the effect of States' cost containment practices 
    in selecting vendors and approved food items on: 
    program participation, access to and availability of 
    prescribed foods, voucher redemption rates and food 
    selections by participants, participants with 
    special diets or specific food allergies, 
    participant use of and satisfaction with prescribed 
    foods, achievement of positive health outcomes, and 
    program costs. A report to Congress is due not later 
    than 3 years after enactment........................             WIC
Sec. 203(s). Requires the General Accounting Office to 
    conduct a study that assess: the cost of delivering 
    WIC services (including the cost of cost containment 
    efforts), the fixed and variable costs incurred by 
    State and local government for delivering WIC 
    services, the quality of WIC services delivered, and 
    costs incurred for personnel, automation, central 
    support, and other activities to deliver services, 
    and whether the costs meet Federal audit standards 
    for allowable costs. A report to Congress is due no 
    later than 3 years after enactment..................             WIC

    Question. Please report on the Department's latest efforts to 
contain WIC Program costs.
    Answer. In fiscal year 1998, infant formula rebates saved the WIC 
Program approximately $1.35 billion, the most lucrative of the 
program's cost containment measures. State agencies also employ a 
variety of other measures to contain food costs. These measures 
include, but are not limited to, limiting the type and package size of 
WIC approved foods; limiting authorized food selections by, for 
example, requiring participants to select lowest cost or store brand 
products; carefully selecting and monitoring vendors; and contracting 
with manufacturers to obtain rebates on WIC foods in addition to infant 
formula.
    In addition, the Department will soon be publishing proposed 
regulations that implement cost containment statutory provisions of the 
WIC Program reauthorization legislation, the William F. Goodling Child 
Nutrition Reauthorization Act of 1998. These provisions include the 
requirement that States consider, in selecting retail stores, the 
prices stores charge for WIC food items compared to the prices charged 
by other stores, and requires States to establish procedures to ensure 
that selected stores do not subsequently raise prices to levels that 
would make them ineligible.
    Question. Eligible overseas military personnel are authorized to 
receive WIC benefits. Do you agree with the National Association of WIC 
Directors that funding for WIC overseas come from armed forces budget?
    Answer. WIC's authorizing law does not authorize WIC services to be 
provided outside of the United States or its territories. While USDA 
supports the provision of benefits to military personnel serving 
overseas, funding for such benefits should come from the Department of 
Defense appropriation.
    Question. Eligible overseas military personnel are authorized to 
receive WIC benefits. Do you agree with the National Association of WIC 
Directors that WIC programs overseas mirror state-side programs to 
ensure that returning eligible military and civilian personnel are 
fully eligible to participate in the WIC programs in transfer 
locations?
    Answer. Both USDA and the Department of Defense agree that there 
should be a continuation of WIC-type services once personnel leave the 
States for overseas assignment. As such, if a WIC-type program were to 
be developed for military personnel serving overseas, such a program 
should be as close as possible to the domestic WIC Program.
    Question. What is the Food and Nutrition Service doing to advance 
Electronic Benefit Transfer (EBT) systems that improve benefit delivery 
and client services for the WIC Program?
    Answer. The Food and Nutrition Service continues to facilitate the 
design, development and implementation of EBT for WIC by providing 
State agencies with special WIC EBT infrastructure development funds 
and technical assistance. Since fiscal year 1994, FNS has provided 
$10,500,000 to State agencies that are preparing to move from paper-
based service delivery systems to EBT. FNS has developed a National 
vision and goals for WIC EBT including the development of EBT systems 
in 7 States by the year 2000. FNS has developed functional guidelines 
for WIC EBT and has been actively involved in developing National 
standards for WIC electronic transaction processing.
    Question. Funding for WIC, Food Stamp, and Child Nutrition program 
studies and evaluations was transferred to the Economic Research 
Service in fiscal year 1998. The explanatory notes indicate that 
$538,145 in WIC funds were spent for studies, evaluations, and 
technical assistance in fiscal year 1998. Was this funding available 
from prior-year appropriations?
    Answer. Of the total $538,145 presented in the explanatory notes, 
$354,293 was from the WIC fiscal year 1998 appropriation and $183,852 
was carryover from the WIC fiscal year 1997 appropriation.
    Question. How was this $538,145 spent?
    Answer. A table providing a detailed listing of the use of this 
$538,145 in WIC funding is provided for the record.

        Item                                                      Amount
Technical Assistance \1\......................................  $399,808
WIC Advisory Council..........................................    30,000
WIC Participant & Program Characteristics 94-96...............    19,675
WIC Modeling and Analytic Project.............................    18,111
WIC Nutrition Education Assessment Study......................    24,393
WIC Infant Feeding on WEB.....................................       357
Printing......................................................    15,096
Electronic Distributing of FNS Reports........................    15,000
Study of Savings in Medicaid or Indigent Care for Newborns 
    from Participation in WIC.................................     4,293
WIC Census/Single Audit Clearinghouse.........................    11,412
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................   538,145

\1\ These funds were used for a wide variety of technical assistance 
projects designed to support State agencies in their efforts to deliver 
a quality program effectively and efficiently. Some of the major items 
include:
--LPrinting of ``After You Deliver'', a publication which was developed 
for State agencies for use in exit counseling for postpartum women who 
will soon be categorically ineligible for WIC benefits. The publication 
reminds participants of important health messages learned during WIC 
participation, including the importance of a healthy diet, the critical 
need for folate for women in reproductive years, the importance of 
immunization of young children, the dangers of alcohol, tobacco and drug 
use, and an encouragement to breastfeed for subsequent births. State 
agencies also were each provided with a reproducible electronic disk of 
the publication for their own printing purposes.
--LReprint, storage and shipping of USDA inventory of Nationally-
developed WIC materials for free distribution upon request from WIC 
State and local agencies, such as USDA's required civil rights poster, 
WIC's Infant Nutrition and Feeding Guide, How WIC Helps, After You 
Deliver, Tickle Your Appetite, Drugs and Alcohol Can Hurt Your Unborn 
Baby and reproducible negatives and electronic printing disks for State 
agencies.
--LMeeting facilities, equipment and expert speakers for two meetings of 
the Risk Identification and Selection Collaborative (RISC) in which 
medical experts research and present technical information on specific 
nutritionally related medical and dietary risks for use in determining 
and modifying WIC nutritional risk criteria to RISC members. RISC is an 
ongoing partnership between FNS and the National Association of WIC 
Directors for continuing study of the state of the art of nutritional 
risk for WIC eligibility purposes.
--LMeeting support funds for conferences promoting and supporting WIC 
goals and objectives such as the Healthy Mothers, Healthy Babies 
Coalition's annual breastfeeding conference and National Association of 
WIC Directors annual conference speaker honorariums; National 
Association of WIC Farmers Market Nutrition Program Directors annual 
conference, including training sessions for new and prospective State 
agencies.
--LA grant to the American Academy of Pediatrics (AAP) to conduct a 
National meeting for State AAP and WIC breastfeeding coordinators.
--LA grant to the Association of State and Territorial Public Health 
Nutritionists to conduct a survey of the public health and community 
nutrition workforce consistent with Government Performance Report Act 
commitments regarding public health professionals' recruitment and 
retention.
--LA grant to Johns Hopkins University for an unsolicited proposal to 
study the influence of males on breastfeeding incidence and duration.
---------------------------------------------------------------------------
                 wic farmers' market nutrition program
    Question. The fiscal year 1999 Appropriations Act makes $10 million 
immediately available for the WIC Farmers' Market Nutrition Program and 
another $5 million available once it is determined that these funds are 
not needed to meet current caseload levels. Has the $5 million 
contingent amount for the program been released and, if so, when was it 
released?
    Answer. On December 8, 1998, we allocated $12,613,879 in base grant 
amounts to currently operating WIC Farmers' Market Nutrition Program 
State agencies, which included $613,879 of the additional $5 million. 
On April 2, 1999, we allocated all but $85,793 of the remainder of the 
$5 million, based on funding requests for new State agencies and 
expansion requests for current State agencies.
    Question. The WIC farmers' Market Program serves WIC participants. 
Why does the administration propose that it be funded under the 
Commodity Assistance Program account rather than the WIC program 
account?
    Answer. While the WIC Farmers' Market Nutrition Program does serve 
WIC recipients, it also serves farmers. WIC recipients not only get the 
advantages of fresh, unprocessed produce, they also have an opportunity 
to be more closely connected to the real source of food, the farmer. 
Farmers, in turn, are able to market the fruits of their labors 
directly to customers. The regular WIC Program and WIC farmers' Market 
program both deserve independent funding sources with the funds for one 
program not being dependent on the adequacy of funds for the other.
    Question. How many WIC participants received benefits through the 
WIC Farmers' Market Program in fiscal year 1998?
    Answer. The number of WIC recipients that received benefits from 
the WIC Farmers' Market Nutrition Program in fiscal year 1998 was 1.325 
million.
                                 ______
                                 
                 Questions Submitted by Senator Dorgan
                           food stamp program
    Question. According to a recent survey conducted by Congressman 
Tony Hall's office of food banks across the country, the number of 
people utilizing food banks has risen dramatically, an average of 22 
percent in the last year. Can you give us some insight as to why you 
think this is occurring?
    Answer. We, too, have heard from food banks and other emergency 
food providers who report strong and rising demand for assistance. The 
specific reason for this demand is not entirely clear. But clearly the 
fact that reported demand for food banks and other emergency food 
programs is rising suggests that a significant number of households are 
not getting adequate food. At the same time we have heard form 
community leaders and advocates around the country that the nutrition 
assistance needs of many are no longer being met by the Food Stamp 
Program due to policy and procedural changes.
    We have observed that food stamp participation has fallen by 9.7 
million persons between March 1994, the peak, and February 1999, the 
latest month for which information is available. This drop can be 
explained partly by a strong economy and the strength of welfare reform 
and new restrictions on the participation of certain legal immigrants 
and able-bodied unemployed adults without dependent children.
    But other factors may be at work. Between 1995 and 1997 food stamp 
participation fell five times faster than poverty, suggesting that many 
poor families have left the Food Stamp Program despite continued 
eligibility. Some of these families might not be aware of their 
eligibility; others may have been discouraged or even prevented from 
participating in food stamps by State or local agencies. It would not 
be surprising to find that many of these former program participants 
would need to turn as a result to the emergency food network as an 
alternative source of assistance.
    Question. Conversely, the Congressional Research Service reports 
that the number of people using the Food Stamp Program has fallen 
dramatically in the last couple of years. Can you give me any insight 
into the reasons for this dramatic decline?
    Answer. Food stamp participation has fallen dramatically, by 9.7 
million persons between March 1994, the peak, and February 1999, the 
latest month for which information is available. Part of this drop can 
be explained by the strength of the economy and the success of welfare 
reform, which helped move many families from welfare to work. Part of 
the drop is due to new restrictions on the participation of legal 
immigrants and able-bodied unemployed adults without dependent 
children.
    But other factors may also be at work. Between 1995 and 1997, food 
stamp participation fell five times as fast as poverty, a sign that the 
nutritional needs of some low-income people may be going unmet. The 
number of people in poverty fell by 850,000 over this period while the 
number of food stamp participants fell by 4.4 million, suggesting that 
many poor families have left the program despite their continuing 
eligibility. Some families who leave welfare for work may not be aware 
that they still may be eligible for food stamps; in other instances, 
State or local agencies may have discouraged or prevented those 
eligible for benefits from applying. In either case, this should not 
happen.
    Question. Can you explain why it appears that the Food Stamp 
Program's role is declining so dramatically, yet food banks are 
reporting a sharp increase in the number of people utilizing their 
services?
    Answer. There is, as yet, no unequivocal explanation for this 
pattern. We have, however, heard from community leaders and advocates 
around the country who are concerned that the nutrition assistance 
needs of many are no longer being met by the Food Stamp Program, due to 
policy and procedural changes.
    While some food stamp recipients have left the program because the 
strength of the economy and the success of welfare reform has improved 
their economic situation, others have left for reasons that have little 
to do with their need for nutrition assistance. Some are no longer 
eligible for food stamps because they are an immigrant or an 
unemployed, childless adult. Some may not be aware of their eligibility 
for food stamps. And others may have been discouraged from 
participating in the Food Stamp Program by administrative or procedural 
barriers. As a result, it would not be surprising to find that many of 
these former program participants would need to turn to the emergency 
food network as an alternative source of assistance.
    Question. Please detail the impact on current participants in the 
Food Stamp Program of the proposed fiscal year 1999 Supplemental 
Appropriations Bill reduction of $521 million. How will this reduction 
affect the FNCS's ability to assist current participants in the 
program?
    Answer. The proposed reduction of $521 million in the fiscal year 
1999 Supplemental Appropriations Bill will have no impact on current 
participants in the Food Stamp Program. Of the Food Stamp Program funds 
available in fiscal year 1999, at least $1.45 billion will lapse due to 
lower-than-expected participation during this fiscal year. Therefore, a 
reduction of $521 million, as proposed in the fiscal year 1999 
Supplemental Appropriations Bill, will not affect the Food, Nutrition 
and Consumer Service's ability to assist current Food Stamp Program 
participants.
    Question. Please provide the amount of funds requested to restore 
benefits to elderly legal aliens.
    Answer. The Agriculture Research, Extension, and Education Reform 
Act restored food stamp benefits eligibility to any individual who was 
residing in the United States on August 22, 1996 and was 65 years of 
age, as well as other groups of legal immigrants. We estimated at the 
time the bill was passed that it would cost $50 million in fiscal year 
1999 to restore benefits to the elderly portion of this population.
    Question. How many elderly legal aliens have been added to receive 
food stamp benefits?
    Answer. It is too early to measure exactly how many elderly legal 
immigrants were added to the Food Stamp Program as a result of The 
Agriculture Research, Extension, and Education Reform Act. The latest 
data we have now on the citizenship status of food stamp participants 
is the Food Stamp Quality Control data for fiscal year 1997. The 
restoration of benefits did not begin until November 1998.
    At the time the bill was passed, we estimated that 65,000 elderly 
legal immigrants would have food stamp eligibility restored in fiscal 
year 1999.
    Question. Is this the biggest group being ``inadvertently'' denied 
benefits?
    Answer. No. There are two large groups of legal immigrants who have 
not had their Food Stamp Program eligibility restored by the 
Agricultural Research bill. These two groups include:
  --parents of U.S. born children (who have always been eligible for 
        benefits) and parents of legal immigrant children (who had 
        their eligibility restored under the Agricultural Research, 
        Extension, and Education Reform Act of 1998) who were in the 
        United States before the enactment of welfare reform; and
  --new immigrants who arrived in the country after the enactment of 
        welfare reform. These include elderly, disabled, children, 
        their parents, and other smaller subgroups. However, given 
        economic constraints, we believe that resources should be 
        targeted to the group of elderly immigrants helped by our 
        proposal who are particularly vulnerable and in need of 
        assistance.
                        child nutrition program
    Question. Under Secretary Watkins testimony stated that the Child 
Nutrition Reauthorization Act of 1998, allows USDA to ``pilot test'' a 
school breakfast project at no cost to participating students in 
selected elementary schools. During the pilot test USDA will evaluate 
the effect of eating school breakfast on children's behavior and 
education performance. Given that the appropriation language for fiscal 
year 1999 does not fund the pilot test and, it is our understanding 
that ERS has the funds to conduct evaluations, can FNCS move funds from 
another account, such as the Food Program Administration account, to 
fund the pilot test?
    Answer. The William F. Goodling Child Nutrition Reauthorization Act 
of 1998 (Public Law 105-336) authorizes funding for demonstration 
school breakfast projects, which are to include a rigorous evaluation. 
No funds were provided for the demonstrations in fiscal year 1999. We 
have estimated that the demonstrations would cost approximately $13 
million over three years--$10 million for evaluation costs and $3 
million to fund added meal costs in the demonstration sites. These 
funds are requested in the President's fiscal year 2000 budget.
    The $12 million funding for studies and evaluations of the 
Nutrition Assistance Programs that appears in the 1999 budget of the 
Economic Research Service (ERS) is not adequate to conduct the school 
breakfast demonstrations. This funding is needed to address other 
priority issues. For example, Public Law 105-336, authorized a study of 
cost containment practices in the Special Supplemental Nutrition 
Program for Women, Infants and Children (WIC), and fiscal year 1999 
appropriations report language specifically expressed the Congressional 
expectation that this WIC study be conducted. The $2 million portion of 
the funding allocated to the Food and Nutrition Service is largely used 
to support microsimulation modeling needed for developing Food Stamp 
Program legislative and budget impact estimates.
    For fiscal year 1999, appropriations language prohibits the Food 
and Nutrition Service (FNS) from using funds from the Food Stamp, Child 
Nutrition, or WIC program accounts for research or evaluation. FNS has 
determined that there is no prohibition on use of Food Program 
Administration (FPA) funds for research activities, as research and 
analysis is a legitimate and necessary activity for proper program 
management. Thus FNS would not legally be prohibited from funding the 
$13 million for demonstrations using the FPA account.
    However, given the amount of funds needed, funding the 
demonstrations through FPA is not possible. FNS' current FPA resources 
are fully committed to staff and other program management needs. 
Diversion of these resources to fund the demonstrations would leave FNS 
unable to meet its most fundamental program management 
responsibilities. Diminishing resources cannot keep pace with changing 
program needs and the implementation of new legislation. Welfare 
Reform, Government Performance and Results Act (GPRA), the Chief 
Financial Officer (CFO) Act, the Healthy Meals for Healthy Americans 
Act, to name a few, have imposed significant, new, and ongoing 
administrative burdens on already strained staff years and funds. FNS' 
programs have expanded in size and complexity and the agency has been 
called to improve the nutrition of program recipients, strengthen 
program integrity and implement Electronic Benefits Transfer (EBT) 
Nationwide. FNS employees are so overburdened that they are forced to 
discontinue important work and react as crises arise, rather than look 
ahead and plan for the future.
    Recent Office of the Inspector General (OIG) and General 
Administration Office (GAO) audits reflect insufficient staff assigned 
to ensure compliance with statutory requirements in areas such as 
retailer integrity and food stamp fraud, the agency's financial 
statements, documentation and collection of food stamp recipient 
claims, frequency of management evaluations required by program 
regulations, oversight of the Child and Adult Care Food Program 
(CACFP), oversight of advanced planning documents, and State cost 
allocation and claiming.
    FNS' insufficient staffing level is a result of administrative 
funding reductions which have required an 18 percent cut in staff since 
1993. Additionally, the agency has cut all non-labor expenses, such as 
travel and training, by more than five percent each year since 1994. 
Accordingly, FNS is in no position to target FPA funds for this 
demonstration.
                nutrition education and training program
    Question. I am concerned that Congress eliminated funding in fiscal 
year 1999 for the Nutrition Education and Training Program (NET). This 
is a small program but it has a big impact in North Dakota and other 
states. There is a lot of confusion in Congress about the NET Program 
and the Team Nutrition Programs. For the record, please provide a 
clarification of the programs.
    Answer. The Department recognizes that there is confusion about the 
respective roles of Nutrition Education and Training (NET) and Team 
Nutrition. There is an unfortunate misperception that they are 
overlapping programs that do much the same thing. In fact, however, the 
two programs are complementary. Team Nutrition develops education and 
technical assistance materials designed to address issues of National 
concern to a wide range of audiences, including food service 
professionals, community organizations, families and, most important of 
all, children. Team Nutrition also provides Federal assistance for 
States' training efforts through Team Nutrition grants. However, NET 
provides a vital counterpart to these Federal efforts at the State 
level. Through NET, State Child Nutrition agencies are able to provide 
materials and assistance that are tailored specifically to the needs of 
their States. Moreover, by making grants available to local operators, 
NET is able to support creative initiatives at the local level for a 
very modest investment. Finally, NET provides the ongoing training and 
technical assistance necessary for the efficient operation of the Child 
Nutrition Programs, and the NET infrastructure is used by many States 
to carry out training and technical assistance projects funded through 
Team Nutrition Grants. For all of these reasons, NET and Team Nutrition 
are not competitors, but partners.
                      nutrition assistance program
    Question. FNCS has formed strategic partnerships to promote better 
nutrition and healthy eating habits among participants in the nutrition 
assistance programs. Please provide details on FNCS's strategic 
partnerships and the latest efforts to promote better nutrition and 
program participation.
    Answer. Both FNS and the Center for Nutrition Policy and Promotion 
(CNPP) have formed strategic partnerships with a wide range of 
government agencies to promote better nutrition and healthy eating 
habits among participants in Federal Nutrition Assistance Programs, and 
among the population at large. A list of key strategic partnerships is 
provided below.
    In addition, FNS and CNPP collaborate on an ongoing basis with the 
Department of Health and Human Services (DHHS) to coordinate policies 
and programs, including such agencies as the Centers for Disease 
Control and Prevention (CDC), the National Center for Health Statistics 
(NCHS), the Office of Disease Prevention and Health Promotion (ODPHP), 
the Health Resources and Services Administration (HRSA) (including the 
Maternal and Child Health Bureau), the Administration on Aging (AOA), 
the Indian Health Service (IHS), and others.
    FNS and CNPP also participate in many National efforts to 
communicate sound eating and health behaviors, such as the National 
Dietary Alliance, the National Healthy Mothers, Healthy Babies 
Coalition, Bright Futures, the Healthy People 2010 National Health 
Objectives working groups, and many others.
Partnerships with FNS and CNPP Involvement
    USDA Dietary Guidance Working Group.--CNPP chairs this group, and 
FNS and CNPP serve as partner agencies. The Working Group promotes 
consistency in USDA dietary guidance across USDA agencies and DHHS 
agencies, and ensures that dietary guidance accurately reflects the 
USDA/DHHS Dietary Guidelines, is supported by research-based knowledge, 
and is objective in its presentation.
    USDA Human Nutrition Coordinating Committee.--CNPP co-chairs this 
committee with the Agricultural Research Service (ARS), and FNS 
participates as a partner agency. It is designed to: 1) ensure 
communication among agencies involved in human nutrition within the 
Department, and 2) explore and recommend positions on human nutrition-
related policy issues.
    Thrifty Food Plan Working Group.--CNPP has convened this group, 
with FNS as one of the partner agencies, to obtain input and support 
from Federal partners in maintaining and updating the Thrifty Food 
Plan.
    Joint USDA/DHHS Nutrition Education Committee for Maternal and 
Child Nutrition Publications.--FNS and CNPP both participate in this 
committee, which provides a systematic mechanism for USDA and DHHS 
agencies to report plans and progress related to maternal and child 
nutrition education, to avoid duplication and facilitate coordination, 
and to make more effective use of resources. The materials developed 
and shared through this committee benefit FNS Nutrition Assistance 
Program participants.
    Federal Steering Committee for the Dietary Reference Intakes.--CNPP 
and FNS are members. The Committee interfaces with representatives of 
the Institute of Medicine's Food and Nutrition Board regarding work to 
be done to update the 1989 RDA's to the new Dietary Reference Intakes. 
Work is funded by various Federal agencies and by Health Canada, who 
are represented on the steering committee.
    Nutrition and Food Safety Education Task Force.--FNS and CNPP are 
both involved in this interagency task force, which serves as a forum 
for the exchange of materials and ideas on nutrition education and food 
safety--materials and ideas that are used to benefit FNS Nutrition 
Assistance Program participants.
    Diet Appraisal Research Group.--CNPP chairs this group. Its purpose 
is to communicate and share results of diet appraisal research being 
conducted by the Federal government.
Partnerships with FNS Involvement
    Team Nutrition.--FNS has partnered with an extensive network of 
organizations at the National, State, and community levels to develop 
and implement the diverse range of Team Nutrition projects, programs 
and activities throughout the country.
    Nutrition Support Networks.--These networks, supported through a 
combination of State, private, and Federal matching funds, bring 
together strategic partners at the State level to deliver nutrition 
education and promotion to Food Stamp Program recipients. The networks 
emphasize the Dietary Guidelines, and rely on integrated community-
based efforts, State flexibility, and use of innovative social 
marketing approaches to nutrition promotion.
    American Academy of Pediatrics, Committee on Nutrition.--FNS 
maintains an active liaison relationship with the Academy concerning 
all aspects of nutrition related to infants, children, and adolescents. 
FNS acquires data which will form the scientific basis for nutrition 
policy and nutrition promotion projects designed for FNS Nutrition 
Assistance Program participants.
    Interagency Committee on School Health (ICSH).--FNS is a partner in 
this committee which is sponsored jointly by the U.S. Department of 
Agriculture, U.S. Department of Education, and U.S. Department of 
Health and Human Services. The purpose of the ICSH is to increase the 
overall effectiveness of Federal efforts to provide leadership to 
improve the education and health of school-aged children and youth 
through promotion and implementation of school health programs. It is 
concerned with all Federal policies and programs, and other activities, 
related to the promotion and implementation of school health 
programming in elementary and secondary schools.
    Bright Futures in Practice.--Nutrition Committee: FNS is a partner 
in this committee, which has developed a Nutrition Implementation guide 
to complement the Bright Futures publication on health care supervision 
of infants, children, and adolescents.
    Welfare Reform, Nutrition, and Data Needs Working Group.--FNS and 
the National Center for Health Statistics co-chair this working group 
of the Interagency Board on Nutrition Monitoring and Related Research. 
The group holds quarterly meetings to focus on whether existing and 
planned data collections will be adequate to assess nutritional status 
under welfare reform. The meetings involve representatives from the 
major Federal agencies and many private groups active in anti-hunger, 
nutrition and welfare matters.
    Girl Power and You Initiative.--FNS is a partner in this 
initiative, which addresses the special information needs of adolescent 
African-American girls regarding nutrition, physical activity and urban 
growth.
    Physical Activity Initiative Advisory Committee.--FNS is a partner 
in this committee, which is developing physical activity initiatives 
for children and adolescents.
    Head Start Bureau Nutrition Education Liaison.--FNS provides 
consultation in the area of the nutrition component of the Head Start 
Program and serve on related ad hoc or continuing committees, as 
convened.
    Breastfeeding Promotion Consortium.--FNS created this active 
consortium to facilitate communication and coordination among 
organizations interested in breastfeeding promotion.
    National Healthy Mothers/Healthy Babies Coalition's Breastfeeding 
Promotion Committee.--FNS is a partner in this committee which promotes 
public education efforts in maternal and child health through 
collaborative activities and the sharing of information among 
professional, voluntary, and government organizations. Through this 
alliance, FNS actively promotes public education efforts related to 
breastfeeding, which improves the health and nutrition status of 
infants and children participating in FNS programs.
    Surgeon General's Advisory Committee on Infant Mortality.--FNS is a 
partner in this committee, which provides guidance and focuses 
attention on the policies and resources required to address the 
reduction of infant mortality, including improved nutrition of FNS' 
target audience of low income nutrition assistance program 
participants.
    Oral Health Promotion Efforts.--FNS is a partner in the Surgeon 
General's Federal Coordinating Committee Report on Oral Health and in 
the Planning Committee on the Surgeon General's Conference and Workshop 
on Oral Health. In these roles, FNS supports and assists in the 
development of the Surgeon General's Report on Oral Health and related 
activities and contributing a perspective on oral health as related to 
FNS food assistance program participants. FNS is also partnering with 
the DHHS Oral Health Initiative team in an effort to promote oral and 
dental health among our similar target audiences.
Partnerships with CNPP Involvement
    Dietary Guidelines Advisory Committee.--CNPP is Co-Executive 
Secretary with ARS and HHS. The committee reviews and revises the 1995 
Dietary Guidelines. This activity is authorized under the National 
Nutrition Monitoring and Related Research Act of 1990, which directs 
the Secretaries of USDA and HHS to issue jointly at least every five 
years a report entitled Dietary Guidelines for Americans. CNPP will 
take the lead in developing the consumer publication for the Guidelines 
to be issued in 2000.
    Dietary Guidelines Alliance.--CNPP is a liaison member. The 
Alliance was formed by the American Dietetic Association, Federal 
government agencies, and private-sector food commodity, trade and 
consumer interest organizations to develop positive, simple, and 
consistent messages to help consumers achieve healthy, active 
lifestyles.
            school lunch program--country-of-origin labeling
    Question. There is a lingering perception that food products from 
some countries might pose greater risks than those from others. For 
example, a March 1997 outbreak of hepatitis A among Michigan 
schoolchildren was linked to frozen strawberries purchased for the 
school lunch program that were grown in Mexico. Please describe the 
measures FNCS has taken to restrict imported foods from the School 
Lunch Program.
    Answer. As you know, a ``Buy American'' provision has applied to 
schools for many years. The recent reauthorization legislation for the 
Child Nutrition Programs codified the provision in that authorizing 
statute by requiring schools participating in the school lunch and 
breakfast programs to purchase, to the extent practicable, 
unmanufactured food products grown or produced in the United States and 
food products manufactured in the United States substantially from 
agricultural products grown or produced in the United States. The 
Department has advised schools of this new legislation and is including 
this provision in a final regulation that should begin formal clearance 
procedures shortly.
    It must also be emphasized that the commodities which the 
Department acquires and donates to schools as part of the assistance 
provided under the school lunch program must be produced domestically. 
This is because the Department acquires them to help stabilize the 
agricultural economy. In the wake of the strawberry situation to which 
you refer, the Department has intensified its procedures for ensuring 
the integrity of foods acquired for distribution to schools and other 
institutions.
    Question. There is a lingering perception that food products from 
some countries might pose greater risks than those from others. For 
example, a March 1997 outbreak of hepatitis A among Michigan 
schoolchildren was linked to frozen strawberries purchased for the 
school lunch program that were grown in Mexico. How does FNCS handle 
foods purchased with non-federal dollars?
    Answer. As you know, Federal reimbursement for school meals 
represents only part of the total funds in the school food service 
account. Other monies come from State reimbursement, meal charges paid 
by children who do not qualify for free meals and revenues generated by 
the sale of competitive foods. These non-federal funds are not subject 
to the ``Buy American'' provision of the law. However, other 
restrictions on the use of the food service account do apply. These 
restrictions are intended to ensure that the food service account is 
used to provide nutrition benefits to children.
                    program and financial integrity
    Question. The FNCS must ensure both the program and financial 
integrity of each program and the timely delivery of benefits to all 
qualified recipients.
    Please provide a detailed list of program integrity studies.
    Answer. A list of all 53 program integrity studies conducted by the 
agency in recent years is attached.
                  food stamp program integrity studies
FSP General General
    Study of State Law Enforcement Agreements.--by Leo Allman, Systems 
Planning Associates, and Christopher Logan, Abt Associates, September 
1996.
FSP Quality Control
    Evaluating the Hunger Prevention Act Quality Control Reforms: A 
Report to Congress.--by Gregory Mills, Nancy Burstein, Margaret Hart, 
David Hoaglin, and Dorothy Rosenbaum, Abt Associates, September 1991.
    Reforming the Negative Action Quality Control System: A Report to 
Congress by Jenny Genser and Steven Carlson, Office of Analysis and 
Evaluation, July 1990.
    Redesign of the Negative Action Quality Control System in the Food 
Stamp Program: Final Report by Gregory Mills and David Hoaglin, Abt 
Associates, June 1990.
    Treatment of Incomplete and Out-of-Scope Case Reviews in Food Stamp 
Quality Control by Morris Hansen and Benjamin Tepping, Westat, June 
1989.
    Stratification and Estimation in Food Stamp Quality Control by 
Morris Hansen and Benjamin Tepping, Westat, June 1989.
    Evaluation of the Federal One-Tier Quality Control Pilot Project by 
Lee Bawden, Pamela Holcomb, Neal Jeffries, Wayne Vroman, and Douglas 
Wissoker, The Urban Institute, May 1989.
    Redesign of the Negative Action Quality Control System in the Food 
Stamp Program: Feasibility Report by Gregory Mills, Mary Beth Sullivan, 
and David Hoaglin, Abt Associates, January 1989.
FSP Error Reduction
    Evaluation of Grants to States for the Reduction of Payment Error 
in the Food Stamp Program by Cynthia Holmes, Mary Kay Sistik, and 
Robert Cook, KRA Corporation, September 1996.
    Process Analysis as a Means to Error Reduction in the Food Stamp 
Program: Final Report and Project Summary by MAXIMUS, Inc., February 
1993.
    User's Guide: Contingency Model for Food Stamp Program Error 
Reduction by MAXIMUS, Inc., February 1993.
    Error Reduction in the Food Stamp Program: Assessment of the Error 
Controls Profile and the Contingency Model by Linda Maxfield, Cindy 
Brach, Dean Conley, Kyle Conley, Deborah Chassman, and Ann Toch, 
MAXIMUS, Inc., February 1993.
    The Relationship Between Overpayments and Underpayments in the Food 
Stamp Program: Updated Analysis by Gregory Mills, Abt Associates, 
August 1991.
    The Effect of Caseload Characteristics and Socioeconomic Conditions 
on Food Stamp Payment Error Rates: State Level Analysis by Michael 
Puma, Abt Associates, February 1989.
    Reducing Food Stamp Overpayments: More Frequent Recertifications 
and Monthly Reporting by Gregory Mills, Abt Associates, December 1988.
    The Relationship Between Overpayments and Underpayments in the Food 
Stamp Program by Gregory Mills, Abt Associates, September 1988.
    State-Initiated FNP Demonstration Project Assistance and Evaluation 
by Applied Management Sciences, August 1988 (3 volumes).
    State Administrator's Quality Control Demonstration and Evaluation 
Handbook by Applied Management Sciences, August 1988.
                            fsp trafficking
    Synthesis Report for the Food Stamp Participant Trafficking Study 
by Anne Ciemnecki, Lara Hulsey, James Ohls, Irving Piliavin, Mercer 
Sullivan, and Josh Rossol, Mathematica Policy Research, July 1998
    The Extent of Trafficking in the Food Stamp Program by Theodore 
Macaluso, Office of Analysis and Evaluation, August 1995.
    Food Stamp Program Integrity Methodological Feasibility Study by 
James Lubalin and Jenny Schnaier, Research Triangle Institute, March 
1991.
FSP Verification and Matching
    The Cost-Effectiveness of the Income and Eligibility Verification 
System in Arizona and Michigan by Nancy Fasciano and Sheena McConnell, 
Mathematica Policy Research, April 1995 (two volumes).
    The Income and Eligibility Verification System Targeting 
Demonstrations: Findings and Guidelines for State Food Stamp IEVS 
Programs by Myles Maxfield and Susan Allin, Mathematica Policy 
Research, April 1995.
    State Census of Income and Eligibility Verification System (IEVS) 
Procedures by Susan Allin, Mathematica Policy Research, March 1992.
    Computer Matching: A Review of Exemplary State Practices by David 
Greenburg and Regina Yudd, The Urban Institute, November 1990.
    State and Local Computer Matching Operations by Demetra Nightingale 
and Regina Yudd, The Urban Institute, November 1990.
    Costs and Benefits of the National Disqualification Reporting 
Network by Mark Menne and William Hamilton, Abt Associates, November 
1989.
    Preventing Fraud and Abuse in the Food Stamp Program: The Use of 
Computer Assisted Verification of Applicant-Reported Information by 
Michael Puma, Abt Associates, January 1989.
FSP Claims Collection Claims Collection
    Optimal Thresholds in the Collection of Food Stamp Program Claims 
by Myles Maxfield, Mathematica Policy Research, December 1995.
    Claims Collection Tracking and Aging Systems by Linda Wray, 
Mathematica Policy Research, November 1990.
    State and Local Claims Collection Operations by Sharon Long and 
Linda Wray, Mathematica Policy Research, (undated).
FSP Retailer Operations
    Retailer Pre-Authorization Visit Demonstration: Final Summary 
Report by Christopher Logan, Julie Masker, John Blomquist, Abt 
Associates, March 1998.
    Food Stamp Program Guidebook for FCS Store Visit Contractors by Abt 
Associates, September 1997.
    Evaluation of Food Retailer Compliance Management Demonstrations in 
EBT-Ready States and Related Initiatives by Christopher Logan and Paul 
Elwood, Abt Associates, April 1997.
    Food Stamp Coupon and WIC Voucher Management Practices and Program 
Educational Needs of Food Stamp Retailers by Richard Mantovani, Johnnie 
Daniel, Harry Liu, and Katy Hoffman, Macro International, December 
1995.
Child Nutrition Programs Integrity Studies
    Early Childhood and Child Care Study: Nutritional Assessment of the 
CACFP: Final Report Volume II, Abt Associates, Inc. July 1997
    Private Nonprofit Sponsors in the Summer Food Service Program, 
Mathematica Policy Research, Inc., January 1994
    National Study of the Adult Component of the Child and Adult Care 
Food Program (CACFP) Final Report--Volume I: Results, Volume II: 
Technical Appendices and Tables, Mathematica Policy Research, Inc. (not 
released until 3/94), October 1993
    The School Nutrition Dietary Assessment Study: School Food Service, 
Meals Offered, and Dietary Intakes, Mathematica Policy Research, Inc., 
October 1993
    Child Nutrition Program Operations Study--Second Year Report, Abt 
Associates Inc., June 1992
    Review Systems for the National School Lunch Program, Office of 
Analysis and Evaluation, Food and Nutrition Service, March 1992
    Child Nutrition Program Operations Study--First Year Report, Abt 
Associates Inc., August 1991
    Study of Income Verification in the National School Lunch Program, 
Abt Associates Inc., February 1990
    Federal Review Final Report, Office of Analysis and Evaluation, 
Food and Nutrition Service, February 1990
    Study of the Child Care Food Program (CCFP), Abt Associates Inc., 
August 1988
    An Evaluation of the Summer Food Service Program, Mathematica 
Policy Research, Inc., July 1988
                     wic program integrity studies
    Estimating the Number of People Eligible for WIC and the Full-
funding Participation Rate: A Review of the Issues Mathematica Policy 
Research February 1999
    Income Variability Among Families with Pregnant Women, Infants and 
Young Children, Mathematica Policy Research, January 1997
    WIC Nutrition Risk Criteria: A Scientific Assessment, National 
Academy of Sciences, May 1996
    WIC Vendor Issues Study 1991, Final Report, Aspen Systems 
Corporation, Applied Management Sciences Division; Food and Nutrition 
Service; Survey Design, Inc., May 1993
    WIC Vendor Issues Study 1991, Chartbook, Aspen Systems Corporation, 
Applied Management Sciences Division; and the Food and Nutrition 
Service, May 1993 WIC Income Verification Study: Final Report QPC 
Corporation December 1990
    WIC Vendor Management Systems and Practices, Professional 
Management Associates and the Office of Analysis and Evaluation, Food 
and Nutrition Service, December 1990
    Question. The FNCS must ensure both the program and financial 
integrity of each program and the timely delivery of benefits to all 
qualified recipients.
    In addition, describe what problems have been found and what 
solutions are being considered.
    Answer. The studies have addressed a wide array of problems and 
solutions. Some selected examples include:
Eligibility Determination
    FNS studies have documented best error reduction practices and made 
the information available to States. FNS studies have addressed 
eligibility verification practices and cost-effective thresholds for 
the collection of financial claims against food stamp recipients.
    FNS research developed the most accurate annual State-level 
estimates of the number of persons in poverty. Annual State-level 
estimates of the number of persons eligible for the WIC Program are a 
critical component of the formula used to allocate WIC funding to 
States. Prior to development of these estimates, FNS had to rely on 
information from the decennial census that was as much as 10 years out-
of-date.
Timely Work Requirements
    FNS studies supported faster implementation of new work 
requirements for able-bodied food stamp recipients. FNS' analyses have 
guided State identification of the target population, waiver decisions 
and disbursements of Employment and Training funds.
Nutritional Integrity
    FNS research determined the nutrients provided to school children 
in school lunches and breakfasts. This information was the foundation 
for the recent, historic changes in the School Nutrition Programs. For 
the first time since the program began in 1946, school meals are now 
required to meet the standards for healthy meals. Data from the School 
Lunch and Breakfast Cost Study provided critical information to conduct 
a cost-benefit analysis of alternative menu planning options used in 
the School Meals Initiative for Healthy Children.
Vendor Management
    FNS studies demonstrated the feasibility of reducing fraud by using 
private-sector firms to visit stores before they get Food Stamp 
authorization. The FNS evaluation identified specific procedures to 
encourage and avoid.
    An FNS study generated the only data-based, National estimate of 
the prevalence of trafficking in the Food Stamp Program. FNS analyzed 
11,000 undercover investigations of food stores to establish a baseline 
estimate of $815 million in trafficking--just under four cents of every 
benefit dollar issued--for fiscal year 1993. An update for the current 
period will be available later this year.
    FNS studies have been used to uphold sanctions imposed upon food 
retailers engaging in fraudulent EBT transactions, as well as to 
develop systems to target store investigations effectively. One study 
resulted in a 45 percent improvement in targeting of investigations 
while freeing 35 staff years per year for more productive uses.
Administrative Efficiency
    FNS studies supplied the foundation to develop and expand 
electronic benefit transfer (EBT). Agency studies proved the financial 
cost-effectiveness of EBT and continue to inform decisions on how to 
use EBT data to fight fraud, extend electronic service to farmers' 
markets, and balance cost with service.
    FNS documented the Federal cost savings associated with 
participation in the WIC Program. FNS demonstrated that $1 dollar 
invested in prenatal WIC participation for very low-income women saves 
an average of $3 in Medicaid costs during the first 60 days after an 
infant's birth. FNS studies provided the ability to determine the 
adequacy of Federal meal subsidies for the National School Lunch and 
School Breakfast Programs. FNS determined that the combined Federal 
subsidy for free lunches and breakfasts covered the average cost of 
producing these meals, suggesting that the current reimbursement rates 
are appropriate.
    FNS research was instrumental in determining the future of the 
Commodity Donation Program. FNS research provided the impetus for 
substantial improvements in the Commodity Donation Program, rather than 
abandoning the program in favor of alternatives such as Commodity 
Letter of Credit or Cash-in-lieu of Commodities. The efficiency of USDA 
purchasing and delivery systems was assessed along with the relative 
importance of USDA commodity donations to schools.
                                 ______
                                 
                  Questions Submitted by Senator Byrd
                 school lunch/school breakfast programs
    Question. Chairman Cochran, Senator Kohl, and members of the 
Subcommittee, I am pleased to be here today to review the U.S. 
Department of Agriculture's (USDA) nutrition assistance programs, and 
the Food and Drug Administration's (FDA) programs.
    The Food and Nutrition Service (FNS) administers the USDA food 
assistance programs. The programs administered by the FNS provide a 
federal safety net to ensure that Americans do not go hungry. While the 
programs under the FNS are all significant, today, I will limit my 
questions to FNS's National School Lunch Program.
    First, I want to note that Ms. Martha C. Hill of Madison, West 
Virginia is serving as the National President of the American School 
Food Service Association, the professional association for persons 
actively engaged in the delivery of food service in schools. I am proud 
that Ms. Hill has earned this distinguished recognition, and I commend 
Ms. Hill for her many years of selfless and honorable dedication to 
betters the lives of countless young people. Ms. Hill and other school 
lunch providers in West Virginia are actively promoting the highest 
standards for school food service and nutrition programs, and she has 
worked to enhance learning and quality of life through nutrition 
programs in West Virginia and the nation. Secretary Watkins, please 
provide me with a report on your agency's impact on the school lunch 
and breakfast program in West Virginia.
    Answer. West Virginia is one of our most progressive States in 
implementing policies and procedures to enhance the nutritional 
benefits of the National School Lunch Program (NSLP) and School 
Breakfast Program (SBP). The foundation for their success is strong 
State policies that complement Federal policy. Their policies have 
resulted in providing healthy school meals and improving student access 
to the programs. For example, all public schools must provide school 
breakfasts, unless they have been granted a waiver. However, they 
recognize that mandating a breakfast program is not enough to increase 
student participation. Adequate time to eat and student friendly 
customer services, such as their ``grab and go'' breakfast option and 
breakfast bars are important. Other factors in improving access to the 
lunch and breakfast programs have been computerized counting and 
claiming systems; a family billing system, which has reduced any social 
stigma associated with the programs; offering a variety of food; and 
using direct certification procedures.
    The State's ``Standards for School Nutrition'' exceed the Federal 
requirements. In general, foods of minimal nutritional value cannot be 
sold or served during the school day and all other foods available must 
meet the Dietary Guidelines. Team Nutrition has significantly 
contributed to the success of promoting nutrition education. A high 
percentage of West Virginia schools have enrolled as Team Nutrition 
schools. Additionally, West Virginia has enhanced the programs' 
effectiveness with Team Nutrition Training grants, industry grants and 
grants from advocacy organizations. In 1998, West Virginia was 
recognized for their outstanding achievements in Child Nutrition by 
being awarded a Dan Glickman Pyramid of Excellence Award for School 
Nutrition Programs.
    Question. Please provide me with a report on proposals that would 
enhance the FNS support to West Virginia school child nutrition policy.
    Answer. Through the years, FNS has supported West Virginia child 
nutrition policy. To assist in West Virginia's comprehensive school 
health initiative, we worked with West Virginia to develop a multi-use 
free and reduced price application which would allow parents to request 
information about the State's Medicaid Program. That application became 
a model for other States.
    We anticipate that West Virginia will benefit from the new 
afterschool snack reimbursement in the NSLP and Child and Adult Care 
Food Program (CACFP). Afterschool snacks are intended to give children 
a nutritional boost and draw them into supervised activities that are 
safe, fun and filled with learning opportunities. Snacks served in 
afterschool care programs under the NSLP in a school or in the 
attendance area of a school where at least 50 percent of the enrolled 
children are eligible for free or reduced price meals will be 
reimbursed at the free rate. These schools are ``area eligible.'' 
Snacks served in afterschool care programs in schools that do not meet 
this criteria, that is, they are not area eligible, will be reimbursed 
at the free, reduced price and paid rate depending on the child's 
economic status. For the period July 1, 1998, through June 30, 1999, 
reimbursement is $0.5325 for free snacks, $02675 for reduced price 
snacks, and $0.04 for paid snacks. Additionally, Team Nutrition 
Training (TNT) grant projects have been and continue to be successful 
in promoting nutrition education. West Virginia received TNT grants in 
1995, 1996, 1997, and they have applied for a 1999 grant. The 1999 
grants have not yet been awarded.
                   small family farmers in appalachia
    Question. Mr. Secretary, I have become increasingly concerned about 
the plight of the small farmer of Appalachia. These farmers work hard 
on land most often held in the same family for generations, and I 
believe these farmers merit federal investment to ensure their future 
productivity, and more importantly, to preserve a heritage that I deem 
essential to this nation's moral fiber. There seems to be much talk 
about small family farmers, but I am dismayed at federal programs that 
define ``small'' to include ninety-five percent of all American 
farmers.
    Therefore, (1) I would appreciate a report on the status of the 
small family farmer of Appalachia, including their numbers, and their 
chances of future survival. (2) I would also appreciate a report on any 
current plans that you might have for this important farming segment.
    Answer. I share your concern for small farmers. In July, 1997, I 
appointed a National Commission on Small Farms to provide 
recommendations for improving the viability of small farms. This 
Commission recommended that small farms be defined as those farms with 
annual sales under $250,000. In the Appalachian region of Virginia, 
West Virginia, Kentucky, Tennessee, and North Carolina approximately 95 
percent of the 290,000 farms are considered ``small'' farms.
    Using USDA's 1997 Agricultural Resource Management Study, the 
Economic Research Service has described additional characteristics of 
farms in Appalachia which I will provide for the record. According to 
this report, approximately three-quarters of the farms are in a 
favorable financial position because they have a positive income and 
low debt. Only 2 percent have negative income and high debt which puts 
them in a vulnerable situation. Survival for these farms and the 
limited resource farms is the most problematic.
    Our programs and plans for small farms, including those of 
Appalachia, reflect the recommendations of the National Commission on 
Small Farms The Commission's report, A Time to Act, released in January 
1998, included 146 recommendations to improve USDA service to small and 
beginning farmers. Many of these recommendations have been implemented 
by USDA, including the establishment of the Office of Sustainable 
Development and Small Farms at USDA and the formation of the Council on 
Small Farms chaired by the Deputy Secretary.
    The Department has also restructured responsibilities of the FSA 
county committees, forcefully addressed long-standing civil rights 
issues, and streamlined loan processing. Legislation has removed 
restrictions on subsequent lending to borrowers approved for debt 
restructuring. USDA has supported producer-friendly tobacco settlement 
proposals, and expanded small farm research, extension and cooperative 
development programs in response to commission recommendations. Small 
farm training and outreach programs throughout the Department have been 
strengthened. USDA has also supported mandatory price reporting and 
country-of-origin labeling for beef and lamb, and has reorganized GIPSA 
to protect producers from unfair trade practices.
    The USDA budget for fiscal year 2000 includes $60 million for the 
Fund for Rural America, and proposes full funding for FSA direct 
ownership and operating loans, although at lower levels than 
appropriated with emergency funding in 1999. The budget also increases 
funding for the Sustainable Agriculture Research and Extension Program 
(SARE), the Appropriate Technology Transfer for Rural America program 
(ATTRA), Rural Cooperative Development Grants (RCDG), and outreach 
initiatives under the Section 2501 program.
    Sustainable Agriculture Extension, Renewable Resources Extension, 
and CSREES 1862/1890 formula funding for small farm programs would 
continue at current levels. The CSREES small farm initiative proposed 
in the budget for 1999 is proposed again for funding in 2000, and an 
increase in small farm program funding is projected under the National 
Research Initiative.
    Small farm marketing efforts are supported with continued funding 
for the Federal State Market Improvement Program (FSMIP), increased 
funding for the WIC Farmers Market Program, National Organic Standards, 
Wholesale Market Development, and strengthened livestock and poultry 
industry analysis. Small farm conservation initiatives include 
increased funding for the Stewardship Incentives Program (SIP). Further 
detail on the requests for additional funding can be found in the chart 
that is provided for the record.
    [The information follows:]
      data from usda's 1997 agricultural resource management study
    Almost two-thirds of Appalachian farmers either say that they are 
retired, but still farming, or that they have a major occupation other 
than farming. Households associated with these two groups depend on 
sources of income outside the farm. Another 13 percent are classified 
as limited resource farms. They have low farm sales, few assets and low 
household income. The Appalachian region has a higher proportion of 
these limited resource farms than most other regions.
    On average, total farm operator household income in 1997 for the 
region was $48,485. This is comparable to the average U.S. household 
and reflects the off-farm income received by farm households. Net farm 
income for farms in the Appalachia region was about $10,000. Many 
farms, even the small ones, have multiple owners and this net income 
from farming is shared with those owners.
    It is typical for farms to have financial losses in any given year, 
so the asset base that farmers have is very important. The average farm 
business in the Appalachia region had farm assets valued at $302,430 in 
1997. Even the low sales farms where the operator lists farming as the 
principal occupation have substantial assets at $377,115. Farms in the 
region are not heavily leveraged as the average debt-to-asset ratio was 
0.06.
    The Economics Research Service has prepared the following table 
that summarizes the characteristics of Appalachian farms.

                                            SELECTED CHARACTERISTICS OF FARMS IN THE APPALACHIA REGION, 1997
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Low sales/  High sales/
                   Item                       Limited   Retirement  Residential/    Farming     Farming      Large    Very large  Non-family   All farms
                                             resource                 lifestyle   occupation  occupation    family      family        \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Farms.....................................      37,177      51,860      132,473       50,736      10,027       5,006       3,177  ..........     292,000
Percent of farms..........................        12.7        17.8         45.4         17.4         3.4         1.7         1.1  ..........       100.0
 
Gross cash income.........................      $5,398     $11,975       $8,619      $26,573    $135,724    $271,713    $579,683  ..........     $28,478
Total expenses............................       5,976       9,744       10,119       22,935      94,950     204,147     361,816  ..........      23,160
 
Net cash income...........................        -577       2,239       -1,499        3,637      41,774      67,566     217,867  ..........       5,318
 
Net farm income...........................       3,131       8,200        3,261        9,190      44,128      61,906     193,453  ..........      10,404
 
Value of assets...........................      76,317     263,212      263,306      377,115     570,043     795,846   1,220,030  ..........     302,430
Liabilities...............................       1,675       7,663       12,623       17,962      65,069     127,057     289,030  ..........      18,774
Debt-to-asset ratio.......................        0.02        0.03         0.05         0.05        0.11        0.16        0.24  ..........        0.06
 
Financial position (percent):
    Favorable.............................          79          91           72           76          78          73          60  ..........          77
    Marginal income.......................          10           7           26           23           7          14           6  ..........          20
    Marginal solvency.....................           1           2  ............           1          11          11           4  ..........           2
    Vulnerable............................          10  ..........            1   ..........           5           2           5  ..........           2
 
Income from off-farm......................       9,600      32,425       61,207       44,649      21,848      25,106      43,168  ..........      44,157
Total household income....................      $8,827     $33,571      $58,740      $56,847     $50,438     $66,042    $184,614  ..........     $48,485
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ The sample for non-family farms in the Appalachian region does not allow statistically reliable estimates. There are approximately 1,500 non-family
  farms. We do not collect household income for the operators of these farms.
 
Source: USDA's 1997 Agricultural Resource Management Study.


     PROGRAMS RECOMMENDED FOR AN INCREASE IN FUNDING BY THE NATIONAL
                COMMISSION ON SMALL FARMS--PROGRAM LEVEL
                          [Dollars in millions]
------------------------------------------------------------------------
                                                    1999
           Program and Mission Area               Current    2000 Budget
                                                  Estimate
------------------------------------------------------------------------
Research, Education and Economics:
    Sustainable Agriculture Research and               $8.0         $8.5
     Extension (SARE).........................
    Sustainable Agriculture Extension.........          3.3          3.3
    1862/1890 Formula Funding for Small Farm            2.2          2.2
     Programs.................................
    Renewable Resources Extension.............          3.2          3.2
    Small Farm Initiative.....................  ...........          4.0
    National Research Initiative..............          5.0          7.0
                                               -------------------------
      Subtotal................................         21.7         28.2
                                               =========================
Rural Development:
    Fund for Rural America....................  ...........         60.0
    Appropriate Technology Transfer for Rural           1.3          2.0
     America (ATTRA)..........................
    Rural Cooperative Development Grants......          2.0          5.0
    Farmworker Housing Loans and Grants.......         31.4         40.0
                                               -------------------------
      Subtotal................................         34.7        107.0
                                               =========================
Marketing and Regulatory Programs:
    Federal State Market Improvement Program            1.2          1.2
     (FSMIP)..................................
    GIPSA Poultry and Livestock Market                  1.2          2.6
     Industry Analysis........................
    Wholesale Market Development..............          2.2          2.6
    National Organic Standards................          0.9          1.7
                                               -------------------------
      Subtotal................................          5.5          8.1
                                               =========================
Other:
    Outreach and Technical Assistance (Section          3.0         10.0
     2501)....................................
    WIC Farmers Market Program................         15.0         20.0
    NRE Stewardship and Incentives Programs            45.1         33.8
     \1\......................................
    Direct Ownership Loans....................         85.6        128.0
    Direct Operating Loans....................        733.8        500.0
                                               -------------------------
      Subtotal................................        882.5        691.8
                                               =========================
      Total...................................        944.4        835.1
------------------------------------------------------------------------
\1\ Includes Forestry Incentives Program, Forest Stewardship Program,
  and Stewardship Incentives Program.

                                 ______
                                 
                Questions Submitted by Senator Feinstein
                   child and adult care food program
    Question. In March, the USDA Inspector General released his audit 
of California's Child and Adult Care Food Program (CACFP). The audit 
focuses on ten sponsors whom USDA already suspected of fraud. These 
sponsors receive over 20 percent of the total $150 million in CACFP 
funds that go to California, so USDA feels that the extensive fraud 
being committed by these sponsors is indicative of tremendous problems 
within the California Department of Education's program. How long have 
these problems been occurring in California, and why have they not been 
addressed before?
    Answer. The Food and Nutrition Service (FNS) was aware that State 
and Federal program reviews had identified problems with program abuse 
and mismanagement by child care institutions and facilities. FNS 
requested that the Office of Inspector General (OIG) audit the Child 
and Adult Care Food Program (CACFP) in its efforts to determine the 
adequacy of program financial and administrative controls. The findings 
of the OIG validated the concern expressed by FNS, that select 
institutions were negligent in their administration and operation of 
CACFP. After OIG performed extensive work at the local level, they 
began their review of the State of California's oversight of the CACFP. 
FNS was not aware of the full magnitude of the problems in California 
until OIG completed their work at the State level. It was at this time, 
that FNS became aware of the systemic nature of the problems.
    Question. What steps does the Food and Nutrition Service plan to 
take to ensure that the State of California complies with the audit's 
recommendations to increase its oversight of high-risk sponsors, review 
all sponsor budgets, and improve coordination among the various units 
that administer the program?
    Answer. FNS has increased its oversight of the CACFP in California 
and is working with the State agency to ensure there are sufficient 
training and organizational controls in place for the CACFP. Since the 
issuance of the first management alerts and subsequent individual 
audits of sponsors and the State agency, FNS has been working with the 
State agency to strengthen CACFP integrity. In early 1998, FNS began 
working with the State agency to prioritize its resources to those 
sponsors which fit a problem sponsor profile and has continued working 
with the State agency to identify high-risk sponsors. In January 1999, 
FNS participated with the Office of Inspector General and the State 
agency in training State agency staff on sponsor fiscal management 
practices and identifying high-risk sponsors. To improve the 
coordination among the various units that administer the program, the 
State agency reorganized its audit function and created an Integrity 
Committee composed of audit, review, administrative, and management 
staff to determine effective plans of action for individual sponsors, 
and coordinate and determine State agency actions needed to ensure 
sponsor integrity. FNS' efforts with the State agency are ongoing and 
will be aided by additional funding now available to FNS through 
appropriations that are specifically earmarked for its integrity 
initiatives.
    Question. Will the Inspector General seek any monetary penalties 
against the State or against individual contractors?
    Answer. FNS establishes overclaims based on audit findings, not the 
Office of Inspector General. Further, program regulations do not allow 
for monetary penalties to be assessed against the State or local 
program operators. However, where a determination is made that Federal 
funds were not spent in accordance with the regulations, States are 
required to establish monetary overclaims and pursue the recovery of 
funds from local program operators. FNS may impose fiscal action 
against the State for failure to take appropriate collection actions 
against local program operators. In California, the State agency has 
established and pursued claims against program operators identified by 
the Office of Inspector General.
    Question. The audit also found that the Food and Nutrition 
Service's oversight of the California program has not been sufficient. 
What steps are you taking to improve that oversight?
    Answer. In its continuing effort to improve program management, FNS 
has increased oversight of the State agency's administration of the 
CACFP. The FNS Western Regional Office (WRO) has been working 
extensively with the State agency to address the OIG's audit findings 
and focus attention, resources and actions on issues identified through 
the audit to help the State agency to prioritize its resources to those 
sponsors which fit a problem sponsor profile. The FNS-WRO has worked 
closely with OIG pertaining to the actions taken by the State agency to 
correct problems, and has participated with the OIG and the State 
agency in training State agency staff. In March 1999, FNS conducted an 
evaluation of the State agency's program operations for the purpose of 
determining program compliance as well as offering technical assistance 
to improve program operations.
    A task force of State and Federal representatives provided 
assistance to FNS in the development of guidance materials for 
sponsoring organizations of family day care homes and centers as well 
as independent centers. CACFP standards for family day care home 
providers were published and distributed to State agencies in May 1997, 
and standards for independent and sponsored centers were published and 
distributed to State agencies in February 1998. These are comprehensive 
guides that address the local level operational problems that have been 
identified by the Inspector General. Additionally, FNS is currently 
developing a training program designed for all State agency staff 
directly involved in the administration of the CACFP. This National 
training initiative will occur at different locations around the 
country and will take place during the first half of fiscal year 2000. 
The purpose of the training will be to strengthen program management 
and will focus on institution budget and management plans, monitoring 
systems, internal controls and determinations of serious deficiencies. 
FNS' efforts with the State agency are ongoing and additional resources 
for this effort have been provided by specially appropriated funds to 
FNS.
                     food stamp caseload reductions
    Question. In 1994, 27.5 million people were collecting food stamps. 
In 1998, that number dropped to 19.8 million, a 28 percent reduction in 
the caseload. This dramatic drop is not fully explained by the strong 
economy and low unemployment. The actual number of people in poverty 
has not fallen nearly as dramatically; 36.6 million Americans were 
living in poverty in 1997, compared with 38.1 million in 1994. Has USDA 
seen a pattern of states discouraging families from applying for food 
assistance?
    Answer. USDA has not identified a pattern on a Nation-wide basis. 
We believe there is substantial compliance with our rules on access to 
food stamp benefits. However, we did detect instances of local 
departments implementing restrictive procedures in two urban areas. In 
each such instance, USDA reviewed the situation and is working closely 
with the State and Local agencies to assure that corrective measures 
are implemented.
    Question. What actions is the agency taking to better publicize the 
food stamp program and ensure that all eligible families who want 
assistance are served?
    Answer. When Secretary Glickman released the US Action Plan on Food 
Security on March 26, 1999, he announced a National campaign ``to 
inform those who are unaware of their eligibility that there is help 
for struggling families to get proper nourishment while they regain 
their economic footing.'' The campaign was spurred by recent 
information indicating that participation is falling faster than can be 
explained by a strong economy alone. We are particularly concerned that 
working families, the elderly and households with immigrant members 
have information about their eligibility and access to the program.
    FNS is currently finalizing our short-term and long-term strategies 
to meet the Secretary's goals. However, many activities are already 
underway. Some of the activities focus directly on our customers, that 
is eligible households who may not realize they are eligible for 
benefits. Other activities aim to enlist the assistance of our State 
partners, the welfare agencies that directly service recipients and the 
National, State and local organizations who work with or advocate for 
our customers. To ensure that eligible households have access to 
information, on April 9, 1999, we inaugurated a 1-800 number (1-800-
221-5689). Persons who call are sent basic information on Food Stamp 
Program (FSP) eligibility and how to find their local welfare agency 
that can provide benefits if they are eligible. Information that has 
been available in hard copy and through the FNS web page will be 
updated to ensure that it both contains needed information and is 
customer-friendly. In addition to printed materials we will also use 
our web page to make material available for downloading and local 
reproduction by anyone providing program information services.
    Since food stamp eligibility is determined by State and county 
welfare agencies, they and their cooperating community organizations 
are key to ensuring both that information on eligibility and how to 
apply is available and that welfare agencies and others make the 
application process user friendly. FNS is engaged in several efforts to 
encourage local activities to make sure that eligible families who want 
assistance are served. On January 29, 1999, FNS Administrator Sam 
Chambers wrote all State commissioners reminding them of application 
processing regulations and enlisting their assistance in making the FSP 
accessible to households that are leaving TANF for work but who remain 
eligible for food stamps. Our Regional administrators are talking to 
their States about this issue and the agency is supporting the efforts 
of community organizations who provide information and assistance to 
low income citizens. Secretary Glickman's Pyramid of Excellence Award 
for program operators offers an opportunity to showcase best practices 
in client services. FNS will be seeking out and awarding State and 
local agencies that provide excellent information and service and will 
be sharing with others the methods that have been successful.
              food stamp restoration for legal immigrants
    Question. How many legal immigrants do you expect to become 
eligible for food stamps under the Administration's budget proposal?
    Answer. We estimate that 15,000 legal immigrants will become 
eligible and choose to participate in the Food Stamp Program.
    Question. Do you know how many of the newly eligible recipients 
live in California?
    Answer. Prior to the enactment of welfare reform, nearly one third 
of legal immigrant food stamp recipients lived in California. 
Therefore, it is reasonable to suppose that roughly 5,000 new 
participants, representing one third of the 15,000 new participants 
Nationwide, will live in California.
    Question. Does the Administration support further food stamp 
restorations for legal immigrants, such as the proposal in the Fairness 
for Legal Immigrants Act to restore food stamps to all legal immigrants 
who were in the country in 1996?
    Answer. When the President signed welfare reform legislation in 
1996, he stated that some provisions went too far. Legal immigrants, 
individuals who have entered the country legally and have played by the 
rules, were especially affected.
    The Agricultural Research, Extension, and Education Reform Act, 
enacted in 1998, restored eligibility to the most vulnerable legal 
immigrants who were legally in the United States at the time welfare 
reform was enacted.
    A substantial number of legal immigrants who were in the country as 
of August 22, 1996, have not had food stamp benefits restored. The 
Agricultural Research, Extension, and Education Reform Act was a ``down 
payment'', but did not help everyone. The Fairness for Legal Immigrants 
Act goes much further in restoring eligibility for all those legal 
immigrants residing in the country on August 22, 1996. However, given 
limited resources, the Administration budget focuses on restoring 
benefits to those that were here before August 22, 1996, but who joined 
the ranks of the elderly after that date.
special supplemental nutrition program for women, infants, and children 
                                 (wic)
    Question. President Clinton has pledged full funding for WIC, but 
in California WIC administrators are being forced to cut 25,000 
participants from the rolls this year due to inadequate funding and a 
12 percent jump in the price of milk. How much of the requested 
increase in WIC funds will go to California, and how many more women 
and children will these funds serve?
    Answer. In February, California did in fact instruct its local 
agencies to cut caseload levels, which would have resulted in a total 
caseload reduction of approximately 25,000. However, due to the State 
agency's recent efforts to control costs by reducing the maximum 
reimbursement amounts paid to WIC vendors for all foods except infant 
formula, California now estimates that the savings from this step 
should provide enough funds so that these caseload reductions will not 
be necessary.
    We have not yet calculated State agency grants for fiscal year 
2000, and therefore do not know the specific grant amount that would be 
allocated to California. If adequate funding is available, California 
will receive its prior year grant plus an amount for inflation. The 
number of additional participants that California will be able to serve 
in fiscal year 2000 will be dependent on their food costs. Currently, 
California's food costs are one of the highest Nationally for 
geographic State agencies; we will continue to offer technical guidance 
and support to the State on controlling food costs through various cost 
containment initiatives, including vendor management.
    Question. Is the Administration considering any additional 
increases to the WIC program to offset the high cost of milk?
    Answer. Fiscal year 1999 food cost estimates in the President's 
fiscal year 2000 budget were constructed to take into account the 
relatively high cost of milk projected for fiscal year 1999. The 
administration is not planning to request a supplemental appropriation 
for fiscal year 1999 due to the higher milk costs.
    Question. The California WIC Association has raised serious 
concerns regarding the Food and Nutrition Service's proposed funding 
formulas rule. Among other issues, California is concerned that the 
salary component of funding allocations may be reduced; that proposed 
food inflation adjustments will not be sufficient; and that USDA is not 
appropriately calculating estimates of WIC eligibility in the State. 
What steps are you taking to address these concerns in the rulemaking 
process.
    Answer. A large number of comments were received on this issue from 
a variety of sources. The Department will give careful consideration to 
all comments in the development of the final rule.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
                    child nutrition--soda in schools
    Question. As I mentioned in my opening statement, I am concerned 
about the dietary habits of many Americans, especially our youth. I am 
aware that soft drinks are becoming the beverage of choice for many 
young people, which concerns me greatly. In fact, I wrote a letter to 
Secretary Glickman last month regarding this trend and the role USDA 
should be playing in promoting a healthy diet for our young. Would you 
please comment on this trend and provide your thoughts on how best to 
encourage our young people to consume more healthy beverages, such as 
milk, rather than soda pop?
    Answer. We in the Department of Agriculture share your concern that 
consumption of soft drinks appears to be increasing in our schools. As 
you know, the Department's regulations for both the National School 
Lunch Program (NSLP) and the School Breakfast Program (SBP) prohibit 
the sale of foods of minimal nutritional value, including carbonated 
beverages, in the food service area during meal periods. However, as a 
result of court rulings, they may be given away as long as the food 
service account is not used to purchase them, and they may be sold 
elsewhere in the school. And of course, children may select whatever 
foods they wish when they are outside the school.
    Since children have so many opportunities to select foods both 
inside and outside the school, there needs to be a three-way 
partnership to teach children to make sound food choices. First, the 
school meal programs need to provide children with a model of what an 
appealing and healthy diet can be. To this end, the Department 
continues to take an aggressive approach to ensuring that school meals 
meet nutrition standards, and we are providing State and local food 
service professionals with technical assistance to help them serve 
foods that provide the basic nutrients children need to grow and be 
healthy. The second partner is the education community. As I noted, 
other foods are available in the school, and we are working with our 
counterparts in the S. Department of Education to make State and local 
school officials aware of these nutrition issues so that they can lend 
their support to our efforts. The third and most important partner is 
the family. For our efforts to be successful, the family needs to be 
involved in helping children to learn the lesson of healthy eating. So 
much of what children learn in this area they learn at home, and we are 
working to help parents recognize the importance of balanced meals for 
health and well being.
    Question. What role could USDA Child Nutrition programs have in 
this context?
    Answer. We have a pivotal role in this undertaking. First, we need 
to provide a model food program, and this means helping our local food 
service professionals plan and prepare meals that contain nutritious 
foods. Just as important, we are working with our partners at the U. S. 
Department of Education and we are developing and distributing 
technical assistance materials for school administrators so that we can 
make the larger education community aware of the competition that foods 
of minimal nutritional value create for the reimbursable school lunch 
and breakfast. Finally, through Team Nutrition, we are developing and 
distributing materials designed to educate children, their parents and 
the community at large about the importance of sound nutrition and the 
necessity for children to eat balanced meals. As part of this overall 
undertaking, the Department is sponsoring a forum in June to discuss 
the role of school environments in promoting healthy eating behaviors 
in children. This forum will include experts in nutrition, health, 
education fields, advocates, political leaders and federal officials; 
and one of the prime objectives will be to explore ways that public and 
private groups can work together to reshape the social, educational and 
physical environment of schools to support dietary behaviors that 
contribute to a better quality of life for future generations.
           child and adult care food program--welfare changes
    Question. The Child and Adult Care food program was established to 
make sure free or reduced cost nutritious meals are available to 
children and adults in day care settings--whether they be family day 
cares or day care centers. I believe that this program is essential in 
getting good food to those who need it most--the young and the 
vulnerable. The program also serves to increase the quality of child 
care since participation in it requires far more frequent inspections 
than required by Federal or most State laws.
    However, I have heard some complaints that the 1996 welfare law 
changes to this program set up a complicated new reimbursement system--
especially for family day cares--that has led to more paperwork than 
food provision. I also know that at least 12 states are not 
participating in this program at all because of an outdated provision 
that dictates to them what mix of Federal pools of money they must use 
in order to be eligible for the Child and Adult Care Food Program 
(CACFP). These are problems that need to be fixed by the authorizing 
committee, I understand, but I would like to know from you today: What 
can you do under current law to lend technical assistance to states and 
CACFP sponsors to make sure we maximize the number of young children 
receiving healthy meals under this program?
    Answer. In reference to the two-tier reimbursement structure, from 
the beginning of the implementation process, the Food and Nutrition 
Service (FNS) has been very aware of the need for technical assistance. 
For this reason, the agency made it a high priority to provide training 
on the new system to all State and Regional staff in January and 
February of 1997, well in advance of the July 1, 1997, implementation 
date. It is our understanding that all State agencies held similar 
training sessions for their sponsoring organizations in the spring of 
1997. In addition, Under Secretary Watkins and agency staff made 
presentations on the two-tiered reimbursement system at several 
National and Regional conferences, including Save the Children/The 
Sponsor's Forum, the Sponsor's Association, and the California 
Roundtable--comprised of regional, State, and local program operators 
and advocacy organizations.
    With regard to States' pooling of subsidies for low-income child 
care, which affects the ability of for-profit centers to participate in 
CACFP, you are correct in noting that this is a feature of the National 
School Lunch Act. The law requires that at least 25 percent of a for-
profit center's enrollment or licensed capacity be supported by Title 
XX funds. This requirement provides a basis for determining that a for-
profit center is actually serving a substantial percentage of low-
income children.
    However, since the advent of the Child Care Development Block Grant 
(CCDBG) in 1990, Title XX is no longer the primary source of Federal 
subsidies for low-income child care. In order to counter the 
diminishing Title XX funds used in child care, many States have, after 
discussion with USDA, included their reduced Title XX funds in a 
funding pool along with other subsidies such as the CCDBG. As you note, 
thirteen States currently have no for-profit participation in CACFP 
because they have not used Title XX funds to subsidize child care; 
other States have very low levels of for-profit participation because 
they do not pool Title XX child care funds with other sources of 
Federal support for low-income child care.
    To ensure that States are aware of the acceptability and advantages 
of pooling, the Department plans to reissue guidance on pooling to all 
State CACFP directors in the near future.
                     meals in after school centers
    Question. The Child Nutrition Act reauthorization provides snacks 
for participants in certain after school centers and full meals to 
children under 12. This is becoming more vital as we see more and more 
children in--or in need of--after school and off-hour evening programs 
while their parents work. Has USDA given any thought to the effects of 
expanding the full meal allowance to all children as a way to improve 
educational performance and to encourage children ages 12 to 17 to 
participate in after-school programs--programs that have proved 
successful in keeping these older kids safe and away from criminal 
activity?
    Answer. The National School Lunch Act as amended by the William F. 
Goodling Child Nutrition Reauthorization Act of 1998, made provisions 
for snacks to be provided to children in afterschool programs designed 
to meet the needs of the at-risk population through the age of 18. The 
snacks would be provided to children in structured after-school 
activities through the National School Lunch Program (NSLP) and the 
Child and Adult Care Program (CACFP). FNS has also been working 
together with the Department of Education on a variety of programs 
geared to meet the needs of children in after-school programs. Under 
Secretary Watkins and a number of other agency officials have 
participated in a number of after-school rollout events across the 
country, and we hope to see many more.
    While the law authorizes only a snack in the at-risk component of 
NSLP and CACFP, we believe this to be a good start. The snack will 
greatly assist schools and non-profit organizations in keeping the 
interest of these adolescents through a structured activity coupled 
with the nutritious snack. Although we do not provide reimbursement for 
a full meal served in at-risk programs, we do encourage after-school 
care programs to provide more food to older children to meet their 
increased nutritional needs. This being said, we believe an expansion 
of the snack program to a full meal would greatly increase program 
costs. At this time, the effectiveness of providing snacks for 
afterschool programs needs to be evaluated before further changes 
should be considered so that any additional adjustments to the program 
can be better focused.
                            wic immunization
    Question. The WIC Program has long been one of the most popular and 
successful programs in the federal government. In addition to the 
direct nutritional benefits, there are other long-term health benefits 
from WIC program features such as the WIC Immunization program.
    Could you please summarize the status of the WIC-related programs 
and provide your views on the value of their long-term benefits?
    Answer. The WIC Program recently celebrated its 25th Anniversary. 
Since the Program's inception in 1972, population-based research has 
increasingly demonstrated the importance of the kinds of 
supplementation, education, and referral services the program provides 
to both short-and long-term educational and health outcomes.
    Research studies have provided a substantial body of evidence 
concerning WIC's effects on birth outcomes, health care costs, diet and 
diet-related outcomes, infant feeding practices, immunization rates, 
and cognitive development.
Birth Outcomes and Health Care Costs
    Infants who are born premature or at low birth weight account for a 
disproportionate share of health care costs, but studies suggest that 
the WIC Program has been playing an important role in improving birth 
outcomes and containing costs.
    A series of reports published since 1990 have found that pregnant 
women who participate in WIC during their pregnancies have 
significantly longer pregnancies, fewer premature births, a lower 
incidence of moderately low and very low birthweight, fewer infant 
deaths, and a greater likelihood of receiving prenatal care relative to 
similarly low-income women who do not participate in WIC. Associated 
with these improvements in birth outcomes were significant savings in 
health care costs.
    The 1990 WIC Medicaid Study found that prenatal participation in 
WIC by low-income women was associated with savings of $1.77 and $3.13 
in Medicaid costs in the first 60 days postpartum for each dollar spent 
on WIC.
    A more recent study (WIC: Analysis of the 1988 National Maternal 
and Infant Health Survey, 1995) found similar relationships among WIC 
participation and birth outcomes in a Nationally representative sample 
of WIC participants, suggesting that the positive effects of WIC are 
not limited to the most disadvantaged segments of the low-income 
population
Diet and Diet-Related Outcomes
    The WIC Program provides participants with a supplemental food 
package high in nutrients that are critical to periods of rapid growth 
and development such as pregnancy and early childhood, and which are 
also important during postpartum recovery and lactation.
    The National WIC Evaluation found that children participating in 
WIC had higher mean intakes of iron, vitamin C, thiamin, niacin and 
vitamin B6, without an increase in food energy intake, indicating an 
increase in the nutrient density of the diet.
    Other studies have documented reductions in iron deficiency anemia 
associated with WIC, and an increase in fruit and vegetable consumption 
among WIC participants who received Farmers' Market coupons through 
WIC.
Infant Feeding Practices
    The American Academy of Pediatrics currently recommends that 
infants be fed breastmilk or an iron-fortified infant formula from 
birth to 12 months of age, and that other foods not be introduced until 
the infant is four to six months of age. Introduction of cow's milk in 
the first year of life is associated with intestinal bleeding, anemia, 
and allergies.
    Two FNS studies to date (WIC Breastfeeding Report, 1992 and WIC 
Infant Feeding Practices Study, 1997) have found that overall rates of 
breastfeeding initiation among WIC participants are below Healthy 
People 2000 and 2010 goals, consistent with their more disadvantaged 
socioeconomic status. However, both studies found that those who 
receive breastfeeding advice and support from WIC are more likely to 
breastfeed than similarly low-income women who do not receive such 
advice and support.
    WIC also increases the likelihood of appropriate feeding among non-
breastfeeding women. The National WIC Evaluation found that WIC infants 
were significantly more likely to be fed infant formula than controls. 
They were also significantly less likely to be fed whole cow's milk in 
the first year of life. More recent data from the 1988 National 
Maternal and Infant Health Survey also found that WIC infants were less 
likely to be fed cow's milk than eligible non participants. The WIC 
Infant Feeding Practices Study (1997) found that early introduction of 
cow's milk is not a common problem among WIC mothers. It also found 
that women who received infant feeding advice from WIC were less likely 
than others to introduce cereal into their infants' diets 
inappropriately early.
Immunization Rates and Regular Source of Medical Care
    Over the last several decades, vaccines have significantly reduced 
the number of people contracting life-threatening illnesses such as 
typhoid, measles, and polio. However, immunization rates are lower 
among low-income individuals. A regular schedule of immunizations is 
prescribed for children from birth to two years of age, which coincides 
with the period in which many low-income children participate in WIC.
    The National WIC Evaluation found significantly improved rates of 
childhood immunization and of having a regular source of medical care 
associated with WIC participation. Since then, emphasis on immunization 
status assessment, education, and referral have increased.
Cognitive Development
    Cognitive development influences school achievement and behavior.
    The National WIC Evaluation found that by ages 4 to 5 years, 
children enrolled in WIC prenatally had better vocabulary scores, and 
children enrolled in WIC after the first year of life had significantly 
better memory for numbers.
    In summary, the evidence indicates that WIC facilitates the receipt 
of timely and appropriate immunizations and prenatal care, assists in 
the development of healthy eating habits for pregnancy and for life, 
prevents poor birth outcomes, and reduces anemia and other dietary 
problems. In doing so, WIC prevents problems that are known to hinder 
early learning and long-term educational outcomes. It may also play an 
early role in the prevention and management of debilitating conditions 
such as cancer and heart disease that often strike adults in later 
years, and which have been increasingly linked to diet.
             food stamp program--effects of welfare reform
    Question. We see in USDA's budget materials that Food Stamp 
participation is falling while requests for the WIC program continue to 
climb. How do you account for the fall in one program and an increase 
in the other?
    Answer. The Food Stamp Program is an entitlement program designed 
to respond to changing needs during times of economic expansion and 
contraction. Legislative changes in eligibility criteria affect 
participation levels from one year to another, and people who are 
eligible for food stamps must also choose to apply for them.
    Food stamp participation has fallen dramatically, by 9.7 million 
persons between March 1994, the peak, and February 1999, the latest 
data we have. Part of this drop can be explained by the strength of the 
economy and the success of welfare reform, which has helped to move 
families from welfare to work. Part of the drop is due to new 
restrictions on the participation of legal immigrants and able-bodied 
unemployed adults without dependent children.
    But other factors may also be at work. Between 1995 and 1997, food 
stamp participation fell five times as fast as poverty, a sign that the 
nutritional needs of some low-income people may be going unmet. The 
number of people in poverty fell by 850,000 over this period while the 
number of food stamp participants fell by 4.4 million, suggesting that 
many poor families have left the program despite their continuing 
eligibility.
    Unlike the Food Stamp Program, participation in the Special 
Supplemental Nutrition Program for Women, Infants and Children (WIC) 
increased from 6.5 million in fiscal year 1994 to 7.4 million in fiscal 
year 1998. WIC serves a different population, with families with 
incomes of up to 185 percent of the poverty line eligible.
    As the economy has improved in recent years, the number of persons 
estimated to be eligible for WIC has declined somewhat. Yet, there are 
still many unserved eligible mothers, infants and children. Our best 
estimates indicate that current participation is more than 1 million 
persons below the number eligible to participate.
    Question. To what extent are these changes results of Welfare 
Reform?
    Answer. From 1994 to 1997, over 800,000 legal permanent residents 
and 500,000 ABAWDS left the food stamp roles. The numbers, however, do 
not reflect the impact of immigrant restorations and new Employment and 
Training funds in Agriculture Research. To the best of our knowledge, 
no one has yet been able to determine what percent of the drop in food 
stamp participation is attributable directly to the success of welfare 
reform in moving people from welfare to work. In January 1998, the 
Congressional Budget Office observed that the rapid decline in food 
stamp caseload was something of a mystery. The same can be said today. 
While several contributing factors are easily identified, including the 
success of welfare-to-work efforts, the relative importance of these 
factors has so far resisted quantification.
    Question. What special management and/or budgetary problems is USDA 
experiencing in the administration of the Food Stamp, WIC, and other 
programs as a result of Welfare Reform?
    Answer. In addition to the direct impact of the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) 
on the Food Stamp Program (FSP), there are a number of management 
issues that resulted from the Act's elimination of the Aid to Families 
with Dependent Children (AFDC) program, and the creation of the 
Temporary Assistance to Needy Families (TANF) program:
  --Ensuring FSP Access.--Since passage of PRWORA, Food Stamp caseloads 
        have fallen more quickly than can be explained fully by the 
        changes in eligibility rules, the strength of the economy and 
        the success of welfare reform. The drop in FSP participation, 
        which significantly exceeds the decline in the poverty rate, 
        suggests that many poor families have left the program despite 
        their continuing eligibility. Problems related to the 
        transition to TANF may be a factor; the TANF emphasis on moving 
        people off cash assistance may have inadvertently reduced Food 
        Stamp Program participation. Some families who leave TANF for 
        work may not be aware that they still may be eligible for food 
        stamps; however, we did detect limited instances of local 
        departments implementing restrictive procedures in two urban 
        areas. In each such instance, USDA worked closely with the 
        State and local agencies involved to review the situation and 
        to assure that corrective measures were implemented.
  --Administrative Cost Offset.--Soon after passage of PRWORA, Congress 
        recognized that States might charge the FSP for administrative 
        costs that were previously paid by AFDC and grandfathered into 
        the TANF grant amount. As a result, Congress enacted an 
        administrative offset provision to prevent ``double payment'' 
        of these costs by the Federal government. For fiscal years 1999 
        through 2002, FNS will reduce Federal amounts otherwise paid to 
        States for administrative costs of the FSP by amounts HHS 
        determined were grandfathered into the TANF grant. The agency 
        began implementing this provision on April 1,1999.
  --FSP/TANF Conformity.--FNS finds increasing interest from States to 
        make FSP rules conform to TANF rules--which vary from State to 
        State--or to make FSP rules support TANF work philosophy. In 
        certain cases, States have been given the opportunity to do so. 
        For example, States can conform some of their sanction policies 
        to match TANF sanctions; 7 States have decided to reduce FSP 
        benefits for non-compliance with TANF rules. While this option 
        gives States additional flexibility, it also adds to 
        administrative complexity and burden at the Federal level. Many 
        conforming changes proposed by States increase Federal costs, 
        or adversely effect household eligibility.
  --Quality Control.--One important FSP/TANF conformity issue is 
        quality control. Under TANF, States are no longer required to 
        administer a quality control system to measure benefit 
        accuracy; in addition, TANF requires new measures of State 
        performance. States have expressed concerns about operating 
        quality control for the food stamps alone, and have suggested 
        that FNS consider new performance measures that are integrated 
        with the TANF requirements for new measurement systems.
  --Public Charge Issues.--Implementation of welfare reform legislation 
        has raised questions about whether non-citizens who participate 
        in Food Stamps, Child Nutrition and WIC programs are ``public 
        charges''--non-citizens who must rely on the U.S. government 
        for support. Public charge status potentially can result in 
        deportation, denial of entry into the United States, or denial 
        of changes in alien status.
    Working with the Immigration and Naturalization Service (INS), FNS 
has determined and communicated to State program cooperators that 
participation in Food Stamps, Child Nutrition and WIC programs does not 
render a non-citizen a public charge. This FNS policy is based on 
interim guidance from the INS, which is in the process of issuing more 
formal guidance. However, it is evident that Federal and State 
governments must continue to work to communicate and educate at local 
grassroots levels to assure that civil law groups, program operators, 
advocates, universities, and participants themselves all fully 
understand that alien status has no bearing on eligibility for Food 
Stamps, Child Nutrition or WIC programs, and that such participation 
does not constitute a public charge issue.
  --Indian Tribal Issues.--TANF permits Indian tribes to directly 
        administer TANF. Tribes are beginning to administer TANF and as 
        a result FNS is seeing more interest from tribes in the 
        administration of the FSP as well. FNS is considering how to 
        respond to this interest, given that the Food Stamp Act allows 
        tribal administration of the FSP only if States cannot 
        administer the program.
    Question. Currently, the State of Wisconsin is requesting you to 
exercise waiver authority provided by Welfare Reform that would allow 
the state to privatize certain elements of the Food Stamp program? What 
is the status of this request?
    Answer. The State of Wisconsin submitted its waiver on August 5, 
1998. On October 5, 1998, FNS requested clarification from the State 
about a number of program, finance, and technology issues. Our letter 
also requested clarification about how the State would evaluate the 
demonstration project. The State's initial request did not include a 
research design describing how the demonstration would be evaluated. At 
the State's request, we have participated in several conference calls 
to assist the State in its development of a research design. The State 
submitted its research design on March 1, 1999. We are in the final 
stages of reviewing the waiver and will be providing the State with a 
final answer soon.
    Question. Have similar waivers for other states been granted? Why 
or why not?
    Answer. FNS has not approved any waiver allowing a State to 
privatize the Food Stamp Program's certification and eligibility 
determination process. One demonstration waiver request from the State 
of Arizona was denied December, 1998, because FNS determined the 
State's request did not ensure program access for food stamp applicants 
and recipients. More specifically, the request did not provide adequate 
justification to waive the requirement for the use of merit employees 
(public) in the certification process that results in the final 
determination of program eligibility. FNS can waive Food Stamp Act 
requirements to test alternative methods that would further improve 
administration and meet the nutrition assistance goals of the Food 
Stamp Program.
    To date, FNS has denied one waiver request (Arizona) and is in the 
process of reviewing a demonstration waiver request from the State of 
Wisconsin. The State of Florida submitted a demonstration waiver 
request to FNS January, 1998. FNS is waiting for a response to our 
request for clarification on a number of issues. Finally, the State of 
Texas sought to privatize the Food Stamp Program's certification 
process Statewide. The State of Texas was not seeking a demonstration 
waiver request. The Administration advised the State that the Food 
Stamp (and Medicaid) certification process must, by law, be conducted 
by public employees. Question. The Washington Post reported last month 
that welfare reform has resulted in a certain ``chilling effect'' among 
certain parts of our population, especially immigrants who are eligible 
for benefits, as a reason for the decline in program utilization.
    Question. Is that the case with the Food Stamp Program?
    Answer. Restrictions on participation by legal immigrants may have 
deterred participation by their children, many of whom retained 
eligibility for food stamps. Between September 1996 and September 1997, 
participation among U.S.-born children living with their legal 
immigrant parents fell significantly faster than participation among 
children living with native-born parents. During this period, the 
number of participating U.S.-born children living with legal immigrants 
fell by 37 percent, versus 15 percent of children living with native-
born parents. The source of data for this is the Food Stamp Program 
Quality Control data.
                        studies and evaluations
    Question. For the past couple of years, the Studies and Evaluation 
functions of the Food and Nutrition Service have been placed with the 
Economic Research Service. Is there proper coordination between the 
nutrition programs and other USDA agencies regarding information?
    Answer. The Food and Nutrition Service and the Economic Research 
Service (ERS) have made a good faith effort to create a practical study 
agenda that responds to the operational needs of the Nutrition 
Assistance Programs. This effort helped shape some of ERS' funding 
decisions and resulted in an agreement between the two agencies that 
allows FNS to pursue some of our operational study priorities with ERS 
funding support. However, because the agencies have fundamentally 
different research goals and methods, the agency firmly believes that 
effective program management can best be supported by locating the 
studies and evaluation functions within FNS. This will ensure tat 
important policy issues in FNS programs are addressed in the agenda.
    Effective program management requires a strong study and evaluation 
function that is sensitive and responsive to emerging policy issues and 
the needs of program operators. This is best achieved by maintaining 
such a function within the agency responsible for Federal Nutrition 
Assistance Programs. While both FNS and ERS have important roles to 
play in developing research that supports the FNCS mission, managing 
the right kind of applied studies and evaluations requires the program 
expertise, sensitivity to evolving policy issues, and relationships 
with multiple stakeholders that can only be developed and sustained 
within FNS.
    Question. Secretary Watkins, would you like to comment on reasons 
for which these activities should be returned to the Food and Nutrition 
Service?
    Answer. In a nutshell, I firmly believe that effective program 
management requires a strong study and evaluation function that is 
sensitive and responsive to emerging policy issues and the needs of 
program operators. This is best achieved by maintaining the study and 
evaluation function within the agency responsible for critical 
Nutrition Assistance Programs.
    Restoration of FNS study and evaluation funding is critical to the 
effective management, administration, and oversight of Federal 
Nutrition Assistance Programs. Lawmakers, Federal and State 
policymakers and program operators need access to high-quality, 
practical research findings grounded in the experience of program 
operators. Managing the right kind of applied studies and evaluations 
requires the program expertise, sensitivity to evolving policy issues, 
and relationships with multiple stakeholders that can only be developed 
and sustained within FNS.
    The ability to establish and carry-out the study agenda is an 
essential tool in managing the nutrition programs under my 
jurisdiction. The importance of effective strategic planning for 
results requires timely data and analysis. Under the current 
arrangements, the research foundation for strategic planning, problem 
definition, policy change and innovation rests in another mission area 
within USDA. This division between research and program operations has 
made management of program improvements and ongoing operations 
significantly more difficult.
            nutrition, education and training program (net)
    Question. One of the things that the Child Nutrition Act 
reauthorization did not do last year was to return the Nutrition, 
Education, and Training (NET) program as a mandatory item. 
Consequently, no funding was provided for NET in fiscal year 1999. 
Please describe the effect this lack of funding has had on the 
administration of feeding programs this year.
    Answer. Because there has generally been no funding for NET 
activities this year, the traditional support that NET has provided to 
the programs has been unavailable. While we do not have conclusive 
data, the information available to us suggests that training and 
technical assistance efforts have been greatly diminished due to the 
lack of funding, and if funding is not restored as soon as possible, 
the positive impact of NET will cease to exist and the infrastructure 
that has taken years to build will dissipate. For these reasons, it is 
vitally important that the program receive the minimal funding 
requested in the President's budget and that a solution to permanent 
funding for NET be found.
    Question. Please explain the primary reasons this funding should be 
restored.
    Answer. NET performs an extremely valuable service to the Child 
Nutrition Programs by providing a link at the State level for Federal 
training and technical assistance efforts. Moreover, NET enables States 
to tailor materials and assistance specifically to the needs of their 
local operators. Finally, by making grants available to local 
operators, NET is able to support creative initiatives at the local 
level for a modest investment. In short, NET provides a significant 
complement to other programs, such as Team Nutrition, which are 
intended to help local professionals plan and prepare meals which are 
both nutritious and appealing.
    Question. I have noted from time to time, public announcements in 
various locations that up to 25 percent of the areas children go to bed 
hungry every night. These announcements are usually associated with 
appeals for contributions to food banks or some other form of food 
assistance outlet. Still, given the level of assistance provided 
through USDA and other federal, state, local, and charitable 
organizations. I am struck by what seems a very high percentage of 
children in the United States living in this condition. Please provide 
information relating to the status of hunger in the United States, 
especially among the young, elderly, and other vulnerable populations 
and the level to which USDA programs are meeting those needs.
    Answer. Despite America's ability to produce more food than it can 
consume, food insecurity and hunger still exists. In September 1997, on 
the occasion of the first National Summit on Food Recovery and 
Gleaning, we released the results of USDA's comprehensive effort to 
measure the extent of hunger as commonly understood by most Americans. 
Our estimates are based on the pattern of responses among about 45,000 
households in a supplement to the Current Population Survey (a 
Nationally representative sample selected and interviewed by the Bureau 
of the Census).
    The results tell us that hunger existed among persons in 4.2 
million households, about 4.1 percent of all households, at some time 
during the year ending in April 1995. Not all households are equally 
likely to experience hunger. A larger proportion of households with 
children (5.3 percent) and a smaller proportion of households with 
elderly (1.9 percent) experienced hunger. Black and Hispanic households 
with children were about twice as likely to experience hunger as their 
White counterparts. Households headed by single women were four times 
more likely to experience hunger than households headed by married 
couples. And the chance of experiencing hunger increased as income 
fell.
    The Nation's Nutrition Assistance Programs--food stamps, school 
meals, WIC--are in the front lines of the fight to end hunger and 
improve nutrition. More than 18 million people receive food stamps, 
over 26 million receive a school lunch, and over 7 million women, 
infants, and children receive supplemental foods. But everyone can and 
should play a role. Earlier this year, Secretary Glickman unveiled his 
Community Food Security Initiative to create partnerships that will 
help communities help themselves, to work at the grass roots to weed 
out hunger.
                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                      Food and Drug Administration

STATEMENT OF JANE E. HENNEY, M.D., COMMISSIONER
ACCOMPANIED BY:
        MICHAEL A. FRIEDMAN, M.D., DEPUTY COMMISSIONER FOR OPERATIONS
        ROBERT J. BYRD, DEPUTY COMMISSIONER FOR MANAGEMENT AND SYSTEMS, 
            CHIEF FINANCIAL OFFICER
        DENNIS P. WILLIAMS, DEPUTY ASSISTANT SECRETARY FOR BUDGET, 
            DEPARTMENT OF HEALTH AND HUMAN SERVICES

                            OPENING REMARKS

    Senator Cochran. Our next panel this morning is from the 
Food and Drug Administration. We're pleased to welcome the 
Commissioner, Dr. Jane Henney. Also with the Commissioner, we 
have Dennis Williams, Deputy Assistant Secretary for Budget of 
the Department of Health and Human Services; Dr. Michael A. 
Friedman, Deputy Commissioner for Operations; and Robert J. 
Byrd, Deputy Commissioner for Management and Systems, and FDA's 
Chief Financial Officer.
    Earlier this year, the committee held a food safety hearing 
at which Dr. Henney and others appeared to help us consider the 
budget request as it related to food safety initiatives and our 
effort to make sure that a healthy wholesome food supply 
continues to be available to America's consumers.
    FDA has a very important role to play in that, and 
important statutory responsibilities, along with the Department 
of Agriculture and other agencies. So, we had that hearing 
already. Today's hearing will look at other obligations and 
activities of the FDA that are funded in this budget request.
    We're aware of a lot of the initiatives of this agency. Its 
responsibility extends from medical devices to animal drugs to 
blood products. Not only does it regulate these domestic 
products, but it also has the responsibility of monitoring 
imports of these same products to ensure their safety and 
effectiveness for the public's use and consumption.
    Dr. Henney, welcome. We ask you to make whatever comments 
and description of the budget request that you think will be 
helpful to our committee. Thank you very much.
    Dr. Henney. Mr. Chairman, members of the committee, I am 
truly honored to address you as the Commissioner of Food and 
Drugs. It's a privilege today to present the agency's plans and 
expectations as reflected in the administration's proposed 
budget for fiscal year 2000.
    I would also like to take this opportunity to share with 
you my thoughts on where I hope to lead the Food and Drug 
Administration, both the tasks that I believe are most urgently 
demanding the agency's attention and perhaps as important, my 
approach to these tasks which emphasizes a commitment to 
heighten effectiveness and an openness to our constituencies.
    Many of the things that I remembered about FDA's dedication 
to the health and safety of Americans have not changed since I 
left the agency several years ago but I am reminded on nearly a 
daily basis how much has changed since I was last here.
    The FDA Modernization Act, the administration's reinventing 
government initiatives and the Prescription Drug User Fee Act 
have triggered significant changes in many of the agency's 
processes and outcomes.
    One of the most important changes that has followed the FDA 
Modernization Act is a renewed commitment to listen and learn 
from those affected by FDA regulations--consumers, patients and 
the industry. I firmly believe that we must seek out and listen 
to the views of all.
    My early focus has also been on an issue within the agency. 
As I promised in my confirmation testimony, I have conducted a 
reorganization study of the office of the commissioner. And, as 
a result, I have realigned certain functions within the 
commissioner's office and moved other functions to the centers.
    The steps I am taking will reduce the size of the office of 
commissioner by approximately 12 percent while moving those 
resources closer to where the programmatic work of the agency 
is most appropriately conducted.
    However, I am here today to request your support for a 
substantial increase in FDA's budget, indeed, the largest 
requested increase in the agency's history.
    This request is intended to allow us to begin to rebuild 
our capabilities, to strengthen our science base, the 
foundation of sound regulatory decisions, and to continue 
several long-range high priority programs that are vital for 
the protection of the public health.
    As large as this budget request is, it provides only the 
first steps toward rebuilding an effective agency able to carry 
out its basic responsibilities and to respond to emerging 
public health problems.
    Among those priorities, number one, is the full 
implementation of the FDA Modernization Act. I am committed to 
the full and effective implementation of this law both in its 
letter and spirit. Recognizing the priority that Congress gave 
to enactment of the FDA Modernization Act, the FDA has devoted 
unprecedented resources to implementing the new statute within 
the timeframe set forth in the Act.
    The agency has completed over 80 FDA modernization actions 
and has met nearly all of its statutory deadlines at the same 
time continuing to perform the other important tasks that the 
American people have come to expect from us.
    As directed by the Act, FDA has undertaken a comprehensive 
analysis of what needs to be done to meet the agency's 
statutory obligation. FDA has identified three programmatic 
areas that must be addressed beginning with the fiscal year 
2000 budget in order to meet statutory obligations and to 
provide the level of public health protection expected by 
American consumers.
    These three areas are injury reporting, product safety 
assurance and pre-market application review.
    With respect to injury reporting, at present no integrated 
system for the reporting, monitoring and evaluation of all FDA 
regulated product related injuries currently exists. Therefore, 
the administration is requesting a total of $15.3 million to 
begin critically needed improvements to the FDA injury 
reporting system.
    With respect to product safety assurance, FDA is 
responsible for monitoring the safety and quality of a rapidly 
growing number of increasingly complex products from domestic 
and foreign sources.
    FDA's ability to meet this responsibility through 
inspections and enforcement actions even in conjunction with 
its state partners has significantly declined. The agency is, 
therefore, requesting $52.2 million in fiscal year 2000 to 
increase its inspectional and enforcement capabilities.
    Third, pre-market application review. Although FDA product 
review times in programs benefiting from user fees have shown 
dramatic improvements, other categories of product reviews for 
which we did not receive user fees continue to suffer from 
unacceptably long review times.
    While we will continue to undertake management initiatives 
to attempt to meet these deadlines, the administration is 
asking for $28 million in both new appropriated funds and new 
added user fees to improve review times for food additive 
petition reviews, food contact substantive reviews and the more 
complex of the medical device reviews.
    A second area of major priority for the agency is to 
strengthen the science base of the agency. I believe this is an 
urgent issue. The increasing investments made in both basic and 
applied research by the National Institutes of Health and the 
pharmaceutical, biotech and medical device industries will 
result in a burgeoning growth of new products.
    FDA must have the scientific sophistication necessary to 
understand and adequately and properly evaluate these products.
    With respect to a third area of high priority, as you have 
already mentioned, Mr. Chairman, I did appear before this 
committee on March 16th to address food safety issues.
    The agency did receive additional appropriations for food 
safety in fiscal year 1998 and 1999 and it has used these funds 
to lay a solid foundation for improving our food safety 
programs. Our fiscal year 2000 budget request includes $30 
million for food safety activities.
    A fourth area is the safety of the blood supply. Each year 
more than 3.5 million Americans receive blood from volunteer 
donors. While blood and blood derivatives can be life saving, 
blood products can pose risk to patients. At the same time, 
shortages of blood can be life-threatening.
    The administration is requesting $6.2 million for FDA's 
blood safety initiative as part of the overall increase of 
$52.2 million which as I mentioned before is requested for 
product safety assurance.
    A fifth area is tobacco. The administration recently has 
renewed its commitment to reducing young people's use of 
tobacco products. We are pleased that the Supreme Court has 
agreed to hear the case regarding FDA's regulation of tobacco. 
Our budget request before you includes a $34 million increase 
in funding for our tobacco program.
    In conclusion, Mr. Chairman, and members of the committee, 
FDA is an agency that has prided itself on being a can-do 
agency. But it is clear that the agency can't do everything 
without additional resources. The funds that we are asking you 
to appropriate in this budget will make great strides towards 
moving us toward these goals.

                           PREPARED STATEMENT

    I make a public commitment to you today that if we are 
given these funds we will spend them wisely and well.
    [The statement follows:]
                  Prepared Statement of Jane E. Henney
                              introduction
    Mr. Chairman, members of Congress, ladies and gentlemen, my name is 
Jane Henney. I am honored to address you as the Commissioner of Food 
and Drugs. It is my privilege today to present the Agency's plans and 
expectations as reflected in the Administration's proposed budget for 
fiscal year 2000. I also would like to take this opportunity to share 
with you my thoughts on where I hope to lead the Food and Drug 
Administration in the coming months: both the tasks that I believe most 
urgently demand the Agency's attention, and perhaps as important, my 
approach to those tasks, which emphasizes a commitment to heightened 
effectiveness and an openness to our constituencies.
    Let me begin by offering a few reflections on my first five months 
as Commissioner. Fortunately, many of the things that I remembered 
about FDA's dedication to the health and safety of Americans have not 
changed since I left the Agency several years ago. The FDA is filled 
with energetic, hardworking, talented people. There are strong 
traditions throughout the Agency of protecting and promoting the public 
health. These are traditions that I will seek to preserve. I also am 
reminded, on a daily basis, of how much has changed since I was last 
here. The FDA Modernization Act (FDAMA or the Act), the 
Administration's Reinventing Government initiatives, the Animal Drug 
Availability Act, and the Prescription Drug User Fee Act have triggered 
significant changes in many of the Agency's processes and outcomes.
    One of the most important changes that has followed FDAMA is a 
renewed commitment to listening to those affected by FDA regulation: 
consumers, patients, and the industry. FDAMA directs the Agency to be 
in touch with all of its constituencies. I firmly believe that we must 
seek out and listen to the views of all. This is critical to the 
continued effectiveness of the Agency. As an old English proverb says, 
``Only the wearer knows where the shoe pinches.''
    As I will explain in more detail later, the Agency has formally 
undertaken its statutory obligation to consult with stakeholders. In 
the same spirit, I, too, have undertaken in my first months in office 
to meet with members of the regulated industry, consumers, and the 
academic community. I have visited seven FDA field offices and have 
plans to visit nearly all of our districts throughout the country 
during the coming year. These visits have allowed me not only to meet 
and hear directly from FDA's field staff, but to meet with important 
constituencies in each district, as well. For example, when visiting 
our district office in Denver, I met with the Southwest Medical Device 
Grassroots Coalition, a group of device manufacturers. While in 
Chicago, I held an open forum to listen to the concerns of drug, 
device, and food manufacturers, State officials, academics, and 
consumer representatives. And, while visiting our district offices in 
Cincinnati and Miami, I met with a wide range of consumer groups, 
including groups representing the elderly, persons with HIV, and 
minority communities.
    I also am committed to fostering our co-operation with other 
federal and State agencies. In Philadelphia and Chicago, I met with 
local transportation officials and Customs representatives to tour 
shipping and airport cargo terminals that serve as major ports of entry 
for such products as fresh fruits and vegetables, and saw first-hand 
where and how FDA investigators and our State and federal partners 
examine incoming products. And I met with the heads of the Departments 
of Agriculture and Health of Ohio, Kentucky, and Florida to discuss our 
partnership with the States on many important issues, including 
mammography and food safety.
    I also have used my travels to the District Offices to meet with 
representatives from the academic community with whom I intend the 
Agency to form stronger alliances. I am particularly interested in 
harnessing the intellectual capabilities of the academic community and 
other science-based agencies. For example, on my trip to the Cincinnati 
District Office, I asked the Dean of the University of Cincinnati 
Medical School to tour our laboratory facilities with me. Exchange is a 
two way street--opportunities for health professionals, students, and 
faculty members alike exist and our facilities and likewise our 
scientists will benefit from access to the great educational research 
institutions in this country. I also visited Chicago's National Center 
for Food Safety and Technology (NCFST) at the Moffett campus, a major 
food safety research and education center established in 1987 by FDA 
and the Illinois Institute of Technology, with participation from the 
food industry and the University of Illinois. The NCFST, which is 
currently working on a wide range of projects relevant to FDA's food 
safety initiative, serves as an outstanding model of collaboration 
between industry, academia, and government.
    In my first five months, my focus also has been on an issue closer 
to home. I know that the Subcommittee is concerned about the size and 
structure of the Office of the Commissioner. I have undertaken a formal 
review of the Office with the goal of creating a more streamlined, 
efficient office that will provide leadership without compromising 
programmatic functions. I can assure the Subcommittee that I will keep 
you informed as I make decisions about specific changes in the Office 
of the Commissioner.
    That is a thumbnail sketch of the last five months. Today, the 
Administration is asking for a substantial increase in FDA's budget, 
indeed, the largest requested increase in the Agency's history. This 
budget request is intended to allow us to begin to rebuild our 
capabilities, to strengthen our science base, the foundation of sound 
regulatory decisions, and to continue several long-range, high priority 
programs that are vital for the protection of the public health. As 
large as this budget request is, it provides only the first steps 
toward rebuilding an effective Agency able to carry out its basic 
responsibilities and to respond to emerging public health problems.
                               priorities
Implementation of FDAMA
    I will now discuss the substantive issues that I intend to make 
priorities during my term as Commissioner. First, and most important to 
me, is the implementation of FDAMA. The passage of FDAMA was the 
culmination of several years of work by Members and staff from both the 
House and the Senate and from both sides of the aisle. The Act's final 
text represented countless hours of negotiation involving Congressional 
staff, the Administration, the regulated industry, and representatives 
from consumer, patient, and health professional organizations. The 
result of this process was sweeping legislation that touches on nearly 
every facet of the Agency's mission and thus impacts nearly every 
citizen in the country.
    Let me emphasize, as I did in my confirmation testimony, that I am 
committed to the full and effective implementation of FDAMA--both the 
letter and spirit of the law. I embrace the principle that the best 
organizations find ways to constantly improve themselves. Such 
organizations re-examine their processes, tasks, and goals, and use 
their daily experiences to refine their efforts in approaching the next 
task. FDAMA provides the Agency with valuable opportunities to conduct 
such a re-examination and challenges us to change. Making continual 
changes based on past performance with an eye on the goal of 
improvement is essential to FDA's effectiveness. As someone once said, 
``Every time history repeats itself, the price goes up.'' While FDA has 
many great traditions, it can never afford to stop evolving in response 
to the diverse and changing needs of those it serves.
    Recognizing the priority the Congress gave to enactment of FDAMA, 
FDA in turn has devoted unprecedented resources to implementing the new 
statute within the time frames set forth in the Act. As you know, the 
passage of FDAMA imposed a daunting array of challenges on the Agency. 
FDAMA explicitly required that the Agency complete over 60 regulations, 
guidance documents, notices, reports, and other tasks, including 
studies or lists. Many of the statutory requirements had specific 
deadlines for completion. In addition, in order to have full and proper 
implementation that was consistent with the letter and spirit of the 
law, FDA needed to make numerous conforming changes to existing 
regulations, and to issue guidance to clarify new provisions. The 
Agency has already completed over 80 FDAMA-related actions. In 
completing this impressive amount of work, the Agency met nearly all of 
its statutory deadlines--while continuing to perform all of the other 
important tasks that the American people have come to expect.
    These implementation tasks were not simply numerous, but important. 
The Act addresses everything from the evidentiary standard for devices 
to the review process for health claims on food. Some of these 
provisions clarify longstanding Agency practices or procedures, others 
codify important practices to assure their full and consistent 
application, and still others establish important new programs for the 
Agency to administer.
    Some of the high profile initiatives completed within this past 
year include:
  --Guidance to industry on the streamlined development and approval 
        process for new therapies for serious and life-threatening 
        conditions;
  --Publication of a final rule on the information that manufacturers 
        can offer about the uses of medicines that are not approved.
  --Implementation of a process to obtain financial incentives for 
        conducting studies on the use of drugs in children;
  --Development of exemptions from pre-market notification for certain 
        low-risk medical devices;
  --Clarification of the procedures for administrative appeals of 
        decisions made by the Agency; and
  --Guidance to industry on ``health claims'' that can be made for 
        foods based on authoritative statements from scientific bodies.
    Aside from the completion of the tasks listed above, the Agency has 
worked to ensure that those affected by FDAMA, both inside and outside 
the Agency, have received appropriate information about the new law. 
FDA has held internal training sessions, as well as a series of public 
meetings to discuss specific provisions in the law. We also have 
received many suggestions from our stakeholders on implementation.
    As I mentioned earlier, section 406(b) of FDAMA required FDA to 
consult with our stakeholders prior to submitting the Agency's plan for 
statutory compliance with the Act to Congress last November. In order 
to comply with this requirement, FDA reached out to the general public 
and to those segments of society most directly affected by FDA to 
solicit their views on how the Agency can best meet its public health 
mission. FDA held eight public meetings to hear the views of our 
stakeholders on how we could do our job better. The Agency heard from 
more than 75 different speakers at meetings attended by more than 600 
people.
    We heard several consistent messages from those who participated, 
including the following:
  --FDA should assure that its processes are equitable, open, and 
        transparent;
  --FDA should collaborate with other government agencies, academia, 
        and international organizations to better coordinate the 
        protection of the public health; and
  --FDA should be commended for reengineering its processes to make 
        them even more efficient and effective, and should continue 
        these activities, as well as efforts to reduce the burdens of 
        complying with regulatory procedures.
    This is good advice. But, to paraphrase La Rochefoucauld, it is not 
enough to receive good advice; we must also have the wisdom to profit 
from it. In this case, the Agency not only listened carefully to the 
advice it received, but took that advice seriously in developing a 
realistic plan for complying with our statutory obligations. The 
completed plan was published in the Federal Register last November.
    I would like to highlight briefly one of the statutory obligations 
that we have not been successful in meeting, however, and that we are 
unlikely to be able to meet without additional resources. The statute 
requires FDA to conduct inspections every two years of establishments 
that make prescription drugs and higher risk medical devices. FDA's 
ability to conduct these inspections has fallen considerably over the 
past few years, even as consumer expectations concerning the safety of 
the products they use continues to rise. As a result of the healthy 
economy, many new businesses have been formed in the past five years, 
increasing dramatically the number of establishments to be inspected. 
Between 1990 and 1998, the number of firms to be inspected rose from 
89,000 to 114,000, an increase of 26 percent. To raise the frequency of 
inspections of all product areas, and to improve the quality of FDA's 
laboratory capabilities, bringing FDA closer to conformance with its 
statutory obligations, the Administration is requesting $52.2 million.
    FDAMA also included the reauthorization of the Prescription Drug 
User Fee Act of 1992 (PDUFA). PDUFA is among the most successful Agency 
programs in history. Within its first five years of implementation, the 
increased resources provided by PDUFA to hire additional review staff 
has resulted in cutting the average review times for new drugs in half, 
without compromising the high standard that FDA has traditionally 
applied in weighing the risks and benefits of drugs and thereby in 
determining their safety and effectiveness. PDUFA is widely regarded by 
Congress, industry and patient groups as an example of how to achieve 
success through funding increases tied to ambitious performance goals. 
I will work to make sure that the Agency continues this performance 
under PDUFA for the next five years.
    I would like to take a moment to update you on the improvements 
made in product review times in fiscal year 1998. The Center for Drug 
Evaluation and Research (CDER) increased the speed of its review in all 
user fee drug categories. The median total time to approval for new 
original drugs was 12 months, compared with 14.4 months in 1997. For 
priority drugs, that is, those drugs considered to be of potentially 
exceptional public health value, the median approval time was 6.4 
months. Several important drugs were approved in 6 months or less, 
including efavirenz for treatment of HIV and AIDS (just over 3 months), 
and fomivirsen for treatment of CMV retinitis (4\1/2\ months).
    Approval times also decreased for the most important categories of 
biological products. For products containing a substance or combination 
of substances never before approved for the U.S. market, the median 
approval time dropped from 12 months in 1997 to 11.5 months in 1998. 
Moreover, the median approval time for priority products dropped to 6.9 
months, from 8.9 months in 1997. Among the important new products 
approved under the new Fast Track program were Trastuzumab, a new 
breast cancer therapy, and Etanercept, a new treatment for severe 
rheumatoid arthritis. These two therapies are also among a growing 
number of bioengineered products that are approved each year, 
demonstrating how the investment in biotechnology is fulfilling its 
promise.
    Although FDA product review times in programs benefitting from user 
fee expenditures have shown dramatic improvements, other categories of 
product reviews for which we do not receive user fees have seen some 
improvement, but continue to suffer from unacceptably long review 
times. Programs for which we do not receive user fees include blood and 
blood components, animal drugs, generic drugs, medical devices, and 
food additives. Section 406(b) of FDAMA directs the Agency to find ways 
to meet the statutory deadlines for review of all product categories. 
While we will continue to undertake management initiatives to attempt 
to meet these deadlines, we believe that prospects for significant 
improvement in review times for these product areas are dim without 
additional resources, especially as technology yields more complex 
products, developed at a much faster pace. The Administration is 
therefore asking for $28 million in both new appropriated funds and new 
additive user fees to improve review times in areas of particular 
concern: food additive petition reviews, food contact substance 
reviews, and medical device reviews.
    The increases in the speed of review for products covered by PDUFA, 
of which FDA is justifiably proud, raise an important question. In the 
quest for more rapid reviews, has the Agency compromised the standards 
that govern the approval of new products? The answer is no. FDA has a 
critical obligation to the American public to ensure not only that 
life-saving drugs and devices are available in a timely way but that 
they are safe and effective. Several well-publicized market withdrawals 
of new prescription drugs in 1997 and 1998 have led some people to 
conclude that faster drug reviews are resulting in the approval of 
unsafe products. The products in question were two diet drugs, 
dexfenfluramine and fenfluramine (the ``fen'' component of ``fen-
phen,'' a combination fenfluramine and phentermine that was widely used 
off-label), terfenadine (Seldane) for treatment of allergies, 
mibefradil (Posicor) for treatment of hypertension and chronic stable 
angina, and bromfenac (Duract), a painkiller.
    Let me assure you that the agency has carefully reviewed these 
withdrawals with this question in mind, and has concluded that there is 
no relationship between the speed of approval of these products and the 
reasons for their withdrawal. Some of these drugs were approved years 
ago: fenfluramine in 1973, and terfenadine in 1986. Moreover, FDA's 
review shows that, since the advent of PDUFA and more rapid review 
times, the percentage of drugs withdrawn from the market has actually 
decreased. One important finding of FDA's review of the product 
withdrawals was that drug approvals are necessarily made on the basis 
of limited information about a few thousand patients given the drug 
during clinical trials. Inevitably, a more complete picture of a drug's 
toxicity is developed as a drug is administered to a much larger group 
of patients after it reaches the market. For this reason, Injury 
Reporting is an increasingly crucial component of drug safety 
assurance, especially with respect to relatively rare or unpredictable 
problems that may not have evidenced themselves completely in the 
initial more limited and more rigorous setting of the clinical trials. 
The importance of Injury Reporting is also great for products, like 
foods and dietary supplements, for which there is no premarket review. 
Although product-related injuries are a significant cause of injury and 
death in the U.S., no integrated system for the reporting, monitoring, 
and evaluation of all FDA regulated product-related injuries currently 
exists. Therefore, to reduce the incidence of deaths and disability 
resulting from injuries with FDA-regulated products, the Administration 
is requesting a total of $15.3 million to begin critically needed 
improvements to FDA's Injury Reporting system.
    This initial investment will begin to build the foundation for a 
modern, integrated system for spontaneous reports. Spontaneous 
reporting systems are used to find rare or unexpected types of 
injuries. Additional investments will be needed in subsequent years to 
make a comprehensive system a reality. To gain a better understanding 
of the whole range of injuries from FDA-regulated products, active 
surveillance systems based in large health care systems will be needed. 
The Agency is not requesting the resources required to develop active 
surveillance systems adequate to study the epidemiology of all product-
related injuries, but plans in the future to build a more comprehensive 
system upon the groundwork provided by this budget. Funds for limited 
implementation of a sentinel site program for medical devices are also 
included in the budget request.
    As I have already stated, I believe that FDA has accumulated a very 
impressive record on implementing FDAMA, especially considering the 
ambitious timeframes that had to be met in the first year. You have my 
assurance that these efforts will continue as we fully implement of 
FDAMA.
Strengthening the Agency's Science Base
    My second priority is to strengthen the science base of the Agency. 
Sound scientific principles must underpin our decisionmaking and guide 
the critical policy decisions that we make. FDA's investigators must 
have adequate scientific training to make good decisions in the field. 
Our product review teams sit in judgment of applications resulting from 
work done by the nation's leading scientists and the review teams must 
apply sound, often cutting-edge science to product reviews. This is an 
urgent issue. The increasing investments made in both basic and applied 
research by the National Institutes of Health and the pharmaceutical, 
biotech and medical device industries will inevitably result in a 
burgeoning growth of new products that must be reviewed by FDA before 
they come to the marketplace. FDA must have the scientific 
sophistication necessary to understand and adequately evaluate these 
products. I am committed to seeing that our scientific expertise 
matches the complexity of the new products moving toward the market, 
for our decisions will be only as strong as our expertise.
    There is a compelling need for an adequate scientific foundation in 
almost all of FDA's activities and for a strong, scientifically-skilled 
workforce. First and foremost FDA is a science-based regulatory agency. 
It is therefore critical that we invest wisely in those that we recruit 
for these tasks. It is also imperative that we have mechanisms and 
resources available to see that we maintain a presence in the world of 
science. We can ill afford to have our staff become stagnant, for if 
this were to occur, our decisions would become inappropriately risk-
averse--or worse--wrong. We will need to pay particular attention to 
improving our recruitment and retention of our best scientists and to 
leveraging the intellectual power of other science-based governmental 
agencies and academia.
    The results of a strong science base can have wide-ranging benefits 
for the public health. Let me offer a few experiences that illustrate 
the importance of ensuring that FDA's scientific capabilities are of 
the highest order.
    In several cases, scientists at FDA's Center for Devices and 
Radiological Health (CDRH) have been able to pinpoint the cause of 
reported injuries from medical devices, and in at least one instance, 
help correct a product defect, when even the manufacturers were unable 
to do so. In the first case, when new small bore catheters were used to 
administer continuous spinal anesthetics, patients began to suffer 
nerve damage and even paralysis. The cause of these injuries was 
unknown until FDA scientists discovered the source of the problem 
through laboratory testing and analysis: the slow flow rate through the 
small bore catheters decreased mixing of anesthetic with spinal fluid, 
causing nerves to be bathed in nerve-damaging concentrations of 
anesthetics.
    In the second case, a new device used to close holes in the heart 
by means of a spring-loaded umbrella inserted into the heart by a 
catheter began to cause severe complications when used in children. 
Several children required emergency surgery after developing tears in 
the structure of their hearts. FDA scientists were able to identify the 
role of the device in these complications, and helped the manufacturer 
to redesign a safer device by changing the shape of the springs used to 
open the umbrella.
    In the third case, FDA had been receiving reports of sporadic 
implantable cardiodefibrillator and pacemaker failures resulting in 
hundreds of problems and three deaths. No one understood the pattern of 
the failures in these devices until FDA scientists identified a common 
cause: helium was leaking from the body of the pacemaker into the 
electronic clock, destroying the vacuum in the clock's timing crystal. 
The damage to the clock in turn caused the pacemaker to fail.
    Well-qualified and trained scientists can also identify dangerous 
products even before they reach the market. Scientists in the Center 
for Drug Evaluation and Research were able to prevent a potentially 
dangerous drug from entering the U.S. market, because they recognized 
that seemingly innocuous laboratory results signaled a high likelihood 
that the drug would cause serious liver injury. A new drug application 
(NDA) was submitted for Dilevalol, a drug in the usually safe class of 
blood pressure drugs known as beta blockers. FDA scientists saw that 
the drug had caused several cases of increased liver enzymes associated 
with modestly elevated bilirubin. Although these effects were not in 
and of themselves harmful, the scientists knew from their training and 
experience that such effects predict serious liver injury, which had 
not been recognized by the drug's manufacturer. When the manufacturer 
reviewed the post-marketing experience with the drug in Portugal, 
serious injuries were in fact found, and the drug was withdrawn 
worldwide.
    Highly trained scientists at CBER familiar with, and able to 
improve upon, the latest test methods, also were able to avert the 
withdrawal of an important childhood vaccine by demonstrating that an 
apparent threat to the safety of the vaccine did not in fact exist. In 
the summer of 1995, scientists at the Swiss National Center for 
Retroviruses, using a new and highly sensitive assay, detected the 
presence of retroviruses in the vaccine for mumps, measles, and rubella 
(MMR). Because retroviruses can be highly infectious, the Swiss 
government informed the World Health Organization that it was 
considering withdrawing the MMR vaccine. This proposed action required 
FDA to consider whether to withdraw the MMR vaccine from the American 
market. CBER scientists quickly undertook research which showed that 
the assay used by the Swiss had detected a form of retrovirus which was 
not infectious, thus establishing that the vaccine did not pose a risk 
of infection to children. In addition, our scientists have been able to 
modify the assay to make it more precise in its ability to discriminate 
between true infectious retroviruses and normal cellular enzymatic 
activity in a vaccine.
    This example also illustrates the global nature of the public 
health issues that FDA must address and underscores the importance of 
working with our international partners, including the World Health 
Organization, to ensure that global standards for marketing new 
products and for addressing emerging infectious diseases are as high as 
possible.
    Other significant scientific contributions that FDA is often alone 
in providing, and that must be supported and strengthened, include:
  --development of rapid and sensitive methods to analyze foods for 
        microbial contaminants;
  --swift identification of pathogens in the food supply by our field 
        laboratories, preventing widespread illness;
  --development of methods to ensure identity, purity, and potency of 
        vaccines;
  --examination of adverse interactions between drugs that may be 
        prescribed at the same time,
  --evaluation of degradation and molecular changes in implantable 
        device materials;
  --development of risk assessment and risk management models, and
  --development of test systems to improve the review of new products 
        for safety and efficacy.
    These examples underscore our need to support the scientific skills 
of those entrusted with carrying out FDA's many responsibilities. We 
must invest in maintaining and enhancing those skills to ensure that 
our decisions and actions continue to be grounded in the best science 
and continue to command respect in this country and around the world. 
Indeed, we cannot afford to do otherwise.
Food Safety
    Another area that I have identified as a high priority is the 
safety of our food supply. Last month, I appeared before this 
subcommittee to address that portion of our budget. At that hearing, 
members of the subcommittee raised several issues to which I would like 
to respond briefly today.
    The subcommittee questioned the success of our Hazard Analysis and 
Critical Control Point (HACCP) system for seafood. We believe that this 
program has been a great success despite the fact that some problems 
were identified for a majority of the seafood firms in the first year 
of implementation. Only 4\1/2\ percent of those inspections were 
serious enough to require official action. The seafood industry is a 
uniquely complex one, consisting of more than 4,000 domestic seafood 
producers--mostly small businesses--processing more than 300 varieties 
of seafood from numerous different habitats. Consequently, instant 
compliance was never expected. Rather, gradual and steady progress was 
the goal. In this respect, the program is on track:
  --FDA dramatically increased its inspection frequency of the seafood 
        industry to at least once a year to provide steady, consistent 
        feedback to industry regarding HACCP.
  --FDA created a seafood HACCP guidance document for the industry that 
        essentially contains all the agency's knowledge on hazards and 
        controls. This document is being adopted by other countries.
  --FDA has focused on educating firms to understand how to identify 
        and fix problems in order to accomplish a fundamental cultural 
        change in the industry.
  --The HACCP program has served as a catalyst for the formation of the 
        Seafood HACCP Alliance, a consortium of Federal and State 
        agencies, academia, and industry, to develop low cost training 
        for industry in basic hazards and controls.
    The subcommittee also questioned our actions in the area of produce 
safety. FDA believes the steps we have taken in this area have 
successfully helped to prevent foodborne illness. As with seafood, 
improving the safety of produce is extremely complex. The agency must 
consider the differing cultivation, harvesting, packaging, and shipping 
practices for a wide variety of fruits and vegetables with differing 
physiological characteristics to determine what preventative 
interventions are appropriate. Unfortunately, our scientific knowledge 
in this area is limited. While we are using our food safety dollars to 
increase research in this area, we believe that educational activities 
will be most productive in preventing foodborne illness at this time.
    The agency has taken numerous steps toward our goal of minimizing 
foodborne illness associated with fresh produce:
  --FDA has developed a guidance document on Good Agricultural 
        Practices and Good Manufacturing Practices to minimize 
        microbial hazards in fresh fruits and vegetables. This document 
        is in the process of being adopted by the CODEX Food Hygiene 
        Committee as the international standard for produce production.
  --FDA has initiated educational programs on production and processing 
        for domestic and international producers.
  --FDA and USDA have jointly undertaken an ambitious research program 
        for both post- and pre-harvest production of produce.
  --FDA and USDA have jointly undertaken a survey of the agricultural 
        community to better understand current agricultural practices 
        in order to determine how to maximize public health impact 
        while minimizing economic impact on the agricultural community.
    We have come before this committee for three years in a row asking 
for additional funding to protect the public from foodborne illness. 
While the diversity of products we regulate make our job a difficult 
one, we believe that we have done the best job possible in improving 
the safety of the food supply. With the additional funding we have 
requested for fiscal year 2000, we will be able to move that much 
closer to our goal of putting a strong, science-based food safety 
system in place that maximizes public health.
Blood Safety
    Each year more than 3\1/2\ million Americans receive blood from 
volunteer donors. While blood and blood-derivatives can be life-saving, 
blood products can pose risks to patients. Among the most serious of 
these risks is the possibility of transmission of undetected infectious 
diseases. At the same time, shortages of blood can be life-threatening. 
The safety and adequacy of the blood supply and blood products is one 
of the highest priorities of the FDA and the Department of Health and 
Human Services, and is one of my priorities as well.
    FDA already has taken many steps to address this issue. The Agency 
has developed a Blood Action Plan to increase the effectiveness of our 
scientific and regulatory actions and to ensure greater coordination 
with our PHS partners. The Action Plan addresses such issues as (1) 
evaluation, scientific investigation, and management of emerging 
infections that may pose a threat to the blood supply, (2) reinventing 
blood regulations with the goal of simplifying paperwork and moving to 
a standards-based approach to blood safety, and (3) the ability to 
notify product users in the event of recalls or other situations in 
which particular blood products may pose a risk to patients.
    FDA also has significantly increased its oversight of the blood 
industry. The Agency now inspects all blood facilities at least every 
two years, and problem facilities are inspected more often. FDA also 
provides the industry with detailed and updated guidance on how to 
ensure blood safety, and holds regular workshops for the blood 
industry, the academic community, and health care providers.
    Several key issues in blood safety still must be addressed. The 
technology associated with disease detection in blood donors is 
continually improving, but risks to those who receive donated blood and 
blood products remain. For a number of serious and life-threatening 
infections, including HIV infection, there is a limited period after a 
would-be blood donor has been infected in which the infection is not 
detectable by available methods. Blood donated during this period can 
transmit infection. We must therefore find ways to further reduce the 
window period during which infection with HIV and Hepatitis A, B, and C 
is undetectable. We also must reduce the risk to patients from 
bacterial contamination of blood and from blood bank errors.
    One of the greatest threats to the blood supply is posed by unknown 
or emerging agents that are not inactivated or removed during 
processing. This is an ever-present threat because new infectious 
agents that may endanger the blood supply may emerge at any time. FDA 
must have a strategy for managing, and the resources to address, each 
new infectious agent as it is identified.
    Finally, the Agency and the industry must find ways to manage blood 
and blood product shortages. Many shortages arise when FDA discovers 
violations of quality control procedures or other hazards that result 
in manufacturing plant closures or require the removal of products from 
the marketplace. The goal of ensuring safe blood and blood products 
thus competes with the goal of providing an adequate supply of blood 
and blood products, and achieving an appropriate balance is a constant 
challenge. The Administration is requesting $6.2 million for FDA's 
blood safety initiative, as part of the overall increase of $52.2 
million requested for product safety assurance.
Tobacco
    The Administration recently has renewed its commitment to reducing 
young people's use of tobacco products. Every year over 400,000 
Americans die from tobacco-related illnesses, almost all of whom began 
use of tobacco as children. A program that successfully keeps tobacco 
from children has the potential for unprecedented improvements in 
public health. FDA's budget request includes an increase in funding for 
its tobacco program to assure progress in all states towards the 
President's goal.
    The first two provisions of FDA's tobacco rule, a federal minimum 
age of purchase and a requirement that retailers check photo 
identification, went into effect in 1997. In fiscal year 1997, the FDA 
initiated a $4.9 million pilot enforcement program in 10 states, 
contracting with state and local governments to conduct compliance 
checks of retail outlets that sell tobacco.
    In fiscal year 1998, with a new $34 million appropriation for the 
tobacco program, FDA built upon the success of the pilot program and 
expanded its enforcement and outreach programs to 41 states, plus the 
District of Columbia and the Virgin Islands. By fiscal year 2000, the 
Agency plans to contract with or have an enforcement presence in all 50 
states and most territories.
    The preliminary results from our enforcement and outreach efforts 
are encouraging. In fiscal year 1998, FDA's State partners conducted 
over 39,000 compliance checks, including reinspection of those 
retailers found to have violated the rule. FDA expects to conduct 
approximately 189,000 compliance checks during fiscal year 1999, as new 
states begin enforcement efforts. The preliminary violation rate from 
over 69,000 checks conducted through March has been approximately 25 
percent, ranging from a low of approximately 11 percent to a high of 43 
percent. States with low violation rates typically have had their own 
very active enforcement efforts in addition to FDA activity. We 
anticipate that these rates will vary widely as more states begin 
conducting compliance checks for the Agency. Also in fiscal year 1998, 
FDA began seeking civil money penalties from those retailers found to 
have sold tobacco to minors at least twice.
    To assist its enforcement efforts, the Agency launched a multi-
media advertising campaign, including radio, print, and billboard 
advertising. A free retailer kit using humorous illustrations and a 
folksy approach was created to make it easier for retailers to comply 
with the new regulations. The campaign reminds retailers and clerks to 
check young people's photo identification and tries to defuse some 
customers' resentment towards the new rules and urges them to cooperate 
with retailers.
    Litigation concerning FDA's assertion of jurisdiction over tobacco 
continues in federal court. Following the District Court's 1997 
decision upholding FDA's assertion of jurisdiction and the access 
provisions of the regulations, the Fourth Circuit issued a decision in 
1998 finding both FDA's assertion of jurisdiction and issuance of 
regulations invalid. January 19, 1999, the government filed a petition 
for a writ of certiorari with the Supreme Court. Under the rules of the 
Fourth Circuit and the Supreme Court, the age and ID provisions of the 
rule continue in effect, pending Supreme Court review.
    For fiscal year 2000, the Administration is seeking a $34 million 
increase in the tobacco program. With this increased funding, the 
Agency plans to inspect an increased number of retail outlets that sell 
tobacco and will intensify its efforts in certain targeted-
demonstration areas. Outreach efforts are planned to be expanded to 
include the creation of new billboard material, print, radio and in-
store advertising and the expansion into two new and important media--
television and news weeklies.
Bioterrorism
    In an era of global instability, there is growing concern about the 
possible deployment of biological and chemical agents by certain third 
world countries. FDA has been called upon by the President to help 
respond to the threat of bioterrorism. The Agency is in a unique 
position to assist in this effort by reviewing products that may be 
used to treat illnesses caused by biological and chemical agents, as 
well as to assist in the rapid development of diagnostic tools and 
treatments for disease outbreaks that could be caused by such weapons. 
In fiscal year 2000, FDA is requesting a total of $13.4 million for 
this Presidential initiative as part of the Public Health and Social 
Services Emergency Fund. Additionally, in fiscal year 1999, there is a 
supplemental request to provide FDA $3.3 million in funding to engage 
in anti-bioterrorism activities. While this request is not before you, 
it is very important to us.
                               the budget
    The President's budget includes an increase of $95.5 million for 
injury reporting, product safety assurance, and application review 
activities, many of which respond to goals laid out in FDAMA. At the 
same time, because of the absorption of pay raise and other 
inflationary costs for the past several years, FDA has had to reduce 
its staffing substantially, and the increases requested will enable us 
to sustain our core public health responsibilities and to add staffing 
in key areas where FDA's science base must be strengthened.
    This $95.5 million increase includes a request for $20 million for 
design and for the first phase of construction of a new District Office 
and Laboratory in Irvine, California. This facility not only will 
enable us to bring our Los Angeles laboratories up to date, it will 
eliminate severe security problems at our present Los Angeles office.
    In addition, we are requesting increases totaling $77 million for 
the Presidential initiatives on food safety, tobacco, and countering 
bioterrorism.
    Our total request for fiscal year 2000 is for total spending 
authority of $1.35 billion, of which $1.16 billion is for budget 
authority, with the remaining $196 million derived from user fees and 
other sources. I would like to emphasize that the only new user fees we 
are proposing, $17 million for the review of new medical devices, food 
additives, and food contact substances, would expand our programs in 
these areas, rather than fund current activities. As we know from our 
past experience with PDUFA, user fees work best when several principles 
are adhered to: 1) Consensus of need by the Congress, industry, and 
Administration, 2) The fees are applied to the timely review of 
products, and 3) Aggressive but realistic performance goals are set. 
The legislation to authorize these fees will be submitted shortly by 
the Administration to the Congress. I also would note that there is a 
proposed increase of $13.1 million for PDUFA activities under our 
current five-year plan for continued improvement in the review of new 
drugs. Lastly, we are requesting $3 million in transition costs and 
projecting $12.7 million in user fees for the voluntary seafood 
inspection program currently operated by the Department of Commerce. 
This program is proposed to be transferred to FDA in fiscal year 2000. 
A legislative proposal will be submitted to make this a Performance 
Based Organization under the Vice President's program for reinventing 
government.
    I am also pleased to be able to report to you that there is $56 
million in the General Services Administration's fiscal year 2000 
budget request for design and initial construction of new consolidated 
laboratories for FDA at the former Naval facility in White Oak, 
Maryland. While facilities are now under construction at College Park, 
Maryland, for our headquarters Foods program, FDA's other headquarters 
laboratory programs are widely dispersed and in need of state-of-the-
art facilities. The initial phase of construction at White Oak will 
provide new laboratories and animal holding space for several of our 
human drug laboratories. As additional facilities are constructed in 
future years, more of our scientists will be able to utilize the most 
up-to-date laboratory technology, and will be able to work together, 
permitting the most productive use of the Agency's scientific 
resources. Coordination among all of FDA's headquarters programs will 
be improved, as will operational efficiency.
                               conclusion
    I want to thank you for the opportunity to testify before you 
today. It is often said, Mr. Chairman, that FDA is America's most 
important consumer protection agency, because it regulates a quarter of 
all consumer spending. The products that comprise that trillion dollars 
in annual sales are ones we rely on every day--over-the-counter and 
prescription drugs, contact lenses, microwave ovens, most of the food 
we eat--the list goes on and on. Americans have high expectations for 
the safety and reliability of these goods. The industries that make 
these products and the scientific advances that fuel their innovations 
are vigorous and growing. FDA needs the resources and scientific 
expertise to keep up with that growth, or both consumers and industry 
will suffer.
    FDA is an Agency that has prided itself on being a can do agency. 
But it is clear that the Agency can't do everything without additional 
resources. We must make sure we can capture and analyze and take 
appropriate action on the adverse events that occur each year from 
products we regulate. We must be able to inspect the companies that 
make those products as the Congress has directed us to do. And all 
important new products must get to the market as quickly as possible, 
consistent with our mandate to assure safety and effectiveness. The 
funds that we are asking you to appropriate in this budget will make 
great strides toward moving us toward these goals. I make a public 
commitment to you today that, if we are given these funds, we will 
spend them wisely and well.

                                TOBACCO

    Senator Cochran. Thank you very much, Dr. Henney. I had a 
group in my office the other day from Mississippi complaining 
about the FDA sting operations that are designed to enforce the 
rules against selling tobacco to teenagers.
    The point they were making to me was in our State of 
Mississippi, the attorney general has his own enforcement 
program which involves city and county law enforcement 
officials. They also have a training program.
    Mississippi is one of the states that filed one of the 
first suits, maybe the first suit or settled the first suit. So 
funds are available for trying to do a better job of curtailing 
teenage tobacco use.
    And then they tell me there is now an FDA sting operation 
or enforcement operation in Mississippi. The first fine is 
$250. Subsequent fines can go as high as $15,000. These are 
fines that are imposed on store owners, convenience stores, and 
service stations that sell gasoline and liquor.
    My question is it seems like we're spending a lot of money 
and this group is convinced this is a duplicative and wasteful 
use of federal funds when there is a state program.
    They also tell me the state enforcement officers promptly 
advise the store owner of any violation of the rules. The 
officer explains to the clerk who was involved what they did 
wrong, what they should have done, what the penalties are. If 
they do it again, they write a letter to the store owner.
    In the case of the FDA operations, they do not notify the 
store owners promptly. I am told sometimes it's months that go 
by or weeks before the store owner is advised that there has 
been a violation. Then the citation is received. There's an 
appeals process. They tell me that no one to their knowledge 
has had any successful appeal of an FDA citation.
    They don't see the point in having the feds down there as 
well as the state involving local enforcement officials.
    And so I'm passing this on because I asked them to put all 
of this in a letter to me so I would understand all of the 
complaints that have been submitted to this group. And I pass 
that on and ask for your comments.
    Dr. Henney. Senator Cochran,
    Mr. Chairman, I would appreciate hearing from the group 
directly and hope that you will also send along their letter to 
me so that we can get a full picture of the extent of their 
concerns.
    I think that there certainly are differences about the 
program. I think that I would be remiss if I did not mention 
that our work with the state coordinator in Mississippi 
together with the state attorney general has been one of the 
most positive relationships that we have had with states.
    We rely on state law enforcement officials through 
contracts with the state to carry out our compliance checks. 
But as we continue to improve our own program, I am most 
receptive to the kind of feedback you are receiving.
    With respect to the fines or penalties associated, I think 
it would be important for you and others to know that if the 
convenience store or 7-Eleven store does not meet our standard 
on the first review, they are simply given a warning. There is 
not a fine associated with that. It is only on subsequent times 
of noncompliance that the fine process starts kicking in.
    I think we do need some clarification around the specific 
issues and hopefully we can work together as we all try to 
solve, and get our arms around, this issue of teenage smoking.

            REORGANIZATION OF THE OFFICE OF THE COMMISSIONER

    Senator Cochran. I appreciate that very much. And I will 
pass on to you the specific information that I have received.
    I was interested in hearing your proposal to reorganize the 
Office of Commissioner with the goal of streamlining and making 
it more efficient.
    Have you completed the formal review to the extent that you 
can tell us some of the specific things that you have in mind 
about the current size and functions of the office?
    Dr. Henney. Mr. Chairman, I asked a group to undertake this 
study for me very early on as I came into the agency. I think 
that they worked very diligently conducting a number of 
interviews, analyzing functions, resources and the like and 
made recommendations to me.
    I announced to the staff of the FDA this week the extent of 
those reorganizations, the kind of programmatic endeavors that 
had been in the office of the commissioner that would now be 
transferred to the centers and other activities. We want to get 
more of the real resources down into the centers where they can 
be appropriately applied to our day-to-day and programmatic 
work.
    But I will be glad to provide you for the record a copy of 
the memo that fully outlines the changes and the extent of the 
changes involved.
    [The information follows:]
                  Memorandum From Jane E. Henney, M.D.
Date: April 22, 1999
From: Commissioner of Food & Drugs
Subject: Restructuring of the Office of the Commissioner
To: FDA Staff

    My first four months as FDA Commissioner have been interesting and 
challenging. I feel fortunate to have the opportunity to work with such 
dedicated and talented staff. I have thoroughly enjoyed being 
reacquainted with the people of FDA both here in the Washington area 
and in the field offices. I have learned a great deal about our 
innovative programs across the Agency in these last few months.
    At every opportunity I have reiterated my five priorities for my 
tenure as FDA Commissioner: full and complete implementation of the FDA 
Modernization Act of 1997; restoring and enhancing FDA's science base; 
and fund the Administration's initiatives of food safety, blood safety 
and tobacco.
    During my confirmation hearing in addition to stating my 
priorities, I also committed to reviewing the size and structure of the 
Office of the Commissioner (OC) with an overall goal of creating a more 
streamlined, efficient office that will provide leadership without 
compromising programmatic effectiveness. At my request, a four-person 
task force made up of staff from the Centers and from the Office of the 
Commissioner reviewed and analyzed the OC structure and functions as 
they currently exist and made recommendations to me for improvement. My 
specific goals were:
    To create an Office of the Commissioner for which the principal 
focus was to provide leadership in building effective, two-way 
communication between the Agency and all of our stakeholders including: 
patients, consumers, Congress, the Administration, Agency employees, 
the regulated industry, health care professionals, and other scientific 
advisors.
    To enable us to implement the Agency's priorities and to develop 
Agency policy with primary input from the Center Directors, the 
Associate Commissioner for Regulatory Affairs, and with legal advice 
from the Chief Counsel.
    To streamline the OC to make the overall Agency more effective and 
efficient with roles and responsibilities clearly delineated.
    To retain in OC only those staff functions which cannot be 
reasonably and more effectively performed in the Centers or the Office 
of Regulatory Affairs (ORA).
    Using the basic recommendations from the task force, the major 
changes that will occur with the reorganization are as follows: The 
Office of the Commissioner will return to using a single deputy 
managerial model. Dr. Michael Friedman will assume this important role. 
The Center Directors and the Associate Commissioner for Regulatory 
Affairs will report directly to the Commissioner.
    Within the immediate office of the Commissioner, a new position 
will be established, the Senior Associate Commissioner. I have asked 
Dr. Linda Suydam, currently the Associate Commissioner for Strategic 
Management, to assume this role. Her responsibilities will include 
coordinating all activities within the Office of the Commissioner, as 
well as directly supervising the following offices: Chief Mediator and 
Ombudsman staff, Office of the Executive Secretariat, Office of Public 
Affairs, Office of Orphan Products Development, the Internal Affairs 
staff, Advisory Committee Oversight, and the Office of Tobacco 
Programs.
    Several other functions within the Office of the Commissioner will 
be realigned. The former position of Deputy Commissioner for Policy 
will be converted to Senior Associate Commissioner for Legislation, 
Policy and Program Planning. I have asked Mr. William Hubbard to assume 
the duties of this position. He will oversee the functions of policy 
coordination, legislative affairs, and planning and evaluation.
    As a result of the growing importance of international policy and 
activities, Deputy Commissioner Sharon Smith Holston has been asked to 
lead the consolidation of all of these activities under a new Office of 
International and Constituent Relations. The Offices of Consumer 
Affairs, Women's Health and Special Health Issues will continue to 
report to Ms. Holston.
    The Office of Management and Systems will continue to be led by 
Deputy Commissioner Robert J. Byrd. This Office will be relatively 
unchanged in function except that many of the transactional functions 
of management will be decentralized to the Centers, and as previously 
mentioned, the Office of Planning and Evaluation will move to the 
policy grouping.
    Ms. Holston and Mr. Byrd will carry the title of Deputy 
Commissioner for International and Constitutent Relations and 
Management and Systems respectively. In keeping with my intention to 
move to a single deputy model; however, these titles will remain with 
the current incumbents as long as they are in these jobs and convert to 
Senior Associate Commissioner thereafter.
    The Office of Equal Employment and Civil Rights will report 
directly to the Commissioner with Ms. Rosamelia Lecea continuing as its 
Director. Ms. Lecea has been requested to reassess how her Office is 
leading the complaint management process and to assume the diversity 
program functions previously carried out in the immediate Office of the 
Commissioner.
    The Office of Chief Counsel led by Ms. Margaret Jane Porter will 
remain unchanged.
    The reorganization will specifically move some functions now 
residing in the Office of the Commissioner to the Centers or ORA. Other 
functions will remain in OC but will be regrouped. A limited number of 
functions will be abolished altogether, and I have requested that, in 
those few instances where functions are being abolished, a special 
Placement Committee be established to assist employees in locating 
suitable reassignments in one of the Centers or ORA.
    Please be assured that no employee will lose his or her job and 
that all employee rights will be protected, and every effort will be 
made to accommodate individual employees. I am also fully committed to 
working with those bargaining unit employees who are represented by the 
National Treasury Employees' Union (NTEU) and to fully comply with our 
collective bargaining requirements to assure that our specific 
obligations are met.
    I would like to take this opportunity to thank all FDA employees 
for your hard work and continued commitment to the public health, 
especially the employees in the Office of the Commissioner. Each of you 
works to make the programs of the Food and Drug Administration 
excellent. Your individual and collective contributions are pivotal to 
our success. I know that change is never easy, but I ask for your 
support as we implement this reorganization and work together in the 
days ahead.

    Senator Cochran. Thank you very much.

                              SCIENCE BASE

    We also understand from your statement your emphasis on the 
strengthening of the science base of FDA and your commitment to 
seeing that scientific expertise in the agency matches the 
complexity of the new products that are coming into the 
marketplace and the complexity of the marketplace itself.
    There are some interesting challenges that we know the 
agency faces. Would you please tell us what your specific goals 
are for improving the science base? How you plan to go about 
improving the recruitment and retention of the best scientists 
available to you?
    Dr. Henney. Mr. Chairman, the goal of maintaining and 
strengthening the science base is to make sure that the 
scientists that work at the agency or the expertise from 
outside that the agency draws on is always at the top of its 
game in terms of scientific credibility, scientific currency, 
scientific analysis and ability to review very complex issues 
that come into the agency.
    How to achieve that goal will take a number of initiatives 
on our part. Clearly there are issues around recruitment and 
retention and making sure that we have ongoing opportunities 
for continuing education, be they didactic or be they of a 
practical nature for our own scientists.
    Certainly they will involve how we better leverage the 
intellectual capital from across this country, be it in other 
federal agencies or be it in academia or even the regulated 
industry. And we are working together to develop a plan for how 
we achieve this.
    I think, as you might see, our budget next year will be a 
bit more transparent in terms of what we want to do ultimately 
in terms of this issue of strengthening the science base and 
that is how we are now constructing our discussions for next 
year's budget planning process.
    I would, also, say that in addition to having top-notch 
scientists, they need a top notched and first-rate facility to 
work in. And currently in the Washington, D.C., area we are 
spread around in many, many different facilities. It limits our 
capability and capacity for having strong comprehensive reviews 
because there is just the time delay, the geographic diversity 
has challenges all of its own.
    And so this year in GSA's budget, there is a proposal to 
finally develop the full plan for the consolidation of FDA's 
headquarters here in the Washington area and to build construct 
one building on that site, the first of multiple buildings that 
would come on line.
    I would hope that the Senate and the full Congress would 
look upon that request favorably because it will under-gird and 
strengthen our efforts to maintain a strong scientific base for 
the agency.

                              AQUACULTURE

    Senator Cochran. Thank you. I have other questions and I 
will submit most of them for you to respond to for the record.
    But let me point out one other parochial concern and that 
is in my state, we have a big new aquaculture industry and it 
requires drugs that are approved by FDA and other efforts to 
control disease.
    There has come to my attention the fact that aquaculture 
drug data packages recently submitted to the FDA Center for 
Veterinary Medicine are not being reviewed in a timely fashion.
    I'm told that the Center is more than six months behind in 
completing reviews of these submissions. I want to bring this 
to the attention of the agency leadership and ask that you look 
into it and try to ensure that a more timely review of 
aquaculture drug data submissions takes place, if possible.
    Dr. Henney. Mr. Chairman, I clearly don't know the 
specifics of the case but will be glad to look into it for you 
and get back to you promptly.
    [The information follows:]

    The situation that you asked about regarding an, aquaculture drug 
submission from Mississippi is an example of the pressures FDA must 
deal with as new industries emerge. In 1991, CVM developed a program to 
educate the aquaculture industry about the animal drug approval 
process. CVM hired a specialist in aquaculture who spoke frequently 
before industry groups in order to help there understand the steps 
necessary to get new aquaculture drugs approved, CVM also developed 
several written documents to provide guidance to the aquaculture 
industry. As a result, this aquaculture industry responded to the new 
challenge and developed numerous coalitions that generated a 
significant amount of new data necessary for drug approvals.
    The aquaculture drug development program created a burgeoning 
workload for CVM. At the same time, FDA faced reduced budgets and 
significant staffing shortages. In the face of staffing shortages, FDA 
has been unable to direct adequate resources to many critical areas, 
including aquaculture drug review, illustrating why FDA is asking for 
additional review resources for fiscal year 2000.

    Senator Cochran. Thank you. The Senator from Wisconsin.

                       COST OF PRESCRIPTION DRUGS

    Senator Kohl. Thank you, Mr. Chairman.
    Dr. Henney, people all across the country talk about the 
continuing rise in the cost of prescription drugs. In fact, I 
believe that it is more serious in this country than perhaps 
anywhere else in the world.
    I'd like to ask you what the FDA is doing about this 
problem and I would also like you to comment on the extent to 
which the long delays in the approval of generic drugs makes 
the problem more serious than it might be otherwise.
    Dr. Henney. Senator Kohl, I think the first and foremost 
responsibility of the agency to pharmaceutical development in 
this country is making sure that those products that do come to 
market are safe and effective.
    We have little control and have been given little 
responsibility for drug pricing or drug pricing issues. I think 
that our colleagues within the industry would speak to you 
about their own investments and trying to recoup that in terms 
of their research and development.
    But as we review products, we have little ability to look 
at issues related to drug costs except in the area which you 
raise and that is the review, the timely review of generic 
products.
    And while I think that I have alluded to, in my testimony, 
areas that have not benefited from the user fee program, some 
have longer review times than the areas that have benefited 
from user fees.
    Let me give you a flavor of the difference. Currently our 
average review time for prescription drugs is approximately 
twelve months. For generic drugs, it's approximately 18 months.
    But to get a flavor of how often reviews of generic drugs 
occur, there is nearly a new generic drug approved every single 
day. In fact, I think last year there was some 354 generic 
approvals given. So it is not as if generics are not coming to 
market. Could they be done in a more timely fashion with 
additional resources? The answer to that is probably yes.
    But I think that this particular group of people that work 
on generic drugs, have, through a series of management 
initiatives, really cut down review times in very significant 
ways in the past few years from a time in which these reviews 
took over 30 months to now taking 18.
    Is there a way to go? The answer is probably yes. Are there 
the resources in the program to review them within the same 
time as prescription drugs? Not quite yet.
    Senator Kohl. I thank you very much. I thank you, Mr. 
Chairman.
    Senator Cochran. The Senator from Illinois.

                       SINGLE USE MEDICAL DEVICES

    Senator Durbin. Thank you, Mr. Chairman. And thank you, Dr. 
Henney, for joining us today. I'm glad that you're head of the 
FDA. I recall working with you in years gone by and I've always 
respected the fact that you brought extraordinary expertise to 
the agency then and extraordinary leadership now. And I'm happy 
to have you here before us.
    I'd like to ask you about several specific areas of 
concern. One of them relates to an article which appeared in 
Forbes Magazine sometime earlier this year. I don't have the 
exact date on it. But it relates to single use medical devices.
    As it turns out, many medical devices used in hospitals 
today are purchased with the understanding that they are 
disposable or single use devices. In fact, they are being 
reprocessed and used over again without the knowledge of the 
patients in most instances.
    There has been a growing concern that these reprocessed 
disposable devices may be dangerous to the patients. There have 
been stories about tips of catheters breaking off and 
contamination of these devices when they're being reused.
    I notice that France has banned the use of disposable 
medical devices and other countries are starting to look at 
this more carefully. There is a competing interest here. The 
company that makes the devices would surely like to sell more 
and not see their devices reused to the detriment of their 
profit margin.
    And then, of course, hospitals are hoping to cut costs by 
using reprocessed disposable devices. I'm basically going to 
ask you from the consumer and patient's point of view, what do 
you think our policy should be and what is the FDA doing to 
address it?
    Dr. Henney. Senator Durbin, first of all, it is great to be 
back and to have the opportunity to work with you and all of 
the members.
    I appreciate your compliment on my expertise. But on the 
issue that you raise, I think I'm going to ask the real expert 
on this who is Dr. Jacobson, the current acting director for 
the Center on Devices.
    Dr. Jacobson. First of all, let me compliment you for 
asking a really tough question. This is one that we've been 
very concerned about as well. Up until now we've taken the 
approach that in the absence of data that there was a problem, 
we've been taking a conservative approach to what we should do 
because, as you said, there are a number of things to be 
considered here not the least of which is that the hospitals 
themselves are doing a lot of reprocessing. And we're not 
getting a lot of adverse reaction reports.
    All that being said, we are concerned about the safety of 
some of the higher risk devices. It used to be that only things 
like surgical instruments were reprocessed routinely. But now 
much more complicated devices are being reprocessed--devices 
that may pose a higher risk if they're not reprocessed 
carefully both from the materials aspects, that is can the 
materials stand up to the reprocessing, as well as from an 
infection control aspect. Are reused devices being adequately 
cleaned, disinfected, and sterilized prior to use?
    In May FDA is co-sponsoring a meeting on re-use with the 
American Association for the Advancement of Medical 
Instrumentation, and number of other co-sponsors. We are 
bringing together all of the experts we can find to sit down 
and talk about this issue. What needs to be done. What action 
should FDA be taking. We have really put a lot of work into it.
    Senator Durbin. Is there any requirement if a reprocessed 
disposable device is used that there be an entry in the medical 
record of the patient of that fact?
    Dr. Henney. Pardon me?
    Senator Durbin. If a hospital decides to reprocess a single 
use device, a catheter for example, and use it in the treatment 
of a patient, are they required to put in the medical record of 
that patient that they used a reprocessed catheter?
    Dr. Henney. Senator Durbin, I do not believe that they are 
required to do that.
    Senator Durbin. Would it not be difficult to really track 
the incidents or problems without that information?
    Dr. Jacobson. Yes. That is one of the issues.
    Senator Durbin. I'm glad to hear that you're addressing it 
and it's something of concern, I'm sure, not only to me but to 
anyone, if you go in the hospital to know whether or not you're 
receiving the best treatment with the best possible medical 
devices.
    Thank you, Dr. Jacobson.

                          OFF-LABEL PROMOTIONS

    Let me ask you about off-label promotions. This is 
something that has come up over the years where people have 
said that drugs originally approved for specific use turn out 
to have value in other applications. Many drug companies cannot 
justify in their own minds going through the process, again, 
for those off-label applications. Doctors know that they have 
some value. And the question remains as to whether or not these 
off-label applications are being sufficiently monitored to 
protect consumers and patients.
    I'd like to ask how much the review of off-label promotions 
is presently costing the FDA and whether or not the company is 
benefiting from these off-label promotions should share in the 
agency's cost of reviewing their promotional literature.
    Dr. Henney. Senator Durbin, the issue of off-label use was 
addressed, in part, in the FDA Modernization Act which tried to 
strike a balance between providing non-misleading information 
and the tension that had always been there for the real life 
situation of drug promotion. At the time of review of a drug 
and the appropriate labeling of that drug, what is considered 
is what is in the application; what population was this drug or 
product studied on; and that defines what's on the label.
    As the drug moves into the marketplace and further study of 
the drug is done or further trials of how the drug is used for 
other purposes, physicians have found other uses far beyond the 
labeled indications.
    Oftentimes these are written up in the medical literature 
and now through the Modernization Act, those kinds of materials 
can be appropriately provided to other physicians.
    The caveat also in the Modernization Act is that within a 
reasonable period of time--I believe the time period is some 
two to three years--the company must come in with data so that 
the agency is in a position to analyze that off-label use as to 
whether it can now go on the label. So that is part of the 
solution to the question you pose.
    I think that we still have concern, in part, at times when 
off-label use has created real safety issues. Probably the most 
recent episode of that where it led to the agency having to 
recall product and remove product from market was the case of 
the diet drug combination Phen/Fen.
    Those were drugs that were used together in a way never 
provided for on the label. It was clearly an off-label use and 
the result of that meant an absolute removal of the products 
from the market.
    Senator Durbin. What I'd like to zero in on is that safety 
is paramount. There's nothing more important. I'm trying to get 
down to the bottom line of the resources of the FDA to deal 
with it.
    If a drug company is coming in for approval of a new drug 
and they, of course, want to sell it for on-label applications 
and indications, then it's my understanding that they defray 
some of the costs of the FDA in reviewing that drug. But when 
it comes to the off-label application, it's my understanding 
that the FDA bears the full brunt of the cost. Is that correct?
    Dr. Henney. Senator Durbin, no, I do not believe that is 
correct because the proposal would come in as a supplement. And 
those supplements are covered under the user fee program if 
we're talking about a prescription drug. So we would receive 
resources in order to conduct the review of that supplement.
    Senator Durbin. How about the promotions, the money to 
review off-label promotions. Do you receive any compensation 
from the drug companies for that purpose?
    Dr. Henney. Senator Durbin, no, we do not.
    Senator Durbin. Do you know what that costs the FDA to do?
    Dr. Henney. I would be more than glad to provide you that 
for the record. And we could provide you what we do in terms of 
promotion in general and any monitoring we've done of the off-
label area.
    [The information follows:]

    FDA does not have positions devoted solely to the review of off-
label promotions. The specific cost to the FDA of reviewing all off-
label promotions is not tracked and the following description is meant 
to provide a rough estimate of FDA's Center for Drug Evaluation and 
Research contribution.
    Staff in the Division of Drug Marketing, Advertising, and 
Communications (DDMAC) check for the inclusion of off-label uses of a 
drug in their routine review of promotional materials. Last year, ten 
regulatory reviewers monitored submissions by drug companies, as 
required under the postmarketing reporting requirements (21 CFR 
314.81). These submissions consisted of promotional materials that 
included reprints, sales aids, journal ads, monographs, videos, 
broadcast ads, etc. Reviewers checked these materials for compliance 
with the regulations, consulted with others in CDER when necessary, and 
took enforcement actions on materials that contain violative claims or 
issues. Violative claims or issues include, for example, misleading 
presentations, lack of risk information, and off-label uses. FDA 
receives no money from drug companies for enforcement actions.
    Regarding other off-label submissions, on November 20, 1998, 21 CFR 
Part 99 was published entitled, ``Dissemination of Information on 
Unapproved/New Uses for Marketed Drugs, Biologics, and Devices.'' This 
rule is intended to implement section 401 of FDAMA which amended the 
act to permit drug, biologic, and device manufacturers to disseminate 
certain written information concerning the safety, effectiveness, or 
benefits of a use that is not described in the product's approved 
labeling. This information can be disseminated to health care 
practitioners, pharmacy benefit managers, health insurance issuers, 
group health plans, and Federal and State Government agencies. The 
information to be disseminated must be about a drug or device that is 
being legally marketed; it must be in the form of an unabridged reprint 
or copy of a peer-reviewed journal article or reference publication; 
and it must not be derived from another manufacturers clinical 
research, unless that other manufacturer has given its permission for 
dissemination. Sixty days prior to the dissemination, the manufacturer 
must submit to FDA a copy of the information to be disseminated and any 
other clinical trial information that the manufacturer has relating to 
the safety or effectiveness of the new use. The manufacturer must 
include a copy of a protocol to support the new use and agree to submit 
a supplemental application (covered under the user fee program) for 
that use within a specified period of time, unless a supplemental 
application already has been submitted or FDA has exempted the 
manufacturer from that requirement.
    For drugs, the review of FDAMA section 401 submissions involves 
personnel from DDMAC and elsewhere within CDER. Accurate estimates for 
the amount of time this involves are not available. However, we can 
roughly estimate that this activity involves 100 percent time for 1.2 
FTE per year for DDMAC personnel and 100 percent time for 1.0 FTE for 
other CDER staff. This costs the Agency approximately $250,000 per year 
on off-label promotion activities.

    Senator Durbin. Thank you.

                    ORPHAN DRUG PRODUCT DEVELOPMENT

    I included a colloquy on the floor last year about another 
area, the orphan drug product development. It appeared to me 
that the Food and Drug Administration was using some of the 
funds which we appropriated for that purpose for other 
purposes. And in the colloquy I tried to make it clear that we 
wanted the orphan drug product development money to be spent 
for that purpose.
    Are you familiar with the agency procedure and whether it 
is using these funds for another purpose?
    Dr. Henney. Senator Durbin, I am very aware of your 
interest and concern about the orphan drug program. It has been 
highly successful in moving products to the marketplace where 
there is a small population, if you will, to use these drugs.
    I think it has been a real success story of the agency. It 
has been a program that in nearly all of the budget 
restrictions and reductions that the agency has had to undergo 
in the past few years--was protected from those kind of cuts.
    This past year when we had to absorb additional cuts, we 
did ask the orphan drug program to take a proportional share to 
meet the increases needed for payroll. I do not think that it 
will significantly impair their ability to do a good job this 
year. But we cannot stand for it to happen another year in a 
row.
    Senator Durbin. Mr. Chairman, I have two or three more 
questions. But if you would like to ask, I can come back on a 
second round.
    Senator Cochran. No. Why don't you go ahead and finish. 
I've just got a couple more questions I want to ask and then I 
will submit the rest so we get over to the military 
supplemental hearing.

                     PRESCRIPTION DRUG ADVERTISING

    Senator Durbin. One of the real revolutions in terms of 
prescription drugs in modern times has been the advertising and 
promotion of these drugs to the general public.
    There was a time when the promotion of a prescription drug 
was confined to medical journals and direct contact by drug 
representatives with doctors, for example. Now we find drugs 
like Claritin and others, prescription drugs that are being 
promoted in general television and magazine and newspaper 
advertising.
    They usually--I think they're required to make some record 
of the contraindications and warnings associated with the drug 
in magazines that borders on ridiculous, to turn the page and 
see on the other side of a full colored ad for a prescription 
drug, something that looks like the fine print from the old 
days of Pravda where you're supposed to try to work your way 
through it and figure out what the dangers of this drug might 
be.
    I'm concerned. I understand what the drug companies are up 
to. They clearly want patients to say to doctors. I just heard 
about a new drug. Didn't I read in The Washington Post this 
morning there's a drug that's going to help me lose some 
weight. What about it, doctor, can I have that. That's the 
natural feeling on this.
    There seems to be an interest by the FDA to make sure that 
the consumers are well informed about the dangers of certain 
drugs even beyond what their doctors might tell them with the 
development of the so-called MedGuides that were to be 
distributed by the pharmacies to the consumers directly.
    We got embroiled in that controversy last year as to 
whether we should restrict the distribution of these MedGuides. 
And I think we ended up with half a loaf when it was all over.
    Could you tell me what the FDA policy is in terms of these 
MedGuides, not only the mandatory MedGuides for the most 
dangerous drugs but the voluntary distribution of these 
MedGuides to these consumers?
    Dr. Henney. Senator Durbin, you raise several different 
issues within the context of your question.
    With respect to the MedGuides, they are restricted, if you 
will, to the most significant or dangerous products.
    With respect to the issue of direct to consumer 
advertising, like most issues that the agency deals with there 
are at least two very strongly held opinions.
    One is that there is not enough information provided to 
patients to make an informed choice and the other that even if 
this does cause a patient to query their health professional 
about a product that they have read about, it provides an 
opportunity for an encounter of that patient and that health 
professional discuss their health condition and why or why not 
they are suited to that product or others.
    So there is real debate on the issue of the direct to 
consumer advertising. I think from the agency's point of view, 
our strongest emphasis has to be on seeing that the information 
provided is balanced and not misleading. And I think that we 
are trying with the increased use of this direct to consumer 
advertising and to see that this proper balance is struck.
    Senator Durbin. I hope that the Congress will support you 
in that. I think as it is legal for these companies to 
advertise direct to consumers, we have an obligation at the 
governmental level to make certain that consumers are well 
informed about the adverse effects that a drug might have on 
them personally.

                           SEAFOOD INSPECTION

    I have a couple of other questions about seafood 
inspection. But I'm going to send you a direct letter on that.
    I'd just like to ask you one other final question before 
making an observation and that is I am an advocate for a single 
food safety inspection agency. We have so many different 
agencies. The federal government, including yours, that have a 
responsibility here and so many different standards between, 
for example, the U.S. Department of Agriculture and the Food 
and Drug Administration.
    What is the frequency of inspection by the FDA of the food 
processing agencies that are under your jurisdiction?
    Dr. Henney. Senator Durbin, I would ask Mr. Levitt if he 
could give you that precise information but as my memory serves 
me it is close to once every ten years in terms of many of the 
processing plants that we can inspect.
    This issue is one that I tried to raise within the context 
of that part of the budget that looks at our post marketing 
surveillance capabilities; where we have not been able, because 
of limited resources, to meet our food inspection goals within 
the context of our current budget.
    Joe, could you be more precise about the answer.
    Mr. Levitt. Thank you.
    Number one, seafood--let me take it in tiers--seafood 
inspection is now once every year. That is thanks to the 
appropriations that are provided by the Congress.
    Senator Durbin. And I might say just for the record. In 
context, meat and poultry inspection is on a daily basis. 
Seafood inspection is on an annual basis.
    Proceed.
    Mr. Levitt. Okay. Thank you.
    It is our goal to be able to do an annual inspection--in 
all of the, what we consider, high risk establishments, that is 
establishments that process products that are at high risk of 
microbiological contamination.
    There are about 6200 such firms. The money that we have 
requested in this year's budget submission would allow us to do 
that. We have raised the frequency of those and we're now doing 
those every two to four years but we would like to get that 
down to one year.
    The remaining firms are then food processors which would be 
regular food companies. And then we also have food warehouses 
which are also food establishments. We try to titrate overall--
if you include all the food warehouses, the federal government 
is inspecting on the order of seven to ten years.
    If you include states which also have a presence in a 
number of these areas, that the time comes down significantly. 
One of our goals is to increase our cooperation and 
collaboration not just with other federal agencies, as you've 
mentioned, but also with the states so that together we can 
provide the kind of food inspection presence that I think the 
consumer wants.

                       INTERNATIONAL INSPECTIONS

    Senator Durbin. In terms of international inspections, do 
you do any overseas inspections of food exporters to the United 
States?
    Mr. Levitt. We have a relatively small program that is 
growing. This year we are doing 100 overseas inspections. In 
our proposal in the budget before you; we would be able to more 
than double that to about 250 inspections.
    Senator Durbin. Out of a universe of how many plants that 
are subject to our jurisdiction?
    Mr. Levitt. Certainly, you know, many more than that. We 
are also----
    Senator Durbin. In the hundreds? In the thousands?
    Mr. Levitt. It is certainly in the thousands.
    We are, I might add, complementing our overseas inspection 
effort, recognizing the magnitude that we're working with, 
complementing direct inspections with both technical assistance 
and foreign assessments.
    In fact, yesterday and today at the University of Maryland, 
we're conducting a conference in conjunction with USDA on 
imported fresh fruits and vegetables. There are representatives 
of over 100 countries participating.
    When I was at the Conference there was a lot of interest in 
providing for many of our trading partners the kind of food 
standard practices that we want to see here. It was good to see 
the enthusiasm that those people brought.
    Senator Durbin. Thank you. I think most Americans would be 
stunned to hear this. They believe that the level of inspection 
is going along at a much more frequent rate. That is not to 
take away anything from your agency.
    I happen to think that the billion dollars that is 
appropriated for the Food and Drug Administration is one of our 
best investments at the federal level. But I think that, 
frankly, consumers across America are asking for us to do a 
better job and we need to provide you with the resources to 
accomplish that.
    Mr. Levitt. Thank you. That is why each year we are asking 
for increments at each stage.
    Senator Durbin. I'll close by saying that I believe there's 
a request for an increase of some 19 percent in your 
appropriation, if I'm not mistaken, for fiscal year 2000. And 
among the purposes is food safety, product safety, pre-market 
review and the like.
    I'm afraid that under the budget resolution which we've 
enacted you may see a cut in your budget as opposed to a 19 
percent increase. I hope that's just not the case. I just 
believe that we are shortchanging the safety of consumers 
across America if we do that.
    Thank you, Mr. Chairman.

                      PHYSICIANS PAY COMPENSATION

    Senator Cochran. Thank you, Senator Durbin.
    I notice in the budget submission this statement about 
physicians pay compensation: ``The fiscal year 2000 request 
reflects the administration's proposed cap on the increase of 
physician compensation at 6 percent. FDA's prorated share of 
the resulting reduction is $2.3 million which was taken from 
each of the affected program areas.''
    My question is what is that about? Is that an 
administration edict? Is this sort of budget gamesmanship? Does 
this really mean that physicians are going to get their 
compensation increased at something higher than 6 percent if 
there's not a cap ordered or included in the budget? Do we have 
to legislate this cap? Is this a previously legislated cap and 
it's just recited in here?
    Dr. Henney. Mr. Chairman, I am glad you raised the issue 
but I am equally glad that Mr. Williams has volunteered to 
answer your question.
    Mr. Williams: Mr. Chairman, this does not require 
legislation but it does--it is an increase. It's a limit on how 
much can be spent. It's not a reduction but a limit on the 
increase. And it arises from a concern by OMB about the level 
of physician compensation in the department and they've asked 
us to review our situation and to report back to them.
    And it is obviously also in the context of a balanced 
budget. The Office of Management and Budget is seeking 
opportunities to economize where possible.
    So we are to examine the effect of this limit and we expect 
to have further dialogue with the OMB. As far as we know, we 
are the only agency subject to this limit.
    There are other agencies that employ physicians and have 
physician compensation systems similar to ours. But as far as 
we know, we're the only agency subject to this limit.

                              BIOTERRORISM

    Senator Cochran. The budget proposes also a $13.4 million 
transfer to the FDA for anti-bioterrorism activities as part of 
the public health and social services emergency fund.
    Specifically, my question is what is the FDA's role in this 
presidential initiative and what FDA activities will be 
supported with the $13.4 million transfer?
    Dr. Henney. Mr. Chairman, the major thrust of the agency's 
effort with respect to the bioterrorism initiative is around 
the whole issue of vaccine development and the review of those 
products; an area where we have considerable expertise that we 
can bring to this issue.
    A small portion of the amount requested is for the issue of 
food as it might be used in the event of bioterrorism or a 
bioterrorist attack. But it is a very small portion of this 
particular budget.
    Senator Cochran. Let me thank you, Dr. Henney and your 
colleagues for your assistance to our committee.
    We appreciate your presence and the fact that we had to 
reschedule this hearing and then had the full committee 
schedule another hearing on top of our schedule. So we had to 
speed this along a little faster than we would have liked. We 
appreciate your understanding and your patience with us the 
morning.

                          SUBMITTED QUESTIONS

    Senator Cochran. We have additional questions that we will 
submit to you in writing to be answered for the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
              Questions Submitted by Senator Thad Cochran
                            injury reporting
    Question. For fiscal year 2000, FDA is requesting a $15.3 million 
increase to begin to improve FDA's Injury Reporting system. Dr. Henney, 
you indicate in your testimony that ``no integrated system for the 
reporting, monitoring, and evaluation of all FDA regulated product-
related injuries currently exists.'' FDA currently has several programs 
to gather information on adverse events/injuries associated with the 
misuse or failure of FDA-regulated medical products and foods, 
including MedWatch, the Adverse Events Reporting System, FoodNet, the 
National Antimicrobial Resistance Monitoring System, and the Vaccine 
Adverse Events Reporting System. Is your plan to integrate these 
systems or to replace them with an entirely new Injury Reporting 
System?
    Answer. Our intention is to have an integrated ``system'' for the 
reporting, monitoring and evaluation of adverse events and product 
defects associated with FDA-regulated products. Such a system is not 
merely defined by electronic/computerized hardware and software but an 
entire program of implementing effective interventions, a comprehensive 
system for effectively communicating risk information to health care 
providers and consumers who need it, as well as effective processes to 
continuously evaluate and improve all of our risk-associated 
activities. We believe that some components of this overall system do 
not currently exist in the Agency and that other areas need enhancement 
and integration, such as many of the reporting systems listed in your 
question. There is no plan to replace existing reporting systems with a 
new system.
    Question. Please describe how the Injury Reporting System FDA 
envisions will operate.
    Answer. FDA's strategic goal is to minimize injuries, illness and 
deaths occurring from the use of FDA-regulated products, and improve 
the quality of available health care. The true risks associated with 
products become apparent only after they are in widespread use. Ongoing 
accurate identification and measurement of risks associated with all 
medical products, foods and cosmetics is the first step in an overall 
risk management strategy. Minimization of injuries also involves 
implementation of effective interventions, a comprehensive system for 
effectively communicating risk information to health care providers and 
consumers who need it, as well as effective processes to continuously 
evaluate and improve all of our risk-associated activities.
    The ``ultimate system'' would begin with an integrated science-
based mechanism for reporting, monitoring and evaluating adverse events 
and product defects associated with FDA-regulated products. In 
addition, full funding would provide FDA the resources to hire the 
necessary professionals trained to manage and track the flow of reports 
and to conduct the essential epidemiological, statistical and medical 
and scientific evaluations quickly enough for early intervention when 
significant problems arise. Current information systems are inadequate 
and are not systematically linked with any ability to share data 
electronically. Additionally, lack of connections with health care 
facilities, academia, and broad-based health information databases make 
it difficult to quickly explore potentially serious problems or conduct 
thorough investigations, e.g., FDA rarely has any denominator data 
available to evaluate the significance of specific reported problems.
    One of FDA's primary objectives is to develop and implement a 
system which will improve the quality of information on adverse events 
and product defects associated with FDA-regulated products. Prompt 
identification of new, previously unrecognized problems with FDA-
regulated products has the potential to decrease morbidity and 
mortality associated with those products and maximize their safe use. 
Thousands of deaths and injuries could be avoided, or their 
consequences reduced, through a comprehensive strategy aimed at finding 
out why incidents occur and implementing strategies to prevent them 
from happening again. A full understanding of the causes of product-
related deaths and injuries is necessary to ensure that causes 
attributable to product labeling, design, or composition are addressed 
in the premarket review programs, where required. For products for 
which premarket review programs do not exist, such as dietary 
supplements and cosmetics, FDA needs information about the safety and 
usage patterns of such products in order to develop appropriate 
responses.
    Accurate, complete, and efficient operation of adverse event 
reporting systems is only the first step in the management of product 
injury. Reported events must be analyzed, and other sources of data 
must be accessed to make sense of the reports and to determine what 
action, if any, is needed. All FDA safety programs need access to 
various medical databases. Successful use of these databases requires 
investment of time by FDA project managers, programmers, and 
epidemiologists, as well as investment in computing equipment. Modest 
funding increases for both staff and access to databases through 
contract vehicles are included in the proposal. In addition, funding 
for initiation of a sentinel site program for medical device adverse 
event reporting required by FDAMA is included. This active surveillance 
concept, if successful, may offer another mechanism by which FDA could 
acquire additional information regarding the nature, extent, and 
frequency of injuries due to FDA-regulated products.
    Finally, the request includes funding for risk communication 
activities, particularly for professional and consumer outreach and 
education . These are intended to both improve the quality and scope of 
adverse event reporting by the health care community, and to 
communicate safety issues. Broader communications with health care 
professionals will be essential in ensuring that improved knowledge 
about product injuries actually improves people's health.
    Question. Dr. Henney, you indicate that $15.3 million is the 
initial investment to implement an injury reporting system and that 
additional investments will be required in subsequent years to make a 
comprehensive system a reality. What is the estimated cost of the 
system FDA is planning?
    Answer. The Agency performed an analysis and determined that $64.5 
million in funding would be required for a comprehensive system. The 
fiscal year 2000 request includes $15.3 million to begin to address 
this. Such a system would include construction of an Agency-wide 
reporting system for product injuries, linkage with external databases 
to provide baseline data on the rate and characteristics of injuries, 
strengthening of FDA's scientific research efforts in the area of 
epidemiology, and developing effective outreach and educational 
programs to facilitate better reporting and improve overall product-
related risk management throughout the health care system.
    Question. Dr. Henney, you indicate in your prepared statement that 
funds for the ``limited implementation of a sentinel site program for 
medical devices are also included in the budget request''. Would you 
please explain this program. Is this included in the $15.3 million 
increase requested to initiate an Injury Reporting System?
    Answer. Yes, funding for this project is included in the $15.3 
million increase requested for FDA's overall plan for injury reporting 
systems. FDA has substantial evidence of gross under reporting of 
adverse events from device users. In response to this concern, FDA 
initiated the Sentinel Surveillance pilot program to identify barriers 
to reporting and explore methods to improve both the quality and 
quantity of data from the clinical community. Sec. 213 of the 1997 FDA 
Modernization Act provides the Agency with the opportunity to implement 
a national Medical Device Surveillance Network, the design of which is 
based on extensive research from the pilot program, other surveillance 
systems, and safety experts. The system would provide more timely and 
better quality data and allow FDA clinicians and analysts to more 
accurately identify and assess medical device-related problems. 
Mandatory universal user facility adverse event reporting would be 
phased out. The Medical Device Surveillance Network will consist of a 
random sample of eligible health care facilities, stratified by type 
and perhaps several other variables. The sample would consist primarily 
of hospitals with additions of other types of care and/or specialty 
facilities e.g. maternity, children's etc. as needed. Facilities 
recruited into the Network would be encouraged to report all device-
related problems, whether or not the problem resulted in a patient 
injury. As demonstrated in the pilot program, being alerted to 
potential problems prior to patient injury will allow FDA to focus on 
prevention. The availability of population exposure and denominator 
data from the Surveillance Network will allow FDA to quickly and 
reliably evaluate the extent of a problem and its impact on the public 
health. In addition, the Agency would have options for reducing or 
eliminating unnecessary user facility reporting costs. The Agency 
expects that industry will save approximately $19 million in reporting 
costs.
    Question. How much is requested for this medical device sentinel 
site program?
    Answer. FDA requested an overall increase of $15.3 million in the 
fiscal year 2000 budget for injury reporting and of this amount, the 
device program was allocated $3.2 million to implement phase one of a 
national Medical Device Surveillance Network.
    Question. What level of funding is now being spent on these 
existing programs to collect information on adverse events, product 
defects, and product defects associated with FDA-regulated products?
    Answer. We estimated our fiscal year 1998 base spending for these 
activities to be approximately $28 million, including approximately $11 
million for information management systems.
       transfer of the commerce seafood inspection program to fda
    Question. The fiscal year 2000 budget proposes the transfer of the 
voluntary Seafood Inspection Program from the Department of Commerce to 
FDA. Why is the transfer of this program being proposed?
    Answer. Transfer of the Seafood Inspection Program from the 
Department of Commerce to FDA will improve the safety of seafood in 
several ways. Establishing a Performance Based Organization or PBO at 
FDA will establish FDA as the sole seafood agency with one federal 
HACCP standard, thereby promoting efficiency, effectiveness, and 
consistency of seafood regulation. This centralization will help both 
domestically and internationally. In addition, the PBO will provide the 
potential of additional trained inspectors to implement the HACCP 
regulations, resulting in increased frequency of inspection. Consumers 
will benefit by improved food safety from an increased federal 
regulatory presence and a single HACCP standard established by FDA.
    Question. The budget proposes that the Seafood Inspection Program 
be transferred from Commerce to FDA through appropriations language. 
Why isn't the Administration seeking legislative authority through the 
appropriate authorizing committees of the Congress for this transfer?
    Answer. While the Administration has requested appropriations 
language to transfer the program as is, without establishing it as a 
Performance Based Organization or PBO, the longer term solution is 
authorizing legislation that would establish the Seafood Inspection 
Program as a PBO with the Department of Health and Human Services. 
Department of Health and Human Services is currently working with the 
Department of Commerce and other parts of the Administration to 
finalize a draft proposal that would accomplish such a PBO. We are 
eager to work with Congress to achieve this goal.
    Question. The current costs of the Seafood Inspection Program are 
covered by user fee collections from industry. The budget proposes that 
the program continue to be financed through user fee collections 
derived from the seafood industry. Why will the transfer of this 
program result in an additional $3 million cost to the American 
taxpayer?
    Answer. Of the one time transfer cost of $3 million in budget 
authority requested, $1.5 million is requested for training. The 
Agency, in conjunction with the National Marine Fisheries Service, 
plans to provide FDA HACCP training for Seafood Inspection Program 
inspectors . This training will enhance and ensure uniformity in 
inspection approaches and the application of inspection techniques and 
safety standards at the federal level. In addition these resources may 
provide for some general training similar to the basic training 
provided to newly hired investigators and inspectors, which includes 
food and drug law, evidence development, interviewing techniques, and 
quality auditing. The balance of the requested funds will be used to 
educate the industry regarding the PBO, provide for other 
administrative or transitional costs and establish an operating 
reserve.
    Question. What are the ``transition costs'' to FDA related to the 
proposed transfer of this program?
    Answer. The budget request also includes $200,000 in anticipated 
start-up costs to facilitate the transfer and establishment of the PBO. 
These costs include information technology and other administrative 
costs associated with the transfer of the PBO.
    Question. The budget indicates that the Administration will submit 
a legislative proposal to the Congress to make the Seafood Inspection 
Program a Performance-Based Organization under the auspices of FDA. 
Would you please explain this proposal more fully.
    Answer. FDA and the Department of Health and Human Services are 
currently working with the Department of Commerce and other parts of 
the Administration to finalize a draft proposal that would transfer the 
Seafood Inspection Program of the National Marine Fisheries Service in 
the Department of Commerce to FDA in the form of a Performance Based 
Organization or PBO. A PBO is a quasi-public organization that is 
located in a federal agency but operated like a business in that it is 
to be financially self-sustaining. Although the federal agency oversees 
the PBO, the PBO is given a great deal of autonomy to run day-to-day 
operations, particularly in the areas of personnel and procurement, in 
order to respond quickly to customers' needs and marketing conditions.
    The seafood inspection PBO would continue to perform the voluntary, 
fee-for-service inspection, grading, certification, and training 
services for the seafood industry and other customers currently 
performed by the Seafood Inspection Program in the Department of 
Commerce. In addition, FDA would be able to utilize these trained 
inspectors to perform regulatory HACCP inspections under one Federal 
HACCP standard.
    Question. Would this legislative proposal be submitted if the 
program remains within the Department of Commerce?
    Answer. We assume, if Congress rejects the $3 million requested in 
budget authority, that the proposed transfer and establishment of a PBO 
would be delayed, and that the Seafood Inspection Program currently 
authorized would continue to operate as it has for many years within 
the Department of Commerce. The legislation will be transmitted before 
the fiscal year 2000 appropriations bills are enacted
    Question. Will the transfer of the seafood inspection program from 
Commerce to FDA improve food safety? If so, how?
    Answer. Yes, the transfer of the Seafood Inspection Program 
currently located at the Department of Commerce to a PBO within FDA 
would improve food safety. First, such transfer would establish FDA's 
HACCP standard as the single safety standard at the federal level. 
Because the FDA standard would be employed uniformly in both voluntary 
and regulatory inspections, increased compliance with the seafood HACCP 
regulations will result. Second, the transfer would increase the 
federal regulatory presence throughout the seafood industry. The 
legislation would authorize FDA to commission PBO inspectors to perform 
regulatory inspections and would also allow FDA to rely on the results 
of the voluntary inspections to fulfill its regulatory obligation, 
perhaps eliminating the need for FDA to perform an additional 
regulatory inspection of a facility participating in the voluntary 
program.
                        product safety assurance
    The budget requests an increase of $31.8 million in FDA's salaries 
and expenses appropriation to achieve statutory time frames for 
inspections. The justification indicates that this additional funding 
will, among other things: (1) allow FDA to leverage the Agency's 
enforcement capability internationally by working toward regulatory 
agreements with the European Community and other nations so that 
imports meet quality and safety standards, (2) increase the frequency 
of inspections for domestic products across-the-board, and (3) provide 
for targeted inspections on those areas with the most potential for 
serious injuries.
    Question. What level of funding is now being devoted to FDA's 
enforcement of imports?
    Answer. In fiscal year 1999, FDA is devoting $83.3 million and 941 
FTE to the enforcement of imports. 15. ORA, OEA
    Question. What regulatory agreements are currently in effect with 
other nations to assure that imports meet quality and safety standards?
    Answer. We would be happy to provide for the record a table which 
shows what regulatory agreements are currently in effect with other 
nations.

                                       INTERNATIONAL COOPERATIVE AGREEMENT
----------------------------------------------------------------------------------------------------------------
             Country                  FDA Sponsor            Title          Effective Date     Termination Date
----------------------------------------------------------------------------------------------------------------
Australia.......................  CFSAN.............  Dry Milk Products.  11/28/79..........  Indefinite
Australia.......................  CFSAN.............  Shellfish           9/12/86...........  Indefinite
                                                       Certification.
Australia.......................  CDRH..............  Inspect. Info on    2/17/93...........  Indefinite
                                                       Medical Device
                                                       GMP (EOLs).
Australia.......................  FDA...............  Orphan Products...  8/13/97...........  Indefinite
Belarus.........................  CDER CBER.........  Info Exchange on    3/27/96...........  3/25/99
                                                       Drugs/Biologics.
Belgium.........................  CFSAN.............  Dry Milk Products.  11/6/74...........  Indefinite
Canada..........................  CDER..............  GMPs Exchange of    10/1/73...........  Indefinite
                                                       Drug Plan
                                                       Inspection
                                                       Information.
Canada..........................  CDRH..............  Exchange            12/16/74..........  Indefinite
                                                       Information on
                                                       Compliance
                                                       Program Efforts.
Canada..........................  CFSAN.............  Shellfish Sanitary  4/30/48...........  Indefinite
                                                       Controls.
Canada..........................  CFSAN.............  Monitoring Food,    7/26/88...........  7/26/98
                                                       Beverage &
                                                       Sanitary Srvs. on
                                                       Common Carriers.
Canada..........................  ORA...............  GLPs Phase I/Non-   5/10/79...........  Indefinite
                                                       Clinical Labs.
Canada..........................  CVM...............  Agricultural Trade  12/4/98...........  Indefinite
Canada & Mexico.................  FDA...............  Scientific and      10/30/95..........  Indefinite
                                                       Regulatory Fields
                                                       of Health.
Chile...........................  CFSAN.............  Exported Oyster,    5/18/89...........  5/18/99
                                                       Clams, & Mussels.
Chile...........................  ORA...............  Safety of Imported  10/27/89..........  10/27/99
                                                       Fresh Fruit.
Chile...........................  CFSAN.............  Fish & Fishery      5/13/96...........  5/13/01
                                                       Products.
China...........................  CFSAN.............  Certification of    12/26/88..........  Indefinite
                                                       Ceramic Ware.
Denmark.........................  CFSAN.............  Dry Milk Products.  1/19/79...........  Indefinite
European Union..................  CDRH & CDER.......  Mutual Acceptance   5/18/98...........  Indefinite
                                                       of device, drug
                                                       and biological
                                                       inspection
                                                       reports.
Finland                           CFSAN.............  Certification of    3/4/84............  Indefinite
                                                       Imported Food
                                                       Products..
France..........................  ORA...............  GLPs Phase II       3/18/86...........  Indefinite
                                                       Info. Exchange of
                                                       Toxicological
                                                       Labs.
France..........................  CFSAN.............  Caseins...........  1/15/74 & 1/15/87.  Indefinite
France..........................  CFSAN.............  Cert Program for    1/21/87...........  Indefinite
                                                       Listeria in
                                                       Cheese.
Germany.........................  ORA...............  GLPs Phase II       12/23/88..........  Indefinite
                                                       (Joint with EPA).
Iceland.........................  CFSAN.............  Safety of Fresh/    12/28/78..........  Indefinite
                                                       Frozen Shellfish.
Ireland.........................  CFSAN.............  Certification       11/5/96...........  11/5/01
                                                       Requirements for
                                                       Caseins.
Italy...........................  ORA...............  GLPs Phase II.....  12/19/89..........  Indefinite
Japan...........................  CFSAN.............  Shellfish           10/24/62..........  Indefinite
                                                       Improving &
                                                       Standardizing
                                                       Sanitation
                                                       Practices.
Japan...........................  ORA...............  GLPs..............  4/15/83...........  Indefinite
Japan...........................  CFSAN.............  Puffer Fish.......  10/24/88..........  Indefinite
Korea...........................  CFSAN.............  Shellfish           4/8/87............  4/7/97
                                                       Certification.
Korea...........................  CFSAN.............  Conservation &      11/24/72..........  Indefinite
                                                       Rational
                                                       Exploitation of
                                                       Fishery Resources.
Mexico..........................  CFSAN.............  Control of Fresh/   11/12/88..........  11/12/98
                                                       Frozen Bivalve
                                                       Mollusca for
                                                       Exportation.
Mexico..........................  ORA...............  Regulation of Raw   11/28/88..........  11/28/98
                                                       Agricultural
                                                       Products.
Netherland s....................  CFSAN.............  Dry Milk Products   1/8/79............  Indefinite
                                                       Examined for
                                                       Salmonellae.
Netherland s....................  ORA...............  GLPs Phase II.....  12/20/88..........  Indefinite
New Zealand.....................  CFSAN.............  Shellfish           10/30/80..........  Indefinite
                                                       Sanitation.
New Zealand.....................  CFSAN.............  Fish & Fishery      12/20/95..........  12/20/00
                                                       Products.
New Zealand                       CFSAN.............  Dry Milk Products   11/11/75..........  Indefinite
                                                       Facilitate &
                                                       Improve
                                                       Importation
                                                       Procedures for.
New Zealand.....................  CFSAN.............  Horticultural       3/13/95...........  Indefinite
                                                       Produce
                                                       Pesticides.
Norway..........................  CFSAN.............  Importation of      2/26/82...........  Indefinite
                                                       Rennet Casein.
Norway..........................  CFSAN.............  Listeria Program    10/15/96..........  Indefinite
                                                       for Smoked Salmon.
Philippines.....................  CFSAN.............  Certification of    9/18/86...........  Indefinite
                                                       Food Products.
Russia..........................  CFSAN.............  Food Products.....  3/29/96...........  Indefinite
Russia..........................  CDER..............  Drugs & Biological  2/2/94............  2/4/2000
                                                       Products.
Russia..........................  CDER..............  Drugs & Biological  1/30/96...........  Indefinite
                                                       Products Annexes.
Russia..........................  CDRH..............  Medical Devices     1/30/96...........  Indefinite
                                                       Info.
Sweden..........................  CFSAN.............  Dry Milk Products.  11/7/77...........  Indefinite
Sweden..........................  ORA...............  GLPs Phase I /Non-  5/25/79...........  Indefinite
                                                       clinical Labs.
Sweden..........................  CDER..............  Upgrade Quality of  10/17/72..........  Indefinite
                                                       Drugs in
                                                       International
                                                       Commerce.
Switzerland.....................  ORA...............  Inspection of       10/28/68..........  Indefinite
                                                       Production of
                                                       Swiss Drugs.
Switzerland.....................  ORA...............  GLPs Phase II       4/29/85...........  Indefinite
                                                       Exchange
                                                       Information.
Taiwan..........................  CDRH..............  Info Exchange on    1/9/98............  Indefinite
                                                       Medical Devices.
United Kingdom..................  CFSAN.............  Processing &        9/7/82............  Indefinite
                                                       Labeling of Fresh
                                                       & Frozen Clams.
United Kingdom..................  CDRH..............  Mutual Recognition  6/6/86............  Indefinite
                                                       of Medical Device
                                                       Inspections.
----------------------------------------------------------------------------------------------------------------

                        product safety assurance
    Question. What additional agreements is FDA working towards?
    Answer. We would be happy to provide for the record a table which 
shows what proposed regulatory agreements FDA is currently working to 
implement. [The information follows:]

              PROPOSED INTERNATIONAL COOPERATIVE AGREEMENTS
------------------------------------------------------------------------
                                                     Subject
------------------------------------------------------------------------
AUSTRALIA/Drug GMPs....................  Agreement on drug GMPs and pre-
                                          approval program.
AUSTRALIA/CVM EOLs.....................  Exchange information on animal
                                          pharmaceuticals.
CANADA & MEXICO Scientific & Regulatory  Cooperation in scientific and
 Areas.                                   regulatory fields of health
CANADA/MEXICO/Emergency Info...........  Agreement to enhance
                                          cooperation and to continue to
                                          exchange timely information in
                                          emergency situations.
CANADA/Seafood MRA.....................  Mutual acceptance of seafood
                                          inspection results.
CHILE/Fresh Fruits & Vegetables MOC....  Exchange of information and
                                          technical cooperation with
                                          regard to food safety control
                                          practices to protect public
                                          health and to facilitate trade
                                          of selected fresh fruit and
                                          vegetables.
CHINA/Ceramicware......................  Covers ceramicware intended for
                                          use in the preparation,
                                          serving, or storage of food or
                                          drink.
EU/Veterinary Products.................  Focus on developing a framework
                                          for working towards
                                          equivalence of systems. USDA
                                          and USTR are also parties to
                                          the agreement.
KOREA/Shellfish Extension..............  Assure that imported fresh
                                          frozen molluscan shellfish are
                                          safe and wholesome and meet
                                          NSSP sanitation principles.
UKRAINE/Drugs and Biological Products..  Importation of drugs and
                                          biologics into Ukraine.
------------------------------------------------------------------------

                          domestic inspections
    Question. You indicate that the goal is to increase the frequency 
of inspections for domestic products (except for foods) to once every 
two years, as mandated by statute, through FDA inspections and 
additional state contracts. For drugs, biologics (registered blood 
banks), animal drugs, and medical devices, this would be inspecting the 
manufacturer every two years.
    What is the current inspection level for each of these areas?
    Answer. The current inspection level in fiscal year 1999 for a two-
year statutory interval, by category, is drugs 22 percent, biologics 43 
percent, animal drugs and feed 27 percent, and medical devices 26 
percent. Successful biennial inspections would mean that inspections 
for each area should be at the 50 percent level. Although there is no 
statutory interval for food manufacturers, high risk food inspection 
levels are currently at 33 percent.
    Question. What inspections are now being performed through state 
contracts and what additional contracts are being sought?
    Answer. Currently, FDA has contracts with states to conduct 
inspections under the following areas: 40 food contracts; 19 medicated 
feed contracts; 49 MQSA contracts; and, 17 tissue residue contracts. We 
are planning to conduct a feasibility study to see how best to expand 
this program with the funds requested in the fiscal year 2000 budget.
    Question. What is the inspection goal for foods? How frequently are 
inspections being performed now?
    Answer. FDA established three primary inspection goals for foods in 
fiscal year 2000. The goals reflect the Agency's strategy in addressing 
risk with regard to both domestic and imported foods. These goals are 
for FDA to increase the frequency of high-risk domestic food 
establishment inspections to once every one to two years, and annually 
beginning in fiscal year 2001, achieve adoption of the Food Code by at 
least 35 percent of the states, and increase the number of inspections/
evaluations of foreign food establishments from 100 to 250.
    FDA is currently inspecting the 54,000 establishments in its 
inventory every 7 to 10 years. However, the Agency also has contracts 
with states to conduct inspections. This has increased the frequency of 
inspections to once every 4 to 5 years.
    Question. What is the current domestic inspection funding and 
staffing levels and what increases are being sought?
    Answer. The current domestic inspection funding is $87.7M and 
staffing level is 984 FTE. The increase sought for domestic inspections 
is $15.4M and 80 FTE. We would be happy to provide a table that 
displays a breakout of these totals by program area.

                   RESOURCES FOR DOMESTIC INSPECTIONS
                          [Dollars in millions]
------------------------------------------------------------------------
                                            Current FDA
                                             domestic       Current FDA
                                            inspection       domestic
                                          staffing level    inspection
                                               (FTE)          funding
------------------------------------------------------------------------
TOTAL FDA...............................             984         $87,730
FOODS...................................             368          33,541
BIOLOGICS...............................             185          15,649
HUMAN DRUGS.............................             203          16,720
ANIMAL DRUGS............................              53           4,276
DEVICES/RAD HEALTH......................             175          17,544
------------------------------------------------------------------------

    The increase sought for domestic inspections is $15.4M and 80 FTE. 
The increases will be used to improve the frequency of inspections for 
domestic products through increased inspections and state contracts. 
These efforts will not fully meet the statutory requirement of once 
every two years for biologics, human/animal drugs, and medical devices, 
as mandated by statute, but will improve product safety and quality 
systems conformance. The inspectional emphasis will be on high-risk 
product areas, i.e., for Medical Devices, Class II and III Manufactures 
only. We would be happy to provide a table that displays a breakout of 
these totals by program area.

  FDA--INCREASES IN PRODUCT SAFETY ASSURANCE DOMESTIC INSPECTIONS ONLY
                          [Dollars in millions]
------------------------------------------------------------------------
                                            Increase of
                                          staffing level      Funding
                                               (FTE)         increase
------------------------------------------------------------------------
TOTAL FDA...............................              80         $15,400
FOODS...................................              27           4,000
BIOLOGICS...............................              13           3,200
HUMAN DRUGS.............................              15           1,900
ANIMAL DRUGS & FEEDS....................               9           1,500
DEVICES/RAD HEALTH......................              16          4,800
------------------------------------------------------------------------
Tables include Postmarket inspections only.
Tables do not include domestic sample collections and analyses,
  research, and Premarket inspections.
Tables do not include Tobacco and Other activities.

    Question. What level of resources will be targeted on areas with 
the most potential for serious injuries?
    Answer. We would be happy to provide a table that displays a 
breakout of these totals by program area.

         FISCAL YEAR 2000 DOMESTIC INSPECTION FUNDING BY PROGRAM
                          [Dollars in millions]
------------------------------------------------------------------------
                                          Staffing level
                                               (FTE)          Funding
------------------------------------------------------------------------
TOTAL FDA...............................           1,655        $199,600
FOODS...................................             399          37,900
BIOLOGICS...............................             236          22,900
HUMAN DRUGS.............................             489          45,600
ANIMAL DRUGS & FEEDS....................              91           8,300
TOBACCO.................................              28          42,000
OTHER ACTIVITIES........................             163          15,000
DEVICES.................................             249          27,900
------------------------------------------------------------------------

                 domestic inspections--high risk areas
    Question. What high-risk areas have been identified?
    Answer. The high risk areas in the medical devices program that 
have been identified are those products that are intended for surgical 
implant into the body or to support or sustain life and whose failure 
to perform, when properly used in accordance with instructions for use 
provided in the labeling, can be reasonably expected to result in a 
significant injury to the user.
    A limited example of those products include: cardiovascular 
devices, pacemakers, stents, intra-aortic balloon and control systems, 
cardio-electrodes, defibrillators, implantable orthopedic devices, 
infusion pumps, anesthesiology devices, ventilators, condoms, surgical 
gloves, intra lens, peritoneal dialysis systems, surgical lasers, 
electro-surgical products, and many others.
    High risk areas in the human drugs program include adverse drug 
event investigation and follow-up, nontraditional drugs, drug products 
with microbiological contamination issues, controlled release dosage 
forms, stability problems, process validation issues, medical gas 
manufacture and delivery, and Y2K readiness
    It is important to consider that a prolonged priority-based program 
will cause us to not inspect for very long periods important numbers of 
drug firms in the lower priority levels. This lack of contact causes 
broad scope drift to out of compliance situations. The biennial 
inspection allows us to interact with companies and provide the kind of 
direction which may keep many firms from going out of compliance, while 
also finding those with the violative conditions and practices 
requiring full compliance attention. Over the long run biennial 
inspections keep many companies, especially he smaller ones from being 
involved in serious compliance problems.
    The biologics program high-risk areas that have been identified are 
registered blood banks; source plasma operations; and biological 
product manufacturing establishments. The Food and Drug Modernization 
Act of 1997 or FDAMA requires FDA to perform biennial good 
manufacturing practice, or GMP inspections of registered biologic 
firms.
    The high risk areas in the animal drugs and feed program include 
Bovine Spongiform Encephalopathy or BSE--an immediate health hazard; 
illegal drug residues in Meat and Poultry; National Milk Monitoring, a 
chronic public health risk; feed contaminants, an acute public health 
risk involving mycotoxins, pesticides, dioxins, microbials, 
contamination response issues, etc.; and Drug Process and New Animal 
Drug and Medicated Feed Inspection where experience has shown reduced 
coverage causes increased lack of statutory compliance, thus an 
increased public health risk.
    The Foods high risk areas include ready to eat products which will 
undergo no or minimal processing, such as heating, freezing, washing, 
that would eliminate a pathogenic organism on the food. These products 
include fresh fruits and vegetables, bakery goods, cheeses, cooked 
pasta dishes, etc.; heat and serve products which normally receive a 
heat treatment prior to final consumption by the consumer; all low acid 
canned and acidified foods which if not properly processed may present 
a potential hazard to health in the form of botulism; seafood products 
particularly those that are scrombotoxic e.g. mahi mahi, pompano, tuna, 
salmon, swordfish, those susceptible to ciguetera, e.g. grouper, 
snapper, Spanish mackerel and those susceptible to other natural toxins 
including paralytic fish poison, amnesic shellfish poison, 
gemphlotoxin, etc.; and infant formula.
                          spending priorities
    Question. In its plan for Statutory Compliance, FDA indicates that 
``significant additional resources, as well as prioritization of FDA 
activities, are essential if FDA is to meet its statutory requirements 
on a sustained basis and to meet public expectations''. It is unlikely 
that significant additional resources will be available to this 
Committee given that spending must be brought below the fiscal year 
1999 levels to comply with the statutory caps on discretionary 
appropriations. Given this, what can you tell us about FDA's plans to 
prioritize its activities and redesign its internal operations and 
processes to better utilize its existing resources to meet its 
statutory obligations and to meet newly emerging challenges?
    Answer. In an effort to meet its statutory obligations and emerging 
public health challenges, FDA must continuously and carefully examine 
its priorities. Our focus on risk-based decision making , the use of 
third parties in the regulatory process, technologic enhancements, and 
systems reengineering will all contribute to a better, more efficient 
use of resources. Involving our external stakeholders, as well as state 
and federal government collaborators becomes increasingly important in 
an environment of diminished resources. These constituents help the 
Agency in understanding emergent issues, and they contribute ideas to 
improve our systems.
    Within this scenario of funding limits, FDA's overall strategic 
directions that are outlined in the FDA Modernization Act ``Plan for 
Statutory Compliance'' remain as viable approaches to a fiscally 
uncertain future.
    FDA's six strategic directions mentioned here include establishing 
risk-based priorities, strengthening the scientific and analytical 
basis for regulatory decisions, working more closely with external 
stakeholders, continuing to re-engineer FDA processes, adopting a 
systems approach to Agency regulation, and capitalizing on information 
technology. We believe that these six strategic directions constitute a 
framework for managing environmental changes of many different sorts--
fiscal, scientific, human resource, consumer preferences, and so forth. 
Even with this strategic framework, however, the outcomes become a 
matter of degree in relation to the resources available to address 
those statutory or public health priorities.
    Question. Given the likelihood that this Committee will not have 
additional resources available to it above the fiscal year 1999 level, 
what priority would you place on the increases FDA requests for fiscal 
year 2000?
    Answer. FDA has requested an increase of $216 million in 
appropriated funding for fiscal year 2000. This increase request 
resulted from a comprehensive analysis of our current performance 
levels and those levels needed to achieve our statutory obligations. 
Our experience tells us that without additional resources, progress 
toward many very important outcomes cannot be achieved.
    For example, $95.5 million of the increase request is intended to 
boost the public health infrastructure. That includes reducing injuries 
from the improper use of FDA regulated medical products, protecting 
consumers and industry from unsafe products by enhancing inspectional 
coverage of domestic and imported products, and reducing delays in 
getting important new products on the market. Without additional 
funding, FDA cannot meet its statutory obligations in the short-term or 
the long-term. Even with system-wide improvements in setting priorities 
and increasing efficiencies, the diminishing resources cannot be 
overcome because the future cost of rebuilding the public health 
infrastructure will be considerably higher than the incremental 
maintenance of the existing system.
    Other components of the increase request include the Presidential 
Initiatives for addressing bioterrorism, preventing tobacco use among 
youth, and food safety, as well as mammography quality standards. 
Without increased resources, FDA will be ill-equipped to respond to 
those priorities.
                      premarket application review
    Question. The fiscal year 2000 budget requests an increase of $11 
million for premarket application review to improve FDA review times 
for premarket approvals to meet statutory requirements, supplemented by 
$17 million in collections from proposed new ``additive'' user fees.
    The budget justification submitted to this Committee indicates that 
premarket review of food and color additive petitions ``is one 
particular area where FDA recognizes the need to improve performance.'' 
How has the agency worked over the past several years to improve its 
level of performance in this area within existing resources?
    Answer. In April 1995 and May 1996 FDA reported to a Congressional 
oversight committee regarding the premarket review of food and color 
additive petitions. At the time of the 1995 hearings FDA had an 
inventory of 295 petitions of all types.
    FDA has implemented several activities to improve the level of its 
performance. In late 1995, and again in late 1996 FDA's Center for Food 
Safety and Applied Nutrition or CFSAN, reallocated resources within the 
Center to transfer 23 employees from other programs to the premarket 
review program for food and color additives. In addition, FDA provided 
an influx of 7 million dollars for infrastructure improvements and for 
third party reviews to provide scientific input into premarket reviews 
to help reduce the number of overdue petitions and speed the review of 
newer petitions. By the end of fiscal year 1996, FDA had reduced the 
1995 petition inventory of 295 by more than 100 petitions. Since the 
1995 hearing FDA has received over 220 food and color additive 
petitions, including over an increase of more than 50 percent in the 
number of petitions submitted from fiscal year 1997 to fiscal year 
1998, and has successfully completed the review of over 100 of those 
approximately 220. The current inventory is approximately 220 
petitions.
    Since April 1995, CFSAN also has codified a threshold of regulation 
process for exempting low-risk food additives migrating from food 
packaging from the requirement of a food additive petition. FDA 
estimates that this process has thus far eliminated the need for over 
200 petitions to be submitted to the agency.
    Question. The FDA plan for statutory compliance issued in November 
of 1998 indicates that FDA has successfully adopted a number of 
innovations and re-engineering approaches to improve review 
performance, but has now reached the point where additional 
improvements in performance for non-PDUFA statutory requirements cannot 
be met without additional resources. What innovations and re-
engineering approaches has FDA adopted to improve review performance 
times?
    Answer. PDUFA is a successful model both in terms of reduced review 
times and terms of facilitating the development of needed products. In 
other areas, however, this is a problem because there is a mismatch 
between the enormous societal investment in new product development and 
the resources available to FDA to fulfill its expanded role of 
facilitating the development of these new therapies. The consequence is 
evident in FDA's performance plan. In Medical Devices, it is estimated 
that the percentage of Premarket Applications reviewed within 180 days 
will drop from 83 percent to 70 percent between fiscal year 1998 and 
fiscal year 1999. In Veterinary Medicine, the percentage of New Animal 
Drug Applications and Abbreviated New Animal Drug Applications reviewed 
within 180 days is projected to decrease from 75 percent in fiscal year 
1998 to 65 percent in fiscal year 1999. Even if review times are 
maintained, this will be achieved by devoting increasing proportions of 
the science base resources to application review. But, with resources 
that keep pace with America's R&D investments, FDA can hope to keep up 
with industry's scientific and technological advances, and not only 
reduce review times in all areas of product review, but also play the 
vital role in shaping a more efficient and productive product 
development process in accordance with the new FDAMA mission statement.
    Question. How have review times been improved through these 
innovations and approaches?
    Answer. I would be happy to provide a detailed report of how review 
times have been improved for each of FDA's review activities.
Center for Devices and Radiological Health
    FDA continued with its major reengineering effort, initiated in 
1997, to improve the device review program and make it more responsive 
to stakeholders. FDA also made substantial progress in implementing the 
device provisions of the FDA Modernization Act (FDAMA). FDA anticipates 
that improvements and changes that arise from reengineering and FDAMA 
activities, when fully implemented, will enhance performance levels 
beyond fiscal year 1999. The table below shows that for fiscal year 
1998, FDA met its goal in reviewing 510(k) first actions within the 
statutory time limit but a lot improvement is still needed in the 
review program for 510(k) final actions, PMAs, and PMA supplements.

                                                  [In Percent]
----------------------------------------------------------------------------------------------------------------
                                                                  Performance in
                                                        FDA         fiscal year   Performance in
                 Goal Statement                   Performance in       1997         fiscal year      Statutory
                                                    fiscal year   (reengineering       1998         Performance
                                                       1996         Initiated)
----------------------------------------------------------------------------------------------------------------
Complete review of PMA first actions within 180               51              74              79             100
 days and HDE actions within 75 days............
Review final actions for PMA Supplements within               69              65              89             100
 180 days.......................................
510(k) firstactions within 90 days..............              94              98            99.6             100
Complete 510(k) final actions within 90 days....              65              70              75             100
----------------------------------------------------------------------------------------------------------------

Center for Drug Evaluation and Research
    These initiatives are directed at reducing the total time to 
approval of generic drugs (ANDA's), not specifically to reduce review 
times. (As background, approval times include agency review times as 
well as time with firms to address any deficiencies identified by 
agency reviewers. Average review times for original ANDA and major 
amendments has not changed by much in several years, i.e., we review 
about 50 percent of the ANDA's within 180 days.)
    However, as a result of these initiatives, total time to approval 
of generic drugs has decreased as shown:

                                                    Median approval time
        Fiscal year                                            in months

1995..............................................................  28.2
1996..............................................................   4.7
1997..............................................................   9.6
1998..............................................................   8.7

Center for Veterinary Medicine
    Review times for the Animal Drugs and Feeds Program have not yet 
improved. FDA's move away from the traditional review process for New 
Animal Drug Applications toward the phased review process has added a 
small amount of work to the review of applications. However, this 
change is expected to increase animal drug availability, reduce the 
overall animal drug development time, and reduce the time and costs to 
sponsors for developing new animal drugs.
Center for Biologics Evaluation and Research
    The Prescription Drug User Fee Act (PDUFA) has resulted in more and 
better applications that can be filed immediately, and reviewed and 
approved more quickly. New products get on the market faster, and the 
American consumer and the pharmaceutical industry benefit. The 
cumulative effects of additional human and financial resources; the use 
of project management methodology to guide the review process and 
monitor the increasing workload; the elimination of overdue 
applications; and the increased emphasis on timeliness as a performance 
measure, have significantly improved Agency and industry performance, 
predictability, and accountability.
    The median approval time (from application receipt to approval) for 
PDUFA product license applications (PLAs) and biologic license 
applications (BLAs) at CBER has declined dramatically from 31.3 months 
in fiscal year 1993, to 12.0 months in fiscal year 1997. (CBER's 
performance against the fiscal year 1998 12-month review performance 
goals will not be available until the end of fiscal year 1999, 12-
months after the end of the fiscal year.) In fiscal year 1993, the year 
before PDUFA became effective, CBER's median PLA/BLA approval time was 
31.3 months for PDUFA-type applications.
    FDA's review performance with non-PDUFA license applications has 
also improved, however, not as dramatically as with the PDUFA 
applications. In fiscal year 1997, CBER's median approval time for non-
PDUFA PLAs/BLAs was 8.3 months compared to 23.3 months in fiscal year 
1993.
    Question. And, why has the agency now reached the conclusion that 
no further improvements can be made without additional resources?
    Answer. For the past several years, the Agency has made concerted 
effort to re-engineer its application review process. However, we do 
not foresee any additional improvements on the immediate horizon that 
will have a substantial impact Improvements at this point are likely to 
have only minor savings for the review process. This is a serious 
concern if the rate of submissions of new applications continues to 
increase as it has over the past few years. With reengineering efforts 
and implementation of FDAMA activities, FDA has made substantial 
progress in many aspects of its application and review program. For 
example, review times for certain applications have decreased 
significantly and backlogs have been eliminated. However, improvements 
in other areas are still needed and prospects for these improvements 
are dim without additional resources. The Agency has been asked to take 
reductions each year to streamline operations, while expending 
substantial reviewer and other resources to implement other 
initiatives. Just as was the case for PDUFA applications, with 
additional resources to hire more reviewers and improve the information 
technology infrastructure, the Agency can achieve the levels of 
performance the American people deserve.
                             new user fees
    Question. The fiscal year 2000 budget indicates that user fee 
legislation will be submitted to the Congress to enable FDA to expand 
its programs for the review of new medical devices, food additives, and 
food contact substances.
    When will these legislative proposals be transmitted to the 
Congress?
    Answer. Proposed legislation to authorize new fees to enhance the 
quality and timeliness of premarket review for both direct and indirect 
food and color additives, and for medical devices is in clearance 
within the administration. The legislation is anticipated to be 
completed shortly and submitted to the appropriate committees in 
Congress.
    Question. What fee schedules were assumed as the basis of the 
budget estimate that an additional $17 million can be collected and 
available to the FDA in fiscal year 2000 from these proposed new user 
fees, if enacted into law?
    Answer. The budget proposes FDA be authorized to charge fees 
totaling $17.0 million in fiscal year 2000 to improve performance in 
review of medical device applications and food and color additive 
petitions. It also requests a premarket notification program for food 
contact substances established under the FDA Modernization Act. FDA 
proposes a device user fee program that will generate approximately $7 
million in premarket review fees associated with high-risk devices and 
device registration fees each year of its existence. The Agency also 
proposes a foods premarket review fee program that will generate 
approximately $10 million in fees, $4 million for food additive 
petitions and $6 million for a premarket notification program for food 
contact substances. The exact amounts of the individual fees will be 
forthcoming with the transmittal of the Administration's legislative 
proposal.
    The Food and Drug Administration Modernization Act of 1997 amends 
section 409 of the Food, Drug, and Cosmetic Act to establish a process 
whereby the manufacturer or a supplier of a food contact substance can 
notify the FDA of the intent to market certain food contact substances 
and, unless FDA objects to the notification within 120 days, the 
manufacturer may proceed to market the product. This premarket 
notification program for food contact substances is a replacement for 
the food additive petition, or FAP, process for the majority of food 
additives that are food contact substances. It also is an alternative 
to the Agency's threshold of regulation or TOR process for exempting 
food additives from the requirement of an approval regulation.
    The Agency expects that this notification process will be very 
attractive to industry because a notification will require information 
comparable to that in an FAP or TOR submission, but will automatically 
become effective after a 120-day review period if FDA does not object 
to the marketing of the substance for the proposed use. Unlike food 
additive approvals, premarket notifications will be proprietary since 
such notifications will authorize the marketing of substances only for 
the substance identified in the notification and not similar or 
identical substances prepared by someone other than the manufacturer 
listed in the PMN. Based upon these two factors, the Agency expects to 
receive a larger number of notifications than it presently receives as 
FAPs and TOR submissions for food contact substances.
    As amended, section 409 requires that the Agency object to a 
premarket notification within 120 days of its filing in order to 
prevent a food contact substance from being marketed. While food 
contact substances are used such that they typically enter the diet 
only at relatively low levels, they also may be or contain toxic 
chemicals. Therefore, it is essential that the Agency have the 
necessary resources to complete the review of PMNs within the allotted 
time and identify those substances that have not been shown to be safe. 
Likewise, it is important to ensure that existing resources in the FAP 
and TOR programs are not redirected prematurely.
    Food Additive Petitions will still be required for certain food 
contact substances of greatest public health concern and for food 
additives added directly to food. These required petitions are 
typically the most resource intensive to review. FDA's program for 
premarket review of food additive petitions needs adequate support to 
meet goals established under the Government Performance and Results 
Act, to reduce the current petition inventory, and to make progress 
towards meeting statutory time frames, as mandated by Section 903 of 
the Federal Food, Drug, and Cosmetic Act, as amended by FDAMA. Thus, if 
the resource demands of the PMN program are not adequately provided 
for, resources from the related food additives program may need to be 
redirected to PMN, with the result that goals of the food additives 
program would be undermined.
    Legislation would authorize collections of additive user fees to 
support costs of review of food and color additive petitions and would 
conform the current additive user fee authorization to the fee 
authorization for food additives. Fees would be assessed on each person 
who submits a food or color additive petition and on food ingredient 
manufacturing establishments as defined in the bill. Revenue from the 
fees would be used to increase resources available for the review of 
food additive and color additive petitions and related activities, with 
the goal of significantly expediting these reviews and supporting more 
prefiling discussions and consultations with petitioners.
    Regarding device user fees, as indicated by FDAMA requirements, 
Congress and Agency stakeholders expect more timely and interactive PMA 
reviews. Accordingly, FDA will use these additive device user fees to 
significantly increase the effort devoted to PMA and PDP reviews, 
including enhancing the timeliness and quality of the review process as 
well as increasing interactions and consultations with industry. In 
addition, the user fee revenue will enable FDA to stay current with 
increasingly complex new technologies, update review standards and 
provide high quality, timely guidance to industry and reviewers. The 
medical device strategy is to concentrate resources on high risk, high 
impact products or work areas where they are likely to have the 
greatest impact on public health. With the proposed user fees, the 
percentage of reviews completed within established time frames will 
increase, average review times will go down, and the FDA will be able 
to support increased interaction with industry.
    Question. Has the FDA consulted with the affected industries in the 
development of these user fee proposals?
    Answer. In the area of food additives, review fees are proposed for 
increasing support for the review of food and color additive petitions, 
and funding the program, established in FDAMA, of premarket 
notification for food contact substances, or so-called indirect food 
additives such as food packaging materials.
    With regard to food contact substance premarket notification, it is 
our understanding that this program is generally supported by the 
affected industry. Further, the program as incorporated in the Senate 
version of the FDAMA legislation included a user fee provision that we 
understand was supported by industry.
    With regard to fees to support the review of food and color 
additive petitions, we understand a group of the larger companies that 
produce food additives directly added to food and several major trade 
groups of the food industry have endorsed the concept of user fees, as 
long as those fees are additive to the base budget, are targeted 
explicitly to improving the timeliness of petition review, and are 
accompanied by clear, publicly articulated performance goals. The 
industry is also concerned that any fee program include legislative and 
management changes to the review process. We certainly agree with the 
principles expressed, and believe we can work with the industry and 
consumer groups on process changes that we can all endorse.
    FDA is requesting a total of $7.0 million in medical device fees to 
improve the quality and timeliness of its medical device review 
process. Growth in the size of the device industry and in the 
complexity of new medical devices will continue to challenge the FDA 
unless additional resources for device reviews are available. The 
proposed user fee funding will enable the FDA to expedite review of 
PMA/PDP applications and achieve statutorily established performance 
goals by 2002. In 1997 during FDAMA discussions, the device industry 
made it clear they wanted substantive review and decisions in 90-180 
days from submission.
    Question. Will the Administration's proposals affect small 
businesses or will small companies be exempt?
    Answer. The vast majority of the device industry are small 
businesses, 96 percent have fewer than 100 employees and 98 percent 
have fewer than 500 employees. Therefore, fees are being focused on PMA 
applications, which tend to be submitted by larger firms, and some 
waivers for small businesses are being considered. Administration 
officials are in the process of discussing this proposal with industry.
                             generic drugs
    Dr. Henney, this Subcommittee for the past two years has directed 
additional funding to the Office of Generic Drugs. An increase of $1 
million was provided for each of fiscal years 1998 and for fiscal year 
1999.
    Question. Please provide the total funding level and full-time 
equivalent staffing level for the Office of Generic Drugs in each of 
fiscal years 1997, 1998 and 1999.
    Answer. I would be happy to provide a table that displays that 
information.

                    OFFICE OF GENERIC DRUGS RESOURCES
------------------------------------------------------------------------
                                          Funding Level/
               Fiscal Year                   Operating      FTE Ceiling
                                              Budget
------------------------------------------------------------------------
1997....................................      $8,991,000             127
1998....................................       9,693,000             132
1999....................................      10,693,000             132
------------------------------------------------------------------------

    Question. Please indicate how the full-time equivalent staffing 
positions for the Office of Generic Drugs were allocated in each of 
fiscal years 1997, 1998, and 1999.
    Answer. We do not calculate staffing allocations based on ceiling 
levels. However, I will provide a chart with information about the on-
board staff by discipline.

                                        OGD ON-BOARD STAFF BY DISCIPLINE
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                           Discipline                                  1997            1998            1999
----------------------------------------------------------------------------------------------------------------
Chemistry Reviewers.............................................              47              48              44
Bioequivalence Reviewers........................................              24              22              25
Consumer Safety Officers/Project Managers/Techs.................              17              17              15
Clerical (Secretaries/Clerks, TIA's)............................              10              11              11
Labeling Reviewers..............................................               9              11              11
Legal, Administrative, Management...............................               8               9               7
Microbiologists.................................................               2               2               4
Application Examiners...........................................               2               2               2
Medical Officer.................................................               1               1               1
Computer Specialists............................................  ..............               1               2
----------------------------------------------------------------------------------------------------------------

    Question. What is the fiscal year 2000 total funding request and 
full-time equivalent staffing level for the Office of Generic Drugs?
    Answer. The total funding request for the Center for Drug 
Evaluation and Research's Generic Drug Evaluation program for fiscal 
year 2000 is 366 full-time equivalents, and a total request of 
$38,298,000. This total includes a $1.9 million proposed increase in 
funding for the Office of Generic Drugs, which would include funds for 
11 additional FTE.
    Question. For fiscal year 2000, the President's budget proposes to 
add 11 more full-time equivalent positions to the Office of Generic 
Drugs and to increase funding by $1.9 million. If this Subcommittee 
ultimately approves that increase, what assurances can you provide the 
Subcommittee that the funds will go towards the hiring of more generic 
reviewers and not be diverted to other areas of the Center for Drug 
Evaluation Reviews (CDER) or the Office of Regulatory Affairs?
    Answer. The requested resources will be directed toward the review 
of generic drugs to provide additional review staff as well as 
infrastructure support and improvement for the Office of Generic Drugs. 
As in years past, if concurrent cuts in resources are mandated in the 
Agency, the Center will not be able to protect the generic drugs 
program from such cuts. Therefore, the additional resources would have 
to, at least in part, offset any mandated reductions. If approved, this 
increase for the Office of Generic Drugs will provide improved general 
information technology infrastructure environment which currently 
results in delays in approvals of generic products; expedite the 
transition toward electronic review; allow the Office to recruit hire, 
and train new generic drug reviewers; maintain the system for 
electronic reviews and the database for use by reviewers, or archival 
submissions for the Entry Validation Application program introduced by 
CDER's Office of Pharmaceutical Science in 1997 for electronic 
structured submissions of bioequivalence data that accompanies generic 
drug applications; enhance systems to include electronic microbiology 
and labeling data and other related initiatives e.g., online copies of 
labeling.
    Question. While the Office of Generic Drugs has made some positive 
improvements in its approval times for drug applications, it still 
falls short of meeting its statutory obligation to approve applications 
within a 6-month period. According to FDA's own figures, the average 
approval time in 1998 was 18 months, three times more than the 
statutory period. Equally troubling is the fact that since 1994, the 
number of generic applications pending over the 6-month period has 
grown from 54 to 127 in 1998. What amount of resources does FDA need to 
meet the 6-month approval time required by law?
    Answer. The increase of $1.9 million, including 11 FTE, will not 
allow FDA to meet the statutory requirement to review abbreviated new 
drug applications (ANDA's) within a 6-month period.
    As background regarding ANDAs, the Food, Drug and Cosmetic Act 
states in Section 505(b)(4)(A), ``Within one hundred and eighty days of 
the initial receipt of an application under paragraph (2)... the 
Secretary shall approve or disapprove the application.'' Therefore, 
either an approval or disapproval is considered by FDA to be a final 
action. The agency makes every attempt to meet this requirement; 
however, for a number of reasons it is not always possible to do so. 
After receiving a disapproval action, manufacturers frequently resubmit 
applications that address the deficiencies indicated in the disapproval 
action.
    Neither the Center nor the Office of Generic Drugs has conducted a 
study on the budgetary needs to review the majority of applications 
within 180 days given the current review environment. However, we 
believe the needs are substantial and would have to include the needs 
of other Agency components that play a supporting but critical role in 
the generic drug review process.
    At this time, we believe that the key to addressing current review 
backlog and improving action times is increasing the number of 
chemistry, microbiology, and labeling reviewers within OGD. In 
addition, funding is needed for research to support the development of 
scientifically rigorous bioequivalence testing methodologies for 
nonsytemically absorbed drug products. The review and approval of such 
products are often subject to challenge by innovator firms. The 
stronger the scientific support of these approvals, the more likely it 
will be the Office can successfully meet innovator challenges.
                            relocation costs
    Question. The fiscal year 2000 budget requests an increase of $4.64 
million for one-time costs associated with the relocation of the Center 
for Food Safety and Applied Nutrition to its new College Park, MD, 
facility.
    Will the $4.64 million fully satisfy the costs of installation of 
the building's telecommunications system and security equipment costs?
    Answer. The fiscal year 2000 budget request included funds for one-
time costs to cover those items that must be purchased early to prepare 
the building for occupancy. The $4.64 million will satisfy the major 
portion of the building's telecommunications system, as well as most of 
the security equipment costs.
    Question. You indicate that occupancy of the new facility is 
scheduled for early 2001. Will this move result in an increase in GSA 
rental of space costs or relocation costs in fiscal year 2001?
    Answer. Preliminary discussions with GSA have indicated that the 
addition of the College Park rental payment along with the elimination 
of the FB-8, Switzer Building, and Vermont Avenue rental payments will 
result in a relatively similar or slightly lower annual rental costs. 
Until final rental costs are received from GSA, FDA is unable to 
determine the exact amount, if any, of the change in rental costs. 
There will be one time expenses to move the existing laboratory and 
office equipment and furnishings from Washington to the College Park 
location in fiscal year 2001.
    Question. What additional costs are anticipated?
    Answer. Additional costs are anticipated for a number of expenses 
including new laboratory equipment needed due to laboratory design, 
audio-visual equipment for the auditorium, training and conference 
rooms, some furniture, special computer requirements, an electronic 
database and microfilming to compensate for smaller library size and 
other items. Funding for these additional costs will be requested in 
the fiscal year 2001 budget.
                                tobacco
    Question. The fiscal year 2000 budget proposes to double funding 
for FDA's youth tobacco prevention activities to $68 million from $34 
million in fiscal year 1999. Would you please tell us how FDA is 
spending its current resources (1) on State contracts for inspection of 
retail outlets that sell tobacco, (2) on its multi-media advertising 
campaign, and (3) on product regulation, etc.
    Answer. The fiscal year 1999 budget is divided into two active 
components: enforcement and outreach. Twenty-two million dollars is 
budgeted for contracts with states and territories to enforce the age 
and ID provisions of the regulations. Ten million dollars is budgeted 
for outreach efforts. Two million dollars is budgeted for salaries and 
overhead. The Agency did not budget money for product regulation while 
the Supreme Court considers the case. However, certain limited 
activities are ongoing in the regulation area for example, the agency, 
in conjunction with other agencies within DHHS, is conducting an 18 
month research project into the efficacy of the FTC tar and nicotine 
testing procedure at the request of the FTC.
    Question. How effective have we been in each of these areas to 
date, and will the fiscal year 2000 requested funding enhance these 
efforts?
    Answer. In 1997, over a 3 month pilot period, the program completed 
1,400 compliance checks. In fiscal year 1998, the Agency completed 
30,095 checks, and in fiscal year 1999 the Agency has contracted to 
perform approximately 200,000 checks. 48,778 compliance checks have 
been completed so far in fiscal year 1999. With the enhanced funding 
requested, FDA could inspect 400,000 facilities and could ensure that 
many retailers in America were visited at least once a year.
    In order to determine the effectiveness of these activities, FDA is 
working with other agencies within DHHS to coordinate data and 
surveillance needs. These needs include monitoring tobacco use by 
youth, retailer compliance rates etc. FDA itself has established a 
computerized tobacco database to gather the results from its compliance 
checks, including the number of violations, the amount of civil money 
penalties, etc. The database will allow FDA to measure the 
effectiveness of its own enforcement efforts. Finally, the Agency 
conducted the first of many tracking studies to evaluate the 
effectiveness of its outreach efforts. Findings from the first ten 
media markets indicate that awareness of salient provisions of the 
tobacco regulation rose following FDA outreach campaign.
    Question. Please provide a table providing a breakdown of the FDA 
tobacco budget for the past three fiscal years, indicating the 
available funding and obligations by fiscal year for each aspect of the 
program, advertising, compliance, enforcement, product regulation, etc.
    Answer. I would be happy to provide a table which shows a breakdown 
of the FDA tobacco budget.

                                                 TOBACCO BUDGET
                                                  [In millions]
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                            Category                                   1997            1998            1999
----------------------------------------------------------------------------------------------------------------
Enforcement \1\.................................................            $2.0           $16.4           $22.0
Outreach \2\....................................................             1.0            12.8            10.0
Salary & Overhead...............................................             1.9             2.0             2.0
Information Technology..........................................  ..............             2.8  ..............
----------------------------------------------------------------------------------------------------------------
\1\ Enforcement includes enforcement, compliance, state contracts etc.
\2\ Outreach includes national advertising, retailer education, maintenance of a hot line, etc.

    Question. Dr. Henney, you indicate in the prepared statement that 
in fiscal year 1998, FDA began seeking civil money penalties from 
retailers found to have sold tobacco to minors at least twice. What 
were the collections from these civil penalties in fiscal year 1998 and 
in fiscal year 1999 to date?
    Answer. So far, the civil money penalties that have been assessed 
and paid have amounted to over $223,000. These amounts were collected 
from retailers found to have violated the rule twice and in a few cases 
three times. First violations result in a warning and second violations 
result in a complaint seeking $250 fine. Mitigating circumstances in 
some cases can justify a reduction in the fine below $250. The program 
has just started processing civil money penalty complaints for third 
violations. The fine for a third violation by the same retailer is 
$1500. All civil money penalty fines are payable to the U. S. Treasury.
    In fiscal year 1998, the program collected $42,625 in civil money 
penalties from second time violators. In fiscal year 1999, the program 
has collected, to date, $181,000 in civil money penalties from second 
and third time violators.
    Question. Are these receipts available to the FDA or are they 
deposited in a Department of Treasury receipt account?
    Answer. The checks are made out to the US Treasury and are not 
credited to FDA's use.
    Question. The Substance Abuse and Mental Health Services 
Administration (SAMHSA) has been conducting enforcement efforts for 
years. Why should the FDA duplicate their efforts by conducting their 
own training for their enforcement and their own sting operations?
    Answer. The FDA and SAMHSA efforts are not duplicative. Under the 
Synar program, SAMHSA oversees a program that conditions the states' 
receipt of substance abuse block grants on certain tobacco control 
activities. The Synar program is built around statistical sampling of 
youth access to tobacco products. The FDA program currently consists of 
direct enforcement of two provisions of the Agency's final tobacco 
rule. These provisions establish 18 as the minimum age of sale of 
cigarettes and smokeless tobacco products, and require retailers to 
verify age by demanding photographic identification from customers 
under the age of 27 seeking to purchase cigarettes or smokeless tobacco 
products. The FDA rule contains many other access and advertising 
restrictions that are not in effect. FDA and SAMHSA closely coordinate 
their efforts. In fact, states are permitted to include their Synar 
compliance checks in the checks that are being conducted under contract 
to FDA.
    Question. Many retailers have complained that notifications of 
violations are taking too long, sometime up to four months, and due to 
the high turnover rate of employees, the information provided comes too 
late to use for secondary training of clerks. What has the FDA done to 
address this problem?
    Answer. Retailers are entitled to timely notification of violations 
of the FDA tobacco rule. We have made significant progress in providing 
more timely notification. Today, 90 percent of the letters informing 
retailers of a first violation of the tobacco rule are mailed within 2 
weeks of the date of the inspection. In addition, FDA allows inspectors 
to return at the end of the day or the end of the shift to notify a 
retailer of a violation of a comparable state law prohibiting the sale 
of tobacco products to minors. We are also piloting a program in which 
investigators immediately notify a retailer of a violation of the FDA 
tobacco rule or a comparable state law.
                     prescription drug user fee act
    Question. What are the fiscal year 1998 and current fiscal year 
1999 base appropriation levels for prescription drug review and 
approval activities which are enhanced by collections from the 
Prescription Drug User Fee Act user fees?
    Answer. The Prescription Drug User Fee Act specifies certain 
conditions that must be met each fiscal year based on the FDA's 
Salaries and Expenses appropriation before the FDA can collect any 
fees. One of these conditions is that the amount of FDA's Salaries and 
Expenses appropriation are equal to or greater than the amount of 
appropriations for the salaries and expenses of the Food and Drug 
Administration for fiscal year 1997 multiplied by the adjustment factor 
applicable to the fiscal year involved. For making this comparison, 
FDA's 1997 Salaries and Expenses appropriation must be adjusted each 
year by an adjustment factor, which is defined in section 735(8) of the 
Act. The term `adjustment factor' applicable to a fiscal year is the 
lower of the Consumer Price Index for all urban consumers, representing 
the United States city average, for April of the preceding fiscal year 
divided by such Index for April, 1997, or the total of discretionary 
budget authority provided for programs in the domestic category for the 
immediately preceding fiscal year, divided by such budget authority for 
fiscal year 1997. Over the period of time since 1997, due to low 
inflation, the Consumer Price Index has been the lower of these two 
factors, and thus determines the adjustment.
    For fiscal year 1998 only, the fiscal year 1997 Amendments to PDUFA 
specified that the base required appropriation be the same as that for 
fiscal year 1997. For fiscal year 1999, the consumer price index of 
April 1998 (162.5) divided by the Consumer Price Index of April 1997 
(160.2) gives an adjustment factor of 1.0144. This factor is applied to 
the fiscal year 1998 base Salaries and Expenses appropriation that was 
$819,871,000. For fiscal year 1999, the FDA appropriation minimum is 
$831,743,368.
    For fiscal year 1998, FDA's total Salaries and Expenses 
appropriation, excluding user fees, was $857, 501,000. For fiscal year 
1999, FDA's total Salaries and Expenses appropriation, excluding user 
fees and $82,866,000 in GSA rent, was $888,001,000.
    Since the fiscal year 1998 amount exceeds the fiscal year 1997 
amount, and the fiscal year 1999 amount exceeds the fiscal year 1997 
amount, as adjusted, the conditions of the Prescription Drug User Fee 
Act have been met.
    The other appropriations requirement specified in PDUFA is that the 
amount FDA spends on the process for the review of human drug 
applications be as much as in Fiscal 1997, adjusted in Fiscal 1999 and 
following years in a similar manner as the adjustment factor for the 
salaries and expenses appropriation. In Fiscal 1997, FDA spent 
$147,959,689 within its Salaries and Expenses Appropriation on the 
process for review of human drug applications. In Fiscal 1998, FDA was 
required to spend the same amount, but actually spent $151,836,635. In 
Fiscal 1999, FDA will be required to spend, exclusive of fees, 
$150,083,965 on the drug application review process. FDA expects to 
spend at least that much.
             fiscal year 2000 appropriation base for pdufa
    Question. What is the base level assumed in the fiscal year 2000 
budget request?
    Answer. For Fiscal 2000, the Consumer Price Index (CPI) is the 
lower of the two possible adjustments. Based on the CPI-U for April of 
1999 (166.2 versus 160.2 in April 1997), the required base 
appropriation for FDA's Salaries and Expenses, excluding user fees and 
GSA Rent, will be $850,681,524. If this amount were not appropriated, 
the FDA would be unable to continue to collect fees under PDUFA. In 
addition, FDA will be required to spend $153,501,250 within its 
Salaries and Expenses appropriation for the process for the review of 
new human drug applications.
    These calculations do not include the amounts of FDA's Salaries and 
Expenses Appropriation that is for payment of GSA Rent for fiscal year 
1999 and fiscal year 2000. Prior to fiscal year 1998, FDA's rent 
payments to GSA were appropriated in a separate appropriation for the 
purpose of limiting those costs to FDA. These GSA rent payment were 
capped at $46.5 million. For fiscal year 1999, the Administration 
proposed including GSA Rent within FDA's Salaries and Expenses 
Appropriation at a level of $82.9 million, and Congress appropriated 
the funds in that fashion.
    This substantial increase in FDA's GSA Rent costs would distort the 
purpose of the base appropriation requirements in PDUFA if the current 
GSA Rent costs are included in the calculation, while for comparability 
the fiscal year 1997 costs are adjusted to include what was then a 
separate appropriation for these costs. Since the changes to PDUFA 
passed by Congress in 1997 specify fiscal year 1997 as the new base 
year for this calculation, we believe that FDA's Salaries and Expenses 
appropriation should be the basis for calculating whether FDA's 
appropriations for its operating budget have increased as required by 
PDUFA, and this requires adjusting fiscal year 1999 and subsequent 
years to exclude GSA Rent costs.
                         pdufa fee collections
    Question. Please provide a summary of PDUFA collections over the 
past five fiscal years, indicating how much has been spent in each year 
and the balance, if any, carried over into subsequent fiscal years.
    Answer. Under PDUFA, any fees collected and not spent by the end of 
a fiscal year continue to remain available to the Agency in future 
fiscal years. These revenues are referred to as carryover balances. The 
net result of operations in fiscal year 1998 provided a carryover 
balance of $67,518,297. This balance is a result of a one-time spike in 
fiscal year 1998 collections, attributable to collection of the second 
half of application fees for many prior fiscal year submissions, 
receipt of full application fees for all fiscal year 1998 submissions 
under the amended PDUFA procedures passed in 1997, and constraints on 
spending because of concerns regarding the shortfall in fee revenues in 
fiscal year 1999. I will be happy to provide a table reflecting the 
carryover balances with explanation for the record.
    [The information follows:]

                        SUMMARY OF PDUFA COLLECTIONS, OBLIGATIONS AND CARRYOVER BALANCES
----------------------------------------------------------------------------------------------------------------
                                                             Beginning                       Year-End
                   Fiscal year                   ---------------------------------------------------------------
                                                     Carryover      Collections     Obligations      Carryover
----------------------------------------------------------------------------------------------------------------
1994............................................     $19,582,996     $53,730,244     $39,951,020     $33,362,220
1995............................................      33,362,220      70,953,500      74,064,015      30,251,705
1996............................................      30,251,705      82,318,400      85,053,030      27,517,075
1997............................................      27,517,075      93,234,125      84,289,046      36,462,154
1998............................................      36,462,154     132,671,143     101,615,000      67,518,297
1999............................................      67,518,297  ..............  ..............  ..............
----------------------------------------------------------------------------------------------------------------

    The carryover balances do not include estimated receivables from 
fiscal year 1998 and prior years, which total $13,759,458.
    While the carryover balance grew substantially in fiscal year 1998, 
there are also a number of claims on these funds. These claims are as 
follows: (1)
  --Collection ceiling: PDUFA imposes a collection ceiling which 
        prohibits the Agency from keeping fees in excess of the amount 
        specified in appropriations for each fiscal year through fiscal 
        year 1997. Amounts collected that exceed the collection 
        ceilings will be refunded. Under FDAMA, balances collected in 
        excess of amounts specified in appropriations after fiscal year 
        1997 may be kept, and used to reduce fee charges that would 
        otherwise be made in a later fiscal year.
  --Operating funds: FDA must ensure adequate operating funds in the 
        first 4 months of each new fiscal year. Each year, two-thirds 
        of the PDUFA fees, including product and establishment fees, 
        are not paid until January 31. The FDA needs to carry forward 
        some operating costs into each new fiscal year to cover 
        expenses until the fees are received.
  --Perfommancegoals: Approximately $25 million from the carryover 
        balance has been allocated to FDA components in fiscal year 
        1999 to assure that perfommance goals for fiscal year 1999 will 
        be met.
                        buildings and facilities
    Question. The fiscal year 2000 budget proposes a $20.4 million 
increase in FDA Buildings and Facilities account to fund a portion of 
the construction of the Los Angeles Laboratory and Office project. 
Given the limitations on discretionary appropriations, what is the 
urgency of initiating construction of this project?
    Answer. The original lease for the Pico Boulevard facility in Los 
Angeles expired in 1992. The agency negotiated a six-year extension 
with two additional one-year options, and funded several necessary 
renovations to the aging and obsolete facility. The final lease option 
for the existing Los Angeles laboratory expires on March 31, 2000. The 
facility has aged far beyond its useful life. The lab cannot 
efficiently handle necessary increases in staff to support the expanded 
import work, and at this point the infrastructure of the existing 30 
plus year old facility will no longer accommodate renovations 
desperately needed to bring the building up to current laboratory 
standards. If funding is not received to begin construction of the 
replacement facility, the agency will have no other option but to 
consider closing the laboratory, and moving the functions elsewhere.
    The fiscal year 2000 budget request includes a funding of $20.4 
million to begin construction. The replacement laboratory will serve to 
consolidate three Los Angeles district sites, the laboratory on Pico 
Boulevard, the current district office in Irvine, and the San Pedro 
resident post, into one location, replacing three existing leases 
currently costing $2 million annually.
    Expected benefits from the construction of the new Los Angeles 
laboratory include providing a much safer location and a vastly 
improved working environment for FDA and state laboratory personnel. A 
concentration of scientific talent will be available which will permit 
better management of the analytical workload and provide significant 
improvement in operational efficiency. Also, better analytical coverage 
will be provided during emergencies. Additional benefits include a more 
efficient use of costly analytical equipment and better equipped 
laboratories in a state-of-the-art facility.
    Question. What is the total cost of the project and what phase of 
the project will be funded with the $20.4 million requested?
    Answer. The fiscal year 2000 budget requests $20.4 million for 
Phase I. This phase includes the construction of the core and shell for 
the entire building with major mechanical and electrical infrastructure 
systems. Phase II completes the mechanical and electrical 
infrastructure and completely fits-out both the laboratory and the 
office at an estimated cost of $20.0 million. The total estimated 
construction cost of $40.4 million is based upon receiving total 
project funding in fiscal year 2000. This cost includes laboratory 
casework, fume hoods, construction management and escalation costs to a 
midpoint of construction. The estimated construction cost does not 
include funding for furniture, telecommunication systems, or security 
systems. Funding for furniture and the telephone system will come from 
the FDA appropriations in the year in which they are needed. The 
security system is estimated to cost approximately $310,000 and the 
telephone infrastructure is estimated to cost approximately $300,000. 
The request for funding to cover these costs will be included in our 
fiscal year 2001 budget request.
    Should Phase II funding be provided in fiscal year 2001, the 
construction cost will need to be adjusted for inflation. Based upon 
receiving funds for Phase I in fiscal year 2000 the construction 
contract for Phase I would be awarded in late 1999 and would take 
approximately one year to complete. If the remaining funds for Phase II 
are appropriated in fiscal year 2001, the construction contract would 
be awarded in late 2000 and would take approximately one year to 
complete. This construction schedule would result in a projected move-
in of early to mid 2002.
    Question. Funding of $9.8 million was provided in fiscal year 1995 
to purchase land and begin engineering and design work for replacement 
of the Los Angeles Laboratory and Office. Is the land purchase and 
engineering and design work for this project complete?
    Answer. Yes. The site, a 10 acre land parcel located at the corner 
of MacArthur Boulevard and Fairchild Road adjacent to the campus of the 
University of California at Irvine, California was purchased by FDA in 
September 1996. The balance of funds was used to design the new 
laboratory and office facility. The architectural firm in joint venture 
with a consulting engineer firm is in the process of completing the 
design for the new facility. The design is expected to be complete in 
mid 1999. The solicitation for construction proposals will be 
advertised shortly thereafter to be able to award a construction 
contract in November 1999 should fiscal year 2000 funds be 
appropriated.
    Question. Funds have been provided over the past four fiscal years 
to continue the modernization of the Arkansas Regional Laboratory at 
Jefferson, Arkansas. Would you please give us an update on this 
project.
    Answer. The construction of the Arkansas Regional Laboratory or ARL 
project was separated into three phases to best utilize the available 
funding. Phase I includes the foundation, substructure, superstructure, 
exterior enclosure, and the roofing for the laboratory building as well 
as major building systems, such as fire protection, heating/
ventilation/air conditioning, and electrical. Phase II continues the 
construction of the laboratory building by completing the building 
systems and providing some office and laboratory fit-out. Phase III 
provides the renovation of the existing Building 50 in its entirety and 
completes the common ORA/NCTR administrative and support area.
    In October 1997, White Construction Company of Clarksdale, 
Mississippi, was given notice to proceed on Phase I of the project. 
Since that time White Construction has also been given notice to 
proceed on Phase II and a portion of the Phase III work. The projected 
completion date for Phases I & II is December 1999. The laboratory 
building project is currently approximately 60 percent complete. 
Current work includes finishing the building enclosure and installation 
of the building systems. The fiscal year 1999 appropriation included $3 
million to begin the construction on a portion of Phase III that 
includes exterior demolition, structural, and masonry work as well as 
some roofing repairs. The Phase III portion of the awarded work is 
approximately 15 percent complete. Current Phase III activity involves 
demolition of the existing Building 50 exterior masonry.
    FDA requested $3.0 million in fiscal year 2000 towards completing 
Phase III. Approximately $7.0 million in additional funding will be 
needed in subsequent fiscal years to complete Phase III. The 
construction contract FDA awarded included as an option, the 
construction of Phase III. When FDA awarded just a portion of the Phase 
III work in December 1998, the contractor escalated the remaining 
costs, which are currently fixed until November 1999. In order to 
exercise this option at the current cost estimates, the balance of ARL 
funding would need to occur in fiscal year 2000. Should this not be 
forthcoming all costs for the project are expected to increase. 
Therefore, any request in fiscal year 2001 or beyond would include an 
escalation increase in construction, construction management, and A/E 
post design services costs for completion of the project.
       office of cosmetics and color and related field activities
    Question. What is the total funding and staffing levels for the 
Office of Cosmetics and Color and its related field activities in each 
of fiscal years 1997, 1998, and 1999?
    Answer. I will be happy to provide the total funding and staffing 
levels for the Office of Cosmetics and Color and its related field 
activities in each of fiscal years 1997, 1998 and 1999. to the 
Committee.
    [The information follows:]

------------------------------------------------------------------------
                                              Dollars           FTE
------------------------------------------------------------------------
Fiscal year 1997:
    Headquarters........................           4,389              46
    Field...............................           1,795              26
Fiscal year 1998:
    Headquarters........................           2,825              29
    Field...............................             405               5
Fiscal year 1999:
    Headquarters........................           4,405              43
    Field...............................           1,795              15
------------------------------------------------------------------------

    Question. What funding and staffing levels are proposed for fiscal 
year 2000?
    Answer. I will be happy to provide that information to the 
Committee.
    [The information follows:]

------------------------------------------------------------------------
                                              Dollars           FTE
------------------------------------------------------------------------
Fiscal year 2000:
    Headquarters........................           4,405              43
    Field...............................           1,795              15
------------------------------------------------------------------------

                     clinical pharmacology program
    Question. The conference agreement on the fiscal year 1999 
appropriations act makes $700,000 available for Clinical Pharmacology 
program competitive grants. The justification indicates that the FDA 
will make available $500,000 to continue the operation of the four 
previously-competed grantees in this program throughout fiscal year 
1999. Please provide for the record the amount of the grant award 
provided to each of the four previously-competed program grantees for 
fiscal year 1999, and how the remaining $200,000 provided for the 
program is being allocated.
    Answer. The Agency has had to absorb pay raise and other 
inflationary costs, forcing the Agency to reduce operating funding in 
all parts of the Agency. In particular, the Agency has had to 
substantially reduce its extramural research contracts, including the 
Clinical Pharmacology program. For fiscal year 1999, the FDA asked the 
current grantees what they would need to continue through the end of 
the fiscal year. $500,000 is the amount the grantees determined they 
would need collectively to continue through the end of the fiscal year. 
Those programs that do not receive new funds will receive no-cost 
extensions to enable them to use previously-awarded funds to cover this 
time period. If it turns out that one or more of the grantees requires 
more funding than presently anticipated through the end of the fiscal 
year, then funding up to the full amount of $700,000 specified will be 
awarded.
    FDA will grant a six-month extension in the amount of $369,129 to 
the University of Illinois at Peoria, and a three-month extension in 
the amount of $130,871 to Meharry Medical College. Both Peoria and 
Meharry have concurred with FDA's proposal for a low cost extension 
based upon their fiscal year 1998 expenditure rates to continue their 
projects through the end of the fiscal year. Mayo has requested, but 
not demanded, additional fiscal year 1999 funds. SUNY has agreed to a 
no-cost extension, if FDA confirmed in writing our long standing 
promise that they will continue to be given no-cost extension so long 
as they have unobligated federal funds. 58. OFM
    Question. Are funds included in the fiscal year 2000 request for 
the Clinical Pharmacology Program?
    Answer. No, funds are not included for the Clinical Pharmacology 
Program in fiscal year 2000.
    Question. What level of funding is included in the request for this 
program?
    Answer. There is no funding request for this program.
    Question. Please describe the Clinical Pharmacology Program and its 
purpose.
    Answer. The Clinical Pharmacology Program is a program to support a 
grant for establishment of a clinical pharmacology training program 
since there is currently a nationwide shortage. The purpose of the 
grant is to: (1) increase the number of trained biomedical scientific 
personnel in clinical pharmacology, and (2) establish a clinical 
pharmacology training program at a medical school currently without 
such a program.
    Question. Please provide for the record the total funding provided 
for the Clinical Pharmacology Program in each year since the program's 
inception. Indicate how the funds were awarded in each fiscal year, 
showing the recipients of the funds and the amount awarded to each.
    Answer. I will be happy to provide that information to the 
Committee.

                                          CLINICAL PHARMACOLOGY PROGRAM
----------------------------------------------------------------------------------------------------------------
                                                                      Meharry                          State
                                                       Mayo           Medical      University of   University of
                                                    Foundation        College        Illinois        New York
----------------------------------------------------------------------------------------------------------------
Fiscal year 1993................................        $201,532        $536,558        $749,998        $411,912
Fiscal year 1994................................         247,000         538,976         748,084         516,000
Fiscal year 1995................................         201,532         536,558         749,998         411,912
Fiscal year 1996................................         201,532         536,558         749,998         411,912
Fiscal year 1997................................         181,379         482,902         674,998         370,721
Fiscal year 1998................................          60,460  ..............         224,999  ..............
Fiscal year 1999................................  ..............         130,871         369,129  ..............
----------------------------------------------------------------------------------------------------------------

                 review of aquaculture drug submissions
    Question. The growth of the United States Aquaculture industry 
requires legally safe and effective drugs to control disease. The 
industry in my State of Mississippi has formed a variety of 
partnerships and has developed many Aquaculture drug data packages that 
recently have been submitted to the FDA's Center for Veterinary 
Medicine for review. I am told, however, that the Center is unable to 
complete reviews of these Aquaculture drug data packages in a timely 
manner, and they are over 200 days overdue.
    Is the Center aware of this problem and what is being done to 
ensure the timely review of Aquaculture drug data submissions?
    Answer. Yes, the Center for Veterinary Medicine, CVM is aware of 
the problem and is doing what is can to ensure timely review of 
aquaculture drug submissions as well as submissions for all other 
animal drug products.
    The situation in is an example of the pressure FDA must deal with 
as new industries emerge. In 1991, CVM developed a program to educate 
the aquaculture industry about the animal drug approval process. CVM 
hired a specialist in aquaculture who spoke frequently before industry 
groups in order to help them understand the steps necessary to get new 
aquaculture drugs approved. CVM also developed several written 
documents to provide guidance to the aquaculture industry. As a result, 
the aquaculture industry responded to the new challenge and developed 
numerous coalitions that generated a significant amount of new data 
necessary for drug approvals.
    The aquaculture drug development program created a burgeoning 
workload for CVM. At the same time, FDA faced reduced budgets and 
significant staffing shortages. In the face of staffing shortages, FDA 
has been unable to direct adequate resources to many critical areas, 
including aquaculture drug review, illustrating why FDA is asking for 
additional review resources in fiscal year 2000.
                              rule on cfcs
    Question. The appropriations justification indicates that FDA plans 
to comply with the fiscal year 1999 conference report directive and 
publish a proposed rule on CFCs by September 1, 1999. Could you please 
give us a better idea of where FDA is in the process of preparing this 
proposed rule, what the FDA timetable is for issuing the final rule?
    Answer. The FDA has completed its assessment of all the submitted 
public commentary on the ANPR related to the use of CFCs in metered-
dose-inhalers. While the FDA has no explicit timetable, nor are all 
aspects of the publication of the NPR within FDA control, the FDA takes 
the conference report directive seriously, and is working to meet that 
directive for the publication of a Notice of Proposed Rulemaking.
                   orphan drug research grant program
    Question. I note from the budget justification that FDA has reduced 
the funding for Orphan Product Grants from the $11,542,000 level 
provided by the conference committee on the fiscal year 1999 
Appropriations Act to $11,150,000. Why?
    Answer. FDA has reduced staffing and cut operating costs across the 
board to absorb pay raise and other inflationary costs. For fiscal year 
1999, we thought it was appropriate for the orphan product grant 
program, even though it is an important program to us, to absorb a 
small reduction in funding, from the prior budgeted level of $11.5 
million to $11.1 million.
    Question. How much of the funding provided for Orphan Drug Research 
Grant Program is taken to cover overhead and administrative costs? 
Please provide an accounting of these costs for fiscal year 1999.
    Answer. In fiscal year 1998 FDA's cost to administer the Orphan 
Product Drugs program was $1.6 million for payroll and $.2 million in 
operating expenses. In fiscal year 1999 the cost to administer the 
Orphan Drugs program is estimated at $1.8 million for payroll and $.1 
million for operating expenses. For fiscal year 2000 the estimated 
expenses to administer the Orphan Drugs program for payroll will cost 
FDA an estimated amount of $1.6 million and an estimated amount of $.1 
million in operating expenses.
                  over-the-counter sunscreen monograph
    Question. Last year, the FDA indicated to the Committee that the 
final rule for over-the-counter (OTC) sunscreen drug products was to be 
published no later than May 21, 1999, the date set by the FDAMA. Please 
update the Committee on the schedule for publishing this final rule.
    Answer. The Agency remains committed to meeting the requirements of 
the FDA Modernization Act, FDAMA, regarding the issuance of regulations 
for OTC sunscreen drug products not later than May 21, 1999.
                      office of seafood inspection
    Question. How much is included in the fiscal year 2000 budget 
request for the Office of Seafood Inspection?
    Answer. FDA's request for increased funding for the Office of 
Seafood Inspection activities in fiscal year 1999 was $27 million. If 
received, the Office of Seafood Inspections will remain at the $27 
million level in fiscal year 2000.
    Question. Does the fiscal year 2000 budget request include 
continued funding for a grant to the Interstate Shellfish Sanitation 
Commission?
    Answer. Yes, The Interstate Shellfish Sanitation Commission, or 
ISSC, grant will be funded jointly by way of an Interagency Agreement 
between the FDA's Center for Food Safety and Applied Nutrition, or 
CFSAN, and the National Marine Fishery Service, Department of Commerce. 
The cost of the ISSC grant is $275,000. FDA funds $200,000 of the 
grant.
    Question. Please give us a summary report on the work being carried 
out by the Interstate Shellfish Sanitation Commission.
    Answer. The Interstate Shellfish Sanitation Commission (ISSC) is a 
consortium of State shellfish control officials, representing both 
environmental and public health agencies; including the FDA, the 
Environmental Protection Agency (EPA), and the Department of Commerce's 
National Marine Fisheries Services. The major goal of the ISSC is to 
improve information exchange and transfer among States, Federal 
agencies, industry and the consumer, and to strengthen State activities 
by providing them with procedural and policy guidance, technical 
training, research and materials for consumer education.
    In the improvement of information exchange and transfer among 
States, federal agencies, industry, and consumers, the ISSC has been 
involved in at least fifteen activities to facilitate this aim. For 
example, the ISSC participated in various fora supporting international 
shellfish restoration, the regional shellfish sanitation as well as 
CFSAN's priorities. Furthermore, relevant information regarding illness 
outbreak, recalls of shellfish and Biotoxin methodology research and 
the Food Code has been provided to States, consumers and ISSC 
membership.
    The ISSC also has reported important procedures and policy 
statements to guide States in executing the NSSP in areas such as 
Vibrio parahaemolyticus outbreaks, Vibrio vulnificus controls and 
regulations for implementation of HACCP in State shellfish programs.
    Important undertakings of the ISSC include interaction with States 
in resolving problems between States or between FDA and a State 
regarding conformity to the NSSP; communicating procedures and policy 
statements to guide States in executing the NSSP, and interacting with 
States and FDA in the development of uniform and effective state 
program evaluation criteria; providing program auxiliary support in 
facilitating State involvement in technical training, research and 
consumer education; and coordinating the collection and maintenance of 
information relating to U.S. coastal waters classified for shellfish 
harvesting and coordinate the development of a digitized mapping 
network (SIMS).
    Significant accomplishments include providing World Health 
organizations (WHO) with information explaining ISSC integration of 
HACCP into the NSSP; reviewed and commented on a FDA Shellfish Program 
Review Workshop Report; utilized the ISSC unresolved issue process to 
resolve State of Florida non-compliance with the NSSP; coordinated and 
provided third party involvement for FDA shellfish plant inspections in 
the State of Florida; utilized the ISSC unresolved issue process to 
address Gulf Oyster Industry Council complaints regarding the Texas 
Department of Health response to the 1998 Vibrio parahaemolyticus 
outbreak in Galveston Bay.
    The ISSC will continue to interact with States to implement Vibrio 
vulnificus consumer educational programs, develop risk reduction 
controls for Vibrio vulnificus, and develop criteria for assessing 
Vibrio vulnificus risk reduction controls while at the same time, 
obtain information from States and industry to provide consistent and 
coordinated input to FDA in implementing a Model Shellfish Ordinance.
                 government performance and results act
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. For the past several years, FDA's Office of Planning and 
Evaluation, OPE, has coordinated performance-based management systems 
across the Agency in order to meet the intent of the Government 
Performance and Results Act, GPRA. We have used a multi-level approach 
that promotes the use of performance management practices. This has 
included intensive training for senior and mid-level managers, 
participation in internal and external performance management 
conferences and workshops, development of a GPRA-focused web site, 
development of a liaison network between planning and budgeting staff 
within our Centers, and periodic Agency-wide planning meetings to 
discuss performance planning and improvement.
    The Food and Drug Administration Modernization Act, FDAMA, of 1997 
has become a top priority for the Agency. FDAMA established a new 
mission and specific performance targets that impact not only what the 
agency does but how it goes about achieving those goals. I would be 
happy to provide you with further information.
New Mission and Specific Performance Targets
    GPRA and FDAMA together emphasize performance management. As a 
result of the legislative mandates, FDA has been able to focus its 
energies on ways to achieve long range results through strategic, year-
to-year performance planning. This process has resulted in six 
strategic directions for the future:
  --Establish risk-based priorities
  --Strengthen the scientific and analytical basis for regulatory 
        decisions
  --Work more closely with external stakeholders
  --Continue to re-engineer FDA processes
  --Adopt a systems approach to Agency regulation
  --Capitalize on information technology
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. FDA's senior executives and key managers play a primary 
role in setting the Agency's strategic and performance goals. For both 
the GPRA annual performance plan and the FDA Modernization Act's Plan 
for Statutory Compliance, senior executive and key managers worked 
together to define performance levels that emphasize public health and 
safety results within the context of available resources. Assessing 
progress toward achieving the performance levels set forth in the GPRA 
and FDAMA plans is of growing importance at multiple levels within the 
Agency.
    A second accountability issue relates to the capability of Agency 
managers to understand the changing context of FDA's responsibilities 
and to set priorities within that evolving context. For FDAMA and GPRA, 
FDA's senior leadership identified agency-wide strategic directions in 
order to focus energies on those areas of critical public health and 
safety importance. This ability to see the changing shape of the 
environment speaks directly to the question of accountability for 
achieving results.
    Question. How is performance information being used to manage the 
agency?
    Answer. FDA has used performance information for many years to 
communicate its mission in protecting public health and safety. For 
example, performance relating to new product evaluation, product safety 
assurance, food safety, and injury reporting systems are reflected in 
the wide array of communications from FDA. In addition, those data 
become the basis for continuously improving the quality and efficiency 
of Agency activities from year to year.
    Of growing importance is the use of performance information to help 
identify funding needs. FDA's 1998 analysis helped us to forecast the 
resources needed to achieve full statutory compliance based on past 
performance information. This type of analysis lends itself well to 
building strong cases for changes in funding levels. GPRA and the FDA 
Modernization Act require more intensive and sophisticated performance 
tracking, which in turn translates into more meaningful knowledge for 
fiscal decision making.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. FDA has a good understanding of the resource requirements 
needed to achieve most of its performance goals. Inspectional coverage 
of food establishments, review time for new drug applications, 
assessment of mammography facility quality, and tobacco enforcement are 
a few examples of areas in which good performance data are available or 
will be available soon. With that information, we can demonstrate how 
resources impact program performance. For example, our 1998 analysis of 
the ``gap'' between available resources and the necessary resources to 
achieve the highest performance possible helped illustrate FDA's 
continuing need to set risk-based priorities.
    As we gain experience in implementing GPRA, we continue to improve 
our ability to evaluate the impact of changes in funding level on our 
programs and our ability to achieve the performance commitments 
outlined in the Annual Performance Plan. In some instances, changes in 
funding level may require an increase or decrease in program efforts 
and target level of performance. It may require development of new 
performance goals.
    Over the past few years, FDA has practiced several strategies for 
operating with reduced resources in spite of an increasing workload. 
These strategies have included reducing program efforts, refocusing 
program efforts to target the highest priority health risks, re-
examining the role we play in protecting public health relative to 
other government agencies, third parties, industry; and so forth. Some 
of those strategic changes have caused us to change our activity 
measures. In some instances, for example, the number of inspections 
conducted is not as appropriate a measure as the percentage of products 
approved by third-party sources. However, changes in approach will not 
change the agency's desire to improve health outcomes.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. FDA's performance planning coupled with statutory 
commitments found in FDAMA have laid a groundwork for systematic 
program enhancements. Across the Agency a series of themes reflects 
this commitment to performance improvement. I would like to provide 
this information for the record.
Systematic Program Enhancements
  --Establish Risk-Based Priorities.--as evidenced by ``fast track'' 
        processes to address the most urgent therapeutic needs so that 
        these therapies can enter the marketplace rapidly but safely.
  --Adopt A Systems Approach.--as evidenced by the Food Safety 
        Initiative, the integrated adverse event reporting initiative, 
        and the import monitoring systems that build upon the knowledge 
        and capabilities of other governmental and independent sources.
  --Work More Closely with External Stakeholders.--as evidenced by 
        progressively sooner and more frequent dialogue between FDA 
        officials and regulated industry representatives on matters 
        such as electronic submissions of applications, drug labeling 
        improvements, standards, third-party reviews, and training 
        needs.
  --Re-engineer FDA Processes.--as evidenced by various regulatory 
        simplification strategies including a new phased review process 
        for animal drugs that enables the Agency to provide periodic 
        feedback to product sponsors throughout the drug review 
        process.
  --Strengthen the Science Base for Regulatory Decisions.--as 
        represented by cooperative research agreements with FDA, 
        professional societies, and industry in order to provide a 
        venue to organize and conduct research on critical questions 
        about pharmaceutical manufacturing that can help to inform 
        regulatory decision makers in such areas as supplement 
        submission requirements or bioequivalence studies after there 
        are manufacturing changes.
  --Capitalize on Information Technology.--as exemplified by automation 
        of portions of the drug review process, posting new drug 
        therapy information on the Internet for access by consumers and 
        patients, and expanding the use of electronic communications 
        not only to disseminate information of particular importance to 
        stakeholders but also to receive their comments and 
        suggestions, all of which help to reduce the for communicating 
        adverse effect information.
    FDA has found that by promoting Agency-wide, systematic strategies 
for enhancing performance that the intent of GPRA and other statutory 
requirements can be appreciated. The effect is, that instead of being 
isolated within those components of the Agency that understand 
performance planning best, the best ideas relating to program results 
are shared openly and cooperatively.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance goals in the annual performance plan link 
directly to the budget. Each individual performance goal supports a 
somewhat broader program strategic goal, which in turn supports a major 
FDA program. In the performance plan, budgeted amounts, both dollars 
and FTE, are aggregated at the program strategic goal level. So, for 
each major program area, the total budget request represents the total 
of the program strategic goal amounts. I will provide this information 
for the record.

                                                       Number of Program
        Major Program Area                               Strategic Goals
Foods.............................................................     4
Human Drugs.......................................................     3
Biologics.........................................................     3
Animal Drugs and Feeds............................................     3
Medical Devices and Radiological Health...........................     6
National Center for Toxicological Research........................     3
Tobacco...........................................................     3

    The process used to link performance goals to budget activities 
involved program managers, planners and budget representatives from 
each major program area, their field counterparts, and analysts in the 
Office of Planning and Evaluation and the Office of Financial 
Management in the Office of the Commissioner. It involved several 
steps, the most significant of which was the gap analysis. This 
activity brought agency decision-makers together to look carefully at 
the difference between current agency performance and specific 
performance targets established by statute, such as FDAMA. In this way 
we could focus on resources needed to close the gap between actual and 
intended performance.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. At this time, we believe the budget justification and the 
annual performance plan structures work well as complementary 
documents. While we continue to look for ways to incrementally improve 
these documents and the manner in which they are used within the 
Agency, we have no plans to make major changes to their structure.
    In FDA's annual performance plan, budget amounts are set at the 
program strategic goal level, which is one level above the performance 
goal. For each program strategic goal, between one and twelve related 
performance goals have been developed. Therefore, while budget amounts 
are not assigned to each individual performance goal, budget amounts 
are specified for these clusters of related performance goals.
    In both the budget justification and the annual performance plan, 
dollar amounts are identical at the program level as well as the Agency 
level. When viewed from the performance goal perspective, the aggregate 
of FDA's individual performance goals equals the Agency's 
appropriation.
    Integration of the budget and the annual performance plan is a 
continuous learning process. We continue to look for meaningful ways to 
relate Agency outcomes with resource allocation decisions. With no 
single answer on the horizon, we continue to emphasize Agency results 
as a key driver for fiscal decisions.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. The fiscal year 2000 Results Act performance plan includes 
the final goal statements for the Agency's fiscal year 1999 performance 
plan. FDA will report on the fiscal year 1999 final goal statements by 
the March 2000 deadline.
    We expect to have reliable data for each performance goal. 
Depending on the nature of the goal statement, either metric, 
milestone, or system improvement, the data will be presented either 
numerically or descriptively. Strengths, weaknesses, or other 
qualifying statements will provide additional information about the 
Agency's performance toward that goal.
    FDA's Office of Planning and Evaluation, OPE, produces guidance 
documents and training programs, as well as arranges individual 
consultations with program managers to promote good performance 
planning practices. An important aspect of that guidance has been 
information about data reliability, verification and validation. Since 
this will be the first time that results will be reported, we 
anticipate a considerable amount of discussion during calendar year 
1999 on strategies to assure data reliability. By the time we report on 
the fiscal year 2000 performance goals in 2001, we expect to be more 
proficient at managing and reporting performance information.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. FDA has developed the capacity to measure performance in 
most areas. This is prerequisite to any discussion about basing funding 
requests on performance.
    Baseline data exist for the vast majority of our performance goals. 
In areas such as regulatory compliance, product evaluation, both pre-
and post-market, and standards development the Agency has a history 
that enables us to compare performance with fiscal resources. However, 
many of these past year performance measures have been output-oriented. 
Similarly, many FDAMA objectives are output-oriented. This means that 
while they may be relatively easy to measure, they may not fully 
capture the important public health and safety outcomes with which FDA 
is charged.
    To address our commitment to health and safety outcomes, we have 
aggregated the performance goals into program strategic goals. These 
program strategic goal statements and their associated resources are 
scrutinized and carefully worded to see that they emphasize outcomes. 
We anticipate that the majority of program strategic goals will be 
stable from year-to-year, although modifications may be necessary.
    Equipped with data showing prior years' performance, we can justify 
requested increases or decreases in funding.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. FDA's annual performance plan includes its highest 
priority, mission-critical performance goals. Various associated 
activities that support or relate to these goals may not be fully 
articulated in the performance plan even though they may be important 
to the Agency's accomplishing that goal. Nevertheless, we have taken 
into account these activities such that the aggregated costs shown at 
the program strategic goal level reflects the estimated full cost of 
the individual performance goals and their associated activities.
    Base amounts and proposed increase amounts include full costs, 
including overhead, associated with those goal statements and 
associated activities.
                                 ______
                                 
                  Questions Submitted by Senator Bond
                           regulatory review
    Question. In light of your past remarks highlighting an increased 
focus on the science-based nature of the Food and Drug Administration, 
what is the agency doing to ensure that regulatory considerations 
reflect a 1999 level of scientific understanding?
    Answer. The Science Board Subcommittee on FDA Research was 
established in March 1996, to provide preliminary recommendations to 
the parent advisory committee, the Science Board to the Food and Drug 
Administration, on appropriate criteria for determining the quality and 
mission relevance of FDA-sponsored laboratory investigation. The 
subcommittee unanimously and emphatically affirmed that, `` the 
presence in the FDA of a vigorous, high quality, intramural program of 
scientific research provides the essential foundation of sound 
regulatory policy and performance, and ensures that the FDA is, and 
will continue to be, best positioned to carry out its statutory 
responsibilities to protect, promote and enhance the health of the 
American people.''
    To this end, the Agency has placed renewed emphasis on improving 
its science base, in support of making sound regulatory decisions. All 
Centers are actively reviewing their science programs and developing 
approaches, both internal and collaborative with other parts of the 
scientific community, to build on its existing scientific expertise. 
Each Center's research program is being reviewed by committees of 
external, world class scientists. The role of these committees is to 
develop a better understanding of the scope and needs of each Center's 
research program and to make recommendations on how to better target 
research towards FDA's regulatory responsibilities and on how to 
improve and modernize its infrastructure to meet the challenges of the 
future.
    I have asked the Deputy Commissioner, Dr. Michael Friedman, to take 
the lead role in working with the Centers and the rest of the 
scientific community to develop strategies for fostering an environment 
that assures that regulatory decisions are based on the best science 
available.
    Maintaining an expert science base requires a significant amount of 
resources to hire and train scientific experts and to build and equip 
laboratories that make use of the most modern and efficient technology. 
Therefore, the Agency is requesting additional resources in the fiscal 
year 2000 budget to strengthen its science base, including research, 
necessary to ensure that its regulatory decisions reflect the state-of-
the-art science.
    Question. Specifically with respect to autologous tumor vaccines 
and the workshop FDA conducted in conjunction with the National Cancer 
Institute on December 10-11, 1998, has FDA reached any conclusions 
about how to deal with the unique challenges presented by these 
therapies so that potentially valuable research in this area can 
proceed? (I am still awaiting a response to my March 22 letter to Dr. 
Henney on this issue.)
    Answer. The Agency shares your interest in the development of 
potential new cancer therapies, and is providing the following 
information regarding actions taken since the workshop on Tumor 
Vaccines. An internal Center for Biologics Evaluation and Research 
Tumor Vaccine working group met to discuss critical issues pertaining 
to dendritic cells as tumor vaccines. This group is working with 
sponsors to characterize products for phenotype and functional activity 
to ensure lot-to-lot consistency. FDA is also encouraging sponsors to 
develop potency assays and as a result, several sponsors have already 
initiated the development of potency assays for autologous and 
allogenic tumor cell vaccines. In addition, CBER is setting up a 
scientific program to develop potency assays for autologous tumor cells 
as tumor vaccines and to determine the identity and potency of 
dendritic cells, to help sponsors develop a scientifically sound test 
for product development.
    CBER is collaborating with the National Cancer Institute, NCI 
regarding tumor vaccine research and standards. CBER and NCI scientists 
met to discuss the issues regarding the critical supply of interleukin-
4, a key cytokine necessary for the activation of dendritic cells for 
autologous tumor vaccines. As a result of joint efforts by CBER and 
NCI, the sponsor has agreed to supply this critical biological reagent 
to investigators for development of autologous dendritic cell based 
tumor vaccines.
    On April 10, 1999, CBER scientists participated in the National 
Tumor Vaccine and Cell Therapy working group meeting organized as a 
satellite meeting of American Association of Cancer Research. This 
group discussed various aspects of immunotherapeutic approaches for 
cancer. One of the sessions, chaired by a CBER scientist, focused on 
autologous vaccines. Discussion with several hundred scientists at the 
meeting led to the conclusion that characterization of potency for 
autologous tumor cells is necessary to ensure lot-to-lot consistency.
    CBER scientists provide extensive consult on a daily basis to 
numerous investigators and sponsors on tumor vaccines including 
autologous tumor vaccines product development. FDA will continue to 
work with all sponsors on the development of tumor vaccine products, as 
well as other promising therapies for cancer and other life-threatening 
diseases, so that patients can benefit from safe and effective new 
therapies as quickly as possible.
    Question. What is being done to make sure that current evaluation 
of biologics is done pursuant to a science-based approach?
    Answer. To provide effective regulatory review of biological 
products, which include vaccines, blood products, allergenic extracts, 
certain diagnostic products, and biotechnology-derived products, FDA's 
Center for Biologics Evaluation and Research, CBER conducts active, 
mission-related regulatory research to maintain and expand its 
knowledge of fundamental biological processes. Regulatory research 
projects are prioritized based on CBER's knowledge of the type of 
cutting edge technology being employed by the scientific community, 
Government, academia and industry that is most likely to result in 
innovative products or may pose unknown health threats.
    To ensure scientific expertise in biological product application 
review, CBER uses what is referred to as the ``research/reviewer 
model.'' In this model, the application review personnel spend a 
portion of their time in research-related activities. CBER researchers 
are fully integrated into the application review process. CBER 
researchers participate in the following regulatory procedures: review 
of initial new drug applications, and biologic license applications; 
development of policy and guidance documents; meetings with sponsors 
and advisory committees; participation in pre-license and biennial 
inspections; and evaluation of adverse drug reactions and risk 
assessment.
    CBER also collaborates with the NIH, the Centers for Disease 
Control and Prevention, the Health Resources and Services 
Administration and the Health Care Financing Administration on public 
health issues.
                  reuse of single use medical devices
    Question. A recent Forbes magazine article (March 22, 1999) 
explored the reuse of single-use medical devices and whether this 
practice poses a threat the patients. I understand the Office of 
Science and Technology (OST) at FDA has done a study on the issue with 
results expected soon. What is FDA's position on this issue?
    Answer. A FDA research team is evaluating the effect of cleaning 
procedures and sterilization procedures on the material and mechanical 
properties of materials likely to be in devices that are designated for 
single use but are known to be candidates for reuse by physicians and 
user facilities. The study initially focused on generic materials and 
then was extended to specific cardiac catheters such as balloon 
angioplasty catheters, electrophysiology catheters, and cardiac 
ablation catheters. These are devices that come in contact with blood. 
These catheters presented special problems in terms of complexity, e.g. 
many channels, narrow lumens, lumens closed at one end, and delicate 
materials and design. Data obtained to date indicate or suggest that 
cleaning and sterilization of these devices can be very difficult. The 
material properties and device performance can be affected by re-
sterilization. Changes in device performance that may result from 
resterilization are model specific and a general statement cannot be 
made for all of the device models in a given category. It has been 
noted that minor changes in a given model have been observed to have 
potentially substantial effects on the ability to reprocess. This 
information will be presented at the FDA/AAMI Conference on Reuse of 
Single Use Devices on May 5-6, 1999 in Crystal City, Virginia. These 
data will be considered carefully when FDA makes its decision on how to 
address the issue of reuse of single use devices.
    Question. Does reuse of these supposedly single-use medical devices 
put patients at risk?
    Answer. FDA is concerned that if a single use device is going to be 
reused, it must be done safely. FDA published a Compliance Policy 
Guide, CPG 300.500, several years ago that focused on hospital 
operations. That CPG stated that there is a lack of data to support the 
general reuse of single use devices. If an institution chooses to 
engage in this practice, the CPG stated that the hospital should 
demonstrate that the device can be adequately cleaned and sterilized; 
that the physical characteristics or quality of the device will not be 
adversely affected; and that the device remains safe and effective for 
its intended use. This CPG is still in effect. FDA is also conducting 
research to try to obtain data to answer the public health questions 
associated with reuse of single use devices.
    Question. What, if anything, do you intend to do about this issue?
    Answer. FDA is and will continue to use its mandatory and voluntary 
Medical Device Reporting Program to keep track of infections, injuries, 
and other adverse events reported by manufacturers and device users 
involving the reuse of single use devices. FDA is enlisting the 
cooperation of other organizations to obtain reuse experience data. FDA 
is currently working with the Health Care Financing Administration to 
include questions about device reuse during HFCA inspections of user 
facilities.
    Although FDA does not have specific information regarding the 
efficacy of these processes, it is evaluating reuse literature and 
information from equipment manufacturers and conducting research to 
gain additional knowledge of the effects of reprocessing on device 
materials.
    FDA is also assessing whether additional regulation or other 
attention to reprocessing is needed. At the May 5-6, 1999 FDA/AAMI 
conference, attention will be focused on regulatory and public health 
considerations regarding this practice. FDA will continue to work with 
groups represented at that conference to resolve outstanding issues and 
concerns and consider new regulatory approaches. One factor that needs 
to be carefully thought through are the costs and benefits of 
reprocessing on device users and patients.
    Question. Could you provide me with information about how the FDA 
sets its criteria for certain foods (such as breads, pastas, and cereal 
products) to be called ``enriched''?
    Answer. Historically, the addition of nutrients to foods has been 
undertaken as a public health measure to promote nutritional public 
health goals. The enrichment of white flour and bread, and other cereal 
grain products, has been an effective safeguard in improving the 
nutrient intake of the U.S. population and, therefore, preventing 
nutrient insufficiencies.
    Under Title 21 of the Code of Federal Regulations, Sec. 104.20 FDA 
sets forth its fortification policy and principles for the rational 
addition of nutrients to foods. FDA will provide for the record the 
criteria in these fortification guidelines that apply to ``enriched 
foods''.
    [The information follows:]
                             enriched foods
    (1) A nutrient(s) may be added to a food to correct a dietary 
insufficiency recognized by the scientific community to exist and known 
to result in nutritional deficiency disease.
    (2) A nutrient(s) may appropriately \1\ be added to a food to 
restore such nutrient(s) to a level(s) representative of the food prior 
to storage, handling, and processing (including milling and refining).
---------------------------------------------------------------------------
    \1\ A nutritient added to a food is appropriate only when the 
nutrient: a) is stable in the food under customery conditions of 
storage, distribution, and use, b) is physiologically available from 
the food, c) is present at a level at which there is a reasonable 
assurance that consumption of the food containing the added nutritient 
will not result in an excessive intake of the nutrient, considering 
cumulative amounts from other sources in the diet, and d) is suitable 
for its intended purpose and is in compliance with applicable 
provisions of the Federal Food, Drug, and Cosmetic Act and regulations 
governing the safety of substances in food.
---------------------------------------------------------------------------
    (3) A nutrient(s) may be added to a food in proportion to the total 
caloric content of the food, to balance the vitamin, mineral, and 
protein content.
    (4) A nutrient(s) may appropriately be added to a food that 
replaces traditional food in the diet to avoid nutritional inferiority.
    (5) A nutrient(s) may be added to foods as permitted or required by 
applicable regulations established elsewhere in Chapter I of Title 21.
    Question. As you may know, the Centers for Disease Control and 
Prevention recommends that women of childbearing age consume 400 
micrograms of folic acid daily to help prevent birth defects, yet I 
understand the FDA criteria for ``enriched'' foods only requires a 
substantially lower amount of folic acid to be present. Has FDA 
considered changing it's criteria for ``enriched'' foods to require 
more folic acid in these products?
    Answer. In establishing the levels of folic acid for the 
fortification program, FDA had to balance the competing factors of 
increasing the intakes of women of child-bearing age to a significant 
degree while not increasing the intakes of all gender and age groups to 
levels that could cause adverse effects. In dealing with these 
competing issues, FDA sought input from many sources. For example, FDA 
consulted frequently with other agencies in the Public Health Service, 
CDC and NIH, and held three public meetings with its Food Advisory 
Committee and an ad hoc Working Group. Also, the fortification 
regulations went through notice and comment rulemaking procedures. FDA 
considered all comments to the docket in finalizing this rulemaking.
    The fortification regulations became fully effective in January, 
1998. At this point, FDA is actively collaborating with other federal 
government agencies to monitor both the safety and effectiveness of the 
current folic acid fortification program. As new data become available 
and as the evidence supports the need for change, FDA, in consultations 
with other PHS agencies, will consider adjustments in its folic acid 
fortification program as supported by such evidence.
                                 ______
                                 
                Questions Submitted by Senator McConnell
                              tobacco rule
    Question In papers filed with the Fourth Circuit Court of Appeals, 
the FDA indicated that it would limit its activities to enforcing the 
minimum age restriction and identification requirement, pending review 
by the Supreme Court.
    In addition, you stated in your confirmation hearing that you would 
not expand on the youth access activities that were ongoing before the 
court's ruling. You also assured the House Agriculture Appropriations 
subcommittee that the FDA is not spending any money for any purpose 
beyond enforcing the minimum age and identification requirements.
    However, your budget justification indicates that in fiscal year 
2000, the FDA will begin to conduct activities related to product 
regulation.
    Your budget justification also indicates that the FDA plans to 
begin studying how to enforce the advertising and marketing provisions 
of the FDA rule that the Fourth Circuit and the District Court have 
invalidated. In fact, the FDA just published a Federal Register notice 
soliciting comment on the paperwork requirements that would be imposed 
by its advertising regulations.
    Question. A spending money beyond the enforcement of its minimum 
age regulations, despite your assurances to the Congress and to the 
Fourth Circuit Court of Appeals that the FDA would limit its activities 
to minimum age enforcement pending further court decisions or 
congressional action?
    Answer. The budget justification describes activities related to 
product regulation that are all within FDA's current legal authority. 
For example, the agency would allocate a limited amount of funds to 
begin to develop a scientific and regulatory framework to properly 
analyze issues posed by current and new tobacco products as well as by 
existing products for the treatment of nicotine dependence. This would 
include pursuing research issues raised by new or so called ``less 
hazardous'' nicotine delivery devices. It would also include continued 
assistance with other DHHS agencies to the Federal Trade Commission in 
the analysis of the public health issues raised by the testing and 
reporting of the tar and nicotine content of cigarette smoke.
    The recent Federal Register notice on agency information collection 
activities was a request for an extension, pursuant to the Paperwork 
Reduction Act of 1995, of the collection approved by the Office of 
Management and Budget, OMB in 1996. The 1996 OMB approval covered 
several reporting and recordkeeping provisions of the 1996 tobacco 
rule. Due to litigation, these provisions were not made effective, 
although the district court upheld some of the provisions. However, the 
litigation has not affected or suspended the expiration date for the 
OMB approval. Consequently, FDA requested an extension of the OMB 
approval because, in the event the regulations become effective, a 
valid OMB approval of the rule's information collection provisions is 
necessary for those provisions to be enforceable. If OMB approval 
expired and the regulations became effective, persons subject to the 
rule would not be required to respond to the information collection 
provisions, and those provisions would have no legal force and effect 
until the agency requested and received a new OMB approval. The request 
to renew OMB approval places no new burdens on the industry, and 
maintains the status quo for the regulations until the litigation is 
resolved. In addition, it is much less resource-demanding for the 
agency to request an extension of OMB approval than to let the approval 
expire and seek a new OMB approval after the litigation is resolved.
    Question. Do the FDA's contracts with the states regarding 
enforcement of the FDA's minimum age regulations permit the states to 
use such funds to enforce the states' own minimum age requirements?
    Answer. Under our contracts, states are permitted to use the 
results of FDA compliance checks as a basis for separately proceeding 
with enforcement action under comparable state laws. FDA funds cannot 
be used to enforce state law. Using their own funds, the states can use 
the results of our inspections to proceed under state law.
    Question. If not, what will happen to these funds if the Supreme 
Court affirms the Fourth Circuit's decision?
    Answer. It is premature to speculate about how the Supreme Court 
might rule in this case.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                           codex alimentarius
    Question. Since the WTO now uses Codex Alimentarius standards in 
the dispute resolution process, are the US. Government's efforts 
sufficiently funded to ensure that U.S. policies are adopted by Codex?
    Answer. While the FDA cannot respond on behalf of other U.S. 
Government agencies, FDA believes that increased funding for Codex 
activities would enhance U.S. efforts to ensure both public health and 
fair trade.
    The Codex mandate is to protect the health of consumers while 
ensuring fair trade practices. As the importance of Codex in setting 
standards that are recognized by the WTO grows, FDA must use a greater 
percentage of its base resources each year to prepare for and represent 
U.S. interests at critical Codex meetings. Further, as the number and 
complexity of Codex issues increase so also must FDA resources be 
expended on Codex increase. Today's efforts extend far beyond the 
presence at Codex Committee meetings. They involve substantial 
preparation for the increasingly complex technical issues, e.g., risk 
assessment and risk management, interagency discussions, attendance at 
many key Codex working group meetings, a very important increased 
involvement with non-governmental organizations, and an enhanced 
advocacy effort to obtain foreign government agreement with U.S. 
positions. These additional or enhanced responsibilities require 
adequate funding if they are to be done successfully. The current 
resources expended on Codex, in our judgement, are insufficient to 
adequately fulfill the needs that the U.S. Government now has with 
respect to Codex.
    Question. Does FDA currently have sufficient resources to fully 
participate in Codex meetings and proceedings?
    Answer. FDA does not have a defined budget for Codex activities. 
While the U.S. Codex Office, which has oversight over U.S. Codex 
activities, resides in the USDA Food Safety and Inspection Service, 
most of the Codex activities are decentralized throughout government 
agencies, including FDA. Since the beginnings of the Codex Alimentarius 
Commission in 1962, FDA has devoted considerable resources to ensuring 
that Codex international food standards reflect the level of safety and 
quality expected by the U.S. consumer. Currently FDA provides the U.S. 
Delegate or the Alternate Delegate to 13 of 16 Codex Committees; a 
portion of 39 individuals time approximately 11 FTE plus staff support, 
is involved with the work of Codex. Recognizing both the responsibility 
of FDA under the Food and Drug Administration Modernization Act of 
1997, FDAMA, and the increased importance and level and type of 
activities with Codex mentioned in Question 91, additional resources 
for Codex related activities would be beneficial. The new 
responsibilities with Codex, increased number and technical complexity 
of the Codex issues, the increased frequency of working group meetings, 
the need for increased communications with other U.S. governmental 
agencies and with non-governmental organizations on Codex issues, and 
the need to assist in advocacy efforts to help assure U.S. success on 
Codex issue, are all added responsibilities since the recent 1995 
advent of the WTO Trade Agreement with only a minimal addition of 
resources. Additional resources are needed to better enable FDA to 
properly carry out its Codex responsibilities.
                statutory review times--medical devices
    Question. Meeting statutory review times is a key element of the 
statute and one that I believe should be the agency's highest priority. 
Given the fact that user fees are not likely, what other ways do you 
intend to meet this statutory obligation?
    Answer. Meeting statutory review times is certainly among our 
highest priorities in promoting the public health. However, without 
additional resources, FDA is unlikely to be able to meet the statutory 
review times for non-user fee programs such as the device review 
program. While FDA will continue with its reengineering initiatives and 
the implementation of FDAMA, significant additional improvements in 
review times for the complex 510(k) applications and PMA applications 
are unlikely without additional funding. FDA will continue to redirect 
resources to high-risk, high-impact product areas where direct 
intervention helps consumers and health care professionals the most. 
FDA's direct involvement in some low-risk product areas will continue 
to be examined and acceptable alternatives to direct FDA involvement 
will be considered while ensuring that adequate consumer protection is 
maintained. In addition, FDA will continue to work with industry to 
encourage broader use of regulatory options like third party review for 
510(k)s, special and abbreviated 510(k)s, and product development 
protocols, PDPs.
    Question. Assuming that user fees are not enacted, how would you 
reallocate the $19 million, which has been requested in appropriations, 
to ensure that device reviews do not fall further behind?
    Answer. FDA's plans, as reflected in the Administration's proposed 
budget for fiscal year 2000, are to focus increased appropriated 
funding on injury reporting and product safety assurance activities. 
The appropriated increase requested in fiscal year 2000 reflects the 
Administration priority of restoring the balance between postmarket 
activities and review activities. Since the postmarket surveillance 
resources had been redirected to device review for the past several 
fiscal years, the fiscal year 2000 increase will be used to rebuild the 
postmarket portion of the program. In addition, the core budget for the 
medical device program has been relatively unchanged since fiscal year 
1995 despite increases in Federal pay and inflation. This has 
effectively decreased the purchasing power of the annual appropriations 
received by the device program by about 4--5 percent per year.
    FDA and the Administration believe that the requested budget 
increase for this program is necessary for the promotion and protection 
of the public health. FDA estimates that there may be as many as 
300,000 injuries and deaths per year associated with device use. FDA is 
requesting $3.2 million to implement the first phase of a National 
Sentinel Reporting Network that will keep FDA and the medical community 
better informed about device problems involving device misuse or user 
error. In addition, as devices become more complex and the device 
industry continues to grow domestically and internationally, it becomes 
increasingly critical for FDA to work towards achieving statutory 
timeframes for inspections and be in a position to enforce new 
standards for various products. Although with the requested increase of 
$15.8 million for product safety assurance for devices, FDA will 
improve product safety and quality systems conformance, the Agency 
still will not meet its inspectional statutory requirements. Since FDA 
has already reallocated declining resources from postmarket to review 
over the past several years, we cannot afford to do so in the future. 
FDA has estimated that it would take an additional $12.8 million to 
fully meet its statutory review obligations for 510(k)s, PMAs, and PMA 
supplements. Without the enactment of user fees, FDA will maintain 
fiscal year 1999 performance levels by continuing with its 
reengineering initiatives as well as continuing to redirect resources 
to high-risk, high-impact product areas where direct FDA intervention 
helps consumers and health care professionals the most.
    Question. You have announced that your number one priority is 
implementation of the letter and spirit of FDAMA. How do you justify a 
budget with no additional appropriated funds for one of FDA's most 
important functions medical device reviews?
    Answer. Through FDAMA, Congress and Agency stakeholders expect more 
timely and interactive PMA reviews. Accordingly, FDA's fiscal year 2000 
budget proposes to use these additive device user fees to significantly 
increase the effort devoted to PMA and PDP reviews, including enhancing 
the timeliness and quality of the review process as well as increasing 
interactions and consultations with industry. In addition, the user fee 
revenue will enable FDA to stay current with increasingly complex new 
technologies, update review standards and provide high quality, timely 
guidance to industry and reviewers. The medical device strategy is to 
concentrate resources on high risk, high impact products or work areas 
where they are likely to have the greatest impact on public health. 
With the proposed user fees, the percentage of reviews completed within 
established time frames will increase, average review times will go 
down, and the FDA will be able to support increased interaction with 
industry.
                          user fee legislation
    Question. You have stated that a consensus is needed among 
Congress, FDA, the industry and consumers before a user fee program 
will work. Yet, you have proposed a program with little detail and no 
proposed legislation. Why not go through more appropriate processes to 
open up this dialogue?
    Answer. Proposed legislation to authorize new user fees to enhance 
the quality and timeliness of premarket review of both direct and 
indirect food and color additives, and for medical devices is currently 
in clearance within the administration. The legislation is anticipated 
to be completed shortly and submitted to the appropriate committees in 
Congress. While we have not had any specific discussions with the 
authorizing committees about the proposed new fees in the fiscal year 
2000 budget, the Administration intends to initiate such discussions 
following submission of the requisite legislative proposals. These 
proposals will take into consideration the discussions held regarding 
previous proposals.
                        collaboration and fdama
    Question. Working with the regulated industry can often produce 
better products in a more efficient way. Since you have pledged to 
improve agency-industry relations, will you commit to reversing the 
FDAMA noncollaboration policy and encourage the use of agency-industry 
working groups to address key FDAMA implementation issues?
    Answer. FDA has no noncollaboration policy. In fact, the Agency has 
recognized the value of receiving input from its constituents before 
issuing guidance documents or regulations to implement FDAMA. Because 
of the very demanding statutory deadlines placed on the Agency, in the 
interest of time, the Agency has generally relied on the processes that 
it has in place, namely notice and comment rulemaking and Good Guidance 
Practices. At the same time, it has also recognized that there are 
times when it would be important to meet with outside groups to hear 
their views on implementation issues and to discuss drafts of FDAMA 
documents that were made available to the public at large. The Agency 
also has established public dockets for written comments related to 
specific FDAMA provisions and has specifically invited such comment. In 
addition, the Agency already has held a number of public meetings to 
discuss FDAMA implementation. These practices will continue to be 
available in the future.
    Question. Enactment of FDAMA was the first step in a process 
intended to change the culture at FDA. Essentially, the vision was to 
provide life-saving, life-enhancing products to patients quickly, 
efficiently and safely. Yet there are reports that front-line staffers 
have yet to be fully informed or fully trained in the full requirements 
of FDAMA. What steps do you intend to take to make the full promise of 
FDAMA a reality at your agency, especially with those staffers who deal 
most immediately with manufacturers?
    Answer. The Agency is fully committed to implementing FDAMA. Part 
of implementation includes ensuring that staff are adequately trained 
regarding the new law, and that provisions are being implemented 
consistently across the Agency. One of the most effective ways to do 
this is to develop guidance on different provisions that can be given 
to those both inside and outside the Agency. As you know, the Agency 
has already completed dozens of guidance documents, and will continue 
to do so. In addition, the Agency often holds training sessions with 
its staff in order to ensure consistent application of its regulations. 
For example, our Center for Devices has quarterly meetings to review 
past IDE decisions so that each division can hear from each other and 
work harder to develop a more consistent approach. Companies are 
allowed to ask for reconsideration of their IDEs at these meetings, in 
order to make this process very open and accommodating. We feel that 
these sort of training exercises are very helpful to increase the 
quality and consistency of our product reviews, and will continue them 
in the future. In addition, each Center has held training sessions 
specifically on FDAMA and its related issues.
    Question. The agency has not yet issued any guidance documents as 
promised in the November 18, 1998 final regulation implementing section 
404 of FDAMA. When will those guidance documents be issued?
    Answer. The FDA Center for Biologics Evaluation and Research, CBER, 
and the Center for Drug Evaluation and Research, CDER, published in 
accordance with the Good Guidance Practices, a Draft Guidance for 
Industry: Formal Dispute Resolution: Appeals Above the Division Level 
on March 19, 1999. This is presently a draft for comment. The Center 
for Veterinary Medicine, CVM, is in the process of issuing dispute 
resolution draft guidance that will contain a new procedure for 
resolving a scientific dispute. The CVM has had in place for some time, 
a procedure for the handling of an internal review of an appeal. This 
draft guidance will be issued for comment and finalized in a separate 
action following consideration of the comments. FDA's Center for 
Devices and Radiological Health, CDRH, is establishing new procedures 
for resolving scientific disputes which were published April 17, 1999, 
in a Federal Register notice announcing the availability of a draft 
guidance document, Resolving Scientific Disputes Concerning the 
Regulation of Medical Devices--An Administrative Procedures Guide to 
Use of the Medical Devices Dispute Resolution Panel (64 F.R. 22617). 
Comments on this proposed guidance are being accepted through July 26, 
1999. These documents can be accessed from FDA's home page at 
www.fda.gov. I would be happy to provide a list of the topics currently 
on that website by FDA center.
Center for Devices and Radiological Health
    General:
  --Guidance for Staff, Industry, and Third Parties Implementation of 
        Third Party Programs Under the FDA Modernization Act of 1997 
        (Issued 10/30/98)
  --List of Devices for Third Party Review Under the FDA Modernization 
        Act of 1997 (Updated 2/8/99)
  --List of Accredited Persons for 510(k) Review under the FDA 
        Modernization Act of 1997 (Updated 4/14/99)

    IDE/PMA/510(k) Related Documents:
  --Guidance for Industry General/Specific Intended Use (Issued 11/4/
        98)
  --Guidance to Industry Supplements to Approved Applications for Class 
        III Medical Devices: Use of Published Literature, Use of 
        Previously Submitted Materials, and Priority Review (Issued 5/
        20/98)
  --PMA/510(k) Expedited Review--Guidance for Industry and CDRH Staff 
        (Issued 3/20/98)
  --30-Day Notices and 135-Day PMA Supplements for Manufacturing Method 
        or Process Changes, Guidance for Industry and CDRH (Issued 2/
        19/98)
  --Determination of Intended Use for 510(k) Devices--Guidance for 
        Industry and CDRH Staff (Issued 1/30/98)
  --Procedures for Class II Device Exemptions from Premarket 
        Notification, Guidance for Industry and CDRH Staff (Issued 2/
        19/98)
  --New Section 513(f)(2)--Evaluation of Automatic Class III 
        Designation, Guidance for Industry and CDRH Staff (Issued 2/19/
        98)
  --Guidance on PMA Interactive Procedures for Day-100 Meetings and 
        Subsequent Deficiencies--for Use by CDRH and Industry (Issued 
        2/19/98)
  --Guidance on Amended Procedures for Advisory Panel Meetings (Issued 
        1/26/99)
  --Guidance on IDE Policies and Procedures (Issued 1/20/98)
  --Early Collaboration Meetings Under the FDA Modernization Act 
        (FDAMA), Guidance for Industry and CDRH Staff (Issued 2/19/98)

    Postmarket Surveillance /Device Tracking:
  --Guidance on Criteria and Approaches for Postmarket Surveillance 
        (Issued 11/2/98)
  --SMDA to FDAMA: Guidance on FDAs Transition Plan for Existing 
        Postmarket Surveillance Protocols (Issued 11/2/98)
  --Guidance On Procedures to Determine Application of Postmarket 
        Surveillance Strategies (Issued 2/19/98)
  --Guidance on Procedures for Review of Postmarket Surveillance 
        Submissions (Issued 2/19/98)
  --Guidance on Medical Device Tracking (Issued 2/99)

    Standards:
  --Guidance on the Recognition and Use of Consensus Standards (Issued 
        2/19/98)
  --FDA Recognized Consensus Standards Appendix A (Updated 9/98)[text]
  --Guidance on Frequently Asked Questions on Recognition of Consensus 
        Standards (Issued 12/21/98)
  --Opportunity to Recommend Standards for CDRH Recognition

    Other Documents:
  --Draft Guidance on Resolving Scientific Disputes Concerning the 
        Regulation of Medical Devices; Administrative Procedures on Use 
        of the Medical Devices Dispute Resolution Panel (Issued 4/27/
        99)
  --Related Document: Final Rule: Administrative Practices and 
        Procedures; Internal Review of Decisions (issued 11/18/98)
  --Medical Device Appeals and Complaints--Guidance on Dispute 
        Resolution (Issued 2/98)
  --FDA Modernization Act of 1997 Guidance for the Device Industry on 
        Implementation of Highest Priority Provisions (Issued 2/6/98)

Center for Drug Evaluation and Research
    General:
  --Classifying Resubmissions in Response to Action Letters (Issued 5/
        14/1998, Posted 5/14/1998)
  --Enforcement Policy During Implementation of Section 503A of the 
        Federal Food, Drug, and Cosmetic Act (Issued 11/1998, Posted 
        11/20/1998)
  --Fast Track Drug Development Programs--Designation, Development, and 
        Application Review (Issued 11/17/1998, Posted 11/17/1998)
  --Formal Dispute Resolution: Appeals Above the Division Level (Issued 
        3/1999, Posted 3/18/1999)
  --Formal Meetings With Sponsors and Applicants for PDUFA Products 
        (Issued 3/1999, Posted 3/18/1999)
  --Implementation of Section 120 of the Food and Drug Administration 
        Modernization Act of 1997-Advisory Committees (Issued 10/1998, 
        Posted 11/02/98)
  --Implementation of Section 126 of the Food and Drug Administration 
        Modernization Act of 1997--Elimination of Certain Labeling 
        Requirements (Revised 7/1998, Posted 7/20/98)
  --National Uniformity for Nonpresciption Drugs--Ingredient Listing 
        for OTC Drugs (Issued 4/1998, Posted 5/5/1998)
  --Providing Clinical Evidence of Effectiveness for Human Drug and 
        Biological Products (Issued 5/14/1998, Posted 5/14/1998)
  --Qualifying for Pediatric Exclusivity Under Section 505A of the 
        Federal Food, Drug and Cosmetic Act (Issued 6/29/1998, Posted 
        6/29/1998)
  --Repeal of Section 507 of the Federal Food, Drug and Cosmetic Act 
        (Revised 5/1998, Posted 6/12/1998)
  --Standards for Prompt Review of Efficacy Supplements (Issued 5/15/
        1998, Posted 5/15/1998)
  --Submission of Abbreviated Reports and Synopses in Support of 
        Marketing Applications (Issued 8/1998, Posted 9/15/98)
  --Submitting and Reviewing Complete Responses to Clinical Holds 
        (Issued 5/14/1998, Posted 5/14/1998)
  --Women and Minorities Guidance Requirements (Issued 7/20/1998, 
        Posted 11/25/1998)
Center for Biologics Evaluation and Research
    General:
  --Federal Register Notice: List of Documents Issued by the Food and 
        Drug Adminstration That Apply to Medical Devices Regulated by 
        CBER--4/26/99
  --Draft Guidance for Industry: Formal Dispute Resolution: Appeals 
        Above the Division Level--3/19/99
  --Draft Guidance for Industry: Formal Meetings With Sponsors and 
        Applicants for PDUFA Products--3/19/99
  --Guidance for Industry: Fast Track Drug Development Programs--
        Designation, Development, and Application Review--11/18/98
  --Guidance for Industry; Advisory Committees: Implementing Section 
        120 of the Food and Drug Administration Modernization Act of 
        1997--10/30/98
  --Draft Guidance for Industry: Developing Medical Imaging Drugs and 
        Biologics--10/14/98
  --Federal Register: Food and Drug Administration Modernization Act of 
        1997; Allergenic Patch Test Kits; Request for Comments or 
        Data--10/1/98
  --FEDERAL REGISTER Biological Products Regulated Under Section 351 of 
        the Public Health Service Act; Implementation of Biologics 
        License; Elimination of Establishment License and Product 
        License; Proposed Rule--7/31/98
  --Guidance for Industry: Implementation of Section 126, Elimination 
        of Certain Labeling Requirements of the Food and Drug 
        Administration Modernization Act of 1997--7/21/98
  --Guidance for Industry: Qualifying for Pediatric Exclusivity Under 
        Section 505A of the Federal Food, Drug and Cosmetic Act--6/98
  --FEDERAL REGISTER--Dissemination of Information on Unapproved/New 
        Uses for Marketed Drugs, Biologics and Devices; Proposed Rule--
        6/8/98
  --FEDERAL REGISTER Regulations for In Vivo Radiopharmaceuticals Used 
        for Diagnosis and Monitoring; Proposed Rule--5/22/98
  --Guidance for Industry: Providing Clinical Evidence of Effectiveness 
        for Human Drugs and Biological Products--5/15/98
  --Guidance for Industry: Standards for the Prompt Review of Efficacy 
        Supplements, Including Priority Efficacy Supplements--5/15/98
  --Guidance for Industry: Classifying Resubmissions in Response to 
        Action Letters--5/14/98
  --Guidance for Industry: Submitting and Reviewing Complete Responses 
        to Clinical Holds--5/14/98
    Question. What is the agency's legal reasoning for not using notice 
and comment rulemaking to establish these procedures?
    Answer. The Agency has taken the position that the current appeals 
procedures in place are adequate, and that is would be helpful to 
clarify that certain decisions may be taken to an advisory committee, 
at FDA's discretion. It was recommended that additional guidance would 
be helpful for industry, which is why the Agency agreed to issue 
guidance clarifying its current regulations.
    Question. Will they contain any new procedures for resolving 
scientific disputes?
    Answer. There have been several developments in this area that I 
would like to address more specifically in a document for the record:
                     Resolving Scientific Disputes
Center for Biologics Evaluation and Research
    The Center for Biologics Evaluation and Research (CBER )and the 
Center for Drug Evaluation and Research (CDER) have published, in 
accordance with the Good Guidance Practices, a Draft Guidance for 
Industry: Formal Dispute Resolution: Appeals Above the Division Level 
on 3/19/99. This is presently a draft for comment. The URL for this 
document is www.fda.gov/cber/gdlns/disputedft.pdf . This lays out the 
procedures that sponsors or applicants may use to request resolution of 
a dispute. It includes the procedures for requesting a review by an 
Advisory Committee under revised 21 CFR 10.75.
    CBER has also written and posted a Standard Operating Procedure for 
dispute resolution. It contains the internal procedures for CBER staff 
to follow. It is SOPP #8005--Major Dispute Resolution Process 
<8005.htm> and can be found on the internet atwww.fda.gov/cber/regsopp/
8005.htm .
    All of CBER's recent guidance documents explain the options for 
dispute resolution, including scientific disputes, usually by referring 
to the guidance document mentioned above.
Center for Drug Evaluation and Research
    There is draft guidance document entitled, ``Guidance for Industry: 
Formal Dispute Resolution: Appeals Above the Division Level'' available 
on the internet at www.fda.gov/cder/guidance/index.htm. This guidance 
document is intended to provide guidance for industry on procedures 
adopted by the Center for Drug Evaluation and Research (CDER) and the 
Center for Biologics Evaluation and Research (CBER) for resolving 
scientific disputes that cannot be resolved at the Division level.
    In addition, CDER's manual of policies and procedures includes a 
document entitled, ``Resolution of Disputes: Roles of Reviewers, 
Supervisors, and Management; Documenting Views and Findings and 
Resolving Differences.'' This document is also available on the 
internet (www.fda.gov/cder/mapp.htm). This document provides a general 
description of the roles of the reviewer, supervisors and team leaders, 
and management in arriving at institutional decisions in the drug 
application review process; guidance on how each individual involved in 
the scientific review process is to document his or her views or 
findings; and a procedure for resolving differences.
Center for Veterinary Medicine
    The Center for Veterinary Medicine (CVM) is in the process of 
issuing dispute resolution draft guidance that will contain a new 
procedure for resolving scientific disputes. The Center has had in 
place for some time, a procedure for the handling of internal review of 
appeals. The dispute resolution draft guidance will be issued for 
comment and finalized in a separate action following consideration of 
the comments. The draft guidance simplifies the existing procedures for 
the handling of a request for an internal review and describes the new 
procedure for a review of a scientific controversy by the advisory 
committee. These appeal procedures apply to a decision that affects 
animal drugs and other products regulated by the CVM.
Center for Devices and Radiological Health
    FDA's Center for Devices and Radiological Health (CDRH) is 
establishing new procedures for resolving scientific disputes. On April 
17, 1999, CDRH published a Federal Register notice announcing the 
availability of a draft guidance document, Resolving Scientific 
Disputes Concerning the Regulation of Medical Devices--An 
Administrative Procedures Guide to Use of the Medical Devices Dispute 
Resolution Panel (64 F.R. 22617). Comments on this proposed guidance 
are being accepted through July 26, 1999.
    To implement section 404 of FDAMA and to comply with 21 CFR 10.75, 
the center is proposing to establish a new Medical Devices Dispute 
Resolution Panel, which will operate under FDA's Medical Devices 
Advisory Committee. In addition to serving as a useful forum in which 
scientific disputes in general can be aired, the Dispute Resolution 
Panel would implement four provisions of the Federal Food, Drug, and 
Cosmetic Act:
  --Section 514(b)(5)(B) of the act requires the establishment of an 
        advisory committee to take referrals of any matter concerning 
        the establishment, amendment, or revocation of a performance 
        standard which requires the exercise of scientific judgment.
  --Section 515(g)(2)(B) of the act requires the establishment of an 
        advisory committee to take referrals of petitions for review 
        of: (a) the approval, denial, or withdrawal of approval of a 
        premarket approval application, or (b) the revocation of an 
        approved product development protocol (PDP), a declaration that 
        an approved PDP has not been completed, or a revocation of an 
        approved Notice of Completion that permitted marketing of a 
        device developed under a PDP.
  --Section 522(b) of the act, which was added by section 212 of FDAMA, 
        requires a process to resolve any disputes concerning the need 
        for FDA to order a manufacturer to conduct postmarket 
        surveillance for more than 36 months.
  --Section 562 of the act requires FDA to provide a procedure for 
        review of all scientific disputes regarding the regulation of 
        medical devices, including review by an appropriate scientific 
        advisory panel, but only to the extent that other provisions of 
        the act or FDA regulations do not already provide a right of 
        review.
    FDA believes its current procedures already provide methods to 
obtain review of most, if not all, scientific disputes. The 
establishment of the Dispute Resolution Panel provides an additional, 
more focused, procedure for the timely review of scientific disputes. 
This draft guidance document sets forth guidelines that will govern the 
operation of the Medical Devices Dispute Resolution Panel. Those 
guidelines include the appointment of a CDRH Ombudsman, who will be 
designated to receive, review, and make recommendations with respect to 
requests for review by the resolution panel. CDRH intends to ensure 
that a center ombudsman is in place before the final guidance goes into 
effect.
    Question. Why did the agency chose not to establish a stand-alone 
dispute resolution mechanism?
    Answer. The Agency felt that there were adequate dispute resolution 
mechanisms already in place, but that it would be helpful to clarify 
our regulations concerning the availability of advisory committees for 
certain types of appeals. This change has been finalized, and the 
Agency has issued guidance on this regulation. Therefore, a stand-alone 
mechanism was not necessary.
                                 ______
                                 
                  Questions Submitted by Senator Kohl
                       cost of prescription drugs
    Question. I hear from many constituents about the continuing 
increase in the cost of prescription drugs. In fact, I understand the 
problem of rising drug costs in the U.S. is among the most serious in 
the world.
    What is FDA doing to help control the rising price of prescription 
drugs.
    Answer. FDA plays an important, but indirect, role in helping 
control the price of prescription drugs. The agency carries out this 
role through the operation of a highly efficient and effective generic 
drug review process. As generic drugs are approved and enter the market 
place they reduce the cost of medication to the U.S. public.
    Question. To what extent is the approval of generic drugs slowing 
these rising costs and if it is significant, why is FDA not doing more 
to encourage the availability of generic drugs?
    Answer. Generic drugs reduce the cost of medication to the U.S. 
public when they enter the market place. If there are delays in the 
approval of the generic drugs beyond the patent and/or exclusivity 
period, then the U.S. public will not receive the full benefit of 
generic approvals.
    We believe that the key to encouraging the availability of generic 
drugs is increasing the number of chemistry, microbiology, 
bioequivalence, and labeling reviewers, as well as support staff within 
the Office of Generic Drugs. In addition, funding is needed for 
research to support the development of scientifically rigorous 
bioequivalence testing methodologies for nonsystemically absorbed drug 
products. The review and approval of such products are often subject to 
challenge by innovator firms. The stronger the scientific support of 
these approvals, the more likely it will be the Office can successfully 
meet innovator challenges. Additionally, increasing the quality of 
industry submissions--abbreviated new drug applications; accelerating 
implementation of the electronic submission initiative on an industry-
wide level; and increasing the level of training and professional 
development received by reviewers and review support staff would also 
help improve the availability of generic drugs.
                                 fdama
    Question. Please describe the progress at FDA in meeting the 
challenges of the recent FDA reform legislation.
    Answer. Published in November 1998, the FDA Plan for Statutory 
Compliance addresses requirements set forth in Section 406 of the FDA 
Modernization Act, FDAMA. This plan outlines the actions necessary to 
bridge the gap between what FDA is required to do by statute and what 
it is able to accomplish with current resource levels. The first 
official progress report will be issued in late 1999. However, the 
Agency is able to report on several accomplishments toward meeting the 
letter and intent of the legislation.
    As the first year anniversary of the enactment of FDAMA, the Agency 
had met nearly all of the deadlines for implementing the many varied 
provisions of the law. In many cases the agency was able to complete 
these initiatives well ahead of schedule. In April 1999 FDA convened a 
live, national teleconference for the purpose of discussing the 
Agency's progress in implementing FDAMA and to seek additional input on 
specific performance targets. Highlights showing FDA's progress in 
meeting challenges of the reform legislation are being posted on the 
FDA web site at http://www.fda.gov/opacom/7modact.html. We will provide 
selected examples for the record.
  --Biologics--FDA has issued over 50 guidance documents which will 
        assist industry in getting products to market more quickly 
        while continuing to ensure the same high level of safety and 
        efficacy.
  --Drugs--FDA has finalized the industry guidance for submission of 
        New Drug Applications in electronic form and posted it on FDA's 
        web site.
  --Devices and Radiologic Health--FDA has shifted resources from low-
        risk to high-risk products, and involved stakeholders earlier 
        during application review process.
  --Food Safety--FDA held public meetings on health claims and nutrient 
        content claims on foods based on authoritative statements, 
        including proposal to permit such health claims on dietary 
        supplements.
  --Veterinary Medicine--FDA is conducting research to determine if the 
        Agency can require fewer animal studies or reduce the number of 
        animals needed in studies to support certain new animal drug 
        applications.
    Question. How is it affecting the budget?
    Answer. The FDA reform legislation has drawn attention to the fact 
that current levels of funding are insufficient to meet the Agency's 
statutory obligations. Successful implementation of the FDA 
Modernization Act, FDAMA, depends on a commitment of resources focused 
on the Agency's overall public health and safety responsibilities. In 
light of the increasingly complex public health challenges facing the 
Agency in the 21st century, success will depend on innovative 
approaches by FDA, creative collaboration with stakeholders, 
prioritization of activities, and an adequate long-term resource 
investment to implement the necessary changes.
    The affect of this legislation on FDA's budget is somewhat unclear. 
Inflation has reduced the real resources available for certain FDA 
responsibilities delineated in FDAMA. These include inspections to 
ensure product safety; review of devices, food additives, blood 
products, animal drugs, and generic drugs; and adverse event reporting 
and follow-up. Statutory requirements for new product review times and 
for inspectional coverage are not being met in all areas, due in part 
to budgetary limitations. Preparing and executing the budget, 
therefore, challenges the Agency to applying its strategic decision 
framework that focuses on the highest priority commitments.
    Question. In what ways does FDA plan to restructure the agency to 
meet these challenges?
    Answer. The FDA Modernization Act, FDAMA, defines the Agency's new 
mission. In that mission, Congress indicates not only the regulatory 
and public health responsibilities of FDA, but also the manner in which 
those roles are carried out. One key statement in the mission is that 
the Agency shall carry out its responsibilities, ``in consultation with 
experts in science, medicine, and public health, and in cooperation 
with consumers, users, manufacturers, importers, packers, distributors, 
and retailers of regulated products.''
    With this in mind, several changes have been planned. The newly 
reorganized Office of the Commissioner, OC, will have as its principal 
focus to provide leadership in building effective, two-way 
communication between FDA and all stakeholders including: patients, 
consumers, Congress, the Administration, Agency employees, the 
regulated industry, health care professionals, and other scientific 
advisors. The OC will retain only those staff functions which cannot be 
reasonably and more effectively performed in those centers or offices 
that interface most directly with stakeholders. Other short-term 
changes will address a growing emphasis on international policy and 
activities, women's health, consumer issues, and systems improvement.
    The emphasis of FDAMA on the involvement of stakeholders is 
changing the manner in which restructuring decisions can be made. As we 
compile the suggestions of our constituents, strategies for enhancing 
FDA's effectiveness as a scientific, regulatory agency will become more 
evident. Subsequent decisions regarding organizational structure will 
be made as appropriate for the Agency within the context of the rapidly 
changing national and global environment.
    Question. Would you please comment on these reports and the obvious 
challenges of moving quickly, but not too quickly?
    Answer. Although the FDA process is faster, every application is 
reviewed thoroughly and completely. In addition, the FDA standards for 
approval, which include how many patients must be studied in clinical 
trials and what benefits must be demonstrated, have not changed. 
Available evidence shows that shortened review times under the 
Prescription Drug User Fee Act Program have not led to less safe 
products being approved for marketing.
    None of the U.S. safety withdrawals over the last 18 years, 13 of 
which were drugs, involved drugs that underwent particularly fast 
reviews. In fact, the fastest of these reviews was for the drug 
mibefradil which took 15 months--well above the current average review 
time under user fee performance goals. Many drugs are reviewed faster. 
A forthcoming article in a peer reviewed medical journal will provide a 
thorough analysis of new drug safety withdrawals showing them to be 
unrelated to approval time or approval year.
                              bioterrorism
    Question. Please explain FDA's role in the administration's Anti-
Bio Terrorism policies.
    Answer. FDA has a primary role in creating and maintaining a 
stockpile of pharmaceuticals and biological products and furthering 
research, design, development and approval of diagnostics, antibiotics, 
therapeutics and vaccines to be used to prevent and treat the exposure 
to deadly chemical and biological agents. This is an integral component 
of the Department of Health and Human Services' overall responsibility 
is to meet the Nation's public health and medical needs associated with 
terrorist events. The President's fiscal year 2000 budget for DHHS 
contains a request for $230 million for these purposes. The FDA, CDC, 
NIH, Substance Abuse and Mental Health Services Administration, and 
Office of Emergency Preparedness, working closely with the Department 
of Defense and the Department of Veterans Affairs have developed a 
four-pronged approach to prepare for and respond to a biological or 
chemical attack. The four priorities include revamping the public 
health surveillance system; strengthening our medical response 
capability; creating and maintaining a stockpile of pharmaceuticals and 
biological products; and enhancing research, design, development and 
approval of diagnostics, antibiotics, therapeutics and vaccines. FDA' s 
counter-bioterrorism initiative focuses on the priorities for creating 
and maintaining a stockpile of pharmaceuticals and biological products, 
and furthering research, design, development and approval of 
diagnostics, antibiotics, therapeutics and vaccines. I would like to 
provide additional information for the record.
                        bioterrorism initiative
FDA's Stockpile Responsibility
    FDA is responsible for ensuring the safety, purity, and potency of 
biological products intended for use in the diagnosis, treatment, 
prevention, or cure of diseases or conditions resulting from exposure 
of the American people to these deadly biological and chemical agents 
in this country or on foreign. FDA must evaluate the safety and 
effectiveness of these products prior to their release to the public. 
In addition, FDA must continue to ensure the safety and efficacy of 
these products through the inspection of manufacturing facilities for 
compliance with regulations, verification that product lots conform to 
preapproval standards and product consistency prior to their release 
into distribution, and evaluation of surveillance reports, such as 
adverse experience reports.
    The release of a biological weapon, producing mass civilian or 
military casualties, will create a public health crisis in the United 
States requiring extraordinarily large amounts of antibiotics, 
antivirals and vaccines for treating those who become ill or for 
protecting those who may have been exposed. If such products are 
unapproved, FDA must be prepared to review them quickly and efficiently 
to assure their safety and efficacy. In addition, FDA will play a role 
in establishing any needed requirements for critical pharmaceutical 
supplies to be available to these biowarfare victims in less than 24 
hours. This requires FDA to identify the biological or chemical agents 
that present the greatest threats, estimate the potential size of the 
population that may be affected, determine the best prophylaxis or 
treatment options, and then decide how best to assure immediate access 
to sufficient quantities.
    The proposed stockpile would assure an immediately available 
quantity of appropriate pharmaceutical and biological products that 
would meet the needs of the affected population in the event of the 
release of a chemical or biological weapon. The need for a stockpile at 
several strategic locations around the United States is based on the 
fact that some pharmaceutical products, required exclusively during a 
biological or chemical weapon attack, would not otherwise be available 
on a timely basis and in sufficient quantity. Normally these products 
are not found in the marketplace in adequate amounts to meet a mass 
casualty need and production lead times may be too long if there is a 
bioterrorism incident. The products in this type of stockpile, however, 
require careful monitoring for potency and sterility and will have to 
be replaced from time to time.
Research and Development
    FDA is actively working on the interagency group to identify the 
agents that pose the greatest threat, to outline the current 
capabilities to deal with these agents, and to identify the goals and 
research needs necessary to respond to a potential bioterrorist attack 
using these agents.
    In order to facilitate the development, approval, and continued 
safety and efficacy of the products, FDA scientists must plan and 
conduct research on the methods of testing safety, purity, potency, and 
efficacy of these products. The public health of the United States 
cannot risk the wide distribution of products that are unsafe. Based on 
their research, FDA scientists will be able to develop industry-wide 
testing techniques, standards and methods; to improve existing 
products; and promote the development of new products. FDA needs to 
conduct research regarding the agents that bioterrorists may use in 
order to further understand the agents and the effect they will have on 
humans who are exposed to them and to have a better understanding of 
the proposed treatments when FDA reviews applications.
    Terrorist events involving biological agents will be very different 
in character from those employing chemical agents. Moreover, 
preparedness for and response to an attack involving biological agents 
are complicated by the large number of potential agents, most of which 
are rarely encountered naturally, their sometimes long incubation 
periods and consequent delayed onset of disease, and the potential for 
secondary transmission. In addition to naturally occurring pathogens, 
agents used by bioterrorists may be genetically engineered to resist 
current therapies and evade vaccine-induced immunity.
    A research program to counter bioterrorism must address disease 
priorities, with initial emphasis on microbes such as smallpox and 
anthrax. For the longer term, research must target agents and diseases 
such as Ebola virus, brucellosis, plague, turalemia, viral 
encephalitides, viral hemorrhagic fevers and botulism. While current 
research programs are understandably focused on a few microbes that 
have the greatest potential for use as a weapon of mass destruction, in 
the future, additional research programs must address other potential 
microbial agents of bioterrorism.
    A research program to produce vaccines and therapeutics for 
biological weapons faces the challenge of not being able to proceed 
with human Phase III efficacy clinical trials. Given ethical and safety 
concerns that would rule out infecting human subjects with a deadly 
organism in order to test a vaccine or therapeutic, trials with humans 
cannot be undertaken. Therefore, the regulatory process for approval of 
treatments or preventative medicines and diagnostics may need to be 
modified to permit the emergency use of antibiotics/therapeutics and 
vaccines that have been shown to be safe and efficacious in animal 
models. FDA has drafted a proposed rule to allow animal data to be 
used.
    Since it is likely that an intentional release of a bioweapon will 
become apparent in the form of a disease outbreak, emphasis must also 
be placed on the development, evaluation and approval of rapid 
diagnostics. The ability to rapidly identify and characterize a 
suspected biological agent will permit speedy treatment and/or 
prophylaxis. The rapid diagnostic technologies to be developed should 
be capable of detecting known biological agents as well as genetically 
engineered organisms.
    FDA's proposed activities and corresponding outcomes include:

    Activities:
  --Research and review activities related to expeditious development 
        and licensure of new vaccines and therapeutics;
  --Timely application reviews of new drugs and biological products and 
        new uses of existing products;
  --Participation in the planning and coordination of public health and 
        medical response to a terrorist attack involving a biological 
        or chemical agent;
  --Participation in the development of rapid detection and 
        decontamination tests for agents of bioterrorism such as C. 
        botulinum, E. coli, B. Anthracis;
  --Assuring the safety of regulated foods, drugs, medical devices and 
        biological products; and arranging for seizure and disposal of 
        affected products;
  --Development of techniques to detect genetic modifications of micro-
        organisms which make them more toxic or resistant to 
        antibiotics or vaccines;
  --Rapid determination of a microbes sensitivity to drug therapy;
  --Rapid determination of the mechanism of replication and 
        pathogenicity/virulence of organisms, including those elements 
        which can be transferred to other organisms in order to 
        circumvent detection, prevention or treatment;
  --Enhanced ADR surveillance capabilities.

    Outcomes:
  --Safe and efficient products to prevent, either prior to or 
        subsequent to exposure, and treat toxicity of biological and 
        chemical agents;
  --Methods to rapidly detect, identify and decontaminate hazardous 
        organisms;
  --Increased ability to ensure the safety of the food supply;
  --Increased ability to provide appropriate medical care and a public 
        health response.
                          field consolidation
    Question. Please explain the status of FDA field consolidation and 
the budgetary impact of those actions.
    Answer. FDA began this initiative in 1994 with approval from the 
Secretary of Health and Human Services to proceed with streamlining 
field laboratories. The Agency was unable to maintain eighteen field 
laboratories due to rising rent and maintenance costs, overcrowding, 
and inadequate and obsolete laboratory space. Many leases for 
facilities built to FDA specifications in the 1960's were expiring. 
Faced with the prospect of acquiring new and more expensive replacement 
leases for special purpose laboratory space, the plan to focus and 
consolidate shrinking resources evolved. Nine of eighteen field 
laboratories will be closed, with staff and functions consolidated. 
Five large multi-purpose laboratories in New York; Atlanta; Jefferson, 
Arkansas; Seattle; and Los Angeles; and four smaller specialty 
laboratories in San Juan; Winchester, Massachusetts; Cincinnati; and 
Philadelphia will house the FDA field analytical science activities. 
Savings in estimated rent, maintenance and utilities from the start of 
the project in 1994 through 2014 are estimated to be in excess of $90 
million. FDA will maintain its inspection, investigation, and 
compliance presence in all locations where laboratories are closed.
    In 1997, laboratories were closed in Chicago, Buffalo and 
Cincinnati. In 1998 the laboratory in New Orleans was closed. The 
Baltimore laboratory will close in 1999; and, Dallas, Detroit and 
Minneapolis laboratories will close in 2000.
    The new FDA field multi-purpose laboratory at NCTR in Jefferson, 
Arkansas is under construction with occupancy expected in December 
1999. With a partial appropriation of $3 million in fiscal year 1999, 
FDA has recently awarded a contract to begin the third and final phase 
of the project, the renovation of Building 50 at NCTR, which will house 
joint ORA and NCTR administrative and support staff and services. $10.3 
million will complete phase III; $3 million is requested in fiscal year 
2000.
    In 1995, $9.8 million was appropriated to FDA for land acquisition 
and design for the new laboratory and district office facility in Los 
Angeles. Land was purchased on the campus of the University of 
California at Irvine, and design is virtually complete. The fiscal year 
2000 request includes $20.4 million, which is approximately one-half of 
the $40.4 million needed to complete construction of this much needed 
multi-purpose laboratory facility.
    A new laboratory annex to the existing facility in Atlanta came on 
line last spring, and the facility is fully operational. The multi-
purpose laboratory in Atlanta is complete and has been accepting 
additional staff from closing laboratories.
    A new multi-purpose laboratory and office facility in Jamaica, 
Queens, New York, to be leased through GSA, is well underway with an 
expected occupancy in January 2000.
    FDA has recently renovated the drug specialty laboratory in San 
Juan; expanded the drug specialty laboratory in Philadelphia; and, 
moved into a new facility in Cincinnati which houses the district 
office and the National Forensic Chemistry Center.
    Question. As you are aware, I am concerned about the rising cost of 
drugs. I am also supportive of the goals of the Orphan Drug Act and the 
benefits it provides for people with rare disorders. However, concerns 
have been raised that implementation of the Act, in some instances, has 
had the effect of stifling competition and, ultimately, raising drug 
costs to consumers. Specifically, these concerns focus on those cases 
in which the exclusivity of one drug has expired, yet competition is 
still not allowed if there is another similar drug for which 
exclusivity is still in effect.
    Commissioner Henney, please review and report to me on the 
implementation of the Orphan Drug Act in terms of the exclusivity rule 
and the effect it is having on competition in the market place and the 
ultimate cost to consumers.
    Answer. The 7-year exclusive marketing period after approval for a 
designated orphan product is one of the most meaningful incentives of 
the Orphan Drug Act. As of May 1, 1999, 189 orphan products have been 
marketed over the last 16 years. This exclusivity, like patent terms, 
restricts competition intentionally. Orphan drug exclusivity provides 
an additional economic incentive for sponsors to invest in the research 
and development for what are generally limited patient groups and 
markets. Many orphan products have no other source or basis for 
intellectual property protection. The exclusivity bar does not preclude 
products which show either greater efficacy or safety from being 
approved by FDA. FDA does not maintain nor have access to economic, 
pricing, or other financial data for these or any other regulated 
products. A premise of the orphan products program is that the most 
costly product is one that is neither known nor available when needed. 
FDA believes that consumers are served best when a proven safe and 
efficacious treatment is marketed and available when needed. In many 
cases, an orphan product displaces other restrictive and more costly 
care and improves the quality of life for the patient and affected 
family.
                                 ______
                                 
                 Questions Submitted by Senator Harkin
                        otc sunscreen monograph
    Question. ``Skin cancer is a serious public health problem in the 
United States, and regular use of sunscreen is considered an important 
element of sun protection. The FDA Modernization Act requires that FDA 
publish regulations for OTC sunscreens. In addition, Congress 
specifically directed FDA to address the review of foreign sunscreen 
ingredients as part of the OTC sunscreen monograph.
    ``Would you discuss how FDA is proceeding with this monograph, and 
what sort of timeline you foresee for its publication?''
    Answer. A final sunscreen monograph published was in the Federal 
Register on May 21, 1999, (64 FR 2766). The Agency addressed the 
process for including sunscreen active ingredients based solely on 
foreign data and marketing experience in Comment 13 of the preamble to 
the final rule.
                            tobacco funding
    Question. Would you please describe in more detail what share of 
the money appropriated for the FDA initiative against youth smoking 
goes out to state authorities for their use in carrying out compliance 
checks and any other smoking prevention activity?
    Answer. In 1997, $2 million (out of $4.9 million) went to state 
contracts to enforce the rule. In 1998, $16.4 million went to state 
contracts. In 1999, the Agency has allocated $22 million towards state 
contracts.
    Question. Please describe in a more detailed breakdown just how the 
funding for this initiative is used, that is, the types of activities 
that are supported, how the money is distributed among these 
activities, and how the money is apportioned between federal and state 
level activities.
    Answer. In fiscal year 1997, FDA designed a pilot program and 
infrastructure to enforce the rule. The Agency, consistent with its 
practices in other areas, determined that it would commission state and 
local officials to enforce the federal rule--specifically to conduct 
unannounced visits to retailers using adolescents younger than 18, who 
would attempt to purchase cigarettes or smokeless tobacco. Initially, 
the Agency contracted for enforcement in 10 states. In fiscal year 
1997, contracts were awarded to Florida, Illinois, Washington, Texas, 
Massachusetts, Colorado, Pennsylvania, Minnesota, Arkansas, and 
California. These states were required to conduct approximately 200 to 
400 inspections per month. Compliance checks began in the first state 
in August 1997. These contracts resulted in approximately 20,000 
compliance checks during the 10 month pilot program.
    In fiscal year 1998, the Agency expanded its enforcement efforts 
and solicited bids from all 57 states and territories to contract with 
FDA to do compliance checks. By the close of fiscal year 1998, FDA had 
signed contracts with 43 states and territories totaling $16,382,912. 
Under these contracts, the states will conduct approximately 186,500 
compliance checks by September 30, 1999. The average contract is 
approximately $390,000. With the signing of each new contract, FDA's 
headquarters or regional staff trains the designated state and local 
officials. Headquarter staff has also spent countless hours answering 
questions from tobacco retailers and providing technical assistance to 
the states.
    All 10 states who participated in the pilot program, renegotiated 
contracts to continue doing compliance checks in their states. In at 
least two states, the programs had been so successful that the states 
chose to expand the initial limited coverage provided by the first 
contract. In Arkansas, for example, the pilot contract provided for 
compliance checks to be conducted only in and around Little Rock. 
Similarly, in Colorado, only a few counties were included in the 
original contract. In both cases, the subsequent contracts 
substantially increased the areas of the state that would be included 
in the investigations.
    The existing contracts resulted in 39,439 attempted and completed 
compliance checks during fiscal year 1998, including reinspection of 
retailers found to have violated the rule. The Agency's legal staff 
devised and established the framework for the imposition of civil money 
penalties, sent out complaints, and negotiated or litigated contested 
cases. In fiscal year 1998, FDA began seeking civil money penalties 
from those found to have violated the rule's restrictions on sales to 
minors for a second time. In fiscal year 1999, FDA began investigations 
of retailers who have been found to have already violated the rule two 
times. The agency anticipates seeking civil money penalties for third 
violations within the first quarter of fiscal year 1999. A penalty 
schedule for violations of other portions of the regulation will be 
developed when these provisions go into effect.
    In the second half of fiscal year 1998, the Agency contracted with 
Battelle Memorial Institute to study the tobacco program's business 
processes, outline the program's work flow and conduct a requirements 
analysis. From this requirements analysis, Battelle proposed a system 
design to automate the program's processes. In addition, Battelle 
presented a proposed plan to obtain and maintain a list of retailers 
selling tobacco in each state that would be more complete, accurate and 
user friendly than the lists constructed by the Agency during its first 
full year of operation.
    Based on the design, Battelle has launched a multi-year effort to 
provide reliable retailer lists and an infrastructure designed to 
maintain the list and make it user friendly for FDA and for all 
contracting states. Battelle will also design and implement an 
information technology system which will automate all the program's 
various functions, including contracting, outreach, enforcement, 
compliance checks, litigation, collection of civil money penalties, 
etc. The new system will increase the efficiency of the program and 
will improve communications internally as well as with state 
contractors and with other stakeholders. The various system design 
components will be implemented incrementally as they are developed 
beginning in early 1999. The entire system should be operational by 
2001. The amount dedicated to this multi-year project in fiscal year 
1998 is $2.8 million.
    In fiscal year 1998, the Agency designed a comprehensive outreach 
program designed to inform retailers and ensure compliance. This multi-
faceted program consisted of advertising, direct mail, press events and 
materials, exhibits and speeches, and dissemination of materials 
requested via a hotline or mail order.
    In fiscal year 1998, the Agency designed a multi-media advertising 
campaign, including radio, print, and billboard advertising. A free 
retailer kit using humorous illustrations and a folksy approach also 
was created to make it easier for retailers to comply with the new 
regulation. A series of focus group discussions were held with 
retailers, sales clerks, young people between 18 and 27, children ages 
12 to 18, and the general public to test the advertising campaign and 
retailer kits. During fiscal year 1998, approximately 500,000 retailers 
kits were produced and sent to stores across the country.
    The FDA conducted a tracking study in 10 media markets to evaluate 
the effectiveness of the campaign. Findings indicate that awareness of 
the photo identification age provision rose dramatically from 
approximately one-third of retailers to more than one-half of all 
retailers. In addition, there was a three-fold increase in recall of 
the fine for repeat violations in the test markets. Further, in test 
markets, twice as many clerks used 27 as the cut-off age after the 
campaign compared to before the campaign. Importantly, retailers 
reported that minors were somewhat less likely to try to buy tobacco 
and retailers said that customers were less likely to be irritated when 
asked to show photo identification as a result of the advertising 
campaign. By the close of fiscal year 1998, the Agency had obligated 
approximately $12.5 million for outreach activities. This covers the 
costs of the paid advertising campaign as well as the printing and 
dissemination of nearly a half million retailer kits.
    In 1997, $2 million (out of $4.9 million) went to state contracts 
to enforce the rule. In 1998, $16.4 million went to state contracts. In 
1999, the Agency has allocated $22 million towards state contracts.
                       supreme court and tobacco
    Question. What is FDA's response to the Supreme Court's granting of 
certiorari to review the Fourth Circuit case?
    Answer. The Administration stated on the day of the Supreme Court 
announcement that it was pleased that the Court has agreed to hear this 
important public health case.
    Question. It is my understanding that FDA retains full authority 
pending the Supreme Court decision to carry out the photo I.D. and 
minimum age rules, in cooperation with its state partners. Is that 
correct?
    Answer. Yes, pending the outcome of the Supreme Court's 
consideration of this case on the merits, FDA continues to have the 
authority to enforce the age and photo ID provisions of the tobacco 
rule.
    Question. Given the history of the tobacco industry in marketing 
tobacco products to young people, and frankly in not being truthful 
about so many of its activities, does it not make sense that the 
industry should provide at least some of the resources needed to carry 
out the efforts of FDA and its state partners to prevent kids from 
taking up smoking? For example, under the Prescription Drug User Fee 
Act, an industry regulated by FDA provides some of the resources for 
FDA activities.
    Answer. Funding via industry user fees is not contained in the 
Administration's fiscal year 2000 budget request for FDA's tobacco 
program.
    Question. Now, the situation regarding tobacco is not exactly the 
same, of course, but it seems there is an even stronger case in many 
respects for having the tobacco industry support FDA activities than 
there is for prescription drug user fees. What is FDA's position on 
obtaining resources from the tobacco industry to support FDA smoking 
prevention efforts?
    Answer. Funding via industry user fees is not contained in the 
administration's fiscal year 2000 budget request for FDA's tobacco 
program.
                                 ______
                                 
                 Questions Submitted by Senator Dorgan
                           prescription drugs
    Question. As the FDA Commissioner knows, U.S. consumers pay on 
average 30-60 percent more for the exact same medications than 
consumers in Canada, the United Kingdom, and Sweden. Part of the reason 
for this is that federal law and regulation have essentially created a 
closed market for prescription drug manufacturers.
    What are the statutory barriers to allowing free trade of 
prescription drugs?
    Answer. Under the Federal Food, Drug, and Cosmetic Act, the Food 
and Drug Administration must approve all new drugs, including 
prescription drugs, before they may be commercially distributed in the 
United States. This review function performed by FDA provides an 
essential protection to the health of the American people by helping 
ensure that the drug products that are available are safe and effective 
for their intended use. To obtain approval, the sponsor of a drug, 
usually the manufacturer, must submit sufficient information to the 
agency in the form of either a new drug application for innovator drugs 
that are not generic equivalents of currently marketed drugs or an 
abbreviated new drug application for generic equivalents of currently 
marketed drugs. Information that must be included in the application 
includes the chemical composition of the active chemical entity, the 
identity and composition of excipients and other inactive ingredients, 
and information concerning the place and methods of manufacture. On the 
basis of that application, as well as information obtained through 
inspections, FDA reviewers determine whether the drug is safe and 
effective for a particular use. If a sponsor does not file a new drug 
application with FDA, FDA cannot approve the drug, and the drug cannot 
be commercially distributed in the United States. A limited exception 
to the prohibition on distribution of unapproved new drugs exists to 
permit non-commercial distributions of unapproved new drugs intended 
solely for investigational use by experts qualified by scientific 
training and experience to investigate the safety and effectiveness of 
drugs.
    One provision of the Prescription Drug Marketing Act, Public Law 
100-293 Sec.  2(4), which was incorporated into the Federal Food, Drug, 
and Cosmetic Act, may also affect the importation of approved drugs. 
Congress enacted this provision pursuant to its finding that, ``Large 
amounts of drugs are being reimported to the United States as American 
goods returned. These imports are a health and safety risk to American 
consumers because they may have become subpotent or adulterated during 
foreign handling and shipping.'' Accordingly, Congress passed 21 U.S.C. 
Sec.  381(d)(1), which prohibits the reimportation of a prescription 
drug or insulin that was manufactured in the United States, and 
exported, unless the drug is reimported by the manufacturer of the drug 
or FDA authorizes reimportation of the drug for emergency medical care.
    Finally, other provisions of the Federal Food, Drug, and Cosmetic 
Act which prohibit the distribution of adulterated or misbranded drugs, 
could act to deny admission to certain entries of prescription drugs, 
depending on the condition of the drugs.
    Question. What barriers exist in FDA's statute to prohibit 
pharmacies from purchasing pharmaceuticals in other countries when 
those products are approved for sale in the U.S. and produced at FDA-
certified facilities?
    Answer. The Federal Food, Drug, and Cosmetic Act does not prohibit 
the purchase of approved prescription drugs in other countries. 
However, one provision of the Prescription Drug Marketing Act, which 
was incorporated into the Federal Food, Drug, and Cosmetic Act, may 
affect the subsequent importation of approved prescription drugs, if 
those drugs were originally manufactured in the United States. This 
provision, 21 U.S.C. Sec.  381(d)(1), prohibits the reimportation of a 
prescription drug or insulin that was manufactured in the United States 
and exported, unless the drug is reimported by the manufacturer of the 
drug or FDA authorizes reimportation of the drug for emergency medical 
care.
                     importation prescription drugs
    Question. During a recent meeting with Deputy Commissioner Michael 
Friedman, he identified 3 barriers that prevent consumers and 
pharmacists from importing prescription drugs from other countries to 
take advantage of lower prices: 1) GATT, which prevents the U.S. from 
treating its trading partners differently; 2) the Prescription Drug 
Marketing Act, which permits only pharmaceutical manufacturers to re-
import their drugs into the U.S.; and 3) the Federal Food, Drug and 
Cosmetic Act, which requires the FDA to ensure that drugs are made 
using good manufacturing practices.
    Can the FDA Commissioner recommend what changes could be made in 
the law to facilitate the importation of FDA-approved prescription 
drugs without undermining the public's safety?
    Answer. The first and third items discussed above might act as 
barriers to the importation of prescription drugs that are not 
manufactured pursuant to an FDA-approved new drug application and, 
therefore, not in compliance with the Federal Food, Drug, and Cosmetic 
Act. However, they are not likely to have an impact on the importation 
of prescription drugs manufactured pursuant to an FDA-approved new drug 
application.
    With regard to item 1, GATT and other United States trade 
agreements limit the United States' ability to distinguish arbitrarily 
among its trading partners. For example, if the United States were to 
put to the side all other legal concerns, including concern with 
compliance with the Federal Food, Drug, and Cosmetic Act, and decided 
to allow the importation of unapproved drugs manufactured in Country A, 
but to disallow the importation of unapproved drugs manufactured in 
Country B, the United States might be accused of making an arbitrary 
distinction between Country A and Country B. This concern is not 
relevant when the United States decides to allow the importation of 
approved drugs from Country A, but to disallow the importation of 
unapproved drugs from Country B. That distinction is on its face a 
reasonable one, based on the laws of this country designed to assure 
public health and safety.
    With regard to item 3, the Federal Food, Drug, and Cosmetic Act 
requires all manufacturers, processors, packers and holders of drugs to 
conduct their operations in conformity with current good manufacturing 
practice. All United States manufacturers, and all foreign 
manufacturers who manufacture drugs pursuant to approved new drug 
applications, are required to adhere to current good manufacturing 
practice. Neither the Federal Food, Drug, and Cosmetic Act, nor the 
regulations promulgated thereunder, attribute to approved prescription 
drugs that have traveled outside the United States a presumption that 
the drugs were, or were not, handled in accordance with current good 
manufacturing practices. All such determinations would be based on the 
individual circumstances surrounding the handling of the drugs. 
However, when drugs are handled outside the United States, we have very 
little information regarding handling conditions. A concern about poor 
handling during extended foreign shipments of drugs manufactured in the 
United States led to the passage of a provision of the Prescription 
Drug Marketing Act, PDMA. The PDMA provision, 21 U.S.C. Sec.  
381(d)(1), could impede the importation by a consumer of FDA-approved 
prescription drugs because it prohibits the reimportation of a 
prescription drug or insulin that was manufactured in the United 
States, and exported, unless the drug is reimported by the manufacturer 
of the drug or FDA authorizes reimportation of the drug for emergency 
medical care. In passing this legislation, Congress expressly found, 
``Large amounts of drugs are being reimported to the United States as 
American goods returned. These imports are a health and safety risk to 
American consumers because they may have become subpotent or 
adulterated during foreign handling and shipping.'' Public Law 100-293 
Sec.  2(4). FDA has also concluded that this provision provides greater 
assurance that recalls of prescription drug products will be conducted 
effectively. For example, if a manufacturer's records indicate that a 
drug has been distributed in Asia, not the United States, the 
manufacturer will provide all recall notifications to entities in Asia. 
United States consumers may hear nothing about the recall.
    You have asked FDA to recommend changes to this provision that 
would facilitate the importation of FDA-approved prescription drugs 
without undermining the public's safety. However, FDA believes that 
this provision affords the public an important safeguard. As part of 
the FDA Modernization Act of 1997, Congress recently amended section 
381(d)(1) to include insulin, a non-prescription drug, within the 
prohibition on reimportation. FDA supported that extension because 
insulin is temperature sensitive and requires refrigeration. Adverse 
storage conditions during international transport could cause the drug 
to become subpotent, could compromise the stability of the drug, or 
could cause physical changes in the drug, such as precipitation and 
clumping. Any of these changes could affect the effectiveness of the 
insulin dose administered to a diabetic patient.
    These concerns apply also to prescription drugs, since handling and 
storage conditions can affect the effectiveness of all drugs 
encompassed by 21 U.S.C. Sec.  381(d)(1).
    Question. The Prescription Drug Marketing Act of 1987 prohibits the 
re-importation of drugs produced in the United States to this country 
by anyone other than its manufacturer. I understand that the policy 
goals of this law were to prevent the counterfeiting, mislabeling, or 
adulteration of drugs sold to American consumers.
    Are there other ways to achieve these same goals without curtailing 
competition?
    Answer. The agency lacks the economic expertise to analyze the 
effect on competition of this law, or alternative formulations. 
Moreover, the agency does not have data on the volume of prescription 
drugs that are manufactured in the United States in accordance with an 
approved new drug application, but distributed outside the United 
States.
                              fsi funding
    Question. The budget request includes funding for the Food Safety 
Initiative in the amount of $79 million, including an increase of $30 
million and 156 FTEs. Can you describe in more detail how funds will be 
used to develop a food safety net?
    Answer. The $79 million is a total for the Food Safety Initiative 
and includes the $24 million increase in fiscal year 1998, the $25 
million increase in fiscal year 1999, and the $30 million request for 
fiscal year 2000. I would be happy to proved additional information for 
the record.
Performance Goals for the Food Safety Program
    Funding for the Food Safety Initiative will be used to develop a 
food safety net based on the following:
  --The performance goals for the Food Safety Program represent major 
        milestones in FDA's efforts to achieve significant improvements 
        in the safety of the Nation's food supply.
  --Each of the performance goals is tied to one or more of the six 
        elements identified in the President's Food Safety Initiative 
        as being critical to efforts to improve the safety of the 
        Nation's food supply. These six elements are improved foodborne 
        disease surveillance, improved interagency coordination on 
        responses to foodborne illness outbreaks, increased food safety 
        education, improved compliance monitoring, effective risk 
        assessment techniques for microbial pathogens, and improved 
        techniques for pathogen detection, control and prevention. 
        Moreover, the activities reflected in the performance goals are 
        designed to help the Agency improve its ability to address food 
        safety issues that currently pose significant threats to the 
        health and well being of American consumers. These threats 
        include emerging pathogens, bacterial toxins contamination, 
        poor food handling practices in the home and retail 
        establishments, and uninspected imported foods, especially 
        fresh fruits and vegetables. By the year 2001 it is expected 
        that data generated by foodborne disease surveillance will be 
        adequate to establish baselines against which FDA and other 
        federal agencies can begin to assess the impact that their 
        programs are having on reducing the number of foodborne 
        illnesses that occur annually.
  --Additionally, benefits gained in terms of improving the safety of 
        the food supply from NARMS in the past are multiple: NARMS has 
        made contributions to food safety when CDC provided information 
        to public health departments on the presence, in specific areas 
        of the country, of Salmonella typhimurium DT104, a multi-drug 
        resistant pathogen identified by NARMS; the NARMS report has 
        been utilized by food animal producers to identify problems 
        associated with drug resistance in some food animal 
        populations; NARMS has also been a source of well characterized 
        isolates from food animals for researchers developing rapid 
        assays to identify human pathogens in food, such as the 
        Salmonella typhimurium DT104 rapid assay announced by the 
        Secretary of the Department of Agriculture. Benefits to be 
        gained in the future in terms of improving the safety of the 
        food supply from increasing the numbers of isolates tested in 
        NARMS are: 1) an increased ability to detect outbreaks of food-
        borne disease early in an outbreak and earlier recall of 
        adulterated products preventing exposure of larger proportions 
        of the population, 2) improved ability to identify the source 
        of resistant human food-borne pathogens, 3) improved 
        characterization of the magnitude and type of resistance in 
        food animal populations to be used in policy development and 
        risk assessments and 4) improved capability to determine the 
        magnitude of resistance transfer in food-borne pathogens.
  --The research conducted will facilitate our ability to determine the 
        contribution of animal feeds to the development of antibiotic 
        resistance in food-producing animals. Information strategies 
        can be developed to reduce the level of pathogens in animals 
        feeds, thereby reducing the exposure of food-producing animals 
        to pathogens and will provide the basis for the development of 
        strategies to reduce the pathogen load in food-producing 
        animals, which contributes to the persistence of resistance 
        pathogens.
    Question. How does this program compliment and support the 
recommendations of the President's Council on Food Safety/National 
Academy of Sciences Report to develop a comprehensive national food 
safety plan?
    Answer. I would be happy to describe this compliment for the 
record.
    In the May 1997 report--``Food Safety From Farm to Table: A 
National Food Safety Initiative'', the food safety agencies made a 
commitment to prepare a 5-year comprehensive strategic plan, with the 
participation of all concerned parties. On August 24, 1998, President 
Clinton signed an Executive Order to create the President's Council on 
Food Safety, giving the responsibility for the development of a 
comprehensive strategic plan for federal food safety activities to the 
Council. The Council will develop a comprehensive plan to improve the 
safety of the nation's food supply by establishing a science-based food 
safety system. The plan will address the steps necessary to achieve 
this improved system, focusing on key public health, resources, and 
management issues that include measurable outcome goals.
    The National Academy of Sciences report, ``Ensuring Safe Food From 
Production to Consumption,'' made the following recommendations. 
Following each recommendation is a statement indicating how FDA is 
already involved in addressing these concerns.
  --Recommendation One: The food safety system should be based on 
        science. FDA provides numerous examples where this is already 
        the case, including the development and implementation of the 
        FoodNet and PulseNet systems for surveillance and 
        identification of foodborne pathogens and the implementation of 
        new science-based inspections of seafood. FDA has also 
        identified areas that should be strengthened such as improving 
        the ability to assess health risks from pathogens in food.
  --Recommendation Two: Federal statutes should be based on 
        scientifically supportable risks to public health. The 
        President's Council on Food Safety, of which FDA is a part of, 
        will call on Congress to work with it to create scientifically-
        based statutes to promote food safety. The Council will conduct 
        a thorough review of existing statutes and determine what can 
        be accomplished with existing regulatory flexibility and what 
        improvements will require statutory changes.
  --Recommendation Three: A comprehensive national food safety plan 
        should be developed. The first steps to lay the groundwork have 
        already been taken, the food safety agencies have participated 
        in interagency strategic planning sessions and drafted a vision 
        statement encompassing the agencies' vision for the U.S. food 
        safety system and the roles of all those involved in food 
        safety.
  --Recommendation Four: A new statute should be enacted that 
        establishes a unified framework for food safety programs with a 
        single official with control over all federal food safety 
        resources. The Council supports the goal of a unified framework 
        for food safety programs and will conduct an assessment of 
        structural models and other mechanisms to strengthen the 
        federal food safety system through better coordination, 
        planning, and resource allocation.
  --Recommendation Five: Agencies should work more effectively with 
        partners in state and local governments.
    The Council, of which FDA is a part, held four public meetings 
(October--December 1998) to engage consumers, producers, industry, food 
service providers, retailers, health professionals, State and Local 
governments, Tribes, academia, and the public in the strategic planning 
process.
    The base of the Food Safety Program encompasses Surveillance, 
Research, Risk Assessment and Education. This base lays and strengthens 
a strong scientific foundation for a nationally integrated food safety 
system. The system begins with identifying pathogenic microorganisms in 
animals, conducting HACCP surveillance activities at slaughter 
facilities, and monitoring activities to prevent or contain outbreaks 
of food-borne illness. Antimicrobial resistance fits into all aspects 
of the foundation--surveillance, research, risk assessment and 
education due to the use of antibiotics in food-producing animals for 
therapy and growth promotion purposes. The Animal Drugs and Feeds 
portion of FSI focuses on developing and expanding the National 
Antimicrobial Resistance Monitoring System (NARMS) as a surveillance 
tool that will enable us to detect emerging resistance and take 
appropriate public health action in response. This will allow us to 
target education on proper use of antimicrobials, conduct research to 
develop a better understanding of the mechanisms of the transfer of 
antibiotic resistance among bacteria, and carry out risk assessment to 
identify the level of antibiotic resistance that poses public health 
risk and to direct resources to minimize those risks.
    The Food and Drug Administration is in constant communication with 
other federal food safety agencies to ensure that proper surveillance 
and research activities are being undertaken and to reduce the level of 
duplication to a minimum. NARMS, which was established in January 1996, 
is a collaborative effort among the FDA, USDA, and CDC which was 
initiated in response to public health issues associated with the 
approval of fluoroquinolone products for use in poultry. We also work 
very closely with USDA on research related activities. Scientists from 
USDA were actively involved with the development of our research plans, 
in large measure to avoid duplication of effort. In addition, 
scientists from FDA participated in the planning activities of these 
same agencies. This process has continued to keep the other agencies 
apprised of our ongoing activities as well as their activities, explore 
areas for collaborative research efforts, and be able to respond to 
changing research needs and priorities.
    Question. Explain in detail your partnerships with Federal and 
state departments of agriculture and health on food safety.
    Answer. A national, rapid, effective response to foodborne illness 
outbreaks requires a coordinated effort that crosses agency lines, 
while recognizing the unique statutory responsibilities of each 
federal, state, and local agency involved. This requires agreement 
about roles and responsibilities of public health officials at all 
levels and the most expeditious manner of operating within those 
parameters in responding to outbreaks, collecting epidemiologic data, 
and quickly initiating traceback investigations.
    From the outset of the President's Food Safety Initiative, the 
Administration has recognized the need for strengthening partnerships 
between Federal agencies and State and local public health agencies. In 
the first two years of the Food Safety Initiative, additional funds 
were provided to improve coordination between all agencies involved in 
the food safety system. Within the framework of the initiative, 
additional funds helped establish the successful working relationships 
for implementing FoodNet, PulseNet, NARMS, Foodborne Outbreak Response 
Coordinating Group-FORC-G-, the Risk Assessment Consortium, and the 
Partnership for Food Safety Education. In addition, Food Safety 
Initiative funds have enabled food safety agencies to provide training 
and materials to State and local agencies for expanding and improving 
their on-going inspection and compliance capabilities, food safety 
education efforts, and foodborne illness surveillance capabilities.
    Great progress has also been made by cooperative Federal agencies 
in implementing HACCP systems for seafood, meat, and poultry and a 
comprehensive initiative for ensuring the safety of fruits and 
vegetables. Other efforts include the coordination of activities for 
ensuring the safety of food during transportation and at the retail 
level. These are complex issues involving numerous Federal, State, and 
local officials. The partnerships established and strengthened under 
the President's Food Safety Initiative have contributed to the ability 
of Federal food safety agencies to leverage resources, avoid 
duplication, and provide the basis for an integrated and seamless food 
safety system. Additional partnerships will be formed with the states 
to increase the number of high risk, non-meat and poultry, food 
inspections and to enhance the capabilities of states to improve food 
safety at the retail level.
    In September, 1998, representatives of food safety agencies from 
all 50 states, Puerto Rico, and the District of Columbia met with HHS 
and USDA in Kansas City to discuss how federal, state, and local food 
safety activities could be better integrated to provide a more 
effective and efficient food safety system. The State representatives 
strongly support the concept of a nationally integrated food safety 
system building on the current Federal-State partnerships. The 2000 
budget proposal includes funds for HHS, with USDA, to accelerate their 
planning with the states, including opportunities for public input, so 
as to be fully prepared to begin implementing such a system. To further 
foster progress toward a seamless, science-based food safety system, 
the 2000 budget includes funds to enable USDA and HHS to develop 
stronger ties with State food safety agencies.
    USDA is currently providing the training and equipment necessary 
for State personnel in the 25 State meat and poultry inspection 
programs to assure that State programs implement meat and poultry HACCP 
requirements that are `at least equal to' the Federal program of 
continuous inspection. Providing the 25 State meat and poultry 
inspection programs access to Federal computer networks will facilitate 
the coordination of inspection coverage between the two programs and 
ensure a consistent approach to inspection and an efficient allocation 
of resources. In addition, legislation will be proposed to authorize 
the Secretary of Agriculture to enter into Federal-State cooperative 
agreements that provide for State meat and poultry inspection programs 
to enforce Federal meat and poultry inspection laws and regulations 
with their State as part of a seamless national inspection program. 
Products shipped under such new Federal-State cooperative agreements 
would be permitted to enter interstate commerce.
    Another major aspect of the 2000 budget proposal is to 
significantly increase HHS efforts to coordinate its Federal inspection 
responsibilities with State and local agencies. Through grants, 
contracts, and other mechanisms, FDA will utilize State-conducted 
inspections to increase the frequency of coverage for domestic firms. 
With the additional resources, HHS estimates that a combination of 
Federal and State inspectors will be able to reduce the existing 
inspection cycle from once seven years for any particular establishment 
to a risk-based approach that enable highest risk operation to be 
inspected once a year.
    Encouraging the use of preventive control measures, such as HACCP 
and the Food Code, by the retail food industry will be the third major 
focus of cooperative federal-state activity. HHS and USDA, have worked, 
through the Conference for Food Protection, a forum for all 
stakeholders to have input into the code development process, with the 
states to promote use of safe practices in retail food operations and 
adoption of Food Code provisions, including HACCP. The Food Code is a 
model that provides scientifically sound technical and legal basis for 
regulating the retail segment of the food industry. It is the Federal 
government's best advice on a comprehensive system of regulation to 
ensure food in restaurants, retail food stores and institutional 
establishments is safe.
    The target audience of the Food Code is the 75 State and 
territorial agencies and over 3,000 local agencies directly regulating 
over one million retail operations. In fiscal year 2000, the agencies 
will continue to work with and provide training, assistance, and 
resources to improve the safety of food products at retail.
    DHHS, with the assistance of USDA, will also work cooperatively 
with foreign governments to evaluate foreign food production and 
inspection systems. Under the initiative, DHHS and USDA will increase 
the number of international arrangements for assuring food safety to 
facilitate the mutual understanding of the risks associated with 
foreign products, exclusive of meat and poultry, and the control 
measures necessary to reduce those risks. FDA will also follow-up on 
foodborne illness outbreaks associated with imported products and work 
toward equivalence determinations for other countries.
    FDA in collaboration with CDC and USDA established and is expanding 
the National Antimicrobial Resistance Monitoring System, NARMS, to 
detect potential hazards through systematic collection, analysis and 
interpretation of antimicrobial susceptibility surveillance data. 
Seventeen state and local health departments, including CA, CO, CT, FL, 
GA, KS, Los Angeles County, MA, MD, MN, NJ, New York City, NY, OR, TN, 
WA, and WV, submit human clinical isolates of non-typhoid Salmonella 
and E. coli and began submitting human S. typhi and Shigella isolates 
in January 1999. Campylobacter isolates are submitted by eight health 
departments and, in addition, MN, GA, MD and OR are submitting 
Campylobacter isolates from poultry retail samples. A pilot study 
involving these four states to monitor the resistance of human and 
poultry Enterococcus isolates to 27 antimicrobials began in 1998. Three 
veterinary sentinel sties were recently added to NARMS in the states of 
CA, WA, and NY. In addition, our Office of Research serves as a 
PULSENET laboratory, collaborating with the USDA laboratory at Athens, 
GA on Campylobacter samples and collaborating with USDA on molecular 
identification of Salmonella samples.
    FDA provided USDA with a list of priorities for research funding by 
USDA. This is based on the fiscal year 1999 Appropriation directive 
that directs the USDA to consult with FDA regarding food safety 
research objectives of that agency and recommends that $5M of the funds 
provided for the food safety component of the National Research 
Initiative, USDA, be used to meet those needs.
    FDA plans to develop an international database with WHO for food-
borne organisms and susceptibility patterns, if funding will allow, to 
share information globally that will improve our ability to detect 
emerging pathogens and their resistance patterns.
    Question. Part of the increase requested is to expand educational 
activities in preventing food borne illness for fruits and vegetables 
and seafood. In addition, FDA admits scientific knowledge in this area 
is lagging.
    How will the requested increase be used to minimize food borne 
illness associated with fresh produce including seafood? How will the 
requested increase be used to minimize food borne illness associated 
with fresh produce including seafood?
    Answer. Regarding fresh produce, we have determined that the most 
effective mechanism to promote use of the voluntary guidance is through 
education and outreach efforts by FDA and USDA. Efforts will be 
directed to growers and producers who supply produce to the U.S. market 
and be developed in cooperation with industry groups, state and foreign 
governments and trade organizations.
    While we are not always able to identify the specific cause of 
contamination in many cases of foodborne illness, in most cases we know 
the potential sources of pathogens and can take steps to protect public 
health with regard to those sources. The guidance is based on current 
sound science and knowledge of the common pathways for pathogens on 
fresh produce, which include manure, water, workers, field sanitation, 
packinghouses, and transport operations. The guidance recommends well-
accepted methods to minimize the potential for microbial contamination 
of fresh produce.
    In addition, FDA and USDA are jointly accelerating the research 
outlined in the fiscal year 1998 President's Food Safety Initiative, to 
develop new technologies to more rapidly identify and eliminate or 
reduce levels of pathogens; developing research-based educational 
programs targeting producers, processors, handlers, and consumers; and 
assisting in providing guidance and procedures to reduce or eliminate 
contaminants; and with FAS, providing technical assistance to foreign 
countries, where appropriate, to improve the safety of their products.
    Question. How does FDA propose to implement educational programs on 
production and processing for domestic and international producers to 
protect the public from food borne illness?
    Answer. In order to develop credible and useful education programs, 
FDA is meeting with both domestic and foreign growers and producers of 
fresh fruits and vegetables to begin the process for determining how to 
develop an education and outreach program to address the Good 
Agricultural Practices ``Guide to Minimize Microbial Food Safety 
Hazards for Fresh Fruits and Vegetables.'' A National Food Safety 
Science and Education Conference was called for in the February 1998 
``Initiative to Ensure the Safety of Imported and Domestic Fruits and 
Vegetables: Status Report to the President.'' In April 1999, two 
workshops were held. The first was geared toward growers and producers 
of fresh fruits and vegetables grown in the United States. The goals of 
the workshop were to enhance the coalition building process for those 
involved in implementing the ``Guide''; determine education and 
outreach needs of growers and producers and the most effective and 
efficient methods of meeting those needs; identify research needs in 
support of implementation of the ``Guide.''
    Attendees included extension specialists, growers, producers, 
buyers, processors, distributors, trade organizations, state and 
federal regulators, and educators who are involved in growing, 
harvesting, processing and transporting fresh fruits and vegetables.
    The focus of the second conference, designed to harmonize with the 
domestic conference, began the process of determining how to develop an 
education and outreach program for growers and producers of fresh fruit 
and vegetables imported into the United States. Foreign and domestic 
scientific experts, foreign government agriculture and health 
officials, and industry representatives discussed applications of the 
guide. Representatives from donor organizations addressed 
infrastructure improvements needed to enhance food safety. Participants 
addressing goals similar to the domestic workshop, also identified key 
elements for a base training model on good agricultural practices for 
fresh produce and called for an alliance of government, industry and 
academia to address these training needs. An analysis of information 
gleaned from both conferences is currently underway and ``next steps'' 
are being determined.
    On another front, a grant has been provided for development of a 
domestic curriculum covering the ``Guide,'' which will serve as a basic 
core component course. Efforts are also underway to begin a database of 
available courses to be housed at the FDA/USDA Foodborne Illness 
Education Information Center at the National Agricultural Library.
    Question. How many outbreaks of food borne illness have occurred to 
date this year as compared to last year?
    Answer. We will provide a chart for the record with the information 
we have been able to obtain.
    [The information follows:]

                                                             OUTBREAKS OF FOOD BORNE ILLNESS
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        No. ill/     Number lab
                                      State         Onset date range  hospitalized   confirmed        Vehicle             Agent         Source comments
--------------------------------------------------------------------------------------------------------------------------------------------------------
Salmonella Anatum in Orange     FL...............  Mid Jan--early              4/?            4  Fresh Squeezed     Salmonella Anatum  Nokomis Groves
 Juice.                                             Mar.                                          Unpasteurized                         (retail) No IS.
                                                                                                  Orange Juice.
Salmonella Thompson...........  CA...............  Late Feb--Late            >60/?      ( \1\ )  Unknown..........  Salmonella         Possible Mexican
                                                    Mar.                                                             Thompson.          Restaurant
                                                                                                                                        connection.
WIC program Infant Formula-     FL...............  Feb-present......           ?/?            0  Infant Formula...  Unknown Samples    Nestle Carnation
 Vomiting, projectile                                                                                                being analyzed     Many lots
 vomiting, and diarrhea.                                                                                             for B. cereus      suspect.
                                                                                                                     and Staph toxin,
                                                                                                                     & Chemical
                                                                                                                     Screen.
Chinese Restaurant-Salmonella   CA...............  Jan 99...........           ?/?            ?  Suspect Eggs.....  Salmonella         Isolate(s)
 Enteriditis.                                                                                                        Enteriditis.       confirmed as PT
                                                                                                                                        4 and sent to
                                                                                                                                        CDC.
Party in Maryland-Salmonella..  MD (party).......  Apr 17...........          25/?           12  Chicken salad....  Salmonella.......  Same caterer in
                                                                                                                                        Delaware for all
                                                                                                                                        3 events.
                                MD (church)......  Apr 16...........          2+/?            2  .................  Group D..........  .................
Group D.......................  DE...............  Apr 17...........           1/?            1  .................  (not confirmed     Same caterer in
                                                                                                                     Enteriditis yet).  Delaware for all
                                                                                                                                        3 events.
Infant Formula-Enterobacte r    FL...............  Apr/May?.........           1/1            ?  Similac with Iron  Enteroba cter      Unknown where
 Sakazaki..                                                                                                          Sakazaki.          organism
                                                                                                                                        isolated from
                                                                                                                                        (patient, pro-
                                                                                                                                        duct), FDA
                                                                                                                                        sample to be
                                                                                                                                        collected.
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Unknown.

                                 ______
                                 
                Questions Submitted by Senator Feinstein
                          microbial resistance
    Question. What is the FDA's position on the proposal to ban or 
phase out the use antibiotics in animals if the same drugs are used by 
humans?
    Answer. FDA is engaged in discussions to resolve questions about 
appropriate uses of antibiotics, and the Agency is very concerned about 
the ever-expanding antibiotic resistance in organisms that cause 
illness in humans. Our draft framework document, ``Proposed Framework 
for Evaluating and Assuring the Human Safety of the Microbial Effects 
of Antimicrobial New Animal Drugs Intended for Use in Food-Producing 
Animals'', sets out a conceptual risk-based process for evaluating the 
microbial safety of antimicrobial drugs intended for use in food-
producing animals. This document has been released to the public and 
has been the subject of a great deal of appropriate public debate.
    FDA has the authority under Section 512 of the Federal Food, Drug, 
and Cosmetic Act to withdraw approval of applications of new animal 
drug products, including antimicrobials, when certain conditions are 
met such as drugs shown to be unsafe under approved conditions of use. 
Sponsors of applications for such products must be given an opportunity 
for a hearing on the proposed withdrawal. Section 512 also gives FDA 
the authority to suspend an approval if the Secretary finds the drug 
poses an imminent hazard to the health of man or animals. In such 
cases, sponsors must be given an opportunity for an expedited hearing 
on the suspension. That section also gives FDA the authority to 
withdraw an approval through a notice-and-comment rulemaking process.
    If FDA suspends or withdraws an approval, any product covered by 
the suspension or withdrawal that is subsequently offered for sale is 
considered adulterated and subject to seizure or other remedies.
    Question. If the U.S. were to ban the animal use of antibiotics, 
what would be the impact on the price and quality of meat and poultry 
available for consumption?
    Answer. For FDA to ban growth promoting antibiotics by withdrawing 
all current approvals would require the Notice of Opportunity of 
Hearing process. This process could take 3-5 years, if the process 
proceeds on a similar timeframe for previous withdrawals, hopefully 
giving the industry time to develop alternatives. A definitive answer 
would require a market analysis. In the absence of such an analysis, 
however, we estimate that the impact on price and quality would be 
minimal because of the time available for industry to develop 
alternatives.
    Question. This proposal forces companies to prove that there is no 
risk to human health before new antibiotics are approved for animal 
usage. What steps is the FDA taking to address human resistance to 
existing antibiotics being used in livestock feed?
    Answer. FDA's proposed framework document specifies that currently 
approved antimicrobials for food-producing animals will be addressed on 
a risk prioritized basis. Thus, if the framework is implemented FDA 
would place highest priority on evaluating those currently approved 
drugs that are classified Category I, those that are the same as or 
closely related to human antimicrobial drugs that are essential for 
treating a life-threatening disease or important for treating a food 
borne illness.
    FDA has the authority under Section 512 of the Federal Food, Drug, 
and Cosmetic Act to withdraw approval of applications of new animal 
drug products, including antimicrobials, when certain conditions are 
met, such as drugs shown to be unsafe under approved conditions of use. 
Sponsors of applications for such products must be given an opportunity 
for a hearing on the proposed withdrawal. Section 512 also gives FDA 
the authority to suspend an approval if the Secretary finds the drug 
poses an imminent hazard to the health of man or animals. In such 
cases, sponsors must be given an opportunity for an expedited hearing 
on the suspension. That section also gives FDA the authority to 
withdraw an approval through a notice-and-comment rulemaking process.
    Question. The proposal is currently in the ``discussion'' phase. 
What is your time frame to formally propose these guidelines and when 
do believe it can be implemented?
    Answer. Based upon the increasing evidence that therapeutic and 
non-feed uses of antimicrobials in food-producing animals may select 
for resistant bacteria of public health concern, in November 1998, the 
Agency announced new guidance, number 78 in this area. The Agency 
stated that FDA now believes it is necessary to evaluate the human 
health impact of the antimicrobial effects associated with all uses of 
all classes of antimicrobial new animal drugs intended for use in food-
producing animals. Following the publication of this guidance, the 
Agency developed another document entitled, ``A Proposed Framework for 
Evaluating and Assuring the Human Safety of the Microbial Effects of 
Antimicrobial New Animal Drugs Intended for Use in Food-Producing 
Animals''. This document outlines proposed microbiological safety 
assessments for all food animal uses of antimicrobials but categorizes 
requirements based upon public health risks associated with the product 
use. It is imperative that FDA institute the principles outlined in the 
framework document as soon as possible to control the public health 
hazard from development of resistance in food-borne pathogens and their 
transfer to humans. Based on the comments received to the framework 
document, the Agency intends to revise guidance number 78 as soon as 
possible. FDA intends to provide the industry with guidance on how to 
conduct pre-approval studies which can be used to predict the 
development of resistance in food-borne pathogens.
    The key component of FDA's overall strategy on antimicrobial 
resistance is a national surveillance program that monitors resistance 
among enteric pathogens in both animals and humans. This has already 
been implemented. In 1996, the FDA, the Centers for Disease Control and 
Prevention and the U.S. Department of Agriculture established the 
National Antimicrobial Resistance Monitoring System: Enteric Bacteria, 
NARMS, to prospectively monitor changes in antimicrobial 
susceptibilities of zoonotic enteric pathogens from human and animal 
clinical specimens, from healthy farm animals, and from carcasses of 
food-producing animals at slaughter.
                         electronic submissions
    Question. It is my understanding that the FDA is considering 
allowing applicants to electronically submit for approval drug labeling 
information. This would appear to significantly accelerate the approval 
process.
    Is that true? If so, what is the status?
    Answer. The initiative to enable electronic submission of New Drug 
Applications, or NDAs, began in August 1997--the effective date of the 
FDA's Electronic Records; Electronic Signatures rule, 21 CFR Part 11. 
In September 1997, CDER published the first edition of guidance 
enabling applicants to submit electronic patient Case Report 
Tabulations, CRTs and Case Report Forms, CRFs CRTs and CRFs represent 2 
of 18 sections of an application and normally comprise 60-75 percent of 
the entire volume of a paper NDA. In January 1999, CDER published a 
second edition of ``Guidance for Industry--Providing Regulatory 
Submissions in Electronic Format--NDAs'' which enabled applicants to 
submit almost the entire NDA, including product labeling, in electronic 
format.
    Since the inception of the electronic NDA program in September 
1997, CDER has received the equivalent of over 10 million pages of NDA 
information in electronic format.
    The electronic NDA program is the initial phase of a larger 
initiative within FDA called ``Electronic Regulatory Submissions and 
Review'', ERSR. The goal of the ERSR initiative is to develop processes 
to enable the electronic submission and review of all regulatory 
documents submitted to CDER by 2002. In addition to NDAs, it is 
expected that the electronic submission of many other types of 
regulatory filings will be enabled including Post Marketing Adverse 
Experience Reports, Investigational New Drug Applications, and Drug 
Master Files.
    Question. If such a program were implemented, how much time and 
personnel could be saved and moved to other operations?
    Answer. At the present time, the submission of electronic NDA 
information instead of paper filing, including product labeling, is 
voluntary. Our experience thus far shows us that electronic submissions 
have been favorably accepted by the drug industry. The number of 
electronic submissions versus paper submissions continues to rise and 
we expect this trend to continue as we continue to expand the program 
to include additional submission types.
    It is tempting to focus on the potential for electronic NDAs to 
create cost savings and the opportunity to reprogram resources to other 
operations. But while we do expect cost savings, at this time the 
primary driving force behind the Electronic Regulatory Submissions and 
Review or ERSR program is to contain the historically growing costs to 
manage and store the volume of paper we receive, and, more importantly, 
to help reduce review time for important new drugs and make them 
available to the public without lowering the high standards of safety 
and effectiveness the public expects. CDER has been very successful in 
reducing review times over the past few years to meet performance goals 
established by the Prescription Drug User Fee Act, PDUFA, and now PDUFA 
II. ERSR will contribute to this by helping to reduce the time 
consuming administrative tasks during a review such as search time for 
reference information, eliminating manual creation of data sets for 
analysis, quicker navigation through an application, and eliminating 
re-typing of text from applications.
                  reuse of single use medical devices
    Question. FDA approves some devices for one-time or single use only 
such as endoscopes and catheters used in non-invasive surgery. These 
are difficult to clean and were never intended for reuse. But according 
to a March 22 article in Forbes magazines, some hospitals may be 
reusing some devices intended by the manufacturer and the FDA for one-
time use. In my view, this practice, if it is occurring, raises 
questions of cleanliness and patient safety. The article cites a 
burgeoning reprocessing industry to serve hospitals.
    What action is FDA taking?
    Answer. FDA is carefully evaluating this practice and plans to 
increase our presence in this area. FDA and AAMI will co-sponsor a 2 
day conference on May 5-6, 1999 in Crystal City, Virginia to look at a 
number of issues that exist regarding this practice including, ethical 
issues such as informed consent; regulatory or legal issues such as 
even handed regulation of manufacturers and reprocessors; scientific 
issues such as whether a device intended for a single use only can be 
safely reprocessed and reused; and economic issues such as whether 
manufacturers are labeling devices as ``single use'' for economic 
reasons only or whether there other reasons that they can not be 
reused. FDA is committed to working with the groups represented at the 
conference to resolve these types of issues and to ensure improved 
public health protection relative to this practice.
    A FDA research team is evaluating the effect of cleaning procedures 
and sterilization procedures on the material and mechanical properties 
of materials likely to be in devices that are designated for single use 
but are known to be candidates for reuse by physicians and user 
facilities. The study initially focused on generic materials and then 
was extended to specific cardiac catheters such as balloon angioplasty 
catheters, electrophysiology catheters, and cardiac ablation catheters. 
These are devices that come in contact with blood. These catheters 
presented special problems in terms of complexity, e.g. many channels, 
narrow lumens, lumens closed at one end, and delicate materials and 
design. Data obtained to date suggest that cleaning and sterilization 
of these devices could be very difficult. The material properties and 
device performance can be affected by re-sterilization. Changes in 
device performance that may result from resterilization are model 
specific and a general statement cannot be made for all of the device 
models in a given category. It has been noted that minor changes in a 
given model have been observed to have potentially substantial effects 
on the ability to reprocess. These data will be considered carefully 
when CDRH makes its decision on how to address the issue of reuse of 
single use devices.
    Question. Do you agree that this is in fact happening?
    Answer. Yes, reprocessing of single use devices is occurring within 
both hospitals and clinics and in third party reprocessing facilities, 
who perform these activities at the request of the hospitals and 
clinics. The main reason that some hospitals state they have made the 
decision to reuse single use or disposable products is to cut hospital-
operating costs. Capitation has reportedly had a significant impact on 
the need for hospitals to reduce costs whenever possible.
    Question. Are you trying to determine if it is occurring?
    Answer. FDA is aware that reprocessing and reuse of single use 
devices is occurring in hospitals and clinics. FDA inspects third party 
reprocessors and has been actively involved in evaluating an monitoring 
this practice for some time.
    Question. What assurances can you give me that devices approved for 
one-time use will not be reused?
    Answer. Some single-use medical devices are being reprocessed and 
reused. FDA's concern is and has been the safety and effectiveness of 
the reprocessed devices. FDA published a Compliance Policy Guide, CPG 
300.500, several years ago that focused on hospital operations. That 
CPG stated that there is a lack of data to support the general reuse of 
single use devices. If an institution chooses to engage in this 
practice, the CPG stated that the hospital should demonstrate the 
device can be adequately cleaned and sterilized; the physical 
characteristics or quality of the device will not be adversely 
affected; and that the device remains safe and effective for its 
intended use. This CPG is still in effect.
                         training of resources
    Question. Some drug, device and biotech industry representatives 
have indicated that FDA personnel have difficulty getting and 
maintaining appropriate expertise to review applications. This is 
understandable , particularly in the drug and biotech areas, where 
advances can be very rapid and complex.
    What steps is FDA taking to ensure that FDA staff are knowledgeable 
so that they can adequately review applications?
    Answer. We will be happy to provide the answer for the record.
    FDA's Center for Drug Evaluation and Research, CDER, has a long 
established scientific education program, dedicated to ensuring that 
CDER reviewers stay abreast of their scientific fields. The science 
education program for CDER reviewers has been revitalized to include 
the following activities available on an on-going basis for all CDER 
reviewers:
  --Committee for Advanced Scientific Education (CASE), focused on 
        identifying and evaluating scientific education programs for 
        CDER reviewers
  --Weekly Scientific Seminars and Scientific Rounds, dedicated time 
        each week for CDER reviewers to learn from invited guests, 
        experts in their fields (in the seminars), as well as each 
        other (Scientific Rounds) on topics specifically relevant to 
        the Drug review process
  --Development of CDER and reviewers/discipline core competencies. a 
        program that has identified the critical tasks, knowledge, and 
        skills required to do the job of a reviewer. We are now in the 
        process of preparing learning paths with the information 
        collected. These learning paths will be used to develop 
        specific training programs for reviewers in areas critical to 
        the drug review process
  --Special seminars and workshops, such as the recent ``Drugs and the 
        Liver: What they do to each other'' two-day workshop, 
        especially relevant to the recent liver toxicity issues related 
        to CDER work; as well as the ``Genetics'' workshop, a program 
        co-sponsored with Pharma and BIO to introduce many new 
        scientific concepts to CDER staff
  --Targeted policy training programs designed to ensure that CDER 
        staff understand and can apply the guidances and regulations 
        for industry before they become final, such as the recent 
        Pediatric Exclusivity training program where almost 500 CDER 
        reviewers were trained in less than a month on a critical area.
    We are also in the process of developing two additional programs 
for CDER: one dedicated to bringing academicians on sabbatical to CDER 
for a two to four week period to develop and deliver specific 
scientific courses, while working directly with CDER reviewers; the 
second dedicated to providing time for CDER reviewers to develop their 
expertise in a specific area and time to develop a course for their 
colleagues in that area.
    In addition, many of our programs are videotaped, so that staff who 
are unable to attend the live program may review the video tape.
    The Center for Biologics Evaluation and Research, CBER, developed a 
reviewer training program in 1993 with the advent of user fees, and 
hiring of large numbers of reviewers. The purpose of the training was 
to provide consistent information across the Center, in a forum where 
staff could hear the same information at the same time. The program was 
designed to provide the basic information required to perform a review 
of a biologics application. Over time, the program has gone through 
many iterations to include changes in processes, new regulations and 
guidances, and new ways of doing business.
    The reviewer training program was developed by a curriculum 
committee comprised of office representatives who were involved in the 
review process. It included 9 major modules on the phases of review, 
including the overview of the regulation of biologics, investigational 
new drug applications INDs, product license applications, PLAs, 
establishment license applications ELAs, clinical aspects and good 
manufacturing practices GMPs. Over time, the GMP sessions were moved 
into the inspection training program as prerequisites to the inspection 
workshops.
    In early 1998, based on requests from Center staff a new curriculum 
committee was established to develop the research/review model that was 
more specific in nature, and which impacted on the actual review. These 
programs included not only the basic regulatory issues but also the 
research issues that supported the regulatory review. Topics such as 
lot-release and surrogate endpoints have been delivered, as have been 
programs on the International Conference on Harmonization, ICH. In 
development are programs dealing with process validation, assay 
validation, and other manufacturing issues.
    To ensure scientific expertise in biological product application 
review, CBER uses what is referred to as the ``research/reviewer 
model.'' In this model, the application review personnel spend a 
portion of their time in research-related activities. CBER researchers 
are fully integrated into the application review process. CBER 
researchers participate in the following regulatory procedures: review 
of initial new drug applications, and product license applications; 
development of policy and guidance documents; meetings with sponsors 
and advisory committees; participation in pre-license and biennial 
inspections; and evaluation of adverse drug reactions and risk 
assessment.
    In addition to formal reviewer training, computer-applications 
training is provided in order to receive and review submissions 
electronically. This includes the Agency standard Microsoft suite 
applications as well as JMP for statistical reviews, and Adobe Acrobat 
to read the electronic submissions.
    CBER coordinates with the other Centers on programs of joint 
interest such as the Center for Devices and Radiological Health's FDAMA 
training for device reviewers and the Center for Drug Evaluation and 
Research's packaging guidance.
    Regarding professional development, many of CBER's physicians 
participate in this program by working in clinics, labs and other 
health-care settings for a specified number of hours each year. The 
purpose of this participation is to both enhance their current skills, 
and to maintain state of the art knowledge of medicine.
                               tamoxifen
    Question. I have been told that tamoxifen may be listed as a 
carcinogen in the National Toxicology Program, in their 9th report, and 
that FDA has made a recommendation that it be listed in another 
pharmaceutical category which would create less alarm and could better 
convey the risks and benefits of tamoxifen. Some breast cancer 
advocates are concerned that listing tamoxifen in the carcinogen report 
could create great confusion.
    Will the drug be listed in the carcinogen report? If so, why?
    Answer. We agree with the concern that you raise. Whether or not 
tamoxifen will be listed in the Ninth NTP Report on Carcinogens is not 
the decision of the FDA. That decision will be made by Secretary of 
DHHS in consultation with the Director of the National Toxicology 
Program, NTP. We have appealed to NTP that if it needs to be listed, 
tamoxifen and other pharmaceutical agents be listed in a category by 
that name separate from other substances listed as carcinogens in the 
Report for the very reason that you state.
    Question. Has FDA made a recommendation? If so, what was your 
recommendation? If not, are you planning to make a recommendation.
    Answer. The FDA made a recommendation to NTP in a conference 
telephone call with myself and Dr. Friedman on April 20, 1999. The 
recommendation was that if tamoxifen is going to be listed in the NTP 
Report on Carcinogens, it should be listed along with other 
pharmaceutical agents in a category separate from non-pharmaceutical 
chemicals. This would emphasize the need to consider the benefits of 
drugs and the fact that substances listed under this heading have all 
undergone extensive review by the FDA prior to approval of their use as 
drugs. The pharmaceutical category should clearly and fully convey the 
potential benefits of the drugs. In the case of tamoxifen, for example, 
its use decreases the overall incidence of cancer in the indicated 
high-risk population.
                           tobacco activities
    Question. Unfortunately, last year, Congress did not pass a tobacco 
bill and affirm FDA's jurisdiction over tobacco products. In my view, 
FDA should regulate tobacco products and discourage the use of tobacco.
    What activities are you currently conducting?
    Answer. In fiscal year 1997, FDA designed a pilot program and 
infrastructure to enforce the rule. The Agency, consistent with its 
practices in other areas, determined that it would commission state and 
local officials to enforce the federal rule--specifically to conduct 
unannounced visits to retailers using adolescents younger than 18, who 
would attempt to purchase cigarettes or smokeless tobacco. Initially, 
the Agency contracted for enforcement in 10 states. In fiscal year 
1997, contracts were awarded to Florida, Illinois, Washington, Texas, 
Massachusetts, Colorado, Pennsylvania, Minnesota, Arkansas, and 
California. These states were required to conduct approximately 200 to 
400 inspections per month. Compliance checks began in the first state 
in August 1997. These contracts resulted in approximately 20,000 
compliance checks during the 10 month pilot program.
    In fiscal year 1998, the Agency expanded its enforcement efforts 
and solicited bids from all 57 states and territories to contract with 
FDA to do compliance checks. By the close of fiscal year 1998, FDA had 
signed contracts with 43 states and territories totaling $16,382,912. 
Under these contracts, the states will conduct approximately 186,500 
compliance checks by September 30, 1999. The average contract is 
approximately $390,000. With the signing of each new contract, FDA's 
headquarters or regional staff trains the designated state and local 
officials. Headquarter staff has also spent countless hours answering 
questions from tobacco retailers and providing technical assistance to 
the states.
    All 10 states who participated in the pilot program, renegotiated 
contracts to continue doing compliance checks in their states. In at 
least two states, the programs had been so successful that the states 
chose to expand the initial limited coverage provided by the first 
contract. In Arkansas, for example, the pilot contract provided for 
compliance checks to be conducted only in and around Little Rock. 
Similarly, in Colorado, only a few counties were included in the 
original contract. In both cases, the subsequent contracts 
substantially increased the areas of the state that would be included 
in the investigations.
    The existing contracts resulted in 39,439 attempted and completed 
compliance checks during fiscal year 1998, including reinspection of 
retailers found to have violated the rule. The Agency's legal staff 
devised and established the framework for the imposition of civil money 
penalties, sent out complaints, and negotiated or litigated contested 
cases. In fiscal year 1998, FDA began seeking civil money penalties 
from those found to have violated the rule's restrictions on sales to 
minors for a second time. In fiscal year 1999, FDA began investigations 
of retailers who have been found to have already violated the rule two 
times. The agency anticipates seeking civil money penalties for third 
violations within the first quarter of fiscal year 1999. A penalty 
schedule for violations of other portions of the regulation will be 
developed when these provisions go into effect.
    In the second half of fiscal year 1998, the Agency contracted with 
Battelle Memorial Institute to study the tobacco program's business 
processes, outline the program's work flow and conduct a requirements 
analysis. From this requirements analysis, Battelle proposed a system 
design to automate the program's processes. In addition, Battelle 
presented a proposed plan to obtain and maintain a list of retailers 
selling tobacco in each state that would be more complete, accurate and 
user friendly than the lists constructed by the Agency during its first 
full year of operation.
    Based on the design, Battelle has launched a multi-year effort to 
provide reliable retailer lists and an infrastructure designed to 
maintain the list and make it user friendly for FDA and for all 
contracting states. Battelle will also design and implement an 
information technology system which will automate all the program's 
various functions, including contracting, outreach, enforcement, 
compliance checks, litigation, collection of civil money penalties, 
etc. The new system will increase the efficiency of the program and 
will improve communications internally as well as with state 
contractors and with other stakeholders. The various system design 
components will be implemented incrementally as they are developed 
beginning in early 1999. The entire system should be operational by 
2001. The amount dedicated to this multi-year project in fiscal year 
1998 is $2.8 million.
    In fiscal year 1998, the Agency designed a comprehensive outreach 
program designed to inform retailers and ensure compliance. This multi-
faceted program consisted of advertising, direct mail, press events/
materials, exhibits and speeches, and dissemination of materials 
requested via a hotline or mail order.
    In fiscal year 1998, the Agency designed a multi-media advertising 
campaign, including radio, print, and billboard advertising. A free 
retailer kit using humorous illustrations and a folksy approach also 
was created to make it easier for retailers to comply with the new 
regulation. A series of focus group discussions were held with 
retailers, sales clerks, young people between 18 and 27, children ages 
12 to 18, and the general public to test the advertising campaign and 
retailer kits. During fiscal year 1998, approximately 500,000 retailers 
kits were produced and sent to stores across the country.
    FDA conducted a tracking study in 10 media markets to evaluate the 
effectiveness of the campaign. Findings indicate that awareness of the 
photo identification age provision rose dramatically from approximately 
one-third of retailers to more than one-half of all retailers. In 
addition, there was a three-fold increase in recall of the fine for 
repeat violations in the test markets. Further, in test markets, twice 
as many clerks used 27 as the cut-off age after the campaign compared 
to before the campaign. Importantly, retailers reported that minors 
were somewhat less likely to try to buy tobacco and retailers said that 
customers were less likely to be irritated when asked to show photo 
identification as a result of the advertising campaign. By the close of 
fiscal year 1998, the Agency had obligated approximately $12.5 million 
for outreach activities. This covers the costs of the paid advertising 
campaign as well as the printing and dissemination of nearly a half 
million retailer kits.
    In 1997, $2 million (out of $4.9 million) went to state contracts 
to enforce the rule. In 1998, $16.4 million went to state contracts. In 
1999, the Agency has allocated $22 million towards state contracts.
                           tobacco activities
    Question. What is the status of court challenges to FDA's 
rulemaking on tobacco?
    Answer. On April 25, 1997, the District Court in Greensboro, North 
Carolina, ruled that FDA has jurisdiction under the Federal, Food, Drug 
and Cosmetic Act (FD&C Act) to regulate nicotine-containing cigarettes 
and smokeless tobacco as drug delivery devices. The Court upheld all 
restrictions involving youth access and labeling and struck down, as 
unsupported by the statutory provision relied on by the Agency, the 
rules advertising restrictions. The Court stayed implementation of all 
provisions, except those involving age and ID, pending appeal. Appeal 
was taken and oral argument was held in August 1997 and reargued on 
June 9, 1998 in the Fourth Circuit Court of Appeals. On August 13, 
1998, the Fourth Circuit issued its decision, finding the FDA's 
assertion of jurisdiction and issuance of regulations invalid.
    On April 26, 1999, the Supreme Court granted FDA's Petition for a 
Writ of Certiorari that requested the Supreme Court to review the 
August 14, 1998 decision of the United States Court of Appeals for the 
Fourth Circuit. The granting of the petition continues a stay of the 
issuance of the Fourth Circuit's mandate while the Supreme Court 
considers this case. The FDA regulations prohibiting the sale of 
tobacco products to minors and requiring photographic identification 
for certain sales therefore remain in effect pending the Supreme 
Court's final decision.
    Question. What role do you think FDA should play in assuring 
product safety and discouraging tobacco use?
    Answer. FDA's final tobacco rule is expressly designed to 
discourage and reduce tobacco use by young people. This is the 
cornerstone of our regulation. The agency is also prepared to pursue 
research initiatives that address product safety issues, such as tar 
and nicotine delivery, and tobacco and pharmaceutical products that 
raise questions related to reducing exposure to and harm from tobacco 
products.
                           on-line druggists
    Question. The February 15, 1999 Boston Globe ran a story saying 
that ``the first major Internet pharmacy, Soma.com, went on line with a 
prescription service'' and has ``filled thousands of orders through a 
distribution center in Ohio.'' Others such as AARP and Merck-Medco also 
have online ordering.
    Do you view this as a good development. Do you have any concerns 
about patient records privacy?
    Answer. If online pharmacies and their pharmacists are 
appropriately licensed and comply with all applicable federal and state 
requirements, they can provide benefits to consumers. For example, they 
can provide increased competition in the retail market for prescription 
drugs, OTC drugs, and other health-related products. Such competition 
may result in increased services and convenience, and reduced costs to 
consumers.
    However, online pharmacies that do not meet federal and state 
requirements that have been established to protect and promote the 
public health may impose considerable risks to consumers. These risks 
include questions about the authenticity, potency, and purity of the 
product sold to them.
    In addition, if consumers are obtaining prescription drugs online 
without a prescription or are relying on the prescribing services of 
the online provider, they may be incurring significant risks. They may 
not be communicating complete and accurate medical information about 
their condition or the drug may not be appropriate because of other 
medical conditions or other drugs they are taking.
    Although patient medical and prescription record privacy is an 
important consumer issue, FDA has no information about whether or how 
online pharmacies protect medical records. Those matters are generally 
regulated by the states.
    Question. Does FDA has a role in regulating these ``pharmacies''? 
Should you?
    Answer. FDA does not generally regulate pharmacies. FDA regulates 
products and certain activities related to those products, particularly 
when carried out by or on behalf of a manufacturer, packer, or 
distributor. Under the Federal Food, Drug, and Cosmetic Act, FDA can 
take action against illegal promotion, such as labeling and 
advertising, of a prescription drug; illegal labeling of an over-the-
counter drug; the importation, sale, or distribution of an adulterated 
or misbranded drug; the importation, sale, or distribution of an 
unapproved new drug; and the sale or dispensing of a prescription drug 
without a valid prescription. The States, however, have traditionally 
regulated the dispensing of drugs. Internet sites that carry out any of 
the above illegal acts are subject to regulatory action by FDA or the 
appropriate state agency.
                              drug testing
    Question. Many groups charge that clinical trials for drugs have 
traditionally largely used the ``white, middle class male model,'' and 
have not sufficiently used women, children, the elderly or minorities. 
In the case of women, I know women of childbearing age would be 
especially cautious and should be. However, participation is voluntary 
and on an informed consent basis. And yes, children do represent a 
special case.
    Don't you agree that testing drugs only on men is not sufficient?
    Answer. CDER's position is that testing of drugs only in men is not 
sufficient. The 1993 gender guideline entitled ``Guideline for the 
Study and Evaluation of Gender Differences in the Clinical Evaluation 
of Drugs'', clearly states that we expect drugs to be tested in the 
full range of people who are expected to use them. In addition, in the 
case of serious and life threatening diseases, the agency published a 
proposed rule in 1997 entitled ``Investigational New Drug Applications; 
Proposed Amendment to Clinical Hold Regulations for Products Intended 
for Life-Threatening Diseases'' that would permit us to put on clinical 
hold, that is, stop from proceeding, a trial that excluded either women 
or men based solely on their reproductive capacity.
    Question. What steps have you taken and are you taking to require 
manufacturers to expand the pool of participants in clinical trials?
    Answer. Two important steps have been noted above, the 1993 
guideline and the proposed rule for which we are reviewing comments. In 
addition, we emphasize to our review divisions the importance of 
communicating and emphasizing our expectations at the critical meetings 
with industry that occur during drug development, such as end of phase 
2 meetings. We also have a regulation that permits us to refuse to 
file, that is, not accept for review, any application that lacks 
appropriate subpopulation analyses. Finally, it is worth noting that we 
are nearing completion of a system that will permit us to track 
compliance with these regulations.
    Question. The January 28 USA Today magazine reported, ``According 
to FDA, voluntary compliance with 1993 guidelines encouraging the 
participation of women in trials has been insufficient.'' Why is that?
    Answer. We believe, and our examination of internal data supports, 
that the Gender Guideline is an effective and appropriate means of 
promoting enrollment of women into clinical trials. In our response to 
FDAMA, we explained that after careful examination of all our guidance 
relating to enrollment of women and minorities in clinical trials our 
conclusions was that additional guidance is not needed. However, in 
those instances where the disease is life threatening and early access 
to any therapy may be critical, we wish to have the regulatory 
authority to place on clinical hold a trial that excludes either men or 
women solely on the basis of their reproductive potential.
                                 ______
                                 
                 Questions Submitted by Senator Durbin
                          orphan drug funding
    Question. What assurances do we have that the money appropriated 
for Orphan Drug Development will not be used for other purposes by the 
FDA ?
    Answer. FDA's history has been to fund orphan grants. This is shown 
in recent budgets and committee documents in prior years, by a steady 
level of funding for the grants program despite the Agency having to 
absorb payroll cost increases. This steady level of funding for the 
orphan drug program has been at the expense of other programs. This 
past year, FDA had to absorb additional cuts and asked the orphan drug 
program to take a proportional share of these reductions to meet the 
increase needed for payroll. It is not expected that this will be 
necessary again next fiscal year.
    Question. Rare diseases have very little opportunities for 
development of drugs to treat them. Therefore, the funds appropriated 
for the Orphan Drug Development are very important for patients with 
rare diseases who have nowhere else to turn for cures. As I stated at 
the hearing, Senator Cochran and I engaged in a colloquy urging FDA not 
to cut Orphan Drug Development funds. What has FDA done to address this 
colloquy ?
    Answer. FDA agrees that the Orphan Drug Development program is 
important and is striving to maintain the orphan drug program and the 
current level of appropriated dollars and FTE.
                               medguides
    Question. Easy to understand information on correct drug usage and 
inappropriate drug usage is very important to consumers. What is the 
time-line for FDA's implementation of the Medguide rule for those 
products that pose a significant public health risk if misused ?
    Answer. The rule that will require that products posing a serious 
and significant public health concern necessitating distribution of 
FDA-approved patient labeling called ``Medication Guides'' was 
published on December 1, 1998, and will become effective June 1, 1999. 
After June 1, FDA will notify manufacturers with affected products that 
they must draft and submit for FDA review, patient labeling as 
specified in the rule. We expect that the vast majority of these 
products will be identified at the time of initial submission for 
approval, and we anticipate using the rule to require FDA-approved 
Medication Guides for only a small number of products currently being 
marketed. Once a product's Medication Guide is approved, it will be 
required to be distributed to patients along with the product.
    FDA's Center for Drug Evaluation and Research is currently drafting 
an internal process guide for reviewers to help ensure that products 
that pose a ``serious and significant public health concern'' are 
expeditiously identified and a draft Medication Guide is submitted. In 
the meantime, an interim process has already been put in place in 
recognition of the June 1, 1999, effective date of the rule.
                  re-use of single use medical devices
    Question. The unauthorized re-use of medical devices that were 
designed for a single use may pose a significant threat to public 
health. Given that there is little documentation of the re-use of 
products, how does the FDA propose to track infections or injuries that 
may result from the inappropriate re-use of single use devices ?
    Answer. FDA has an established regulation, Medical Device Reporting 
under 21 CFR Part 803, for the reporting of adverse event reports for 
all medical devices. FDA will continue to use this system for tracking 
infections, injuries and other adverse events reported by manufacturers 
and users involving the reuse of single use devices. Reports have been 
received where reuse was indicated but the information obtained to date 
has been insufficient to demonstrate that the reprocessing of a single 
use device has caused a reported adverse event.
    FDA recognizes the need to continually educate manufacturers and 
users about the Agency's adverse event reporting requirements and types 
of events that need to be reported. FDA will also enlist the 
cooperation of other organizations to obtain reuse experience data. FDA 
is currently working with the Health Care Financing Administration to 
include questions about device reuse during HCFA inspections of user 
facilities.
    Question. Should patient consent be sought when a medical facility 
seeks to use a secondhand device on that patient?
    Answer. While most patients would probably choose a new device over 
a reprocessed one if given the choice, physicians frequently make 
choices for their patients without consulting them. These choices are 
made in an effort to administer the most effective medical care for the 
patient and includes decisions such as the type of device to use, the 
particular application or use and duration of use of that device, the 
type and amount of drug or antibiotic to administer, etc. Physicians 
routinely review the patient's medical history, including allergies, to 
make these decisions and oftentimes do not obtain specific informed 
consent. Use of a reprocessed single use product may be safe and 
appropriate depending on the specific device, how and where it will be 
used, and other considerations, including cost. Although FDA does 
monitor informed consent on clinical research with FDA-regulated 
products, FDA does not regulate the practice of medicine.
    Question. Does FDA have information on the efficacy of 
sterilization or reprocessing of these devices?
    Answer. FDA has access to data and information for the 
resterilization and reprocessing of single use devices that are 
performed by third party reprocessing firms. These firms reprocess 
under contract with hospitals and clinics and they are inspected by the 
FDA under the Quality System regulation, 21 CFR Part 820. The 
inspections are broad-based and cover the firm's quality assurance 
activities from the receipt and handling of incoming materials to the 
final packaging, labeling and release of the device. The inspections 
are designed to determine whether the reprocessing activities are 
validated--that is to demonstrate that the processes employed do not 
adversely affect device materials or functionality. When significant 
deficiencies are identified, follow-up regulatory action is considered. 
FDA has little data on the efficacy of resterilization and reprocessing 
in hospitals because the Agency does not inspect those operations. 
However, to the extent that those operations caused an adverse event in 
a hospital, user facilities are required to report those event to FDA.
    A FDA research team is presently evaluating the effect of cleaning 
procedures and sterilization procedures on the material and mechanical 
properties of materials likely to be in devices that are designated for 
single use but are known to be candidates for reuse by physicians and 
user facilities. The study initially focused on generic materials and 
was later extended to specific cardiac catheters such as balloon 
angioplasty catheters, electrophysiology catheters, and cardiac 
ablation catheters. These are devices that come in contact with blood. 
These catheters presented special problems in terms of complexity, e.g. 
many channels, narrow lumens, lumens closed at one end, and delicate 
materials and design. Data obtained to date indicate or suggest that 
cleaning and sterilization of these devices can be very difficult. The 
material properties and device performance can be affected by re-
sterilization. Changes in device performance that may result from 
resterilization are model specific and a general statement cannot be 
made for all of the device models in a given category. It has been 
noted that minor changes in a given model have been observed to have 
potentially substantial effects on the ability to reprocess. These data 
will be considered carefully when CDRH makes its decision on how to 
address the issue of reuse of single use devices.
    Question.  What does FDA view as their role in regulating 
reprocessors?
    Answer. FDA is currently reviewing whether additional regulation or 
other oversight of reprocessing is needed. FDA will continue to work 
with groups represented at the FDA/AAMI Conference on Reuse of Single 
Use Devices to resolve outstanding issues and concerns and consider new 
regulatory approaches. One factor that needs to be carefully thought 
through are the costs and benefits of reprocessing on device users and 
patients.
    Reprocessors are divided into two categories, in-hospital 
reprocessing and third party reprocessing. FDA has jurisdiction over 
both types of reprocessors. For in-hospital reprocessing, FDA currently 
provides no routine direct oversight; however, if a serious adverse 
event occurred in a hospital involving a device, FDA would typically 
conduct an investigation. Additionally, FDA does receive and monitor 
adverse event reports and may initiate follow-up activities at a 
hospital, distributor, manufacturer, or other facility, as needed. The 
user facilities doing the reprocessing are liable for adverse outcomes.
    Third party reprocessing is currently regulated by FDA in the 
following way. Firms that reprocess single use devices are required to 
register their establishment with FDA, list the devices they reprocess, 
comply with the FDA Quality System regulation for the design, 
manufacture, testing, packaging, and release of those devices, report 
adverse events under the Medical Device Reporting regulation, and label 
their products appropriately as outlined in 21 CFR Part 801, Labeling.
                                 ______
                                 
                  Questions Submitted by Senator Byrd
                   generic drug applications backlog
    Question. The Food and Drug Administration (FDA) is the responsible 
federal agency for implementing policies designed to protect the health 
of the nation against impure and unsafe foods, drugs, and cosmetics, as 
well as other potential hazards. Today, I have several questions 
regarding the Office of Generic Drugs, and the pre-market Food Contact 
Notification program.
    The generic drug industry, including Mylan Laboratories, Inc., 
headquartered in West Virginia, has alerted me that consumers and all 
purchasers of pharmaceutical products, including the federal 
government, could realize substantial savings if the FDA adhered to its 
statutory deadline for the Office of Generic Drugs (OGD) to review 
generic drug applications, known as Abbreviated New Drug Applications 
(ANDA), within 180 days.
    Please provide me with a report on the backlog of pending generic 
drug applications in the OGD, and what actions are being taken to meet 
the statutory deadlines and reduce backlog?
    Answer. The backlog of original applications under the old counting 
system, was 714 on March 31, 1999. Of the 714 applications, 154 had 
been pending with the agency longer than 180 days. We have now reduced 
the total time to approval. Many, but not all, of those initiatives do 
help the agency meet the statutory deadlines and reduce backlog.
    Question. Please estimate the cost of the backlog to consumers and 
the federal government.
    Answer. The Agency does not have the information to measure or 
estimate the cost of the backlog of pending generic drug applications 
to the consumer. FDA estimates that it would need approximately 105 
additional FTE to review the generic drug applications within 180 days, 
thus alleviating the majority of the backlog.
    With regard to the pre-market Food Contact Notification (FCN) 
program, the FCN provisions of the FDA Modernization Act of 1997 are 
intended to expedite introduction of advanced food packaging materials 
while assuring the protection of public health. FCN has a significant 
impact on the Kanawha Valley Union Carbide plant in West Virginia that 
develops food contact materials, and I have the following questions:
    Question. The FDA reform legislation that Congress enacted in 1997 
included a streamlined regulatory process for approving food contact 
materials. What is the status of the implementation of the new FCN 
program?
    Answer. FDA was allocated $500,000 to develop guidance, 
regulations, and procedures necessary to implement the notification 
program for food contact substances should that program be funded in 
fiscal year 2000.
    On March 12, 1999 FDA held a public meeting at which the agency 
shared its tentative plans for guidance and regulations and for the 
administration of the notification procedure. The agency requested 
comments at this meeting on the agency's tentative plans and on the 
draft documents that the agency will use as the basis for completing 
guidance materials for the notification program. FDA is currently 
reviewing the comments.
    FDA expects to publish Federal Register documents in mid-summer 
1999. The first will announce the availability of guidance for 
preparing notifications and guidance on the administration of the 
process. The second, to be published simultaneously, will propose 
regulations for the implementation of the process. The Agency is 
currently hiring critical personnel for the implementation of the 
notification process.
    FDA has and is acquiring a capability to incorporate cutting edge 
science and technology into the review process that will facilitate the 
review of notifications for food contact substances, while concurrently 
developing an electronic workflow tracking system to track the progress 
of the review for notifications for food contact substances.
    Question. The FDA Modernization Act authorized $3 million for the 
FCN program. In today's dollars, is this amount adequate to implement 
the FCN program as envisioned?
    Answer. Secretary of DHHS submitted a cost estimate for the fiscal 
year 2000 Premarket Notification, PMN, program for food contact 
substances on April 22, 1999 to the Senate Appropriations and Health, 
Education, Labor and Pensions Committees. FDA calculated a cost of 
$6.04 million to fully operate the premarket notification program.

                         CONCLUSION OF HEARINGS

    Senator Cochran. This is the final hearing in our 
committee's review of the fiscal year 2000 budget request for 
activities and programs that are funded under the jurisdiction 
of this committee.
    We appreciate all Senators and staff who have helped in 
this effort to review the budget and to understand the request 
from the administration and to make sure that we provide the 
funds that are needed to carry out the statutory obligations of 
these agencies and this department.
    We thank you all for your cooperation. The committee stands 
in recess.
    [Whereupon, at 11:20 a.m., Tuesday, April 27, the hearings 
were concluded and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]


AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

    MATERIAL SUBMITTED BY AGENCIES NOT APPEARING FOR FORMAL HEARINGS

    [Clerk's note.--The following agencies of the Department of 
Agriculture did not appear before the subcommittee this year. 
Chairman Cochran requested these agencies to submit testimony 
in support of their fiscal year 2000 budget request. Those 
statements follow:]
                       DEPARTMENT OF AGRICULTURE
  Alternative Agricultural Research and Commercialization Corporation 
                                (AARCC)
     Prepared Statement of Robert E. Armstrong, Executive Director
    Mr. Chairman and members of the Subcommittee. I am pleased to 
testify today on the President's fiscal year 2000 budget request of $10 
million for the Alternative Agricultural Research and Commercialization 
Corporation (AARCC). It is a pleasure to provide you with an update on 
the Corporation's investment successes and the effect the AARC 
Corporation is having on the economy of rural America.
    I would like to offer the subcommittee a short background on how we 
got to where we are today. Congress created the AARC Center in the 
Food, Agriculture, Conservation, and Trade Act of 1990, and 
reauthorized it in the Federal Agriculture Improvement and Reform Act 
of 1996 as a wholly-owned corporation of the Federal Government within 
the U.S. Department of Agriculture (USDA). AARCC's creation followed a 
1987 report of the New Farm and Forest Products Task Force. The Task 
Force met for 2\1/2\ years and recommended developing and 
commercializing a wide array of new farm and forest products using the 
excess production capacity of American agriculture as a way to 
revitalize ailing segments of rural America. The Chairman of AARCC's 
Board of Directors, Jeff Gain, served on that Task Force.
    The idea of using agricultural materials as the raw materials for 
manufacturing and commercializing the things of everyday life is not 
new. In fact, the motto of USDA reads: Agriculture is the Foundation of 
Manufacture and Commerce. That was written in 1862. In more recent 
times, the Chemurgic Council advocated for agriculture to be the 
supplier of our raw materials. The Council was established in 1935 
under the leadership of Wheeler McMillen, with financial support from 
Henry Ford. Other notables on the Council included Thomas Edison, Irene 
du Pont, MIT President Karl Compton, Nobel Laureate and physicist 
Robert Milliken, General Motors Vice President Charles Kettering, and 
Sears, Roebuck & Company Board Chairman Robert E. Wood. The USDA's four 
regional research laboratories grew out of this effort and were built 
in 1938-1941 for the express purpose of finding new uses for farm 
products.
    Many historical examples exist of efforts to use agricultural 
materials for the manufacture of non-food and non-feed products. George 
Washington Carver devoted his life's work to this effort. Henry Ford 
even built a car body from vegetable plastic and plant fibers. Today we 
are beginning to see a move in Europe to a car that can be totally 
recycled. Across many industrial sectors we are seeing a move toward a 
bio-based economy. In fact, the head of a major oil company was 
recently quoted as saying that the world is entering ``the last days of 
the Age of Oil.''
    The advantages of a bio-based economy are numerous, but three in 
particular are worth noting. First, such an economy uses agricultural 
materials that are domestically produced and annually renewable. I am 
certain the geopolitical and economic advantages of such a source of 
raw materials is not lost on the members of this Subcommittee. Second, 
unlike petroleum--our current main source of raw materials--it is not 
economical to ship bio-based raw materials long distances for 
processing and manufacturing. The processing and manufacturing must 
take place close to the source of the materials, and that means jobs in 
rural America. Finally, using bio-based materials means that at the end 
of a product's lifetime, it can be composted and used to grow the next 
year's supply of raw materials. Thus, an economy based on biology, 
instead of geology, takes full advantage of America's agricultural 
production capacity, provides jobs for rural America, and contributes 
to the well-being of the environment.
    As you know, the AARC Corporation's mandate is to assist or invest 
in companies that are commercializing non-food/non-feed products , 
processes, or technologies that use raw materials derived from 
agriculture, forestry, or animal by-products. Through its investment 
activities, AARCC is a leading force in the effort to put America at 
the forefront of a global bio-based economy. Like any investment firm, 
AARCC measures its success through the success of the firms in which it 
has invested. AARCC also measures its success through the impact it has 
in rural America. Let's examine some of the factors AARCC uses to gauge 
its progress.
    The return on investment (ROI) is a standard measure for any 
investment firm. In AARCC's case, it is of particular interest, because 
we have been entrusted with the public's money. Typically, a venture 
capital firm focusing on the type of start-up and early-stage companies 
that AARCC does, would not anticipate repayments beginning until 6 or 7 
years after an investment was made. In AARCC's case, our business plan 
projects a minimum of $100,000 and a maximum of $300,000 in repayment 
by this point in time. By the end of fiscal year 1998, AARCC had 
received $450,911.65 in repayments. AARCC is ahead of its ROI 
projections.
    Another important measure is the amount of private capital that 
AARCC is able to attract into its client firms. The legislation 
requires fifty cents of private money to be matched against every 
dollar of AARCC investments. The actual ratio we see is approximately 
$3.50 of private money for every dollar of AARCC investments. Thus, 
since AARCC began its investment activities, we have attracted 
approximately $130 million from the private sector into rural America.
    The expanded use of agricultural land is an additional factor that 
AARCC considers when making investments. Each year, about 10 percent of 
America's agricultural production capacity is fallow. AARCC is helping 
to put that land back into use. Since 1993, we estimate approximately 
250,000 acres have been put back into production to grow the raw 
materials used by AARCC companies to manfacture their various products.
    The most important measure of all is job creation in rural America. 
It is also the most difficult number to determine as it involves both 
direct jobs in the companies, as well as indirect jobs in the broader 
economy. Using various approaches to calculate the number, we estimate 
that AARCC has contributed--both directly and indirectly--to the 
creation of approximately 7,500 jobs in rural America.
    Finally, I want to discuss AARCC's efforts with other Federal 
agencies to help the government realize the promise of Executive Order 
13101, Greening Government Through Waste Prevention, Recycling, and 
Federal Acquisition. Working through USDA's Bio-based Products 
Coordinating Council and the Office of the Federal Environmental 
Executive, AARCC helped develop language for the Executive Order that 
encourages Federal purchasing agents to use set-asides and references 
to procure both recycled and bio-based products. Many of the bio-based 
products available to government purchasing agents today are made by 
AARCC-supported companies.
    In conclusion, on behalf of the members of the Board of Directors 
of the AARC Corporation, I respectfully ask the Subcommittee to support 
the President's budget request of $10 million. With adequate 
appropriations, AARCC can continue its move towards privatization--as 
directed in the Federal Agriculture Improvement and Reform Act of 
1996--and be an engine for development in rural America.
    Mr. Chairman, I would be pleased to answer any questions you or 
your colleagues may have about the AARC Corporation.
                                 ______
                                 
      Cooperative State Research, Education, and Extension Service
    Prepared Statement of Dr. Colien Hefferan, Acting Administrator
    Mr. Chairman and Members of the Committee, I appreciate the 
opportunity to present the proposed fiscal year 2000 budget for the 
Cooperative State Research, Education, and Extension Service (CSREES), 
one of four agencies in the Research, Education, and Economics (REE) 
mission area of the United States Department of Agriculture (USDA).
    CSREES works in partnership with the land-grant university system, 
other colleges and universities, and other public and private research 
and education organizations, in concert with the Secretary of 
Agriculture and the intent of Congress, to initiate and develop 
agricultural research, extension, and higher education programs. These 
programs are carried out by land-grant universities and other partners.
    This strong partnership has supported great successes that have far 
reaching impacts on our Nation, the food we eat, the environment in 
which we live, and the quality of life of our citizens. For example, 
land-grant researchers are rapidly developing vaccines for some of the 
nation's most dreaded livestock diseases. A Mississippi State 
researcher has developed a single-injection, inexpensive vaccine that 
is estimated to reduce poultry deaths resulting from coccidiosis by up 
to 80 percent. Composting and recycling have benefitted farmers and 
homeowners as well as municipalities, landfills, and other operations. 
Through the coordination efforts of extension specialists, 1.2 million 
tons of yard waste is kept out of California landfills annually. At the 
Virginia Polytechnic Institute and State University, the Crop and Soil 
Environmental Science Department experienced a tenfold student 
enrollment increase and a 100 percent job placement rate in the last 10 
years, demonstrating the need for agriculture college graduates. New 
Mexico State University scientists have discovered a method for 
controlling the Colorado potato beetle, the potato's most destructive 
pest, by inserting a gene in the potato that acts as a natural beetle 
repellent but does not harm humans or animals. These are just four 
examples from a long list of accomplishments of our university 
partners. They illustrate the success of a strong Federal/State 
partnership focused on agricultural knowledge that addresses broader 
issues in production, rural communities, the agricultural system, the 
environment, and people.
    The fiscal year 2000 budget proposes an increase of 2.6 percent in 
discretionary funds. As reflected in the proposed increases, CSREES is 
committed to three overarching themes in its fiscal year 2000 budget:
    Targeting High Priority Programs.--CSREES' goal is to target high 
priority research, education, and extension programs to meet the shared 
goals of the Federal/State partnership. These priorities include 
programs in food safety and programs that expand outreach to minority-
serving institutions and help producers meet requirements under the 
Food Quality Protection Act.
    Expanding the use of competitively-awarded Grants.--Agriculture 
needs to attract the best scientists, extension agents, educators, and 
other professionals to address key agricultural problems. We believe 
that this is best accomplished through competitive programs that are 
adequately funded. The CSREES commitment to improving the science base 
for agriculture through competitive grants is reflected in the $81 
million increase for the National Research Initiative (NRI). The 
increase will enable the NRI to attract more of the best scientists, 
including those just beginning their careers, from a large scientific 
community which remains eager to seek solutions for agriculture but 
which has been discouraged by funding uncertainties. The $81 million 
increase will provide the resources needed to enhance and develop 
scientific areas that are critical to agriculture today, such as 
agricultural genomics, food safety, environment and natural resource 
management, and competitiveness and profitability of agriculture. 
Experience has shown that a significant portion of competitively-
awarded grants go to land-grant institutions. Providing additional 
funding through the NRI, as well as mandatory programs, such as Section 
401 of the 1998 research act and the Fund for Rural America, and the 
new Integrated Activities programs, will result in a substantial 
increase to land-grant institutions.
    Integration of Research, Extension, and Education.--The CSREES 
commitment to integrating research, extension, and education, is 
reflected in the integrated grant authority established in the CSREES 
budget in accordance with Section 406 in the Agricultural Research, 
Extension, and Education Reform Act (AREERA) passed by Congress in June 
1998. An increase and redirection of $72.8 million is provided in the 
budget for integrated research, education, and extension activities 
related to small farms, water quality, food safety, improved pest 
control, and food recovery and gleaning. This integrated grant 
authority allows the agency to support programs that solve problems 
through multifunctional research, extension, and education activities 
without the distinction resulting from separate legislative authorities 
for research and extension. This approach is expected to promote a 
stronger linkage between research, extension, and education to ensure 
that the knowledge and technology generated by research is delivered to 
the end-users, including producers, consumers, communities, and 
students. The Integrated Research, Education, and Extension Grants 
Program is a competitively-awarded program under which eligibility 
includes all colleges and universities to ensure diversity in problem-
solving approaches.
    In developing a budget around these themes, the recurring challenge 
to CSREES has been to ensure that its programs are responsive to 
national needs, as expressed by stakeholders and as reflected in 
Department and Administration priorities.
                   fiscal year 2000 budget highlights
    Achieving sustained long-term improvement in the competitive 
position of United States agriculture relies critically on the Federal 
government's assurance that producers and marketers have access to the 
basic tools for success. Studies have shown that successful producers 
(farmers, ranchers, and foresters) are better educated, more apt to 
adopt new technology, have lower costs of production, and take better 
advantage of or have more opportunities for spreading production and 
marketing risk across alternative enterprises and mechanisms, than 
their less successful counterparts. The fiscal year 2000 CSREES Budget 
proposes $4 million for a Small Farms Initiative that will develop 
research, education, and extension programs in appropriate marketing 
strategies for small farms, business skills for small farmers, and help 
beginning farmers establish viable farm operations and enterprises.
    Food safety is dependent upon a production system that is well-
integrated into an environment that is as pathogen-free as possible, a 
food processing and handling system free of pathogen contamination, and 
an educated public to ensure that both producers and consumers know 
their role in providing for the safe production, handling, and 
consumption of food. Food security is dependent upon an efficient and 
productive agricultural system based on healthy crops and livestock. 
The fiscal year 2000 budget proposes $15 million for an integrated 
research, extension, and education food safety program in support of 
the President's Food Safety Initiative. This integrated program will 
focus on research to improve the safety of food products and education 
and extension programs to create a public that is more informed about 
food safety issues.
    Increases are proposed also to support the development and 
application of new technology and management practices to replace the 
traditional pest controls that are at risk of being restricted or 
prohibited due to the Food Quality Protection Act of 1996 (FQPA). The 
budget proposes $10 million to support long-term development and 
implementation of innovative pest management funds for major acreage 
crops, fruits, and vegetables through an integrated research, 
education, and extension competitive grants program. A $3 million 
increase is proposed for the development of alternative pest controls 
for fruit and vegetable crops to replace pesticides at risk of not 
meeting the new FQPA requirements.
    An additional $5 million is proposed for development of practical 
management alternatives and technologies for commodities affected by 
the methyl bromide phase-out now scheduled for 2005 under recent 
amendments to the Clear Air Act. These programs, in conjunction with 
increased funding for the Pest Management Alternatives, Minor Crop Pest 
Management, the Expert IPM Decision Support System, the Pesticide 
Applicator Training Program, and sustained funding for the Integrated 
Pest Management research and extension programs, will ensure a more 
safe and secure food and fiber system.
    Establishing the scientific basis for optimal health, developing 
knowledge of the eating habits of Americans, and modifying food intake 
behavior are critical components to having a well-nourished population. 
An increasingly important component to having a well-nourished 
population is empowering our communities to build their capacities to 
meet a greater share of their food needs. The fiscal year 2000 Budget 
proposes a $15 million Food Recovery and Gleaning Program to improve 
methods of collection, transport and storage of recovered and gleaned 
food, to enhance the technical assistance and education network, to 
empower local communities to establish and administer food recovery 
programs, and to develop and extend knowledge about technical issues in 
food recovery such as food safety and volunteer development. An 
increase of $2.3 million above the 1999 level also is proposed for the 
Expanded Food and Nutrition Education Program (EFNEP) to support 
nutrition education programs aimed at meeting the need of 
undernourished segments of the population, especially children.
    As a Nation, we increasingly value the environment--clean air and 
water, unique ecosystems, and pristine land. We recognize that, given 
the vast amounts of land being used in agricultural or forest 
production, we must ensure that our production practices, as well as 
our public policies and programs affecting these practices, are 
consistent with the dual objectives of promoting competitiveness while 
preserving natural resources and environmental quality. To achieve 
these goals, a better understanding of the complex interactions between 
agricultural production and the environment is needed. Water Quality is 
a serious national concern as reflected in the President's Clean Water 
Action Plan. We propose an integrated research and extension water 
quality program that will support projects to address such issues as 
the linkage between agricultural practices and outbreaks of harmful 
algal blooms, which can lead to conditions that cause massive fish-
kills, human health problems, and significant economic losses to the 
seafood industry. An increase of $0.5 million is proposed in the 
Sustainable Agriculture Research and Education Program to expand the 
availability of scientifically sound and practical methods for farmers 
and ranchers to achieve profitability, environmental stewardship, and 
quality of life for families and communities.
    Americans recognize that their quality of life depends largely on 
economic, physical, and institutional factors affecting their families, 
businesses, and communities. The fast pace of changes in these factors, 
and their increasingly complex interactions, present a growing 
challenge. CSREES in partnership with the land-grant university system, 
enhances the capabilities of individuals, families, and communities to 
improve their quality of life. The fiscal year 2000 budget proposes an 
increase of $1 million for the Children, Youth, and Families at Risk 
program to enhance child care programs for those segments of the 
population in greatest need, including limited resource families, 
isolated farm and rural families, and families needing child care 
during non-traditional hours, such as families of migrant farm 
laborers.
    CSREES strategies to ensure responsive and effective management of 
USDA's extramural research, extension, and education programs include: 
strengthening the Federal/State partnership; integrating research, 
extension, and education activities as appropriate; improving 
information management systems which are accessed by both internal and 
external users; and participating in efforts to improve financial 
management within USDA. The fiscal year 2000 budget proposes an 
increase of $1 million for the Research, Education, and Economics 
Information System (REEIS). Increased funding will support the broad 
implementation of the system to enable CSREES and the REE mission area 
to meet the reporting requirements of the Government Performance and 
Results Act and facilitate implementation of the provisions of the 
Agricultural Research, Extension, and Education Reform Act of 1998.
    In response to USDA Civil Rights Action Team recommendations to 
address disparities in funding and enhance the Department's cooperative 
efforts with institutions of higher education that are primarily 
devoted to the needs of minority students, a number of increases are 
included in the CSREES budget. An increase of $0.3 million is provided 
for the Hispanic Serving Institutions Education Grants program; an 
increase of $3.6 million is provided for the 1890 Institutions 
Facilities program; an increase of $1.4 million is provided for the 
Extension Services at 1994 Institutions program; an increase of $667 
thousand is provided to establish a new 1994 Institutions competitive 
research program; and an increase of $3.3 million is provided for the 
Extension Indian Reservations Program. Additionally, eligibility under 
the new Integrated Authority programs is open to all colleges and 
universities, including the 1890 and 1994 land-grant institutions.
    In addition to the increase for the Hispanic Serving Institutions 
Education Grants program, funding is provided for other higher 
education programs to continue ongoing efforts to support graduate and 
undergraduate education aimed at improving instructional capabilities 
in food and agricultural sciences.
    The fiscal year 2000 Budget also includes mandatory funding of $120 
million for the Initiative for Future Agriculture and Food Systems 
under Section 401 of AREERA for competitive research, education, and 
extension grants to address critical and emerging agriculture issues. 
Mandatory funding also is available under the Fund for Rural America, 
where approximately $30 million is to be provided for a wide range of 
research, extension, and education activities. The budget also supports 
funding for the Community Food Projects grants program at $2.5 million 
(supported with mandatory funds provided by the Food and Nutrition 
Service Food Stamp Program).
    An increasing portion of Federal funds will be distributed 
competitively to address the most critical needs of the agricultural 
community and fund the most highly meritorious projects. The increases 
proposed for competitive programs are partially offset by decreases in 
formula funds and non-competitive projects slated for reductions due to 
constrained budget resources. The additional flexibility provided in 
the Agricultural Research, Extension, and Education Reform Act where a 
portion of the formula funds can be used to support either research or 
extension projects, allows states more authority to use Federal funds 
in addressing their highest priority needs.
    The advent of the 21st century finds us poised to meet the many 
challenges facing the food and fiber system. The President's fiscal 
year 2000 Budget Request for CSREES reflects the commitment of the 
Administration to further strengthen the problem-solving capacity of 
Federally-supported agricultural research, extension, and higher 
education programs.
                                 ______
                                 
                      Departmental Administration
   Prepared Statement of Sally Thompson, Acting Assistant Secretary, 
                             Administration
    Mr. Chairman and members of the Subcommittee, it is a pleasure to 
present the President's budget proposal for fiscal year 2000 for USDA 
Departmental Administration. I am currently filling a dual role as the 
Acting Assistant Secretary for Administration and as the Chief 
Financial Officer. As Acting Assistant Secretary for Administration, I 
will be discussing the central administrative functions of the 
Department including: human resource management, government ethics, 
procurement policy and property management, facilities construction and 
operations, small and disadvantaged business utilization, program and 
administrative outreach, administrative law and Hazardous Waste 
Management. Ms. Rosalind Gray, Director of the Office of Civil Rights, 
will submit a separate statement on the civil rights progress and 
activities at the Department of Agriculture. I will also provide the 
Subcommittee with a separate statement covering the Office of the Chief 
Financial Officer.
    We appreciate the support provided by this Subcommittee in recent 
years that has allowed us to continue critical administrative 
operations and the additional funding to continue essential support to 
the Department's civil rights effort.
    Departmental Administration conducts varied and diverse oversight 
and support to provide quality leadership and service to the USDA 
agencies that deliver programs and services to the public. To give some 
idea of the wide range of these responsibilities, here are just a few 
examples of our on-going activities.
                           government ethics
    During fiscal year 1998, the Department established the Office of 
Ethics to oversee a vigorous government ethics program in USDA. With 
close coordination with the Office of the General Counsel and the U.S. 
Office of Government Ethics, this staff office is reviewing the ethics 
programs throughout the Department to assure that an effective ethics 
program is maintained within each of the Department's mission areas. An 
ethics Web site which provides training information and financial 
disclosure forms has already been established.
                            welfare to work
    The Office of Human Resource Management has coordinated the 
Department's implementation of the President's Welfare to Work 
Initiative. As of December 1, 1998, USDA had hired 374 employees from 
the welfare rolls. As a result, we have already achieved the 
Department's goal for the year 2000.
                     workplace conflict management
    During fiscal year 1998, we established a Conflict Prevention and 
Resolution Center in USDA headquarters. Through this office, we are 
working with the agencies to identify potential areas of employee 
conflict and to train employees and management personnel to recognize 
and deal with potentially dangerous situations. We are actively engaged 
in the President's Interagency Working Group on Alternative Dispute 
Resolution, and in December 1998 we issued the USDA Handbook on 
Workplace Violence which was distributed to all employees.
          bringing rural america venture opportunities--bravo
    The Office of Small and Disadvantaged Business Utilization has 
initiated the Bringing Rural America Venture Opportunities program to 
increase the participation of American Indian owned businesses with 
USDA. The BRAVO initiative establishes partnerships among rural 
communities, Indian nations, 1890 institutions, The Hispanic 
Association of Colleges and Universities, Native American educational 
institutions, small disadvantaged companies, private companies, and 
government organizations. Large technology companies currently doing 
business with USDA provide mentoring and support. Initial projects are 
focusing on establishing businesses to provide software development, 
maintenance and technical support for USDA. Employees are being 
recruited/trained from Indian Reservations and economically 
disadvantaged surrounding areas. Participating USDA agencies will 
direct a small percentage of already budgeted and approved software 
development contracts to support this initiative. The President has 
endorsed this program as a way of addressing equal employment 
opportunity for American Indians.
                   continuity of operations planning
    Last year the President assigned the Cabinet officers the 
responsibility for developing a comprehensive plan to assure that the 
capability exists to continue essential government functions in the 
event of localized or general disaster. We are developing the 
Continuity of Operations Plan which includes: emergency delegations of 
authority (where permissible and in accordance with law); safekeeping 
of vital resources, facilities and records; emergency acquisition of 
resources necessary to reestablish essential functions; and alternative 
work sites.
               departmental administration budget request
    The fiscal year 2000 Budget request for Departmental Administration 
is $36,117,000 which is $3,949,000 more than the fiscal year 1999 
appropriation. The primary elements of this increase are: $931,000 to 
strengthen and expand the leadership and coordination capabilities for 
the Office of Outreach and expand outreach activities to minority and 
limited resource customers; $1,639,000 for the Office of Civil Rights 
to continue efforts to correct past weaknesses and strengthen USDA 
civil rights activities; and $1,050,000 for mandatory pay cost 
including the Office of Civil Rights. Absorbing these pay increases 
would require cuts in the program areas put in place with the fiscal 
year 1999 appropriation.
              outreach for socially disadvantaged farmers
    For fiscal year 2000, we are requesting $10,000,000 for grants and 
contracts to community based organizations and certain educational 
institutions to provide outreach and technical assistance to socially 
disadvantaged farmers. This is an increase of $7,000,000 over the 
amount provided in fiscal year 1999. The current program supports 27 
community based organizations and land-grant colleges that provide 
technical assistance and training to approximately 8,700 participants, 
primarily low-income farmers and ranchers, with a service area of 394 
counties in 21 states. Our outreach efforts included town-hall 
meetings, workshops, and farmer field day activities that reached more 
than 107,000 people. Where the program is available, it has been 
successful in reducing the rate of land loss among small, limited-
resource farmers. The budget increase will allow eight additional 
entities and double the number of counties to provide technical 
assistance and training that will help reverse the decline in the 
number of minority farmers and ranchers. This increase would also 
fulfill the Civil Rights Action Team Report recommendation to fully 
fund this program.
        agriculture buildings and facilities and rental payments
    The fiscal year 2000 Budget requests $166,364,000 for Agriculture 
Buildings and Facilities and Rental Payments. This is an increase of 
$29,180,00 including $21,000,000 for South Building modernization, 
$7,485,000 for increased rental payments to GSA, and a net increase of 
$695,000 for building operations and maintenance.
                       usda strategic space plan
    In our efforts to help reduce costs associated with housing our 
Washington area employees, USDA is implementing a long term plan to 
consolidate USDA Headquarters into two government-owned locations which 
will provide modern and safe facilities as well as enhance program 
operations. The Plan includes the new USDA Office Facility at the 
Beltsville Agricultural Center in Prince George's County, Maryland, and 
the modernization of the South Building in downtown Washington, D.C. 
Construction of the Beltsville Facility is complete and occupancy began 
in January 1998. We anticipate full occupancy by the end of fiscal year 
1999. The new complex is an award winning facility for energy savings. 
In addition, we are pleased to note that USDA will be receiving the 
1998 Government Award from the National Industries for the Severely 
Handicapped, due in great part to our contract with Melwood, a 
community rehabilitation program, to operate this facility. The 
contract provides employment for over 60 people and is the first of its 
kind. It will provide new opportunities for the disabled in non-
traditional careers such as building engineering.
    The South Building is over 60 years old, eligible for listing on 
the National Register of Historic Places, and in dire need of repair 
and renovation to make it safe, efficient, and functional. The required 
renovation work includes fire protection systems; abatement of 
hazardous materials such as asbestos, PCB light fixtures, and lead 
paint; replacement of old, inefficient heating, ventilation and air 
conditioning systems for improved energy conservation and air quality; 
upgrade of electrical and plumbing systems; improved accommodations for 
disabled persons; and accommodation of modern office telecommunications 
systems. Construction of Phase 1--interior reconstruction of Wing 3--
began in September 1998. The fiscal year 2000 funds are requested for 
the construction of Phase 2--interior reconstruction of Wing 4. The 
design for Phase 2 has been substantially completed so that a 
construction contract can be awarded as soon as funds become available.
                       hazardous waste management
    The Department requests $22,700,000 for the Hazardous Waste 
Management Program, an increase of $7,000,000 over the fiscal year 1999 
level, to meet the minimum needs of the Comprehensive Environmental 
Response, Compensation and Liability Act; the Resource Conservation and 
Recovery Act; and related state and local laws. We must meet the 
challenge of cleaning up contaminated lands under USDA's jurisdiction. 
Our prior year activities generally concentrated on identifying 
contaminated sites, assessing the problems, and developing cleanup 
strategies. We are moving out of the investigation phase of these sites 
and conducting more complex and costly response actions. We have more 
than 2,000 contaminated sites remaining to clean up and restore. These 
remaining sites tend to be the most costly. For example, the cost of 
cleanup of problems caused by other responsible parties on facilities 
and lands that we manage, including abandoned mines and landfills, is 
estimated to exceed $2 billion. If we do not ensure that these sites 
are cleaned up in a timely manner, the potential for fines, penalties 
and law suits could rapidly exceed the cleanup.
                               conclusion
    Mr. Chairman and members of the Subcommittee, this concludes my 
statement on the Departmental Administration budget for fiscal year 
2000. I want to reiterate our appreciation for the strong support which 
this Subcommittee has given us.
                                 ______
                                 
                       Economic Research Service
          Prepared Statement of Susan E. Offutt, Administrator
    Mr. Chairman and members of the Committee, I am pleased to have the 
opportunity to present the proposed fiscal year 2000 budget for the 
Economic Research Service.
                                mission
    The Economic Research Service provides economic and other social 
science research and analysis on efficiency, efficacy, and equity 
issues related to agriculture, food, the environment, and rural 
development to improve public and private decision making.
                                 budget
    ERS's appropriation for 1999 of $65.8 million consists of the 1997 
appropriation level ($53.1 million), an increase of $12.2 million to 
evaluate food stamp, child nutrition, and WIC programs, and an increase 
of $.5 million to estimate the benefits of food safety. This 
appropriation was adjusted to $64.9 million with the move of Office of 
Energy to the Office of the Chief Economist. ERS continues 
implementation of its streamlining strategy and plans to maintain staff 
in 1999 at its current level of 525 full-time equivalents. ERS 
continues to make full use of early-out and buy-out authorities. In the 
future, ERS must manage its staff levels to maintain its non-salary 
program of agricultural data purchases and cooperative university 
research necessary to support its analytical program.
    The agency's request for 2000 is $55.6 million, a net decrease of 
$9.3 million from the adjusted 1999 appropriation. The net decrease 
consists of seven parts: a $.9 million increase for enhancing commodity 
market analysis; a $.7 million increase for a study on carbon 
sequestration; a $.3 million increase for the U.S. Global Climate 
Change National Assessment; a $.5 million increase for estimating the 
benefits of food safety; a $.3 million increase to meet the analytical 
information needs of small farmers, niche marketers, other casualties 
of an industrializing agricultural sector; a $.2 million increase to 
assess the potential impacts of electric utility deregulation; and a 
$12.2 million decrease for evaluations of food stamp, child nutrition, 
and WIC programs. Funding for these evaluation studies in 2000 is 
included in the Food and Nutrition Service (FNS) budget.
                ers contributions to mission area goals
    ERS shares five general goals with its fellow agencies in the 
Research, Education, and Economics mission area: a highly competitive 
agricultural production system, a safe and secure food supply, a 
healthy and well nourished population, harmony between agriculture and 
the environment, and enhanced economic opportunity and quality of life 
for all Americans. These goals are fully consistent with the U.S. 
Department of Agriculture mission.
Goal I: The agricultural production system is highly competitive in the 
        global economy.
    ERS helps the U.S. food and agriculture sector effectively adapt to 
changing market structure and post-GATT and post-NAFTA trade conditions 
by providing analyses on the linkage between domestic and global food 
and commodity markets and the implications of alternative domestic 
policies and programs on competitiveness. ERS economists analyze 
factors that drive change in the structure and performance of domestic 
and global food and agriculture markets; provide economic assessments 
of competitiveness and efficiency in the food industry; analyze how 
global environmental change, international environmental treaties and 
agreements, and agriculture-related trade restrictions affect U.S. 
agricultural production, exports, and imports; and provide economic 
analyses that determine how fundamental commodity market relationships 
are adjusting to changing trade, domestic policy, and structural 
conditions. ERS will continue to consider how the potential for 
increased commodity price and farm income variability affects market 
performance and interacts with Federal policies and programs. These 
analyses will include short- and long-term projections of U.S. and 
world agricultural production, consumption, and trade. ERS has 
increased the frequency of reporting on commodities' outlooks, even as 
it endeavors to strengthen the analysis that leads to an understanding 
of reported observations. In addition, ERS will continue preparation 
for the new World Trade Organization round (that will include 
agriculture) by analyzing the economic effects of Uruguay Round policy 
disciplines; assessing the economic effects of state trading and 
tariff-rate quota allocations; and assessing regional trade 
initiatives. In this latter category, ERS experts will take a more in-
depth look at China's evolving role in world agricultural markets. ERS 
will conduct research on the changing structure (for example, vertical 
integration, concentration, and contracting) of the food marketing 
chain and will also analyze the effectiveness and use of alternative 
marketing strategies and risk management tools in mitigating farm 
income risk, including tools available from both private and public 
sector providers.
    ERS analyses can help guide and evaluate resource allocation and 
management of public sector agricultural research, a key to maintaining 
increases in productivity that underlie a strong competitive position 
for U.S. farmers. ERS economists track and endeavor to understand the 
determinants of public and private spending on agricultural R&D 
evaluate the returns from those expenditures; and consider the most 
effective roles for public and private sector research entities.
            Enhancing Commodity Market Analysis
    The request for an increase of $854,000 in fiscal year 2000 is to 
assure continued Agency strength in and sufficient capacity for 
commodity outlook analysis. Principal means for obtaining this 
assurance will be through the development of strategic alliances with 
Land Grant universities and other public institutions performing 
commodity market analysis, and improvement of the breadth, ease, and 
timeliness of access to USDA commodity market data and information. 
These plans preclude the development of information gaps or limited 
access to private market data and analysis as barriers to efficient 
production and marketing decisions by American farmers, marketers, or 
traders.
            Information Needs of Small Farmers
    Because small, limited resource, and socially disadvantaged farmers 
are particularly dependent on publicly disseminated market data and 
information, it is critical for the efficient functioning of the entire 
American sector (not just the largest operations) that any differences 
in the nature of information most useful to strategic decision making 
by small and larger, more advantaged farmers be well understood by the 
public providers of commodity market analysis. The request for a one-
time increase of $350,000 will assure that ERS has this knowledge by 
funding a study to discover the unique information needs of unique and 
disadvantaged groups in the American agricultural sector. Increasing 
the capacity to meet these unique information needs is supportive of 
the small farm initiative.
Goal 2: The food production system is safe and secure.
    ERS focuses on improving the efficiency and effectiveness of public 
policies and programs designed to protect consumers from unsafe food by 
analyzing benefits of safer food and the costs of food safety policies; 
efficient and cost-effective approaches to promote food safety; and how 
agricultural production and processing practices affect food safety, 
resource quality, and farm workers' safety. This research helps 
government officials design more efficient and cost-effective 
approaches to promote food safety. Specifically, the ERS research 
program provides detailed and up-to-date appraisals of the benefits of 
safer food, such as reducing medical costs and costs of productivity 
losses from foodborne illnesses caused by microbial pathogens. In 
addition, ERS has undertaken new research on the costs to industry and 
consumers of alternative food safety policies, including assessment of 
the distribution of costs across the food industry and across 
demographic groups.
    Understanding how food prices are determined is increasingly 
important in responding to domestic and international market events and 
opportunities that promote the security of the U.S. food supply. As the 
farm share of the food dollar declines, accurate retail price forecasts 
depend more heavily on understanding the marketing system beyond the 
farmgate. ERS systematically examines the factors that help set retail 
prices, including an assessment of the roles of the transportation, 
processing, manufacturing, wholesaling and retailing sectors, the 
impact of imports and exports, and linkages to the total economy.
            Food Safety Risk Assessment Initiative
    A project to assess the risks and benefits of pathogen control 
options is proposed for fiscal year 2000 at $453,000 as part of the 
President's Food Safety Initiative. A fundamental barrier to evaluating 
food safety programs and policies is imperfect knowledge about the 
sources of risk along the food chain and how these might be addressed 
by pathogen control options. Efforts to estimate the benefits and costs 
of options to reduce foodborne illnesses are hampered by lack of 
knowledge about how pathogen control efforts will eventually affect 
public health. Further research on risk assessment by economists, in 
collaboration with other scientists, will provide decision makers with 
better estimates of the benefits and costs of efforts to promote food 
safety. Ensuring that our efforts to improve food safety are carefully 
targeted and prioritized on the basis of cost-effectiveness is central 
to our goal of providing the Nation with the safest possible food 
supply. This initiative is a part of the President's food safety 
initiative and the produce and imported food safety initiative.
Goal 3: The nation's population is healthy and well-nourished.
    ERS helps identify efficient and effective public policies that 
promote consumers' access to a wide variety of high-quality foods at 
affordable prices. ERS economists analyze factors affecting dietary 
changes; assess impacts of nutrition education and the implications for 
the individual, society and agriculture; and provide economic 
evaluations of food nutrition and assistance programs. The Agency 
studies the implications for producers and consumers of movement 
towards adoption of the dietary guidelines; the trends and determinants 
of American's eating habits; evolution of food product trade; and the 
determinants of food prices. Analysis of nutrition education efforts 
considers what kinds of information motivate changes in consumer 
behavior, the food cost of healthy diets, the influence of food 
assistance programs on nutrition, and the implications of healthy diets 
for the structure of the food system. Because trade in high valued 
agricultural products, including processed food, now exceeds the value 
of bulk commodity flows, ERS will spend more time to disaggregate the 
components of these trade flows, understand their relationships to 
international investment and strategic behavior of U.S. food firms; and 
investigate the implications for U.S. consumers of a globalized food 
marketplace.
Goal 4: Agriculture and the Environment are in Harmony.
    In this area, ERS analysis helps support development of Federal 
farm, natural resource, and rural policies and programs that promote 
long-term sustainability goals, improved agricultural competitiveness, 
and economic growth. This effort requires analyses on the profitability 
and environmental effects of alternative production management systems 
and on the cost effectiveness and equity of public sector conservation 
policies and programs. ERS analysts focus on evaluating the benefits 
and costs of agricultural and environmental policies and programs in 
order to assess the relationship between improvements in environmental 
quality and increases in agricultural competitiveness. In this vein, 
ERS provides economic analyses on the linkages between biodiversity and 
sustainability issues and agricultural performance, competitiveness, 
and structure.
            Carbon Sequestration Initiative
    We request an increase of $700,000 in fiscal year 2000 to assess 
the economic potential for using agricultural lands to sequester 
atmospheric carbon. This will increase the use of production practices 
that build organic soil carbon that enhance the quality and 
productivity of affected lands. This will also be in accordance with 
U.S. commitments to mitigate greenhouse gas emissions under the Kyoto 
Protocol, as well as assessing the potential to target existing USDA 
conservation programs to include carbon sequestration. Possible 
``carbon sinks'' include shifting marginal agricultural lands into 
forests, shifting croplands into permanent grasses, and adopting 
production practices that result in higher levels of soil carbon. 
Expanding the quantity of U.S. farm land in forests and grasses could 
complement existing USDA conservation goals of reducing soil erosion, 
improving water quality, and enhancing wildlife habitat.
            U.S. Global Change Program National Assessment
    ERS will continue to participate in and support the U.S. Global 
Change Program National Assessment. An increase of $300,000 is 
requested to develop a detailed understanding of the consequences of 
climate change for various economic sectors, geographic regions, and 
the nation as a whole. The Administration strongly believes that 
increased funding for climate change initiatives as described above 
will make U.S. agriculture better prepared to reduce and respond to the 
impacts of those changes in the future.
Goal 5: Enhanced economic opportunity and quality of life for rural 
        Americans.
    The ERS contribution to improving opportunity and quality of life 
in the U.S. is based on analysis that identifies how investment, 
employment opportunities and job training, and demographics affect 
rural America's capacity to prosper in the global marketplace. ERS 
economists analyze rural financial markets and how the availability of 
credit, particularly Federal credit, spending, taxes, and regulations 
influence rural economic development. ERS analyzes the changing size 
and characteristics of the rural and farm populations and the 
implications of these changes in human capital, including skill 
development, on the performance of rural economies. In addition, ERS 
studies the economic structure and performance of non-farm economic 
activities in rural areas, including the fairly widespread rebound in 
population growth in non-metropolitan counties. The relevant analyses 
will involve monitoring rural earnings and labor market trends with 
emphasis on regional and other disaggregations in order to provide 
insight into the determinants of variation in trends among non-metro 
counties. Such work should yield a better understanding of the factors 
that promote rural vitality and the opportunities for effective public 
sector intervention.
    Because the effects of changes in welfare programs may vary between 
rural and urban residents due to differences in labor markets and other 
aspects of a regional economy's structure, ERS social scientists will 
track implementation of recent program changes to understand any 
differential impacts. In particular, ERS analysis can help anticipate 
changes in participation across assistance programs, including those 
for which USDA has primary responsibility, in rural housing and in 
food. Another opportunity for understanding whether rural America faces 
unique circumstances will come with analysis of a recently-completed 
survey of the rural manufacturing sector.
    ERS continues to monitor the financial situation of the farm 
sector, establishing farm business organization and performance 
benchmarks. This task includes study of the financial position of 
farmers who employ technological advances and innovative risk 
management strategies in their businesses, compared with the financial 
position of farmers who use more traditional approaches. Previous work 
on the use of production and marketing contracts by farmers will be 
extended to identify contractors by class to better define the role of 
non-farm businesses in the industrialization of farms. Analyses of 
financial performance will also measure the comparability of returns 
between farm and non-farm small businesses and assess the financial 
viability of commercial and non-commercial size farm operations.
            Electric Utility Deregulation
    In fiscal year 2000, ERS proposes a study to assess the potential 
impacts of electric utility deregulation on rural America. Electric 
utility deregulation began with the passage in 1992 of the Federal 
Energy Policy Act and has continued as State legislatures and 
regulatory agencies consider further deregulating the delivery of 
electricity to industrial and residential consumers. While these steps 
could result in substantial savings nationwide, the savings will not be 
uniformly distributed. The resulting changes will have important 
impacts on the competitiveness and well-being of agriculture, other 
businesses, and communities in rural America, as well as on rural 
electric cooperatives and USDA's electric utility loan programs. 
Recently the agency initiated work to better understand the issues 
involved in electric deregulation and to assess the impact of projected 
swings in electric utility rates on regional economies. The request for 
$200,000 will allow ERS and its cooperators to expand upon this early 
work and assess the potential impacts of deregulation on the 
Department's rural utility loan programs, on the competitiveness of 
rural businesses and communities, and on rural households.
                 customers, partners, and stakeholders
    The ultimate beneficiaries of ERS's program are the American people 
whose well-being is improved by informed public and private 
decisionmaking leading to more effective resource allocation. ERS 
shapes its program and products principally to serve key decision 
makers who routinely make or influence public policy and program 
decisions. This clientele includes White House and USDA policy 
officials and program administrators/managers, the U.S. Congress, other 
Federal agencies and State and local government officials, and domestic 
and international environmental, consumer, and other public groups, 
including farm and industry groups interested in public policy issues.
    ERS carries out its economic analysis and research in four 
divisions. ERS depends heavily on working relationships with other 
organizations and individuals to accomplish its mission. Key partners 
include: the National Agricultural Statistics Service (NASS) for 
primary data collection; universities for research collaboration; the 
media as disseminators of ERS analyses; and other government agencies 
and departments for data information and services.
                            closing remarks
    I appreciate the support that this Committee has given ERS in the 
past and look forward to continue working with you and your staff to 
ensure that ERS makes the most effective and appropriate use of the 
public resources. Thank you.
                                 ______
                                 
                       National Appeals Division
            Prepared Statement of Norman G. Cooper, Director
    Mr. Chairman and members of the Subcommittee, I am pleased to 
appear before you to discuss the fiscal year 2000 budget request for 
the National Appeals Division.
                              introduction
    The National Appeals Division (NAD) was established by the 
Secretary of Agriculture pursuant to the Reorganization Act of 1994. 
The Act consolidated the appellate functions and staffs of several USDA 
agencies to provide for hearings on appeal of adverse agency decisions, 
and review of appeal determinations by the NAD Director. NAD appeals 
currently involve program decisions of the Farm Service Agency, Risk 
Management Agency, Natural Resources Conservation Service, Rural 
Business-Cooperative Service, Rural Housing Service, and Rural 
Utilities Service. NAD is headquartered in Alexandria, Virginia, and 
has regional offices located in Indianapolis, Indiana; Memphis, 
Tennessee; and Lakewood, Colorado. NAD's staff of 133 includes 75 
hearing officers Nationwide.
                                mission
    Our mission is to conduct evidentiary administrative appeals 
hearings and reviews arising out of program decisions of specific USDA 
agencies. Our strategic goal is to conduct timely hearings and issue 
timely and well-reasoned determinations that correctly interpret 
applicable regulations. In addition, in States covered by the United 
States Court of Appeals 8th Circuit, NAD Hearing Officer's adjudicate 
applications for fees under the Equal Access to Justice Act (EAJA). 
NAD's mission is statutorily specific, but the administration is 
dynamic and challenging, given the complexities of changing laws, 
regulations and policies.
                    fiscal year 2000 budget request
    NAD is requesting $12,699,000 in direct appropriations for fiscal 
year 2000. This request represents an increase of $981,000 over the 
fiscal year 1999 appropriation. The increase is comprised of $392,000 
for pay costs and $589,000 for training costs.
    NAD employees must possess a broad, in-depth knowledge of many 
areas, including adjudication procedures as well as the laws and 
regulations of subject agencies. The hearing and review officers must 
stay abreast of changes in the law, regulations and agency policies, in 
order to issue determinations that are legally correct. Continuous 
training and development is essential to providing the public a 
competent and fair administrative appeal system that recognizes the 
rights of program participants and promotes the lawful operations of 
agency programs. NAD's budget request for training will be used to 
sustain high-quality training that is critical to accomplishing our 
goal.
    We are also requesting $392,000 to offset the anticipated fiscal 
year 2000 federal pay raise. Our budget has remained fixed at the 
current level since fiscal year 1997. We cannot continue to absorb pay 
cost increases without jeopardizing our ability to provide an effective 
administrative appeals system.
                               conclusion
    NAD's administrative appeals process is a cost-effective service 
for program participants to have adverse agency decisions fairly and 
impartially adjudicated in a timely manner consistent with the intent 
of Congress. The initiatives in the fiscal year 2000 budget will help 
ensure that we accomplish our mission in a more efficient and effective 
manner, making correct determinations and continuing to assure the 
rights of all participants in appeals. The initiatives provide the 
groundwork for accomplishing the goals and objectives outlined in NAD's 
Strategic Plan and annual performance plan. More importantly, these 
initiatives assure farmers, ranchers, cooperatives, agencies, and 
others an avenue to a fair and equitable adjudicative process. I would 
like to provide for the record a copy of the brochure that describes 
these initiatives.
    That concludes my statement, and I am looking forward to working 
with the Committee on the fiscal year 2000 National Appeals Division 
budget.
                                 ______
                                 
                     Office of the Chief Economist
          Prepared Statement of Keith Collins, Chief Economist
    This statement discusses the functions and fiscal year 2000 budget 
request of the Office of the Chief Economist, or OCE.
    OCE is a small staff of analysts located in Washington, D.C., plus 
one weather officer field unit in Mississippi. OCE reports directly to 
the Secretary of Agriculture and has four primary missions: (1) provide 
economic analysis to the Executive Branch and Congressional policy 
officials on alternative policies, programs and regulations; (2) serve 
as a focal point for the collection and reporting of economic and 
weather data, forecasts and projections related to agricultural 
commodities, and the performance of the agricultural economy; (3) 
provide economic and policy analysis on issues related to energy and 
new uses in agriculture; and (4) conduct statutory review and oversight 
responsibilities related to risk assessment and cost-benefit analysis 
of major USDA regulations. OCE also coordinates several activities that 
cut across USDA mission areas, which include global climate change, 
sustainable development and agricultural labor.
    OCE has four functional units: the Immediate Office; the World 
Agricultural Outlook Board; WAOB; the Office of Risk Assessment and 
Cost-Benefit Analysis, ORACBA; and the Office of Energy Policy and New 
Uses, OEPNU. Some recent activities and accomplishments in each of 
these four areas are briefly discussed.
                immediate office of the chief economist
    The immediate office, with a staff of nine, directs a wide range of 
analysis related to policy, program and legislative proposals, and 
regulations. The focus is on the most substantial, complex and 
controversial issues, usually at the request of the Secretary, other 
Administration officials, or members of Congress. The most important 
products are briefings, and briefing and analysis papers prepared on 
tight deadlines. These analyses generally focus on short- to medium-
term effects, involve staff from other agencies, and apply the results 
of existing, basic economic research to specific policy issues. The 
immediate office staff is also responsible for regulatory review. A key 
role of the staff is to coordinate analyses among USDA agencies. 
Examples of key activities during the past year are:
    OCE works with other agencies to assess program options and guide 
effective Departmental decision making with respect to key program 
provisions. OCE provided numerous assessments to the Secretary and the 
administration on the state of the farm economy as conditions eroded in 
many areas during 1998. OCE led the development of the USDA proposal to 
OMB for emergency assistance to producers in 1998. OCE worked closely 
with the Marketing and Regulatory Programs mission area to address 
issues in concentration. OCE helped develop program options and 
analyzed proposed regulatory actions submitted by the public on ways to 
deal with concentrated markets. OCE provided continual advice and 
analysis to the Secretary on dairy policy, including Federal Milk 
Marketing Order reform. OCE coordinated Departmental analysis of 
proposed settlement between tobacco companies and State Attorneys 
General and buyout proposals for tobacco producers. OCE continues to 
assist the Animal and Plant Health Inspection Service--APHIS--in 
verifying compensation claims for producers, handlers and others 
affected by Karnal bunt regulations and assisted in drafting 
regulations, cost-benefit analyses, and decision memoranda dealing with 
Karnal bunt. OCE analyzed models of the Standard Reinsurance Agreement, 
or SRA, to assist the Risk Management Agency in their 1999 SRA 
negotiations with the crop insurance industry. The models were used to 
analyze the budget implications and industry rates of return of various 
reinsurance proposals, including reinsurance for catastrophic and 
revenue products.
    OCE was an active member of the U.S. interagency group on climate 
change and was part of the country delegation attending meetings of the 
United Nations Framework Convention on Climate Change--FCCC--in Buenos 
Aires, Argentina and Bonn, Germany. OCE was instrumental in elevating 
the issue of carbon sequestration in the UN Intergovernmental Panel on 
Climate Change and the FCCC Subsidiary Body for Scientific and 
Technical Advice. OCE took the lead to coordinate an interagency group 
to assess the potential of sequestering carbon through forest 
management and crop land practices.
    In the area of small farm issues, OCE participated in a 
Departmental interagency task force established to review and provide 
advice on implementation of the recommendations from the National 
Commission on Small Farms. OCE participated in the Secretary's 
Transportation Summit and on a special task force created to monitor 
and improve the performance of the western rail system. This task force 
initiated a new report, that provides an early warning of potential 
railcar shortages and bottlenecks in the movement of grain and grain 
products.
    OCE served on the Economic Options Committee of the United Nations 
Technical and Economic Assessment Panel for the Montreal Protocol. The 
Committee prepared a report on economic issues pertaining to 
implementation of the scheduled phase out of ozone depleting 
substances. Included in the report are analyses of various alternatives 
for reducing production and consumption of ozone depleting substances.
    During the past year, the staff reviewed analyses supporting 
Significant and Economically Significant regulations issued by the 
Department. The staff provided critical review and guidance in the 
Department's regulatory analyses for regulation of retained water in 
poultry and meat, storage temperature for eggs and meat imports. In 
addition, the staff assisted the Forest Service in developing the 
supporting analyses for revisions of timber sale contracts regulations 
and the proposed road construction.
    OCE worked with the Department of Labor, National Economic Council, 
and the Immigration and Naturalization Service to streamline and 
improve for farm employers and employees the H-2A temporary 
agricultural worker program. The staff helped to develop a new program 
to assist farm employer's in California meet their labor needs and 
prospective workers to find work under California's welfare reform act. 
OCE staff maintained an Internet web page to provide the public 
information on farm employment rules and regulations, farm safety, and 
worker protection from pesticides.
    OCE coordinates sustainable development activities within USDA. 
This is done chiefly through USDA's Council on Sustainable Development, 
chaired by the Director of Sustainable Development, which develops, 
coordinates, and integrates the principles of sustainable development 
into policies and programs across all mission areas of the Department. 
During the past year, the Director served as the lead USDA member of 
the U.S. delegation to the UN meetings on sustainable development. The 
Director also co-chaired USDA's Council on Sustainable Development, 
which implemented a Sustainable Agriculture Learning Initiative to 
bring together sustainable agriculture farmers with bankers and 
insurance specialists.
    OCE advised Congress through testimony and staff briefings on the 
effects of the developments in markets, prices and income prospects and 
on global climate change.
                 world agricultural outlook board--waob
    The WAOB prepares world agricultural and weather assessments and 
coordinates USDA' work related to agricultural outlook, projections, 
weather, and remote sensing. The Board issues a monthly publication 
known as the World Agricultural Supply and Demand Estimates report and 
oversees long-term USDA forecasts required for preparation of the 
Federal budget. The Board also operates and manages the Joint 
Agricultural Weather Facility, JAWF, in cooperation with the National 
Oceanic and Atmospheric Administration, NOAA, and is home to the 
Department's Chief Meteorologist. In addition, the Board provides 
technical assistance and coordination for USDA's remote sensing 
activities.
    Coordinating USDA Economic Forecasts.--The WAOB plays a critical 
role in assuring that the Department's commodity information system 
responds to today's rapidly changing world. The Board's mission is to 
ensure that USDA's intelligence on domestic and foreign agricultural 
developments is timely, accurate, and objective, and to speed the flow 
of that information to producers, consumers, and policy makers.
    One of WAOB's primary functions is to coordinate and review all 
USDA forecasts and analyses of foreign and domestic commodity supply 
and demand conditions. USDA's Interagency Commodity Estimates 
Committees are chaired by staff of the WAOB. The purpose of these 
committees is to assure that sound information from domestic and 
international sources is fully integrated into the analytical process 
and that USDA's economic forecasts are objective, thorough, and 
consistent. The committees, with representatives from the Economic 
Research Service, Farm Service Agency, Foreign Agricultural Service, 
Agricultural Marketing Service, and WAOB, are responsible for 
developing official estimates of supply, utilization, and prices and 
reviewing economic reports issued by USDA agencies. In fiscal year 
1998, the Board reviewed and approved for release approximately 150 
reports.
    In addition, daily market highlights and weekly briefing reports 
were prepared for the Secretary and top staff, weekly weather and 
economics briefings were presented to the Under Secretary for Farm and 
Foreign Agricultural Services, and international weather highlights 
were published in the Weekly Weather and Crop Bulletin.
    Each month, the WAOB publishes the World Agricultural Supply and 
Demand Estimates [WASDE] Report, which forecasts production, trade, 
utilization, prices, and stocks. Coverage includes U.S. and world 
grains, oilseeds, and cotton and U.S. livestock and poultry products 
and sugar. Release is simultaneous with the U.S. Crop Production 
report. WASDE is internationally viewed as a benchmark for agriculture 
and provides timely knowledge of world commodity markets that is 
increasingly critical to our export-led farm economy. Equally 
important, the WASDE report gives early warning of changing crop 
production and supply prospects in the United States and in other 
countries.
    Oversight of Long-Term USDA Commodity Projections.--WAOB chairs the 
Department's Interagency Agricultural Projections Committee that 
oversees preparation of long-term projections for farm commodities, the 
U.S. agricultural economy, and world agricultural trade. The Economic 
Research Service has the lead role in preparation of the projections. 
WAOB's role is to ensure a strong multi-agency effort and sound 
analytical procedures for the projections. The projections are used for 
a variety of analytic and mandated functions of the Department, such as 
preparing the USDA portion of the President's budget. These 
``baseline'' projections provide an objective, rigorous, and thorough 
view of the likely path of the farm sector over the long term.
    The most recent set of long-term projections, Agricultural Baseline 
Projections to 2008, was publicly released in February 1999 at the 
Department's annual Agricultural Outlook Forum. The projections reflect 
the adverse impact that poor worldwide growth prospects and increasing 
world supplies have on prospects for U.S. agricultural trade in the 
near to medium term. Nonetheless, despite problems in the next few 
years, more favorable long-term world economic growth supports gains in 
exports and farm income as we pass 2000. The overall farm financial 
picture shows assets accumulating faster than liabilities throughout 
the projection period, a sign that the sector as a whole remains 
fundamentally sound.
    The annual USDA Agricultural Outlook Forum, conducted under OCE's 
leadership, is a public meeting on farm, food, and trade prospects. The 
Forum was planned in consultation with a large number of agencies, 
making this a true USDA team effort. The Chief Economist invited, and 
sessions were organized by, the Agricultural Marketing Service; Animal 
and Plant Health Inspection Service; Grain Inspection, Packers and 
Stockyards Administration; Natural Resources Conservation Service; 
Foreign Agricultural Service; Economic Research Service; Farm Service 
Agency; and the Risk Management Agency. The Forum is rich with USDA's 
expertise on risk management, marketing, grain inspection, plant and 
animal health, and soil and water conservation.
    Outlook Forum 1999, the seventy-fifth annual meeting, took place in 
late February 1999. Attendance, topping 1,100, was the highest in 
recent years. The program featured a spectrum of issues affecting the 
future of agriculture, discussed from many vantage points. In addition 
to near-term and long-range agricultural prospects, topics ranged from 
new marketing strategies to the impacts of biotechnology and 
environmental regulation. Speakers were drawn from farming, 
agribusiness, environmental groups, government, and academia. Extensive 
media coverage and posting of speeches on the Internet shortly after 
the Forum ensured the timely dissemination of information presented.
    Monitoring Weather Impacts on Agriculture.--USDA places a high 
priority on incorporating weather-based assessments into all analyses. 
The focal point for this activity is the Joint Agricultural Weather 
Facility, JAWF. JAWF staff continually monitor global weather and 
assess its probable impact on agricultural output. JAWF briefings, 
reports, and special alerts are key inputs to the development of USDA 
crop yield estimates for both competitor and customer countries. JAWF 
weather assessments are made available to the public through the Weekly 
Weather and Crop Bulletin, the WAOB home page, and the news media. 
WAOB's Chairperson and Chief Meteorologist briefed government officials 
and news media frequently on changing crop conditions.
    Disseminating USDA Numbers to the Public.--As commodity prices are 
affected less by Government programs and more by market forces, the 
need for objective and current market information is becoming 
especially critical. The WAOB recognizes the need for rapid information 
dissemination and strives to place the WASDE report Weekly Weather and 
Crop Bulletin in the hands of farmers and other users as quickly as 
possible. The goal is to provide simultaneous access at a minimum cost 
to all market participants.
    WAOB improved electronic access to the monthly WASDE report. The 
WASDE report is now posted instantly on the WAOB home page as well as 
forwarded to the USDA ``Economics and Statistics'' web site at Cornell 
University. In addition, WAOB took the lead in upgrading the usefulness 
of the Cornell University site for USDA information by overseeing a 
redesign and expansion of the help section.
    Interagency Initiatives.--The JAWF worked closely with the National 
Water and Climate Center of USDA's Natural Resources Conservation 
Service and with NOAA Regional Climate Centers on a Unified Climate 
Access Network to provide on-line access to weather and climate data 
from a variety of sources. At the request of the World Meteorological 
Organization, JAWF staff prepared and delivered a training course on 
agricultural data management procedures, attended by 17 participants 
from over 10 countries in Ljubljana, Slovenia. JAWF staff represented 
the United States at the WMO Commission for Agricultural Meteorology in 
Accra, Ghana.
    Also, JAWF put updated sections of its popular handbook Major World 
Crop Areas and Climatic Profiles on the Internet, and is working with 
the U.N. Food and Agriculture Organization to develop an expanded CD-
ROM version using geographic information system--GIS--technology.
    WAOB increased cooperation and dialogue with the Office of the 
Federal Coordinator for Meteorology of the National Oceanographic and 
Atmospheric Administration. This interchange has renewed cooperation in 
support of USDA weather needs. NOAA's National Weather Service recently 
announced that the agency will adopt USDA National Agricultural Weather 
Information System, NAWIS, language and accept it as the 
Administration's position with respect to authorizing this activity.
    Weather Data Receiver Upgraded.--WAOB established a satellite 
downlink for National Weather Service, NEWS data at the USDA's Kansas 
City computer center. This downlink gives access to more reliable and 
comprehensive data, helping to improve crop-weather analysis in support 
of USDA forecasts. It also will make it possible to share timely 
weather data with other agencies such as the Forest Service and with 
field offices in USDA's new agricultural weather observing network.
    Remote Sensing Activities.--At WAOB's request, the Defense 
Intelligence Agency--DIA--opened its archive of more than 10,000 
satellite images to USDA and has agreed to provide scenes requested by 
the Department at no cost. Normally, such images would cost USDA $400 
to $4,400 each. DIA now provides USDA with a list of new imagery 
acquisitions every two weeks. In addition, WAOB successfully negotiated 
an agreement with a private vendor to provide radar imagery to the 
Foreign Agricultural Service, Farm Service Agency, Forest Service, and 
the Natural Resources Conservation Service at no cost. In return, USDA 
will provide DIA with evaluations of the usefulness of radar imagery in 
fulfilling agency missions.
    1890 Institution Partnership.--For the third consecutive year, WAOB 
supported an ongoing partnership with the University of Maryland 
Eastern Shore, an 1890 Institution. The goal of this partnership has 
been to introduce UMES faculty and students to agriculture-related 
occupations.
    Technical Cooperation with China.--WAOB continued an information 
exchange with China that has yielded substantial analytical benefits to 
the Department. The Chairperson traveled to Beijing, Guangxi Province, 
and Sichuan Province with specialists from the National Agricultural 
Statistics Service and the Economic Research Service. Through 
participation in this project, USDA has substantially improved its 
information base with respect to the present and future of China's 
agricultural sector.
    Information Exchange with South Africa.--WAOB continued an 
initiative with South Africa to share meteorological technologies and 
data, under the auspices of the United States/South Africa Bi-National 
Commission. WAOB arranged for a technical exchange between the 
developers of the ``Oklahoma Mesonet'' and scientists representing 
South Africa's Agricultural Research Council, and is now receiving 
real-time weather data collected by South African counterparts.
    Understanding Grain Disease.--Support provided by the JAWF was 
instrumental in helping to dispute non-tariff barriers to wheat trade 
with China and Brazil. USDA used JAWF's extensive weather and climate 
data base to show that neither China or Brazil have climatic conditions 
which would support the growth of TCK smut or Karnal bunt. This 
evidence has weakened the justification by both countries for 
restricting imports of U.S. wheat.
    Drought Initiative.--WAOB continued to play an active role in the 
Western Drought Coordination Council activities. WAOB collaboration 
will continue as the Farm Service Agency assumes leadership of a new 
National Drought Policy Committee.
    Grain Transportation Outlook Initiated.--WAOB assembled an 
interagency committee for the purpose of reviewing and publishing the 
Department's first Grain Transportation Prospects report. This report 
addressed the need to provide the transportation industry with timely 
information on crop supplies in an effort to avoid railcar shortages at 
the expense of agriculture, and to provide farmers with information on 
pressures facing the rail industry.
              office of energy policy and new uses--oepnu
    The Office of Energy Policy and New Uses provides leadership, 
education, coordination, and evaluation for all Departmental energy and 
energy-related activities. The Office develops a unified presentation 
of the Department's energy activities to the Administration, Congress, 
other Federal Agencies, and the public. OEPNU provides analysis and 
information to support policies aimed at increasing farm income and 
rural economic growth. OEPNU initiated and coordinated research in 
electricity deregulation, climate change, biomass, and biodiesel 
issues.
    Electricity Deregulation.--Electricity deregulation that will 
change power rates in rural America presents the Department with an 
important policy issue and potential program concerns for the Rural 
Utilities Service. OEPNU initiated preliminary analysis that enabled 
the Department to include a rural ``place holder'' in the 
Administration's legislation submitted to Congress.
    Ethanol Analysis.--OEPNU developed a coordinated research plan with 
the Department of Energy and Argonne Labs to provide analysis on the 
net climate benefits of corn ethanol to environmental groups. This 
research was cited as part of the Administration's successful effort to 
extend the ethanol excise tax exemption. In addition, OEPNU initiated a 
research program with Department of Energy and the Environmental 
Protection Agency to examine opportunities to expand ethanol's market, 
especially with respect to a proposed low sulfur gasoline program and 
the reformulated gasoline program.
    Biomass Initiative.--OEPNU coordinated and designed a biomass 
research component of the Climate Change Technology Initiative. To 
support the initiative, preliminary biomass economic analysis was 
completed. We have since expanded this work to look at agricultural 
residues with Iowa State University.
    Biodiesel Research.--OEPNU's work on biodiesel has produced a 
redirection of research resources, several publications, and citations 
of the work in congressional hearings. Our work influenced significant 
resource allocation in the joint USDA, the Department of Energy, and 
the American Soybean Association/United Soybean Board's program toward 
more coproduct development and the use of biodiesel as an additive. 
Three publications have been produced by research we used to examine 
the feasibility of biodiesel mandated under the Energy Policy Act of 
1992. Results from this work were cited at Senate and House hearings to 
examine the feasibility of biodiesel as an alternative fuel.
      office of risk assessment and cost-benefit analyses--oracba
    The Office of Risk Assessment and Cost-Benefit Analysis exercises 
the responsibility for reviewing and approving risk analyses for all 
major USDA regulations. The Office serves as a focal point for 
Departmental activities related to risk analysis, including 
interdepartmental activities, risk communication, and education and 
training for improving risk analyses.
    Regulatory and Program Review.--ORACBA reviewed and coordinated 
interagency review of risk assessments in support of several 
significant regulatory proposals, programs, and reports. For food 
safety these include review of the Salmonella enteritidis in eggs risk 
assessment, the irradiation of beef, and rules evaluating ingesta 
contamination during processing in chickens.
    In the international animal trade arena, ORACBA has been involved 
in evaluating regionalization for the EU for classical swine fever; 
regionalization of Mexico for importation of pork and pork products 
from Yucatan and Sonora, of poultry and poultry products from Sonora 
and Sinaloa, and easing the restrictions on importation of ruminants 
and ruminant meat products from certain European countries.
    In conservation and plant health, ORACBA reviewed the risk 
assessments in support of the interim rule on solid wood packing 
material, the final rule on Karnal bunt, the proposed rule for citrus 
from Argentina, and the draft final ``plant pesticide'' rule, so-called 
for plants containing a natural pesticide gene.
    Risk Assessment Education and Training.--ORACBA, in cooperation 
with the Food and Drug Administration and the USDA Graduate School, has 
developed a series of courses on risk analysis. These courses are 
organized into a curriculum for which the USDA Graduate School is 
developing a certificate program. Courses range from a basic 
introduction of risk analysis to an advanced quantitative modeling. A 
course, ``Ecological and Environmental Risk Assessment'' was piloted 
and final designs for permanent status of the course in the curriculum 
are being developed. The courses have serviced individuals from USDA 
and the Food and Drug Administration, but also from several 
universities, the private sector and foreign countries.
    ORACBA sponsors two work groups, Interagency Food Risk Assessment 
Group and the Eco-Risk Group, which include scientists from USDA, other 
government agencies, and the private sector. ORACBA brings in special 
speakers to provide half-day or one-day workshops to focus on special 
methodological issues of concern to the groups.
    Program Guidance and Consultation.--ORACBA continues to provide 
guidance and technical support to agencies responsible for USDA 
conservation programs. This includes a model case-history approach for 
the Environmental Quality Incentives Program, or EQIP, and a series of 
small case-histories for the Conservation Reserve Program, or CRP. An 
interagency team of environmental and ecological risk assessors led by 
ORACBA has worked closely with the agencies in developing these 
studies.
    ORACBA has worked with the Natural Resources Conservation Service--
NRCS--and CRP to develop case-studies to supplement the risk assessment 
that accompanied the original proposed rules. One case-study for NRCS 
has matured into a full-fledged research project involving several 
universities and the Agricultural Research Service. The team is 
tracking the flow of nutrients and five microbes from dairy cattle to 
manure storage and into the environment. These studies will be expanded 
to include swine and poultry operations in the future. The case study 
for CRP has led to proposing to include native honeybees as wildlife; 
heretofore, only vertebrate species have been identified as worthy of 
protection through the CRP.
    ORACBA provides representation to the Risk Assessment Consortium--
RACof the Food Safety Initiative. The RAC has focused its work on 
developing a web-based clearinghouse for food safety risk assessment 
information as well as a risk-based strategic planning project to 
provide insight in the development of the fiscal year 2001 interagency 
food safety budget.
    ORACBA has continued to provide guidance to the Forest Service 
regarding the land donation from the Department of Defense to USDA; 
this work has helped clarify both environmental and legal issues 
surrounding this land. ORACBA actively provides support and guidance 
for the Office of Pest Management Policy with respect to the pesticide 
risk assessments being developed by EPA for the Food Quality Protection 
Program.
    Risk Analysis Coordination and Representation.--ORACBA, working 
through its auxiliary Interagency Food Risk Assessment Group, 
coordinated the development of a farm-to-table model of the E. coli 
O157:H7 risk assessment subsequently being used by the Food Safety and 
Inspection Service to complete the risk assessment. ORACBA serves on 
the Office of Science and Technology Policy and the Council for 
Environment and Natural Resources Center Subcommittee on Toxics and 
Risk. ORACBA organized a written summary of rules dealing with animal 
manure which the Subcommittee issued as a CENR report. ORACBA staff 
facilitated a planning meeting of Animal and Plant Health Inspection 
Service managers to develop a strategy to review the entire program of 
safeguarding American plant resources from alien species.
    Risk Communication.--ORACBA continues to improve communication 
among USDA analysts through the monthly Risk Forum and the quarterly 
ORACBA Newsletter. The Forum brings together scientists from USDA, 
other government agencies, universities, and the private sector; the 
Newsletter has a mailed circulation of over 800 and is available on the 
USDA/OCE/ORACBA website.
    1890 Institutions Partnerships.--ORACBA has worked with several 
1890 institutions, providing guest lectures for their students and 
faculty. ORACBA regularly invites 1890 faculty to attend education and 
training courses provided through the Graduate School. The participants 
do not pay any tuition. ORACBA has also facilitated a partnership 
between Tuskegee University and Harvard University for the BSE Risk 
Analysis. The results have been significant in the responsibility and 
funding for Tuskegee.
                    fiscal year 2000 budget request
    For fiscal year 2000, OCE is requesting $6,622,000 in direct 
appropriations. This request represents a net increase of $211,000 over 
the fiscal year 1999 adjusted base (which includes the transfer of the 
Office of Energy from the Economic Research Service). The proposed 
budget includes an increase of $45,000 for the annualization of the 
fiscal year 1999 pay raise and $166,000 for the anticipated fiscal year 
2000 pay raise.
    OCE is a small office working under a demanding schedule with 
little flexibility to absorb pay and other cost increases. Salary and 
benefits plus required obligations make up 90 percent of OCE's budget 
with necessary, travel, equipment and contracts making up the 
remainder. Pay costs are needed to prevent a decline in weather and 
market analyses, which have been increased and improved as a result of 
increased appropriations the past two years. Without pay costs, the 
previous deficiencies in collection and reporting of global weather and 
economic information would reappear.
                                 ______
                                 
                 Office of the Chief Financial Officer
     Prepared Statement of Sally Thompson, Chief Financial Officer
    Mr. Chairman and members of the Committee, when I appeared before 
you last year, I had been on the job as the Department's Chief 
Financial Officer for only three days. At that time, I told you that my 
top three priorities were: (1) getting an integrated financial 
management system up and running for all USDA agencies; (2) 
streamlining reporting functions, improving performance measurements, 
and increasing accountability; and (3) fulfilling other 
responsibilities authorized by the CFO Act. I also pledged that all of 
the systems at the National Finance Center--NFC--in New Orleans would 
be Year 2000 compliant.
    If I may start with the last item, I am pleased to report that the 
NFC met two self-imposed deadlines, one on June 30, 1998, to make all 
its systems Year 2000 compliant and another on December 31, 1998, to 
ensure that all systems were certified as Y2K compliant. The NFC 
provides payroll/personnel services to 435,000 employees from USDA and 
100 other Federal agencies, accounting for one-fifth of the entire 
Federal workforce. NFC's systems support the Federal Government's 
Thrift Savings Plan--TSP, which is the $74 billion 401(k) retirement 
plan with 2.3 million participants. All of us in the Office of the 
Chief Financial Officer--OCFO--and across USDA are proud of this 
achievement.
    Mr. Chairman, during the past year, I have consulted with OCFO's 
managers; its customers, both inside and outside USDA, our budget 
reviewers, members of the Congress, staff from the Office of the 
Inspector General, the Office of Management and Budget--OMB, and the 
General Accounting Office--GAO, and our counterparts in other Federal 
agencies about general and specific financial management problems 
facing USDA. I have taken seriously the USDA's Inspector General's 
statement that ``. . . a stronger CFO oversight process is needed to 
assure . . . longstanding problems are resolved on a coordinated 
department-wide basis.'' I can assure you and your colleagues that the 
Secretary and the Department's senior-level management share my 
commitment to improving financial management. I would like to thank 
Secretary Glickman for his support and leadership. I also want to thank 
you and your colleagues for placing such an emphasis on financial 
management issues. This budget request reflects Congress' quest for 
more efficient, effective Government.
    OCFO is playing a pivotal role in enhancing the Department's fiscal 
reputation. We have shouldered a lot of responsibilities in the last 
few years. As we have managed the Departmentwide implementation of 
Congressional mandates and executive orders, our budget continued to 
shrink.
    Mr. Chairman, if the Congress approves our request for an increase 
of $2,005,000 over our fiscal year 1999 appropriation, it will mark the 
first time since passage of the CFO Act of 1990 that the Department's 
financial management office has received a program increase in 
resources. We have done much to position ourselves to improve the 
financial health of USDA. I ask for this Committee's support for 
additional resources to fully implement the plans that we have 
developed.
    This budget request will be used to lead, direct, and oversee 
financial management activities across USDA. This increase in our 
budget will fund 14 positions to work with the agencies to improve 
their business practices and to help us accomplish the following 
objectives:
  --Ensure that USDA's information includes accurate, complete, and 
        credible data that are useful and used;
  --Provide the Congress and the Administration reliable information 
        when making decisions affecting USDA programs;
  --Resolve long outstanding Inspector General's recommendations 
        included in the audit reports;
  --Develop a USDA accountability report that complies with new 
        reporting requirements and streamlines existing reports, making 
        it easier for the public and Congress to access information 
        about our financial activities;
  --And, perhaps most important, lead USDA to a clean unqualified audit 
        opinion for fiscal year 2000.
    In a July 1998 report to the Vice President, we identified the 
plans of action that we are implementing to correct these deficiencies, 
which were outlined in the Inspector General's audit of our financial 
statements. This plan reflects a Departmentwide commitment to putting 
in place standard business processes that restore our credibility and 
correct the problems necessary for us to achieve an unqualified audit 
opinion.
    An unqualified audit opinion assures everyone--policymakers, 
managers, the Congress, program recipients, and the American taxpayer--
that USDA's financial management practices produce credible, reliable 
information that complies with laws, regulations, and accepted 
authoritative requirements.
    These efforts are directly linked to the implementation over the 
next five years of an integrated financial management system that 
Congress mandated in the CFO Act. However, while we can get a clean 
opinion using the system, the system alone, absent changes in financial 
management practices, will not get USDA a clean audit opinion.
    We need these budgeted resources not to do more of the same, Mr. 
Chairman. We need these staff resources to assist USDA's agencies to 
ensure that their business practices result in useful, reliable 
information going into this system.
    I place the highest priority on an integrated financial management 
system for USDA, the cornerstone of which is the Foundation Financial 
Information System--FFIS. FFIS is funded through the Working Capital 
Fund--WCF, but I want to make clear that the different funding sources 
do not separate the interdependence of these efforts. The successful 
implementation of FFIS rests on good business practices, procedures and 
a well-trained staff at the agency level. These additional appropriated 
funds will ensure that this implementation becomes a reality.
    In last year's testimony, I made a commitment to you to restructure 
the FFIS management organization. I am happy to report, Mr. Chairman, 
that the current FFIS project office is not the FFIS of previous years. 
With the Secretary's support and guidance, I obtained a waiver in June 
1998 from the Office of Personnel Management--OPM to bring an 
experienced project management team from another Federal agency. This 
team successfully implemented a system identical to the package that 
USDA is using and led its agency to an unqualified opinion on its 
administrative financial statements for fiscal year 1997.
    The project director reports directly to me and submits monthly 
updates to the Secretary's FFIS Executive Oversight Committee. The 
team, which started July 6, 1998, is putting in place an FFIS 
implementation plan that includes a schedule for full USDA 
implementation of FFIS by October 1, 2002.
    Since the new project structure's inception, we have conducted 
numerous meetings with Congressional groups. On September 23, for 
example, we joined senior-level GAO officials on a panel that briefed 
staff members from four House committees and two Senate committees on 
the Department's efforts to implement FFIS in our largest agency, the 
Forest Service. Both GAO and OMB support this new management structure.
    Implementing FFIS will enable USDA to provide useful, consistent, 
timely, reliable and accurate information to management, achieve 
conformance with legislative mandates, such as the Chief Financial 
Officers Act, and meet other Governmentwide requirements for financial 
management systems, processes and internal controls, including the U.S. 
Standard General Ledger. FFIS will also provide a platform for agencies 
and NFC to streamline current financial processes and systems. As part 
of the FFIS effort, we are developing the financial systems 
architecture and operating models necessary for the integrated 
financial management information system.
    As I said last year, my second priority is to fulfill 
responsibilities of accountability and performance measurement 
associated with implementing the Government Performance and Results 
Act. The Congress gave USDA a low score on its Strategic and Annual 
Performance plans because your colleagues did not consider USDA's 
information to be accurate, complete, and credible. We will use these 
additional resources to establish a staff dedicated to restoring 
accountability at USDA. We will assist the agencies in linking 
accountability with program delivery.
                          working capital fund
    Mr. Chairman, I would like to conclude my remarks by providing you 
with a brief update on our Working Capital Fund--WCF, which is entirely 
funded by fees for services. This Fund supports 20 distinct activity 
centers across five Department-level organizations. It also supports a 
number of projects and initiatives to modernize administrative and 
financial systems.
    In WCF, we develop our budgets in partnership with agencies. The 
Executive Committee comprised of agency representatives advises me on 
its funding level and use. This arrangement ensures that the 
Committee's recommendations reflect a ``customer'' voice in the 
operation and oversight of WCF activities and finances. Thus, the WCF 
budget reflects our partnership with our customers.
    For the current and next fiscal years, WCF spending consists of 
three categories: basic services, TSP, and modernization efforts.
    In the first category, our customers are paying in fiscal year 1999 
the same inflation-adjusted dollars for basic services, such as 
accounting services, payroll, and computer processing. It is our intent 
to achieve the same outcome in fiscal year 2000.
    In the second category, TSP, the costs of delivering services to 
TSP shareholders will increase, but the Thrift Investment Board will 
absorb these costs through investment earnings. Among TSP's 
enhancements is a new system scheduled to start in April 2000 that will 
provide daily valuation assessments and allow participants to modify 
their investments through the Internet.
    In the third category, the new FFIS management team's first task 
was to complete a new implementation plan and timetable for FFIS. This 
plan calls for full implementation of FFIS for USDA and cross-serviced 
agencies by October 1, 2002, with a post-implementation and close-out 
of the current Central Accounting System occurring in fiscal year 2003. 
Costs through fiscal year 2003 are expected to be $136.1 million, with 
the bulk of the expenditures occurring during the height of the 
implementation in fiscal year 2000 and 2001. The fiscal year 1999 
budget for FFIS is $23.7 million. The fiscal year 2000 and 2001 budgets 
are $32.5 million and $32.3 million, respectively. While these one-time 
implementation costs are straining agencies' budgets because additional 
funding has not been appropriated for this major project, the 
Department must continue to implement this new system to be compliant 
with Federal financial management laws.
    Our fiscal year 2000 WCF budget includes $4.2 million to upgrade 
our payroll/personnel system at NFC for our customers at USDA and in 
other federal agencies. As I mentioned earlier, NFC provides payroll/
personnel cross-servicing to a significant portion of the Federal 
sector, a practice that reduces overall user costs.
    We want to improve on our successes in the payroll arena, which 
will require us to upgrade or modernize existing systems to meet users' 
needs and maintain low costs. We must adequately invest in 
modernization efforts, so we do not jeopardize our service to existing 
customers or hinder our ability to attract new clients.
    This committee has recognized the cost-saving benefits associated 
with NFC's cross-servicing and has encouraged the expansion of this 
service at the center. To expand, however, we must produce a product 
that can compete in both price and quality of services. We have been 
investing in this area over the last two to three years and will have 
products available to our customers this spring.
    I pledge to you that, in addition to leading the effort to put 
USDA's financial house in order, I will give our effort to strengthen 
NFC's role in human resource systems and infrastructure a priority 
level equal to that which my office gave to achieving Y2K compliance.
    Mr. Chairman, Congress has given us the challenge of improving our 
performance, accounting for our financial resources, and managing our 
operations more effectively and efficiently. The budget that I am 
presenting to you is our commitment to achieving these shared goals.
    Thank you, Mr. Chairman. I welcome any questions the Committee 
might have.
                                 ______
                                 
                Office of the Chief Information Officer
 Prepared Statement of Anne F. Thomson Reed, Chief Information Officer
    Mr. Chairman, members of the Subcommittee, I will submit my 
testimony for the record and also offer a few remarks.
    As I stated last year, I am honored to have the opportunity to 
serve as the Chief Information Officer (CIO) of the United States 
Department of Agriculture (USDA). I greatly appreciate the opportunity 
to serve with Secretary Dan Glickman, Deputy Secretary Richard 
Rominger, my sub cabinet colleagues, and all of the employees of the 
USDA as we work too more effectively and efficiently deliver USDA's 
programs, which are vital to the health, safety, and economic 
prosperity of the American people, as well as people the world over. 
With the support and cooperation of the Congress, USDA is now stronger, 
abler, leaner, and more cohesive, and better able to serve our nation. 
Yet, as we all know, the Department faces significant challenges as we 
work to achieve the strategic goals which are reflected in the 
President's fiscal year 2000 Budget. The Department's strategic goals 
are to: Expand economic and trade opportunities for agricultural 
producers and other rural residents; Ensure food for the hungry, and a 
safe, affordable, nutritious, and accessible food supply; and Promote 
the sensible management of our natural resources.
    As you are well aware, the current farm crisis made achieving some 
of these strategic goals more difficult. The drop in agricultural 
commodity prices, the Asian economic crisis, and stiffer global 
competition for the American farmer have all resulted in increased 
demands on USDA programs. In the face of these demands and another year 
of tight funding, our challenge is to strategically harness new and 
existing technologies across USDA to vastly improve service delivery to 
our customers and help farmers weather the storm.
    Implementing IT solutions are complex tasks which all Federal 
Agencies--including the USDA--have historically had problems 
accomplishing. However, I believe our progress this past year shows 
that we are on the right path and, with your support, we can 
successfully meet the challenges before us. At USDA, our agencies 
demonstrate daily the cost savings, improved customer service, and 
other efficiencies to be gained when information technology is 
effectively utilized. For example, since I met with you last year, 
three USDA agencies have received Leadership Awards for setting 
examples of how government agencies get results--for taxpayers and 
constituents--from technology investment.
  --The Agricultural Marketing Service (AMS) now disseminates, via the 
        Internet, information on prices, volume, quality, and other 
        market data on domestic and international farm products within 
        hours of collection.
  --The Agricultural Research Service (ARS) allows dairy farmers to 
        pass on $60 million in savings to consumers as a result of 
        improvements in its genetic evaluations of the U.S. milking 
        herd, and the creation of electronic transfer access so 
        breeders can quickly access the data.
  --The Farm Service Agency (FSA) instituted a new Electronic Bid Entry 
        System so that bids for some $1.2 billion in food for farm aid 
        can be opened and contracts awarded in two hours. Up to the 
        minute market prices improve competition; the result is that 
        more people can be fed for each dollar in aid.
  --Using the Internet, the AMS conducted the first fully electronic 
        rule-making for a major regulation in the history of the 
        federal government. More than one quarter of a million comments 
        for the National Organic Program proposed rule were received by 
        fax, e-mail, and regular mail, and placed online. The ease of 
        submitting comments encouraged more people to participate--you 
        can call it an example of electronic democracy--making the 
        process the most open, publicly accessible rule-making ever.
    Mr. Chairman, we are proud of these accomplishments which provide a 
glimpse into the way our programs and services will be delivered in the 
future. Information technology today is radically transforming the way 
we live and work. In our personal lives, the Internet is rapidly 
changing the way we are accustomed to making transactions--everything 
from buying stocks, books, cars and homes, to applying for licenses and 
loans. At the USDA, it is changing the way we collect, analyze, and 
deliver information, making possible efficiencies that we could not 
have dreamed of just a few years ago. Yet, we have only begun to 
transform the way USDA does business.
      usda fiscal year 2000 information technology budget summary
    The Department's overall budget request for information technology 
in fiscal year 2000 totals $1.211 billion in budgetary authority. This 
compares with $1.198 billion in budgetary authority for information 
technology plus $37,789,000 for Year 2000 emergency supplemental 
funding in fiscal year 1999. Approximately 30 percent, or $379 million, 
of the fiscal year 2000 request is for development, modernization, and 
enhancement of USDA information technology resources, while almost 69 
percent, or $832 million, is required for maintaining current systems, 
including the operation and support of existing information technology 
systems.
    This budget reflects our priority that USDA IT solutions are 
aligned with program goals. For example:
  --By creating a uniform and shared information technology 
        infrastructure with the Service Center Initiative Common 
        Computing Environment (CCE), we are laying the foundation for 
        implementing reengineered programs. In fiscal year 2000, we are 
        proposing a total program level of $90 million for this 
        purpose, including about $16 million from the Commodity Credit 
        Corporation.
  --As the Forest Service continues to address changing notions of how 
        to use and protect our public land, Project 615 is integrating 
        the information necessary to manage our National Forests in a 
        more accessible environment. In fiscal year 2000, $102 million 
        is proposed for this effort.
  --A significant portion of the Department's IT funding, approximately 
        $280 million or twenty-three percent, is distributed to states 
        to support the information technology resources necessary to 
        run the Food and Nutrition Service Food Stamp Program. This 
        includes $43 million to expand and maintain the use of 
        Electronic Benefits Transfer (EBT) technology.
    Over the past year we have improved the Department's ability to 
properly manage these significant expenditures. However, we still have 
much work to do before we are managing our IT resources as envisioned 
by the passage of the Clinger-Cohen Act of 1996.
office of the chief information officer fiscal year 2000 budget request
    The USDA Office of the Chief Information Officer (OCIO) was 
established pursuant to the Clinger-Cohen Act. We have primary 
responsibility for supervision and coordination of the design, 
acquisition, maintenance, use, and disposal of information technology 
resources by USDA agencies. Our mission is to strategically acquire and 
use information technology resources to improve the quality, 
timeliness, and cost effectiveness of USDA's service delivery to its 
customers, and, increasingly, to ensure the security of the critical 
information that we manage.
    To carry out this mission, we are facilitating the alignment of our 
information technology investments with USDA's mission goals. We have 
developed performance measurements to monitor our progress and, more 
recently, we have begun developing a tactical plan to help us better 
manage our major initiatives. These initiatives include:
  --Overseeing implementation of a single information technology 
        infrastructure and supporting organization for the Farm and 
        Foreign Agricultural Services, the Rural Development agencies, 
        and the Natural Resources Conservation Service;
  --Developing policies and procedures to implement the Clinger-Cohen 
        Act through expanding the implementation of our enterprise-wide 
        architecture, strengthening our capital planning process, 
        implementing a formal IT project management training program, 
        and further developing our workforce planning strategies to 
        recruit and retain IT professionals;
  --Developing a USDA critical infrastructure assurance plan to secure 
        Department information and IT systems; and protect them against 
        cyber-terrorism and other threats;
  --Improving the Department-wide management of telecommunications; and
  --Assuring that our mission-critical information systems are Year 
        2000 compliant; an effort that will leave a lasting imprint on 
        OCIO well beyond January 1, 2000.
    We began our Year 2000 effort by enlisting the support of senior 
executive sponsors and staff in each agency to ensure we moved forward 
together, as a Department. Leveraging the USDA Information Systems 
Technology Architecture (ISTA) and the Telecommunications Enterprise 
Network Program, we jump-started the identification of all USDA mission 
critical systems--feeding this information back into the ISTA. We then 
refocused and strengthened our existing IT moratorium and capital 
planning processes to ensure all IT acquisitions were centered on Year 
2000 compliance. And now, we are coordinating our Year 2000 Business 
Contingency Planning with similar efforts to create a USDA Critical 
Infrastructure Assurance Plan.
    In a moment, I will discuss the initiatives mentioned above in 
greater detail. However, my office also manages the USDA National 
Information Technology Center (NITC) headquartered in Kansas City, 
Missouri. The NITC provides innovative, cost effective, and secure 
information technology solutions to support the missions of the USDA 
and its thirty-two agencies, the Federal Aviation Administration, the 
National Weather Service, and other government clients.
    My office oversees implementation of the Paperwork Reduction Act of 
1995 to reduce the paperwork burden for the public from the collection 
of information. Also, we coordinate the Department's records management 
functions to ensure that USDA's policies and transactions are 
adequately documented and archived.
    Fully implementing the initiatives we have begun will radically 
transform the way information technology is managed at USDA. To fully 
implement the Clinger-Cohen Act without unnecessary and costly delay, 
the USDA Office of the Chief Information Officer requests $7,998,000 
for fiscal year 2000, an increase of $2,447,000 and five staff years 
over the fiscal year 1999 appropriation of $5,551,000.
                               pay costs
    More than eighty percent of the OCIO's fiscal year 1999 obligations 
are for salaries and benefits. This leaves little flexibility for 
absorbing increased costs. For the past several years, we have received 
no added resources for pay cost increases. As a result, critical 
positions have been left vacant for extended periods. Despite our 
progress, which I will discuss, the inability to fill critical staff 
positions has adversely affected our ability to fully implement the 
Clinger-Cohen requirements and expeditiously achieve the goals we have 
identified. For these reasons, my office's budget includes a $197,000 
increase for pay costs, consisting of $35,000 for annualization of 
fiscal year 1999 and $162,000 for the anticipated fiscal year 2000 pay 
raise.
                   usda service center implementation
    I am also pleased to report that, even though significant 
challenges remain, we are making progress in our efforts to permanently 
transform the way USDA provides service to farmers and rural America 
through our Service Center Modernization Initiative (SCMI). At the same 
time, the current farm crisis makes it clear that we must accelerate 
our efforts if we expect our reduced staff to respond to cyclical 
emergency workloads of this type or natural disasters, without 
disrupting all of our other program delivery.
    The goal of reducing the number of county office locations from 
over 3,700 to under 2,600 is close to realization and should be 
complete this year. This represents the first step toward true ``one 
stop service'' for our customers.
    Another critical step is our progress toward creating a shared or 
Common Computing Environment (CCE) to replace the archaic ``stove 
pipe'' information technology systems of the past. The CCE will allow 
agency computers to talk to one another, utilize the Internet to 
improve service delivery, and reduce the burden on our customers. In 
fiscal year 1998, USDA obligated funds for more than 16,500 
workstations, at deeply discounted prices. This will allow us to 
install Y2K compliant computers while also moving forward with limited 
CCE investments to field already reengineered processes. These 
workstations will provide a set of common office automation tools; they 
will also be fully interchangeable: every new field office computer 
will be loaded with business applications from all of the partner 
agencies. An additional 5,500 computers will be purchased in fiscal 
year 1999 to complete the Y2K replacements. The remaining work stations 
will be addressed in fiscal year 2000 and 2001.
    Business Process Reengineering (BPR) is being used to analyze, 
streamline, and integrate like Service Center processes. The Service 
Center Modernization Initiative now has 17 active BPR projects dealing 
with customer management, program delivery, consolidated administrative 
processes, lending programs, and other critical processes. Fully 60 
percent of the Service Center business processes are in some stage of 
review. An Interagency Business Integration Center has been established 
at Beltsville, Maryland, to fully test the reengineered processes in a 
laboratory environment before sending them to one or more of the nine 
field pilot sites that were established last year. Early results 
indicate that the reengineered processes, coupled with enabling 
technology, are yielding significantly higher benefits than we 
originally estimated on some processes; staff time savings in excess of 
80 percent are being recorded.
    The LAN/WAN/Voice Project, which provides integrated voice and 
telecommunications networks to the Service Centers, is also nearing 
completion. At the end of fiscal year 1998, nearly 85 percent of the 
Service Centers were installed with the remainder to be finished in 
fiscal year 1999. This infrastructure will provide a set of 
``electronic railroad'' tracks for all future technology improvements 
to run on.
    Other technology components will also change the way these agencies 
do business. The technical infrastructure that has been developed is 
based on open, interoperable systems that are flexible and able to 
respond to changing programs, staffing, office and organizational 
structure. The infrastructure includes network servers to fully connect 
agencies to the network and provide common e-mail and other support; 
powerful business applications; public access servers; and Geographic 
Information System (GIS) servers, which support the business activities 
of these agencies that are associated with land and water 
characteristics, capabilities, and ownership. The fiscal year 2000 
Budget includes funds to begin acquiring these items. It is anticipated 
that, depending upon funding levels, the completion of the 
infrastructure will take place over three years. At that point, the 
full benefits of the Service Center Modernization Initiative can be 
achieved.
    Administrative Convergence and the creation in the 2000 Budget of a 
consolidated account for funding the Service Center Modernization 
Initiative are also essential for success, particularly with the 
Information Technology (IT) aspects. A consolidated IT staff will be 
able to take advantage of the efficiencies that a common architecture 
brings and will ensure that we do not revert to three stove pipes in 
the future. The consolidated account will facilitate decision making 
and priority setting on an enterprise basis and will help to improve 
tracking and accountability.
    In addition to the appropriations request, it is estimated that 
$16.2 million will be transferred from the Commodity Credit Corporation 
(CCC) to the Support Services Bureau to help support the new shared 
Common Computing Environment (CCE). These funds will be the remainder 
available under the current CCC cap for ADP expenses. Legislation is 
proposed to increase the cap by $105 million, to $293 million for the 
period through fiscal year 2002. This increase will enable CCC to meet 
the basic FSA ADP needs while supporting the investment in CCE.
    My office provides oversight to ensure that the business processes 
are appropriately reengineered and drive the technology decisions and 
that the Service Center technology is consistent with the USDA 
technical architecture. We have a two-person oversight staff currently 
financed by reimbursement from the fiscal year 1996 Appropriation to 
the Secretary for implementation of ``InfoShare,'' which was the 
predecessor to the SCMI, to carry out this function. We anticipate the 
reimbursement for this activity to end by fiscal year 2000. Therefore, 
an increase of $250,000 is requested to continue these positions with 
appropriated funds and to ensure that the USDA Service Center 
Modernization Implementation initiative achieves the Secretary's goals 
of better integrating services and modernizing delivery of programs 
administered by the Farm Service Agency, the Natural Resources 
Conservation Service, and the Rural Development mission area.
                        clinger-cohen compliance
    Since the creation of OCIO, we have been working to implement both 
the guidelines and spirit of the Clinger-Cohen Act of 1996. Given the 
inherent complexity of the task, I am happy to report that we made 
progress this past year expanding the USDA Information Systems 
Technology Architecture, improving the Department-wide and Agency 
Capital Planning Processes, and developing our IT workforce planning 
initiative. Together these efforts are improving the way the Department 
acquires and uses IT, and reducing costs while increasing the 
productivity of USDA programs.
            usda information systems technology architecture
    USDA actually began designing its ISTA prior to passage of the 
Clinger-Cohen Act. Our first version of the ISTA was a multi agency 
collaboration, which served as an essential guide for the LAN/WAN/Voice 
and CCE IT investments for the Service Center Modernization Initiative. 
However, to assure that the Department's overall technical 
infrastructure is interoperable, efficient, and provides effective 
support to achieve USDA's business goals, the ISTA requires further 
development and integration into Department-wide planning processes.
    The Service Center agencies' use of the ISTA provides an example of 
the important role of an information technology architecture in 
successful project implementation. With varying perspectives on what 
were the best information technology solutions among the Service Center 
Agencies, the technical portion of the ISTA provided a framework for 
the agencies to build on and begin establishing a consensus on what to 
purchase and implement. The purchase of the 16,500 CCE workstations 
would have been impossible without the development of the ISTA 
technical standards. Similarly, the technical architecture has 
facilitated the CCE consolidation of software licensing, improving our 
users' ability to share applications and data while reducing costs.
    Additionally, my office continues to expand and apply the initial 
version of the ISTA. Our update of the baseline architecture has 
focused on Agency business processes, information exchange 
requirements, the application portfolio, and identification of USDA 
functions and technology platforms. Thus the ISTA is a dynamic tool, 
which we are using in the selection phase of the Capital Planning and 
Investment Control and IT waiver processes to avoid duplication and 
ensure interoperability of all USDA IT investments.
    The ISTA will ultimately modernize and transform the way we all 
think about delivering programs and services to our customers. With the 
fiscal year 2000 funding, a web-based repository to house the ISTA 
combined with inter-agency ISTA training will inform programs and IT 
staff about existing processes, applications, and standards at the 
initial stages of a project. Further integration of the ISTA into the 
Capital Planning and Budget Processes will help guide investment 
decisions, continue to reduce duplication across agencies, and 
eventually result in greater interoperability of USDA's IT systems. The 
fiscal year 2000 funding request includes $500,000 to meet Clinger-
Cohen Act of 1996 requirements that Executive Agencies develop an 
information technology architecture.
                capital planning and investment control
    We have also made progress implementing an Information Technology 
Capital Planning and Investment Control (CPIC) process, another 
Clinger-Cohen requirement. We are following OMB and GAO guidelines to 
ensure that IT investments are made in direct support of business 
objectives, while maximizing the value and assessing and managing the 
associated risks. This is not an easy task, as economic, environmental, 
and policy changes require the Department to find new and flexible 
solutions which often involve significant investments in information 
technology. My office requires additional resources to implement the 
CPIC process consistently across USDA agencies and, most important, to 
ensure that these investments are properly managed.
    I am pleased to report that in 1998, USDA became the first large 
Federal Department to implement the Information Technology Portfolio 
System (I-TIPS), a scalable web-based software tool used to track IT 
projects as investments through the selection, control, and evaluation 
phases of the Capital Planning and Investment Control Process. Thirteen 
USDA agencies now use the I-TIPS selection module, exceeding our 
original performance goal of five. We developed I-TIPS in conjunction 
with the Department of Energy and the National Performance review. We 
are proud that in addition to USDA, I-TIPS is now being used in seven 
other Federal Departments.
    The use of I-TIPS as a tool to provide USDA decision-makers with a 
better picture of our IT investment portfolio is already producing 
results--allowing the Executive Information Technology Investment 
Review Board (EITIRB), which is chaired by the Deputy Secretary, to 
make more informed decisions in its review and approval of the 
Department's IT investment portfolio.
    In addition, my office has produced a USDA CPIC guide for senior 
decision-makers and agency planning staff. The guide explains the 
fundamentals of capital planning and how we are integrating the OMB 
guidelines and GAO model for CPIC into the USDA IT investment process.
    Still, the design and implementation of a USDA-wide CPIC program 
and support system is a multi year effort which requires a permanent, 
ongoing program management staff. Skilled staff is needed to perform 
and review cost-benefit, return on investment, and other detailed 
analyses of IT investments in order to reduce as far as practical the 
risk of failure in the development, deployment, and operation of USDA 
information technology systems. The funding we have requested would be 
used to train the agencies in the process and the I-TIPS tool to ensure 
that capital planning is applied consistently throughout our 
organization.
    The benefits of a successful CPIC program are clear: IT investments 
by USDA agencies that meet their program objectives on time and within 
cost projections, and which support business objectives. I am 
requesting $500,000 in fiscal year 2000 to meet the capital planning 
requirements of the Clinger-Cohen Act of 1996 and the OMB Circular A-11 
Part 3 requirement that Federal agencies intensify their review and 
analysis of information technology systems as capital assets.
                           project management
    We are also taking steps to address deficiencies in USDA's 
management of major information technology projects, an area cited by 
oversight agencies in recent years. In order to reduce risk in the 
development, deployment, and operation of information technology 
systems, my office is creating a formal project management 
certification program. This program will establish a standardized 
methodology for project management: projects will be managed 
consistently, resulting in increased success rates, and avoidance of 
cost overruns and delays. At the same time, managers will be provided 
with sound performance measurement tools. This initiative will also 
help meet the project management requirements of OMB Circular A-11 Part 
3, Planning, Budgeting, and Acquisition of Capital Assets, by 
establishing and providing the means to track cost, schedule, and 
performance goals. In fiscal year 2000, I am requesting an increase of 
$300,000 and 2 staff-years to strengthen USDA's project management 
capacity.
                independent verification and validation
    Mr. Chairman, we have also made progress with respect to two other 
very important management tools which I would like to mention: 
Independent Validation and Verification (IV&V) and our Acquisition 
Moratorium.
    Independent Validation and Verification (IV&V) is now a standard 
policy tool that my office uses to manage all large-scale USDA IT 
investments. At critical points in a project's life-cycle, independent 
experts review the issues surrounding project design, development, 
acquisition, and implementation.
    For example, this past year an IV&V conducted by my office 
validated the Service Center Modernization Initiative's Common 
Computing Environment's cost/benefit analysis and technical alternative 
plans. This ensured that all appropriate business and technical details 
were included in the plans before any further steps were taken. Another 
IV&V on the Department's Foundation Financial Information System 
refocused the project in a new and sound direction, improving the value 
of the resources being allocated and the probability of the project's 
success.
    In the coming year, we will continue to apply the lessons learned 
from previous IV&Vs in order ensure all significant IT investments cost 
effectively serve USDA program goals.
                       it acquisition moratorium
    In compliance with our fiscal year 1999 appropriation (Public Law 
105-86), my office, together with the Executive Information Technology 
Investment Review Board, continues to review all USDA information 
technology investments to ensure new purchases are directed at bringing 
the Department into Year 2000 compliance. Any Departmental or Agency 
information technology acquisition over $25,000 requires a waiver from 
my office. These waivers are granted for emergencies and Year 2000 
remediation efforts only.
    The USDA IT investment moratorium is a success. Since Deputy 
Secretary Rominger originally issued the moratorium in November of 1996 
to improve the Department's IT management, we have been better able to 
monitor agencies' use of funds while improving our IT decision-making 
processes. And, since Secretary Glickman modified the IT acquisition 
moratorium in August 1997, agencies have redirected a great deal of 
attention and dollars to Year 2000 compliance.
    The IT acquisition moratorium, together with IV&V reviews have 
greatly improved our ability to ensure that USDA's IT projects meet 
USDA's business objectives and are effectively and efficiently managed.
       information technology workforce planning and development
    My office is also actively working on a professional development 
strategy to ensure that USDA's IT staffs possess the technology skills 
necessary to effectively deliver USDA's programs and services. In light 
of the current worldwide shortage of IT professionals, there is a clear 
urgency in our efforts to attract and retain qualified technical staff 
to support the Department's modernization efforts.
    As competition for IT professionals grows more intense, we face the 
growing challenge of keeping our skilled IT professionals. USDA is 
experiencing a loss of skilled IT professionals from increased 
competition with the private sector, and through buyouts and 
retirements. Since 1994, we have lost more than 11 percent of the IT 
professionals within the Department.
    My office is collaborating with the Office of Human Resources 
Management and the USDA IT Workforce Planning and Development Working 
Group, a group composed of HR and IT specialists from several of the 
Department's agencies, to address this problem by providing USDA 
managers with recruitment and retention alternatives and flexibilities. 
IT employees within government know that they will not receive salaries 
comparable to the private sector; however, we can provide more 
flexibility in their work schedules, greater opportunities for career 
development, and management that is more sensitive to all of their work 
place concerns.
    We are also working to implement a set of core competencies for 
USDA IT professionals which were developed by the CIO Council. In this 
effort, the Deputy Chief Information Officer, Ira Hobbs, as co-chair of 
the CIO Council's Education and Training Committee, is playing a 
leadership role in the adoption of these competencies across 
government. Together, these efforts support my office's management 
initiative to implement a professional development strategy to ensure 
that USDA's program and IT staffs possess the skills necessary to meet 
the challenges of effectively delivering programs and services with 
information technology. For fiscal year 2000, I am requesting an 
increase of $200,000 and 1 staff year to improve USDA's information 
technology workforce planning and development effort and to expedite 
the implementation of the component of the Clinger-Cohen Act of 1996 
dealing with workforce development.
                           telecommunications
    USDA also faces significant challenges with respect to improving 
the management of our telecommunications infrastructure. This past 
year, we have made progress analyzing and optimizing our 
telecommunications network while preparing for the Year 2000 date-
change and the upcoming transition to the new GSA FTS2001 
telecommunications contract. As the telecommunications industry moves 
from older voice to more advanced data technologies, it is crucial that 
the Department continue to put in place a USDA corporate 
telecommunications network that includes management processes and the 
infrastructure necessary to efficiently meet the needs of our programs 
today while planning for the services our customers will demand 
tomorrow.
    The work we have done this past year on the Telecommunications 
Enterprise Network (TEN) Design and the Telecommunications Ordering, 
Billing, and Inventory System (TOBI) projects are vital steps to 
establishing a USDA enterprise-wide network. The TEN Design project 
captured the current network baseline physical description along with 
usage, cost, and performance statistics. The TOBI pilot project 
combines a revised administrative process with an off-the-shelf 
software application to improve the control and accounting of USDA 
telecommunications acquisition. These design initiatives together with 
our recent implementation successes represent the first steps toward a 
cost effective enterprise network plan.
    As I mentioned earlier, the Service Center LAN/WAN/Voice project is 
providing the shared voice and data telecommunications infrastructure 
necessary to present one-face to our customers at reduced costs. 
Similarly, the Washington Metropolitan Area Optimization Project (WMAO) 
has successfully optimized our headquarters network, generating $1.3 
million in cost avoidance since February 1998, allowing agencies to 
redirect these dollars toward their program activities. In the short-
term, the WMAO project is reducing USDA costs in the Washington 
Metropolitan Area (WMA) while expending minimal expense and time. The 
long-term objectives are to implement a cost effective and centralized 
Configuration Management capability and provide enhanced Network 
Services for all USDA offices in the WMA.
    Over the next year, we face significant challenges transitioning to 
the FTS2001 contract while continuing to reform our telecommunication 
management process and infrastructure. Through strong management 
processes we will integrate, optimize, and modernize current services. 
The FTS2001 transition also provides us a tremendous opportunity to 
refine and improve the Department-wide telecommunications network 
design, security, management, and standards development. The challenges 
associated with administratively managing two networks will be 
significant while simultaneously managing the implementation, 
operation, and disconnection of services.
    Greater emphasis is being placed on aligning program delivery with 
appropriate IT solutions. More efficient use of telecommunications 
personnel, equipment and services will be achieved through 
institutionalizing structured processes in which IT activity within 
USDA and its agencies is directed toward building a common information 
infrastructure for the greater agriculture community of interest.
    To meet these challenges, I am happy to report the addition of a 
new Associate Chief Information Officer of Telecommunications Services 
and Operations to my senior management team. Filling this position has 
already significantly enhanced our ability to provide day to day 
leadership while assuming long term strategic planning responsibilities 
for the network.
                    information technology security
    Information technology officials across the Federal government 
today agree that information security will be the next priority IT 
issue following Year 2000. Every day, the information that USDA 
agencies manage affects the financial markets and lives of individuals. 
We must exercise due diligence in its protection. As we achieve greater 
ease in the dissemination of information, the Department must walk a 
fine line between information exchange and information protection: this 
is especially important in an age of instant access and global 
exchange. As networks expand and connect, security concerns will expand 
exponentially.
    In May 1998, President Clinton signed Presidential Decision 
Directives (PDD) 62, ``Combating Terrorism,'' and PDD 63, ``Protecting 
America's Critical Infrastructure.'' These directives lay out a 
dramatically new approach to protecting the nation against 
unconventional threats and assign new responsibilities to agencies for 
protecting their critical infrastructures, especially their cyber-based 
systems.
    To meet these new requirements, we established a USDA Critical 
Infrastructure Assurance Task Force, consisting of security and 
telecommunications specialists. The task force is charged with 
developing a plan to heighten awareness about risks to our information 
systems and strategies, and cost-effectively and efficiently protect 
USDA's critical infrastructure.
    Plans, policies, and procedures must also be centrally developed 
and managed to afford the greatest protection to the Department as a 
whole. Without them, it is reasonable to assume that unauthorized 
intrusions will continue and probably increase in both frequency and 
severity. Currently, my office provides Department-wide guidance and 
training on information security issues. Departmental policies either 
issued or currently under review focus on software piracy, e-mail 
security and privacy, and Internet firewall and network incident 
responses. My office also participates with leading government security 
organizations to ensure the Department's security policies and 
practices are up-to-date.
    The additional staff year and funding that I have requested are 
necessary to thoroughly examine our critical infrastructures, identify 
vulnerabilities, develop strategies to mitigate unacceptable risk, and 
fully meet requirements of PDD 62 and PDD 63. The staff-year will serve 
as the Contracting Officer Technical Representative and administer the 
contracts required for this initiative and related critical 
infrastructure protection projects which address continuity of 
government and disaster recovery requirements.
    Current USDA spending on information technology security as a 
percentage of total IT spending is about ten times below the industry 
average. Thus, coordination by my office is essential to leverage 
agency and Departmental Administration resources and ensure USDA's 
Critical Infrastructure Assurance plan is thorough, effective, and 
economical. For this purpose, I am requesting an increase of $500,000 
and 1 staff-year in fiscal year 2000 to support USDA information 
security initiatives.
                           year 2000 strategy
    Along with security, our highest priority is to ensure that USDA's 
programs and services are not adversely affected by the Year 2000 
problem. The Department continues to maintain a strong management 
approach to effectively respond to the challenges of Year 2000 
remediation and ensure that our systems and operations are Year 2000 
compliant. We have expanded our efforts in several areas since I met 
with you last year. During the past year USDA has:
  --Expanded the responsibility and accountability for Year 2000 
        remediation to all agency senior executives by establishing a 
        critical element in their performance standards.
  --Provided Department-wide guidance in several areas of Year 2000 
        remediation, including testing, independent validation and 
        verification, and business continuity and contingency planning. 
        This guidance has followed the General Accounting Office 
        approach.
  --Continued to enforce a procurement moratorium requiring CIO 
        approval of any IT acquisition over $25,000
  --Requested and received $37,789,000 in supplemental emergency 
        appropriations for Year 2000 conversion, for which I thank you 
        and the Committee members. This money is being applied to 
        remediation efforts in the areas of business continuity and 
        contingency planning, testing and validation, equipment and 
        facilities with embedded chips, hardware and software 
        improvements, outreach and technical assistance.
  --Completed the development of mission area business continuity and 
        contingency plans. Each mission area has examined their 
        strategic goals and objectives and identified their core 
        business processes to ensure business continuity for all 
        programs and services.
  --Conducted independent validation and verification assessments of 
        Year 2000 remediation in several areas, including systems 
        remediation, buildings and facilities, and program management.
  --Took a leadership role on the President's Council on Year 2000 
        Conversion, including membership on most of the Council's 
        working groups which cover various sectors. These include: 
        benefits payments, building operations, education, emergency 
        services, energy (electric power), finance (banking, guarantee 
        agencies & investments), health care, housing, human services, 
        insurance, international trade, science & technology, small 
        business, telecommunications, transportation, and water & 
        wastewater. USDA chairs the Food Supply Working Group where we 
        are leading assessment and outreach to the food supply sector.
  --Expanded the usage of an Internet-based reporting system which 
        allows agencies to input system information, including 
        descriptions, milestones, and current status, and information 
        from contingency plans. The information provides USDA with a 
        ``real time'' status of Year 2000 remediation which assists 
        managers, oversight organizations and the general public who 
        have an interest in the progress of USDA's Year 2000 efforts.
    The most recent quarterly report to the Office of Management and 
Budget was submitted in February 1999. As of March 1, 1999, we are 
tracking 353 systems, of which 285 (81 percent) are already compliant. 
We have designated 52 of those mission-critical systems as Departmental 
Priority systems, which have major impact regarding Americans' health, 
safety or finances, or have significant economic impact. Of the 266 
mission-critical systems being repaired, 260 (98 percent) are now 
renovated, 245 (92 percent) are now validated and 234 (88 percent) are 
now compliant. There are 32 mission-critical systems scheduled for 
repair which have not completed the entire repair process. All are 
expected to be implemented by March 31, 1999. There are 30 systems 
remaining to be replaced. All but six mission critical systems are 
expected to be implemented by March 31, 1999. Once a system has 
completed the repair or replacement process, the Agency Executive 
Sponsor must certify the system as Year 2000 compliant, thereby 
ensuring the system fulfills its program as well as technical 
requirements.
    Even though we have made significant progress, our work is far from 
done. During the remainder of this year we will continue to work on our 
non-mission critical systems. We are redoubling our efforts to assure 
that our facilities, laboratories, and telecommunications equipment are 
functional. And we will continue to test all of our systems to assure 
that the Department is fully prepared well before January 1, 2000. 
Recognizing that not everything is within our immediate control, we 
will also focus on business continuity requirements and continue to 
make contingency plans so that all of our programs will be delivered 
even if some glitches do occur. We are also continuing to work with all 
of our partners, state and private, to ensure that food stamps, other 
nutrition programs, loan and other programs will not be adversely 
affected.
    And we will continue our work with the President's Council on Year 
2000 Conversion where USDA heads the Food Supply Working Group and has 
representation on fourteen other working groups. We will continue to 
work with the food industry to access the Year 2000 state of readiness 
of the food supply, and provide the American public accurate 
information so they can make rational, as opposed to irrational, 
preparations for January 1, 2000.
                               conclusion
    Mr. Chairman and members of the Committee, let me conclude by 
saying again that I am privileged to serve as the Chief Information 
Officer at the USDA.
    These are exciting and challenging times. As I have indicated, we 
are making progress toward meeting all of the challenges before us. 
However, our work is far from done, and in some respect USDA is still 
at the very beginning of what will clearly be the most far reaching 
transformation in its history.
    USDA, like all of government and the private sector, is faced with 
a tremendous opportunity to harness new technologies that are forever 
changing the way we deliver programs and provide services to the 
American people, improving our efficiency and our effectiveness. As we 
do this, we must face the emerging cyber-terrorist threat by protecting 
our critical information infrastructures. To meet these challenges, we 
must effectively manage the substantial resources which you have 
entrusted to us on behalf of taxpayers. During the past year, we have 
moved forward in implementing some important management tools to help 
us get the job done. With your help, we will continue to move forward.
    I look forward to working with you, and I will respond to any 
questions you have at this time.
                                 ______
                                 
                         Office of Civil Rights
            Prepared Statement of Rosalind D. Gray, Director
    Mr. Chairman and Members of the Subcommittee, I am pleased to 
present the fiscal year 2000 budget request for the Office of Civil 
Rights. I was appointed Director, Office of Civil Rights, on July 13, 
1998, and have full responsibility for civil rights at USDA. Last year 
the Acting Assistant Secretary for Administration presented the budget 
statement and reported to you on the first year's progress in 
implementing the Civil Rights Action Team's--CRAT--recommendations for 
strengthening civil rights and diversity efforts at the Department of 
Agriculture--USDA. Today I am reporting on additional progress we have 
made toward moving USDA to a stronger position and record on civil 
rights enforcement.
        treat all fairly and equitably with dignity and respect
    The Department's overall civil rights and diversity goal is to 
treat every customer and every employee fairly and equitably, and with 
dignity and respect. We have implemented new policies and procedures to 
achieve that goal. More than two dozen Departmental regulations and 
directives have been drafted and issued. Training and assistance is 
being provided to help the agencies assure that all employees 
understand and practice the new policies, procedures and guidelines. 
Also, an accountability system has been put in place to help assure 
that all employees comply with the intent of our new civil rights 
effort.
        assure all have full access to all programs and services
    Another major civil rights goal is to assure that all potential 
customers have access to all USDA programs and services. All USDA 
employees have been asked to study and comply with the February 25, 
1998, ``Equal Opportunity Public Notification Policy''--Departmental 
Regulation 4300-3, the January 14, 1998, policy on ``Communicating with 
Under-served Customers''--DR 4360-1, and the March 16, 1998, ``Civil 
Rights Policy for the Department of Agriculture''--DR 4300-6. These 
directives delineate USDA policy and assure that all customers have 
access to USDA programs and services. In addition, the 
nondiscrimination statement is displayed in all offices and on all 
publications, making information about programs and services available 
to all through concerted efforts using alternative formats for those 
with sight or hearing impairments or for those who need the information 
in alternative languages. In partnership with community-based 
organizations and other groups, we use nontraditional communication 
channels to reach the hard-to-reach, and make all offices and meeting 
facilities handicap-accessible.
              staff reflect the diversity of the community
    Another major civil rights and diversity goal of the Department is 
to eliminate under-representation of minorities, women, and people with 
disabilities in the workforce by recruiting and employing a highly 
skilled, competent and diverse workforce. The Department will create a 
workforce that reflects the diversity of the community. Recruiting 
efforts are expanding to better reach under-represented candidates. 
Agencies are required to do workforce climate surveys of their 
employees each year and exit interviews when employees leave the agency 
in order to surface employees' issues and assess employees' 
satisfaction with working conditions. Moreover, agencies are required 
to assess the reason for complaints and to take the corrective action 
necessary to improve conditions that may cause under-represented 
employees to prematurely leave the agency. Also, we have created a 
``USDA Training and Development Consortium,'' that is responsible for 
providing the leadership for competency-based training of supervisors 
and managers. Interactive training will enhance ``people skills'' and 
is critical for establishing and maintaining a positive work 
environment that encourages and supports a diverse workforce.
                    most backlog complaints resolved
    In 1999, the Department entered a consent decree with the 
Plaintiffs in the class action lawsuit, Pigford vs. Glickman. The 
consent decree provides for processing African American farmers' 
discrimination complaints filed between January 1, 1981, and December 
31, 1996.
    We have resolved most of the old backlog of complaints that dated 
back as far as the early 1980's. There were 1,088 program 
discrimination cases in the backlog. The backlog cases are resolved 
with the exception of 10 cases where complainants did not accept a 
resolution offer, 8 assisted cases which require further investigation, 
and the class member cases. The program discrimination cases in the 
backlog that were part of the consent decree will generally be 
processed outside the Department. In addition, more than 1,500 of 2,142 
cases that were in the backlog of employment discrimination cases are 
resolved.
    In October 1998, we established the Early Case Resolution Taskforce 
to prevent or reduce the further delay in the resolution of 
discrimination complaints that were filed with USDA and, subsequently 
backlogged, and ensured that cases previously closed were done in 
accordance with CR policies and regulations. Departmental regulations 
for processing employment and program discrimination complaints have 
been approved and procedures for implementation are drafted. The new 
complaints process is designed to resolve program discrimination 
complaints in a timely manner--generally within 180 days.
                     other specific accomplishments
    A new Conflict Resolution Center and new conflict management 
policies and procedures will lead to early resolution of many conflicts 
and misunderstandings before they become formal complaints. Early 
intervention, mediation and alternative dispute resolution will be used 
throughout the Department.
    State Outreach Councils in each State to provide leadership and 
coordinate efforts to assure that all potential customers have full 
access to all USDA programs and services. These councils are made up of 
our top USDA agency heads in the State, key State officials such as the 
State Commissioners of Agriculture, and elected officials of State, 
local, and tribal governments.
    Every USDA employee is required to have training in civil rights 
and diversity. Training is also offered to many cooperators, committee 
members, and volunteers. All who interact with our customers must 
understand our civil rights policies and regulations.
    Special management training is provided to our top and mid-level 
managers and supervisors because many of the discrimination complaints 
stem from poor management practices such as simply not communicating 
well enough with customers and employees so that they understand why 
certain decisions are made.
    Some loan application forms have been simplified so that it is less 
burdensome and time-consuming to apply for a small loan. In addition, 
the time required to approve some of our loans has been reduced.
    For the first time in USDA history, agency managers are being held 
accountable--at the Department level--for achieving annual civil rights 
objectives. In fiscal year 1998, the Assistant Secretary for 
Administration--ASA--and I, as Director of Civil Rights, rated the 
agency administrators and staff office directors on their civil rights 
performance.
    In fiscal year 1998, USDA focused on the process and procedures 
whereby agencies would be accountable for civil rights. The agencies 
were required to provide monthly reports on their progress in 
fulfilling the CRAT recommendations. The Office of Civil Rights 
received the data, assessed it, and the ASA and Civil Rights Director 
provided feedback to the agencies about whether or not they were 
fulfilling the intent of the CRAT recommendations and fully 
implementing the new civil rights policies and procedures.
    In fiscal year 1999, we are continuing to hold the agency heads and 
staff office directors accountable for civil rights. However, this year 
the focus is more on the achievement of end results.
    Special attention is being given to holding agencies accountable 
for taking documented, positive actions resulting in: disciplining 
managers and employees who discriminate, complying with settlement 
agreements, improving workforce diversity, and holding all managers and 
employees--at headquarters and the field level--responsible and 
accountable for civil rights.
    Agencies are expected to produce concrete results from increased 
attention to civil rights. For example, we expect agencies to report 
increases in service to small, minority, and women-owned firms, and 
other under-served farmers, businesses, and organizations. We also 
expect agencies to show evidence that their efforts to diversify the 
workforce--at all grade levels and in all occupations--actually 
resulted in a more diverse workforce.
                 office of civil rights budget request
    Within the amount requested for Departmental Administration for 
fiscal year 2000 is a budget request of $14,868,000 for Civil Rights. 
This is $2,041,000 over the fiscal year 1999 level of funding for Civil 
Rights. It includes $802,000 to improve employment complaints 
processing, and to enhance information system management, and $837,000 
to prepare for case increases due to cases that are now eligible for 
processing under the statute of limitations waiver for program civil 
rights complaints. Mandatory pay cost increases will require $402,000.
                               conclusion
    Mr. Chairman and members of the Subcommittee, we are making good 
progress toward our goal of treating all customers and employees fairly 
and equitably with dignity and respect. I appreciate the very strong 
support this Subcommittee has given us. I welcome any questions that 
you may have.
                                 ______
                                 
                        Office of Communications
     Prepared Statement of Tom Amontree, Director of Communications
    Mr. Chairman and members of the Subcommittee, I am pleased to 
discuss the fiscal year 2000 request for the Department of 
Agriculture's Office of Communications--OC.
    As Congress defined in 1862 what would become today's U.S. 
Department of Agriculture, a major goal of that law was to charge the 
Agriculture Department with the responsibility to acquire and 
disseminate to the people of the United States information on subjects 
connected with agriculture. The communication coordination that fully 
implements that mandate is directed today by the Office of 
Communications.
    The public learns about USDA's programs, functions and initiatives 
through a centrally coordinated communications effort led by the Office 
of Communications. Customers and constituency groups, who depend on the 
Department, are served directly by communication activities that span 
all of USDA's seven major mission areas. At the same time, the Office 
of Communications provides leadership and central services that enhance 
communications with USDA's employees throughout the Nation.
    The Office of Communications is adopting new technologies to meet 
the increased demands for information. Using the Internet's world wide 
web, radio, television and teleconference facilities, we are able to 
ensure that the millions of Americans whose lives are affected by 
USDA's programs receive the latest and most complete information. The 
Office of Communications' 5-year strategic goal is:
    To support the Department in creating a full awareness among the 
American public about USDA's major initiatives and services. A complete 
knowledge by the general public--and specific publics, including USDA 
employees--about USDA initiatives, policies, and programs is essential 
to effective customer services and efficient program delivery and 
should result in more citizensespecially those in underserved 
communities and geographic areasavailing themselves of USDA services 
and information that will help them in their daily lives.
    The Office of Communications will continue to take an active part 
in policy and program management discussions, coordinating the public 
communication of USDA initiatives. OC will continue to provide 
centralized operations for the production, review, and distribution of 
USDA messages to its customers and the general public, and OC will 
monitor and evaluate the results of these communications.
    The Office of Communications will continue to acquire and instruct 
staff in using the most effective and efficient communications 
technology, methods, and standards in carrying out communications 
plans.
    OC intends to improve communications with USDA employees, 
especially those away from headquarters. OC will help employees 
understand USDA's general goals and policy priorities, to become more 
familiar with USDA programs and services, and to understand 
initiatives, especially cross-cutting ones, and how they relate to each 
employee's specific job duties.
    Our office is working hard to ensure compliance with Government 
Performance and Results Act. We will work to update USDA regulations 
and guidelines for communications; conducting regular training sessions 
for USDA communications staffs about using communication technologies 
and processes to enhance public service; fostering accountability for 
communications management performance throughout USDA; and continuing 
to work to create a more efficient, effective and centralized Office of 
Communications.
    The Office of Communications will provide equal opportunity for 
employment and promote an atmosphere that values individual 
differences. OC will continue to provide equal opportunity for 
contracting goods and services. OC will increase availability of USDA 
information to underserved communities and geographic areas to ensure 
equal opportunity in USDA's outreach efforts, and will continue to 
develop universally accessible information products.
                    fiscal year 2000 budget request
    The Office of Communications is requesting a budget of $9,300,000. 
This is a net increase of $1,162,000 over our fiscal year 1999 
appropriation. The net increase would cover additional personnel costs 
of $303,000 for pay costs, $588,000 for Electronic Access to 
Information, $70,000 for an Outreach and Education Program for 
Underserved Groups, and $201,000 to cover increased costs of critical 
Department-level communications coordination and dissemination. This 
effort is directly related to OC's accomplishment of its annual 
performance goal to improve communication efforts with the public and 
agricultural industry through live satellite teleconferences, radio, 
and television special programs.
    Without the funding for the Electronic Access to Information 
initiative, the Office of Communications will be seriously handicapped 
in providing information in the format and with the timeliness required 
by USDA clientele and the American public. Specialized computer and 
digital equipment are required to record, edit and prepare messages 
acceptable to the media and accessible to the public through the 
Internet. State-of-the-art computers are needed by the streamlined 
Office of Communications staff to effectively perform its internal 
communications coordination function, as well as to promptly and fully 
respond to this surge of interest to acquire audio, video and print 
information electronically.
    As fiscal year 2000 begins, we will be in the final, critical 
stages of information dissemination that will assure the American 
public that food security will not be adversely affected by year 2000 
issues. The $201,000 request is essential for us to expand the 
communications efforts that will let an informed public respond 
appropriately to this potential crisis. Additionally, we require 
$70,000 for an expanded outreach and education program for underserved 
groups. The $303,000 request for pay costs comes at the end of 3 years 
of straight-lined funding and is needed to maintain an already 
significantly downsized Office of Communications.
    Office of Communications' initiatives are modest, but crucial 
requests that will place the Office of Communications in the best and 
most responsive position for meeting communications needs of our 
customers and the American public in the 21st Century.
    This concludes my statement, Mr. Chairman. I will be pleased to 
respond to any questions.
                                 ______
                                 
                     Office of the General Counsel
        Prepared Statement of Charles R. Rawls, General Counsel
                              introduction
    Mr. Chairman and members of the Subcommittee, I am pleased to have 
this opportunity to present our fiscal year 2000 budget request and to 
also provide you with an overview of our agency to include some of the 
current activities and issues facing the Department.
                                mission
    The Office of the General Counsel (OGC) is the law office for the 
Department. As an independent, central agency within the Department, 
OGC provides all legal services necessary to support the programs and 
activities of USDA. OGC provides legal advice and services to the 
Secretary of Agriculture and other officials of the Department of 
Agriculture with respect to all USDA programs and activities.
                              organization
    OGC's services are provided through 12 Divisions in Washington and 
18 field locations. The headquarters for OGC is located in Washington, 
D.C. The Office is directed by a General Counsel, a Deputy General 
Counsel, a Director for Administration and Resource Management, and six 
Associate General Counsels. The attorneys located in headquarters are 
generally grouped in relation to the agency or agencies served. Our 
field structure consists of five regional offices, each headed by a 
Regional Attorney, and 13 branch offices. The field offices typically 
provide legal services to USDA officials in regional, State, or local 
offices.
    Currently, we have on-board, 234 attorneys and 113 support staff, 
including paralegals, in the Washington, D.C. headquarters and field 
locations. Approximately half of our personnel are located in the 
field.
                     current activities and issues
    During the past year, OGC has supported the activities of the 
Foreign Agricultural Service (FAS) in the implementation of a number of 
major initiatives and we anticipate the need for significant continuing 
involvement in the coming year. Our involvement in these areas will 
include assisting the Office of the United States Trade Representative 
(USTR) and FAS officials with enforcement of the commitments received 
in the Uruguay Round Agreement on Agriculture and providing assistance 
in pursuit of additional commitments in future negotiations. We also 
anticipate extensive involvement in foreign assistance activities as 
FAS carries out implementation of extensive humanitarian aid 
initiatives.
    OGC will continue to play an instrumental role with respect to the 
formulation and implementation of international trade-related 
agreements such as the Mutual Recognition Agreement concerning 
veterinary biologics and the International Plant Protection Convention, 
as well as having a role in preparation for the World Trade 
Organization (WTO) Sanitary-Phytosantiary Committee meeting. OGC has 
been and will continue to be involved in the preparations for the new 
round of WTO negotiations to strengthen international trading rules and 
in addressing specific issues such as credit and credit guarantees and 
expanded free trade in the Americas.
    OGC will continue to be actively involved in the development and 
application of present international trading rules. The United States 
has recently invoked the WTO dispute settlement procedures in several 
agricultural matters with significant OGC involvement. For example, we 
anticipate continued participation in WTO proceedings challenging the 
European Union's (EU's) export subsidy on processed cheese, Japanese 
phytosanitary issues and Canadian dairy export subsidies and access for 
U.S. products, as well as ensuring EU compliance with the WTO decision 
striking the ban on imports of meat produced with growth-promoting 
hormones. OGC has also been active in consultations with South Korea 
regarding access to its market and in connection with issues involving 
the Israel Free Trade Agreement.
    During the past year, OGC has also been involved in the 
implementation of major initiatives relating to foreign assistance that 
will continue to demand attention during the coming year. One of the 
major OGC accomplishments during this past year was the development of 
the legal framework for the removal of surplus wheat from the domestic 
market under the authority of the Commodity Credit Corporation (CCC) 
Charter Act and the subsequent disposal of these commodities by CCC in 
support of the ``President's Food Aid Initiative.'' Under this 
initiative, CCC is exporting a large volume of wheat to meet 
humanitarian food needs overseas under section 416(b) of the 
Agricultural Act of 1949. Similarly, OGC provided extensive assistance 
to FAS officials as they concluded an understanding with the Russian 
government on key elements of a food assistance package totaling 3.1 
million tons of agricultural commodities. The package includes a 
donation of 1.5 million tons of wheat under section 416(b) as well as 
concessional sale activity under Public Law 83-480 involving a variety 
of U.S. agricultural commodities. In addition, OGC reviewed numerous 
documents relating to the donation of another 100,000 tons of various 
commodities to private relief organizations conducting operations in 
Russia.
    OGC continues to be actively involved in other FAS and CCC foreign 
program areas, including export credit, supplier credit, and facilities 
guarantee programs. We anticipate that there will be significant 
increases in requests for OGC assistance in fiscal year 2000 due to the 
upcoming round of negotiations on agriculture in the WTO and the 
continued efforts of the Department to increase exports in response to 
the various financial crises around the world.
    Attorneys in OGC have continued to provide assistance in the 
Production Flexibility Contract Program authorized by the Federal 
Agriculture Improvement and Reform Act of 1996. The sudden decline this 
past summer in commodity prices for the major grains and oilseeds 
resulted in a substantial increase in the need for OGC assistance with 
respect to numerous issues related to marketing assistance loans and 
loan deficiency payments. Similarly, OGC attorneys have worked closely 
with officials of the Department, particularly with personnel of the 
Farm Service Agency (FSA), to implement the various disaster and 
marketing loss assistance provisions of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 1999. These new authorities involve more than $5.5 
billion in expenditures. Furthermore, OGC worked with FSA and other 
agencies in crafting a means of providing aid to hog producers who have 
suffered through disastrously low prices during this past year. This 
included developing a program to make $50 million in payments available 
to hog producers using authority provided for in section 32 of the Act 
of August 24, 1935, which had not been utilized since 1961.
    OGC continues to provide FSA with needed assistance in connection 
with conservation programs such as the Conservation Reserve Program, 
which is in the midst of another successful sign-up. Additionally, 
during this year, OGC helped FSA draft and finalize new Conservation 
Reserve Enhancement Program (CREP) agreements with the States of North 
Carolina, New York, Oregon, and Washington.
    The tobacco program and tobacco-related issues have continued to 
raise difficult legal issues. After a very successful series of 
criminal prosecutions involving a widespread problem with tobacco 
marketings that took place in 1990-1992, FSA, with OGC assistance, has 
now begun to initiate civil actions to collect monies from warehouses 
where over-quota tobacco may have been marketed. Also, OGC has provided 
needed advice on issues arising out of the various proposed ``national 
settlements'' for tobacco which have come before the agency. OGC 
attorneys are assisting the Department of Justice in responding to an 
appeal filed in the United States Court of Appeals for the Fourth 
Circuit by tobacco warehouse operators challenging administrative 
penalties imposed upon them.
    With respect to USDA's domestic food assistance programs, OGC has 
been heavily involved in efforts related to the implementation and 
enforcement of new legislation aimed at welfare reform and other 
program improvements, as well as the ongoing program integrity and 
compliance initiatives. We expect the demand for legal services in 
connection with these activities to remain constant in fiscal years 
1999 and 2000.
    More specifically, during this past year, OGC attorneys worked 
closely with the Food and Nutrition Service (FNS) to develop the 
Administration's proposals for and/or implement the provisions of: the 
Agricultural Research, Extension, and Education Reform Act of 1998 
(AREERA), Public Law 105-185; the William F. Goodling Child Nutrition 
Reauthorization Act of 1998 (Goodling Act), Public Law 105-336; the 
Balanced Budget Act of 1997, Public Law 105-33; and the Illegal 
Immigration Reform and Immigrant Responsibility Act of 1996, Division C 
of Public Law 104-208. In particular, OGC is providing assistance in 
connection with the implementation of the food stamp administrative 
payment reduction provisions of AREERA and the changes to the Child 
Nutrition programs brought about by the Goodling Act, such as new 
services for at-risk school children and others up to 19 years of age 
and revisions to eligibility and reimbursement provisions of the Child 
and Adult Care Food Program. Challenges have been raised by potential 
food stamp participants concerning the implementation by some States of 
certain welfare reform provisions initiated by the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996 
(PRWORA), Public Law 104-193. These issues concern State food stamp 
policies with respect to applicant awareness and access to the Food 
Stamp Program. It is expected that similar ``welfare-to-work'' issues 
may be raised as States continue to reform their welfare policies.
    The implementation of the alien provisions of the PRWORA continues 
to generate litigation in several States. OGC is representing USDA's 
interests in ongoing inter-agency discussions aimed at providing a 
uniform and predictable test for determining when the receipt of 
benefits renders an alien deportable, inadmissable or ineligible for 
adjustment of alien status as a result of being likely to become a 
public charge.
    In addition, OGC coordinated USDA's legal work in connection with 
the first suspension action taken against a dairy operation determined 
by State weights and measures inspectors to have provided under-filled 
(shortweighted) half pints of milk to schools participating in the 
National School Lunch Program. The 8 shortweighting results, in some 
cases, half pint cartons lacked as much as half an ounce of milk, 
prompted a closely orchestrated effort by State weights and measures 
officials, State procurement officials, USDA agency personnel and OGC 
attorneys to institute corrective and prospective action by the dairy 
operation.
    OGC continued to address numerous issues arising from the 
nationwide rollout of electronic benefit transfer (EBT) in the Food 
Stamp Program and demonstrations of the use of EBT in other food 
assistance programs. Electronic delivery of benefits has shown 
significant results in terms of reduced costs and improved program 
integrity, as well as other improvements. For these reasons, the use of 
EBT systems are a top priority of the Food Stamp Program.
    We have provided substantial support to the Department's food 
safety activities. Last year as you know, the HACCP rule was 
implemented in the nation's largest meat and poultry plants. In January 
of this year, HACCP became operational in over 2800 additional plants 
nationwide. We have worked very hard with the Food Safety and 
Inspection Service (FSIS) over the last year to ensure successful 
implementation of these pathogen reduction and HACCP system 
requirements. We provided daily support to FSIS not only for 
implementation of HACCP inspection procedures but also on an array of 
rulemaking initiatives to improve and streamline the food safety and 
inspection system regulations. These regulatory initiatives have 
included a proposal to permit the use of ionizing radiation to treat 
refrigerated and frozen uncooked meat food products to reduce levels of 
food-borne pathogens in these products; the finalization of rules that 
would eliminate highly prescriptive sanitation regulations and replace 
them with performance standards giving plants flexibility to innovate 
and better ensure good sanitation practices tailored to each 
establishment; and a proposed rule governing retained water in poultry 
that would eliminate unnecessary differences between meat and poultry 
processing requirements.
    We also provided legal support for enforcement actions under the 
meat and poultry inspection laws. We have handled an array of criminal, 
civil and administrative cases involving violations of those laws and 
as well as actions for the withdrawal and suspension of inspection 
services, or termination of the custom exemption, from meat and poultry 
establishments where compliance was lacking. OGC assisted the 
Department of Justice (DOJ) in appellate litigation which challenged 
the Department's application of meat and poultry inspection laws to 
retail stores that seek to distribute meat and poultry products to 
kiosks located in shopping malls. We are currently working with DOJ in 
a lawsuit filed in the U.S. District Court for the District of Columbia 
by the American Federation of Government Employees, the Community 
Nutrition Institute and eight FSIS food inspectors, challenging the 
validity of the Pathogen Reduction/HACCP regulations and FSIS' decision 
to test new inspection models that we believe will lead to more 
effective inspection and better use of scarce inspection resources.
    In the past year, OGC has provided extensive legal services to the 
Agricultural Marketing Service (AMS) in various matters and will 
continue to work closely with AMS on some of these matters as well as 
new issues that will arise in the year ahead. OGC continues to provide 
assistance in the reform and consolidation of federal dairy marketing 
orders. A proposed rule was issued on January 21, 1998, after extensive 
review and revision by our office. AMS is currently evaluating and 
considering thousands of comments submitted in response to the 
proposal. The Department is required by Congress to issue a final 
decision between February and April 1999, and to implement the final 
rule on October 1, 1999.
    The organic standards rulemaking will continue to be an OGC 
priority during the coming year. On December 16, 1997, a proposed rule 
was published that would establish a National Organic Program under the 
Organic Foods Production Act of 1990. The proposal generated over 
275,000 comments. These comments ranged from simple opposition to all 
or portions of the proposal to more complex and substantive comments, 
raising a variety of policy and legal issues concerning the proposal 
and issuance of a final rule. Currently, we are working with the 
organic program staff on drafting a revised proposed rule that will 
address concerns raised by the comments.
    The Commodity Promotion, Research, and Information Act of 1996 
provides general authority for the Secretary to issue orders 
establishing new research and promotion programs. Prior to enactment of 
this statute, research and promotion programs were authorized under 
individual statutory authorities. The 1996 Act provides authority to 
tailor a program according to the individual needs of an industry. On 
November 6, 1998, a proposed rule was published in the Federal Register 
that would provide for an industry funded promotion, research and 
information program for peanuts, and representatives of the olive oil, 
dry bean, seafood, asparagus, forestry products, macadamia nuts and 
sweet corn industries have expressed interest in establishing programs. 
We will continue to work with AMS as these new research and promotion 
programs develop.
    In 1998, the Supreme Court denied the motion for reconsideration in 
Glickman v. Wileman, thus ending the First Amendment constitutional 
challenge to the tree fruit advertising program. On the basis of the 
decision in Wileman, the United States Court of Appeals for the Ninth 
Circuit dismissed Cal-Almond v. United States Department of Agriculture 
and the Supreme Court subsequently declined to review that dismissal. 
The challenge to the almond advertising program, and the argument that 
it is significantly different that the tree fruit program since it 
allows credit for a handler's branded advertising, also has been 
rejected. The Supreme Court's rulings in Wileman and Cal-Almond raised 
several dormant legal matters. Almost $7,000,000 of assessments held in 
a trust fund were turned over to the tree fruit administrative 
committee. An audit was conducted and it was found that approximately 
$11,000 was still owed by various handlers. The Department is in the 
process of obtaining a judgment for the remainder and seeking 
collection. Motions will also be heard in early 1999 to collect the 
remaining unpaid assessments under the almond marketing order. The 
handlers are resisting collection with various technical arguments and 
a significant amount of the funds are held by the Saulsbury Almond 
bankruptcy trustee. Finally, there are on-going challenges to several 
other advertising and promotion programs which claim to be 
distinguishable from Wileman because these programs were created by 
free-standing legislation and not by marketing orders. So far the Tenth 
Circuit Court of Appeals and District Courts in California, Michigan, 
and Tennessee have rejected these challenges. Despite a complete lack 
of success by the handlers, it is expected that the challenges will 
drag-on as appeals are pursued.
    We work very closely with Animal and Plant Health Inspection 
Service (APHIS) in connection with its regulatory activities related to 
the development of regulations that will allow new commodities to enter 
U.S. markets while ensuring that America's agricultural resources are 
not impaired and that plant and animal health in the U.S. are not 
compromised. These regulations have included requirements for an array 
of commodities, ranging from fruits and vegetables, to animals and 
animal products. They include the importation of pork from Yucatan and 
Sonora, Mexico, importation of ruminants and ruminant products from 
South Africa, and the importation requirements for animal and animal 
products from the European Union.
    We dedicated significant resources to defending a lawsuit brought 
by several environmental groups for alleged violations of the National 
Environmental Policy Act in connection with APHIS regulations governing 
the importation of logs, lumber, and unmanufactured wood products. In 
the early phase of the lawsuit, the plaintiffs obtained an injunction 
that prevented APHIS from issuing permits for the importation of 
certain wood products until a supplemental environmental impact 
statement (SEIS) was prepared. Our attorneys assisted APHIS in 
preparing an exceptionally comprehensive SEIS and ensuring that it was 
responsive to the Court's order. The SEIS was issued by APHIS in May of 
1998. I am pleased to report that the district court accepted and 
approved the SEIS findings, dissolved the injunction, and dismissed the 
case.
    APHIS' work on the SEIS led to the identification of additional 
import issues involving wood and wood products that needed to be 
addressed because of their significant pest risk potential. Principal 
among these issues was the pest risk posed by solid wood packing 
material. We assisted in the preparation of an interim rule, 
promulgated on September 18, 1998, prohibiting solid wood packing 
materials (SWPM) from China, and with an advance notice of proposed 
rulemaking published in the Federal Register in January of 1999 dealing 
with SWPM from all countries.
    We also handled a variety of administrative and federal court cases 
on behalf of APHIS to enforce its regulations. These cases have 
included prosecutions for violations of the standards for accredited 
veterinarians, the illegal importation of fruits and vegetables through 
Canada, and violations of regulations governing the importation of Haas 
avocados from Mexico into the United States.
    We assisted APHIS with the development of a new international 
agreement permitting the construction of a sterile screwworm production 
facility in Panama that will help ensure the continued success of the 
screwworm eradication program.
    OGC continues to provide significant legal services to the Animal 
and Plant Health Inspection Service (APHIS). In 1995 and 1996 APHIS 
conducted a negotiated rulemaking involving the complete revision of 
the regulations governing the humane handling, care, treatment, and 
transportation of marine mammals held in captivity. OGC provided 
substantial legal services to APHIS throughout the negotiated 
rulemaking process, and recently, provided substantial drafting and 
review services to APHIS in preparation for the publication of the 
proposed rule. Because all of the stakeholders participated in the 
formulation of the proposed rule, we do not expect that this rulemaking 
will be as controversial as other animal welfare rulemakings. We do 
expect, however, that this rulemaking will require the need for 
continued legal services in fiscal year 1999.
    In 1995 APHIS also published a proposed rule to develop new 
regulations for marine mammals used in human-dolphin interactive 
programs. This program is popularly known as Swim-with-the-Dolphin or 
SWTD. The final rule became effective on October 5, 1998. OGC has 
provided substantial legal services to APHIS throughout this 
rulemaking. OGC continues to provide substantial legal assistance to 
APHIS because of subsequent concerns raised by the marine mammal public 
display industry regarding the scope of the final rule. APHIS will be 
publishing in the near future a notice seeking comment from the 
industry on all aspects of the rule. We anticipate that this process 
will be very contentious because of the number of interest groups 
involved, and we expect that APHIS will have to engage in further 
rulemaking, which will require the need for continued legal services.
    In the Trade Practices area, we are continuing to give assistance 
and counsel to the Secretary on issues of concentration in agriculture 
and the continuing response of the Department to recommendations of the 
Advisory Committee on Agricultural Concentration. We prosecuted the 
nation's largest packer administratively on allegations that the packer 
gave an undue or unreasonable preference to certain feedlots in the 
procurement of cattle. The Department's Judicial Officer dismissed the 
majority of the case, but found one provision of the procurement 
agreement to be in violation of the Packers and Stockyards Act and 
issued a cease and desist order. That decision is now before the U.S. 
Court of Appeals for the 8th Circuit for decision. We are working with 
agency personnel on a number of investigations into procurement, 
pricing and competition in areas of production where there are high 
levels of concentration. We are continuing to prosecute cases involving 
financial or payment violations and we provide legal services in a 
number of investigations and enforcement actions involving allegations 
of false or misleading statements or representations or commercial 
bribery in the marketing of agricultural products.
    OGC also provides legal services to agencies which manage some of 
America's largest lending portfolios. The ongoing implementation of the 
Centralized Processing Center (CSC) for Single Family Rural Housing 
loans continues to require substantial legal resources. OGC continues 
to be heavily involved in debt collection and foreclosure work with 
many cases going back to the emergency loan programs of the 1970's and 
1980's. Implementation of the Debt Collection Improvement Act of 1996 
and the flexibility gradually being made available under the Rural 
Community Advancement Program of the 1996 Act also requires substantial 
legal resources. OGC also is providing legal advice concerning the 
designation of five additional empowerment zones authorized by the 
Taxpayer Relief Act of 1997 and 20 additional rural enterprise 
communities authorized by the Agriculture, Rural Development, Food and 
Drug Administration and Related Agencies Appropriations Act of 1999.
    The Secretary is committed to regulatory reform. We continue to 
work with Department officials to implement the President's regulatory 
reform package. This is a significant undertaking as we work with 
agencies throughout USDA to reduce regulatory burdens, eliminate 
obsolete or unnecessary regulatory requirements, and streamline 
regulations, particularly in the areas of rural, farm and utility 
lending. This year we look for a substantial push in this area from the 
Rural Utilities Service (RUS), Farm Service Agency (FSA), Rural 
Business-Cooperative Service (RBS), and Rural Housing Service (RHS).
    OGC provided considerable assistance to RUS on a range of matters 
related to the changing electric and telecommunications industries. In 
particular, the introduction of competition in the electric industry 
has resulted in increased demand for legal services by RUS on a number 
of key electric program matters. For example, OGC has provided legal 
services in connection with the restructuring of borrowers' power 
supply arrangements through mergers, alliances, and other types of 
reorganizations and through the renegotiation of borrowers' power 
supply contracts. OGC has also dedicated substantial resources to the 
negotiation and drafting of new security arrangements for some large 
power supply borrowers. These arrangements, patterned after indentures 
used in the private sector, will provide borrowers with more 
flexibility in operating in the new competitive environment while 
facilitating access to private market financing.
    As a result of the Telecommunications Act of 1996, which introduced 
deregulation and competition to the telecommunications industry, the 
RUS telecommunications program is facing a wide range of issues and 
concerns requiring legal services. These include issues of loan 
purposes, loan security and borrower structure as well as the impact of 
FCC orders implementing the Telecommunications Act on RUS borrowers and 
program interests. RUS for the first time made distance learning and 
telemedicine (DLT) loans in addition to its DLT grants. Legal 
assistance is required both in the promulgation of new regulations 
implementing the DLT program and in developing the documents for these 
loans and grants. One should not underestimate the legal resources 
which will be required by the movement to deregulate in the rural 
electric and telecommunications area.
    In the natural resources area, we have been involved in a number of 
extremely significant undertakings concerning national forest 
management and natural resources conservation programs. We also 
assisted our clients, the Forest Service and the Natural Resources 
Conservation Service, daily in legally advancing their program goals.
    We have provided assistance nationally to the Natural Resources 
Conservation Service in implementing a number of conservation programs, 
including the Environmental Quality Improvement Program (EQIP), the 
Wildlife Habitat Incentive Program, the Wetlands Reserve Program (WRP), 
the Farmland Protection Program, the Conservation Farm Option and 
Emergency Watershed Protection Program. In addition, we have provided 
legal services in support of the Clean Water Action Plan, including the 
EPA/USDA Joint Strategy for Animal Feeding Operations and the Watershed 
Approach for Management of Federal Lands.
    Management of our National Forests is a subject of intense debate 
and litigation, with a great deal of legal work generated by the impact 
of new scientific information on ongoing Forest Service projects and 
commitments. Legal questions include interpretation of the nature of 
forest planning in light of the recent Supreme Court ruling (Ohio 
Forestry Association v. Sierra Club), the relationship of the 
Endangered Species Act to the forest planning process, and revisions 
and appeals of the second generation of forest plans. OGC provided 
assistance to the Department of Justice regarding the scope of the 
government's obligations under the Endangered Species Act. The U.S. 
Court of Appeals for the 5th Circuit held that federal agencies are 
required by the Act to implement programs to conserve endangered and 
threatened species and to consult with the Fish and Wildlife Service as 
to individual species.
    Further, we are defending against numerous timber sale claims 
arising from contract modifications and suspensions to protect the 
habitat of endangered species and assisting the Forest Service with new 
timber sale contracting authority commonly referred to as stewardship 
contracting. We also successfully defended challenges in several places 
in the West by local governments and individuals under the so called 
``County Supremacy'' movement disputing federal ownership or 
jurisdiction over public lands. We are currently involved in appeal of 
a district court decision involving a land claim of the Pueblo of 
Sandia to thousands of acres of the Cibolla National Forest north of 
Albuquerque, New Mexico.
    We have also devoted substantial resources to other legislative and 
regulatory initiatives, such as land exchanges, relicensing of hydro 
electric projects, grazing reform, reauthorization of the Endangered 
Species Act, the Safe Drinking Water Act and the Comprehensive 
Environmental Response, Compensation, and Liability Act (CERCLA). 
Litigation which raises a question regarding application of a statute 
of limitations to CERCLA natural resource damages claims by federal 
trustees is pending before the Court of Appeals for the 9th Circuit. 
OGC also provided the Forest Service with support in the administration 
of the National Forest lands as they are affected by the complex 
statutes related to mineral exploration.
    In addition, we regularly provide advice on compliance and 
litigation arising under the pollution control laws. Most frequently, 
pollution control issues involve abandoned and inactive mines and 
landfills on federal lands, the use and storage of agricultural 
chemicals, and management of hazardous waste at agricultural research 
facilities. We have worked with other federal resource management 
agencies on implementation of executive authority under CERCLA to 
address cleanup of hazardous substances affecting federal resources.
    As the Administration and the Congress continue their efforts to 
re-invent the Federal government, and as the Department takes its own 
initiatives to make its delivery of services more efficient, 
streamlined, and customer friendly, we anticipate greater demands on 
the General Law Division. These range from providing legal services 
regarding personnel and labor matters; increased legal services in 
relation to the Freedom of Information Act and the Privacy Act; debt 
collection initiatives; Year 2000 compliance; and legal support for 
creative approaches of doing more with less through mechanisms such as 
partnering.
    Among its many responsibilities, the General Law Division provides 
legal services to the National Appeals Division (NAD). Agency 
implementation of new administrative offset procedures pursuant to the 
Debt Collection Improvement Act of 1996 continue to resonate in 
numerous appeals to NAD, resulting in legal questions regarding the 
intersection of the offset process and the NAD appeal process.
    As NAD determinations begin to be challenged in the district and 
appellate courts, novel issues have begun to arise regarding exhaustion 
of administrative remedies, district versus claims court jurisdiction, 
implementation of NAD determinations, and discovery.
    With regard to the procurement of property and services, the 
Clinger-Cohen Act of 1996 set in motion many changes still in evolution 
regarding the acquisition, use, and disposal of information technology 
by the Federal Government. In particular, the General Law Division will 
continue to devote substantial resources to assist the Chief 
Information Officer created by the Act in fulfilling her duties both 
under the Act, and under separate Secretarial mandates, to improve 
information technology management in the Department.
    Also, with regard to procurement, since the 1996 revision of the 
General Accounting Office protest rules, which in effect requires 
agency legal representation, the General Law Division has provided an 
enhanced level of legal representation of USDA agencies in such 
matters.
    As its name implies, the Agricultural Research, Extension, and 
Education Reform Act of 1998 contained numerous provisions regarding 
priority-setting, public input, and greater accountability in research, 
education, and extension programs, both within the Department and among 
our land-grant partners. Those reform provisions with the greatest 
impact become effective on October 1, 1999. Considerable resources will 
be expended in fiscal year 1999 and fiscal year 2000 to ensure that 
this deadline is met and to ensure a smooth transition to the 
applicable requirements to research, extension, and education grant 
funds awarded in fiscal year 2000.
    Over the past few years the Department has taken measures to 
improve the operations of its agencies and improve how its agencies 
service their customers. In February 1999, USDA took another 
significant step in that direction by converging the administrative 
support functions of the Rural Development mission area, the Farm 
Service Agency, and the Natural Resources Conservation Service into a 
single entity, the Support Services Bureau (``SSB''). The General Law 
Division provided legal advice with respect to the formulation of the 
SSB. It is anticipated that as the SSB is implemented, significant 
attorney resources will be required to address numerous legal issues 
involving labor law, personnel law, administrative law, fiscal law, and 
leasing of office space.
    Besides the labor law issues that will be attendant to 
restructuring and downsizing, changes have occurred in the OGC itself 
that will require the attorney resources of the General Law Division in 
the coming year. Last year the American Federation of Government 
Employees was elected as the exclusive representative under the Federal 
Service Labor Management Relations Statute (``FSLMR'') of both 
professional and non-professional employees of OGC in field locations. 
During this process, General Law Division attorneys advised OGC 
managers regarding issues under the FSLMR. It is anticipated that 
General Law Division assistance will continue to be required in 
implementing management responsibilities under the FSLMR and 
negotiating collective bargaining agreements with the new units.
    We continue to provide legislative drafting and related assistance 
to the Department and Congress on major legislative activities that 
involve the Department. Extensive assistance was provided to Department 
policy officials and Congressional staffs in drafting and analyzing 
various legislative proposals recently considered by Congress, 
including proposals in connection with the Goodling; AREERA; the 
Agriculture, Rural Development, Food and Drug Administration, and 
Related Agencies Appropriations Act, 1999 (Pub. L. No. 105-277); and 
the Plant Protection Act (HR 3766). We are preparing legislation to 
improve the Department's conservation and trade assistance programs. In 
addition, we are participating in the preparation of legislation in a 
number of areas in support of the President's fiscal year 2000 budget 
request for the Department.
    Over the past two years the Department has engaged in massive 
efforts to reform its civil rights performance. The Secretary wants to 
ensure that all of our customers and employees are treated with dignity 
and respect and are afforded equal employment opportunity and equal 
access to all USDA programs. Critical to the achievement of these goals 
was the creation of the Civil Rights Division (CRD) within OGC, staffed 
with attorneys who have specialized expertise in civil rights law, and 
are charged with providing legal services to the Secretary and all 
agencies of the Department on civil rights legal issues.
    The CRD played a very critical role in the settlement of the 
Pigford and Brewington litigation. Both cases are class actions filed 
by African American farmers who have filed administrative complaints of 
discrimination with USDA since 1981 alleging race discrimination in 
Farm Service Agency programs. The consent decree received preliminary 
approval on January 5, 1999. A fairness hearing on the settlement was 
held on March 2, 1999. When the consent decree is given final approval 
by the court, it will provide a framework for the adjudication of 
claims of African American farmers who believe they suffered 
discrimination by the Department in connection with USDA credit and 
benefit programs during the period January 1, 1981 through December 31, 
1996. The settlement will help the Department open a more constructive 
front in its efforts to be the Federal civil rights leader in the 21st 
century.
    Key to settlement of the Pigford and Brewington cases was the 
enactment last year the waiver of various statutes of limitations, that 
allows farmers with long-standing discrimination complaints to have 
their claims finally heard. Section 741 of the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 1999, enacted in section 101(a), Division A, of the 
Omnibus Consolidated and Emergency Supplemental Appropriations Act, 
1999, Pub. L. No. 105-277. The Associate General Counsel for Civil 
Rights and the Assistant General Counsel for Legislation worked with 
Departmental officials, members and staffs of the House and Senate, DOJ 
officials, and White House officials to bring about enactment of the 
statute of limitations waiver language in the budget bill. CRD also 
worked some with GLD and the Associate General Counsel for Legislation, 
Litigation, and General Law in drafting regulations to implement the 
new law. 63 Fed. Reg. 67392 et seq. (Dec. 4, 1998) (codified at 7 
C.F.R. Part 15f). The success of this work shows the potential when the 
different divisions work in cooperation. cooperation.
    Settlement of the Pigford and Brewington and any case in which a 
farmer alleges discrimination can only include damages if the claim 
alleges credit discrimination and the Department or the courts find 
that discrimination occurred in our credit programs. The limitation on 
the Department's ability to award damages in conducted discrimination 
cases was made clear by the 1994 Opinion of the Office of Legal Counsel 
(OLC), Department of Justice entitled Authority of USDA to Award 
Monetary Relief For Discrimination. In its opinion, OLC ruled that, in 
cases of alleged discrimination in a USDA conducted program, such as 
FSA farm loan programs, the Secretary has authority to award monetary 
relief, attorneys' fees, and costs if a court could award such relief 
in an action by the aggrieved person. However, after examining Title VI 
of the Civil Rights Act of 1964, the Fair Housing Act, the 
Rehabilitation Act, and the Equal Credit Opportunity Act (ECOA), OLC 
concluded that only ECOA waives sovereign immunity with respect to 
monetary relief, authorizing imposition of compensatory damages by the 
Department. In light of this opinion, OGC issued memoranda to the 
Office of Civil Rights that made clear that CR can settle farmer 
discrimination case for monetary damages only if the case involves 
credit discrimination and only to the extent a court could award 
damages given the facts of the case.
    With respect to the Pigford and Brewington settlement, CRD will 
take the leading role to ensure that USDA meets its commitments under 
the consent decree, particularly with respect to the production of 
relevant documents and necessary legal analysis related to each claim 
filed pursuant to the consent decree. CRD is working with the FSA, the 
Office of Civil Rights (CR), and the DOJ to develop rapid responses to 
claims and to help ensure that the Government's responses are timely 
and appropriate.
    With respect to farmer discrimination claims not covered by the 
Pigford and Brewington settlement, CRD will work with CR to ensure that 
all claims, including those filed pursuant to the statute of 
limitations waiver, receive expeditious and fair consideration, within 
the bounds set by applicable law.
    The number of employment discrimination cases filed against the 
Department has increased dramatically. CRD and OGC field offices are 
defending the Department in administrative litigation before the Equal 
Employment Opportunity Commission (EEOC) and are working with DOJ to 
ensure the best possible defense in court.
    In Donnelly v. Glickman, C-95-4389 DLJ, a class action filed in 
Federal district court on behalf of female employees of the Region 5 
(California) of the Forest Service, a negotiated settlement is near. In 
a related matter, the Government is negotiating with the Forest Service 
Region 5 Regional Hispanic Working Group to negotiate settlement of 
issues similar to those raised in Donnelly before litigation is filed. 
In both negotiations, CRD attorneys are working with the OGC Regional 
Attorney, DOJ, and Departmental officials in Washington, chiefly in 
developing settlement proposals for the negotiations and participating 
in the negotiations. CRD is performing the Department's goals of 
addressing legitimate concerns of the plaintiffs and addressing 
systemic issues that will hopefully prevent future litigation.
    Similarly, in Herron v. Glickman, EEOC No. 100-98-7120X, a class 
action pending before EEOC in Washington, filed on behalf of African 
American employees of FSA, alleging that African American employees at 
the GS 12, 13, and 14 levels were being prevented from obtaining 
promotions to the GS 13, 14, and 15 levels respectively, CRD has 
completed several months of discovery and is now discussing litigation 
and settlement options with the FSA Administrator and the Under 
Secretary.
    To address other employment issues, CRD will intensify its efforts 
to provide training and technical assistance to OGC field attorneys and 
to Department officials, civil rights directors, and employee relations 
specialists. The goal is to identify and address issues before they 
become litigation. Where issues are identified, CRD will bring the 
issues to the attention of appropriate Department officials, with legal 
analysis and recommendations for addressing the issues.
    Drafting and reviewing nondiscrimination regulations is part of 
CRD's mission. In 1998, CRD drafted a proposed published regulation 
governing nondiscrimination in programs and activities conducted by 
USDA which will delete 7 C.F.R. Part 15, Subpart B, which deals with 
programs and activities receiving Federal financial assistance from 
USDA--and create a new 7 C.F.R. Part 15d that will deal exclusively 
with conducted programs. CRD is in the process of finalizing the 
regulation for publication. The new 7 C.F.R. Part 15d would clarify 
that the regulation applies to all USDA conducted programs and 
activities; add familial status, marital status and sexual orientation 
to the protected classes contained in the regulation; add a provision 
concerning USDA agencies' compliance efforts; add public assistance 
status as a prohibited basis under authority in the Equal Credit 
Opportunity Act (ECOA); add a prohibition against reprisal; and reflect 
Secretary's Memorandum 1010-4 (May 16, 1997), which further delegated 
to the CR Director the authority to make final determinations on 
complaints and order corrective actions. The regulation has been 
published, the comment period has ended and the final regulation will 
be published soon.
    In 1998, CRD worked with CR on a number of nondiscrimination 
Departmental Regulations (DRs) to further the effort to reform the 
Department's civil rights enforcement program: DR 1614, Processing EEO 
Complaints of Discrimination; DR 4330-2, Nondiscrimination in USDA 
Conducted Programs and Activities; and DR 4330-1, Nondiscrimination in 
Programs and Activities Receiving Federal Financial Assistance from 
USDA. The Departmental regulations are near completion.
    CRD is assisting more and more agencies in developing proposed 
regulations that would require recipients of Federal financial 
assistance to collect certain participation data on ``protected 
classes,'' such as race, color, religion, national origin, sex, age, 
and disability. This work is critical to ensuring compliance with Title 
VI of the Civil Rights Act of 1964 and other statutes that prohibit 
recipients of Federal financial assistance from discriminating with 
respect to the programs for which they are receiving Federal financial 
assistance.
    CRD drafted a Secretary's Memoranda and Secretary's Decision 
Memorandum creating a uniform policy on adverse actions against 
individuals who have filed complaints of discrimination against USDA. 
These documents are near completion and will begin the clearance 
process shortly.
    CRD will continue to write memoranda giving advice and legal 
opinions on a number of civil rights topics. A current project relates 
to the Department's authority to provide compensatory damages in 
discrimination cases arising in Federally conducted programs.
    CRD's most important work is in assisting agencies and 
administrators in complying with the letter and spirit of civil rights 
laws, thereby avoiding unnecessary litigation, in providing training 
and ongoing advice and other legal service. Training, however, is just 
one component. The development of ongoing working and collaborative 
relationships between CRD and agency officials is critical and will be 
a great part of CRD's work this year.
                    fiscal year 2000 budget request
    For fiscal year 2000, OGC is requesting $32,675,000 in direct 
appropriations. This request represents a significant increase of 
$3,481,000 over the fiscal year 1999 appropriation. The requested 
increase is needed to support and maintain current staffing levels to 
meet the current and projected increased demand in delivering pre-
decisional legal advice, training, appeal and litigation legal services 
to agencies. The majority of the increase consists of $1,159,000 for 
pay costs, which OGC does not have any flexibility for absorbing and 
$1,621,000 to maintain current staff and provide enhanced legal 
services in specific areas where staffing is insufficient to adequately 
meet demands for legal services generated by the Department. The 
remaining $701,000 is necessary for the office to meet processing 
requirements into the year 2000 and beyond. OGC anticipates migrating 
fully to Windows 98, replacing and or upgrading 15 file servers along 
with 50 percent of the personal computers. The requirement to upgrade 
the hardware will be a continuing process as the technology continues 
to change.
                                closing
    That concludes my statement, Mr. Chairman. We very much appreciate 
the support this Subcommittee has given us in the past. Thank you.
                                 ______
                                 
                      Office of Inspector General
       Prepared Statement of Roger C. Viadero, Inspector General
                       introduction and overview
    Good afternoon, Mr. Chairman and members of the Committee. I am 
pleased to have this opportunity to visit with you today to discuss the 
activities of the Office of Inspector General (OIG) and to provide you 
with information on our audits and investigations of some of the major 
programs and operations of the U.S. Department of Agriculture (USDA).
    Before I begin, I would like to introduce the members of my staff 
who are here with me today: Jim Ebbitt, Assistant Inspector General for 
Audit; Greg Seybold, Assistant Inspector General for Investigations; 
and Del Thornsbury, Director of our Resources Management Division. I 
want to thank the Committee for its support during the nearly 4\1/2\ 
years since my appointment as Inspector General. We have tried to work 
closely with you, and I hope that we have been able to address some of 
your concerns.
    OIG's mission is to perform audits and investigations of the 
Department's more than 300 programs and operations, recommend policies 
and actions to promote economy and efficiency, and prevent and detect 
fraud, waste, and mismanagement in these programs and operations. We 
keep you and the Secretary informed about problems and deficiencies and 
report criminal violations to the U.S. Attorney General. We have a 
diverse staff of auditors, criminal investigators, and other personnel 
in offices throughout the Nation to carry out these activities.
    I am proud to say that in fiscal year 1998, we continued to more 
than pay our own way. In the audit arena, we issued 220 audit reports 
and obtained management's agreement on 1,122 recommendations. Our 
audits resulted in questioned costs of over $112 million. Also, as a 
result of our audit work, management agreed to recover more than $39 
million and put another $128 million to better use. Most importantly, 
implementation of our recommendations by USDA managers will result in 
more effective operations of USDA programs. Additionally, our 
investigative staff completed 815 investigations and obtained 777 
indictments, 604 convictions, and 2,780 arrests. Investigations also 
resulted in $81 million in fines, restitutions, other recoveries, and 
penalties during the year.
    We continued to work closely with agency officials during fiscal 
year 1998 to address key issues and to expand our cooperation with 
other Federal, State, and local law enforcement and audit agencies to 
broaden the impact of our work. Working together, our staffs identified 
program weaknesses and program violators. Capitalizing on the staffs' 
respective expertise, we created solutions for positive action.
    In fiscal year 1999, we are focusing our efforts primarily on food 
safety and smuggling of uninspected, unapproved food products carrying 
unwanted pests and diseases into the United States that affect the 
wholesomeness of the Nation's food supply. We are also focusing our 
audit efforts on the Department's financial accounting systems; farm 
credit programs; the Rural Rental Housing Program; the Food Stamp 
Program, including its Electronic Benefits Transfer efforts; and the 
Child and Adult Care Food Program. In addition to investigations and 
emergency responses to threats to the health and safety of food, our 
investigative priorities include investigations of sponsors abusing the 
child and adult care programs; employee integrity issues; and fraud in 
the Department's loan, regulatory, and benefit programs. Before I 
discuss some of our specific audit and investigative activities, I 
would like to update the Committee on the status of our forfeiture 
authority.
    I am pleased to report to you that on the forfeiture front, with 
this Committee's strong support, we are now authorized to receive 
proceeds from forfeiture actions arising from our investigations. Our 
memorandum of understanding was signed with the Department of Justice 
in May of last year and, since that time, we have been a fully 
participating agency in the Justice Department's Asset Forfeiture Fund.
Special Health and Safety Initiative
    Mr. Chairman, at this time, I would like to discuss our special law 
enforcement request for fiscal year 2000. This effort will be a major 
endeavor for the agency, and we ask your support to provide the 
resources necessary for it.
    The quality or wholesomeness of the Nation's food supply, from 
production to the consumer, is of special concern to OIG. 
Investigations of any criminal activity that poses a threat to the 
general health and safety of the public remain our highest priority. 
Criminal investigations have usually involved the processing and sale 
of adulterated meat or poultry and egg products; criminal tampering 
with food products consumed by the public; and product substitution, 
adulteration, or other misrepresentation of food products which are 
regulated or purchased by USDA.
    Recent and ongoing investigations involving real or alleged threats 
to food products intended for the public have necessitated the 
immediate deployment of OIG special agents and auditors to several U.S. 
cities. These cases have involved real or threatened adulteration or 
contamination of meat with everything from E. coli bacteria or Listeria 
to HIV-infected human blood. Some of these products were destined for 
or actually ended up in the National School Lunch Program or on 
military bases.
    To address these types of emergencies, we are entering into joint 
activities with other Federal and State agencies to share intelligence 
and conduct undercover operations. Doing so will help us stem the 
threat to the food supply from packing plants and other facilities and 
target criminal enterprise in general.
    The increasing threat to the wholesomeness of domestic and exported 
food requires not only vigilance but also advanced preparedness 
including preemptive operations. Profit-motivated criminal activity 
that threatens the food industry can cause economic disruption while 
victimizing innocent members of the industry. Likewise, threats of 
criminal adulteration and biological contamination of food products 
from outside the food industry for extortion or ideological motives can 
victimize and disrupt the Nation's food production and distribution 
systems. These threats must be resolved through a vigilant, established 
emergency law enforcement and health and safety response.
    A threat in a Milwaukee, Wisconsin, meat plant is a prime example 
of these types of dangers. This past December, the plant received a 
threat of biological contamination using HIV-infected human blood. We 
immediately deployed 30 OIG special agents (including eight bilingual 
agents to converse with Spanish-speaking plant employees) and four 
auditors to the scene to determine the validity of the threat and to 
identify those responsible. Personnel from the Food Safety and 
Inspection Service (FSIS) assisted in this investigation, with FSIS 
staff taking the lead role in ensuring that potential contaminants had 
not been introduced into the food chain. Our investigative efforts to 
resolve this bioterrorism threat continue. Approximately 580 interviews 
have been conducted to date. I am pleased to be able to report that 
extensive testing of samples taken from the plant has not indicated the 
presence of human HIV-infected blood.
    In another significant case, an OIG Emergency Response Team was 
dispatched to a Nebraska meat plant to investigate an outbreak of E. 
coli bacteria when 15 people in Colorado became ill after eating ground 
beef patties that came from the plant. Two plant officials have been 
indicted and await trial for misleading FSIS and OIG during our 
attempts to determine the source of the E. coli bacteria. Some 25 
million pounds of ground beef were recalled due to this contamination, 
which, at that time, was the largest meat recall ever in the Nation.
    Additionally, we are currently investigating a significant case 
involving another meat company alleged to have intentionally 
adulterated and misbranded beef and pork products, which have also 
tested positive for E. coli bacteria. Approximately 4.4 million pounds 
of this company's meat product containing ground pork or ground beef 
are under voluntary hold at various school districts, prisons, military 
institutions, and other facilities. In addition, another 1.6 million 
pounds of this product are being retained or detained at other 
facilities.
    We have also investigated other cases in which the health and 
safety of the public were at serious risk. In Buffalo, New York, three 
feed company employees pled guilty to Federal charges and await 
sentencing for their role in selling canned meat products to the public 
which were unfit for human consumption. This product was being shipped 
from a Canadian company to the feed company to be used as animal food 
but was diverted by these individuals to be sold for human consumption. 
In a second case in New York, an FSIS inspector pled guilty in Federal 
court and was sentenced to 6 months in prison for accepting bribes from 
the owner of a slaughter facility to permit the slaughter of livestock, 
including 3-D (dead, diseased, or dying) cows, without the benefit of 
inspection. In Pennsylvania, the owner of a slaughterhouse pled guilty 
to conspiracy, while three employees pled guilty to violating the 
Federal Meat Inspection Act. These individuals were caught slaughtering 
3-D cows after the FSIS inspector had left the premises and then 
commingling the unwholesome product with meat that had been inspected.
    We have initiated audits of the new food safety procedures for 
inspecting meat and poultry plants, the Hazard Analysis Critical 
Control Point system, or HACCP. Since an increasing number of 
processing plants are becoming subject to HACCP, the safety and 
wholesomeness of the Nation's meat and poultry supply are dependent on 
HACCP being successfully implemented. Meanwhile, our efforts to 
actively address the problems of food safety, posed by those who put it 
at jeopardy and who are motivated by profit or ideology, present 
special concerns for us. OIG needs to be prepared to immediately 
respond to these emergency situations. To do so, we must be equipped 
with the specialized equipment, protective clothing, and supplies 
necessary to ensure the health and safety of our personnel responding 
to these crises.
    We also need to be mindful of the economic impact of closing a 
major food processing plant. To our knowledge, the Milwaukee plant I 
mentioned earlier had violated no laws and had been successfully 
implementing HACCP inspection procedures. Yet, its production line was 
successfully halted by outside forces, tons of its product were put on 
hold, and the facility was temporarily shutdown. OIG's rapid response 
and deployment of considerable staff resources not only helped to 
protect the health and safety of consumers, but it also allowed the 
plant to reopen--reemploying approximately 1,500 people with a minimum 
disruption of production, lost profit, and impact on the local economy 
as opposed to an indefinite and costly closure.
    The costs of rapid responses by OIG such as this are great. In 
addition to the personnel time and the disruption to other critical OIG 
work, to date, we have expended approximately $40,000 in unanticipated 
travel costs in the Wisconsin investigation alone. This figure will 
continue to rise until the matter is resolved.
    Another form of criminal enterprise that poses a significant threat 
to the Nation's food supply and its economic well-being is smuggling of 
uninspected, unapproved food products into the United States. A direct 
result, and a byproduct of smuggling, is the danger that forms of 
pestilence--whether insects, fungi, bacteria, or viruses--not 
previously present in the United States could be introduced here. As a 
result, entire crops of the U.S. agricultural industry--such as citrus, 
vegetables, trees and other plants, or beef, poultry, and pork 
products--could be severely damaged, devastating the economy of the 
local communities producing these products as well as reducing both the 
quantity and quality of the Nation's food supply.
    The Administration has begun a new initiative to counteract the 
invasion of unwanted and mostly foreign species of plants and animals. 
By Executive Order, the President has established an Invasive Species 
Council, which the Secretary of Agriculture will Co-chair, to ensure a 
safe and wholesome food supply and prevent the spread of unwanted, 
invasive pests.
    OIG has begun an antismuggling campaign to interdict and suppress 
foreign contraband that is dangerous when consumed by the American 
population, and potentially catastrophic to the economic stability of 
certain U.S. agricultural products. Ongoing criminal investigations are 
targeting smuggled fruits, vegetables, plants, and other commodities or 
animals that bring high dollars in underground ``black market'' 
commerce. This initiative requires significant agent resources 
dedicated to intelligence collection, undercover operations, and 
foreign law enforcement cooperative efforts that cross international 
boundaries. These activities normally require extensive surveillance 
utilizing high-tech investigative devices and equipment.
    The smuggling of infested fruits into the United States is a 
serious law enforcement problem because the criminal profit is 
tremendous while the deterrent is grossly inadequate at present. 
Longans are a good example. Longans are prized Asian fruits. They cost 
$1 a pound from distributors in Taiwan and are sold illegally in U.S. 
markets at $7 to $10 per pound. Often they are contaminated with fruit 
flies. Although banned in the United States, sealed containerized 
shipments of longans are routinely, and legally, allowed into U.S. 
ports for transshipment to Canada. Intelligence efforts have documented 
that semi-trucks, which can carry 40,000 pounds or more of 
containerized longans, have transported shipments into Canada, where 
the fruit is not prohibited, only to turn around and smuggle the 
shipments back into the United States, thus, allowing for pest 
infestations in this country.
    One well-known example of a devastating pest that has been 
introduced into this country is the Mediterranean fruit fly, commonly 
called Medfly. One of the world's most destructive agricultural pests, 
it attacks more than 250 kinds of fruits, nuts, and vegetables, causing 
major economic losses. Whole States can be beset with severe crop 
losses and economic problems caused by this and other such pests. In 
the past 4 years, Florida has been faced with severe outbreaks of 
oriental fruit fly, citrus leaf miner, brown citrus aphid, citrus 
canker, African beetle, leather leaf anthracnose, pine short beetle, 
and sweet potato fly in addition to the Medfly infestations. Animal 
pests and disease importation are a severe problem in Florida and, due 
to the favorable climate in most of the southeastern United States, the 
pests and diseases could easily spread throughout that area. The costs 
to protect the industry are staggering. Since 1980, over $256 million 
in California State and Federal funds has been spent to eradicate 
Medfly infestations in quarantined areas. In the last 10 years, Florida 
has spent more than $150 million to eradicate such infestations.
    The risk to the agricultural industry, including exports, is clear. 
The State of California alone produces over $25 billion in fruits, 
nuts, and vegetables annually--about 55 percent of the Nation's output. 
About $11.8 billion of these commodities is exported to other countries 
each year.
    In carrying out successful smuggling investigations, OIG must 
perform extensive travel; procure and maintain the necessary 
specialized equipment needed to investigate these incidents; provide 
essential protective supplies and/or equipment to ensure the health and 
safety of our agents and auditors; and provide specialized training to 
our staff to prepare them to cover various types of such emergencies. 
OIG must also provide state-of-the-art Y2K compliant ADP equipment and 
systems to track data; analyze intelligence-based information; and 
provide faster, more responsive information to better support this 
mission work. All of these items are essential to ensure that OIG can 
adequately address this critical public health and safety issue 
concerning the quality and wholesomeness of the Nation's food supply.
    Mr. Chairman, at this time, I would like to highlight some of our 
other audit and investigative activities.
                  audit and investigations activities
                   marketing and regulatory programs
           animal and plant health inspection service (aphis)
    We have investigated various types of criminal acts involving APHIS 
programs. An investigation in San Francisco, California, provides a 
good example. In this case, two businessmen pled guilty to causing the 
delivery of misbranded food for introduction into interstate commerce 
in this case. A joint investigation conducted by OIG, the U.S. Customs 
Service, and the U.S. Food and Drug Administration disclosed that the 
businessmen smuggled bird nests, abalone, fish maw, scallops, and dried 
oysters from Hong Kong by commingling these products with their 
legitimate imports of frozen shark fins and other food products. The 
two businessmen received 3 years' probation and were each ordered to 
pay a $3,000 fine and restitution of $1,500. A third individual is 
pending trial on similar charges.
    In Oregon, six individuals are awaiting sentencing after they pled 
guilty on Federal charges of theft for their part in a conspiracy to 
fraudulently acquire and sell over 100 dogs to medical research 
facilities. The six defendants have also agreed to testify against a 
former USDA-licensed dog dealer, her husband, and their son, who have 
all been indicted for conspiracy and mail fraud related to the scheme. 
Our investigation disclosed that the dealer and her associates either 
stole dogs or obtained them under false pretenses over a 15-month 
period. The dealer then falsified APHIS forms in order to conceal her 
activities. She also forwarded false documents to the Oregon State 
Department of Agriculture.
                  agricultural marketing service (ams)
Oversight of the Fluid Milk Promotion Program Needs Strengthening
    Our review of the Fluid Milk Promotion Program indicated that AMS 
and the National Fluid Milk Promotion Board need to improve their 
oversight and controls over the program's activities to ensure that 
assessments on fluid milk are used in accordance with the Fluid Milk 
Promotion Act. Those assessments, from approximately 370 processors, 
totaled about $169 million from December 1993 through June 1997.
    Neither AMS nor the Board provided adequate management or oversight 
of program activities. AMS left most oversight efforts to the Board. 
The Board delegated most administrative functions to two contractors 
and was not actively involved in the day-to-day operations of the 
program. One contractor, the Milk Industry Foundation, was responsible 
for performing various management and administrative services. The 
other contractor, the Board's Administrator, was responsible for 
collecting assessments, accounting for funds, and performing compliance 
reviews. These services were provided through contracts with the 
Administrator's public accounting firm. Altogether, the Board's 
Administrator, either as an individual or through his firm, had three 
sole-source contracts with the Board.
    Although AMS was responsible for reviewing and approving all 
contracts, the Board paid over $127 million for contracts, representing 
75 percent of the funds collected through the program, without AMS' 
approval. The Board entered into these sole-source contracts without 
any competition to ensure the most cost-effective procurement of 
services.
    The Act requires that the Board obtain title to all assets 
developed using program funds. In one case, the contract to procure 
photographs, taken as part of a major milk-marketing campaign, the 
popular ``Milk Mustache'' or ``Got Milk'' advertising campaign, did not 
include language to secure title to the photographs. Consequently, the 
program expended almost $130,000 in royalties for the continued use of 
the photographs. The photographer still has control and possession of 
the photographs, which were developed using over $2.7 million in 
program funds.
    Overall, neither AMS nor the Board has determined, as required by 
the Act, whether the program has resulted in increased milk 
consumption. While this marketing campaign has been highly visible in 
the marketplace, no independent studies have been performed to 
determine the campaign's impact on fluid milk consumption.
    We recommended that AMS: (1) suspend Board program activities until 
a plan is developed whereby the Board will take full control of its 
activities and comply with the Act, including establishing guidelines 
for awarding contracts to ensure that contracted goods and services are 
obtained in the most cost-effective manner; (2) require the Board to 
determine the effectiveness of its research and promotion activities to 
increase fluid milk consumption; (3) require the Board to obtain AMS 
approval on all contracts before any funds are obligated or expended 
and that the Board obtain title and possession of all assets acquired 
with program funds; and (4) require the Board to assure that audits of 
its books and records are conducted using generally accepted Government 
auditing standards. AMS did not agree to suspend the Board's 
activities. However, it has agreed to institute improvements and is 
continuing to work with the Fluid Milk Board to strengthen management 
controls.
                 food, nutrition, and consumer services
                    food and nutrition service (fns)
Operation Talon
    In previous testimony, I informed you we had initiated ``Operation 
Talon.'' This special law enforcement initiative, made possible by the 
passage of Welfare Reform, involves the exchange of information between 
law enforcement and State social services agencies. Specifically, law 
enforcement fugitive records are matched with social service agencies' 
food stamp recipient records, and the information is used by law 
enforcement officers to locate and apprehend dangerous and violent 
fugitive felons who may also be illegally receiving food stamp 
benefits.
    Overall, Operation Talon has been the most successful investigative 
initiative we have yet undertaken. To date, this initiative has 
resulted in the arrest of over 3,650 fugitive felons. This has included 
26 wanted for murder or attempted murder; 11 for rape or attempted 
rape; 8 for kidnapping; and 1,202 for assault, robbery, or drug 
offenses. This has also resulted in the arrest of 18 fugitive felons 
wanted for child molestation. A number of States are removing arrested 
fugitives from their food stamp rolls, which will result in savings to 
the Food Stamp Program and allow food stamp benefits to continue to go 
to the needy for whom they were intended. One particularly rewarding 
note is that 2 of the 18 fugitives wanted for child molestation have 
also been charged with violating State ``Megan's Law'' statutes. In one 
of these cases, OIG and the Hudson County, New Jersey, Sheriff's 
Department arrested a convicted child molester for failing to register 
as a sex offender. The fugitive had moved without notifying appropriate 
State officials and eluded the authorities until he provided his new 
address to participate in the Food Stamp Program.
    One recent Operation Talon success was in Austin, Texas, where our 
special agents worked with Texas law enforcement officials in 
apprehending over 75 fugitive felons. We have additional warrants and 
anticipate the arrest of numerous other fugitive felons in this highly 
successful operation. Operation Talon is an ongoing initiative, and, 
working with local law enforcement agencies, we are planning future 
arrest operations in many parts of the country.
Food Stamp Program (FSP)--Coupon Trafficking
    We are continuing to devote significant investigative resources to 
combat fraud in the Food Stamp Program. Ever since the program began 
distributing food stamps to needy Americans, unscrupulous people have 
been willing to devise methods to unlawfully benefit from this 
important program. There are basically two types of traffickers--the 
street traffickers who buy or barter food stamps or EBT card benefits 
for cash or other nonfood items, and the retailers who purchase or 
redeem unlawfully obtained food stamps or cards from eligible 
recipients.
    We have conducted several significant food stamp trafficking cases 
in the last year. Investigations conducted of large-scale fraud 
operations in New York, Philadelphia, and Detroit are good examples of 
these. In these investigations, we have thus far identified 55 store 
owners and employees involved in the unlawful acquisition of some $99 
million in food stamp benefits. This has resulted in the arrest and 
conviction of many of these individuals, some of whom have been 
sentenced to prison terms and ordered to pay millions of dollars in 
restitution. Our investigations into these matters continue, and we 
anticipate additional persons will be charged.
Child and Adult Care Food Program (CACFP)
    Last year, I testified about a special law enforcement initiative 
we had undertaken with one of the targeted programs being CACFP. I 
indicated that we would continue ``sweeps'' of program sponsors to find 
those who are abusing the program to remove them from sponsorship, to 
prosecute them if warranted, and to recover ineligible payments. Since 
last year, our CACFP initiative has been designated as a Presidential 
Initiative which we named Operation ``Kiddie Care.''
    Our efforts have been very successful. Currently, we have 29 open 
CACFP investigations. As of December 1998, 54 sponsors in 23 States 
were being audited or investigated. We identified 37 sponsors as being 
seriously deficient, a term used by FNS to designate sponsors who could 
be terminated from the program unless the deficiencies are addressed 
promptly. Fourteen sponsors, who had been receiving a total of $24.4 
million annually, have been terminated from the program.
    In Ohio, seven persons, including the director of the sponsoring 
organization operating a local child and adult care food program, pled 
guilty to conspiracy to submit false claims for issuing or receiving 
reimbursement payments for in-home day care providers who did not exist 
or did not have children in the home. This ongoing investigation has 
identified 11 people to date who conspired to set up more than 40 false 
providers. This conspiracy, which had been ongoing since 1988, resulted 
in the submission of false claims for reimbursements totaling about 
$1.1 million. The investigation continues with additional prosecutions 
anticipated.
    In another California case, an executive director of a sponsor 
retained food reimbursements to cover the salary he claimed to earn in 
California while he was actually working for another enterprise and 
living in Wisconsin. He also had a vehicle in Wisconsin for his 
personal use which was being paid for by the California sponsor. We are 
currently investigating about $231,000 of program funds paid to this 
individual.
    We will continue with Operation ``Kiddie Care'' as long as we find 
evidence that abuses exist. Returning integrity to this important 
feeding program and protecting the resources of the American taxpayer 
are high priorities for OIG and FNS.
Special Supplemental Food Program for Women, Infants, and Children 
        (WIC)
    One of the primary purposes of the WIC program is to provide funds 
to pregnant women and families with small children to allow them to 
purchase certain nutritious food items. In an effort to curb fraud in 
the WIC program, we are continuing our investigative activities in this 
area. One such investigation occurred in conjunction with the Columbus, 
Ohio, Division of Police; the Ohio Department of Taxation; and the 
Franklin County prosecutor where we conducted a 12-month undercover 
investigation into trafficking of WIC infant formula and untaxed 
cigarettes. Investigators determined that store owners and a wholesaler 
received the formula through the black market, removed its ``not for 
retail sale'' marking, and sold it commercially in area stores and to 
businesses in other States. In two separate ``buy-bust'' cases, store 
owners and managers were arrested for illegally purchasing hundreds of 
cases of WIC formula and hundreds of thousands of cartons of untaxed 
cigarettes. Both investigations were linked to a Columbus commodity 
wholesaler at whose warehouses between $500,000 and $1 million in 
commodities were seized. The owner and the manager of the first ``buy-
bust'' case pled guilty to racketeering and trafficking in WIC benefits 
and untaxed cigarettes. The owner and manager in the second case pled 
guilty to trafficking in WIC benefits and untaxed cigarettes. Their 
corporation pled guilty to racketeering, and the wholesaler is now a 
fugitive.
                 farm and foreign agricultural services
                       farm service agency (fsa)
OIG and FSA Managers Meet
    In a joint effort to further agency cooperation, OIG and FSA senior 
managers and other policy makers met at a roundtable conference in San 
Antonio, Texas, the week of December 7, 1998, to explore and embrace 
new ways of working together. Prior negative experiences brought many 
participants to the conference with an ``us versus them'' attitude. In 
the roundtable, OIG auditors, special agents, and FSA program officials 
were able to explain obstacles they frequently encountered in 
accomplishing their agencies' missions. Working together as part of a 
united team, the participants identified several opportunities to 
improve communications, and all participants left with a new 
appreciation for the other's needs. We look forward to improved working 
relationships with FSA's Administrator and his hardworking staff.
Noninsured Crop Disaster Assistance Program (NAP) Overpayments
    We reviewed 1996 crop-year program payments in California, Florida, 
Georgia, and Oklahoma, where $26.9 million in benefits--out of a total 
of $45.9 million nationwide--were paid as of July 31, 1997. We found 
hidden or inaccurate reporting of production and the use of incorrect 
yields to compute payments for 23 of the 98 cases. We found that 
because the estimates and adjustments used to determine loss could not 
be verified, the process for determining the actual amount of loss 
allowed producers to obtain unwarranted program benefits. This was a 
major problem for seeded wheat forage in Oklahoma. For other crops--
strawberries, cherries, and onions--production was based on information 
reported by the producer which also was not verifiable as actual 
production. We recommended that FSA collect $411,000 in overpayments. 
FSA has agreed to review the payments and collect any overpayments to 
which relief provisions did not apply.
Overpayment of Emergency Assistance to Producers in the Upper Great 
        Plains
    In January 1997, FSA implemented two programs to provide assistance 
to endangered livestock caught in the blizzards and cold weather in 
North and South Dakota. The Emergency Feed Grain Donation Program 
(EFGDP) provided 100-percent cost-share assistance to livestock 
producers for snow removal and to feed their livestock in immediate 
danger of perishing. The Foundation Livestock Relief Program (FLRP) 
provided 30-percent cost-share assistance for area producers to enhance 
the diet of foundation livestock--or breeding stock--weakened by the 
severe winter weather.
    Because the two programs ran concurrently with different cost-share 
rates, some producers improperly received assistance for supplemental 
feed purchases under EFGDP instead of FLRP. This allowed the producers 
to receive 100 percent of the feed cost compared to the 30-percent 
cost-share. In addition, we found that producers were paid excessive 
snow removal costs during a 15-day extension period and for snow 
removal when they already had access to normal feed supplies. FSA 
improperly authorized $2.5 million of FLRP payments to 23 counties in 
Iowa, Montana, Nebraska, and Wyoming adjoining the disaster area. We 
recommended FSA strengthen its oversight role in certain areas to help 
ensure that future disaster assistance is limited to identified areas 
and require county offices to act on the cases where excessive EFGDP 
and FLRP payments were issued. FSA believes its existing controls are 
generally adequate; but, due to the complexity and difficulty of 
administering emergency and disaster programs, procedures to improve 
oversight will be incorporated into future programs. FSA agreed, 
subject to the finality rule, to recover the overpayments.
Environmental Benefits Index Scores Controls Could Be Improved
    Under the Conservation Reserve Program (CRP) producers receive 
annual payments from FSA to take highly erodible cropland out of 
production and establish and maintain a vegetative cover on it. During 
signup, producers designate tracts of land determined to be 
environmentally sensitive, which are reviewed and scored according to 
values on the Environmental Benefits Index (EBI). One subpart of the 
index identifies the environmental benefits of the land, such as 
providing cover beneficial to wildlife. It also specifies what 
numerical scores may be given for the different kinds of conservation 
practices--planting mixed grasses, legumes, etc.--that the producer 
established to enhance each benefit. Tracts that have been awarded 
higher scores are regarded as more worthy of conserving and qualify for 
CRP consideration ahead of tracts with lower scores. Tracts that fall 
below a minimum score are excluded from the program.
    We reported that the Natural Resources Conservation Service's 
(NRCS) implementation of CRP exhibited significant control weaknesses. 
These included improperly modified point scores for various 
environmental ranking factors and subfactors in some States. In 
addition, producers in some States received high scores for preserving 
cover beneficial to wildlife or for protecting threatened and 
endangered species even though the required cover or endangered species 
were not present on the tract of land. Such inconsistencies can result 
in greater CRP consideration for cropland in one State, even though its 
environmental benefits are no greater than those of its neighbors. We 
identified approximately 2,900 offers nationwide with annual rental 
payments totaling about $13 million that were at risk of incorrect 
acceptance into CRP. NRCS management issued guidance that addressed 
some scoring problems noted in our review.
                farm service agency (fsa) investigations
    Historically, one of our primary activities has been the 
investigation of criminal violations of the various farm loan programs 
administered by USDA. We continue to conduct such investigations with 
great success. A good example is a honey producer in Idaho. This 
individual was sentenced to serve 28 months in prison and ordered to 
pay USDA over $3 million in restitution after he pled guilty to 
submitting false statements to FSA in order to obtain over $6 million 
in loans and subsidy payments.
                           rural development
                      rural housing service (rhs)
OIG and RHS Join Forces to Combat Fraud and Abuse in Rural Rental 
        Housing (RRH) Program
    OIG and RHS combined efforts to identify, investigate, and 
prosecute owners and management agents that had abused or defrauded the 
RRH program. We targeted owners and management agents who were 
suspected of abusing the program.
    Joint OIG-RHS teams physically inspected 631 apartment complexes 
and then examined the financial records of apartment complexes operated 
by 32 owners and management agents in 13 States. The teams identified 
over $3.5 million in misused funds and uncovered serious physical 
deterioration of some apartment complexes, including conditions that 
posed health and safety risks to the tenants. Our work is continuing, 
and we will issue a summary report later this spring.
    An investigation in Washington State centered on a prominent local 
attorney who was a general partner of multiple limited partnerships 
which owned federally financed and subsidized low-income housing 
projects. The attorney had built 65 apartment projects in 20 States 
under the RRH program. Our investigation disclosed that the partner 
submitted false and fictitious construction invoices to RHS and to the 
lending banks which administered RHS loans in order to divert $176,000 
in funds from four RHS loans. Our investigation also showed that he 
received kickbacks from the bank where loan funds were deposited. In 
order to conceal the kickbacks, he submitted fictitious invoices to the 
bank for purported legal services rendered. He also failed to disclose 
$95,000 in income derived from the diverted funds and other sources on 
his 1995 individual income tax return. He pled guilty to making false 
statements, receiving unlawful payments, and filing a false Federal 
income tax return. He was sentenced to 21 months in prison and ordered 
to pay $300,000 in restitution.
Problems Exist With Electric Program Loan Funds, Borrowers
    We evaluated the Rural Utilities Service's (RUS) electric program 
because of its high dollar value--approximately $32 billion, potential 
for large losses--writeoffs of more than $1.7 billion and about $8 
billion owed by troubled borrowers, and recent changes in legislation 
and in the industry. We found that the eligibility criteria prescribed 
by law and regulation for hardship loans and prioritization of 
applications for municipal rate loans did not take into consideration 
the applicant's financial strength, loan amounts, or local user rates. 
Also, the Rural Electrification Act of 1936, as amended, and 
regulations did not allow RUS to ensure that guaranteed loans benefited 
only truly rural areas. This could delay funding for improvement of 
electrical services to the most needy borrowers and in truly rural 
areas.
    We recommended that RUS seek legislative change and amend 
regulations so that hardship loan funds can be targeted to areas of 
greatest need by taking into consideration financial condition and 
local area user rates and by ensuring municipal rate loan funds benefit 
only truly rural areas. Although agency officials generally agreed with 
our findings, they did not agree with our recommendations to seek a 
legislative or regulatory change.
                               insurance
                      risk management agency (rma)
Reinsurance Companies' Quality Control Systems Lacking
    RMA delivers multiple-peril crop insurance programs through 
standard reinsurance agreements with private insurance companies. Under 
the agreements, the companies are required to develop quality control 
plans consistent with the agency's policies and procedures that 
safeguard against waste, loss, unauthorized use, and misappropriation. 
This past year, we reviewed the quality control processes of reinsured 
companies operating under agreements made with RMA in 1995. We found 
that, although the quality control systems generally complied with the 
terms of the agreement, they did not effectively improve program 
delivery, ensure program integrity, and adequately measure or report on 
program performance. The consequences of poorly specified requirements 
in the reinsurance agreements were insufficient data collection, 
maintenance, and reporting requirements; ineffective oversight of 
quality control operations; and insufficient controls against conflicts 
of interest. As a result, program officials cannot rely on reinsured 
companies' quality control reviews.
    We recommended that RMA, in consultation with crop insurance 
organizations and experts, adopt appropriate professional standards for 
quality control and, in particular, controls to deal with conflicting 
sales and claims adjustment operations that affect the integrity of 
crop insurance programs. The agency concurred with our recommendations 
for improved quality control processes but not with our findings and 
recommendations for improved controls against potential conflicts of 
interest. We are working with RMA on the disputed recommendations.
Nonirrigated Crop Insurance Yields Set Too High and Practices Not 
        Viable
    Prompted by an OIG hotline complaint, we audited RMA's first year, 
crop-year 1998, extra long staple (ELS) cotton insurance program in the 
Texas counties of Glasscock, Midland, Reagan, and Upton. We determined 
that the transitional-yields, or T-yields, and established yields based 
on historical averages for nonirrigated ELS cotton were set 
exceptionally high. Also, we questioned whether the growing season and 
rainfall were sufficient to produce ELS cotton in these four counties. 
We reported that, as a result of these issues, RMA could incur 
excessive losses of about $12 million for the 1998 crop-year alone. 
Similarly, we disclosed that high T-yields for nonirrigated popcorn in 
the Rio Grande Valley resulted in indemnities totaling about $5.5 
million for 1997, and nonirrigated dent corn T-yields for 1998 were 
sufficiently elevated to result in losses of between $2.2 million and 
$2.8 million in Tom Green County, Texas.
    Officials in the four counties stated that these were not locally 
accepted practices because more water is required than the counties 
receive in rainfall and the growing season is too short for ELS cotton 
to properly mature. Therefore, we concluded that nonirrigated practices 
were not viable in the cited counties and recommended that, effective 
for crop-year 1999, RMA discontinue coverage for ELS cotton in the four 
counties named in the complaint, popcorn in the Rio Grande Valley, and 
dent corn in Tom Green County. RMA agreed.
                   research, education, and economics
 cooperative state research, education, and extension service (csrees)
Schedule A Extension Appointees' Rights Need Clarification
    There are approximately 8,000 Schedule A appointees working 
nationwide in the State Cooperative Extension System (CES). The 
appointees receive Federal benefits including participation in the 
Federal Health Benefits Program and civil service retirement plan. In 
1990, the Civil Service Due Process Amendments extended coverage to 
these appointees. Our review of adverse actions taken against two 
appointees by one State university CES director disclosed that the 
universities are not always aware that protections such as counseling 
and appeals procedures apply. In this case, the university had offered 
no protections and stated that its own policy allowed the CES to 
dismiss the appointees without recourse. The Office of General Counsel 
provided CSREES with an opinion that these positions fall within the 
due process requirements of the Merit Protection System. USDA's Office 
of Human Resources Management confirmed that Schedule A appointees are 
Federal employees for purposes of civil service protections.
    On December 9, 1998, the Merit System Protection Board ruled that 
the individual taking actions against the two employees was within 
Federal jurisdiction. The case was remanded to an Administrative Judge 
for further adjudication. OIG has encouraged CSREES to work with the 
National Association of State Universities and Land Grant Colleges to 
inform all CES offices of the appointees' current status and assist 
them in developing suitable personnel procedures for these positions.
           accounting, financial, and information management
Financial Statement Audits
    As required by the Chief Financial Officers Act of 1990 and the 
Government Management Reform Act, we completed seven financial 
statement audits of the Department's programs. We issued unqualified, 
or ``clean,'' opinions on the fiscal year 1997 financial statements of 
the Federal Crop Insurance Corporation, the Commodity Credit 
Corporation, and the Rural Telephone Bank. Audits of the Rural 
Development mission area and the Food and Nutrition Service resulted in 
qualified opinions. Rural Development received a qualified opinion 
because we were unable to assess the reasonableness of its estimated 
loan subsidy costs for loans obligated after fiscal year 1991.
    In fiscal year 1997, FNS received a qualified opinion because we 
were unable to assess the reasonableness of its gross, non-Federal 
accounts receivable for the Food Stamp Program and the related account 
balances and notes to the financial statements. I am happy to report 
that on February 1, 1999, we issued an unqualified opinion for the 
fiscal year 1998 financial statements for FNS.
    For fiscal year 1997, we issued a disclaimer of opinion on the 
Forest Service (FS) and the USDA consolidated statements. FS received a 
disclaimer due to significant financial system weaknesses which include 
the lack of an integrated general ledger and supporting subsidiary 
records. The USDA consolidated statements received a disclaimer of 
opinion for fiscal year 1997 because the Department could not provide 
assurance that its financial systems provide information that is 
relevant, timely, consistently reported, and in conformance with 
applicable accounting principles. In addition to financial system 
problems, numerous internal control weaknesses exist that materially 
impact the Department's ability to report accurate and reliable 
financial information.
    A disclaimer of opinion has been issued to the Department for each 
of the last 4 years. This means that the Department, as a whole, does 
not know whether it correctly reported the amount of revenue it 
received, the cost of its operations, or other meaningful measures of 
financial performance. The Department and its agencies have recognized 
the weaknesses and have put considerable effort into improving their 
financial systems and reporting processes. While plans have been made 
to fix these problems and actions have been taken to address some of 
the weaknesses, more must be done. The Department is carrying out its 
Financial Information System Vision and Strategy project aimed at 
developing a single integrated financial management system that meets 
all Treasury and Office of Management and Budget requirements and 
fulfills the needs of USDA. We continue to assist departmental and 
agency officials in these efforts.
Information Resources Management
Department Progressing With ``Year 2000'' Conversion
    The Year 2000 issue has the potential to limit the Department's 
ability to deliver its programs. In April 1997, we began a continuing 
review and assessment of the Department's Year 2000 conversion efforts. 
Most recently, we completed a review of the renovation and validation 
efforts of seven agencies. This review determined whether the agencies 
had devised a strategy to convert, replace, or eliminate impacted 
hardware and software; fully tested and certified systems identified as 
compliant; and adequately assessed data exchanges and communicated with 
the exchange partners. Overall, we determined that the agencies are 
progressing in their Year 2000 conversion efforts; however, improvement 
is needed in some areas.
    Our review disclosed that FSA had reported four mission critical 
systems--the Highly Erodible Land and Wetland Conservation system, the 
Cotton Rate Offer system, the Daily Terminal Prices System, and the 
Marketing Assessment System--as Y2K compliant without performing any 
validation testing. Also, FSA reported that its Warehouse Rates 
Management System and the Processed Commodities Inventory System would 
not be implemented until June 1999. The Foreign Agricultural Service 
reported that its Financial Accounting and Reporting system will be 
implemented in April 1999. The Animal and Plant Health Inspection 
Service reported its Information System Upgrade Project would not be 
implemented until September 1999. In addition, FS reported its data 
exchange agreements generally consisted of informal verbal agreements 
which did not fully establish the data conversion responsibilities of 
each exchange partner.
    Due to the time sensitivity of the Year 2000 issue, these findings 
and others have been provided to the affected agencies in interim 
reports. The agencies have responded to our recommendations, and an 
audit report consolidating our findings will be issued later this year. 
Currently, we are reviewing personal property, facilities, and 
equipment because of their reliance on embedded microprocessor chips.
                           employee integrity
    The investigation of serious misconduct by USDA employees remains a 
high priority of OIG. During fiscal year 1998, OIG issued 55 reports of 
investigation concerning serious allegations of misconduct by USDA 
employees. Our investigations resulted in 23 convictions of current and 
former employees and 80 personnel actions, including reprimands, 
suspensions, resignations, removals, and alternative discipline.
    In July 1994, a tropical storm struck southern Georgia, causing 
serious flooding and millions of dollars in damage. As a result, NRCS 
negotiated and funded numerous watershed repair contracts under the 
Emergency Watershed Protection Program (EWPP). After we received 
confidential information from a private sector contractor, our 18-month 
investigation developed evidence showing that two NRCS employees, who 
were responsible for managing EWPP contracts, accepted cash bribes from 
a contractor in exchange for special considerations in obtaining EWPP 
contracts. A third employee arranged for a contractor doing business 
with NRCS to perform construction work on personally owned land. The 
cost of this work was then improperly billed to USDA. During July 
through September 1998, the three employees entered guilty pleas in 
U.S. District Court to violations resulting from their acceptance of 
bribes and gratuities. One employee was fined and placed on probation 
while the other two employees are awaiting sentencing. All three 
employees resigned from NRCS.
    A Louisiana Rural Development county office employee pled guilty in 
Federal court to embezzling and misapplying over $82,000 in rural 
housing loan payments she had received in her office. She was sentenced 
to serve 6 months' imprisonment, to be followed by 4 months' home 
confinement. She was also fined $10,000 and ordered to pay nearly 
$24,350 in restitution. The employee resigned soon after we initiated 
our investigation.
                               conclusion
    This concludes my statement, Mr. Chairman. As you can see, the work 
of OIG is far-reaching and expansive. I appreciate the opportunity to 
appear today and present this information, and I hope that my comments 
have been helpful to you and the Committee. I will be pleased to 
respond to any questions you may have at this time.
                                 ______
                                 

  Office of the Under Secretary for Research, Education, and Economics

      Prepared Statement of Dr. I. Miley Gonzalez, Under Secretary
    Mr. Chairman, Members of the Committee, I am pleased to appear 
before you to discuss the fiscal year 2000 budgets for the Research, 
Education, and Economics (REE) mission area agencies. I am accompanied 
by Deputy Under Secretary, Dr. Eileen Kennedy, and the Administrators 
of the four mission area agencies: Dr. Floyd Horn, Administrator of the 
Agricultural Research Service (ARS); Dr. Colien Hefferan, Acting 
Administrator of the Cooperative State Research, Education, and 
Extension Service (CSREES); Dr. Susan Offutt, Administrator of the 
Economic Research Service (ERS); and Mr. Donald Bay, Administrator of 
the National Agricultural Statistics Service (NASS). Each Administrator 
has submitted written testimony for the record.
    The REE budget, the first budget submitted since the passage of the 
Agricultural Research, Extension and Education Reform Act of 1998 
(Reform Act), reflects very strong support for the REE programs and a 
recognition of contributions that research, education, economics and 
statistics programs of REE can make in solving the pressing challenges 
facing agriculture and the nation. REE and its agencies have a proud 
history of finding solutions to the challenges facing agriculture over 
many decades. Building on the extraordinary possibilities of cutting 
edge research and biotechnology, REE is more capable than ever of 
delivering on new challenges in production agriculture, food safety and 
nutrition, mindful of the need to find environmentally sound solutions. 
The budget we are discussing today, begins to meet the spirit of the 
message delivered by the House Committee on Science last fall in its 
report Unlocking Our Future. To quote the report, ``Science . . . must 
be given the opportunity to thrive, as it is the precursor to new and 
better understanding, products and processes.'' I believe this budget 
affords the Nation's agriculture and food system and all who have an 
interest in its future, the opportunity to benefit from such a thriving 
research and education system. As good as our REE programs are today, 
the size and shape of the increased investment found in this budget is 
one in which all would benefit, producers from Maine to Guam and 
consumers from Alaska to Puerto Rico.
    Overall, the President's budget provides $2.1 billion for the four 
REE agencies, an increase in program level of 7 percent above fiscal 
year 1999 for the conduct of research, education, and statistical 
programs. This is the most significant increase in the REE budgets 
since the early 1990's and moves REE in the direction of the funding 
increases in the budgets of other major research agencies across the 
government over the last few years. Meaningful increases are requested 
for all four agencies to support high priority initiatives and programs 
addressing critical issues, such as food safety, human nutrition, 
emerging diseases, pest management, and environmental quality.
    The 7 percent increase in the overall program level of funding 
depends significantly on the inclusion of the Initiative for Future 
Agriculture and Food Systems under Section 401 of the Reform Act. The 
program provides an infusion of $120 million in the CSREES budget to 
competitively award research, education, and extension grants focused 
on high priority issues outlined in the Reform Act, such as farm 
efficiency and profitability and natural resource management. In 
addition, $20 to $40 million will be available for research, extension, 
and education through the Fund for Rural America when allocation 
decisions are made after the 2000 Appropriations Act is enacted.
    The overall increase in the REE budget reflects the strong support 
that REE is receiving from the Secretary and the Administration. We 
have worked diligently with the Secretary to explain the benefits of 
the research investment and make the results and benefits more broadly 
known to our stakeholders and the general public. However, I am still 
concerned that we find ways to balance the research portfolio in 
helping colleges and universities enhance their future capacity with 
base funding, so they may strengthen their ability to compete in the 
new Initiative for Future Agriculture and Food Systems that encourages 
this competitiveness. We want to work with you in this arena. Minority 
serving institutions find themselves even more disadvantaged in this 
growing competitive environment.
    As we take some satisfaction in the increase in this budget and the 
implied recognition of its value and productiveness, I believe we must 
acknowledge that new times demand new ways of doing business. I have 
talked with our university partners, and they share this recognition of 
this need for change as we move into the 21st century. Multi-
disciplinary, regional, multi-state, and multi-institutional strategies 
facilitate both efficient and effective returns on our research, 
education, and extension dollars. We must continue to listen to our 
stakeholders and customers and hear their needs. We must shape and 
describe our programs so, with a good dose of our judgment, the 
programs are responsive to those same stakeholders and customers. We 
must tell them in plain English just what we plan to do and what 
difference it will make for farmers, ranchers, food processors, and 
others in the food industry, as well as consumers. In other words, we 
must hold ourselves accountable for the investment made in our programs 
and understand that agricultural research and education issues 
transcend national borders and global competitiveness requires 
international scientific partnerships. We believe we are meeting the 
outreach, accountability, and coordination requirements of recent 
legislation efficiently and effectively. We are confident our efforts 
along these lines will contribute to program effectiveness, and better 
equip us, and you, to defend budget requests in increasingly 
competitive arenas.
    Often agriculture research and extension hold the keys to 
effectively addressing acute problems. Our recent response to the wheat 
and barley scab crisis in the northern Plains is an example of how 
quick action can make a difference. Similarly, our rapid and effective 
response to the Avian influenza scare proved to be very valuable in 
protecting the lives and health of all people.
    I believe it is equally important to call on and support the 
research and education system in government, at universities and at 
other research institutions in mounting a proactive, long term approach 
to solving or even avoiding acute problems, such as the ones being 
experienced by the farm community today. In this regard, I believe the 
REE education, extension and information technology programs can play a 
critical role. In our knowledge-based society, getting the right 
information in an accessible form to the user is the key to empowering 
farmers, individuals, families, and communities to improve their 
futures and guard against bad times. If I may quote again from the 
report Unlocking Our Future, ``Not only must we ensure that we continue 
to produce world-class scientists and engineers, we must also provide 
every citizen with an adequate grounding in science and math, if we are 
to give them an opportunity to succeed in the technology-based world of 
tomorrow.'' The results of our research and analyses yield information 
farmers need to effectively manage the many types of risk inherent in 
operating a farm, including crop selection, disease, weather, market 
volatility, and pest control. We have an obligation to ensure that this 
information gets to the farmers and other producers so they can make 
informed decisions. They need this to have a complete safety net. I 
urge you, in your deliberations on the REE budgets, to take full 
advantage of the potential value of such a long term approach for the 
new roles and responsibilities of scientific investigation and 
education in agriculture. We must make substantial funding for these 
areas the highest priority if we are to prepare for the future.
                    ree fiscal year 2000 initiatives
    Before turning to the budgets of the four REE agencies, I would 
like to focus on six high priority initiatives found in the budget: 
Integrated Pest Management, including implementation of the Food 
Quality Protection Act (FQPA); Food Safety; Agricultural Genomics; 
Small Farms; Global Change; and Community Food Security. They all 
represent critical investments to meet major challenges facing 
agriculture and the nation.
    Effective pest management is a continuing challenge for 
agricultural producers. The public's increasing concern about the 
quality of the environment and the safety of our food, reflected in 
such laws as the FQPA, heighten the challenge. While generally sharing 
the overall goals, producers find themselves needing new pest control 
technology that is effective and economically viable, and at the same 
time responsive to public environmental and food safety concerns.
    Under the umbrella of FQPA Implementation and Integrated Pest 
Management, the REE agency budgets include $29 million in increases 
focused on providing EPA information and data essential for science-
based implementation of FQPA and on advancing efforts to develop and 
transfer to producers environmentally sound and effective pest 
management technology. In fiscal year 1998, the Department established 
the Office of Pest Management Policy, to coordinate the FQPA/IPM 
activities. That office is effectively serving in that capacity. In 
particular, it is working closely with EPA to ensure that that agency 
has the data it needs, when it needs it to make decisions critical to 
producers on the availability of different pesticides under FQPA.
    Under the broader integrated pest management component of this 
ongoing initiative, significant progress has been made in developing 
sound pest management technologies and their adoption by producers. 
However, there is considerable distance to go in the pursuit of 
promising technologies and in the adoption of practices and 
technologies that take advantage of the newest discoveries coming out 
of IPM research. The initiative includes increases to support enhanced 
research on biocontrol alternatives to pesticides and new control 
technologies, as well as to support more effective transfer of the new 
technologies to producers. Both the ARS and the CSREES budgets include 
funding requests to expand work with producers to test new technologies 
and practices and facilitate their adoption. These increases to promote 
adoption of technologies are critical if the Nation is to benefit from 
the discoveries coming out of laboratories.
    Promoting food safety is a second issue in which the Administration 
and Department have a keen interest, an interest that fiscal year 1999 
Appropriations and the Reform Act indicate is shared by Congress. While 
the U. S. food supply is one of the safest, if not the safest, in the 
world, millions of Americans become ill each year due to food-borne 
pathogens. Consumers increasingly express concern about the safety of 
all food. Episodes of food contamination and the consumer response at 
the grocery store demonstrate the influence of consumer confidence on 
the demand for foods.
    Over the past few years, the Administration has taken major strides 
to improve our current food safety system. A ``farm to table'' approach 
to food safety has been adopted in which the potential for the 
introduction, transmission, prevention and/or elimination of 
contaminants is systematically examined at each step along the path to 
the consumer's table. Ongoing implementation of Hazard Analysis and 
Critical Control Point (HACCP), relying heavily on USDA research, is 
radically changing our meat and poultry inspection system and already 
showing signs of significantly reducing food contamination levels. Last 
year, the Administration placed new emphasis on food safety in fruits 
and vegetables, now an integral part of the Administration's Food 
Safety Initiative begun in fiscal year 1997. Producers are increasingly 
being called on to modify their production practices to reduce the 
potential for pathogen contaminations. In recognition of these new 
challenges, the food safety program is also placing new emphasis on 
research to help producers respond to preharvest food safety issues, 
such as animal waste management.
    The REE component of the Food Safety Initiative in the fiscal year 
2000 budget provides increases to ARS, CSREES, and ERS, totaling $26 
million, including increased funding through the National Research 
Initiative (NRI). Additional funds will be provided under the increase 
for the Initiative for Future Agriculture and Food Systems. The 
majority of the funds will focus on developing improved pathogen 
prevention and detection methods and other bioscience research in ARS 
and CSREES. ERS requests funds to determine the economic burden from 
unsafe food and to assess the benefits and costs of alternative 
pathogen control policies. CSREES would also receive funding to expand 
education efforts for those involved in the food production system from 
farm to table.
    To enhance the effectiveness of the national food safety research 
effort and the larger Food Safety Initiative, USDA, in collaboration 
with the Department of Health and Human Services, is providing 
leadership in establishing a new Joint Institute for Food Safety 
Research. Created in response to a Presidential directive, the new 
virtual Institute will promote coordinated planning and priority 
setting of food safety research across the government and with the 
private sector, using existing funds. The Institute will also 
facilitate transfer of research results into new food safety practices.
    A third initiative I would like to highlight is agricultural 
genomics. The promise of biotechnology for producers is well 
established. Higher yields, improved quality, greater resistance to 
disease and pests, and reduced stress due to adverse weather conditions 
are outcomes we can anticipate will help producers individually, and as 
an industry, to be more competitive in the global market. These same 
outcomes will help the Nation achieve a safe, abundant, and nutritious 
food supply and meet the needs of a growing population worldwide. 
However, such success depends on having an understanding of the genetic 
make-up of plants and animals on which biotechnology depends.
    As a leader in the President's Food Genome Initiative, a 
government-wide initiative, USDA is making a major contribution to the 
larger effort, expanding our knowledge of genomes of species of 
importance to the food and agricultural sector. The REE mission area 
has chaired the Interagency Working Group on Plant Genomics involving 
the Office of Science and Technology Policy, the Department of Health 
and Human Services, the Department of Energy and the National Science 
Foundation. In this role, REE continues to engage commodity group 
representatives and leading scientists in discussions about the plant 
genome research program.
    Joint ARS and CSREES programming under the USDA Agriculture Genome 
Initiative includes research on animals and microbes, as well as 
plants. This research program is built on the blueprint for future 
research outlined in a USDA concept paper and follows the Interagency 
Working Groups's Plant Genome recommendations.
    This research, focused on gene structure and function, is expected 
to have considerable payoff for crop species ranging from rice to corn 
and animal species ranging from cattle to swine to poultry. Efforts in 
the USDA food genomics program will initially concentrate on 
identification of economically important traits that increase yield, 
quality and disease resistance in plants, minimize the need for 
pesticides, and protect the environment.
    The budget provides ARS and CSREES increased support for genomics 
research. The CSREES funds would be provided under the NRI and the new 
Initiative. The Reform Act indicates both agricultural genome and 
agricultural biotechnology are high priority areas for the purposes of 
making grants.
    The small farms initiative is the fourth initiative I would like to 
highlight. Small farmers and ranchers make a valuable contribution to 
agriculture and rural America, often filling market niches and bringing 
life to rural communities. But many have fallen on hard times with the 
industrialization of agriculture and are struggling to find a place in 
an increasingly competitive sector. In 1997 Secretary Glickman 
established the National Commission on Small Farms to determine the 
status of small farms in the United States and recommend USDA actions 
to promote their economic viability and, therefore, their contribution 
to the agriculture sector and rural America in these new times. This 
initiative is responsive to the Commission's report, A Time to Act, in 
providing ERS and CSREES funds to better understand the market 
information needs of small farmers and the degree to which these needs 
are being met and to develop programs that help small farmers acquire 
the critical business skills and develop effective marketing strategies 
that promote economically viable farms. Increased funding in the NRI 
will support examination of the economics of small farms and their 
contribution to local economies, as well as increased funding of 
research appropriate to this segment of the sector. Data on small and 
medium-sized farms coming from the Census of Agriculture recently 
completed by NASS will be valuable in helping ARS and other agencies 
identify and conduct research responsive to the needs and priorities of 
such farms.
    Climate change is a fifth initiative I would like to highlight. 
Climate change has extraordinary implications for production 
agriculture in terms of the impact of climate change on plants and 
animals, as well as the potential for new production practices to 
mitigate these effects on agriculture and on the Nation. In support of 
the President's Initiative on Global Climate Change, the fiscal year 
2000 budget includes funds in the ARS, CSREES, and ERS budgets to 
support research to gain a better understanding of climate change, its 
causes and associated consequences for agriculture. The funds will also 
support complementary research on possible coping or adjustment 
mechanisms to minimize the adverse effect of climate change on 
agricultural production. Looking to the potential for agriculture to 
play a positive role in mitigating the greenhouse effect and associated 
global warming, other increases would provide new understanding of the 
greenhouse gas emissions and the potential for carbon sequestration 
carried out under production agriculture to mitigate such emissions. It 
is a promising possibility for agriculture that warrants serious 
investigation.
    The final initiative to be highlighted is Community Food Security. 
Communities across the Nation have been confronting an increasing 
number of food-related problems including unprecedented demand on the 
charitable food sector, the decline of local agriculture systems, and 
poor nutrition. To address these and related problems, the CSREES 
budget includes $15 million for a Food Recovery and Gleaning grant 
program as the principal component of the USDA Community Food Security 
Initiative. The purpose of the grant program is to improve methods of 
collection, transport and storage of recovered and gleaned food, to 
enhance the technical assistance and education network to empower 
communities to establish and administer food recovery programs and to 
extend understanding of the technical issues in food recovery.
    These are the highlights of six initiatives that span the agencies 
within REE. Fuller discussion of agency components of these initiatives 
can be found in the agencies' Explanatory Notes.
                  ree agency fiscal year 2000 budgets
    I would like to turn briefly to the budgets of the four REE 
agencies. The Agricultural Research Service (ARS) fiscal year 2000 
budget requests $837 million in ongoing research and information 
programs or a net increase of $51 million over fiscal year 1999. The 
proposed increases will be dedicated to a broad range of the high 
priority programs, such as food safety, human nutrition, invasive 
species and integrated pest management. To partially offset these 
increases the budget also includes redirection of approximately $35 
million in current programs to fund higher priority program initiatives 
of nationwide interest. As the principal intramural biological and 
physical science research agency in the Department, ARS continues to 
play a critical role for the Department and the larger agricultural 
community in conducting mission-driven research. Results from ARS's 
fundamental research provide the foundation of applied and 
developmental research carried out in many public and private 
institutions. Building on its own and other fundamental research, ARS 
also conducts applied research and technology development to solve 
specific problems of national and regional importance and to meet the 
research needs of other USDA agencies.
    The ARS fiscal year 2000 budget includes an increase of $20 million 
in the third year of the Human Nutrition Research Initiative. Research 
results continue to confirm the critical role of nutritious diets in 
promoting good health and mitigating diet-related disease. It is hard 
to overestimate the potential payoff for individuals and society as a 
whole from the adoption of healthy diets. At the scientific level and 
the personal level, increasing our understanding of the relationship 
between diet and health and of the sources of important nutrients will 
enhance our well-being and reduce our national health care bill.
    The fiscal year 2000 increases will emphasize the role of nutrition 
in bone growth and nutrient requirements for healthy mental function. 
Also included in the budget are funds to complete the Western Human 
Nutrition Research Center and the first of two phases of the new 
Beltsville Human Nutrition Research Center.
    In addition to the ARS increases in the highlighted initiatives and 
nutrition, the ARSbudget includes increases for emerging infectious 
diseases and invasive species, global change and sustainable 
ecosystems.
    The fiscal year 2000 budget proposes $45 million for the ARS 
building and facilities program, a decrease of $12 million from fiscal 
year 1999. As the Subcommittee knows, over the last 18 months the 
Strategic Planning Task Force on Research Facilities, mandated in the 
1996 Farm Bill, has been addressing the multifaceted and complex issues 
related to agricultural research facilities and their adequacy to 
support cutting edge research in the 21st Century. We are awaiting the 
Task Force's recommendations and guidelines in their report to be 
completed later this year. In the meantime, we believe we must provide 
support for several ARS projects in which there are critical and 
immediate needs.
    The $45 million also includes $22 million in funding for five 
locations, in addition to the two Nutrition Research Centers. This 
includes $14 million for the Regional Research Centers located in 
Albany, Peoria, Philadelphia, and New Orleans, which all need major 
infrastructure replacement and modernization. Another $8.2 million is 
requested for the Plum Island Animal Disease Center. Current biosafety 
and biocontainment standards and regulatory issues relating to 
environmental quality and energy conservation are among many concerns 
that indicate the facility is in serious need of modernization. The 
increases for renovations are the product of careful planning over 
several years and are vital for ARS to continue its high quality and 
productive research for which it is world renowned.
    The President's fiscal year 2000 budget provides $1.1 billion for 
the Cooperative State Research, Education, and Extension Service. This 
includes $948 million in the discretionary budget, an increase of $24 
million over fiscal year 1999. Within the discretionary budget, an 
increase of $81 million is provided for the National Research 
Initiative (NRI). The NRI increases will focus on several high priority 
areas, including development of integrated production systems, 
agricultural genomics, global change and food safety.
    As indicated above, the budget also includes $120 million in 
mandatory spending under the Reform Act for fiscal year 2000, and a 
total of $600 million over 5 years for the Initiative for Future 
Agriculture and Food Systems under the Reform Act. This competitive 
research, education and extension program will emphasize a multi-
disciplinary and multi-institutional approach to addressing high 
priority issues outlined in the law. The Administration strongly 
believes that the most appropriate and effective use of taxpayer 
dollars is through peer-reviewed competitively awarded research grants 
that focus on national issues and concerns. Programs such as the NRI 
and the Initiative for the Future Agriculture and Food Systems provide 
a very effective mechanism for attracting and focusing the highest 
quality research conducted across the country on high priority issues 
faced by the agriculture and food system. There is also evidence that a 
significant portion of competitive grants are awarded to land grant 
colleges, universities and State extension agencies. The 
Administration's budget should result in a major infusion of funds to 
these institutions.
    In addition to the NRI increases and the broader Initiative for 
Future Agriculture and Food Systems, the CSREES budget includes 
increases to empower less advantaged people and communities so they may 
improve their own lives and that of their families.
    The CSREES budget also includes increases in the Children, Youth 
and Families At Risk (CYFAR) program and Expanded Food and Nutrition 
Education Program. The goal of both programs is to help individuals and 
families gain the skills and create the environment that encourage 
individuals, families and community leaders to take responsibility for 
their own lives and that of their communities.
    In addition to the increases, the CSREES budget provides for a 
redirection of fiscal year 1999 funding for the new Integrated 
Research, Education, and Extension grant authority provided in the 
Reform Act. Bringing the research and education component together with 
extension affords the opportunity to integrate programs which draws on 
the strengths of both activities. The research agenda is more likely to 
be informed by extension's connection to the customer and extension is 
more likely to understand research findings coming from the research.
    In providing critical funding to the research, education, and 
extension programs of the Land Grant system and other universities and 
organizations across the country, CSREES continues to play a central 
role in helping generate new knowledge and technology and in 
facilitating the transfer of that knowledge and technology to those who 
will use it.
    The Economic Research Service's budget decreases from $63 million 
in fiscal year 1999 to $56 million in fiscal year 2000. As the 
Department's principal intramural economics and social science research 
agency, ERS conducts research and analysis on the efficiency, efficacy, 
and equity aspects of issues related to agriculture, food safety and 
nutrition, the environment, and rural development. The decreased 
funding level is due to the return of the food program studies to the 
Food and Nutrition Service. The fiscal year 2000 ERS budget supports 
new or enhanced research of approximately $2.9 million. In addition to 
the increases in the initiatives highlighted above, the ERS budget 
includes $0.9 million to enhance the Agency's program in commodity 
market analysis. The increase will allow ERS to further strengthen its 
commodity program to assure the maintenance of sufficient capacity to 
analyze the structure and peformance of commodity markets, contribute 
its analytical expertise to related Department activities and enhance 
the dissemination of analytical market information to customers who 
rely on its availability. Additional funds of $0.2 million will support 
an examination of the impact of electric utility deregulation on rural 
areas.
    The National Agricultural Statistics Service (NASS) budget declines 
by $3 million to $101 million due to the cyclical nature of Census of 
Agriculture funding. The market-oriented policy and the competitive 
global market in which agriculture exists make NASS's comprehensive, 
reliable, and timely data on U.S. agricultural commodities more 
critical than ever to farmers, ranchers, and other agribusinesses 
needing to make informed production and marketing decisions. The 
results of the 1997 Census, the first NASS has conducted, were released 
last month, 10 months ahead of schedule. The survey results show that 
with careful counting the number of farms was relatively stable over 
the last 5 years. While the overall NASS budget decreases, the agency's 
budget includes several increases to enhance and broaden its 
statistical program. They include $2.5 million to conduct a new fruits 
and vegetables survey as part of the Food Safety Initiative, $1.6 
million to collect pesticide use data for horticulture and greenhouse 
industries to support a science-based response to the Food Quality 
Protection Act and $1.8 million to conduct the decennial Agricultural 
Economics and Land Ownership Survey. An additional increase will allow 
for establishing a permanent NASS office in Puerto Rico. NASS is the 
only USDA agency with field offices that do not include Puerto Rico. 
The increase will facilitate both better statistics and better access 
to statistics for producers in Puerto Rico.
                                summary
    In summary, I want to reiterate that I believe that, given a tight 
budget environment, the REE agencies' budgets reflect a strong 
commitment to investment in agricultural research, statistics, 
education, and extension, one stronger than in the recent past. It also 
reflects an understanding that research and education are the key to 
solving not only the problems agriculture and its producers are facing 
today, but those of tomorrow. With continued strong investment we will 
be ready to meet those future problems. And if we are even smarter and 
more farsighted, we will employ research and education to mitigate 
agriculture problems before they overtake us. Thank you. We welcome 
your questions.
                                 ______
                                 
                   Rural Business-Cooperative Service
         Prepared Statement of Dayton J. Watkins, Administrator
    Mr. Chairman and members of the Subcommittee, I am pleased to 
appear before you today to present the Administration's fiscal year 
2000 Budget for the Rural Business-Cooperative Service (RBS).
    Mr. Chairman, the key to improving the economic conditions of rural 
areas, and particularly those areas experiencing decades of poverty and 
stagnant economies, is the creation of more business opportunities and 
more jobs. But, particularly jobs that pay wages that are sufficient to 
lift families out of poverty. Presently, service sector jobs are the 
leading employer in many rural areas, and as important as those jobs 
are to the local economy, they still do not pay a wage sufficient to 
support a family of four. Creation of these jobs is best accomplished 
by the private sector, but as we all know there are a number of rural 
areas in which private sector capital is not readily available, and it 
is these areas in which we target the programs of the Rural Business-
Cooperative Service. The $1.2 billion requested for the programs in 
this budget will assist in creating or saving about 100,000 jobs.
       business and industry guaranteed and direct loan programs
    For the Business and Industry (B&I) Program, the fiscal year 2000 
budget includes $31.1 million in budget authority to support $1.0 
billion in Guaranteed Loans and $50 million in Direct Loans, Since the 
streamlined Business and Industry Guaranteed Loan Program regulations 
were published in December 1996, demand for the program has increased 
300 percent. With this level of funding we estimate that these two 
programs will create or save over 40,000 jobs. But equally as 
important, under the guaranteed loan program we are able to help the 
local lender provide financing and this helps build community 
stability.
    Of the $1 billion requested for the guaranteed program we are again 
proposing to make available $200 million for financing for new 
cooperative businesses with a particular emphasis on new value-added 
cooperatives. Priority will be given to projects involving farmer-owned 
value-added cooperatives. In addition, this financing is available for 
guarantees of individual farmer's purchase of cooperative stock in a 
start-up cooperative established for value-added processing of an 
agricultural commodity raised by the individual farmer stockholders. We 
expect this program to be a key tool in capital investment in rural 
areas and as a means of helping farmers keep more of the income 
generated by their product.
                     intermediary relending program
    The fiscal year 2000 budget also includes $22.8 million in budget 
authority to support $52.5 million in loans under the Intermediary 
Relending Program. The initial investment of this level of funding will 
create or save an estimated 13,000 jobs, but because these funds are 
re-loaned 3 or 4 times by the intermediary, we estimate that over 
40,000 jobs will result eventually. In an effort to be of more 
assistance through this program we revised the regulations in 1998 to 
expand the $2 million cap on loans to intermediaries to a $15 million 
cap to any one intermediary in annual increments of $1 million. The 
regulation is more user-friendly and authorizes the Rural Development 
State Offices to process applications at the State level, rather than 
submitting applications to the National Office for processing. This 
change has speeded up the application process and allows State Offices 
to work closer with borrowers to provide immediate feedback concerning 
their applications. Pursuant to Rural Development's mission of 
prioritizing the most under served communities we are prioritizing the 
neediest communities, such as those in low-income or under served 
areas, those with declining populations, or communities faced with 
economic restructuring or economic disasters. In addition, the eligible 
purposes for loans to businesses have been expanded. The demand for 
this program continues to be strong.
                    rural business enterprise grants
    For the Rural Business Enterprise Grants Program, the fiscal year 
2000 budget includes almost $36 million. We anticipate that this level 
of funding will provide over 14,000 new jobs. The purpose of this 
program is to assist small and emerging businesses and the small amount 
of funds we typically invest in a project, on a dollar-for-dollar basis 
generates another $2.40 in private capital.
              rural economic development loans and grants
    The fiscal year 2000 budget requests $15 million in Economic 
Development Loans and $4 million in grants. These programs represent a 
unique partnership since they directly involve the Rural Electric and 
Telecommunication borrowers in community and economic development 
projects. They are the intermediaries through which these funds are 
invested locally and each dollar invested through these programs 
attracts an additional $3 dollars in other capital. The loan program is 
a zero interest loan to the cooperative which guarantees repayment of 
the loan to the government. Loans are used primarily for economic 
development activities while the grant funds can be used for 
establishing revolving loan funds and for community development 
projects.
                   rural business opportunity grants
    The fiscal year 2000 budget includes $5 million for Rural Business 
Opportunity Grants to provide much needed technical assistance and 
capacity building in rural areas. We have determined through the 
Empowerment Zone/Enterprise Community process that the most significant 
non-capital need in most rural areas is the capacity to develop the 
economic and community development strategies that are necessary to 
attract private investment capital and Federal and state assistance. 
The vast majority of rural communities are served by part-time 
officials who do not have the time or the necessary training to compete 
with larger communities for funding that may be available to them. The 
funds requested under this program will aid in providing that 
invaluable assistance that allow communities to take the first step in 
assisting themselves.
                  rural cooperative development grants
    For Rural Cooperative Development Grants, the fiscal year 2000 
budget requests $5 million to provide continued support in the creation 
of new cooperative forms of business and to fund the existing and new 
Cooperative Development Centers who directly assist farmers and others 
in the development of new rural cooperatives, value-added processing, 
and other rural businesses. We are firmly committed to the philosophy 
that the development of new opportunities to enhance farmer income and 
simultaneously create new business and job opportunities for others is 
critical to the family farmer and to the renewal of many rural areas. 
While the farm economy does not produce as many jobs as it once did, it 
is still the key component of most local economies and must be the base 
for revitalizing these economies.
                    cooperative research agreements
    We are requesting $2 million for needed research on cooperatives. 
Cooperative Research Agreements are used by RBS to participate with 
universities and other entities in providing research that relates 
directly to the needs of rural cooperatives. This includes a diversity 
of needs, reflecting the many changes that are taking place for 
cooperatives, such as major expansions into value-added processing. 
There is a greater interest on the part of small farmers and others in 
applying the cooperative form of organization to non-agriculturally 
based enterprises. In the past, funding has been included with RBS' 
administrative expenses account.
            appropriate technology transfer for rural areas
    The fiscal year 2000 budget also includes $2 million for the 
Appropriate Technology Transfer for Rural Areas (ATTRA) program that 
provides producers and agribusiness advisors information on use of the 
best sustainable production practices. Encouragement of such practices 
lessens dependence on agricultural chemicals and is more 
environmentally friendly.
    The ATTRA program handled over 18,000 requests this past year and 
continues to be a major source of information on sustainable 
agriculture throughout the country through its 800 number and the use 
of Internet. We are asking for $2 million, an increase of $700,000, for 
the ATTRA program to accommodate expanding requests for information.
                               conclusion
    Over the past several years, RBS has been provided with increased 
program resources to use in meeting rural business and economic 
development needs. We have streamlined our programs, improved consumer 
focus and developed strategic relationships all to benefit the entire 
rural America. Each year we have used all of our resources in this new 
business environment, but still, the need exits for more resources to 
accommodate the needs of those communities not yet experiencing 
positive economic impact of America's economic prosperity. Mr. 
Chairman, this concludes my statement on the fiscal year 2000 Budget. I 
would be happy to respond to any questions the Subcommittee may have 
regarding the Business-Cooperative Development programs of the Rural 
Development Mission Area.
                                 ______
                                 

 Office of the Secretary for Rural Economics and Community Development

       Prepared Statement of Jill Long Thompson, Under Secretary
    Mr. Chairman, Members of the Subcommittee, it is a pleasure to 
present to you the fiscal year 2000 budget request for the Rural 
Development Mission Area. It is even more pleasurable when I can submit 
a program budget that is $800 million higher than the level enacted 
last year, but at a lower cost than last year. The increase reflects 
the President's strong commitment to rural America. It is also due to 
the President's strong commitment to balancing the budget, growing the 
economy and maintaining low interest rates, that we are able to keep 
our subsidy costs low.
    Mr. Chairman, the economic growth that we are enjoying has reached 
some parts of rural America, but it is not at all widespread 
geographically or demographically. For the most part rural America is 
still characterized by sluggish or declining economies, and many parts 
of the country are still plagued by high rates of poverty and 
unemployment rates. In fact, many rural areas have poverty rates as 
high as 20 percent. Among those most vulnerable to the effects of 
poverty are elderly women and children. Over 3 million children in 
rural areas live in poverty while almost one quarter of older Americans 
in rural areas also live in poverty and primarily in areas lacking 
adequate health care and social services. Many of the rural areas such 
as the Mississippi Delta, Native American reservations, and the 
Southwest border region, have endured decades of poverty, and it is 
these areas to which this Administration has devoted a significant 
portion of our staff and financial resources. We do so because these 
areas are also characterized by the lack of capacity to seek out the 
Federal and other financial assistance that could aid in improving 
their lives.
    Our efforts to improve the capacity of these areas to help 
themselves has coincided with the need to more effectively utilize 
administrative resources which we have accomplished through staff 
reductions and the closure of many of our local offices. We have 
attempted to compensate for the resulting lack of presence in some 
communities by building partnerships with other governmental entities, 
non-profit organizations, and the private sector. While we are making 
some progress there remains a large void of such assistance in many 
areas.
    Mr. Chairman, the President's commitment to rural America is deep, 
he knows the private sector is the key to resolving the many and 
differing economic problems affecting these areas, but he also knows 
that the private sector cannot accomplish the task alone. The private 
sector cannot finance housing for low and very low income families; the 
private sector cannot finance the thousands of water and waste water 
systems needed; the private sector cannot extend higher educational 
opportunities to remote rural areas; and the private sector cannot 
finance the thousands of fire and rescue projects, relying sometimes on 
the proceeds from bake sales and fish fries to repay loans, as we do on 
frequent occasion. Likewise, the Federal government cannot create the 
thousands of private jobs that are needed to raise the economic hopes 
of rural areas. But, we are demonstrating that the Federal government 
in partnership with the private sector and others can do much more than 
each of us can do alone. The private sector is now participating with 
us in more and more projects, and the private sector is beginning to 
realize, as the President recently stated, that these many pockets of 
poverty and high unemployment represent this country's largest untapped 
market. I am reminded of Henry Ford's answer to the negative reaction 
of fellow industrialists when he decided to give each employee a 
significant weekly raise, ``I am doing this so they can buy my cars.'' 
We cannot be content with the current, historically low unemployment 
rate; we must continue our efforts to work with the private sector to 
create more jobs, so the millions of individuals still mired in poverty 
can eventually buy the products produced by this economy.
    Mr. Chairman, poverty is insidious, and it destroys people's 
confidence, their desire and their drive. One can see the effects in 
too many rural areas of this country. Should anyone doubt the benefits 
of these programs, I challenge him or her to visit some of the areas I 
have, and see the optimism and joy of families when they move into a 
home they have built with their own hands; when they enjoy the benefits 
of clean running water in their homes for the first time, or when they 
see their children connected to the Internet where they can explore the 
world. These are just some of the reasons I am proud to present this 
budget request for your consideration.
                    rural development budget request
    The budget request for Rural Development is just under $11 billion 
for direct loan, loan guarantees, grants and technical assistance. It 
is an increase of $800 million over the fiscal year 1999 level, but it 
requires less budget authority than the current fiscal year. The 
request includes over $4 billion to support the President's National 
Home-ownership Initiative with an additional 50,000 more opportunities 
for home-ownership; a 12 percent increase in funding for the water and 
waste disposal loan and grant programs in support of the Water 2000 
Initiative; and $1.2 billion in funding for the business programs which 
will assist in creating or saving almost 70,000 jobs in rural America.
                         rural housing service
    Mr. Chairman, as I have said on numerous occasions, no single 
factor contributes more to the vitality and stability of a community 
than does home-ownership. And no sector of the economy contributes more 
to the growth of the economy than does home-ownership. Every month the 
Department of Commerce releases statistics on housing starts and this 
information is eagerly awaited by all of the financial institutions in 
our country. The effects on the economy are also evidenced by the 
policy decisions for annual reductions in Federal income tax revenues 
of about $94 billion for the deduction of mortgage interest, and other 
deductions attributable to the housing industry.
    Despite the positive economic effects of the housing industry, the 
budget process of the Federal government and the budget constraints we 
all must labor under, force our attention and our energy to the 
discussion of the comparatively meager $728 million in budget authority 
required to support the $5.9 billion in loans, loan guarantees, and 
grants needed by the less well off individuals in rural America. The 
economic value of the investments made by the Rural Housing Service are 
the same as those made by the private sector lenders, Mr. Chairman, but 
the societal and familial values can be much greater.
    The programs administered by the Rural Housing Service reach the 
families and individuals that cannot otherwise afford decent, safe, and 
sanitary housing. They reach families and individuals that the private 
sector cannot serve. And in many ways they reach two of the population 
groups most vulnerable to the effects of poverty elderly women and 
children.
                         single family housing
    The request for single family housing loans totals $4.3 billion, 
over $300 million more than available for fiscal year 1999 and 
requiring only $114 million in budget authority. Each new home 
constructed under this program provides 1.75 years of employment, over 
$50,000 in wages and generates over $20,000 in taxes for the local 
economy. In short, each new home generates much more economic value 
than it costs in budget authority. The average income of a borrower in 
the direct loan program is $17,000 and the average interest rate paid 
initially by these borrowers is about 4 percent, even though the 
interest rate can be subsidized to as low as 1 percent. The Rural 
Housing Service has been successful in stretching limited funding by 
generating private sector participation in this program. This effort 
began in 1996 with 20 partners and has now grown to 78 partners in 36 
states. However, as important as stretching limited resources, is the 
acquaintance of private lenders with rural areas which can generate 
even more business for the lender. The guaranteed loan program provides 
loans at the market rate and serves borrowers with more moderate 
incomes.
                          multi-family housing
    The multi-family housing direct loan program serves those 
individuals and families least able to afford suitable housing. The 
average annual income of our tenants is $7,300 and for the most part 
the tenants are elderly female heads of household living on minimum 
social security benefits. Yet, it is this program and its related 
rental assistance that presents the largest dilemma in terms of policy 
and budget decisions. Because of the tenants it serves, these loans are 
typically subsidized to 1 percent this contributes to a high subsidy 
cost. However these tenants have no housing alternatives. There is a 
tremendous need for this type of housing and while we need to remain 
cognizant of budget constraints we should not be blind to the most 
needy in this country. The guaranteed program that was begun just two 
years ago serves renters with higher incomes. The demand for the 
program is significant and the program is particularly well received as 
an effective way to ensure that rural businesses have a well housed 
work force. It promotes rural economic stability. We are requesting the 
program be increased from $75 million to $200 million and we are 
recommending legislation which will eliminate the subsidy cost. 
Presently, we are required to provide interest subsidies for at least 
20 percent of the loan funds and we have determined that this 
requirement is not necessary to ensure affordable housing is available. 
The subsidy cost can be redirected to programs serving the more needy.
                           rental assistance
    Rental assistance is a subsidy provided to the developers of the 
direct loan multi-family housing projects in the form of renewable 
five-year contracts. The contracts make up the difference between the 
required tenant payment (30 percent of income) and the market rental 
rate, or the rate required to amortize the loan. Rental Assistance is 
the single largest component of the cost of administering the rural 
housing programs. We are requesting $640 million for this program, an 
increase of $57 million from the fiscal year 1999 level. The largest 
portion of the funding is needed to renew existing contracts that will 
expire in 2000. The balance is needed for rehabilitation loans, loan 
servicing options and for new construction. The request for rental 
assistance is submitted as a ``forward funding'' request which calls 
for $440 million to be available in fiscal year 2000 and $200 million 
available on the first day of fiscal year 2001. While this represents a 
change in the budgeting method for this program, it will not delay the 
provision of rental assistance to our tenants.
                      mutual and self-help housing
    Mr. Chairman, this program is one of the most rewarding programs we 
administer and I encourage every member of this subcommittee to visit 
one of our sites to see the positive effects provided when families, 
who would not otherwise have an opportunity to be homeowners, join 
forces and build their own houses. The house becomes secondary to the 
benefits of self confidence and self assurance provided throughout the 
family and community. This pride is evidenced in the fact that the 
delinquency rate in these homes is less than others we finance and the 
borrowers move to conventional credit much faster than do other 
borrowers. We are requesting a slight increase of $4 million for this 
program bringing the level to $30 million. These grant funds provide 
the technical support needed by the families as they construct their 
homes which are then financed through the single family direct loan 
program.
                           farm labor housing
    We are requesting a combined increase of $9 million for the Farm 
Labor Housing loan and grant programs which will allow us to finance 
the construction and repair of 960 units for migrant and seasonal farm 
laborers, who with Native Americans are the worst housed populations in 
America. These programs are the only programs within the Federal 
government specifically designed to serve this population and the 
program is one of the few areas over which USDA has the jurisdiction to 
improve the lives of farm workers who are, in large part, responsible 
for the low cost other Americans have to pay for food. This program 
also helps to ensure that the children of farm workers are well cared 
for while their parents are at work. A substantial number of the 
projects constructed through this program provide child care facilites 
which are often administered through Head Start or Migrant Head Start.
                          community facilities
    We are requesting a significant increase in funding for community 
facilities. This is one of our most popular, but often overlooked 
programs from which we finance a wide variety of essential community 
projects, ranging from hospitals, nursing homes, and child care 
facilities to drainage improvements. For years most of the funds have 
financed health facilities and fire and safety projects, but a recent 
priority has been child care facilities which are desperately needed in 
rural areas and the need is growing as families move from welfare to 
work and single mothers are filling many of the new jobs created in 
rural areas. Since the inception of this initiative RHS has provided 
more than $42 million for 141 new or improved child care centers. In 
several of the projects RHS has partnered with Rural LISC, a non-profit 
organization and the Head Start program of the Department of Health and 
Human Services; we expect the partnership to grow even more in fiscal 
year 1999 and fiscal year 2000.
    For community facilities we are requesting $473 million for loans, 
loan guarantees and grants, an increase of $86 million. Included in the 
request for community facilities is $5 million to reinvigorate the 
effort to install severe weather early warning systems through out 
rural areas. Although the funding is requested under the community 
facilities program, the program will be administered by the Rural 
Utilities Service. This effort began initially in 1994 following 
widespread destruction and 30 deaths from tornados spawned by one storm 
in Alabama, Georgia and South Carolina. The Vice President called for 
95 percent coverage for rural America with early warning systems 
triggered by the National Weather Service. And while we had some 
initial success through voluntary efforts of our Electric and 
Telecommunication borrowers liability issues soon slowed the effort. 
The Vice President has renewed the effort and we estimate the total 
cost will be $50 million. The $5 million requested in this budget will 
finance the installation of the necessary equipment at 15 to 20 of the 
highest priority sites. In all cases we will make every effort to use 
existing towers which will reduce the cost per site by $200,000. This 
is a very small investment that could save a significant number of 
lives and help reduce the billions in property loss each year due to 
these storms.
                        rural utilities service
    Mr. Chairman, the Rural Utilities Service administers programs that 
have a long and proud history of contributing to the economic growth 
and stability of rural areas. These programs led to the economic 
prosperity of rural America and they continue to provide the 
infrastructure necessary to ensure economic growth in those areas that 
are still experiencing economic difficulty. While many have argued in 
prior years that these programs are no longer needed, the reality is 
that the need has only shifted from initial connectivity to electric 
and telephone service to maintenance of an aging infrastructure. The 
current argument from some quarters is that deregulation of the 
electric and telecommunications industries will drive down the cost of 
these services and that the service can be provided by the private 
sector. Mr. Chairman, there is a reason that the Federal government led 
the way in providing electric and telephone service to rural areas; the 
profit was not there to induce the private sector to make the initial 
investment and most rural areas are still not profit centers. And while 
competitive pricing will reduce prices on a macro level, the situation 
could be quite different on a micro level, particularly in rural areas. 
We must maintain our vigilance and ensure that rural areas are fairly 
treated in this era of deregulation. Many rural areas are currently 
having a very difficult time maintaining or attempting to rebuild 
viable economies. Rural economies are very sensitive to even minor 
changes and we should be very cautious as we proceed with deregulation.
    The budget request for Rural Utilities is $3.4 billion, a slight 
increase over fiscal year 1999 and the necessary budget authority 
required to support the request is almost $100 million less than that 
needed in fiscal year 1999. Due to the growing demand for electric 
loans we are proposing a new direct loan program. The loans from this 
new $400 million program would be made at the Treasury rate requiring 
minimal budget authority. In total, we are requesting $1 billion for 
electric loans. For telecommunications loans, including the Rural 
Telephone Bank, we are requesting $645 million. We are again proposing 
the Rural Telephone Bank begin operating as a performance based 
organization with the goal of achieving privatization within ten years. 
We are in the process of finalizing legislation which will be submitted 
to Congress shortly to effect this transition.
                     distance learning/telemedicine
    For Distance Learning/Telemedicine loans and grants, the budget 
requests a total of $220 million, an increase of $58 million. The 
demand for this program continues to grow because it makes a real and 
immediate difference in people's lives, and the potential of the 
program increases with every improvement in technology. Rural Americans 
must be connected to the information superhighway, not because of the 
educational and medical purposes, but also because such access opens 
limitless opportunities for new business opportunities.
                        water and waste disposal
    We are requesting an increase of $156 million for the water and 
waste disposal and solid waste loan and grant programs at a cost of 
almost 50 percent less than required for fiscal year 1999. The total 
request is just less than $1.5 billion. This level of effort will 
provide new water service to approximately 650,000 rural residents, 
improved water service to 1.3 million rural residents and improved 
waste disposal services to another 600,000. Under the Water 2000 
Initiative, RUS will devote a portion of its resources to those 
families lacking running water in their homes or experiencing serious 
problems with drinking water. A side benefit of this investment is the 
creation of over 40,000 jobs, primarily in the construction trades, in 
rural areas.
    Mr. Chairman, the economic problems affecting many rural areas are 
most easily explained by the fact that 50 percent of all of the jobs in 
non-metropolitan areas are in the service industry. While these jobs 
are vital to local economies, they often do not provide enough income 
to support a family at anything but a subsistence level. More than 60 
percent of the rural families with incomes below the poverty level have 
family members with some type of employment, and 23 percent of the 
rural poor were either full time workers or were in families with one 
or more full time workers. Over half of the jobs in rural areas pay 
less than $17,000 annually and another one quarter pay less than 
$12,000. In most of these same areas we also find deficiencies in 
transportation, infrastructure, health care and social services. 
Increasing the incomes through the creation of employment is the best 
and most permanent solution to these problems and that is what we do 
through the efforts of the Rural Business-Cooperative Service.
                  rural business-cooperative services
    The budget request for these programs is $1.2 billion, a slight 
increase over the level provided for in fiscal year 1999. The request 
for the business and industry loan guarantee program is $1.0 billion, 
the same level as last year. Mr. Chairman, a recent report issued by 
the General Accounting Office demonstrates the commitment of this 
Administration to improve the stewardship over taxpayer dollars. While 
the program level has increased from $100 million in fiscal year 1993 
to $1 billion, the amount of outstanding principle delinquent has 
decreased from 22.5 percent to 6.1 percent and the percentage of 
borrowers delinquent has dropped from just under 14 percent to 5 
percent. This is a significant accomplishment and I am very proud of 
this staff.
    The budget also requests $52 million for the Intermediary Relending 
Program, an increase of $19 million over fiscal year 1999. This level 
of funding will leverage an additional $197 million in investment 
capital and create more than 12,000 jobs. These funds are relent 3 or 4 
times, which in turn creates more employment opportunities over the 
life of the original loan. For Rural Business Enterprise grants, we are 
requesting $36 million, $1 million less than available for fiscal year 
1999. We are also requesting $5 million for Rural Business Opportunity 
Grants to provide partnership technical assistance planning grants to 
help rural communities develop comprehensive economic revitalization 
strategies.
    For rural cooperative development grants, we are requesting $7 
million, an increase of $3 million. Rural cooperatives are growing both 
in numbers and in terms of non traditional types of cooperative-
businesses. Cooperatives are forming business alliances with private 
corporations, engaging in value added processing and beginning to enter 
the retail and export markets. Expanded use of the cooperative form of 
business is helping retain income in rural areas. The additional 
funding will aid in providing technical assistance to small farmers and 
small farm related operations in developing marketing and management 
skills. We are also requesting $2 million to continue cooperative 
related research through universities. In the past, this effort has 
been funded at the same level through the salaries and expense account. 
To further aid the formation of new cooperative businesses, we are 
again proposing to utilize up to $200 million in business and industry 
loan guarantees specifically for new cooperative businesses, including 
the guarantee of loans to individual members to purchase stock in a new 
cooperative. The level of funding requested for the Rural Business-
Cooperative Services will help create or save about 100,000 jobs 
throughout rural areas.
  alternative agricultural research and commercialization corporation
    The budget request for the Alternative Agricultural Research and 
Commercialization Corporation is $10 million, a significant increase 
over the level provided for fiscal year 1999. This level of funding 
will aid in bringing six new agriculturally based products to market 
and create about 1,500 jobs.
    Empowerment Zones/Enterprise Communities The budget request also 
includes $15 million for the second year funding for the five new rural 
Empowerment Zones and 20 new Enterprise Communities. As you know, the 
designations were announced in January of this year. The Administration 
is also proposing legislation which would provide mandatory funding in 
fiscal year 2000 and the out years for these communities. Our 
experience with the rural Empowerment Zones/Enterprise Communities is 
demonstrating that this approach to community revitalization is very 
successful because it involves the entire community, it empowers local 
residents to develop their own solutions and time-frames, and it 
addresses structural problems comprehensively rather than from the 
perspective of narrowly focused categorical assistance programs.
                         salaries and expenses
    Mr. Chairman, the Rural Development Mission Area is blessed with 
very capable, dedicated employees and it is only because of them that 
we have been successful in restructuring our field offices, downsizing 
the work force, re-engineering some of our business processes and still 
effectively delivering the programs. The vast majority of our employees 
are in the field offices and know first hand the value of the programs 
we administer because they live in rural areas. The number of full time 
employees has been reduced from over 9,500 to 7,100 since fiscal year 
1993, a reduction of 26 percent in a very short time frame. During the 
same time frame the Rural Development program level has increased from 
about $7 billion to $10.9 billion, an increase of 56 percent. Also 
during this same time frame we have asked our employees to take on 
additional responsibilities. We have reached our streamlining targets, 
and our employment will not decrease any further, unless we do not 
receive sufficient funding for salaries and expenses.
    The Secretary has recently decided to proceed with the 
implementation of administrative convergence, which will consolidate 
many of the headquarters and field administrative functions of the 
Natural Resource Conservation Service, the Farm Services Agency and 
Rural Development, as a means to achieve savings through improvements 
in administrative support. I am a strong supporter of this effort.
    The budget request for Salaries and Expenses is $542 million, an 
increase of $25 million over the level available in fiscal year 1999. 
There is no fat in this request. We have for too long deferred needed 
investments in a number of areas, particularly in information 
technology and accounting systems. Some of these systems are seriously 
outdated and incompatible with much of the current software that would 
allow us to work more efficiently. One firm visiting some of our field 
offices referred to them as museums for computer equipment.
    Mr. Chairman, both the Congress and the Administration can take 
pride in the accomplishments in reinventing and restructuring the 
federal government. However, we should ensure that we leave as our 
legacy a more effective and efficient system, not one that cannot 
function due to the lack of sufficient support. Our employees take 
great pride in what they do and they deserve our strong support. I ask 
for your serious consideration of this request.
    This concludes my comments. The Administrators and I are available 
for any questions the Members of the Subcommittee might have.
                                 ______
                                 
                         Rural Housing Service
          Prepared Statement of Jan E. Shadburn, Administrator
    Mr. Chairman and members of the Committee, thank you for this 
opportunity to testify on the President's fiscal year 2000 budget 
proposal.
    As you and the members of the Committee well know, the Asian 
economic crisis of the past year as well as drought, disease, and 
numerous other problems have had devastating effects on America's 
farmers, ranchers, and agricultural communities. Rural manufacturers 
have felt the effects as well, as they find that foreign markets can no 
longer absorb their products. The more than $5 billion for farmers and 
ranchers which you appropriated last year is helping to shore up the 
economies of rural communities across America. More will need to be 
done, though, as production agriculture and manufacturing continue to 
lose jobs to increases in productivity and other factors.\1\ Rural 
communities need help retaining their members, attracting new 
residents, and providing basic services. Rural Housing Service (RHS) 
programs meet these needs. Through partnerships that span the private, 
nonprofit, and public sectors, RHS provides rural American communities 
with affordable rental housing, homeownership opportunities, child care 
facilities, schools, and a multitude of services for the elderly. 
Together, these programs enhance community livability, create jobs, and 
add to local tax bases, giving rural communities the resources they 
need to grow and prosper.
---------------------------------------------------------------------------
    \1\ Throughout this testimony, I describe current socioeconomic 
conditions in rural America. All of the statistics and trends I cite 
come from the USDA Economic Research Service's (ERS's) 1997 and 1998 
Rural Conditions and Trends Socioeconomic Conditions Issues, as well as 
from 1998 Agricultural Outlook reports. ERS typically reports these 
data in terms of ``non-metropolitan'' and ``metropolitan''. For 
convenience, I use the term ``rural'' to refer to non-metropolitan and 
``urban'' to metropolitan.
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 rural housing service programs help level the playing field for rural 
                                children
    Today, rural children are at an economic disadvantage compared with 
urban children. Twenty-four percent of America's 14 million rural 
children live in poverty. To show you how insubstantial the resources 
for these children are, the poverty threshold in 1996 for a family with 
two adults and two children was $15,911; for a family with one adult 
and one child, it was $8,163. Children of color bear a tremendous share 
of this burden: 50 percent of rural African American children live in 
poverty, as do 46 percent of rural Latino children and 41 percent of 
rural Native American children. Urban children, by contrast, are better 
off: they are less likely to live in poverty and more likely to live in 
middle- and upper-class homes. In 1997, 39 percent of urban children 
lived in households with incomes higher than 300 percent of poverty, 
compared to only 25 percent of rural children. Rural children deserve 
the same opportunities as urban children. By providing affordable and 
safe rental housing, homeownership opportunities, and essential 
community facilities such as child care centers and schools, RHS can 
help rural communities level the playing field.
    Rural communities often have difficulty housing their poor citizens 
for the following reason: poor rural people cannot afford their housing 
because they lack the necessary income, not because rural housing is 
very expensive. In fact, almost 60 percent of poor rural households who 
pay more than 30 percent of their income towards housing and utilities 
pay less than $500 each month for housing costs. As you know, many 
families find it difficult these days to make ends meet, even when they 
work full time. Wages in rural areas are often insufficient to lift 
families out of poverty.
    The RHS Section 521 Rental Assistance program, the Section 515 
Rural Rental Housing program, and the Section 514/516 Farm Labor 
Housing program directly address the problem of housing affordability 
by filling the income gap. In fact, the average income for tenants in 
Section 515 and Farm Labor Housing is $7,300. The Rental Assistance 
program ensures that families living in Section 515 and Farm Labor 
Housing pay no more than 30 percent of their incomes toward rent and 
utilities by providing landlords with a grant to make up the 
difference. Even with Rental Assistance, some families have so little 
income that they must make choices between necessities such as medicine 
and food. The Section 515 and Farm Labor Housing programs decrease the 
income gap by providing very low interest loans and grants to 
developers, who in turn are able to provide tenants with below-market 
rents for safe and comfortable housing. Currently, 225,750 households 
receive Rental Assistance. About half are young single people and 
families, and the remainder are elderly. More than 452,000 families are 
living in the decent, safe, and comfortable housing that the Section 
515 and Farm Labor Housing programs provide. Illustrative of the 
tremendous need for this housing is the fact that 86,000 Section 515 
and Farm Labor Housing tenants pay more than 30 percent of their income 
towards rent, and 29,000 pay more than 50 percent, yet these families 
remain in RHS housing. Even though they are heavily rent overburdened, 
these tenants still see RHS housing as their best alternative.
    The President's proposed $640 million Rental Assistance budget will 
enable 41,800 households to remain in either Section 515 or Farm Labor 
Housing, helping young families to provide a stable environment for 
their children and affording elderly households the income security 
they would not otherwise have. The proposed budget will also provide 
Rental Assistance to new Farm Labor Housing apartments as well as to 
rehabilitated Section 515 and Farm Labor Housing apartments. In 
addition, it will provide a limited amount of new construction and 
emergency servicing Rental Assistance. Emergency servicing Rental 
Assistance is crucial in disasters such as the recent California citrus 
freeze, which by destroying citrus crops also devastated the economies 
of numerous small towns and took away the seasonal jobs of hundreds of 
agricultural workers. Without the emergency Rental Assistance RHS is 
providing, those agricultural workers who live in RHS's Section 515 
Rural Rental Housing would have not have been able to make their 
monthly rent payments, jeopardizing not only their own housing security 
but also the financial viability of their entire Section 515 complex.
    The President's budget of $100 million for the Section 515 Rural 
Rental Housing program will ensure that RHS is able to maintain its 
17,000 complexes in good repair and to provide approximately 1,900 new 
apartments. Funding for the Section 515 program directly benefits the 
very poorest children, their parents, and elderly people. These are 
people whom communities struggle to provide with good housing.
    The President's $40 million budget for the Farm Labor Housing 
program will allow RHS to provide farmworkers and their families with 
approximately 600 new apartments and 350 rehabilitated apartments. 
Farmworkers are one of the most poorly-housed populations in the 
country, and, as I have already pointed out, 46 percent of rural Latino 
children live in poverty. The 113 additional units that the proposed 
budget increase provides will ensure that at least a few of these 
children are able to live in the safe, pleasant housing that is so 
often out of reach for farmworkers.
    RHS is working to improve tenants' quality of life and self-
sufficiency by promoting on-site services such as computer training, 
reading programs for children, resume preparation for job seekers, 
tutoring services for children and adults, health services, Meals on 
Wheels, and fitness classes. By working together with the Office of the 
Inspector General (OIG) to find and correct any fraud or abuse, we are 
also making sure that the most vulnerable in our society are protected. 
This partnership with the OIG complements our implementation of the 
reforms you mandated, as well as the over 100 administrative measures 
we have taken to improve the program.
    For those families with low and moderate incomes who wish to rent 
apartments, RHS has begun providing the Section 538 Rural Rental 
Housing guaranteed loan program. The average rent for a Section 538 
apartment is $455 per month. The President's proposed budget of $200 
million for this program will allow RHS to provide almost 5,400 new 
apartments to rural families. Included in the President's budget is a 
legislative proposal which would remove the requirement that 20 percent 
of loans be subsidized, thereby removing the main source of subsidy 
cost. This legislative change would allow RHS to receive twice as much 
money and provide twice as many apartments as it would be able to were 
the subsidy requirement to remain.
    I have discussed the rental housing options RHS provides rural 
American families and their communities. Now I would like to spend a 
few minutes telling you about how we serve rural families who have 
demonstrated their ability to repay a loan and wish to own their home. 
The Section 502 direct loan program, and its companion program, the 
Mutual Self-Help Housing program, are targeted at people who earn 80 
percent or less than the median income in their area. These programs 
give borrowers and their children the boost they need to move out of 
poverty. We recently commissioned the USDA Economic Research Service 
(ERS) to conduct a national survey of borrowers who have received 
Section 502 direct loans since 1995, whether for Self-Help or for 
contractor-built homes. The results were impressive. First, 25 percent 
of borrowers had at some time received government rental assistance. As 
a matter of fact, we know that many of the families who participate in 
the Self-Help program are farmworkers who once lived in RHS-funded farm 
labor housing. Now these families are paying a mortgage, and by the 
time they leave the program they are likely to have moved off interest 
credit and to be paying the note rate on their loans. The ERS survey 
shows that 83 percent of borrowers were first-time homebuyers. Ninety 
percent said that they were living in a better home than they were 
before, and 61 percent said they were living in a better neighborhood 
than before. To show you what a good investment we have been making 
over the past four years, Section 502 homes seem to have appreciated in 
value, with a median purchase price of $64,800 and an estimated current 
value of $72,000. RHS borrowers are sinking roots into their 
communities, providing their children with so many benefits: a 
comfortable and safe home they can be proud of, a better neighborhood, 
and, eventually, equity against which to borrow for a college 
education, a business expansion, or even another home.
    Let me share with you what a difference the Section 502 direct loan 
program has made in the life of one Mississippi family. Ms. Ruby Jean 
Lee is a 48-year-old single parent of three children, ages eleven, 
thirteen, and seventeen. She is currently employed at Northwest 
Community College in Senatobia and earns an annual income of $9,300. 
Until a few days ago, she and her children were living in an 
overcrowded old wood-frame house with a leaky roof, weak floors, 
inadequate heat, and nonfunctional plumbing. In July 1998, Ms. Lee 
applied for a Section 502 direct loan. She was certified eligible, and 
in October she closed her loan of $65,000. She and her children moved 
into their new three-bedroom, two-bathroom home in February 1999. Ms. 
Lee and her children finally have a water-tight roof, good heating 
system, solid floors, and indoor plumbing that works. The Section 502 
direct loan program that is included in the President's budget will 
allow for 1,730 more such opportunities, for a total of 16,630 
families.
    The President's budget provides a $4 million increase for the Self-
Help Housing Technical Assistance Grant program, bringing the program 
level to $30 million. This increase will allow RHS to provide 
approximately 16 new technical assistance grants to Self-Help 
organizations in underserved communities such as Empowerment Zones and 
Enterprise Communities, as well as in areas which currently do not have 
a Self-Help program. It will also allow 1,900 families to build their 
own homes, an increase of 370.
    For low- and moderate-income families, RHS offers the Section 502 
Single Family guaranteed loan program. This program eliminates the 
downpayment barrier that prevents many young families from becoming 
homeowners by providing financing for the full value of the home. The 
President's budget of $3.2 billion for the Section 502 guaranteed loan 
program will finance more than 34,000 homes.
    RHS multi- and single-family housing programs provide high quality, 
affordable housing to rural American families. Communities benefit from 
these programs not only because they increase their housing stock but 
also because they realize the jobs, local taxes, and fees generated by 
construction. Using the National Association of Home Builders' 
estimates of the economic benefits generated by housing construction, 
the President's budget for RHS multi-family housing will create and 
preserve more than 8,000 jobs in construction and construction-related 
industries, $268 million in wages, and $142 million in combined 
federal, state, and local revenues and fees. The President's single 
family housing budget will create and preserve more than 35,000 jobs, 
$1.1 billion in wages, and $601 million in revenues and fees.
    In order to retain and attract young working families, rural 
communities must offer not only safe and affordable homes but also good 
day care and schools. Today, rural children under the age of six face 
higher poverty rates than older children, with children of color 
bearing a disproportionate burden: young African American children are 
three times as likely to be poor as white children, and young Latino 
and Native American children are twice as likely. Research by ERS 
suggests that the reason young children suffer higher poverty rates 
than older children is that rural areas lack the child care facilities 
which enable parents to go to work. Many rural parents face a tough 
choice: go to work to increase their family's income but worry 
constantly about whether their children are safe and well cared for, or 
live in poverty in order to stay at home to take good care of their 
children. RHS's Farm Labor Housing and Community Facilities programs 
offer a way out of this dilemma by providing much-needed safe, high 
quality child care facilities.
    Although housing complexes financed through the Farm Labor Housing 
program are not required to provide child care facilities, these 
facilities are an eligible loan purpose of the program, and many 
borrowers have taken advantage of the opportunity to provide them to 
their tenants. These facilities are critical to farmworker families, 
whose economic circumstances are sometimes so dire that they must bring 
their young children with them into the fields. RHS is continuing to 
encourage its Farm Labor Housing borrowers to build child care 
facilities. RHS has also greatly augmented the number of child care 
facilities it funds through the Community Facilities program, financing 
13 centers in 1995, 19 in 1996, 33 in 1997, and 46 in 1998. The 
facilities financed in 1997 and 1998 alone will serve more than 10,000 
children, and we plan to continue this high level of commitment to 
providing child care facilities.
    One of the biggest determinants of success in life is education, 
and mobile young families often relocate to be near good schools. 
Because small rural communities have difficulty obtaining funds to 
build and repair educational facilities, RHS provides these communities 
with Community Facilities direct loans, guarantees, and grants. RHS has 
funded schools, including schools for people with mental or physical 
disabilities, teacher housing, dormitories, and all-purpose college 
campus buildings. We have also joined a partnership with the American 
Indian Higher Education Consortium to assist this organization with 
funding tribal colleges. Since 1993, we have provided $3 million in 
direct loans and grants to build college facilities in Montana, North 
Dakota, and Arizona. In addition, Rural Development State Directors 
with large Native American populations have been expanding their 
outreach and communication with tribal leaders. As a result of this 
interaction, we expect in the future to be funding more community 
facilities and housing for Native Americans.
    The President's proposed $473 million budget for the Community 
Facilities direct loan, guaranteed loan, and grant programs will ensure 
that we are able to continue these expanded child care and educational 
services, as well as to continue our commitment to providing high 
quality health care and emergency services facilities. The increases in 
the direct loan and grant programs will allow RHS to expand services in 
the most distressed communities, including Empowerment Zones and 
Enterprise Communities.
    rhs programs provide rural america's elderly poor with safe and 
                           affordable housing
    In 1996, 9 million of rural America's 54 million people were 60 
years old or older. Twenty-nine percent of rural seniors between the 
ages of 60-74 were poor or near-poor (100-149 percent of the poverty 
level), as were a staggering 42 percent of people over the age of 74. 
Poverty among seniors increases with the degree to which their 
surroundings are rural, with elderly poverty rates being highest in the 
most remote areas and the lowest in urban centers. Ironically, because 
the likelihood of poverty among seniors increases with age, those who 
typically have the greatest need for assistance with the tasks of every 
day life are the least able to pay for it.
    The children of the Great Depression worked all their lives to 
build the rural economy. Many of them did not work in jobs with 
retirement plans, and they survive on their monthly social security 
check, food stamps, and Supplemental Security Income (SSI). Many of 
them are living in housing worse than what they had during the 
Depression and to varying degrees are struggling to take care of 
themselves. Often, their children lack the resources to help them, as 
do their communities. Every day, through its home repair, rental 
housing, and community facilities programs, RHS provides modern housing 
for the first time to elderly people who have been chopping wood for 
heating or walking to a well for water because their homes are so 
decrepit.
    The Section 504 grant and loan programs directly address the 
housing rehabilitation needs of very low-income seniors who own their 
own homes.\2\ The median income of beneficiaries of both programs is 
less than $9,000. Often, our customers have no choice but to remain in 
the substandard homes in which they have lived for decades, and the 
programs makes a tremendous difference in their quality of life. The 
President proposes a budget of $30 million for the grant program and 
$32.4 million for the loan program. Combined, this funding will allow 
both of these heavily oversubscribed programs to improve the homes of 
11,200 households with basics most Americans take for granted: a roof 
that does not leak, indoor plumbing, an air conditioner, an electric or 
gas heating system, a solid floor, or an electrical system that meets 
the fire code. They will also allow seniors to retrofit their homes to 
accommodate disabilities, for example by installing low counters, 
handrails, and ramps for wheel chairs.
---------------------------------------------------------------------------
    \2\ The Section 504 grant program is limited to rural seniors while 
the Section 504 loan program is available to any rural person with a 
very low income. However, 60 percent of loan program beneficiaries are 
seniors.
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    The Section 515 program provides a highly valued residential 
alternative to relatively independent rural seniors who find that they 
can no longer keep up with the yard work and structural maintenance 
that homeownership requires. In addition to being virtually 
maintenance-free, Section 515 apartments for elderly and disabled 
people are equipped with special amenities such as strategically placed 
handrails and emergency call buttons or lights with which to signal for 
help. They are also wheelchair accessible. Managers of these complexes 
often arrange for services such as transportation, grocery and 
pharmaceutical delivery, Meals on Wheels, health screenings, and 
entertainment, and they make sure that the community rooms stay in 
constant use. In addition, a small percentage of Section 515 complexes 
offer congregate facilities in which seniors receive at least one meal 
per day. Many seniors in Section 515 housing receive Rental Assistance, 
as well, enabling their small incomes to go further to cover costs of 
prescription drugs, food, and other necessities.
    Margaret Bakken is one of the more than 180,000 seniors who is 
currently benefiting from Section 515 housing. She also receives Rental 
Assistance. In October 1989, she and her husband Norbert Bakken, who 
then were 77 and 85 years old respectively, completed an application to 
live in the Section 515-funded Pine Ridge Apartments in Ridgeland, 
Wisconsin. Their rural Chetek home was heated only by wood and lacked 
plumbing and an indoor toilet. Mr. Bakken was physically unable to chop 
wood and haul water, so Mrs. Bakken had to perform these demanding 
tasks every day. At the time she and her husband applied to live at 
Pine Ridge, she could no longer keep up with these chores and with the 
maintenance of her old house. She was worried about how she and her 
husband would survive the coming winter. Mr. and Mrs. Bakken were 
overjoyed and extremely grateful that their application was accepted 
and that they could move into a warm, comfortable, and secure 
apartment. Without the aid of the Section 515 program and a monthly 
Rental Assistance payment of $261, the Bakkens could not have afforded 
such a nice home on their annual income of $6,960. In December 1995, 
Mr. Bakken passed away. Mrs. Bakken, now 87 years old, remains a tenant 
at Pine Ridge Apartments. She tells us she loves her home and enjoys 
the quiet, safe environment. The assistance she receives through RHS 
allows her to live a comfortable life, unlike many of her peers.
    In addition to providing housing repair loans and grants and 
subsidized rental housing, RHS also provides elderly rural Americans 
with numerous community facilities, including assisted living 
facilities, boarding homes, adult day care centers, intergenerational 
care centers, retirement homes, and nursing homes. The program also 
invests heavily in rural health care facilities, from which seniors 
typically benefit in great measure. In 1997, RHS invested $51 million--
23 percent of its total Community Facilities funds for the year--to 
either build or make improvements to 33 senior facilities. In 1998, we 
invested $43 million in 40 facilities. We plan to continue our 
commitment to serving the ever-increasing rural elderly population.
   rhs and its partners leverage their resources to build communities
    None of the programs I have described would be successful without 
the help of our many partners. Without the strong interest and support 
of our network of 2,000 private lenders, the Section 502 guaranteed 
loan program would not have been able to help 39,400 families become 
homeowners last year. These same lenders are also working hard to make 
our Section 538 guaranteed loan program a success. Our nonprofit 
technical assistance grantees are at the heart of the Section 523 
Mutual Self-Help Housing program, which has made homeownership a 
reality for thousands of people for whom it seemed impossible. 
Nonprofit organizations also help package our loans, performing 
valuable outreach to underserved communities in the process and helping 
to stretch our limited staff resources. And our nonprofit and 
government partners in the Rural Home Loan Partnership have played 
pivotal roles in expanding the reach of the Section 502 direct loan 
program. Thanks to the combined efforts of the Rural Local Initiatives 
Support Corporation (Rural LISC), the Federal Home Loan Bank System, 
the Office of Thrift Supervision, the Federal Deposit Insurance 
Corporation, and RHS, in 1998 the Partnership made home loans worth 
$19.8 million ($13 million in Section 502 direct loans, $6.8 million 
from private and nonprofit lenders) to help 284 families become 
homeowners. Nonprofit community development corporations provided them 
with homebuyer education to ensure that they will be successful 
borrowers.
    Finally, let me discuss the contributions of our most important 
partners, the citizens of rural America. So often we hear of how a 
town's citizens rally to improve the housing conditions of one of our 
customers. In an Appalachian community in eastern Ohio, for example, 
students at the high school build one new home each year for a local 
family. In a community with an unemployment rate of 10 percent, their 
contribution makes a real difference. Recently, one young couple with a 
four-year-old child received one of these homes, which they financed 
through a $70,000 Section 502 direct loan. Through this arrangement, 
the family was able to save $20,000 in labor costs, and the students 
learned marketable construction skills.
    Another fine example of RHS and a community working together to 
improve the life of a local resident took place in southern New Mexico. 
An eighty-six-year-old woman, who has been deaf since childhood, has 
lived her whole life in the home her parents built. When the woman's 
friends approached the local public works office and the local Rural 
Development office for assistance, her home lacked a septic system and 
indoor plumbing, had no kitchen facilities other than a wood stove, and 
had a leaking roof and a dirt floor. Rural Development was able to 
provide a Section 504 grant for $7,500. The public works employees 
began soliciting help from the community to augment this grant. They 
were able to secure $10,000 in materials and donated labor. Many 
citizens from the town, as well as Rural Development and public works 
employees, provided their labor to the renovations. When the 
renovations were completed, the home had a new roof, floor, kitchen, 
septic system, and remodeled interior. Because so many people from the 
city, various businesses, and private individuals donated their time, 
money, and materials to remodel this home, this Section 504 grant truly 
turned into a community development project.
    Mr. Chairman and members of the Committee, with your continued 
support, RHS and our thousands of partners around the country will 
continue to lay the foundations for a strong rural America.
                                 ______
                                 
                        Rural Utilities Service
            Prepared Statement of Wally Beyer, Administrator
    Mr. Chairman, members of the subcommittee, thank you for the 
opportunity to submit the President's fiscal year 2000 budget and 
program proposals for the Rural Utilities Service (RUS). I want to 
begin by thanking you and the members of the subcommittee for your 
continued support for the infrastructure programs and policies of rural 
America. Together, we are helping rural America invest in its 
communities and its future.
    A safe, affordable, modern utility infrastructure is a key 
component of economic competitiveness. It is also a fundamental 
building block of economic development. Dramatic regulatory and market 
changes are occurring in the telecommunications, electric and water 
utility sectors. Without the help of the RUS, rural communities will 
have a very difficult time financing their utility investments.
    At RUS, we are continuously working to enhance rural utility 
efficiency by encouraging system mergers, leveraging private capital 
and forging new partnerships for economic development. We are reforming 
our program regulations to be more customer friendly, focusing our 
resources on rural development and loan security.
    The nearly $42 billion RUS loan portfolio includes investments in 
approximately 7,500 small community and rural water and wastewater 
systems, and 2,000 telecommunications and electric systems, servicing 
approximately 84 percent of America's 3,096 counties. This 64-year old 
local/federal partnership is an American success story. It is a 
partnership providing critical infrastructure to 80 percent of the 
nation's landmass while enhancing the lives of 25 percent of the 
nation's population. That infrastructure spurs economic growth, creates 
jobs, and improves the quality of life in rural America. The vitality 
of rural communities truly depends on access to modern, reliable, and 
affordable utilities.
                reform, reinvention and responsibilities
    RUS is not your mother and father's REA! We are working to make RUS 
pro-active in a rapidly changing utilities market. The success of the 
public-private partnership between RUS and its borrowers depends on the 
ability of borrowers to respond quickly to changing conditions. 
Consistent with the spirit of reinvention, the RUS continues to 
streamline its policies, offering borrowers more flexibility in 
financing, while ensuring safe, reliable modern utility service to 
rural Americans.
    Specifically, RUS has reinvented its focus and activities by:
  --Targeting scarce Federal grant funds and limited budget authority 
        to those areas of our country that do not have basic utility 
        infrastructure; to those areas with the highest poverty levels 
        and out-migration of human, financial, and economic resources; 
        and to our Native Americans;
  --Developing varied and flexible financing programs that result in 
        substantial interest savings to RUS electric borrowers. Since 
        1993, RUS has refinanced or repriced $9 billion of high 
        interest Federal Financing Bank loans, saving rural consumers 
        $227 million;
  --Reducing regulatory burdens enabling eligible borrowers and rural 
        communities to more effectively and efficiently participate in 
        RUS programs;
  --Eliminating and simplifying RUS loan approval processes, allowing 
        borrowers to respond more quickly to the ever-changing 
        financial and economic markets;
  --Automating loan processing functions to provide borrowers faster 
        access to loan and grant funds while reducing the 
        administrative costs incurred by the Federal government. 
        Processing time for RUS loans has been slashed from 9 months to 
        less than 1 month;
  --Networking with Federal, State, and local government agencies in an 
        advocacy role for rural citizens;
  --Servicing an electric industry in revolution both technically and 
        financially;
  --Promoting a paperless society that makes the Federal government 
        more responsive to its customers while decreasing the national 
        paperwork burden; and
  --Leading the way to Y2K compliance. Since 1996 RUS has been a leader 
        in the effort to promote Y2K compliance among rural utilities.
               the federal partnership with rural america
    A diversified rural economy requires investment in infrastructure, 
and quality education and health care to foster economic growth. 
Affordable power creates on farm and off-farm employment. Modern 
wastewater treatment systems along with clean drinking water improve 
the rural environment and health. We must provide rural children with 
educational opportunities that will enable them to compete with the 
best and brightest from around the world. Our rapidly aging rural 
population must have affordable access to quality health care. Rural 
businesses need state-of-the-art communication technologies and 
affordable power to create new jobs and enhance the quality of life. 
All Americans should have a healthy environment and safe, clean 
drinking water and have their commercial and recreational water 
resources protected from contamination. RUS is helping rural 
communities in each of these areas.
    Our goal is to help provide rural America with the tools and 
resources necessary to realize the full extent of its potential. We are 
applying creative thinking, personal commitment, and customer service 
to program delivery.
                telecommunications--50 years of progress
    1999 marks the 50th Anniversary of the RUS Telecommunications 
Program. In 1949, when the Telecommunications program started, only 
about 39 percent of U.S. farms were receiving telephone service of any 
kind. During Congressional hearings, many witnesses testified to both 
the need and demand for rural telephones, for area coverage, and for a 
source of long-term financing to change from magneto to dial. A new era 
for rural telephony began with enactment of the REA telephone loan 
legislation. Congress ensured that adequate telephone service be made 
generally available in rural areas and to the widest practicable number 
of rural users of such service.
    Today, 50 years later, the RUS Telecommunications Program and the 
Rural Telephone Bank (RTB) have developed into successful, forward-
focused programs with a continuing, strong demand for investment 
capital. We are making certain that Rural America succeeds in the 
digital age.
    Advanced telecommunications services are crucial to rural America's 
economic development. Rural businesses must be able to compete and 
rural residents need better access to the global economy, quality 
health care, and quality educational opportunities. The concept of 
``basic'' voice telephone service no longer exists. ``Core'' services, 
defined in terms of speed and bandwidth, that evolve with new 
technologies must be established and delivered to rural America.
    Loans made by the RUS Telecommunications Program and RTB affect the 
lives of many rural residents. Rural telecommunications are providing 
advanced communications technologies for rural businesses, increased 
educational opportunities for rural students, and improved health care 
for rural residents. RUS and the RTB are working hard to assist 
borrowers in enhancing the standard of living, ensure the quality of 
life, and bring about economic development to rural America. As we 
approach the 50th anniversary, RUS has seen an increased demand for its 
financing.
    This year's telecommunications budget proposes $560 thousand in 
budget authority to support $50 million in direct hardship 
telecommunications loans and $2.4 million in budget authority to 
support $300 million in Treasury-rate loans, as well as $3.3 million in 
budget authority to support $175 million in Rural Telephone Bank (RTB) 
loans.
    The successful implementation of the Telecommunications Act of 1996 
is critical for rural consumers. In addition to being a lending agency, 
RUS continues to be an advocate for rural citizens before federal and 
state regulators. We firmly believe that the benefits of the digital 
revolution must be shared by all Americans. Continued capital 
investments and operational and technical support are critical to 
maintaining a high level of quality in areas served by RUS borrowers.
    The budget also reflects our commitment to privatize the RTB within 
the next 10 years. By establishing the RTB as a performance based 
organization (PBO), the RTB can demonstrate that its financial and 
managerial independence is consistent with privatization goals. The 
cost of the subsidy budget authority and administrative expenses would 
be paid from the unobligated RTB liquidating account balance in fiscal 
year 2000.
                   distance learning and telemedicine
    In the Distance Learning and Telemedicine (DLT) Program, the budget 
request of $20.7 million in budget authority will support $200 million 
DLT loans and $20 million in DLT grants.
    The Distance Learning and Telemedicine Program provides financial 
assistance for rural education and health care providers seeking to 
utilize advanced telecommunications technologies. DLT loans and grants 
provide needed infrastructure and high technology end-use equipment for 
rural areas. This program is a powerful complement to the e-rate which 
provides discounts for monthly services and connections to schools, 
libraries, and rural health care facilities. The Federal Communications 
Commission administers the e-rate as part of the Universal Service 
Support System. The DLT program and the e-rate provide an unparalleled 
opportunity to use telecommunications to enhance rural education and 
health care providers.
    Vice President Gore said it best when he announced the 1997 DLT 
awards. He stated: ``This country cannot afford a digital divide 
between those who have access to the benefits of the Information 
Superhighway and those who do not.''
    Since 1993, the DLT program has funded 252 projects totaling $68 
million in 43 states and two U.S. territories. These projects serve 850 
schools and learning centers and 600 hospitals and rural health 
clinics. The DLT programs provide seed money to leverage almost two 
times its investment from other private and public sources.
    Simply put, rural Americans must be connected to America's 
Information Superhighway. USDA/RUS is the catalyst for this rural 
connection.
                            electric program
    The Electric Program budget proposes $10 million in budget 
authority to support a program level of $1 billion dollars. The 
President's Budget requests $450,000 budget authority for a hardship 
program level of $50 million; $9 million budget authority for a 
municipal rate program level of $250 million. The budget proposal 
provides a $300 million funding level for guaranteed loans. The loan 
guarantees do not require any budget authority.
    The RUS Electric Program continues to serve one of the most 
effective local/public partnerships of the federal government. Today's 
program ensures that all areas of our nation have access to reliable, 
reasonably affordable, electric energy. We are also forging new and 
strengthened relationships with private lenders to offer RUS guarantee 
loans.
    Over the last several years, changes have been made in the electric 
lending program to reduce the overall federal cost of the program. In 
an effort to reduce the cost of the electric program and provide yet 
another financing tool to meet increasing demand, the Administration 
again proposes a new Treasury Rate Loan Program to complement its 
existing loan programs. This $400 million loan program can be generated 
with only $320,000 of budget authority.
    Each RUS electric loan dollar leverages an additional three dollars 
from private sources.
    In the coming years, rural distribution and power supply systems 
will require continued assistance in upgrading and replacing an aging 
electric infrastructure to support growing electricity demand, new 
technologies, and a more competitive industry structure. For example, 
RUS financing will enable rural electric systems to replace aging, 
inefficient and undersized electric transformers and conductors to 
enhance the reliability of distribution and transmission systems to 
meet load growth while cutting line losses, improving energy 
efficiency, and reducing carbon and other air pollution emissions.
    Demand for the RUS Electric Program exceeds available resources; 
there is currently a $1.3 billion waiting list for RUS electric 
financing assistance.
                     financially stressed borrowers
    RUS is also working very closely with electric borrowers facing 
financial stresses from past nuclear and large base-load generating 
plant investments and from increasing pressures from wholesale and 
retail competition. In each instance, RUS is diligent in ensuring that 
work-out agreements maximize the recovery to the Federal taxpayers. 
Today, RUS is actively working with six financially stressed borrowers 
as compared with some 15 borrowers four years ago.
    Since its inception, RUS has worked closely with its borrowers to 
ensure the integrity of its loan portfolio. The financial health of 
each RUS borrower is of the utmost concern to the Agency and when that 
health is threatened, RUS immediately undertakes the steps necessary to 
minimize delinquencies. RUS' loan security goals and debt collection 
activities maximize the collection of delinquent debts owed to the 
Federal government by ensuring that collection and correctional 
activities are promptly pursued.
                    water and environmental programs
    This budget seeks $503 million in budget authority for Water and 
Waste Disposal (WWD) grants; $2.746 million in budget authority for 
solid waste management grants; and $63.9 million in budget authority to 
support $900 million in WWD direct loans and $75 million in guaranteed 
loans.
    The budget request includes $20 million for Colonias along the U.S. 
Mexico border, $16.2 million for technical assistance and training 
grants, $5.3 million for the circuit rider program, $20 million for 
rural Alaskan villages, and $34.7 million in budget authority for loans 
and grants in empowerment zones and enterprise communities. Our budget 
request will also allow third-party grantees (such as rural water 
circuit riders) to make over 28,000 water systems and 29,000 wastewater 
system contacts to assist communities with intensive assistance, and 
through a clearinghouse effort taking 28,000 telephone calls and 11,000 
electronic bulletin board and web site contacts.
    As a result of the strong technical assistance efforts, both from 
staff and third-party grantees/contractors, loan delinquency and loan 
losses will remain low. Currently, 1 percent of borrowers are 
delinquent and since the inception of the water and waste disposal 
program less than 0.1 percent of the amount loaned has been written 
off.
    The RUS program improves the quality of life and health of about 
1.3 million Americans each year by bringing safe drinking water and 
environmentally sound wastewater facilities to those rural communities 
in the greatest need. The program is delivered by a field network of 
Rural Development employees who provide ``hands-on'' technical and 
financial assistance through the Rural Community Advancement Program 
(RCAP).
    In the Water and Environmental Program area, RUS has shown great 
leadership in using information age technologies to add value and 
efficiency. A RUS Intranet allows program delivery professionals up to 
the minute information, the ability to seek advice, share best 
practices and to store forms, bulletins, regulations and staff 
instructions online.
                   water 2000 presidential initiative
    The Water 2000 Initiative has been very successful at investing in 
the people and places where safe drinking water is needed most. The 
program has been so successful that demand for funds exceeds supply. 
Based on the Administration's belief and policy that low income, high 
unemployment and high poverty areas with water-related public health 
problems have the greatest needs, we increasingly target drinking water 
and environmental investments to those areas.
    In a state-by-state safe drinking water assessment performed in 
1995, RUS found that at least 2.5 million rural Americans had very 
critical needs for safe, dependable drinking water, including almost 
one million people who had no water piped into their homes. 
Approximately 5.6 million more were found to have serious needs under 
the Safe Drinking Water Act standards. At that time, the costs of 
meeting rural drinking water needs were estimated at $10 billion.
    Under Water 2000 targeting guidelines, over four fiscal years, RUS 
has committed almost $1.8 billion in loans and grants to over 1,000 of 
the nation's highest priority safe drinking water projects. Water 2000 
projects serve communities with the most limited financial resources 
and highest poverty rates. Once completed, Water 2000 projects funded 
as of October 1998 will provide 380,000 Americans water for the first 
time for the first time from properly constructed, maintained and 
tested public sources.
    Few tell the Water 2000 story as clearly or dramatically as Carole 
Buckland of Binghamton, New York. ``The families of Park Terrace in the 
town of Binghamton, New York are out of water! Water, the very thing 
that humans need for survival!'' Carole wrote in a letter to President 
Clinton, asking for help for her community. That letter triggered a 
series of events that brought Carole Buckland to Washington, D.C. on 
July 13th 1998 to meet Vice President Gore, who announced that 
Binghamton would have a Water 2000 project and that the Park Terrace 
families would have ``water, . . . clean, safe water that would bring a 
quality of life that most of us take for granted.''
    We are proud of our record of helping rural communities help 
themselves bring drinking water and wastewater facilities to thousands 
of Americans--with strong emphasis on those who truly need our services 
most. As the application backlog illustrates, this is a huge job that 
directly affects the health and safety and economic well-being of rural 
America.
     the new telecommunications & electric competitive environments
    To ensure that newly formulated policies address the role of rural 
utility systems in a deregulated marketplace, RUS has assumed a pro-
active role in discussions with the Federal Communications Commission, 
Federal Energy Regulatory Commission and our partners in the Executive 
Branch to protect and enhance RUS loan security and improve the lives 
of rural residents. As this nation grapples with telecommunications and 
electric industry market reforms, RUS will remain in the forefront of 
these discussions and will lead the policy debate as it impacts rural 
Americans. In an ever-changing legislative and regulatory environment, 
ensuring the security of a $36 billion portfolio of telecommunications 
and electric loans while providing modern, high quality, reliable, and 
affordable infrastructure in rural America will present a formidable 
challenge into the 21st Century.
                   electric restructuring legislation
    In 1998, President Clinton submitted legislation on electric retail 
market restructuring. Similar legislation is being prepared for 
reintroduction in 1999. I am pleased to report that the RUS made 
significant contributions to this landmark legislative proposal. No 
restructuring plan currently before the Congress is as complete or as 
sensitive to rural issues as the President's bill. The legislation 
recognized that restructuring will present challenges to rural areas 
and provide for a rural safety net of about $500 million a year to help 
mitigate any adverse effects on rural consumers. The USDA has looked 
very carefully at the effects of retail electric competition on rural 
communities. The proposal includes a flexible mandate, allowing states 
to opt out of retail competition. The bill also requires the Federal 
Energy Regulatory Commission to consider the multi-tiered nature of 
rural electric cooperatives; the tax exempt status of those 
cooperatives and the program interests and loan security of USDA in its 
rate-making authority. The RUS looks forward to working with the 
Congress to implement restructuring legislation which appropriately 
considers rural needs.
                       y2k outreach and readiness
    In addition to working within the Rural Development Mission Area to 
ensure USDA's Y2K compliance, RUS has been a national leader on Y2K 
industry outreach. RUS featured its first Y2K presentation at its 1996 
Telecommunications Engineering Symposium. In 1998, we aggressively 
brought the issue to the attention of our industry and community 
partners.
    In our telecommunications and electric programs, we have surveyed 
our borrowers and issued regulations requiring borrowers to provide Y2K 
compliance statements for new loans and loan advances. We have offered 
our assistance and will expedite processing of Y2K related loan 
requests. For our Water and Environmental Programs, which are 
administered at the state level, RUS has utilized state program 
managers and circuit riders as well as our national conference to 
conduct effective Y2K outreach.
    The RUS has also been very active in the President's Y2K council 
serving on the telephone, electric and environmental committees. Deputy 
Administrator Christopher McLean also serves on the Y2K Task Force of 
the National Association of Regulatory Commissioners.
    RUS takes the Y2K situation very seriously. It is a matter of 
public health, safety and national security. Even if utility outages 
are limited and isolated, the consequences of Y2K failures for the 
communities affected will be no less grave. This problem can not be 
underestimated.
                             weather radio
    Already in 1999, savage winter tornadoes have ripped through the 
states of Arkansas, Tennessee and Mississippi. When disastrous weather 
strikes, the difference between survival and the loss of human life can 
be a matter of minutes. With early warning, families, especially 
children and the elderly can be afforded sufficient time to protect 
themselves in the face of oncoming tornadoes, flash floods and 
hurricanes. The National Oceanic and Atmospheric Administration (NOAA) 
Early Warning Weather Radio network can help provide that margin of 
safety. NOAA weather radio provides warnings of dangerous weather 
conditions to nearly 70 percent of all Americans. The 30 percent of 
Americans without NOAA weather radio broadcasts are, however, almost 
entirely in rural areas.
    For several years, RUS has participated in this interagency effort 
to expand the coverage of NOAA Weather Radio and to upgrade the current 
system to an all hazards network that will also warn against potential 
terrorist, economic, and environmental dangers. We have already 
identified unserved areas and tower resources among RUS borrowers where 
NOAA weather radio transmitters could be installed. While there is much 
still to do in rural America, there are already several success stories 
to report from these efforts. The State of Alabama, for example, has 
achieved near total state-wide coverage.
    I am very pleased to report that the President's budget includes a 
new $5 million grant initiative in the Rural Development Community 
Facilities program to be administered by RUS that will add 
approximately 18 new transmitters to the NOAA Radio Network.
    RUS estimates that, at current costs, it will take about $50 
million to increase NOAA radio coverage from its current 70 percent to 
95 percent. The $5 million in the President's Budget is an important 
commitment and tremendous initial step towards protecting the lives of 
rural Americans.
                        native american outreach
    The Federal government has a special responsibility to and 
relationship with America's Native peoples. Since the earliest days of 
rural electrification, this agency has focused special attention on 
tribal communities. One of our earliest electric borrowers was the 
Navajo Nation. In telecommunications, five out of the seven tribally 
owned telephones companies are RUS borrowers. The significant RUS 
investments in utilities service in Alaska, provide service to some of 
the most remote native Alaskan villages. Just this year, the RUS 
Telecommunications Program made its second loan to Sandwich Isles 
Communications to provide state of the art telecommunications service 
to native Hawaiians living on homeland territory. The DLT program has 
also funded 21 projects serving tribal areas.
    RUS investments in drinking water and wastewater projects serving 
tribal and rural Alaskan communities have increased by nearly 400 
percent since fiscal year 1993, and continue to grow. RUS is uniquely 
dedicated to helping unserved and under-served communities. We expect 
that in fiscal year 1999, the annual investment in tribes from our 
Water and Environmental Programs will exceed $25 million. Additionally, 
we are intensifying coordination of funds with the Indian Health 
Service and the U.S. Environmental Protection Agency (EPA) at higher 
levels than ever before.
                               conclusion
    USDA/RUS continues to help rural America build its future. Our 
ability to succeed in the next century depends, to a large extent, on 
the investments in productivity enhancing modern infrastructure. No 
where is that need greater than in rural America. With your continued 
support, RUS will play a significant role in advancing rural America's 
quality of life and enhancing its competitiveness in the global 
marketplace.
    Thank you Mr. Chairman and the members of the committee.
                                 ______
                                 

                          SUBMITTED QUESTIONS

                      Departmental Administration

                 Questions Submitted by Senator Cochran
                            bravo initiative
    Question. What is the BRAVO initiative and when was this initiative 
first funded?
    Answer. Bringing Rural America Venture Opportunities, BRAVO, is a 
Secretarial business development program designed to assist Tribal 
entities--Indian Nations--in establishing small start-up information 
technology companies. BRAVO will create technology-based jobs on Indian 
Lands and in surrounding economically disadvantaged rural areas. 
Software development will be the initial services provided to USDA. 
Employees will be recruited/trained from Indian Reservations and 
economically disadvantaged individuals from surrounding areas.
    BRAVO was officially initiated during fiscal year 1999 with the 
addition of one GS-15 project manager position to the Office of Small 
and Disadvantaged Business Utilization's, OSDBU, FTE ceiling. OSDBU 
absorbed the costs of the position and has requested resources to 
support the BRAVO project in the fiscal year 2000 budget.
                           bravo obligations
    Question. The fiscal year 2000 budget indicates that $65,000 was 
obligated under other USDA appropriations for the BRAVO initiative in 
fiscal year 1999; no such obligations are projected for fiscal year 
2000. Please explain.
    Answer. As no funds were in Departmental Administration's fiscal 
year 1999 appropriation for BRAVO, OSDBU absorbed the cost. As OSDBU is 
a very small staff, one USDA program agency participating in BRAVO 
provided $65,000 toward the cost of this position. No such obligations 
are projected in fiscal year 2000 because OSDBU has requested funding 
for BRAVO as part of USDA's fiscal year 2000 budget.
                             target center
    Question. What is the TARGET Center?
    Answer. The United States Department of Agriculture, USDA 
Headquarters Technology Accessible Resources Gives Employment Today--
TARGET--Center established in 1992, in Washington, DC, and the Midwest 
TARGET Center established in 1995 in St. Louis, Missouri, support all 
USDA employees Nationwide. The Centers' mission is to provide policy, 
guidance, and support for applying accessible technology solutions 
within USDA for employees with disabilities. The TARGET Centers ensure 
compliance with Section 508 of the Rehabilitation Act of 1973, as 
amended. Furthermore, the TARGET Centers support the Department's 
workforce diversity and Federal workforce policies.
    The TARGET Centers provide a wide range of services to USDA and 
other Federal agency employees with disabilities, and their 
supervisors. Employees nationwide are able to request services from the 
TARGET Centers in order to address computer and telecommunication 
accessibility issues for employees with disabilities. These services 
include: evaluations, demonstrations, and assessments of assistive 
technologies and accommodations; review and analysis of accessible 
technologies; disability awareness presentations; coordination of 
training; resource information on accommodations, vendors, and 
technologies; contracting of accommodations services; technical 
support; consultations with managers and employees; and information 
provided in alternative, accessible formats.
    The TARGET Centers track Federal, State, local, and private 
initiatives regarding accessible workplace technologies and 
accommodations. As a liaison between the Department, the computer 
industry, schools, public organizations and associations, the TARGET 
Centers provide crucial information to USDA to ensure that 
accessibility requirements of employees with disabilities are included 
in decision making processes.
    Having established quality operational infrastructure, the TARGET 
Centers also support other Federal agencies through cross service 
agreements. These agencies include the Department of Housing and Urban 
Development, Department of Defense, Department of Energy, National 
Institutes of Health, and Food and Drug Administration.
    An intricate component of the USDA Accessible Technology Program, 
the USDA Headquarters TARGET Center was highlighted in December 1998 as 
one of three Federal government best practices in Re-charting the 
Course, the first report of the Presidential Task Force on Employment 
of Adults with Disabilities. This report was presented to Vice 
President Al Gore on December 14, 1998. In recognizing the success of 
the Center, USDA seeks to strengthen the impact the TARGET Centers have 
in creating a fully accessible USDA computer and telecommunication 
environment.
      funding and staffing levels for departmental administration
    Question. Provide a table showing the fiscal year 1997, 1998, 1999, 
and proposed 2000 funding and full-time equivalent staffing levels for 
the following Departmental Administration activities: (1) Office of 
Civil Rights; (2) Office of Outreach; (3) Office of Procurement and 
Property Management; (4) BRAVO initiative; (5) Office of Small and 
Disadvantaged Business Utilization; (6) Office of Human Resources 
Management; (7) Office of Ethics; (8) Office of Operations; (9) 
Management Support Staff; and (10) Office of Administrative Law Judges/
Judicial Officer.
    Answer. The information follows.

                                                          FUNDING AND STAFFING LEVELS--FISCAL YEARS 1997, 1998, 1999 AND PROPOSED 2000
                                                                                     [Dollars in thousands]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             1997 Act.                       1998 Act.                       1999 Est.                       2000 Est.
                           Activities                            -------------------------------------------------------------------------------------------------------------------------------
                                                                      Amount            FTE           Amount            FTE           Amount            FTE           Amount            FTE
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Civil Rights....................................................      \1\ $8,517              86     \1\ $12,242             129         $13,227             137         $14,868             154
Outreach........................................................  ..............  ..............             750               8           1,433              16           2,825              27
Procurement and Property Management.............................           2,961              33           2,741              32           3,261              35           3,507              35
BRAVO Initiative................................................  ..............  ..............  ..............  ..............  ..............  ..............         \2\ 194               1
Small and Disadvantaged Business Utilization....................             780              10             788               9           1,196              11           1,235              11
Human Resources Management......................................           5,772              78           5,596              81           6,969              84           7,219              84
Ethics..........................................................  ..............  ..............  ..............  ..............             600               5             618               5
Office of Operations............................................             762              11             673              13             987              14           1,014              14
Management Support Staff........................................           2,409              28           2,507              28           2,842              27           2,929              27
Administrative Law Judges/Judicial Officer......................           1,490              19           1,449              18           1,653              16           1,708              16
                                                                 -------------------------------------------------------------------------------------------------------------------------------
    Total.......................................................          22,691             265          26,746             318          32,168             345          36,117             374
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Fiscal years 1997 and 1998 reflect a transfer of $2,475,000 for the EEO Counselors.
\2\ The Bravo initiative is part of OSDBU's fiscal year 2000 President's Budget of $1,429,000.

                       hazardous waste management
    Question. How much of the $7 million increase proposed in fiscal 
year 2000 budget is for investigation and cleanup of Forest Service 
sites; how much is to continue and accelerate investigative and cleanup 
activities at ARS sites; how much for cleanup of CCC grain storage 
bins; and how much for cleanup actions at the sites of other USDA 
agencies? Please provide a status report of these activities and 
provide the fiscal year 1999 funding level.
    Answer. The proposed increase in fiscal year 2000 for Forest 
Service is $4,365,000; ARS work $479,000; CCC grain storage bins 
$1,500,000; and other agencies' work $646,000. The following tables 
summarize the funding allocation for fiscal year 1999 and the budget 
for fiscal year 2000 for the use of agency funds and the central 
hazardous waste management account.

                                   TOTAL USDA HAZARDOUS WASTE MANAGEMENT FUNDS
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year
                                                                     1999 HWM       Fiscal year
                             Agency                                   central       1999 agency    Total funding
                                                                      account         funding
----------------------------------------------------------------------------------------------------------------
Commodity Credit Corporation....................................          $3,000          $5,000          $8,000
Forest Service..................................................           6,900           9,000          15,900
Agricultural Research Service...................................           3,666  ..............           3,666
Farm Service Agency, Farm Credit Programs.......................  ..............       \1\ 1,000           1,000
Food Safety and Inspection Service..............................             230  ..............             230
Rural Housing Service...........................................              75              95             170
Office of the General Counsel...................................           1,379  ..............           1,379
Program Administration..........................................             450  ..............             450
                                                                 -----------------------------------------------
      Total, USDA HWM Funds.....................................          15,700          15,095          30,795
----------------------------------------------------------------------------------------------------------------
\1\ Estimates are roughly between $1 to $2 million.


                                 TOTAL USDA HAZARDOUS WASTE MANAGEMENT FUNDS \1\
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year
                                                                     2000 HWM       Fiscal year
                             Agency                                   central       2000 agency    Total funding
                                                                      account         funding
----------------------------------------------------------------------------------------------------------------
Commodity Credit Corporation....................................          $4,500          $5,000          $9,500
Forest Service..................................................          11,265          10,272          21,537
Agricultural Research Service...................................           4,145  ..............           4,145
Animal & Plant Health Insp. Service.............................             210             160             370
Farm Service Agency, Farm Credit Programs.......................             150       \2\ 1,000           1,150
Food Safety and Inspection Service..............................             230  ..............             230
Rural Housing Service...........................................              60              60             120
Office of the General Counsel...................................           1,569  ..............           1,569
Program Administration..........................................             571  ..............             571
                                                                 -----------------------------------------------
      Total, USDA HWM Funds.....................................          22,700          16,492          39,192
----------------------------------------------------------------------------------------------------------------
\1\ Central account figures are the amounts planned in the budget request and agency funding figures are amounts
  agencies have planned in their budget requests for agency funding of the program. These figures are subject to
  reevaluation and adjustment during the year as new developments occur.
\2\ Estimates are roughly between $1 to $2 million.

    Question. How much is requested for fiscal year 2000 to support an 
increased workload in the Office of General Counsel--OGCto continue to 
provide legal assistance and advice for hazardous waste management? 
What is the fiscal year 1999 level of funding?
    Answer. The fiscal year 1999 funding level for OGC is $1,379,000 
and the budget for fiscal year 2000 is $1,569,000 which is an increase 
of $190,000 in support of the increased workload.
    Question. Why isn't legal assistance and advice for hazardous waste 
management a cost borne by the Office of General Counsel--OGCrather 
than Hazardous Waste Management?
    Answer. The hazardous waste management account has been available 
for use on CERCLA/RCRA environmental compliance issues USDA-wide, 
including necessary legal services, since its inception in the fiscal 
year 1988 Agriculture Appropriations Act. Funding from this account is 
critical to ensuring that USDA agencies meet the complex requirements 
contained in hazardous materials laws, including State and local laws 
made applicable by broad waivers of sovereign immunity.
    The assistance provided by legal staff on identifying applicable 
regulatory requirements is an essential part of achieving environmental 
compliance at USDA and avoiding civil and criminal liability. The 
central hazardous waste management account is allocated to all affected 
USDA agencies by the Secretary based on critical needs in this area. 
The funds allocated for legal services from this account are based on a 
determination by the Secretary and USDA agencies that those services 
are necessary for USDA to support priority environmental projects. 
Although USDA agencies receive funding that may be used for 
environmental matters in addition to the central hazardous waste 
management account funds, this account was created so that priority 
environmental compliance issues would be funded, including legal 
services.
    It is worth noting that one of the important services provided by 
the OGC in this area is negotiation of cleanup agreements with parties 
responsible for contaminating lands and damaging resources under the 
jurisdiction of USDA. Last year alone, over $100 million in cleanup 
work on Federal lands was performed by the parties responsible for the 
harm, through agreements negotiated by the OGC. These cleanups would 
otherwise have been funded with scarce appropriated dollars or the 
damage would have continued unabated. Hazardous waste management 
appropriation funds expended by the OGC may also be recovered from 
responsible parties and returned to the account. It is based on an 
evaluation USDA-wide of the needs in this area that a portion of the 
central hazardous waste management account is allocated to the OGC.
                                 ______
                                 
                  Office of Chief Information Officer
                 Questions Submitted by Senator Cochran
            overall usda information technology (it) budget
    Question. I understand that USDA's IT budgets will exceed $1 
billion in fiscal year 2000. What are USDA's overall planned IT 
expenditures for fiscal year 2000 broken out by agency and staff 
offices?
    Answer. As reflected in the OMB Exhibit 42 report submitted in 
January, 1999, USDA has requested budget authority for IT of just over 
$1.2 billion. A copy of OMB Exhibit 42 is provided for the record, 
along with a summary of the major USDA IT Systems, specified by Agency.
    [The information follows:]

           USDA Formation Technology Portfolio--Highlights \1\

                              [In millions]

                                                        Fiscal year 1999
        Agency/System                                           estimate
Part 1:
    Mission Area--Financial Management System (and the financial 
      component of other systems):
        FNS/Agency Financial Management System....................     4
        FNS/Food Stamp Integrated Information System..............     2
        FS/Central Accounting System..............................    39
        FS/Integrated Personnel System............................     6
        FSA/CORE..................................................     3
        NRCS/Financial Management System..........................     6
        All Other USDA Financial Systems..........................    44
                                                                  ______
          Total USDA Financial Systems............................   104
    Mission Area--Other USDA Program and Administrative Systems:
        FNS/Food Stamp Integrated Information System..............     4
        FNS/FSA/AMS/Processed Commodities Inventory Management 
          System..................................................     9
        FNS/Electronic Benefits Transfer..........................    43
        FSIS/Field Automation Information Management System.......    12
        APHIS/Integrated Systems Acquisition......................     6
        FS/Integrated Personnel System............................     6
        FSA/RD/FAS/RMA/Service Center.............................    50
        RD/Dedicated Loan Origination System......................     5
        NRCS/Administrative Support and Records Management........     1
        All Other USDA Program and Administrative Systems.........   508
                                                                  ______
          Total Part 1............................................   748
                        =================================================================
                        ________________________________________________
Part 2:
    Data on Infrastructure and Office Automation:
        FS/Project 615............................................   100
        FS A /SCOAP...............................................    11
        All Other USDA Infrastructure and Office Automation 
          Systems.................................................   339
                                                                  ______
          Total Part 2............................................   450
                        =================================================================
                        ________________________________________________
Part 3:
    Data on IT Architecture and Planning: All Other USDA IT 
      Architecture and Planning Systems...........................
                                                                  ______
          Total Part 3..................................................
                        =================================================================
                        ________________________________________________
          Total--All USDA IT Systems.............................. 1,198

\1\ Source--OMB Exhibit 42 Report.


                        [In millions of dollars]
------------------------------------------------------------------------
                                                        CY--BA/  BY--BA/
                                                PY--BA    FTE      FTE
------------------------------------------------------------------------
                Resources for Financial
                    Management (6)
 
           Report on Resources for
            Financial Managment Activities:
               Asset Management:
       1001        No. of FTE                .......    6,563    6,561
       1002        Budget Authority          .......      409      425
               Accounting and Reporting:
       2001        No. of FTE                .......    2,157    2,159
       2002        Budget Authority          .......      127      131
               Audits of Financial
                Statements:
       3001        No. of FTE                .......  .......  .......
       3002        Budget Authority          .......        1        1
               Financial Management
                Systems:
       4001        No. of FTE                .......      739      738
       4002        Budget Authority          .......      129      125
                                            ----------------------------
                     Subtotal:
       5001              No. of FTE          .......    9,459    9,458
       5002              Budget Authority    .......      666      682
               Adjustments:
       6001        No. of FTE                .......  .......  .......
       6002        Budget Authority          .......  .......  .......
                                            ----------------------------
                     Total, net:
       7001              No. of FTE          .......    9,459    9,458
       7002              Budget Authority    .......      666      682
               Audits of Financial
                Statements Contract:
       8102        Budget Authority          .......        1        1
               In-house costs:
       8201        No. of FTE                .......  .......  .......
       8202        Budget Authority          .......  .......  .......
               Org-wide Financial
                Statements Contract:
       9102        Budget Authority          .......  .......  .......
               In-house costs:
       9201        No. of FTE                .......  .......  .......
       9202        Budget Authority          .......  .......  .......
                                            ----------------------------
                     Total, all reporting
                      entities:
       9401              No. of FTE          .......  .......  .......
       9402              Budget Authority    .......        1        1
       9998        Robert M. Darragh III     .......  .......  .......
       9999        (202) 720-0994            .......  .......  .......
 
             Part 1. Data on IT Systems By
                   Mission Area (7)
 
               Mission Area 1: Financial
                Management Major IT:
    0110-10        FNS Agency Financial      .......  .......  .......
                    Management System
    0110-11        Development/              .......  .......  .......
                    modernization/
                    enhancement
    0110-12        Steady State                    4        4        4
                                            ----------------------------
    0110-13          Subtotal, IT costs            4        4        4
               Appropriation/Funding
                Sources:
 0110-14 01        FNS appropriations              4        4        4
                                            ----------------------------
    0110-17          Subtotal, funding             4        4        4
                      sources
    0110-20        FS Central Accounting     .......  .......  .......
                    System
    0110-21        Development/              .......  .......  .......
                    modernization/
                    enhancement
    0110-22        Steady State                    2        2        2
                                            ----------------------------
    0110-23          Subtotal, IT costs      .......  .......  .......
               Appropriation/Funding
                Sources:
 0110-24 01        FNS appropriations              2        2        3
                                            ----------------------------
    0110-27          Subtotal, funding             2        2        3
                      sources
    0110-30        FS Central Accounting     .......  .......  .......
                    System
    0110-31        Development/                   30       36       34
                    modernization/
                    enhancement
    0110-32        Steady State                    3        3        4
                                            ----------------------------
    0110-33          Subtotal, IT costs           33       39       38
               Appropriation/Funding
                Sources:
 0110-34 01        FS Appropriations              33       39       38
                                            ----------------------------
    0110-37          Subtotal, funding            33       39       38
                      sources
    0110-40        FS Integrated Personnel   .......  .......  .......
                    System
    0110-41        Development/                    5        6        6
                    modernization/
                    ehancement
    0110-42        Steady State              .......  .......  .......
                                            ----------------------------
    011O-43          Subtotal, IT costs            5        6        6
               Appropriation/Funding
                Sources:
    0110-01        FS Appropriations               5        6        6
                                            ----------------------------
    0110-47          Subtotal, funding             5        6        6
                      sources
    0110-5O        FSA CORE                  .......  .......  .......
    0110-51        Development/                    3        2  .......
                    modernization/
                    enhancement
    0110-52        Steady State                    1        1        1
                                            ----------------------------
    0110-53          Subtotal, IT costs            4        3        2
               Appropriation/Funding
                Sources:
 0110-54 01        CCC                             1        1        1
 0110-54 02        FSA Appropriation               3        2  .......
                                            ----------------------------
    0110-57          Subtotal, funding             4        3  .......
                      sources
    0110-60    NRCS Financial Management
                Information System-Legacy:
    0110-61        Development/              .......  .......  .......
                    modernization/
                    enhancement
    0110-62        Steady State                    6        6        6
                                            ----------------------------
    0110-63          Subtotal, IT costs            6        6        6
               Appropriation/Funding
                Sources:
 0110-64 01        NRCS Appropriation              6        6        6
                                            ----------------------------
    0110-67          Subtotal, fundinq             6        6        6
                      sources
               All Other Financial
                Management:
    0120-01        Development/                   11       14       12
                    modernization/
                    enhancement.
    0120-02        Steady State                   29       30       31
                                            ----------------------------
    0120-03          Subtotal, IT costs           40       44       43
               Appropriation/Funding
                Sources:
 0120-04 01        FS Appropriation                5        5        5
 0120-04 02        USDA Agencies                  32       34       38
                    Approprations
 0120-04 03        CCC                             3        5  .......
                                            ----------------------------
    0120-07          Subtotal, funding            40       44       43
                      sources
                     Total: Mission Area:
    0130-01              Development/             49       58       52
                          modernization/
                          enhancement
    0130-02              Steacy State             45       46       49
                                            ----------------------------
    0130-03          Subtotal, IT costs           94      104      101
               Other Mission Areas:
                   Mission Area 2: USDA      .......  .......  .......
                    Program and
                    Administrative Support
                    Systems
               Major IT:
    1110-10        FNS Food Stamp            .......  .......  .......
                    Integrated Information
                    System
    1110-11        Development/              .......  .......  .......
                    modernization/
                    enhancement
    1110-12        Steady State                    3        4        4
                                            ----------------------------
    1110-13          Subtotal, IT costs            3        4        4
               Appropriation/Funding
                Sources:
 1110-14 01        FNS appropriations              3        4        4
                                            ----------------------------
    1110-17          Subtotal, funding             3        4        4
    1110-20        Processed Commodities     .......  .......  .......
                    Inventory Management
                    System
    1110-21        Development/                    1        1        4
                    modernization/
                    enhancement
    1110-22        Steady State                    8        8        8
                                            ----------------------------
    1110-23          Subtotal, IT costs            9        9       12
               Appropration/Funding
                Sources:
 1110-24 01        AMS Appropriation               1        1        3
 1110-24 02        FSA Appropriation               2        2        2
 1110-24 03        CCC                             2        2        2
 1110-24 04        FNS appropriations              4        4        5
                                            ----------------------------
    1110-27          Subtotal, funding             9        9       12
                      sources
    1110-30        FMS Electronic Benefit    .......  .......  .......
                    Transfer
    1110-31        Development/              .......  .......  .......
                    modernization/
                    enhancement
    1110-32        Steady State                   43       43       43
                                            ----------------------------
    1110-33          Subtotal, IT costs           43       43       43
               Appropriation/Funding
                Sources:
 1110-23 01        FNS appropriations             43       43       43
                                            ----------------------------
    1110-37          Subtotal, funding            43       43       43
                      sources
    1110-40        FSIS Field Automation &   .......  .......  .......
                    Information Management
    1110-41        Development/                    8       12       12
                    modernization/
                    enhancement
    1110-42        Steady State              .......  .......  .......
                                            ----------------------------
    1110-43          Subtotal, IT costs            8       12       12
               Appropriation/Funding
                Sources:
 1110-44 01        FSIS Appropriation              8       12       12
                                            ----------------------------
    1110-47          Subtotal, funding             8       12       12
                      sources
    1110-50        APHIS Integrated Systems  .......  .......  .......
                    Acquisition Project
    1110-51        Development/              .......  .......  .......
                    modernization/
                    enhancement
    1110-52        Steady State                   10        6        9
                                            ----------------------------
    1110-53          Subtotal, IT costs           10        6        9
               Appropriation/Funding
                Sources:
 1110-54 01        APHIS Appropriation            10        6        9
                                            ----------------------------
    1110-57          Subtotal, funding            10        6        9
                      sources
    1110-60        FS Integrated Personnel   .......  .......  .......
                    System
    1110-61        Development/                    5        6        6
                    modernization/
                    enhancement
    1110-62        Steady State              .......  .......  .......
                                            ----------------------------
    1110-63          Subtotal, IT costs            5        6        6
               Appropriation/Funding
                Sources:
 1110-64 01        FS Appropriations               5        6        6
                                            ----------------------------
    1110-67          Subtotal, funding             5        6        6
                      sources
    1110-70        Service Center            .......  .......  .......
    1110-71        Development/                   90       50       90
                    modernization/
                    enhancement
    1110-72        Steady State              .......  .......  .......
                                            ----------------------------
    1110-73          Subtotal, IT costs           90       50       90
               Appropriation/Funding
                Sources:
 1110-74 01        RD Appropriation                6        8  .......
 1110-74 02        CCC                            49       10       16
 1110-74 03        FSA Appropriation               4        1  .......
 1110-74 04        Service Bureau            .......  .......       74
                    Appropriation
 1110-75 05        NRCS Appropriation             31       31  .......
                                            ----------------------------
    1110-77          Subtotal, funding            90       50       90
                      sources
    1110-80        RD Dedicated Loan               1        1        1
                    Origination System
    1110-81        Development/                    1        1        1
                    modernization/
                    enhancement
    1110-82        Steady State                    4        4        4
                                            ----------------------------
    1110-83          Subtotal, IT costs            5        5        5
               Appropriation/Funding
                Sources:
 1110-84 01        RD Appropriations               5        5        5
                                            ----------------------------
    1110-87          Subtotal, funding             5        5        5
                      sources
    1110-90        NRCS Administrative       .......  .......  .......
                    Support and Records
                    Management/MSIS
    1110-91        Development/              .......  .......  .......
                    modernization/
                    enhancement
    1110-92        Steady State                    1        1        1
                                            ----------------------------
    1110-93          Subtotal, IT costs            1        1        1
               Appropriation/Funding
                Sources:
 1110-94 01        NRCS Appropriations             1        1        1
                                            ----------------------------
    1110-97          Subtotal, funding             1        1        1
                      sources
              All other for Mission Area
 
    1120-01        Development/                   75       95       94
                    modernization/
                    enhancement.
    1120-02        Steady State                  406      413      413
                                            ----------------------------
    1120-03          Subtotal, IT costs          481      508      507
               Appropriation/Funding
                Sources:
 1120-04 01        FCIC Revolving Fund       .......        2        2
 1120-04 02        Other USDA Agency             420      429      442
                    Appropriations
    1120-03        GIPSA Trust                     2        2        1
 1120-04 04        CCC                            18       21       18
 1120-04 05        FS Appropriation               41       54       44
                                            ----------------------------
    1120-07          Subtotal, funding           481      508      507
                      sources
                     Total: Mission Area
    1130-01              Development/            180      165      207
                          modernization/
                          enhancement.
    1130-02              Steady State            475      479      482
                                            ----------------------------
    1130-03          Subtotal, IT costs          655      644      689
               All Mission Areas:
    9930-01        Development/                  229      223      259
                    modernization/
                    enhancement
    9930-02        Steady State                  520      525      531
                                            ----------------------------
    9930-03          Subtotal, IT costs          749      748      790
 
            Part 2. Data on Infrastructure
               and Office Automation (8)
 
               Major IT Infrastructure
                System:
    01-1010        FS Project 615            .......  .......  .......
    01-1011        Development/                   85       68       31
                    modernization/
                    enhancement
    01-1012        Steady State                   28       32       71
                                            ----------------------------
    01-1013          Subtotal, IT costs          113      100      102
               Appropriation/Funding
                Sources:
0-1-1014 01        FS Appropriations             113      100      102
                                            ----------------------------
   -01-1017        Subtotal, funding             113      100      102
                    sources
    01-1020        FSA SCOAP                 .......  .......  .......
    01-1021        Development/              .......        1  .......
                    modernization/
                    enhancement
    01-1022        Steady State                    9       10        8
                                            ----------------------------
    01-1023          Subtotal, IT costs            9       11        8
               Appropriation/Funding
                Sources:
 01-1024 01        CCC                             9       11        8
 01-1024 02        FSA Appropriation         .......  .......  .......
                                            ----------------------------
    01-1027          Subtotal, funding             9       11        8
                      sources
               Other Infrastructure System:
    01-2001        Development/                   89      105       88
                    modernization/
                    enhancement
    01-2002        Steady State                  216      234      222
                                            ----------------------------
    01-2003          Subtotal, IT costs          305      339      310
               Appropriation/Funding
                Sources:
 01-2004 01        CCC                            11       20        1
 01-2004 02        FS Appropriation              106      108       99
 01-2004 03        USDA Agencies                 188      211      210
                    Appropriation
                                            ----------------------------
    01-2007          Subtotal, funding           305      339      310
                      sources
                                            ----------------------------
               All Infrastructure System:
    99-3001          Total Development/          174      174      119
                      modernization/
                      enhancement
                                            ============================
    99-3002          Total Steady State          253      276      301
                                            ============================
    99-3303          Total, All                  427      450      420
                      Infrastructure
                      Systems
 
            Part 3. Data on IT Architecture
                   and Planning (9)
 
               Other IT Architecture and
                Planning:
    01-2001        Development/              .......  .......        1
                    modernization/
                    enhancement
    01-2002        Steady State              .......  .......  .......
                                            ----------------------------
    01-2003          Subtotal, IT costs      .......  .......        1
               Appropriation/Funding
                Sources:
 01-2004 01        USDA Agency               .......  .......        1
                    Appropriations
                                            ----------------------------
    01-2007          Subtotal, funding       .......  .......        1
                      sources
                                            ----------------------------
               All IT Architecture and
                Planning:
    99-3001          Total Development/      .......  .......        1
                      modernization/
                      enhancement
                                            ----------------------------
    99-3002          Total Steady State      .......  .......  .......
                                            ============================
    99-3003          Total, All IT           .......  .......        1
                      Architecture
 
           Part 4. IT Resources Summary (0)
 
               Mission Area,
                Infrastructure, and
                Architecture Totals:
    99-3001        Development/              .......  .......  .......
                    modernization/
                    enhancement
    99-3002        Steady State                  773      801      832
                                            ============================
    99-3003          Total, All IT costs       1,176    1,198    1,211
------------------------------------------------------------------------

    Question. Of the total planned expenditures, how much does the 
Department expect to spend for (1) new hardware and software purchases 
by agency and by computer system, and (2) IT personnel by component 
agency and by staff office?
    Answer. As reflected in the OMB Exhibit 42 report submitted in 
January, 1999, USDA has requested budget authority for IT of just over 
$1.2 billion. Specific information on the expenditures for hardware and 
software are no longer reported. According to the last Exhibit 43 
report, prepared in the fall of 1998 for budget year 2000, the 
estimated expenditures for equipment in fiscal year 2000 are $224 
million, and the estimated expenditures for software in fiscal year 
2000 are $66 million.
    According to the estimate prepared in August of 1998, 4,816 FTEs 
from all of USDA's agencies and staff offices were to be devoted to 
information technology activities for fiscal year 2000. The 
composition, by agency or office, follows:

            USDA IT PERSONNEL BY COMPONENT AGENCY AND OFFICE
                         [Dollars in thousands]
------------------------------------------------------------------------
                 Agency                      Personnel          FTE
------------------------------------------------------------------------
AMS.....................................          $2,951           72.00
ARS.....................................          16,127          225.50
APHIS...................................          13,332          202.00
CSREES..................................           2,053           24.50
DA......................................           1,931           25.75
ERS.....................................           4,355           50.00
FSA.....................................          45,671          683.00
FNS.....................................          10,517          158.56
FSIS....................................           4,501           72.00
FS                                                84,689         1443.19
GIPSA...................................           2,016           27.50
NASS....................................           7,058          142.00
NRCS....................................          25,308          414.00
OBPA....................................             315            4.40
OC......................................             264            5.00
OCE.....................................             567            4.50
OCFO....................................          26,452          604.00
OCIO....................................          24,287          314.33
OIG.....................................           1,179           23.00
OGC.....................................             229            3.00
RMA.....................................           3,935           58.80
RD......................................          14,763          259.00
                                         -------------------------------
    TOTAL...............................         292,500        4,816.03
------------------------------------------------------------------------

              information technology contractor assistance
    Question. To what extent does USDA rely on contractor assistance to 
carry out its IT responsibilities? Please list all ongoing IT 
contracts, the amount of the contract award, and the contractor's scope 
of work.
    Answer. During fiscal year 1998, there were 1,191 active contracts 
for ADP-related support services, as defined by the Office of Federal 
Procurement Policy. These contracts totaled approximately $259 million. 
In fiscal year 1999, there are 548 active contracts for ADP-related 
support services, totaling approximately $117 million.
    For a full list of active IT service contracts, please see the 
attached document ``IT support Service Contracts Active in Fiscal Year 
1999''.
    [The information follows:]

                             IT SUPPORT SERVICE CONTRACTS ACTIVE IN FISCAL YEAR 1999
----------------------------------------------------------------------------------------------------------------
                                                          Service                                        Number
              Reporting agency/description                 Code     Obligated     Action   Completion      of
                                                           ``D''      amount       date       date      actions
----------------------------------------------------------------------------------------------------------------
APHIS:
    DADP ACQUISITION SUP SVCS..........................       314     $156,207    1993/09     2004/08          1
    ADP FACILITY MANAGEMENT............................       301       78,780    1997/06     1998/12          1
    ADP PROGRAMMING SVCS...............................       308      369,154    1998/08     1999/03          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      975,000    1998/09     1999/03          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316        2,208    1998/09     1999/01          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316        2,018    l999/11     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316        2,345    1998/09     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       18,674    1998/11     1999/09          2
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       77,583    1998/12     1999/09          5
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       26,381    1998/10     1999/09         15
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........    1,708,348  .........  ..........         29
                                                        ========================================================
ARS:
    ADP ACQUISITION SUP SVCS...........................       314       13,000    1998/09     1999/09          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       48,000    1999/01     1999/09          1
    ADP SYSTEM ANALYSIS................................       306      105,000    1998/09     1999/08          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       27,000    1998/09     1998/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      200,000    1996/09      200109          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        2,000    1997/10     2001/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       15,000    1997/11     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       14,345    1999/01     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316        1,189    1998/09     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       23,966    1998/08     1999/02          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      339,340    1998/04     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       10,656    1999/02     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       22,599    1999/02     1999/02          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      171,092    1998/12     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       30,055    1998/10      200109          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399     -172,000    1998/10     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       16,252    1998/10     1998/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      198,000    1998/06     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      197,000    1998/04     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       13,000    1996/10     1999/09          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      650,000    1998/09     1999/09          1
    AUTO NEWS, DATA & OTHER SVCS.......................       317      424,410    1998/11     2003/12          1
    AUTO NEWS, DATA & OTHER SVCS.......................       317       25,000    1998/03     1998/12          1
    AUTO NEWS, DATA & OTHER SVCS.......................       317      550,000    1998/10     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      141,063    1998/10     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       28,000    1997/11     2001/09          2
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       72,000    1998/09     1999/02          3
    AUTO NEWS, DATA & OTHER SVCS.......................       317      235,000    1998/09     1999/09          4
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      164,998    1998/10     l999/09         14
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........    3,565,965  .........  ..........         50
                                                        ========================================================
FAS: OTHER ADP & TELECOMMUNICATIONS SVCS...............       399       40,280    1994/09     1999/09          1
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........       40,280  .........  ..........          1
                                                        ========================================================
FCS:
    ADP FACILITY MANAGEMENT............................       301       20,160    1999/02     1999/04          1
    ADP INF, BROADCAST & DIST SVCS.....................       309      150,000    1996/11     1999/09          1
    ADP SVCS/DATA ENTRY................................       303      134,306    1998/07     1999/09          1
    ADP SYSTEM ANALYSIS................................       306      301,619    1998/10     1999/09          1
    ADP SYSTEMS DEVELOP................................       302    1,412,582    1998/07     1999/08          1
    ADP SYSTEMS DEVELOP................................       302       73,105    1998/09     1999/04          1
    ADP SYSTEMS DEVELOP................................       302      427,996    1998/09     1999/02          1
    OTHER ADP & TELECOMMUICATIONS SVCS.................       399      125,070    1998/09     1999/06          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      139,878    1998/09     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       31,812    1998/09     1999/02          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       89,417    1998/06     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      209,914    1998/04     1999/05          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       37,088    1998/02     1998/10          1
    ADP SYSTEMS DEVELOP................................       302       -6,520    1998/11     1998/11          1
    ADP SYSTEMS DEVELOP................................       302      317,120    1998/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399          606    1998/12     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       93,182    1998/09     1999/08          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    1,086,767    1998/09     1999/07          1
    ADP SYSTEMS DEVELOP................................       302      892,921    1998/07     1999/07          1
    ADP INF, BROADCAST & DIST SVCS.....................       309       99,994    1998/05     1999/09          1
    ADP INF, BROADCAST & DIST SVCS.....................       309      200,000    1996/05     1999/09          1
    ADP INF, BROADCAST & DIST SVCS.....................       309      200,000    1995/09     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       53,925    1998/10     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      765,558    1998/08     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      490,692    1998/09     1999/09          2
    ADP SYSTEM ANALYSIS................................       306      190,288    1998/09     1999/09          3
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    1,753,350    l998/10     1999/09          4
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........    9,290,830  .........  ..........          4
                                                        ========================================================
FS:
    ADP FACILITY MANAGEMENT............................       301        7,000    1998/02     1998/10          1
    ADP PROGRAMMING SVCS...............................       308       32,000    1998/06     1998/11          1
    ADP PROGRAMMING SVCS...............................       308      100,000    1999/02     2000/04          1
    ADP SYSTEMS DEVELOP................................       302       57,428    1997/08     1998/12          1
    ADP PROGRAMMING SVCS...............................       308       40,471    1998/01     1998/31          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      425,000    1998/05     1998/12          1
    ADP SYSTEMS DEVELOP................................       302       46,840    1999/02     1999/10          1
    ADP SYSTEMS DEVELOP................................       302       25,185    1999/02     1999/09          1
    ADP SYSTEMS DEVELOP................................       302        9,945    1999/02     1999/04          1
    ADP SYSTEMS DEVELOP................................       302       72,000    1998/09     2001/09          1
    ADP SYSTEMS DEVELOP................................       302       43,000    1998/09     1999/12          1
    ADP SYSTEMS DEVELOP................................       302      359,000    1998/09     1999/09          1
    ADP SYSTEMS DEVELOP................................       302       11,000    1998/09     1999/08          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        2,054    1998/09     1998/11          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        2,176    1998/07     1999/07          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       54,168    1998/07     1999/06          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       27,432    1998/02     1999/01          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       -2,171    1997/12     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       11,997    1997/04     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      430,870    1993/12     1998/12          1
    DIGITIZING SVCS....................................       315        8,122    1998/09     1999/07          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       62,975    1998/12     1999/06          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       44,653    1998/12     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       21,200    1998/11     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399          758    1998/11     1998/11          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        5,040    1998/10     1998/11          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       63,175    1998/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       36,080    1998/09     1999/08          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       30,373    1998/09     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       96,002    1999/01     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        9,277    1999/01     1999/02          1
    DIGITIZING SVCS....................................       315       10,600    1998/09     1999/01          1
    DIGITIZING SVCS....................................       315       20,000    1998/08     1999/07          1
    DIGITIZING SVCS....................................       315       10,900    1998/07     1999/02          1
    DIGITIZING SVCS....................................       315      100,000    1998/05     1999/07          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       56,126    1998/10     1998/12          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      -36,S57    1998/10     1998/10          1
    AUTOMATED INFORMATIOK SYSTEM SVCS..................       307     -168,000    1998/09     1998/10          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       56,126    1998/08     1998/12          1
    ADP SYSTEMS DEVELOP................................       302       10,000    1998/09     1999/02          1
    ADP SYSTEMS DEVELOP................................       302       20,000    1998/08     1999/04          1
    ADP SYSTEMS DEVELOP................................       302        5,000    1998/08     1999/02          1
    ADP SYSTEMS DEVELOP................................       302        6,000    1998/08     1998/11          1
    ADP SYSTEMS DEVELOP................................       302        1,271    1998/08     1998/10          1
    ADP SYSTEMS DEVELOP................................       302       30,000    l998/04     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       67,253    1998/09     1999/09          1
    ADP FACILITY MANAGEMENT............................       301        2,781    1998/10     1999/06          1
    ADP INF, BROADCAST & DIST SVCS.....................       309       40,000    1998/10     1999/09          2
    ADP SYSTEMS DEVELOP................................       302    2,284,000    1995/09     1999/04          2
    ADP PROGRAMMING SVCS...............................       308        2,000    1998/10     2000/10          2
    ADP SYSTEMS DEVELOP................................       302       13,000    1998/08     1998/12          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      154,521    1997/09     1998/10          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       35,429    1996/12     1998/12  .........
    ADP SYSTEMS DEVELOP................................       302       28,000    1998/08     1999/05          2
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       12,000    1997/11     1998/11          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       97,839    1998/10     1999/03          3
    ADP SYSTEllS DEVELOP...............................       302       35,000    1998/08     1999/03          4
    AUTOMATED INFORMATION SYSTEM SVCS..................       307        2,000    1998/08     2000/08          4
    ADP FACILITY MANAGEMENT............................       301       73,000    1998/01     1998/10          6
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       51,481    1997/09     1998/12          6
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       16,641    1998/09     1998/10          6
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........    5,169,365  .........  ..........         92
                                                        ========================================================
FSA:
    ADP DATA CONVERSION SVCS...........................       311      962,000    1997/12     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       70,000    1999/10     1999/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    7,137,988    1999/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    7,900,000    1998/10      2002C9          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      118,446    1998/10     1999/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    1,995,000    1998/10     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      216,000    1998/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      664,160    1998/04     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       23,120    1998/02     1999/09          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      349,558    1999/09     1999/09          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      304,983    1998/05     1999/09          1
    ADP FACILITY MANAGEMENT............................       301    2,931,911    1999/02     2000/01          1
    ADP FACILITY MANAGEMENT............................       301       20,000    1999/02     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       50,170    1999/02     1999/03          1
    ADP FACILITY MANAGEMENT............................       301       50,170    1999/01     1999/05          1
    ADP FACILITY MANAGEMENT............................       301      475,074    1998/11     1999/10          1
    ADP FACILITY MANAGEMENT............................       301      189,808    1993/11     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       10,000    1996/02     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    2,624,810    1996/01     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       60,000    1995/12     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    4,416,608    1995/10     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      260,000    1995/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       47,000    1995/04     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      198,000    1995/02     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    2,690,510    1995/01     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    2,745,324    1998/02     1999/01          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    8,026,000    1997/10     2002/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      130,000    1997/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       11,000    1997/07     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       58,000    1997/05     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      -26,000    1997/03     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       31,000    1996/07     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      103,000    1996/05     1999/09          1
    ADP FACILITY MANAGEMENT............................       301      406,657    1998/10     1999/10          1
    ADP FACILITY MANAGEMENT............................       301        5,000    1998/09     1999/10          1
    ADP FACILITY MANAGEMENT............................       301      156,509    1998/06     1999/09          1
    ADP FACILITY MANAGEMENT............................       301      312,759    1998/06     1999/03          1
    ADP FACILITY MANAGEMENT............................       301      583,760    1997/10     1998/10          1
    ADP DATA CONVERSION SVCS...........................       311      168,000    1998/10     1999/09          1
    ADP DATA CONVERSION SVCS...........................       311      100,000    1998/10     1998/12          1
    ADP DATA CONVERSION SVCS...........................       311      150,000    1998/09     1999/12          1
    ADP DATA CONVERSION SVCS...........................       311       30,000    1998/09     1998/10          1
    ADP DATA CONVERSION SVCS...........................       311      550,000    1998/12     1999/03          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      258,000    1998/10     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      341,000    1997/01     1999/09          2
    ADP DATA CONVERSION SVCS...........................       311      365,000    1999/01     1999/03          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      207,366    1999/10     1999/10          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    5,494,091    1997/10     1999/09          2
    ADP DATA CONVERSION SVCS...........................       311      650,000    1998/09     1998/12          3
    ADP FACILITY MANAGEMENT............................       301      646,934    1998/09     1999/03          3
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399     -739,000    1996/09     1999/09          4
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    4,852,700    1996/10     1999/09          4
    ADP FACILITY MANAGEMENT............................       301    2,330,178    1998/09     1999/09          8
    ADP FACILITY MANAGEMENT............................       301    5,139,866    1998/10     1999/09         11
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........   66,852,458  .........  ..........         87
                                                        ========================================================
FSIS:
    ADP SYSTEMS DEVELOP................................       302       95,641    1997/06     2009/10          1
    ADP SYSTEMS DEVELOP................................       302      199,744    1998/07     1999/01          1
    ADP SYSTEMS DEVELOP................................       302       50,760    1998/10     1999/09          1
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      139,097    1999/03     1999/04          1
    ADP FACILITY MANAGEMENT............................       301      165,050    1998/10     1999/09          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       15,446    1999/01     1999/03          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307       22,739    1998/10     1998/11          2
    AUTOMATED INFORMATION SYSTEM SVCS..................       307        4,484    1998/12     1998/12          3
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      126,377    1998/10     1998/10          4
    AUTOMATED INFORMATION' SYSTEM SVCS.................       307       28,253    1998/11     1998/12          4
    AUTOMATED INFORMATION SYSTRM SVCS..................       307      279,434    1998/12     1999/01          8
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      652,359    1999/01     1999/02         11
    AUTOMATED INFORMATION SYSTEM SVCS..................       307      548,182    1999/02     1999/03         11
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........    2,327,567  .........  ..........         51
                                                        ========================================================
NRCS:
    ADP SYSTEMS DEVELOP................................       302      135,240    1997/09     1999/09          1
    ADP SYSTEMS DEVELOP................................       302       99,612    1998/05     2001/09          1
    ADP SYSTEMS DEVELOP................................       302      215,632    1998/08     2001/09          1
    ADP SYSTEMS DEVELOP................................       302      499,955    1999/02     1999/09          1
    ADP SYSTEMS DEVELOP................................       302       -5,000    1998/08     1999/09          1
    ADP SYSTEMS DEVELOP................................       302      544,920    1997/12     1999/09          1
    ADP SYSTEIS DEVELOP................................       302      255,000    1997/09     2001/09          1
    ADP SYSTEIS DEVELOP................................       302      167,049    1998/06     1999/09          2
    ADP SYSTEMS DEVELOP................................       302      367,431    1998/10     1999/09          2
    ADP SYSTEMS DEVELOP................................       302      289,554    1998/04     1999/09          3
    ADP SYSTEMS DEVELOP................................       302       24,814    1998/05     1999/09          3
    ADP SYSTEMS DEVELOP................................       302      418,904    1997/07     2001/09          4
    ADP SYSTEMS DEVELOP................................       302      643,988    1997/12     2001/09          4
    ADP SYSTEMS DEVELOP................................       302    1,679,840    1998/12     1999/09          4
    ADP SYSTEMS DEVELOP................................       302    1,316,498    1998/11     1999/09          5
    ADP SYSTEMS DEVELOP................................       302      383,953    1999/01     1999/09          5
    ADP SYSTEMS DEVELOP................................       302    2,635,896    1998/01     1999/09          6
    ADP SYSTEMS DEVELOP................................       302      540,571    1998/03     1999/09          7
    ADP SYSTEMS DEVELOP................................       302      239,221    1998/07     1999/09          7
    ADP SYSTEMS DEVELOP................................       302    1,316,270    1998/09     1999/09         11
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........   11,769,346  .........  ..........         70
                                                        ========================================================
OFM:
    ADP SYSTEM ANALYSIS................................       306      122,067    1998/10     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       45,363    1998/10     1999/09          1
    ADP SYSTEM ANALYSIS................................       306      184,982    1998/10     1999/09          2
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........      352,412  .........  ..........          4
                                                        ========================================================
OIG:
    OTHER ADP & TELECOMFUNICAIIONS SVCS................       399        1,000    1987/10     1998/10          1
    OTHER ADP & TELECOMPUNICATIONS SVCS................       399        4,000    1998/12     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399        5,000    1998/11     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       14,000    1998/10     1999/09          3
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........       24,000  .........  ..........          6
                                                        ========================================================
OO:
    ADP FACILITY MANAGEMENT............................       301      160,930    1995/09     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       20,000    1999/02     1999/09          1
    ADP INF, BROADCAST & DIST SVCS.....................       309      147,596    1997/12     1999/03          1
    ADP INF, BROADCAST & DIST SVCS.....................       309       19,000    1393/01     1999/01          1
    ADP PROGRAMMING SVCS...............................       308      832,796    1095/10     1999/09          1
    ADP PROGRAMMING SVCS...............................       308      191,785    1995/04     1999/09          1
    TELECOMMUJICATION NETWORK MGMT SVCS................       316      159,162    1998/02     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      -26,869    1997/10     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      118,825    1997/09     1998/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       26,596    1999/02     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      187,500    1999/01     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      127,461    1998/12     2003/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    3,493,000    1998/12     1999/10          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      -39,235    1998/12     1998/12          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      480,338    1999/01     1999/09          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316       11,587    1999/01     1999/02          1
    TEkECOMMUNICATION NETWORK MGMT SVCS................       316        5,762    1999/01     1999/01          1
    TELECOMMUNICATION NETWORK MGMT SVCS................       316      414,590    1998/12     1999/09          1
    ADP TELEPROCESSING & TIMESHARE.....................       305       16,000    1998/10     1998/10          1
    ADP SYSTEMS DEVELOP................................       302      360,535    1998/05     1998/12          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       25,000    1999/02     1999/03          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       25,000    1998/11     1999/02          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304      192,780    1998/09     1999/09          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       62,802    1997/10     2008/09          1
    ADP PROGRAMMING SVCS...............................       308       70,120    1998/02     1999/12          1
    ADP INF, BROADCAST & DIST SVCS.....................       309       27,500    1998/11     1998/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       35,977    1998/11     1998/12          1
    ADP TELEPROCESSING & TIMESHARE.....................       305      175,000    1999/01     1999/03          1
    ADP TELEPROCESSING & TIMESHARE.....................       305       25,000    1993/11     1999/03          1
    ADP INF, BROADCAST & DIST SVCS.....................       309      172,380    l997/10     1999/03          1
    ADP FACILITY MANAGEMENT............................       301      959,839    1998/12     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       13,824    1996/01     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       29,724    1998/09     1999/10          1
    ADP FACILITY MANAGEMENT............................       301      929,479    1995/11     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       52,999    1999/02     2003/09          2
    ADP SVCS/DATA ENTRY................................       303    2,067,672    1998/09     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    1,059,450    1998/09     1998/12          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      286,770    1998/09     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      236,000    1998/11     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       63,982    1998/09     1998/10          2
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       51/000    1998/12     1999/02          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    5,947,608    1998/10     1999/09          4
    TELECOMMUNICATION NETWORK MGMT SVCS................       316    1,887,176    1999/02     1999/09          4
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........   21,104,442  .........  ..........         57
                                                        ========================================================
RD:
    ADP DATA CONVERSION SVCS...........................       311       33,333    1999/02     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       78/000    1998/06     1999/05          1
    ADP FACILITY MANAGEMENT............................       301       30,276    1998/12     1999/09          1
    ADP PROGRAMMING SVCS...............................       308      212,382    1998/09     1999/05          1
    ADP SYSTEM ANALYSIS................................       306       83,336    1998/08     1999/08          1
    ADP SYSTEMS DEVELOP................................       302      599,965    1998/08     1999/08          1
    OTHER ADP & TELECOMMlICATIONS SVCS.................       399        5,001    1994/09     1999/09          1
    ADP SYSTEMS DEVELOP................................       302      192,750    1999/02     1999/08          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       47,808    1998/12     2000/01          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      159,664    1998/11     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    6,675,000    1998/09     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      423,131    1998/08     1999/09          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      347,748    1998/08     1999/08          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       82,815    1998/07     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       39,224    1998/03     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      110,288    1998/01     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       40,000    1999/02     2000/02          1
    ER ADP & TELECOMMUNICATICNS SVCS...................       399      167,072    1999/02     1999/04          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       43,434    1999/01     1999/03          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       36,000    1997/11     1999/02          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    5,939,000    1997/04     1999/05          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399      593,000    1996/11     1999/05          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       89,000    1996/02     1999/05          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    5,252,000    1995/10     1999/05          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    7,274,730    1995/09     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    7,182,000    1995/05     1999/12          1
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399       50,960    1995/02     1999/09          1
    ADP SVCS/TELECOMM & TRANSMISSION...................       304       34,409    1998/12     1999/09          1
    ADP OPTICAL SCANNING SVCS..........................       312      210,000    1998/09     1999/09          1
    ADP FACILITY MANAGEMFNT............................       301       11,500    1998/11     1999/09          1
    ADP FACILITY MANAGEMENT............................       301       34,655    1998/09     1999/08          1
    ADP SYSTEMS DEVELOP................................       302      519,206    1998/09     1999/09          2
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    1,121,880    1996/10     1999/12          2
    ADP FACILITY MANAGEMENT............................       301      704,914    1998/10     1999/09          3
    OTHER ADP & TELECOMMUNICATIONS SVCS................       399    2,612,604    1998/10     1999/09          4
                                                        --------------------------------------------------------
      SUBTOTAL.........................................  ........   41,037,086  .........  ..........         42
                                                        ========================================================
      TOTAL............................................  ........  163,242,099  .........  ..........        524
----------------------------------------------------------------------------------------------------------------

    Question. Did USDA's Executive Information Technology Investment 
Review Board approve the Department's fiscal year 2000 IT budget/IT 
systems proposals? If so, when and what were the results? (Identify any 
IT systems proposals that were not approved for funding and their 
dollar amount).
    Answer. The Executive Information Technology Investment Review 
Board--EITIRB--considered and approved the USDA information technology 
portfolio of investments for fiscal year 2000 as part of the investment 
review process in the fiscal year 2000 budget process. The Board 
focused on the major information technology--IT initiatives within the 
Department, the totality of the investment, and the strategic issues 
that derive from this level of investment. USDA major technology 
initiatives include the Foundation Financial Information System, the 
Service Center Modernization Initiative, Rural Development's Dedicated 
Loan Origination System, the Forest Service's Project 615, and the Food 
and Nutrition Service's Electronic Benefits Transfer program.
    In addition to approving the USDA IT portfolio, the EITIRB 
discussed key IT issues and challenges which affect all agencies 
including: the Department's Year 2000 compliance efforts, management of 
the Department's telecommunications network, USDA Continuity of 
Operations Plans, the increased use of independent verification and 
validation, and the USDA moratorium on all new IT purchases that do not 
directly support the Department's Year 2000 compliance work.
    Prior to the formulation of the Department's IT portfolio, USDA's 
Agency IRM Review Boards review IT initiatives and decide whether to 
continue, modify, or stop a project or system sponsored by the agency. 
These surviving IT projects or systems then become part of the draft 
Department IT portfolio where it is reviewed by OCIO staff and approved 
by the EITIRB.
                           clinger-cohen act
    Under the Clinger-Cohen Act of 1996, departments and agencies were 
to establish a Capital Planning and Investment Control (CPIC) process 
and an information systems technology architecture to guide IT 
investment decisions.
 usda capital planning and information systems technology architecture
    Question. Where does the Department of Agriculture stand with 
respect to fully instituting a CPIC process and implementing an overall 
information systems technology architecture? What work remains and what 
are the time frames and milestones for completing it?
    Answer. During fiscal year 1999, the OCIO capital planning 
performance plan goal was to have 10 agencies using the Capital 
Planning and Investment Control Process. For fiscal year 2000, the goal 
stated was 20 agencies using capital planning. We now have 15 agencies 
using capital planning, and hope that by the fiscal year 2001 budget 
cycle, which begins in July, all of our agencies and staff offices will 
be using capital planning to manage their IT investments. Further, USDA 
plans to use I-TIPS, an information technology capital planning support 
system, to produce reports for OMB, including Circular A-11 Exhibit 42 
and xhibit 300. Additional resources requested in the President's 
budget would be used to hire and train skilled staff to perform and 
review benefit-cost, return on investment, and other detailed analyses 
in order to reduce as far as practical the risk of failure in the 
development, deployment, and operation of USDA information technology 
systems.
    During fiscal year 2000, integration of the USDA Information 
Systems Technology Architecture--ISTA--into the capital planning 
process will continue to ensure the interoperability of future 
information technology investments across program areas and further 
breakdown existing ``stovepipes'' within the Department. We will use 
the principles and standards of the architecture process to evaluate 
investments and ensure the best use of our scarce resources.
    USDA is revising Version 1 of the Information Systems Technology 
Architecture. The next version will be published in the summer of 1999. 
This effort is refocusing the architecture to align with the Federal 
Architecture Model, which prescribes a segment approach for addressing 
diverse organizations such as the Federal government and USDA. Major 
segments represent business areas such as grants, finance, ecosystems 
management, etc. Organizing by segments allows critical parts of the 
architecture to be developed individually, while also providing a 
mechanism for integrating the architecture segments into the larger 
enterprise architecture. Examples of USDA segments include: the 
Foundation Financial Information System--with initial implementation of 
the Department-wide financial system beginning in fiscal year 1999 and 
ending in fiscal year 2002, the Service Center Initiative's Lan/Wan/
Voice and Common Computing Environment--CCE--which are bringing common 
telecommunications, and network and desktop hardware and software 
infrastructures, to over 2500 county-based farm service centers. Lan/
Wan/Voice deployment is over 85 percent complete, with the remainder to 
be completed in fiscal year 1999. CCE deployment was initiated in 
fiscal year 1998 for Year 2000 machine replacements and will continue 
through fiscal year 2002 to fully complete the system. And, the 
Procurement Modernization Team is working to provide modern, integrated 
procurement automation tools and streamlined business processes to the 
USDA acquisition community--breaking down ``stovepipes'', reducing the 
time and cost of processing procurement actions, and better supporting 
the Department's mission.
    Question. To what extent did the Department follow a CPIC process 
and its current IT architecture to direct and approve the IT 
investments planned for fiscal year 2000?
    Answer. Version One of the USDA Information Systems Technology 
Architecture, issued in February of 1997, was the foundation for OCIO 
architectural review during the fiscal year 2000 budget cycle. The 
Department has also developed a Guide to its Capital Planning and 
Investment Control process, which was recently approved and it is being 
printed for distribution to USDA agencies and staff offices. The Guide 
is a reference manual that provides information about Capital Planning 
and Investment Control and was developed with significant input of USDA 
agencies. While the Guide was not published officially at that time, it 
was available to all agencies as guidance for the fiscal year 2000 
budget cycle. The principles within the Guide include criteria for 
investment selection such as mission, cost, and technical issues 
including architecture. They formed the basis for OCIO's budget review 
for fiscal year 2000.
                 usda fiscal year 2000 budget increase
    Question. USDA's fiscal year 2000 budget summary shows a budget 
increase of $2.4 million for the Chief Information Officer (CIO) to 
continue implementing a plan to strengthen the department's management 
of information technology across several areas. Based on the various 
areas cited:
    What are the CIO's plans for improving Department-wide management 
and security of information systems and telecommunications networks?
    Answer. In January 1999, the USDA CIO appointed a new Associate CIO 
for Telecommunications Services and Operations--TSO to provide day-to-
day management leadership while also assuming long term strategic 
planning responsibilities for the Department's telecommunications 
network. In this role, the Associate CIO for TSO will ensure the 
necessary safeguards to protect USDA's telecommunications 
infrastructure are implemented.
    In fiscal year 2000, OCIO will be leading Departmental initiatives 
to improve and strengthen information security and telecommunications 
management across the Department. Presidential Decision Directive--
PDD--63, which mandates USDA take appropriate steps to protect its 
critical infrastructure, will form the basis for these activities. The 
Department will begin by assessing the risk to its information and 
telecommunication networks. Potential risks include: intrusion by 
unauthorized individuals, disruption of services due to natural 
disasters, malicious actions by USDA employees, data corruption, 
critical system failure propagated from a failure in a connected non-
critical system, computer viruses and worms, etc.
    The fiscal year 2000 budget request includes funding for the USDA 
risk assessment and for subsequent actions to address and mitigate 
identified vulnerabilities to the maximum extent possible. The budget 
request also includes funding to leverage agency resources in creating 
a USDA incident response capability, and to ensure the readiness of 
USDA telecommunications services required to support the Department's 
Continuity of Government plan.
    Training will also be an integral part of USDA's security plans. 
OCIO is beginning this effort by coordinating a security course for 
USDA agency IT staff interested in this rapidly expanding and crucial 
area. By building security expertise inside the Department, USDA 
respond more quickly and effectively to future security threats.
    USDA has also implemented a comprehensive Information Security 
Policy review and update project to keep up with the rapid pace of 
change in the information security field. In fiscal year 2000, OCIO 
will continue focusing on Internet security policies to guide the 
Department's use of identification and authorization tools, Internet 
firewalls, encryption and digital signatures and certificate 
technology, Virtual Private Networks, and other Internet security 
issues. The policy review will also include the development of new 
policies and revision of existing policies in such areas as electronic 
mail privacy and security, incident reporting, software piracy, and 
security awareness and training.
    Further, OCIO is working with USDA Agencies to: 1--respond to 
existing regulatory requirements as well as PDD 63 requirements; 2--
link the IT security planning and budgeting processes; and 3--establish 
performance indicators for measuring the effectiveness of agency IT 
security programs. As part of this process, Agency IT security 
submissions are due to OCIO by June 1, 1999. After an initial request 
for IT security budgets during late 1998, agencies will be required to 
submit IT security budget information as a part of the annual A-11 IT 
budgeting process.
    Question. How does the CIO plan to strengthen IT capital planning, 
review and evaluation processes and refine the Department-wide 
architecture?
    Answer. The Chief Information Officer--CIO plans to strengthen the 
USDA's IT capital planning process in several ways, as resources allow. 
OCIO will play a more active role in phases of the life cycle of 
capital planning by expanding our developed process beyond the 
selection phase to the control and evaluate phases as well, including 
improved project management for information technology. OCIO will also 
make increased use of independent verification and validation, an 
approach that has proven valuable, to review IT decisions, both from 
managerial and technical perspectives. The CIO will also expand efforts 
to bring the understanding and adoption of capital planning, the 
discipline, to the remainder of USDA agencies and staff offices. 
Thereby educating and evolving the existing IT investment processes in 
all USDA agencies to embody the capital planning model, and employ its 
methods and tools to assist in the management of information technology 
investments.
    In fiscal year 2000, OCIO will focus its architecture efforts on 
implementation. In working with USDA agency personnel who are building 
the Department's future financial system, OCIO's will be working to 
ensure that integral pieces of the project such as common 
datawarehousing standards--essential to agency financial reporting and 
a unified loan module--applicable across multiple USDA loan programs--
are designed to share information and re-use technology to the maximum 
extent possible. Similarly, OCIO will help coordinate the Department's 
use of geospatial information systems and data--a technology heavily 
used in the Forest Service and an integral piece of the Service Center 
Modernization Initiative. Further, OCIO architecture coordination will 
focus on a structured approach to providing secure electronic access 
options to USDA program participants.
    Question. What is the CIO doing to develop a workforce planning 
capacity to improve the management of the USDA IT infrastructure?
    Answer. OCIO is actively involved in strengthening the knowledge, 
skills and capabilities of USDA's IT staff. During fiscal year 1998 a 
new member was added to the OCIO staff to work specifically on issues 
relating to the current national IT workforce crisis, as well as 
requirements cited in the Clinger-Cohen Act of 1996. Both the USDA and 
OCIO Strategic Plans include strategies to implement a professional 
development program to ensure that program and IT staffs possess the 
skills necessary to effectively manage and deliver IT programs and 
services.
    During fiscal years 1998 and 1999, OCIO has been collaborating 
closely with USDA's Office of Human Resources Management--OHRM--in IT 
workforce planning and development. Early in fiscal year 1999, USDA's 
Deputy CIO was named co-chair of the Federal CIO Council's Education 
and Training Committee, and is now working with federal agencies to 
ensure adoption and implementation of the core competencies for IT 
professionals approved by the Council.
    During fiscal years 1999 and 2000, the OCIO will continue to 
address IT staffing issues including training, certification, 
classification consistency, and private/public sector challenges in the 
area of IT workforce planning and development.
    Question. How will the Department/CIO provide oversight for the 
single IT infrastructure and supporting organization of FSA, RD, and 
NRCS?
    Answer. Departmental oversight of the Service Center Initiative 
single IT infrastructure and the Support Services Bureau is assigned to 
the USDA Chief Information Officer--CIO, because of the major 
technology component. The CIO carries out this responsibility with a 
Senior Policy Advisor and support position. Activities include 
providing advice and council to senior USDA policy officials and the 
NFAC, conducting reviews, studies and analyses of implementation 
activities, providing Oversight Reports and Issue Papers, working with 
OMB and Congressional staffs on implementation issues and managing 
contracts to utilize independent verification and validation 
contractors to assess technical and management issues. The Oversight 
Staff will also continue to review all IT waiver requests from Service 
Center agencies to ensure that to the extent possible, any investments 
needed to meet emergency needs are made in a way to progress towards 
the long term objective of single IT structure.
    The OCIO Oversight activities have led to improvements in the 
management of the Service Center initiative, better coordination, 
improved technical solutions and a better understanding of the 
initiative both within and outside USDA. It is vital to continue this 
function as the Service Center initiative moves into the next stage of 
major acquisitions and deployment of reengineered business processes.
    Question. How is the CIO's performance in strengthening 
departmental IT management being assessed?
    Answer. The OCIO Annual Performance Plan serves as a tool to assess 
the CIO's performance in strengthening the departmental management of 
information technology. The plan lays out performance measures for 
OCIO's six critical issue areas, which include: 1) assuring mission 
critical information systems are Year 2000 compliant, 2) overseeing 
implementation of a single information technology infrastructure to 
support the Service Center Agencies, 3) improving department-wide 
management of telecommunications infrastructure, 4) developing policies 
and procedures for implementing the Clinger-Cohen Act of 1996.
                 usda information technology moratorium
    In 1996, USDA established a moratorium on all new IT purchases and 
required agencies to obtain a waiver.
    Question. Does USDA still have this IT moratorium in place, and if 
so, what are the Department's plans for future use of the moratorium?
    Answer. In compliance with our fiscal year 1999 appropriation--
Public Law 105-86, the Executive Information Technology Investment 
Review Board has approved all information technology investments and 
the Chief Information Officer continues to review all USDA information 
technology investments to ensure new purchases are consistent with the 
current architecture and are directed at bringing the Department into 
Year 2000 compliance. Since August 1997, any Departmental or Agency 
information technology acquisition over $25,000 requires a waiver from 
the Chief Information Officer. These waivers are granted for 
emergencies and Year 2000 remediation efforts only.
    There are only two types of information technology acquisitions 
which do not require a waiver--existing contracts for mission-critical 
maintenance and leases, and information technology acquisitions by 
organizations other than USDA agencies that are funded by USDA grants.
    Once USDA has achieved its Year 2000 compliance objectives and more 
fully integrated the USDA Information Systems Technology Architecture 
into the capital planning process, OCIO will reassess the moratorium on 
information technology purchases.
    Question. How many waivers did agencies request for each fiscal 
year period since the moratorium was established and what was the 
dollar amount of the waivers?
    Answer. During fiscal year 1997 there were 127 waiver requests 
submitted for approximately $283.7 million. During fiscal year 1998 
there were 246 waiver requests submitted for approximately $379.7 
million. Through April 6, 1999, there have been 80 waiver requests 
processed for approximately $178.2 million.
    Question. How many of these waivers were approved for each fiscal 
year period since the moratorium was established and what was the 
dollar amount of the approved waivers?
    Answer. During fiscal year 1997, 113 waivers requesting 
expenditures of approximately $210.5 million were approved and 5 were 
approved for telecommunications items involving no expenditures. During 
fiscal year 1998, 224 waivers were fully approved and 12 were partially 
approved. Fiscal year 1998 waiver amounts approved totaled $356.8 
million. Through April 6, 1999, 79 waivers were fully approved and one 
was partially approved. Amounts approved totaled $170.6 million.
    Question. How many waivers were denied for each fiscal year period 
since the moratorium was established and what was that dollar amount?
    Answer. During fiscal year 1997, 7 waivers were denied totaling 
$29.5 million, 2 waivers were exempt from the moratorium totaling $43.7 
million. During fiscal year 1998, 7 waivers were denied and 3 waivers 
were canceled by the requesting agency or OCIO for lack of 
documentation. Denied amounts totaled $22.9 million. Through April 6, 
1999, three waivers were canceled by the requesting agency or OCIO for 
lack of documentation. Denied amounts from the partially approved 
waiver total $7.6 million.
                        support services bureau
    Question. USDA's budget for fiscal year 2000 proposes a new 
account, called the Support Services Bureau, to provide consolidated 
administrative support functions, including information technology with 
an identified funding level of about $90 million. This includes an 
appropriation request of $74 million to support this modernization 
initiative, and another $16 million for this purpose will be made 
available from CCC.
    What specifically will this total funding of $90 million dollars 
support by service center agency in fiscal year 2000 (in terms of 
software and hardware acquisitions, FTEs, and contractor support, 
etc.)?
    Answer. Through the end of fiscal year 1999, funding for the 
activities performed within the Service Center Initiative (SCI) is 
provided by the participating agencies. The collective agencies 
determined the budget for each activity and the total amount of their 
contributions. For fiscal year 2000, a direct appropriation is 
requested to fund the continuation of the currently agency-funded SCI 
activities. Since this appropriation is in support of Service Centers 
and not individual agencies, a breakdown by Service Center agency is 
not available. The requested direct appropriation will be supplemented 
by a CCC transfer of $16,231,000.
    The following table provides a breakdown by ongoing activities and 
overall funding source for fiscal year 2000:

                        [In thousands of dollars]

        Activity                                        Fiscal Year 2000
Program/Change Management.....................................     2,500
Business Process Reengineering................................    14,000
Common Computing Environment..................................    48,231
Base Data Acquisition.........................................    25,550
                    --------------------------------------------------------------
                    ____________________________________________________

    TOTAL.....................................................    90,281

    Program/Change Management activities include customer service 
initiatives, change management training programs in the field and at 
headquarters, communications, outreach activities and SCI initiative-
wide program management functions.
    The BPR investment will be employed to complete development and 
pilot testing of the initial Service Center BPR projects included in 
the BPR Business Case and several critical agency projects, and 
complete deployment of the first reengineered applications. In fiscal 
year 2000, an integrated deployment is planned for the Service Center 
Organizer (SCO) software, the Integrated Office Information Systems 
Project, the Common Land Unit Project, the Customer Information 
Management Project and the initial Geographical Information System 
(GIS) Project. The Combined Administrative Management System will also 
be deployed to support administrative convergence of the county-based 
agencies.
    The fiscal year 2000 investment for CCE will build on initial CCE 
workstation acquisitions that include 16,000 systems in fiscal year 
1998, and approximately 6,000 additional systems in fiscal year 1999. 
In fiscal year 2000, deployment of another 8,000 CCE workstations is 
planned. In addition, network servers will be provided to USDA offices 
to allow centralized configuration management of software, real-time 
help from IT support elements and file sharing by service center 
employees. If funding permits, the SCI also plans to deploy an initial 
GIS capability to offices where GIS data is available.
    A total of $25.5 million will be invested to continue acquisition 
of GIS data (orthoimagery and soils data) during fiscal year 2000, in 
accordance with the GIS Strategy published in August 1998.
    Question. Since the new Support Services Bureau is being 
implemented to consolidate administrative costs, should one expect 
corresponding reductions in the agencies' budgets of at least the $90 
million?
    Answer. The fiscal year 2000 budget includes a $74,050,000 direct 
appropriation and transfer of $16,231,000 in CCC funds for the SCI. A 
corresponding reduction of $31,050,000 from the Natural Resources 
Conservation Service has been included by USDA to partially offset this 
request. The fiscal year 2000 budget also requests additional transfer 
authority in support of the consolidated administrative functions that 
will be executed under the Support Services Bureau (SSB). Authority has 
been requested to transfer fiscal year 2000 funds embedded in the 
agency budget requests to the SSB in order to support consolidated 
administrative functions previously performed by the agencies.
     Question. How much in administrative support savings will be 
achieved in fiscal year 2000 and beyond by establishing the Support 
Services Bureau, and how many FTE positions will be eliminated?
    Answer. Secretary Glickman approved the Organizational Structure of 
the Support Services Bureau (SSB) on February 3, 1999, and directed 
that the SSB be operational on October 1, 1999. The Secretary asked 
that the SSB Implementation Team finalize the administrative staffing 
level relative to the SSB formation. This estimate is scheduled for 
completion in May 1999, and will outline the level of administrative 
support needed.
    Question. How much is estimated to be transferred from FSA, NRCS, 
and RD for administrative services for the Support Services Bureau? How 
will this affect salaries and expense accounts of FSA, NRCS, and RD?
    Answer. The Secretary asked that the Implementation Team finalize 
the administrative budget levels relative to the SSB formation. A team 
has been formed to make this estimate for fiscal year 2000 expenditures 
and FTE levels for the SSB. They should complete their work by the end 
of May 1999 and we will provide these estimates to you. Staffing and 
resources for direct program delivery will not be converged, but remain 
specific to each agency.
                          usda service centers
    In August 1998, GAO reported on weaknesses in USDA's service center 
IT modernization effort and provided several recommendations. (USDA 
SERVICE CENTERS: Multibillion Dollar Effort to Modernize Processes and 
Technology Faces Significant Risks (GAO/AIMD-98-168, August 31, 1998.).
    Question. Why does USDA continue to spend millions of dollars 
buying new technology for its service centers before it completes 
business process reengineering and before it finalizes how the 
Department will provide one-stop-shopping in all of its field offices?
    Answer. In the period 1995-1997, USDA did make some moderate 
investments, primarily to upgrade the FSA system 36 machines, to 
upgrade the Natural Resources Conservation Service (NRCS) Field Office 
Computing System (FOCS) platforms, and to provide computers required to 
implement the Dedicated Loan Origination Servicing System (DLOS) of 
Rural Development. USDA acquired 16,000 CCE workstations in fiscal year 
1998, and plans to acquire 6,000 additional workstations in fiscal year 
1999. In fiscal year 1999, USDA is deploying these CCE workstations to 
satisfy Y2K compliance requirements and meet critical agency business 
needs. These interim investments have been coordinated and justified 
separately based on costs and benefits as well as critical program 
needs. They were recognized as steps needed to support the business of 
the agencies as we go through the process of reengineering business 
processes and acquire an interoperable, shared information system for 
all of the agencies. It should be noted that the Rural Development 
investment, in fact, was to implement a reengineered process, the DLOS, 
that will save hundreds of millions of dollars in support and other 
costs. In 1997, USDA instituted a moratorium on IT investment that was 
further strengthened in fiscal year 1998. Exceptions are considered and 
granted only to meet Year 2000 needs or emerging needs associated with 
equipment failures, new program or legislative requirements, or major 
initiatives such as civil rights and Service Center implementation. In 
the case of the Service Center agencies, exceptions granted generally 
include conditions such as buying computers that meet the minimum 
standards set for the Common Computing Environment (CCE) pilot sites.
    Planned Service Center investments are directly tied to the 
business process reengineering (BPR) work that is being done. The 
planned phasing of future CCE investments is consistent with the BPR 
process, including the piloting and testing of the reengineered 
processes and enabling technologies. Phases of technology investments 
will move forward as they are justified and needed to field new 
business processes, meet Year 2000 needs, etc. Because the BPR process 
for current programs and administrative activities will take several 
years to complete, all investments cannot wait until the full process 
is completed. We must enable the Service Center staff to take advantage 
of efficiencies and service improvements as they are ready to be 
fielded. By using an interoperable and scalable architecture that has 
flexibility for modifications as required, USDA will be able to 
transition from the existing to new IT systems in a manageable fashion. 
The business of the collective agencies is too comprehensive and 
complex and changes too frequently to suggest that all business should 
be reengineered before any investments are made. If USDA were to take 
that approach, some of the agency equipment would be nearly twenty 
years old, and we would have foregone the chance to reap benefits and 
efficiencies before replacements were provided, not to mention the 
issue of Year 2000 failures.
    Question. What is the Department's status of addressing the GAO 
recommendation to ensure that all identified weaknesses are addressed?
    Answer. The Department is taking every step necessary to ensure 
that all material weaknesses are addressed prior to approving IT 
investments. Service Center IT projects are subjected to the evolving 
USDA capital investment and control process just as any other 
investment. The Service Center Business Case for technical solutions 
that included benefit, cost, and risk information has been completed. 
The USDA Chief Information Officer (CIO) conducted an independent 
verification and validation (IV&V) contractor review of this 
documentation that, while pointing out some shortcomings that need to 
be addressed, essentially verified that the documentation was properly 
done. The Executive Information Technology Investment Review Board has 
devoted considerable effort to examining these activities and 
monitoring progress. The CIO has established a Senior Executive 
Position to focus oversight activities for this initiative. IV&V by 
outside contractors have been used extensively by OCIO to evaluate 
service center projects and plans. The USDA moratorium and approval 
authority of the CIO for IT procurements are used as control points to 
ensure that proper planning and execution is taking place. The CIO has 
used her authority to suspend projects and stop work when conditions 
have warranted until problems are resolved. Regular reviews of 
milestones and performance are conducted.
    USDA has established processes for the approval, monitoring, and 
control processes for this project. In addition, except for the 
telecommunications initiative that was started in fiscal year 1996 and 
initial Year 2000 computer replacements, only pre-acquisition 
activities have approval from the CIO to proceed. These include support 
for BPR, pilot projects, and technical studies and evaluations. Other 
than Year 2000 compliant investments, the USDA has not approved the CCE 
for procurement and deployment, and the CIO has conditioned any such 
approval on meeting capital investment planning and control 
requirements and other factors. These activities are still in the 
development stage and, as GAO recognized, involve issues that must be 
resolved before USDA will move ahead. These issues have been identified 
earlier by the internal USDA oversight process and are in the process 
of being corrected. USDA has no intention of moving forward with CCE 
acquisition until all of the requisite plans, management and controls 
are in place to ensure success. The CIO is currently engaged in a 
review of how the Service Center Initiative has responded to 
management's concerns raised in the past to ensure that all appropriate 
corrective actions have taken place.
    Question. What is the status of the Department's effort to 
implement one-stop service, what will this entail, in terms of a 
concept of operations, and when will this be implemented? (Provide the 
latest time frames and milestones for all major activities related to 
this effort).
    Answer. We are in the process of updating our implementation plan 
to reflect recent funding levels that were lower than those requested 
in fiscal year 1998 and 1999, and the impact that such levels have had 
on the original plan. USDA developed a Service Center Concept of 
Operations in 1996 and 1997. The Concept of Operations served as the 
springboard for the 1997 BPR study, consisting of the four BPR teams. 
The USDA October 1997 Business Case documented the results of the BPR 
Study. USDA is in the process of updating the Concept of Operations and 
overall plan by the end of July 1999 to reflect the current Service 
Center Initiative. We will provide a copy of these documents when they 
are available.
    Question. What has the Department identified as its funding needs 
in fiscal year 1999 and 2000 for making USDA service center agencies' 
information systems and other technology Year 2000 compliant and for 
supporting ongoing operations and maintenance of its systems?
    Answer: To be provided to the subcommittee.
    Question. Has the Department assigned a senior-level official with 
overall responsibility, authority, and accountability for managing and 
coordinating the separate service center IT modernization projects, 
when was this assignment made, and who was assigned?
    Answer. The Secretary has approved an organization of the SSB which 
has a National Board of Directors made up of the Administrator of the 
Farm Service Agency, The Deputy Under Secretary of Operations and 
Management of Rural Development, and the Chief of the Natural Resources 
Conservation Services. An Executive Director who reports to the 
National Board will lead the SSB. In support of the national structure, 
each state will have a Board of Directors and a single Administrative 
Support Unit. In addition to the State units, four unique program units 
have been identified. These entities will also have a Board of 
Directors and a single Administrative Support Unit. To ensure a single 
point of accountability for the SSB, the National Board of Directors 
will allocate administrative funds and delegate administrative 
authorities to the SSB Executive Director, which, in turn, will be 
reallocated to the State Board of Directors. The Executive Director and 
other senior leaders of the SSB will be fully responsible to the 
National Board for ensuring that the needs and requirements of the 
serviced agencies are met. The SSB Deputy Director will also be the 
Chief Information officer for this group of Agencies, and will manage 
the IT support for the Service Center Initiative.
    The Secretary signed a memorandum on March 3, 1999, approving the 
organizational structure of the Support Services Bureau and appointing 
Joseph Leo as the Acting Executive Director for implementing the new 
organization.
    Until the SSB is operational, the ongoing SCI will continue to 
operate as a joint project for FSA, Rural Development, and NRCS. The 
Deputy Secretary assigned the responsibility for strategic coordination 
and management of the SCI to the National Food and Agriculture Council 
(FAC), with oversight by the USDA OCIO. The National FAC manages the 
efforts of inter-agency project teams working towards completing the 
SCI. All Service Center Agency staff working on the SCI is contributed 
by the agencies without reimbursement.
    Question. Why hasn't the Department implemented GAO recommendations 
calling for the CIO to be held accountable and responsible for managing 
and implementing the service center IT modernization effort?
    Answer. The Department did not agree with the GAO recommendation. 
Our position is that we will continue to place accountability with the 
program leaders of the agencies to ensure that the modernization, 
business process reengineering, change management, and other components 
of the Service Center initiative are carried out successfully. The USDA 
CIO will continue to provide a strong oversight role to ensure that the 
IT modernization is done correctly and is in accordance with the 
overall IT architecture envisioned for the Department.
    Question. GAO also recommended in its report that, until critical 
weaknesses in the Department's service center IT modernization effort 
are resolved, USDA should limit IT funding to its service centers to 
only that necessary to (1) bring mission-critical systems into Year 
2000 compliance; (2) implement cost-effective efforts that support 
ongoing operations and maintenance; and (3) develop and document a 
concept of operations and the new mission-critical business processes 
necessary to provide one-stop service at all sites and integrate the 
service center business process reengineering project with its county-
based study.
    Why has the Department disregarded this recommendation?
    Answer. Not all past and planned USDA IT procurements during 
reengineering are tied directly to business processes. There are 
technologies that are universally needed and are available to 
accomplish basic business activities. These include office automation 
applications, electronic mail, Internet access, and other similar 
applications. Also, there is recognition that these common applications 
can be supported on computer systems sold as basic desktop or laptop 
business platforms.
    Many of USDA's simple business processes can be reengineered to 
make immediate use of these common tools to deliver services. Most 
organizations are approaching technology implementation with the 
recognition that both the business processes and the technology 
components are not static. If either component is held constant while 
the other is refined, the result is an unbalanced solution. Either the 
business or the technology has changed to the extent that the solution 
no longer serves the organization. IT experts are advising that there 
are basic technology components that can be implemented and that 
business process reengineering can proceed in parallel with these 
acquisitions. The Common Computing Environment Project implementation 
plan is structured to acquire these types of technologies within the 
first phases, with the more business sensitive components delayed until 
the reengineering is more complete. This approach allows the Service 
Center implementation to proceed and, at the same time provides the 
opportunity to better match technology with the business requirements. 
It also enables the agencies to field current or soon to be available 
reengineered processes as they are ready to be implemented.
    Question. The President's budget shows in its Information 
Technology Performance Table (Table 22-1) that $90 million was spent in 
fiscal year 1998 for the Common Computing Environment (for the service 
centers), and that about $50 million would be spent during fiscal year 
1999 and another $90 million spent in fiscal year 2000.
    Define what the Common Computing Environment entails (i.e., 
technology being acquired, number of sites, number of staff, etc.), and 
describe how the Department is measuring its performance in achieving 
its Common Computing Environment goals?
    Answer. As discussed earlier, $48 of the $90 million will be used 
for the Common Computing Environment (CCE) Project, with the remaining 
funds to be used in support of the Program/Change Management, Business 
Process Reengineering, and Base Data Acquisition projects. CCE is 
providing the hardware and software for the integrated business systems 
necessary to make one-stop service a reality and to deploy the 
reengineered business processes. At the core of this vision is a shared 
information system that provides service center staff access to 
customer, program, technical, and administrative information, 
regardless of the agency they represent. The preliminary CCE technical 
architecture is complete, and is being tested in service centers sites 
with BPR pilot projects. More than 16,000 CCE workstations have been 
acquired to replace agency systems that do not comply with Y2K 
requirements and provide critical business functionality required for 
current program delivery. These machines and accompanying software will 
be delivered in the third quarter of fiscal year 1999. In fiscal year 
2000, we plan to acquire 8,000 workstations, initial network and GIS 
servers, and necessary software to run the reengineered processes. We 
currently have 17 employees assigned to the CCE project. Full CCE 
deployment is scheduled for completion by the end of 2002, depending on 
the availability of funding.
    When fully implemented, the Common Computing Environment (CCE) 
will:
  --Provide the enabling technologies to support the successful 
        introduction of reengineered business processes across the core 
        service center agencies (FSA, NRCS and Rural Development).
  --Optimize the data, equipment, and people sharing opportunities for 
        service center agencies.
  --Overcome the extreme limitations of the current legacy systems.
  --Allow the service centers to use commonly available information 
        technology, such as the Internet, to deliver services and 
        conduct business with customers and partners.
  --Achieve efficiencies across the agencies and enhance customer 
        service today and into the 21st Century.
    The vision is of open systems operating within a common technical 
architecture sustaining both the program delivery and administrative 
support needs of the agencies. The business requirements for defining 
the CCE will come, in large part, from the BPR and Business Process 
Improvement (BPI) efforts within the Service Center Initiative.
    The performance measures for the CCE initiative are based on 
acquisitions and deployment. However, all these acquisitions and 
deployment are driven by the BPR, customer service, base data 
acquisition, and sharing of information in a common technical 
architecture. All of these activities are dependent upon each other 
and, accordingly, their performance is measured as a whole, not 
individually. Performance measures for the entire project are included 
in our 2000 Annual Performance Plan that was submitted to Congress this 
year.
    Question. What are the current estimated life-cycle costs for the 
Common Computing Environment, what time period does this cover, and 
when does the USDA expect to have it completely implemented? (Include 
all important time frames and milestones).
    Answer. The Department is in the process of updating the Common 
Computing Environment Deployment plan. This plan includes estimated 
procurement and delivery dates, necessary levels of funding, and the 
life-cycle costs. The plan should be completed in July 1999. We will 
provide a copy of this plan when it is completed. Acquisition cost for 
the CCE as currently estimated at about $360 million.
    Question. What was acquired for the USDA Service Center, in terms 
of the number and cost of computers, software, etc., with the fiscal 
year 1998 expenditure of $90 million and the estimated $50 million in 
fiscal year 1999 expenditures for the Common Computing Environment?
    Answer. The fiscal year 1998 $90 million expenditure and fiscal 
year 1999 estimated $50 million expenditure will cover all of the 
Service Center activities and not only CCE. In fiscal year 1998, more 
than 16,000 CCE workstations were acquired at a cost of approximately 
$29.5 million under CCE. A total of about $3.0 million in fiscal year 
1998 and $2.4 million in fiscal year 1999 is allocated to technical 
studies required for defining the CCE Technical Architecture. In fiscal 
year 1999, nearly $7.0 million will be spent to acquire 6,000 
additional CCE workstations and software, and conduct deployment 
activities.
    Program/Change Management activities include customer service 
initiatives, change management training programs in the field and at 
headquarters, communications, outreach activities and program 
management expenses. BPR expenditures include costs of project 
developments, equipment and preparations for 9 service center pilot 
sites and 5 State Office pilot sites, training of test personnel, and 
the conduct of pilot testing activities. LAN/WAN/Voice expenditures 
include costs to complete installations at approximately 2,200 USDA 
offices and operate and maintain the infrastructure that has been put 
in place. Base data funds are used to acquire orthoimagery and soils 
data required to develop and test our Geographical Information System 
(GIS).
    A table showing the budgets by activity for fiscal years 1998 and 
1999 follows:

------------------------------------------------------------------------
                                                   Fiscal year--
                Activity                 -------------------------------
                                               1998            1999
------------------------------------------------------------------------
Program/Change Management...............           2,050           2,500
BPR.....................................           9,516          11,388
Common Computing Environment............          33,536           9,332
LAN/WAN/Voice...........................          25,275          11,400
Base Data Acquisition...................          19,750          15,050
                                         -------------------------------
    TOTAL...............................          90,127          49,670
------------------------------------------------------------------------

    Question. The explanatory notes indicate that of the $7.5 million 
for fiscal year 1996 to the Secretary of Agriculture for Service Center 
Implementation Team, $224,951 were obligated in fiscal year 1998 and 
$4,465,344 remains. What are your plans for obligation of the remaining 
amount?
    Answer. The unobligated funds remain in the Office of the Secretary 
account for the use of the Service Center Initiative (SCI). We plan to 
spend most of the $7,500,000 by the end of fiscal year 1999. The 
carryover funds will be used to coordinate the SCI activities and to 
supplement shortcomings of funding from the participating agencies. 
activities as mandated by Congress.
   delivery of usda programs, services, and benefits via the internet
    The Internet is being used more and more by companies to conduct 
business and deliver services and benefits via what is called e-
business.
    Question. To what extent is USDA presently delivering 
programs,benefits, or services via e-business and how does the 
department plan to expand the use of Internet in the future?
    Answer. A sample of current and future USDA e-business applications 
to serve the public via the Internet is provided below:
    Farm Service Agency--FSA--consistent with the Federal Acquisition 
Streamlining Act, the Electronic Bid Entry System (EBES) was developed 
and implemented January 1998 to automate the bid entry portion of the 
commodity procurement process. The EBES application received a runner-
up award in the ``1998 Windows World Open'' competition held in Chicago 
April 20-23, 1998. EBES also received a ``Government Technology 
Leadership Award'' December 1, 1998. The Financial Internet Site was 
developed in February 1999. FSA/CCC began officially using the FSA/
Financial Internet site to announce the monthly interest rate changes 
related to price support and marketing assistance loans. This process 
replaced paper notifications that were mailed to the cotton, peanut and 
tobacco associations each month.
    Participation in FSA programs through Electronic Funds Transfer 
(EFT) increased from about 14 percent in the 1st Quarter of fiscal year 
1998 to 56 percent during the 4th quarter. A total of about 2.5 million 
payments were disbursed during the 4th quarter of fiscal year 1998, 1.4 
million of which were disbursed via EFT. This participation level 
increased to 71 percent during the 1st quarter of fiscal year 1999. 
Major payment activity during this time frame included--$2.8 billion in 
Market Loss Assistance Payments and $4.5 billion in Production 
Flexibility Contract Payments. FSA is now planning an EFT disbursement 
process through Treasury for the Farm Loan Programs.
    Agriculture Marketing Service (AMS) in a joint project with FSA, 
will implement an electronic bid entry system to automate the bid entry 
portion of the Domestic, Dairy, and AMS commodity procurement 
processes. Vendors will submit bids electronically via an Internet web-
based application. Bids will then be forwarded to a database which will 
be used to analyze the bids and generate contracts. Programming, 
testing, training and implementation will be completed this fiscal year 
1999.
    Rural Development (RD) provides prospective sellers electronic 
access to its business opportunities through the OSDBU page of the USDA 
Departmental Administration home page. This site provides forecasted 
opportunities for the current fiscal year for USDA agencies.
    Research, Education, and Economics Agency (REE) established a 
procurement Web-page to provide electronic access to facilitate 
government and private industry access to REE procurement 
opportunities, including on-line solicitation documents.
    Food and Nutrition Service (FNS) Electronic Benefits Transfer (EBT) 
is an extension of electronic credit and debit procedures that have 
been developed as part of the commercial payment systems. EBT systems 
issue and redeem benefits through the use of an electronic funds 
transfer network and point-of-sale--POS--technology. FNS is engaged in 
EBT initiatives to support the Food Stamp Program--FSP and the Women, 
Infants, and Children (WIC) Program. The use of this technology 
eliminates the need for paper coupons and cash change in the issuance 
of benefits. These initiatives feature automated links between FNS, the 
Federal Reserve, the Department of Treasury's ASAP system and state 
partners. Currently 33 states and the District of Columbia have 
operational Food Stamp EBT systems. Two milestones were passed during 
1998 when the monthly volume and value of EBT transactions exceeded 
those for the traditional coupon-based technology. During September of 
1998, there were over 1.7 million Food Stamp transactions via EBT, 
totaling nearly $681 million in benefits. The corresponding statistics 
for coupon-based benefits were slightly over 1 million coupon 
transactions, with a value of approximately $613 million.
    The Food Stamp EBT initiative expects to achieve implementation in 
42 states by the end of fiscal year 2000. The WIC EBT initiative plans 
to increase the number of state operational pilot systems from one to 
seven by the end of fiscal year 2000.
    Forest Service--National Recreation Reservation Service (NRCS)--In 
October, 1997, the Forest Service in conjunction with the US Army Corps 
of Engineers, entered into a service contract with Park.Net, Inc. to 
allow the general public to make reservations for recreation activities 
in the national forests and waterways. The system began accepting 
reservations in October 1998. The Forest Service, through a contractor, 
sells reservations to the public via a call center, electronically 
through computers at field location sites, and through an interactive 
Internet web site.
    Office of Procurement and Property Management (OPM) has defined 
requirements for a USDA-wide procurement system that includes the 
ability to identify buyers and sellers in a secure environment. OPPM 
has begun evaluating a commercial procurement system that provides 
electronic access to buyers and sellers in a secure environment.
    Question. What level of expenditures, either IT-related or 
otherwise, are planned to support or develop e-business for USDA 
program delivery?
    Answer. The Department has not separated future e-business 
expenditures from Agency IT budgets. However, the Service Center 
Agencies have begun to study the future infrastructure costs necessary 
to provide electronic access to America's farmers. And, OCIO will be 
devoting more time and resources to this issue in the coming year.
             commodity credit corporation (ccc) funding cap
    Question. In 1996, the Congress limited CCC's funding for ADP 
equipment and services during fiscal years 1997 through 2002. What has 
USDA spent each fiscal year (from fiscal year 1997 to the present) 
under the caps and for what purpose were these funds expended?
    Answer. CCC funding for investments in automation and servicing of 
existing automation was limited to $275 million during fiscal years 
1997 through 2002 by the Federal Agriculture Improvement and Reform Act 
of 1996. Within this cap, ongoing maintenance as well as system 
improvements have to be accommodated. However, since this Act was 
passed, additional legislation has reduced the originial cap by $87 
million to $188 million, a cut of over 30 percent from the originial 
$275 million. Given the need to meet basic maintenance requirements for 
current systems, only a portion is available for technology 
investments.
    In fiscal year 1997, total obligations for CCC ADP were $36.1 
million. All but $3.5 million was for ongoing system maintenance needs. 
In fiscal year 1998, total CCC ADP obligations were $80.6 million of 
which $35.5 million was used for ongoing systems maintenance and the 
balance of $45.1 million was used for technology investment in service 
centers. The fiscal year 1999 appropriations act limits spending for 
CCC ADP to $65 million. It is anticipated that the bulk of this 
spending will also be for system maintenance. System maintenance 
spending is critical to ensure the continued operation of existing 
systems, some of which will eventually be replaced with tecnology being 
deployed to the Service Centers. Maintenance funding includes support 
for networks, CCC accounting systems and commodity management systems 
needed to support CCC programs.
    Adequate investment in information technology is critical to the 
success of the plan to consolidate farm, conservation and rural 
development program delivery into Servie Centers. The plan called for a 
reduction in the number of field offices from over 3,700 to about 2,560 
Service Centers, and staffing reductions accompanied by major 
technology investments. To date, the number of field offices has been 
reduced to about 2,700 and staffing reduction have occurred; however, 
the corresponding IT investment has not taken place.
    Recognizing the need to increase the level of support for IT to 
begin to fulfill the objectives of the consolidation plan, the fiscal 
year 2000 President's Budget proposes a new, direct appropriation of 
$74 million for these investments in a central account, the Support 
Services Bureau account. In addition, approximately $16 million of the 
estimated remaining balance under the CCC ADP cap will be transferred 
to this new account which will then provide a total of $90 million for 
technology investment in the Service Centers in fiscal year 2000. Only 
through the necessary technology investment can the goal of providing 
efficient and effective service to agricultural producers and rural 
people through ``one stop'' Service Centers be met.
                   interagency food safety initiative
    Question. How are information systems and other new technologies 
being used to achieve objectives under the President's interagency Food 
Safety Initiative and what are the costs? What information systems are 
involved?
    Answer: The President's fiscal year 2000 interagency Food Safety 
Initiative includes one time funding to implement the Field Automation 
Information Management (FAIM) project to provide States off-the-shelf 
inspection automation infrastructure to accommodate HACCP. The State 
FAIM initiative is not a single application but a collection of 
systems. FAIM provides inspectors with electronic forms, technical 
references, office automation tools, electronic mail, and computer 
based training. The number of applications has and will continue to 
expand over time, with HACCP inspection scheduling and reporting to be 
the next significant application added. Taken as a whole, the State 
FAIM initiative provides the infrastructure to support new inspection 
technologies such as HACCP, and brings the States and FSIS closer to 
having a uniform nationwide inspection system.
    Question. What performance measures have been established to 
evaluate success of the Food Safety Initiative and to what extent have 
these measures been achieved?
    Answer: FSIS established performance measures in the Fiscal Years 
1999 and 2000 FSIS Annual Performance Plans to evaluate the success of 
the Food Safety Initiative. These measures, which can be found under 
``Performance Goal Two'' of the plans, include:
    [The information follows:]

 
------------------------------------------------------------------------
                                                  Fiscal years--
                                         -------------------------------
                                           1997    1998    1999    2000
------------------------------------------------------------------------
Number of foodborne illness causing            7       7       7       9
 pathogens monitored in collaboration
 with the CDC, FDA and State Public
 Health Departments through the
 Foodborne Disease Active Surveillance
 Network (FoodNet). Fiscal year 2000
 estimates include two parasites:
 Staphylococcus enterotoxin, and
 Listeria monocytogenes and Listeria
 species................................
Number of FoodNet Case Studies..........       2       3       3       3
Number of new formal risk assessments          1       1       1       1
 initiated annually to identify and
 quantify food safety risks.............
Number of cooperative agreements with...     N/A     N/A     N/A       5
States for risk assessment..............  ......  ......  ......  ......
Standard operating procedures             ( \1\   ( \1\   ( \1\   ( \1\
 established for coordination of               )       )       )       )
 foodborne illness outbreaks and other
 food safety emergencies................
Strategy with HHS and USDA, and private      N/A  ( \1\   ( \1\   ( \1\
 sector groups developed and implemented               )       )       )
 to expand communications on food safety
 information to the general public......
Number of people reached with food           110     132     158     170
 safety information through media
 stories, circulation reports, Home Page
 visits, Hotline calls (in millions)....
Number of Federal-State joint
 undertakings in:
    Technical conferences...............      12      12      12      12
    Advisory Committees.................       3       3       3       3
    Other Committees....................       3       3       3       3
------------------------------------------------------------------------
\1\ Yes.

    The Agency is confident that these activities are on target. 
However it should be noted that these are long term projects. For 
example, FoodNet, which is a collaborative effort with HHS, will be the 
main source of information used to monitor projects in achieving the 
FSIS stated outcome of a 25 percent reduction in the number of 
foodborne illnesses associated with meat, poultry, and egg products by 
the year 2000. Many factors can influence disease incidences on a year-
to-year basis, and it will be necessary to collect several years of 
data to be confident of the stability of trends. These performance 
measurements will be reassessed once the President's Council on Food 
Safety finalizes a strategic plan.
   usda response to gao telecommunications management recommendations
    In 1995, GAO reported that USDA was not effectively managing its 
telecommunications systems and services USDA Telecommunications: Strong 
Leadership Needed to Resolve Management Weaknesses, Achieve Savings 
(GAO.AIMD-98-131, June 30, 1998). Because of this, the GAO indicated 
that the Department was wasting millions of dollars each year paying 
for unused, unnecessary, and uneconomical telecommunications services. 
To its credit, USDA took some steps to begin addressing GAO's 
recommendations for resolving the telecommunications management 
problems at the Department--improvements that USDA says could reduce 
its $200 million-plus reported annual investment in telecommunications 
by as much as $70 million each year. However, GAO again reported in 
1998 that the Department had failed to achieve any significant cost 
savings and management improvements because its corrective actions were 
incomplete or inadequate.
    Question. What progress has the Department made since GAO's 1998 
report to implement GAO's recommendations to:
  --ensure that all telecommunications resources are inventoried, 
        properly accounted for, and cost-effectively managed;
  --consolidate and optimize telecommunications services to achieve 
        savings where opportunities exist to do so;
  --adequately plan integrated networks in support of USDA's 
        information-sharing needs;
  --determine the extent to which the Department is at risk nationwide 
        for telephone abuse and fraud and acted to mitigate those 
        risks?
    Answer. The USDA Telecommunications Network Stabilization and 
Migration Program--TNSMP--established in May 1997, clearly defines 
agency and Departmental telecommunications management roles and 
responsibilities. As part of the TNSMP, twenty-one major hub cities 
have been identified for consolidation/optimization. Further, as part 
of the Department's transition to the new FTS2001 contract, the 
Department will connect these cities into shared USDA network. Thereby 
implementing the phase one of the Department's future Enterprise 
Network.
    A Departmental moratorium on the acquisition of all 
telecommunications resources was established in the fall of 1996 and 
remains in effect today. The moratorium requires USDA agencies to 
document the need for each telecommunications acquisition prior to 
initiating the acquisition process. Waivers have been granted only when 
clearly demonstrated cases for need could be established. In addition, 
opportunities for sharing telecommunications services when applicable, 
were required as a part of moratorium waivers.
    As part of the Department's Year 2000 readiness program, USDA has 
implemented a Department-wide inventory of all telecommunications 
hardware, software, and services, e.g., data and voice communications 
circuits. This inventory will be maintained in a centralized database 
and will be fully operational by the end of April 1999.
    Under Departmental Regulation--DR 3300-1, dated March 23, 1999, all 
USDA agencies and staff offices are required to ``seek and actively 
pursue opportunities for sharing, optimizing, and consolidating of 
telecommunications resources.'' Reorganizing USDA's telecommunications 
network around the twenty-one hub cities identified in the TNSMP, will 
also facilitate improved telecommunication's management throughout the 
Department.
    DR 3300-1 also provides specific policies regarding telephone abuse 
and fraud risks, and mitigation of those risks. This policy requires 
agency personnel to enforce the appropriate business practices and 
educate USDA personnel in the proper use of office telephones, thereby 
mitigating the risk of abuse and fraud. Specifically, ``Agencies and 
staff offices shall establish internal procedures to determine the risk 
of and vulnerability to telephone fraud, waste and abuse of their 
networks. Agencies shall implement cost-effective actions to minimize 
their exposure to telephone abuse. Examples to minimize exposure would 
be to review and verify telephone billing information, block collect 
and third party calls through the Local Exchange Carrier--LEC and 
educate employees on acceptable use policies.''
    In order to better integrate USDA network services, the Department 
is in the process of developing Part III of USDA's Information Systems 
Technology Architecture--ISTA--on telecommunications. The 
Telecommunications Architecture establishes a departmental framework to 
guide agencies in the delivery and management of new and existing 
telecommunications services in order to meet the needs of their mission 
area.
  usda telecommunications savings in fiscal year 1999 and fiscal year 
                                  2000
    Question. What total telecommunications savings have been achieved 
in fiscal year 1999 and how much in telecommunications savings does the 
Department expect to achieve in fiscal year 2000?
    Answer. Total annual savings and cost avoidance across all 
telecommunications sharing, cost reduction, and consolidation 
initiatives for fiscal year 1999 will exceed $3 million. USDA currently 
estimates transitioning to the FTS2001 telecommunications contract and 
optimizing access arrangements will save the Department an estimated $6 
million in fiscal year 2000.
    Question. What has the Department done or planned to do with the 
savings achieved?
    Answer. Telecommunications cost savings achieved in fiscal year 
2000 will be realized by USDA agencies.
                       usda year 2000 preparation
    Y2K is just around the corner, and there have been numerous 
accounts of what could go wrong in the technology arena, from failed 
information systems to embedded chips.
    Question. How many mission critical systems has the Department 
identified and what is the status of making them Y2K compliant?
    Answer. The following table outlines the Y2K status of USDA's 
mission-critical systems as of April 6, 1999.
    [The information follows:]

Total Number of Mission-Critical Systems:
    April 9, 1999.................................................   350
    Number Compliant..............................................   335
        Percent...................................................    96
    Number To Be Replaced.........................................     6
        Percent...................................................   1.7
    Number To Be Repaired.........................................     4
        Percent...................................................   1.9
    Number To Be Retired..........................................     5
        Percent...................................................   1.4
Total Number of Mission-Critical Systems Originally being 
  Repaired:
    Current Number Complete.......................................   266
    Assessment Phase..............................................   266
        Percent...................................................   100
    Renovation Phase..............................................   264
        Percent...................................................  99.2
    Validation Phase..............................................   264
        Percent...................................................  99.2
    Implementation Phase..........................................   262
        Percent...................................................  98.5
 usda fiscal year 2000 expenditures for y2k remediation, testing, and 
                             implementation
    Question. What is the Department's planned expenditure, broken out 
by each agency and the department itself, for completing work on Y2K 
remediation, testing, and implementation of mission critical systems 
during fiscal year 2000?
    Answer. The Department's planned Year 2000 expenditure is provided 
in the following table.
    [The information follows:]

                        [In thousands of dollars]

                                                        Fiscal year 2000
        Agency                                              expenditures
Foreign Agricultural Service..................................        70
Farm Service Agency...........................................     2,130
Food Safety & Inspection Service..............................        85
Agricultural Marketing Service................................        30
Animal and Plant Health Inspection Service....................     2,196
Forest Service................................................       200
Natural Resources Conservation Service........................       110
Agricultural Research Service.................................       205
Cooperative State Research, Education and Extension Service...       280
Economic Research Service.....................................        60
National Agricultural Statistics Service......................       100
Departmental Administration...................................       500
Office of the Chief Financial Officer.........................     1,000
Office of the Chief Information Officer.......................     2,920
Office of Communications......................................       300
                    --------------------------------------------------------------
                    ____________________________________________________

    Total.....................................................    10,186
usda fiscal year 2000 expenditures for y2k work on vulnerable processes 
                              and systems
    Question. For other vulnerable processes and systems, such as 
telecommunications, facilities, alarm systems, etc., what is the 
Department's planned expenditure, broken out by each agency and the 
Department itself, for completing work on Y2K remediation during fiscal 
year 2000?
    Answer. The Department of Agriculture will continue to remediate 
vulnerable processes and systems throughout fiscal year 2000. Funding 
for these efforts will come from the agencies' fiscal year 2000 budget, 
which does not breakout remediation funding for telecommunications, 
facilities, alarm systems, etc. USDA has requested $6.198 million in 
supplemental funding for Y2K remediation of Vulnerable Systems 
(embedded chips in buildings, facilities, scientific and laboratory 
equipment). Supplemental one and two have been appropriated. These are 
three year funds (Fiscal year 1999, 2000, 2001).
    USDA requested Y2K funding for remediation of vulnerable systems, 
by Agency, is provided below:
    [The information follows:]

                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                     Agency                       Supp 1 12/8/98  Supp 2. 2/3/99   Supp 3 4/2/99       Total
----------------------------------------------------------------------------------------------------------------
FSIS............................................             400  ..............             628           1,028
Forest Service..................................           2,000  ..............  ..............           2,000
ARS.............................................             303           1,840             418           2,561
DA..............................................             150  ..............  ..............             150
OCIO............................................             300  ..............  ..............             300
APHIS...........................................  ..............  ..............             159             159
                                                 ---------------------------------------------------------------
      TOTAL.....................................           3,153           1,840           1,205           6,198
----------------------------------------------------------------------------------------------------------------

    USDA requested funding for Y2K remediation of telecommunications 
systems, by Agency, is provided below:
    [The information follows:]

                        [In thousands of dollars]
------------------------------------------------------------------------
                 Agency                       Supp 1           Total
------------------------------------------------------------------------
DA......................................             323             323
OCIO....................................           4,000           4,000
Forest Service..........................           1,750           1,750
ARS.....................................           1,143           1,143
FSIS....................................             200             200
                                         -------------------------------
      Total.............................           7,416           7,416
------------------------------------------------------------------------

         usda agency business continuity and contingency plans
    Question. To what extent has each of the component agencies, staff, 
and field offices completed and tested business continuity and 
contingency plans? For those that have not yet completed and fully 
tested their plans, what are the time frames and milestones for doing 
so?
    Answer. Business Continuity and Contingency Plans--BCCPs--have been 
received from all mission area, agencies, Departmental Administration, 
and several staff offices. The majority of these plans have been 
approved. Final approval from the Under Secretary for one agency plan 
is pending, and we are working with three staff offices regarding their 
plans. The target date for completing these plans is May 21, 1999, with 
USDA's overall plan due to the Office of Management and Budget by June 
15, 1999. However, USDA Agency BCCPs will continue to be reviewed, 
tested, and revised as necessary through September 1999--the date the 
General Accounting Office has recommended for BCCP completion.
    For BCCPs relating to the field/regional offices and service 
centers, OCIO is providing guidance for developing and implementing 
Local Contingency Plans. Several agencies have started this process and 
information is being shared across USDA.
    BCCPs are scheduled to be tested from January through October 1999. 
Several agencies have started testing their BCCP in accordance with the 
GAO Guidelines. The Y2K Program Office is developing additional 
guidance for this testing activity which will be provided to agencies 
by the first week in May 1999. This guidance will give examples of the 
various tests (desktop, rehearsals and simulations), how to plan and 
evaluate the process, and steps for process improvement. As part of the 
review process with agencies, the Y2K Program Office will be working 
with the Office of Inspector General to develop evaluation criteria for 
conducting site visits during agency BCCP tests. The testing schedule 
for the Department and for five agencies or offices who have already 
submitted schedules is provided below.
    [The information follows:]

------------------------------------------------------------------------
                                         Start              Complete
------------------------------------------------------------------------
Department-wide Test Schedule--   January 1999.......     September 1999
 for all mission areas and staff
 offices.
Foreign Agricultural Service....  ...................     September 1999
Forest Service..................  April 1999.........       October 1999
Food Safety and Inspection        February 1999......     September 1999
 Service.
Agricultural Research Service...  March 31, 1999.....     April 30, 1999
National Appeals Division--end-   ...................           May 1999
 to-end testing through March
 1999.
------------------------------------------------------------------------

 usda y2k emergency funding--approved and expected in fiscal year 2000
    Question. How much in Y2K emergency funding has OMB approved for 
the Department, for what specific purpose were these funds requested, 
and how much additional funding does USDA anticipate having to request 
from OMB in fiscal year 2000?
    Answer. As of April 6, 1999, OMB has approved $46,168,420 in 
emergency Y2K funding for Year 2000 work planned for fiscal year 1999. 
These funds are to support remediation activities in our aggressive 
program to address Year 2000 computer and embedded chip problems and 
ensure the uninterrupted delivery of USDA programs and services. 
Supplemental funding requirements include:
  --meeting the remediation needs of additional systems;
  --conducting end-to-end testing;
  --independent verification and validation;
  --business continuity--contingency--planning and testing;
  --hardware and software system upgrades or replacements;
  --embedded and scientific equipment upgrades or replacements; and
  --technical assistance.
    Current base appropriation estimates for fiscal year 2000 are $10.2 
million. USDA does not anticipate requesting additional money from OMB 
in fiscal year 2000, however in the event of unforseen requirements, 
USDA will be able to request additional allocation from the fiscal year 
1999 Supplemental, which is a three-year appropriation.
               presidential decision directive 63--pdd-63
    Under Presidential Decision Directive 63 (PDD-63), federal agencies 
are to ensure the protection of critical infrastructures, which include 
critical information systems, telecommunications, and other essential 
services. To carry out this responsibility, agencies were to have 
developed a critical infrastructure protection plan by February 1, 
1999. According to PDD-63, these plans are to be fully implemented by 
May 22, 2000.
    Question. Has the Department completed its critical infrastructure 
protection plan? If so, what actions must USDA take to implement the 
plan?
    Answer. The USDA Critical Infrastructure Assurance Plan CIAP--has 
been completed and is now in the final steps of Departmental review.
    USDA's CIAP will follow the Vulnerability Framework prepared under 
contract for the national CIAO. It calls for a four staged analysis and 
corrective action strategy to identify and mitigate vulnerabilities to 
USDA's essential cyber infrastructure. In addition, it defines 
responsibilities for continued security assurance, it addresses the 
need for an on-going risk management program, and it identifies the 
basic requirements of a comprehensive Emergency Management Program to 
ensure the continuity of cyber support for the Department's vital 
program activities.
    USDA is well positioned to implement this plan. The analysis and 
planning we have done to correct Y2K problems, optimize our 
telecommunications systems, and develop an information architecture 
will collectively serve as a solid baseline from which we will assess 
the broader array of security concerns. The procedures and policies we 
have in place to support our ongoing information system security 
program will provide additional detail necessary to assess our cyber 
infrastructure and determine what corrective actions are necessary to 
ensure its safety and integrity.
time frames for implementing usda's critical infrastructure protection 
                                  plan
    Question. What are the time frames and overall costs for 
implementing USDA's critical infrastructure protection plan?
    Answer. USDA's Critical Infrastructure Assurance PlanCIAP follows 
the Vulnerability Framework prepared under contract for the national 
Critical Infrastructure Assurance Office--CIAO. Our estimation of the 
time it will take to fully define all of USDA's essential cyber 
infrastructure, identify vulnerabilities of the systems, facilities and 
other assets of that infrastructure, and develop a mitigation strategy 
that will assure continuous operation is 16 months.
    Much of the work called for in the early stages of our 
infrastructure assurance strategy will have already been accomplished 
through our efforts to correct Y2K problems, optimize our 
telecommunications networks, and develop an information architecture. 
Costs for these efforts will not be attributed to our infrastructure 
assurance initiative. Other costs will be borne, in large part, by our 
network of security and telecommunications specialist who work directly 
for our program agencies. Overall coordination will be provided by 
existing staff assigned to the Office of the Chief Information Officer.
    USDA recognizes that critical infrastructure assurance requires 
specialized skills not readily available or resident within our 
technical community. For this reason, the Office of the Chief 
Information Offices has requested $500,000 in its fiscal year 2000 
budget for security measures. These funds will be used to engage 
contract expertise in the areas of vulnerability assessment, intrusion 
detection, risk mitigation, and other critical infrastructure assurance 
plan tasks.
  usda information technology and telecommunications expenditures for 
                                 pdd-63
    Question. How much is being spent to purchase new or upgrade 
existing information technology and telecommunications systems to 
comply with PDD-63?
    Answer. At this time, it is too early to estimate the cost of the 
specific measures necessary to assure the security of USDA's critical 
cyber infrastructure, as required by PDD-63. USDA has developed a very 
methodical approach to defining its critical cyber assets, identifying 
existing and expected vulnerabilities and developing a corrective 
action plan. Much information must be assembled and much analysis must 
be performed prior to establishing a firm cost for complete USDA 
infrastructure assurance.
                   usda information technology budget
Financial Management Systems
    Question. What is the status of USDA's effort to implement its 
single integrated financial management information system?
    Answer. The Foundation Financial Information System--FFIS--is the 
cornerstone of the effort to implement a single integrated financial 
system. FFIS will replace the Central Accounting System--CAS--at NFC 
and will provide a Standard General Ledger for the financial management 
operations there. FFIS is being implemented in phases. Two agencies and 
two regions and one research station of the Forest Service are 
currently up on FFIS. The remainder of the Forest Service and the Food 
Safety and Inspection Service will be implemented on October 1, 1999. 
Other USDA agencies will be implemented in phases with the remaining 
agencies being implemented on October 1, 2002.
    In addition, analysis of the use of a data warehouse is in process 
now. The warehouse will be implemented in phases and will first address 
FFIS reporting followed by the USDA consolidated financial statements. 
A full implementation schedule has not been developed for the warehouse 
pending outcome of the initial analysis task.
    The Office of the Chief Financial Officer has reassessed the 
original Financial Information System Vision and Strategy--FISVIS--and 
believes that a ``single integrated financial system'' will be achieved 
through the sound integration of all financial management systems in 
the Department. The integrated system will be comprised of a data 
warehouse fed by multiple general ledger systems. The information 
contained in those systems used to feed the data warehouse will be used 
for reporting the more detailed information that is not available in 
the summarized information contained in the data warehouse. All of the 
systems involved must meet all applicable authoritative requirements, 
including the capture of information using standard data definitions 
and posting rules, and transactions that are traceable to the point of 
entry.
    Question. How many agencies are currently using the single 
integrated financial management information system, and what are the 
time frames and milestones for having all USDA agencies use it?
    Answer. The Office of the Chief Financial Officer--appropriated 
funds, Risk Management Agency--RMA--and two regions and one research 
center of the Forest Service have been implemented on FFIS. The 
remainder of the Forest Service and the Food Safety and Inspection 
Service will be implemented on October 1, 1999. Other USDA agencies 
will be implemented in phases with the remaining agencies being 
implemented on October 1, 2002.
    Question. What does USDA plan to spend on developing and operating 
its integrated financial management information system in fiscal years 
1999 and 2000?
    Answer. The fiscal year 1999 estimate included in the President's 
budget is $26.9 million; the estimate for fiscal year 2000 is $32.9 
million. As we proceed with the execution this year, we are finding 
that the fiscal year 1999 estimate can be reduced somewhat to $23.8 
million. Further, we have adjusted the fiscal year 2000 estimate 
downward to $32.5 million. These new fiscal year 1999 and fiscal year 
2000 costs are reflected in the project plan developed by the new 
project management team. The estimates do no include any costs the 
agencies will bare internally.
    Question. What are USDA's latest life-cycle costs and time frames 
and milestones for fully implementing its single integrated financial 
management information system?
    Answer. The new 5-year project plan covering fiscal year 1999 to 
fiscal year 2003 includes estimated project costs for that time period 
of $136.1 million. This covers full implementation of all USDA agencies 
by October 1, 2002, post-implementation requirements, as well as 
shutdown activities associated with the Central Accounting System--CAS.
                                 ______
                                 
                National Agricultural Statistics Service
                 Questions Submitted by Senator Cochran
                              puerto rico
    Question. The budget proposes the addition of a NASS office in 
Puerto Rico and describes this establishment as a cooperative 
agreement. Please provide the amount of funds that the Puerto Rico 
Department of Agriculture will contribute to this cooperative 
agreement.
    Answer. The Puerto Rico contribution to the cooperative program 
would exceed 50 percent of the total cost of the joint agricultural 
statistics program. The Puerto Rico Department of Agriculture would 
supply the office facilities and the majority of professional, 
clerical, and field staff. However, the Puerto Rico Department of 
Agriculture would not transfer direct funding to USDA.
    The Government of Puerto Rico has requested that NASS establish a 
cooperative program with the Puerto Rico Department of Agriculture 
which would allow NASS to establish a joint Puerto Rico/USDA 
agricultural statistics office in San Juan. This partnership, which 
would operate similar to others that NASS maintains with State 
cooperators throughout the United States, would enhance Puerto Rico's 
current agricultural statistics program by combining the present Puerto 
Rico Department of Agriculture's Office of Statistics staff with staff 
assigned from NASS.
    A partnership between the Puerto Rico Department of Agriculture and 
NASS would help to bring consistency and comparability between Puerto 
Rico agricultural data and the agricultural statistics collected and 
published for the 50 States. In addition, this office would plan and 
conduct the 2003 and future Censuses of Agriculture in Puerto Rico.
    Question. Will this cooperative agreement obligate USDA for 
additional expenses associated with the census of agriculture?
    Answer. Under this cooperative agreement, NASS would provide some 
data processing equipment as well as Federal personnel, including two 
agricultural statisticians and a data processor, but would not 
contribute direct funding.
                 food safety and pesticide use surveys
    Question. The budget proposes an increase of $2,500,000 for a fruit 
and vegetable food safety survey and an increase of $1,600,000 for 
pesticide use data for the horticulture and greenhouse industries. Are 
other federal agencies contributing funds to fund these surveys? How do 
these programs differ from the Pesticide Data Program, which is not 
funded by NASS?
    Answer. NASS does not anticipate receiving funding from other 
federal agencies in support of these survey efforts.
    NASS currently collects survey data in support of the Pesticide 
Data Program. Pesticide use data are collected for field crops, fruit 
and vegetable crops (in alternate years), livestock, and general farm 
use, along with information on postharvest chemical applications on 
selected commodities. Related information is also gathered on 
Integrated Pest Management practices. The importance of these data 
collection efforts have been elevated due to the requirements of the 
Food Quality Protection Act (FQPA).
    The $1.6 million requested for fiscal year 2000 would be used both 
to fill data gaps for additional commodities not covered under NASS's 
current program and to provide data important to scientists and 
researchers addressing issues related to FQPA implementation. This 
initiative would enable NASS to conduct a pesticide use survey of the 
nursery and greenhouse industries, which are rapidly growing segments 
of agriculture, and would also allow for a significant expansion of 
current field crop, fruit, and vegetable programs to fulfill data needs 
of FQPA. This would be accomplished through a yearly survey rotation 
program. The increasing importance of pesticide use data has been 
reinforced through the refinement of risk assessments with the 
availability of ``real world'' data, as opposed to the use of 
assumptions of maximum usage of pesticides on all acres of commodities.
    In alternating years, NASS would collect and publish comprehensive 
nursery and greenhouse pesticide use statistics at the State level for 
major States where nurseries and greenhouses are located. Pesticide use 
data are needed for these industries in order to fill the void in 
information about what pesticide products and quantities are used for 
producing various nursery and greenhouse plants. In addition, NASS 
would expand pesticide use data collection coverage for field crops 
such as dry beans and peas, canola, flaxseed, hops, lentils, mint, 
rice, rye, safflower, sorghum, sweet potatoes, artichokes, beets, 
brussel sprouts, garlic, kale, collards, mustard greens, okra, 
pumpkins, radishes, squash, and turnip greens. Included in the 
commodity expansion would be collection of additional data relative to 
target pests and preharvest intervals for pesticide applications. 
Through partnering with Michigan State University, the Environmental 
Protection Agency, and other end users, NASS has strived to address 
these emerging data needs as the chemical risk assessment process has 
matured.
    The $2.5 million would be used to fund a survey of fresh fruit and 
vegetable growers and packers to establish a baseline of agricultural 
practices as they relate to food safety. These data would be used to 
address issues related to the President's Food Safety Initiative. The 
survey will be conducted in 14 States representing nearly 85 percent of 
the Nation's fresh fruit and vegetable acreage and will consist of core 
questions covering water, manure management, facility sanitation and 
hygiene, and transportation practices.
                                 ______
                                 
                  Question Submitted by Senator Burns
                    data for crop insurance programs
    Question. The estimated budget for fiscal year 2000 is cut by $8.4 
million for the National Agricultural Statistics Service. This is an 
important service for ensuring accurate data is available for crop 
insurance purposes. In the past, not enough time or resources has been 
spent on the gathering or distribution of this data. How will USDA 
restore and increase this funding to provide assurance that a reliable 
data base is available?
    Answer. The $8.4 million decline for fiscal year 2000 reflects the 
decrease in activity due to the cyclical nature of the census of 
agriculture program and does not reflect reductions to NASS base 
programs.
    NASS supports the USDA crop insurance program through a cooperative 
agreement with the Risk Management Agency (RMA). Through this 
cooperative agreement, NASS provides county estimates for 21 crops 
which RMA requests annually in support of USDA's crop insurance 
programs. RMA utilizes NASS data in the administration of the Group 
Risk Plan. In addition, NASS data are used to formulate premium rates 
and transitional yields for determining insurance guarantees when 
little or no actual production history data are available from the 
producer. To the extent available, RMA also uses NASS data in the 
development of new crop programs and/or plans of insurance.
                                 ______
                                 
                       Economic Research Service
                 Questions Submitted by Senator Cochran
            food assistance program studies and evaluations
    Question. The Economic Research Service was given responsibility in 
fiscal year 1998 and again in fiscal year 1999 to manage the research 
program for the nation's food assistance programs. What was the 
underlying rational you used to guide setting up the program?
    Answer. The first item on our agenda was to develop a set of 
guiding principles for program development and implementation. First, 
we wanted a program that addresses the research and information needs 
of clients--program managers, program participants, Congress, USDA, and 
the public. We believe integrated research in the broader context of 
the current and future economic and social environment is critical. We 
also believe that a broad array of public and private entities should 
be directly involved in the research, evaluation, and review efforts 
and that integration of ERS staff expertise in the development, 
implementation, and accomplishment of research projects will add a new 
dimension to the program. As scientists, our approach is that all 
studies and evaluations should be rigorous and have verifiable and 
unbiased results. ERS standards demand rigorous internal and external 
review of results. It is an ERS policy that all data collected, to the 
extent possible, are publicly assessable and widely distributed--
putting high quality information in the hands of everyone can only 
result in better decisions. Finally, the program would move toward the 
development and maintenance of continuous data sets. The latter will 
allow us to address issues in a more timely, accurate, and cost 
effective manner than relying on very tailored surveys designed to 
address a particular topic.
    Question. Could you explain the process you used to identify 
research priority areas?
    Answer. ERS has sought input from a broad constituency of policy 
officials, researchers, practitioners, advocates, industry groups, and 
service providers to identify and develop our research priorities. In 
January 1999, ERS convened a round-table discussion with over 60 
distinguished experts representing these various groups to obtain their 
individual opinions and perspectives. Participants included Julie 
Paradis, Deputy Under Secretary for Food and Consumer Services; Dr. 
Rebecca Blank from the President's Council of Economic Advisors; Dr. 
Pat Ruggles, Deputy Assistant Secretary for Human Policy Research at 
DHHS; Melinda Newport, the President of the National Association of WIC 
Directors; Barry Sackin, of the National Association of School Food 
Service Providers; Larry Goolsby, the American Public Human Services 
Association; and others.
    Question. How has the Economic Research Service involved the Food 
and Nutrition Service, both this year and last year, in the 
determination of research priorities?
    Answer. To ensure that the ERS program meets the policy information 
and research needs of the Department, ERS is working closely with Food 
and Nutrition Service (FNS) program and research leaders to identify 
needs and priorities. FNS has also been extensively involved in the 
development of contract requirements and the evaluation of 
deliverables. They have a capable and knowledgeable staff that has been 
helpful in our program implementation. Representatives from FNS have 
helped us refine our research agenda, served on technical review 
panels, and assisted with ongoing projects. Their assistance, advice, 
and knowledge of the programs certainly have helped us develop what we 
believe is a program for which everyone can be proud and take credit.
    Question. What are the research priorities for fiscal year 1999?
    Answer. We have identified 6 research themes for fiscal year 1999 
as follows:
    (1) WIC Program Research
    (2) The Food Stamp Program as a Safety Net
    (3) Better Serving the Working Poor
    (4) Child Nutrition Programs
    (5) Outcome-Based Performance Measures
    (6) Research Innovation, Infrastructure, and Outreach
    Highlights of the proposed program include research to stem the 
rising obesity in poor children served by the food programs, and 
research to understand why Food Stamp Program caseloads have declined 
more than expected. Other highlights include research on the role of 
the food assistance programs in establishing dietary patterns, analysis 
and measurement of food security, and research on nutrition and health 
outcomes associated with food programs.
    Question. What staffing adjustments has the Economic Research 
Service made to run the research and evaluation program?
    Answer. The food assistance research program has been given 
priority in ERS. Some of the most senior and capable staff have been 
assigned to manage and direct the program, many of whom have extensive 
experience in the food assistance research area. Staffing has been 
accomplished largely through reallocation of existing personnel. A 
small research office has been established in an ERS division to direct 
and coordinate the activities of more than 30 research scientists 
involved to various degrees in this research program. Two capable and 
knowledgeable senior researchers have been assigned to help direct the 
food stamp and child nutrition research agenda.
    Question. Has ERS used any of the funds to support farm or other 
nonfood assistance research?
    Answer. No. All funds appropriated for food assistance research and 
evaluation have been used to support food assistance and nutrition 
research. In fiscal year 1998, less than $100,000 was used to support 
program administration. The balance was used to support extramural 
research and data collections.
    Question. What is your response to those who believe the ERS 
program is too academic?
    Answer. The ERS research program is driven by policy issues and 
concerns of a critical nature to the nation. Our research outputs are 
designed to inform decisions by members of both the private and public-
sectors. If decisionmakers are to be well-informed, then the 
information base must be credible. Credibility stems from a strong 
science base, which means meeting disciplinary standards for analytical 
rigor and reaching out to the best economists wherever they might be 
found. When appropriate, ERS and ERS-supported research is published in 
academic journals, a process that both helps ensure analytical rigor 
and that builds the Agency's reputation with the scholars and 
universities that produce the next generation of ERS researchers.
    Question. Why did you start a small grants program?
    Answer. A small grants program was created to stimulate new and 
innovative research on food assistance programs and to broaden the 
participation of social science scholars in food assistance research. 
Five academic institutions and affiliated research institutes 
administer the program. Each institute focuses on a particular facet of 
food assistance, such as, diet and health outcomes, relationships to 
poverty and well-being, rural issues, and special at-risk population 
groups. The expected completion date for fiscal 1998 projects is 
September, 1999. Research projects include:
    The Institute for Research on Poverty at the University of 
Wisconsin is looking for proposals that address the effects of food 
assistance on individual and family well-being and food security. They 
were awarded $234,843.
    The Joint Center for Poverty Research, University of Chicago and 
Northwestern University invites proposals on interactions between food 
assistance and other welfare programs, and linkages between the 
macroeconomy and food assistance. They were awarded $262,740.
    The Southern Rural Development Center at Mississippi State 
University will focus food assistance research on rural people, 
families and communities in the South. The Center also proposes to 
initiate a dialogue among scholars through the establishment of a Rural 
South Food Assistance Research Task Force, with the purpose of further 
articulating research priorities on food assistance-related issues. 
They were awarded $220,000.
    The University of Arizona American Indian Studies Program will work 
with scholars at tribal colleges and elsewhere to support research 
addressing the unique position and problems of Native Americans with 
respect to food assistance. Their small grants program will focus on 
the relationship between food assistance programs on reservations and 
family poverty. They were awarded $246,224.
    The University of California-Davis Department of Nutrition will 
award small grants for research on the impact of food assistance 
programs on nutritional risk indicators (anthropometric, biochemical, 
clinical and dietary), food purchasing practices and food insecurity. 
This program will seek to encourage examinations of multiple indicators 
of nutrition impact, and interdisciplinary approaches integrating 
epidemiology, economics or anthropology with nutrition. They were 
awarded $225,024.
    Question. What research is ERS conducting on Able Bodied Adults 
Without Dependents (ABAWDS) and Immigrants, two groups whose Food Stamp 
Program eligibility status were heavily impacted by welfare reform?
    Answer. ERS has two studies underway that are focused on these 
groups. First, we have partnered with several agencies within the 
Department of Health and Human Services to fund a study of how the 
immigrant population is fairing under welfare reform. The project is 
being conducted by the Urban Institute. They are conducting a very 
thoughtful and thorough investigation of the immigrant populations in 
Los Angeles and New York City. The study is well underway.
    Second, we have extensive studies underway on the status of people 
leaving the Food Stamp Program in Arizona, Illinois, Iowa, and South 
Carolina. These studies are looking not only at the ABAWDS, but also at 
the larger number of other people who are leaving the Food Stamp 
Program. We believe this approach will provide a more complete analysis 
and an improved understanding of the issues for decision makers.
    Question. Why has the Economic Research Service placed more 
emphasis on the collection of continuous data sets?
    Answer. ERS is committed to investing in broad-based, program and 
policy relevant data that addresses not only today's needs but also 
future unforeseen needs. These data tend to have less detail on any 
particular program but cover more programs and also tend to follow 
people for a number of years. In this way, we can examine such issues 
as gaps in program coverage, performance measures of outcomes, multiple 
program participation, impacts on diets over one or more days, and how 
households utilize programs over an extended period of time.
    We believe that one of the most cost-effective ways to achieve 
these research objectives is to partner with other federal data 
collection efforts and add important food assistance components. This 
includes support for expanding the low-income samples in the USDA 
Continuing Survey of Food Intake by Individuals, the DHHS Nutrition and 
Health Examination Survey (NHANES), and special supplements targeted to 
food assistance issues in the Panel Study of Income Dynamics and the 
Survey of Program Dynamics.
    We also have a strong research interest in understanding the role 
of child nutrition programs in cognitive development. Consequently, we 
have added a food assistance module in the Department of Education's 
Early Childhood Longitudinal Survey-Kindergarten Cohort (ECLS-K) which 
follows children from kindergarten through fifth grade. These data will 
allow us to examine the relationship between program participation, 
cognitive development, school performance, and children's physical 
activities.
    Question. The fiscal year 1999 Appropriations Act requires the 
Economic Research Service to transfer $2 million of the funds provided 
to it for studies of the food stamp, WIC, and child nutrition programs 
to the Food and Nutrition Service to enable it to conduct programmatic 
evaluations and analyses. Have those funds been transferred?
    Answer. Yes. The Department sent an SF-1151, Nonexpenditure 
Transfer Authorization, to the U.S. Treasury in December 1998 to 
transfer the appropriated funds from ERS to the Food and Nutrition 
Service. The document was processed by the Treasury Department on 
January 18, 1999.
    Question. For fiscal year 1999, the Economic Research Service was 
given responsibility for several Congressionally-mandated studies in 
the food assistance area. What is the status of each of those studies? 
Please indicate who is doing the study, the framework established for 
the study, when the study will be completed, costs, etc.
    Answer. ERS was given responsibility this year for two 
legislatively mandated studies on the WIC program. One study is on the 
appropriate amounts of sugar and fiber in the diets of the WIC 
population and the impact on diets of the sugar limit in dried cereals. 
The other study is to assess the cost containment practices used by 
states (other than for infant formula) on access to the food items by 
participants, WIC voucher redemption, program participation, health 
outcomes, and program costs. As with all congressionally mandated 
studies, we have given these projects top priority.
    ERS was directed to enlist the National Academy of Sciences to 
conduct the first study. We have been in contact with NAS, but they 
will not undertake this particular study. They said it is neither an 
issue of national significance nor does it require their unique 
capabilities. We are currently in discussions with the Under 
Secretary's office to develop a mutually acceptable alternative.
    In reference to the cost containment study, we have met with 
representatives from the Private Label Manufacturers Association, 
General Mills, the National Association of WIC directors, and FNS. We 
are in the process of developing a competitive procurement to conduct 
the study. We expect the project to cost no more than $1.1 million in 
fiscal year 1999 funds for data collection and $400,000 in fiscal year 
2000 for analysis and reporting. We expect the project to be completed 
within three years of contract award.
    In early versions of the agriculture appropriation, ERS was 
directed to do a plate waste study for the National School Lunch 
Program. After it was learned that GAO had just completed such a study, 
the conference report language was changed to have the Secretary 
prepare a report on recommendations to reduce plate waste. FNS will 
prepare this report since it deals with program implementation.
                              food safety
    Question. Funding of $453,000 was provided to ERS for fiscal year 
1999 to provide economic analysis in food safety risk assessment. Has 
ERS begun this work with the funds available? What work is underway and 
what additional work will be undertaken with the additional $453,000 
requested for fiscal year 2000?
    Answer. ERS is continuing research on the costs associated with 
illnesses associated with seven pathogens in food. Starting with the 
estimated numbers of illnesses, and examining the nature and severity 
of the illness, ERS analysts have calculated the medical costs, based 
on the typical treatment needed for each type of illness. When the 
illness implied long-term disability or long-term care, the cost of 
that long-term care, lost wages, and reduced productivity were also 
included. Estimates also take the age and gender distributions of each 
illness into account and for each pathogen both the short-term and 
long-term medical costs. The total annual costs for the seven pathogens 
is between $6.7 and $36 billion annually.
    ERS is participating with other Federal agencies in both the 
National Food Safety Initiative and the President's Food Safety 
Initiative for Fresh Fruits and Vegetables. Under the National Food 
Safety Initiative, ERS is collaborating with the Agricultural Research 
Service, the Food Safety and Inspection Service (FSIS), Office of Risk 
Assessment and Cost/Benefit Analysis, and the Centers for Disease 
Control and Prevention (CDC). ERS is a member of the Risk Assessment 
Consortium established under the Initiative and this collaboration 
supports risk assessment activities relating to food safety policies. 
In collaborating with CDC and FSIS, ERS is using the ``FoodNet'' site 
surveillance data developed under the Initiative to develop better and 
more comprehensive estimates of the costs of foodborne disease and the 
benefits of pathogen reduction.
    ERS is planning a three-year research program to improve our 
estimates of the benefits of food safety using the appropriation of 
$453,000 for fiscal year 1999. This research will be funded under a 
competitive grants process, where one or more research programs will be 
funded over three years to apply state-of-the-art economic analysis to 
estimate the benefits of making the U.S. food supply safer. We 
anticipate a final report will be completed in fiscal year 2002. ERS 
will also be updating and revising our existing estimates of the 
benefits of food safety in collaboration with the Food and Drug 
Administration and the Centers for Disease Control and Prevention 
through our collaborative research program established under the 
National Food Safety Initiative.
    ERS is collaborating with several USDA and other Federal agencies 
on food safety economics research. We are collaborating with the 
Centers for Disease Control and Prevention on a study they are 
conducting on measuring food safety benefits. Our two agencies are 
working together to ensure that the joint research programs are 
complementary and do not result in duplicated effort. ERS is also 
collaborating with staff of USDA's Office of Risk Assessment and Cost/
Benefit Analysis, the Food and Drug Administration, and the 
Environmental Protection Agency on joint research on measuring the 
benefits of safer food. We will be inviting scientists from 
collaborating agencies to provide scientific peer-review of the project 
proposals during the selection process, and will also seek input from 
them during the implementation of the research project.
    In fiscal year 2000, we will continue our research program to 
estimate the benefits and costs of food safety policies and programs. 
The additional funding of $453,000 for fiscal year 2000 will support 
economic analysis in risk assessment activities. We will work with the 
Risk Assessment Consortium established under the National Food Safety 
Initiative to develop priorities for food safety risk reduction based 
on economic criteria. We will expand our knowledge of food safety 
benefits by studying the costs of foodborne disease linked to 
additional microbial pathogens using the FoodNet surveillance data. We 
will also be collaborating with FDA to evaluate the benefits and costs 
of production practices recommended by FDA under the Produce and 
Imported Food Safety Initiative.
                  office of energy policy and new uses
    Question. What work will not be performed by the ERS now that the 
Office of Energy has been transferred to the USDA Office of the Chief 
Economist?
    Answer. With respect to electric utility deregulation research, ERS 
will not duplicate work underway or planned by the Office of Energy 
Policy and New Uses. As a result, if further work in this area is 
funded, we will rely heavily on the Office of Energy for policy 
analysis and expertise on electric utilities. ERS will continue to 
provide modeling and research expertise, and will increase its capacity 
to analyze the financing and delivery of electricity in rural America, 
but will not be the primary source of policy analysis on electric 
utility deregulation issues, those will fall to the Office of the Chief 
Economist.
                     electric utility deregulation
    Question. I understand that the Office of Energy, under the 
auspices of the Office of the Chief Economist, has done an internal 
study on electric utility deregulation at the request of USDA's Rural 
Utilities Service (RUS). Increased funding of $200,000 is requested for 
ERS for fiscal year 2000 for an interagency activity to expand the 
Department's capacity to assess the potential impacts of electric 
utility deregulation.
    How much is ERS currently spending on assessments of the potential 
impacts of electric utility deregulation?
    What research/economic analysis has ERS produced?
    Why is additional research necessary if the Office of Energy has 
already done an internal study on the impacts of electric utility 
deregulation at the request of RUS?
    Who will do this work at ERS? What involvement will the Office of 
Energy have? What involvement will RUS have?
    What role will the Department of Energy have? Is the Department of 
Energy contributing financially to this effort?
    Answer. At the request of USDA Rural Utility Service (RUS), and 
with their financial assistance, ERS undertook a preliminary assessment 
of the rural impacts of electric utility deregulation in fiscal year 
1997. This work was led by the Office of Energy, which at the time was 
part of ERS. The research did involve other ERS researchers as well as 
data supplied by RUS and the Department of Energy. This initial effort 
has resulted in research that is currently being conducted for use by 
the Department to examine some of the potential impacts of deregulation 
at the national level. Recognizing that the electric utility 
deregulation process at the State, and possibly Federal, level will 
unfold over a number of years, ERS requested additional funds to help 
support a long-term research effort on the full range of issues 
surrounding deregulation. We view this as a collaborative effort, 
drawing on the modeling and analytic strengths of ERS, the policy 
expertise of the Office of Energy Policy and New Uses, now housed in 
the Office of the Chief Economist (OCE), and the program expertise of 
RUS. As a result, the work could also be funded through the OCE 
account, but we believe that long-term research on this issue is very 
important as policy makers at the State and Federal level contend with 
the complex issues involved. Answers to your specific questions follow:
    With the creation and relocation of the Office of Energy Policy and 
New Uses, ERS reduced the number of staff working on energy-related 
issues. In fiscal year 1999, we expect to spend between $100 and $200 
thousand on energy-related issues largely focusing on electric utility 
deregulation and biomass fuel.
    Much of our work on electric utility deregulation has been in 
support of the research underway under the auspices of the OCE. In 
particular, the regional economic impacts of anticipated changes in 
electric rates were estimated using a model developed by ERS staff. In 
addition, a forthcoming issue of Rural Conditions and Trends, published 
by the agency, includes a short article on what electric utility 
deregulation could mean for rural America.
    Work underway appears to raise legitimate concerns about the 
distributional impacts of electric utility deregulation, but it is only 
a first step. As State deregulation efforts have demonstrated, there 
are many ways of structuring the deregulation process, each with its 
own set of pricing and competitive impacts. The Department's 
preliminary research, which is not yet complete, only examines some of 
the potential impacts of one scenario for deregulating electric 
utilities. If the Department is to craft programs and policies which 
ensure that rural Americans have access to affordable, reliable, and 
safe electric power as the electric utility sector restructures in 
coming years, it will need a continuing flow of information and 
analysis. Given the sizeable loan programs the Department operates in 
support of rural electric cooperatives, it has an obligation to 
minimize potential loan losses as these key rural electric service 
providers are affected by, and react to, State and Federal deregulation 
efforts.
    This research effort will continue to require the full cooperation 
of ERS, OCE, and RUS. None of these agencies, by itself, has the 
resources and expertise needed to study the full range of issues 
deregulation involves for rural households, businesses, and 
governments; investor-owned, municipal, and cooperative electric 
service providers; and USDA. Within ERS, staff with expertise on 
regional economic modeling, business finance, and industrial location 
will help assess the distributional impacts of electric rate changes on 
the rural economy. RUS will provide expertise and data on rural 
electric cooperatives and the USDA programs serving them. The Office of 
Energy Policy and New Uses within OCE will continue to provide policy 
analysis and spearhead the Department's electric utility deregulation 
work.
    To date, USDA's research on electric utilities has relied upon the 
Department of Energy's (DOE) aggregate models. We will continue to rely 
on DOE's data and models as the starting point for our research on 
rural distributional impacts. DOE has not provided any financial 
support for USDA's electric utility deregulation research thus far, and 
none is anticipated in the future.
         national assessment of climate change and variability
    Question. The fiscal year 2000 budget requests an increase of 
$300,000 for U.S. Global Change Research Program National Assessment 
Activities. Does $300,000 represent the total cost of these assessment 
activities?
    Answer. The $300,000 requested by ERS for National Assessment 
activities is part of an $800,000 total budget request by USDA for 
fiscal year 2000, with the difference split between ARS and NRCS. The 
funding will be used to conduct economic analyses pertaining to the 
potential impacts of climate change and variability on agricultural 
production. These analyses were not undertaken in the first National 
Assessment due to time and financial constraints.
    Assessments play an integrative role across the U.S. Global Change 
Research Program (USGCRP) program by assembling and synthesizing 
scientific results, increasing interaction among scientists and the 
public, and identifying gaps in knowledge. Assessments are also an 
important vehicle for disseminating information to public policy and 
decision making communities. The current National Assessment of the 
Consequences of Climate Variability and Change satisfies the mandate of 
the Global Change Research Act of 1990 to prepare and submit to the 
President and the Congress ``an assessment which integrates, evaluates, 
and interprets the findings of the Program . . .'' This Assessment is 
demonstrating a new public-private partnership that links research to 
the needs of stakeholders by providing managers, policy-makers, and the 
public with information needed to increase resilience to climate 
variability and cope with climate change. The current National 
Assessment is providing valuable information on the ability of 
agricultural and forestry systems to adapt to climate change. Fiscal 
year 2000 assessment activities will focus on continued efforts to 
involve USDA stakeholders in helping to identify risks, opportunities, 
research and information needs associated with increased climate 
variability, and climate change.
    Question. Will Global Change Research Program National Assessment 
Activities related to USDA programs be carried out by ERS or is ERS 
requesting funding for government-wide assessment activities?
    Answer. The funding requested by ERS will be used to sponsor USDA 
research activities pertaining to the impact of climate change and 
variability on agricultural production. ERS will coordinate its efforts 
with the USDA Global Change Program Office and other USDA agencies. 
While the research sponsored by ERS will be related to the goals of the 
National Assessment program, the funding request is intended to support 
the mission of ERS as it relates to global change activities.
                            outlook reports
    Question. How has ERS responded to the language in the reports 
accompanying the fiscal year 1999 Appropriations Act regarding the 
frequency of situation and outlook reports?
    Answer. Beginning in January, 1999, ERS resumed publication of 
field crop and livestock reports on a monthly schedule. This is the 
same frequency as in 1996. There are 3 published reports in each of the 
specialty crop series--Fruit and Tree Nuts, Sugar, Tobacco, and 
Vegetables--compared to 4 in 1996. However, ERS is preparing electronic 
briefing rooms for these commodities that will provide a vehicle for 
more frequent release of data and analysis.
                                 ______
                                 
                 Questions Submitted by Senator Cochran
                             rural housing
    Question. A total of $500 million has been cut from rural housing 
direct loan subsidies over the last five years. The President's fiscal 
year 2000 budget cuts an additional $240 million in budget authority 
for the cost of these loans as well as rental assistance. The fiscal 
year 2000 budget request proposes an additional 10 percent increase, 
$2.5 billion, in HUD funding. If this amount is appropriated, HUD will 
have received a 2 year increase totaling approximately $6 billion. 
While some HUD resources make their way to rural areas, they are not 
adequate to meet the need for improved housing in rural America. Where 
is the $240 million in budget authority being spent in the fiscal year 
2000 proposed budget?
    Answer. I think it is important to put the reductions in budget 
authority for rural housing programs in the proper context. A large 
portion of the reduction in budget authority over the time period you 
referenced is due to the need for less budget authority as a result of 
lower interest rates. Another significant factor was the Congressional 
reduction of the funding for the rural rental housing program. The 
fiscal year 2000 Budget requests $640 million for rental assistance 
with $200 million being available and, therefore, reflected as budget 
authority in fiscal year 2001. This was necessary to remain within the 
budget caps agreed to by the Administration and the Congress. In 
developing the President's fiscal year 2000 Budget, rural housing 
programs were not reduced in order to fund other specific programs.
    Question. At a time when the HUD budget is increasing by 10 percent 
a year and there is an increased need for rural housing assistance, why 
isn't the Administration investing more in rural housing programs?
    Answer. I think of the increases in HUD funding as an effort to 
recover from the disastrous cuts in these programs made during the 
Reagan Administration. The Administration would very much like to 
invest more in rural housing programs, but as I have said previously 
the primary objective is to continue efforts to ensure the budget is 
balanced and continue to meet the highest priority needs. This is a 
delicate balancing act, but one that is necessary because of the need 
to put our fiscal house in order. The Administration has, however, been 
able to provide substantially more guaranteed loan assistance for rural 
housing, which contributes to the amount of housing being built in 
rural America at very little government cost.
    Question. There is a tremendous need of additional housing for 
migrant and seasonal farmworkers. What is the backlog for farmworker 
housing loans and grants?
    Answer. We presently have on hand applications for loans and grants 
totaling $25.1 million. These applications are from the states of 
Pennsylvania, Texas, California, Washington, North Carolina, Florida 
and Oregon. However, we believe that this does not reflect the true 
demand because when we changed from allocating the funds to States and 
began nationwide competition borrowers ceased filing applications with 
States. When we announce the availability of funds in April, I think we 
will have a better idea of the true demand.
                         early warning systems
    Question. Ms. Thompson's testimony indicates that $5 million of the 
funding for community facilities is earmarked to install severe weather 
early warning systems throughout rural areas. The total estimated cost 
is $50 million for all sites. The $5 million will finance the 
installation of the necessary equipment at 15 to 20 of the highest 
priority sites. Where are the ``highest priority sites'' located? How 
many sites have existing towers that can be used? Who will maintain 
these sites once the towers are in working order and what is their life 
span? What is the total number of sites that need service? What is the 
agencies goal for these sites in order to fulfill the Vice President's 
wish for 95 percent coverage of rural areas?
    Answer. The highest priority sites tend to be located in the 
Southeast, Southwest, Great Plains, and Mid-Western states. The 
priority systems is designated by the National Weather Service (NWS), 
based on a number of variables such as population density, and severe 
weather occurrences. The Rural Utilities Service is in the process of 
helping identify existing towers owned by RUS borrowers or others in 
areas targeted by NWS for a transmitter. The number of tower sites is 
not yet known, and constantly increases due to the construction of new 
telecommunications, cellular, paging and other telecommunications 
services. RUS will target its borrowers with towers in the needed areas 
in order to maximize program monies and the number of sites funded. 
However, there will be some targeted areas in which towers do not 
exist.
    Maintenance and liability of these transmitters and constructed 
towers will be assumed by the NWS, and supported through that 
appropriation. Customarily, an existing tower owner retains ownership 
of the tower space, but allows the NWS use for its transmitter. We 
envision a grant recipient (tower owner) purchasing and installing the 
transmitter, and donating the transmitter to NWS. This releases the 
tower owner from maintenance and liability.
    Approximately 170 sites are needed to reach 95 percent coverage. 
RUS believes by utilizing its relationship with its borrowers and using 
grant monies to leverage donation of tower space, we can achieve this 
goal.
              rural electrification and telephone programs
    Question. Ms. Thompson's testimony states that in the rural 
utilities area, a shift has occurred resulting in a move from initial 
connectivity to electric and telephone service to maintenance of an 
aging infrastructure. How many loans lent in RUS are for maintenance 
vs. initial connectivity?
    Answer. Mr. Chairman, the point I was attempting to make in my 
statement is that even though the vast majority of rural residents 
today have access to electrical and telecommunications services, the 
programs we administer are just as needed now as they were in the 1930s 
and 1940s. The primary purposes of the loans today are to maintain an 
infrastructure, upgrade the systems, and connect new customers. About 
45 percent of the electric loans made to distribution borrowers are for 
maintenance and upgrades and the remainder are for connecting new 
customers. For the telecommunications programs the percentage of the 
funds used for new subscribers is about 27 percent.
    Question. The fiscal year 2000 budget request proposes a new 
Treasury Rate Electric loan program. Has this legislation been sent to 
the authorizing Committees? If this new loan program is not authorized, 
how will this affect the budget authority request for other electric 
loans programs? Are the agency's customers demanding a new program such 
as the proposed Treasury rate program? Does the agency have any 
indication that its customers will use this new program?
    Answer. The legislation is in clearance at the Office of Management 
and Budget and will be submitted to Congress in the near future. There 
will be no effect on the budget authority for other electric programs 
if this proposal is not enacted. Agency customers have expressed desire 
to move from the municipal rate program to avoid the long queue for 
loan approval to the guaranteed program, but have also expressed 
anxiety about dealing with the Federal Financing Bank because of the 
bad experiences of the generation and transmission borrowers with the 
FFB during the 1980's. They have also expressed anxiety about having to 
deal with two Federal bureaucracies, RUS and the FFB. We have 
absolutely no doubts the borrowers would use the new program.
                          rural telephone bank
    Question. The fiscal year 2000 budget request proposes 
privatization of the Rural Telephone Bank (RTB) over a ten year period. 
This authorization must be acted on by the Agriculture Committee, not 
the Appropriations Committee. Should this legislation not be enacted 
into law, how will this affect the budget authority for the RTB for 
fiscal year 2000?
    Answer. This should have no effect on the budget authority for the 
fiscal year 2000 budget since the language appropriates the funds from 
the unobligated balances of the RTB liquidating account.
                      business and industry loans
    Question. The agency should be commended for its efforts in 
reducing the amount of outstanding principal delinquent and the 
percentage of borrowers delinquent within the business and industry 
loan guarantee program. What has contributed to this successful 
reduction?
    Answer. The staff in the field offices realize that this program is 
important to rural America only if we make successful loans and because 
of that the staff works very closely with the borrowers and lenders to 
ensure the loans are successful. This attitude in turn leads to better 
loan underwriting which has been improved through more intensive 
training. I am very proud of the staff, and I agree, they are to be 
commended.
                     cooperative development grants
    Question. For rural cooperative development grants, the fiscal year 
2000 budget request is $7 million, an increase of $3 million. How much 
of this additional funding will enhance technical assistance of small 
farmers and small farm operations in developing marketing and 
management skills? Is this assistance not available from the Extension 
Service?
    Answer. I cannot give a precise answer as to how much of the funds 
will be made available for developing marketing assistance and 
management skills. This is going to be one of my highest priorities and 
applicants for the grants will be so notified of that priority through 
the Federal Register. This is a very important area because the most 
glaring weakness in small business start-ups is in marketing their 
products and I am convinced it will be the same for cooperatives. The 
Cooperative Research Educational Extension Service (CREES) does offer 
some assistance to producers and we will continue to use the capacity 
of CREES where appropriate as we develop new research products.
                partnership technical assistance grants
    Question. Please discuss the need for a new earmark of up to $5 
million from the rural business and cooperative development programs 
for partnership technical assistance grants to rural communities.
    Answer. The majority of rural communities are dependent on part 
time public officials and voluntary help and they do not have the 
technical capacity to compete for Federal and State assistance that 
might be available to them. They consistently lose in the competition 
for such assistance even though their need may be greater. Our staff 
provides as much assistance as possible, but the need is far greater 
than we can meet. In order to get these communities to the front of the 
queue for such assistance we need to have available a source of funds 
through which we can help these communities develop the capacity to 
compete more successfully. I think we have demonstrated through the 
Empowerment Zone/Enterprise Community that once this capacity is 
available, the traditionally under served communities compete very 
well.
                    cooperative research agreements
    Question. How much funding is being used from the Salaries and 
Expense account in fiscal year 1998 and 1999 for cooperative related 
research through universities and other entities? Which universities 
and other entities are receiving this funding and how much is provided 
to each? When does the agency expect the research to be completed? How 
are the universities and other entities selected to conduct the 
research?
    Answer. I will submit a list of the research agreements awarded in 
fiscal year 1998 for the record. The amount used for cooperative 
agreements in 1998 was $1.9 million and approximately $1.3 million will 
be used in 1999. Most of this research at universities will be 
completed within 3 years from initiation of the project. The normal 
procedure used for executing these projects is that an announcement is 
posted in the Federal Register and applicants submit projects based on 
the areas suggested. Proposals are rated by the agency according to 
established criteria in the announcement and are awarded competitively 
according to ratings received. Universities and other entities 
receiving funding under the Research on Rural Cooperative Opportunities 
and Problems program in fiscal year 1998 were as follows:

------------------------------------------------------------------------
State          Institution                   Title              Amount
------------------------------------------------------------------------
  NJRutgers University           A Cooperative Approach to     $94,445
                                  the Development,
                                  Production, and
                                  Marketing of a Value
                                  Added Blueberry Product.
  IAIowa State University        Agricultural Development       57,342
                                  in the 21st Century: The
                                  Changing Role of
                                  Cooperatives.
  NYCornell University (with NE  The Role of Small-Scale        69,854
     Small Farm Institute)        Growers' Cooperatives in
                                  Sustaining Northeast
                                  Agriculture.
  MANE Small Farm Institute      The Role of Small-Scale        29,992
     (with Cornell University)    Growers' Cooperatives in
                                  Sustaining Northeast
                                  Agriculture.
  ARUniversity of Arkansas       A new Generation of            35,625
     School of Law                Farmer Co-Ops: Defining
                                  & Redefining What It
                                  Means to be a
                                  Cooperative.
  OROregon State University      Cooperatives' Export/          50,779
                                  Import Arrangements for
                                  High-Valued Products.
  MSMississippi State Univ       Role of Livestock              53,222
                                  Marketing Co-Ops in
                                  Southeast Cattle
                                  Production.
  INPurdue University            Opportunities for Locally      44,526
                                  Owned Multiplant Grain
                                  Cooperatives with
                                  Identity Preserved
                                  Grains.
  MOUniversity of Missouri       Redefining Ag Bargaining       44,526
                                  Co-Ops for the 21st
                                  Century: Solving the
                                  Free Rider problem.
  INPurdue University            Structural Change in           53,819
                                  Cooperatives and
                                  Agribusiness: What are
                                  the Opportunities and
                                  Implications for
                                  Producers?.
  CASan Joaquin College of Law   ``New Wave of Rural            48,750
                                  Agricultural
                                  Cooperatives.'' A
                                  Symposium Law Reviewed
                                  Issue.
  WIUniversity of Wisconsin      Cooperative Dairy              76,930
     (with Iowa State             Production Models: A
     University)                  Means for Rural
                                  Development.
  KYCenter for Sustainable       Six Decades of                 95,000
     Systems (with Univ. of KY,   Cooperation: A Living
     Commodity Growers Co-op, &   Legacy Nurturing New
     Natl. Farmers Union)         Cooperatives or A
                                  Culture ``Up in Smoke?''.
  KSKansas State University      Valuing Marketing Rights       86,330
                                  in New Generation
                                  Cooperatives.
  WAWashington State Univ        Financing Co-Ops Through       35,799
                                  Patron Demand Deposit
                                  Accounts: Future
                                  Prospects and Pitfalls.
  MSAlcorn State University      Economic Development in        94,297
                                  Rural Mississippi: What
                                  Is the Appropriate Role
                                  of Cooperatives?.
  SCSouth Carolina State Univ    Barriers to Small & New        68,890
                                  Farmer Membership in
                                  Agricultural Marketing
                                  Cooperatives in the
                                  Southeastern Region.
  NDNorth Dakota State Univ.     Assessment of Cooperative      40,185
     (with Univ of Wis. & Mont.   Board Training Programs
     State Univ.)                 and Needs and
                                  Development of Training
                                  Material.
  WIUniv. of Wis. Co-op Center   Assessment of Cooperative      31,680
     (with ND State Univ. &       Board Training Programs
     Mont. State Univ.)           and Needs and
                                  Development of Training
                                  Material.
  MTMont. State Univ. (with      Assessment of Cooperative      24,975
     Univ. of Wis. & ND State     Board Training Programs
     Univ.)                       and Needs and
                                  Development of Training
                                  Material.
  FLUniversity of Florida        Optimal Scheduling of          66,600
                                  Farm-to-Plant Milk.
  IAIowa State University        Group Action Lessons from      25,000
                                  the History of a
                                  National Farm
                                  Organization.
  IAIowa State University        Conferences on Rural Data      10,000
                                  Needs.
  WAWashington State Univ.       Capacity Utilization           15,000
                                  Issues for Washington
                                  State Cooperatives.
                                                           -------------
          TOTAL                                              1,920,021
------------------------------------------------------------------------

                        support services bureau
    Question. With the implementation of administrative convergence how 
much will Rural Development be expected to contribute to the Support 
Services Bureau? How will this affect each agency's salaries and 
expense budget?
    Answer. Mr. Chairman, preliminary estimates are that the Rural 
Development Mission Area would transfer about 1,070 staff in 
headquarters, St. Louis, and the States and the cost would be in the 
neighborhood of $73 million. Following reorganization of the Department 
and the creation of the Rural Development Mission Area, we consolidated 
the administrative functions and placed those functions under the 
umbrella of the Rural Housing Service with sources being provide to all 
three agencies. Hence the effect on the salaries and expense budget of 
the other two agencies should be minimal since the monies for 
administrative personnel and functions are currently transferred to the 
Rural Housing Service under the policy oversight of the Deputy Under 
Secretary for Operations and Management and day to day operational 
oversight of the Deputy Administrator for Operations and Management.
                         salaries and expenses
    Question. The fiscal year 2000 budget request proposes an increase 
of $25 million for the salaries and expenses account. How will this 
increase be used?
    Answer. The requested increase is for three items: one totaling $14 
million is pay cost increases composed of the annualization of the 
fiscal year 1999 pay increase and the increase anticipated for fiscal 
year 2000; another totaling $8 million is for improvements to our 
financial systems; and the third item is $2 million for a Housing Data 
Warehousing Initiative, the purpose of which is to improve loan 
origination, loan servicing, and loss mitigation by sharing information 
on loan portfolio management among the Federal Housing Administration, 
the Veterans Administration,, and the Government National Mortgage 
Association.
    Regarding the first item, I would like to note that since my tenure 
as Under Secretary, we have tightened our belt continually on items 
such as travel, training, and information technology to ensure we had 
sufficient funds to maintain our staffing level and not be forced into 
adverse actions such as reductions-in-force and furloughs. In doing so 
we reduced training to a very low level, and disrupted several 
financial management improvement projects. The increases requested must 
be provided to avoid reductions in force.
                            water and waste
    Question. What is the backlog of applications for the Water 2000 
initiative?
    Answer. We do not maintain a separate backlog of applications for 
the Water 2000 initiative, those applications are part of the total 
backlog for water and waste disposal loans and grants which total about 
$4 billion combined.
                       rcap unobligated balances
    Question. Please list the amount of obligated and unobligated 
balances from prior year appropriations for the rural utilities 
assistance program. Why will the unobligated balances not be available 
for future obligation for the Rural Community Advancement Program 
(RCAP)?
    Answer. Appropriations made to this account are made available 
until expended and any unobligated balance or future cancellation of 
obligated balances, other than those made appropriated for disaster 
recovery, are available for obligation for water and waste disposal 
loans or grants. Appropriations to the Rural Utilities Assistance 
program began in fiscal year 1996 and as of the end of fiscal year 1998 
the unobligated balances totaled $543,841 and the obligated balance 
totaled over $528 million. The totals for fiscal year 1997 for 
unobligated and obligated are $1,062,359 and $593,313,440, 
respectively. The totals for fiscal year 1997 include a small amount of 
funds made available for disaster assistance.
                electric and telecommunication programs
    Question. Why is the Department requesting greater flexibility to 
manage electric and telecommunication loan programs by allowing the 
budget authority to be interchangeable for those programs?
    Answer. Mr. Chairman, the demand for the loan programs, 
particularly the electric loan programs is increasing significantly, 
but it is not consistent from year to year for each of the programs. 
Having one source of budget authority for the electric programs, as 
opposed to three would enable the Administrator to adjust to demand 
annually and ensure the funds are used more effectively.
    Question. The budget justification notes that the fiscal year 2000 
requested lending levels for electric and telecommunication loans are 
justified to meet the Administration's goal to stimulate economic 
development and fulfill the variety of Administrative initiatives. What 
is the variety of Administration initiatives?
    Answer. Mr. Chairman, the infrastructure provided through these 
programs is a vital key to economic stability and economic development 
in rural areas. Infrastructure investment provides the foundation for 
new economic activity and economic stimulation is the basis for the 
enactment of the programs we administer.
                   rural economic development grants
    Question. The fiscal year 2000 budget proposes a decrease of $7 
million for rural economic development grants. At the proposed level, 
how many grants will be available? What will be the average grant 
amount?
    Answer. Mr. Chairman, the decrease results from the lack of funds 
in the ``Cushion of Credit'' account from which these grants are made. 
At the $7 million level requested, there would be as few as 20 grants 
made at an estimated average of $350,000 each.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                 rural electric and telephone programs
    Question. The funding for the Rural Utilities Service was cut by 
over $247 million, and within that agency, funding for 
telecommunications was cut by over $25 million. I have been a huge 
proponent of telecommunications in my home state of Montana. The Burns 
Telco center serves a large sector of the population of Montana. A cut 
like this can hurt telecommunications efforts immensely. How does USDA 
plan to restore funding to Rural Utilities?
    Answer. Senator Burns, I think there must be some confusion in the 
budget numbers that I hope I can clarify. You are correct that the 
funding requested for telecommunications loans is $25 million less than 
fiscal year 1999, but there is an increase in Rural Telephone Bank 
loans of $18 million so the net effect is about $7 million less for 
telecommunication loans. Such reductions are necessary if we are to 
remain within the budget caps agreed to in 1997 by the Congress and the 
Administration. The reduction in electric and telecommunication loans 
totals only $67 million, and for the Rural Utilities Service the budget 
request is $142 million higher than fiscal year 1999.
                              ez/ec grants
    Question. EZ/EC grants to states were cut by $15 million. These 
Rural Enterprise Zones and Rural Empowerment Communities are part of 
Vice-President Gore's empowerment zones. They are represented largely 
by Native Americans and enhance community development. How can the USDA 
justify this budget cut?
    Answer. Senator, again I think there may be some confusion caused 
by the manner in which the budget material is presented. In fiscal year 
1999, the $15 million for the rural Empowerment Zones and Enterprise 
Communities was part of the Agricultural Appropriations Act. However, 
for fiscal year 2000 the Administration is requesting $15 million in 
funding through the Social Security Block grant program, just as the 
first round of EZ/EC communities was funded. Our presentation of the 
budget reflects only that the funding will not be available through the 
Agriculture Appropriations Committees.
                   rural business-cooperative service
    Question. Rural Business-Cooperative Service was cut by $4.6 
million. How can the USDA justify this type of cut when Americans 
living in rural areas are currently in such a huge economic crisis?
    Answer. Senator, the budget request for the Rural Business-
Cooperative Service is an increase of $20 million in program level.
                         rural housing service
    Question. Rural Housing Service also suffered a huge budget cut. A 
decrease of $1.2 billion is proposed for fiscal year 2000. Again, 
people in rural areas cannot afford to have this important funding 
decreased. Montana is already at a disadvantage as the money is 
allocated to states based on a factor, which is based on population. 
Thus, those states with a low population, such as Montana, are not 
allocated nearly enough funding for the needs of their rural 
population. How will USDA replace funding for Rural Housing?
    Answer. Senator, again I do not know what is causing the confusion 
with the budget material, but the budget requested for rural housing is 
over $600 million higher than the amount appropriated for fiscal year 
1999. Regarding the allocation issue, the percent of rural population 
of a State is one of the factors used in allocating funds, and that 
factor is provided by the latest census information. We will be happy 
to look at the allocation formula to see if there is some adjustment 
that would be appropriate.
  alternative agricultural research and commercialization corporation
    Question. In last year's testimony it was projected that the 
Alternative Agricultural Research and Commercialization Corporation 
(AARCC) would recover $300,000 in repayments but in actuality received 
over $450,000, well ahead of the projected return on investment. For 
fiscal year 1999 it is projected that payments will total $1.7 million. 
How much money has been recovered to date? Do you expect the payments 
to surpass the projections again this year?
    Answer. The figures you state are correct, but are cumulative 
figures through the end of the fiscal year; i.e., the accumulated 
amount across all fiscal years since AARCC started operation in 1992. 
To date, repayments to the revolving fund total $840,120. Half way 
through this fiscal year, AARCC has received $389,204 in repayments and 
is on target to exceed its 1999 repayment plan of $800,000.
    Question. With a lower appropriation level than anticipated in the 
past and a higher return last year, how does this affect the business 
plan that has been laid out over the next five or six years?
    Answer. Long-term return on investment (ROI) has been affected. The 
ROI AARCC realizes today is generated by investments made five or six 
years ago. Future ROI will be affected by the deals done today. ROI in 
the outyears is expected to be less than anticipated in AARCC's 
business plan because reduced appropriations provided us with fewer 
funds to invest.
    Question. In your 10-year business plan and your 10-year strategic 
plan you do not anticipate appropriations after fiscal year 2002. Have 
the plans changed?
    Answer. No, AARCC anticipates no longer requiring appropriations 
beyond fiscal year 2002, provided we have sufficient ROI and 
appropriated income to continue to operate until then.
    Question. In the fiscal year 2000 budget request of $10 million, 
Secretary Thompson indicated that six new agriculturally based products 
will be created. Can you tell me what new products are to be brought to 
market, the location of the new industries, and the number of jobs 
associated with each industry?
    Answer. The job creation targets in AARCC's strategic and annual 
performance plans are projections based on past experience. AARCC data 
show that in the six years since inception, an average of one new job 
has been created for each $5,000 invested by AARCC. These new jobs are 
only possible because of the leveraging effect of AARCC investment 
capital, which has generated roughly $3.00 of private investment 
capital for every dollar invested by AARCC. Thus, it really takes a 
total investment of between $15,000-$20,000 to create one new job. With 
an appropriation of $10 million in fiscal year 2000, AARCC could 
anticipate helping to create 486 new jobs. The nature and location of 
the industries in which these jobs might appear depends on which 
proposals are approved for funding by AARCC's Board of Directors. If 
past trends continue, the demand for AARCC assistance will far outstrip 
the corporation's investment resources. In fiscal year 1998, AARCC 
project funding totaled $5.2 million; requests exceeded $27 million.
    Question. If the fiscal year 2000 budget request of $10 million is 
not appropriated, how would this affect the marketing of these new 
products?
    Answer. Existing portfolio companies would receive no additional 
assistance from AARCC in bringing new products to market, or in 
expanding their presence in the marketplace. In most cases, help from 
AARCC is the only outside assistance these companies can count on since 
traditional sources of credit are unavailable to them as start-up or 
development-stage companies seeking to commercialize new and unfamiliar 
products.
    Question. It has come to my attention that there tends to be three 
or four core companies that seem to be the most profitable. Please 
provide more about the companies that have the greatest return on 
investment.
    Answer. It is usually the case in venture capital funds that three 
or four key investments generate most of a portfolio's ROI. But this is 
judging ROI in strictly financial terms. Because AARCC has a broader 
mandate than private sector venture capital firms, the AARC 
Corporation's strategy considers much more than profit. In pursuing 
AARCC's investment strategy, no one variable--ROI, job creation, or 
agricultural material used--has priority. Investment decisions are made 
after weighing these three factors in order to maintain a balance in 
the portfolio. In judging AARCC's portfolio investments against these 
three factors, six companies appear to have made the greatest strides 
toward commercial levels of production. An overview of these six 
companies follows:
Automotive Lubricants from Vegetable Oil
    This company, in partnership with a Michigan oil seed growers 
cooperative and Michigan State University, recently formed a limited 
liability company (LLC) to begin the licensed production and sale of 
soy-based engine oil. A processing plant is tentatively scheduled to 
begin operation in 2-4 months.
    The engine oil is currently undergoing a battery of tests as part 
of certification program. Testing is being conducted according to 
American Petroleum Institute (API) standards and should be completed by 
the end of the year. Concurrently, the product is being tested as part 
of a motor pool fleet trial sponsored by the State of Michigan.
    The U.S. Navy has just completed the initial round of two-phased 
evaluation of the engine oil. The Phase I evaluation involved a year-
long cost comparison of the company's product, petroleum oil, and 
synthetic lubricants. Preliminary results from life cycle cost analyses 
show an annual cost savings of 10-15 percent versus petroleum-based 
motor oil. Cost savings compared to synthetic lubricants was 
considerably smaller, however. The Phase II evaluation will test 
product performance for environmental, safety, and health benefits as 
compared to petroleum based and synthetic products. Once both phases of 
the evaluation are complete, and provided satisfactory results are 
obtained, an implementation plan will be developed for service-wide 
adoption of the product in military motor pools.
Nutraceuticals from Corn Syrup
    Late last year this Minnesota-based company arranged with a 
contract fermentation company to toll-manufacture a dietary supplement 
product made from corn syrup. Two fermentations have been successfully 
completed following the company's patented purification process. Final 
product is ready for packaging and distribution.
    The company has signed and exclusive U.S. sales and distribution 
agreement with a major branded food products company and in January 
fulfilled its first substantial purchase order under the contract. A 
second purchase order has been received and is being filled.
    A marketing and public relations program is being developed to 
promote the benefits of the company's product to the neutraceutical 
industry. Additionally, a market research and consulting firm has been 
retained to consult on product positioning within the marketplace.
    By mid-summer, the company expects to officially introduce its 
dietary supplement product to the European market. For several months, 
the company has been in negotiations with a large food and 
nutraceutical ingredient manufacturer in The Netherlands over an 
exclusive sales and distribution agreement for Europe. Concurrently, 
the company has retained a Dutch regulatory consulting firm to manage 
its regulatory affairs in Europe. Documentation for European regulatory 
approval has been submitted and approval is expected by early summer.
Ethanol from Wood Waste and Energy Crops
    AARCC's first two rounds of investment helped this Arkansas company 
prove its biomass-to-ethanol conversion technology and helped fund the 
construction and initial operation of its Phase I pilot plant. The 
pilot plant demonstration was completed in September, using wood waste 
as the biomass feedstock. Processing costs have proven to be 
competitive with gasoline on a per gallon basis.
    Having demonstrated quantifiable production volume and costs, the 
company is now ready to pursue Phase II of its strategic plan--the 
construction of a semi-commercial production facility. AARCC's most 
recent round of investment provided the funds to complete a financing 
package (through USDA's Business & Industry Loan Guaranty program) and 
engineering feasibility study for the new facility, and to secure 
ethanol purchase agreements.
Commercial Applications for Milkweed (Syriaca) Floss
    For the first time in its eleven year history, this Nebraska 
company reported a positive net income in 1998. The company has built 
its business in two areas--Syriaca (Milkweed) processing, and milkweed 
floss comforters and pillows.
    1998 was a year of continued sales growth (12 percent) for the 
company. Comforters and pillows are sold primarily through catalog 
companies, however distribution has expanded recently to include 
mainstream retailers. The hypoallergenic properties of ground syriaca 
clusters have captured the interest of a cosmetics manufacturer, whose 
director of research & development recently visited the company to 
assess its capability to produce ground syriaca is sufficient 
quantities to meet its needs. Applications for syriaca oil are also 
being explored.
Citrus-based Household Cleaners and Solvents
    This Connecticut company manufactures cleaners and solvents derived 
from citrus peal and other natural materials. The company experienced a 
10 percent increase in sales in 1998 and is the only AARCC-funded 
company to receive a GSA contract following the USDA sponsored National 
Marketplace for the Environment trade show held in Washington in 
November 1997. The company is in the process of obtaining a Federal 
stock number.
    Last year, the company retained a New York City advertising agency 
to develop a new branded image and advertising campaign for its 
products. Focus groups were organized to obtain consumer feedback about 
product effectiveness and packaging. Changes are now being incorporated 
into the product line as a result. A series of infomercials are being 
developed for the Home Shopping Network and similar cable-access, and 
internet-based retailing operations.
Fiberboard furniture and flooring panels from soy straw
    Construction of this company's new, commercial scale fiberboard 
manufacturing facility in Mankato, Minnesota, is nearly complete. The 
company is scheduled to begin manufacturing operations on May 3 of this 
year. Upon start-up, the Mankato facility will be the lowest capital 
cost fiberboard plant operating in North America, with a cost per 
square foot of output that is almost half the industry average. The 
facility will be the only one of its kind capable of using multiple 
fiber sources with multiple resins to create a variety of panelized 
products. Of the plant's annual capacity of 45 million board feet, the 
company has received letters of intent from customers expressing an 
interest in purchasing an initial 48 million board feet.
    The company is being considered for a multi-million dollar 
investment by a group of investors interested in building an identical 
facility in California's rice-producing Sacramento Valley.
    Question. Are procedures in place to determine that investees use 
AARCC funds as they are intended and, if so, what are they? Have these 
procedures been delayed?
    Answer. AARCC is in the process of refining its internal control 
procedures with the help of an outside CPA firm. An updated set of 
internal control procedures is expected to be available by mid-summer.
    Question. It is required by the AARCC agreements and the investees 
that audited financial statements are to be submitted. Are there any 
policies or procedures for performing credit checks, background 
investigations, or gathering references concerning the investees?
    Answer. In its March 27-28, 1996, meeting, the AARCC Board of 
Directors made changes in the reporting requirements of companies 
receiving AARCC funds. The Board voted to require project update 
reports and financial reports to be submitted on an annual, instead of 
semi-annual basis. Also, the Board voted to require projects to have, 
as directed by the Board, a CPA audit to be conducted annually or an 
unaudited, signed financial statement prepared in accordance with 
Generally Accepted Accounting Principles (GAAP) and supplemented by 
corporate tax returns. AARCC has initiated a process of credit and 
background investigations on new and renewal applicants. This process 
relies on on-line credit information obtained through Dunn & Bradstreet 
business information reports and Experian credit reports.
    Question. Do you require disclosures by AARCC investees that may 
also do business with other companies that are affiliated with AARCC?
    Answer. AARCC's Board of Directors has approved a procedure as part 
of a recent investment approval, to assign responsibility back to the 
Board of Directors of AARCC-funded companies to annually review and 
certify that any non-arms-length transactions occurring among or 
between parent and/or subsidiary company(ies) are made at prices that 
do not disadvantage the company AARCC is invested in. These 
certifications must identify any non-arms-length transactions by type 
and amount, and the services rendered through the transaction. They 
must also identify the cost of those same services in an actual arms-
length transaction so as to demonstrate that such costs would have been 
equal or greater and that, consequently, the AARCC-funded company was 
not disadvantaged by the transaction.
    Question. Does AARCC have adequate control to assure that the 
Government receives the royalties and repayments that it is due? Please 
explain.
    Answer. In its March 27-28, 1996, meeting, the AARCC Board of 
Directors made changes in the reporting requirements of companies 
receiving AARCC funds. The Board voted to require projects to have, as 
directed by the Board, a CPA audit to be conducted annually or an 
unaudited, signed financial statement prepared in accordance with 
Generally Accepted Accounting Principles (GAAP) and supplemented by 
corporate tax returns. These documents are used to verify sales reports 
that are the basis for calculating royalties due to AARCC.
    During monitoring visits or phone calls, AARCC personnel try to 
obtain as much information as possible about the accounting and 
technical aspects of an investment. Information is gathered on how much 
AARCC money has been spent to date and what tasks from the company's 
own business plan have been accomplished with that money. Regarding the 
technical aspects of an investment, information is gathered about what 
is needed to make the project successful, what obstacles to success 
have arisen, what alternative approaches might be pursued, and what 
help AARCC might provide to move the project forward.
    Question. Is a security interest required on assets that are 
purchased with AARCC loan funds? Please explain.
    Answer. AARCC funds are typically used to make equity investments. 
AARCC purchases shares of stock in the companies it invests in. These 
companies in turn use the proceeds of the AARCC investment to purchase 
equipment that is then collateralized for working capital loans. This 
is exactly what AARCC intends for these companies to do. The value of 
AARCC's shares in the company is increased when AARCC funds are used to 
leverage additional working capital for the company.
    Question. Are there any instances that a project received more 
funds than requested? If so, why?
    Answer. Yes, there have been cases in which a project was funded at 
a level higher than that which was requested. This happens if AARCC's 
Board of Directors feels that an entrepreneur has underestimated that 
amount of capital required to commercialize his or her technology or 
product line. Given the broader experience of the Board members, they 
are often able to identify potential shortfalls in projected capital 
requirements. Most entrepreneurs are conservative in preparing their 
business plans, and it is our experience that they underestimate future 
expenses.
    Question. Do all grants that are submitted have to go through a 
competitive bidding process?
    Answer. Yes, as a rule grants must be competitively bid, but there 
are a few exceptions. Some grants have been awarded under AARCC's 
authority to support educational activities which promote the biobased 
economy. Occasionally, AARCC has provided grants to companies to enable 
their participation in trade shows or similar activities that enhance 
the profile of the company's products. In other instances, after an 
investment proposal has been reviewed and approved, a grant has been 
made to finance feasibility testing for a given product or technology 
on the condition that if the product or technology proves viable and 
can be successfully commercialized, the grant funds convert to a 
recoverable investment later on. In all cases, grant proposals are 
reviewed by the Due Diligence Committee of the AARCC Board of 
Directors.
                                 ______
                                 
               Animal and Plant Health Inspection Service
                 Questions Submitted by Senator Cochran
                   sterile fruit fly release program
    The fiscal year 2000 budget request proposes a $2.2 million 
increase for the fruit fly exclusion and detection program. Dr. Reed's 
statement indicates this money will be used to strengthened detection 
and control trapping activities in Florida and California.
    Question. How much funding has each state, Florida and California, 
received for the sterile medfly release program in fiscal year 1999?
    Answer. APHIS and the California Department of Food Agriculture 
(CDFA) operate a sterile Medfly Preventive Release Program (PRP) over a 
2,155-square mile area of Los Angeles, Orange, Riverside, and San 
Bernadino Counties. The PRP is designed to prevent the development of 
Medfly infestations and to limit the geographic size of any 
infestations that may manage to start. The PRP releases a minimum of 
125,000 sterile Medflies per square mile per week over the PRP zone. An 
additional 125,000 sterile Medflies per square mile per week is 
released over a high-risk area in central Los Angeles. Total program 
costs for fiscal year 1999 are estimated at $14.6 million which is 
shared equally between APHIS and the CDFA. APHIS' contribution of $7.3 
million is funded from annual appropriations in the fruit fly exclusion 
and detection line item.
    APHIS and the State of Florida are currently conducting an area-
wide sterile release program as part of the emergency eradication 
effort in Florida. The Florida sterile release program covers a 700-
square mile area that includes portions of Manatee, Sarasota, 
Hillsborough, and Dade Counties. APHIS' program costs are estimated to 
be $7 million in fiscal year 1999. The Agency has $5.1 million 
available from CCC emergency funds for fiscal year 1999 program costs.
    Question. How much do they get in the proposed fiscal year 2000 
budget for sterile medfly release programs?
    Answer. The proposed fiscal year 2000 budget includes $7.3 million 
to continue the ongoing PRP in California.
    Question. How successful has the release of sterile medflies been 
in addressing the outbreaks in California?
    Answer. Prior to the 1994 implementation of an area-wide sterile 
release program as part of a Medfly eradication program, the Los 
Angeles area experienced annual Medfly outbreaks. Since 1994, however, 
only 1 Medfly outbreak has occurred within the PRP boundaries which 
encompass 2,155-square miles in the Los Angeles basin area of 
California. Despite this outbreak, APHIS considers the PRP a very 
effective program for several reasons. First, the constant layer of 
sterile flies provided through the PRP helps limit the size and spread 
of any potential outbreak. Second, smaller scale outbreaks that do 
occur can be addressed using less intrusive control methods such as 
limited Malathion bait applications and increased sterile fly releases. 
The current California medfly outbreaks are located outside the PRP 
boundaries in Orange, San Diego, and Riverside Counties.
    Question. How much money is earmarked for trapping of the fruit fly 
in Florida and in California in the fiscal year 2000 budget request?
    Answer. The majority of the proposed $2.2 million increase--
approximately $1.9 million--is earmarked for the cooperative trapping 
program in Florida while approximately $334,000 of the increase would 
be used to enhance the cooperative trapping program in California.
                       malathion aerial spraying
    The Environmental Protection Agency (EPA) has told APHIS that the 
use of Malathion must be minimized.
    Question. Does EPA indicate how much Malathion the agency can use, 
if any? Should the agency not receive this additional funding, how will 
the agency reduce the use of Malathion?
    Answer. EPA has indicated that they would like the Agency to use 
Malathion only as a ``last resort'' especially aerial applications over 
urban areas. In October 1998, APHIS submitted to EPA an application for 
a quarantine exemption for the use of Malathion in certain fruit fly 
emergency situations. The application is pending.
    The additional funding would be used primarily to increase survey 
activities to national fruit fly trapping protocol levels. Early 
detection of outbreaks allows APHIS and cooperators more options in the 
selection of control actions, often eliminating the need for aerial 
applications of pesticides. Without an effective early detection 
system, APHIS and cooperators will not likely be able to reduce use of 
aerially-applied pesticides like Malathion.
    Question. What progress has been made to eliminate Malathion aerial 
sprays to control Medflies and other exotic fruit flies?
    Answer. APHIS in cooperation with Agricultural Research Service 
(ARS) and State scientists are developing alternatives to Malathion 
aerial sprays including more environmentally-acceptable chemicals. In 
April 1999, APHIS applied for a quarantine exemption for Spinosad, a 
``natural'' pesticide, which research indicates may achieve eradication 
when used in conjunction with sterile releases. Suredye, another more 
environmentally-acceptable pesticide, also shows promise and is being 
field tested in Guatemala and Hawaii.
    The public, however, will likely have concerns about aerial 
applications of any pesticide in urban areas. To address this concern, 
APHIS and cooperators continue to enhance the sterile insect release 
technology. New, more efficient male-only genetic strains were used in 
eradication programs for the first time in 1997 in Florida and in 1998 
in California. There have been positive preliminary results of tests of 
biocontrol agents in combination with sterile Medflies for Medfly 
control in Guatemala. However, additional development is needed before 
this technology is ready for program use. Also, APHIS is planning to 
modify and enhance our Waimanalo rearing facility to produce new 
genetic strains of Medfly and incorporate current and future advances 
in genetic transformations to control Medfly.
               fruit fly exclusion and detection--suredye
    Question. It is my understanding that USDA has evaluated a product 
called ``SureDye'' for use in Medfly Control. What is the status of 
these evaluations? Has the product been approved?
    Answer. USDA has evaluated several photoactive dyes for control of 
Medfly and other fruit flies. Various formulations of two of these 
dyes, phloxine B and uranine, have been sold under the trade name 
SureDye by PhotoDye International. These dyes are a promising potential 
alternative to Malathion for fruit fly control, but they have not yet 
been approved by the EPA which is responsible for pesticide 
registration.
    Question. Has the ARS evaluated this product?
    Answer. Yes. The Agricultural Research Service is very active in 
the development and evaluation of photoactive dyes for fruit fly 
control.
    Question. How would you describe APHIS' relationship with the 
manufacturer of ``SureDye,'' PhotoDye International?
    Answer. APHIS has been a client of PhotoDye International since 
1995 and has purchased SureDye for use in field trials.
    Question. Please compare the safety of ``SureDye'' versus other 
control methods. Is ``SureDye'' essentially the same product used as a 
food additive?
    Answer. Phloxine B and uranine, sold by PhotoDye International 
under the trade name SureDye, are available as dyes approved by the 
Food and Drug Administration (FDA) for cosmetics and pharmaceuticals. 
However, FDA approval does not imply that these products are safe for 
use as pesticides. The EPA is responsible for evaluating the risks of 
pesticides. EPA has not yet registered SureDye.
    Question. It is my understanding that APHIS conducted a very small 
test of the ``SureDye'' bait last fall. Please provide a brief summary 
of the test size, protocols used, and test results.
    Answer. In November 1998, APHIS conducted two tests in Guatemala 
using field cages. ARS developed the procedures for these tests to 
evaluate the efficacy of photoactive dyes under field conditions.
    The first test compared SureDye against Malathion and a nontoxic 
control. Each test consisted of 100 insects in a field cage with 30 ml 
of SureDye on a coffee bush. No additional food or water was provided 
for the test insects. Exposure to the SureDye began at 9 a.m. and 
mortality was measured every 2 hours until 4 p.m. and then again the 
next morning at 9 a.m. The test ran six replicates. The SureDye showed 
low percent kill when compared to Malathion and was only marginally 
better than the nontoxic control.
    A second test, using the same protocol, was conducted to compare 
the SureDye with previous formulations of photoactive dyes tested in 
Guatemala. This test confirmed the relative efficacy of the previous 
photoactive dye formulations and the lack of efficacy of the SureDye 
provided by PhotoDye International.
    Question. Describe the difference between an ``8-hour test 
protocol'' used by APHIS and a ``72-hour test protocol'' preferred by 
the makers of ``SureDye.'' Given the toxicity of Malathion, why is one 
test protocol preferred over the other?
    Answer. APHIS does not use an ``8-hour test protocol.'' In 
laboratory tests of photoactive dyes, the test insects are placed in 
small Plexiglas cages, provided food and water, exposed to measured 
amounts of photoactive dyes or other test pesticides, and observed for 
up to 72 hours. Photoactive dyes, unlike normal pesticides, can take 
much longer to kill the test insects. In the November 1998 tests, APHIS 
used a 24-hour field cage test developed by ARS to evaluate the 
efficacy of photoactive dyes in field conditions. Although observations 
in these cages were limited to the daytime periods between 8 a.m. and 4 
p.m., when light conditions are optimal, observations were made over a 
24 hour period. Observations did not extend beyond 24 hours due to the 
lack of alternative food or water for the test insects.
                              karnal bunt
    Question. Dr. Reed's statement indicates that over $33 million has 
been provided to mitigate producer and handler losses from Karnal bunt 
since the program began in March 1996. How much of this money has been 
distributed to Arizona wheat producers for their economic loss for the 
1997-1998 crop due to Karnal bunt? Have rules been published regarding 
the economic compensation of these farmers? If not, when do you expect 
them to be published? Why has the agency not submitted a plan for 
deregulation of Karnal bunt in Arizona as the Conference Report 
accompanying the fiscal year 1999 Appropriation Act directs?
    Answer. The $33 million figure does not include any payments for 
losses for the 1997-98 crop due to Karnal Bunt. The final rule will 
make compensation available to these farmers for the 1997-98 crop 
season and we expect this final rule to be published soon. Concerning 
deregulation, we submitted our initial plan on November 15, 1998, and 
continue to meet regularly with representatives of the Arizona wheat 
industry and Arizona regulatory agencies. For the 1999 harvest season, 
we have published a proposal in the Federal Register in which we would 
greatly reduce the size of the existing regulated areas and allow the 
planting of wheat in plowdown, traceback, and bunted kernel fields. We 
intend for a final rule based on that proposal to be published in time 
to provide relief for the crop that will be harvested in May, June, and 
July.
               accelerated pseudorabies eradication plan
    Question. It has been reported that by mid-January, USDA's 
accelerated pseudorabies eradication plan has had only 65 hog producers 
enroll totaling nearly 104,000 hogs. In mid-January, USDA reported that 
1.9 million head of hogs are infected with pseudorabies. Why has there 
been little enrollment in this eradication program? When do you expect 
that the sign-up for this program will be finished?
    Answer. As of April 9, 1999, 344 herds have been depopulated, 
involving 412,803 hogs. APHIS expects approximately 50 more producers 
to participate. Some producers chose not to enroll in the accelerated 
program because they are under contract with slaughtering plants to 
provide a certain number of hogs in a certain time period. Legislation 
in some States requires that their facilities be kept inactive for a 
period of 30 days following cleanup and disinfection. This requirement 
could interfere with their ability to fulfill their contract. These 
producers feel that breaking their current contracts may jeopardize 
their ability to secure such contracts in the future. Other producers' 
herds are close to pseudorabies-free because of the mandatory testing 
and removal standards developed by the cooperative APHIS/State/industry 
pseudorabies program. If only finishing hogs (which go to slaughter) 
and not breeding hogs are infected, they are reluctant to lose their 
investment in the genetics of their herds by participating in the 
accelerated eradication. They feel that their herds will soon be 
pseudorabies free without participation. Also, hog prices have risen 
since the original crisis, reducing the economic incentive for 
producers to participate in the voluntary program. Despite these 
obstacles, the accelerated program continues to reduce the number of 
known pseudorabies infected herds.
    Producers will be able to sign up for the accelerated eradication 
program until July 15, 1999. APHIS expects that the vast majority of 
producers who decide to participate will sign up by the end of April 
1999.
                    u.s.-panama screwworm commission
    Question. How is the Joint U.S.-Panama Commission for the 
Eradication of Screwworm funded?
    Answer. Eighty-five percent of the Joint Commission's funding comes 
from contributions made by the United States Government. The remaining 
15 percent is supported by contributions made by the government of 
Panama. In 1994, USDA signed an agreement with the Panama's Ministry of 
Agriculture and Livestock Development to create the Commission, to 
initiate operations in Panama, and to construct and operate a sterile 
fly facility to maintain a permanent biological barrier.
    Question. Will the U.S. cooperative share be funded through the 
APHIS budget?
    Answer. Yes. The U.S. share is funded through the APHIS screwworm 
line item.
        national farm animal identification and records project
    Question. What is the cost of each fiscal years 1999 and 2000 of 
the National Farm Animal Identification and Records (FAIR) pilot 
project? Which industry groups are working with APHIS on this pilot 
program? How were the States participating in this program chosen?
    Answer. APHIS is contributing $500,000 in fiscal year 1999 for the 
F.A.I.R. pilot project. A similar amount is projected for fiscal year 
2000. APHIS is working with the Holstein Association, the Dairy Herd 
Improvement Association, and the National Association of Animal 
Breeders on this pilot project. The project also has the support of the 
United States Animal Health Association and the Livestock Conservation 
Institute. The States of California, New York, Pennsylvania, and 
Wisconsin were chosen because of the significant dairy industries in 
these states and the ability of the states to control animal movements 
(through the use of limited slaughter markets and establishments).
                              brucellosis
    Question. How much additional funding is USDA and the Department of 
Interior (DOI) using to develop a safe and effective brucellosis 
vaccine for wildlife?
    Answer. For fiscal year 1999, APHIS expects to fund one brucella 
vaccine research study for $20,000. The study involves RB51 field 
trials in feral swine in South Carolina. APHIS is also aware of several 
ongoing ARS brucella vaccine research studies. The USDA and DOI are 
scheduled to meet in the last half of fiscal year 1999 to establish a 
consolidated approach to prioritizing and funding brucella vaccine 
research needs. In addition, ARS has included an increase of $1,000,000 
in the fiscal year 2000 President's budget to develop a vaccine for 
brucellosis in wildlife.
    Question. Please update the Committee regarding the construction 
and operation of the bison quarantine facility.
    Answer. Discussions are currently taking place between the State of 
Montana and APHIS regarding the location of the bison quarantine 
facility in Yellowstone. A final decision on the location is pending 
the outcome of the Environmental Impact Statement (EIS). The EIS 
includes seven separate alternatives for managing bison in the park. 
The National Park Service (NPS) is expected to make a final decision on 
the EIS in June 2000.
                           wildlife services
    Question. Dr. Reed's statement indicates that the gray wolf 
recovery program has succeeded beyond expectations. Is there a 
possibility of overpopulation? If yes, how is the agency addressing 
this problem?
    Answer. Gray wolf populations in the United States continue to 
expand. In August 1974, the Eastern Gray Wolf was classified as an 
endangered species. At the time, the Minnesota wolf population was 
estimated at 500-1,000 animals and occupied a range of approximately 
19,000 square miles. The Minnesota wolf population is increasing at an 
annual rate of 3 to 5 percent and expanding its range considerably. By 
1996, the population reached an estimated 2,200-2,300 wolves which had 
expanded their range to more than 39,000 square miles. APHIS' Wildlife 
Services (WS) verified 145 incidents of wolf predation on domestic 
animals in Minnesota in fiscal year 1998 and captured 166 wolves. 
Presently, the wolf population in Minnesota has reached such 
proportions that the U.S. Fish and Wildlife Service (FWS) is 
considering removing the wolf from the endangered species list.
    In Wisconsin, FWS may also remove the gray wolf from the endangered 
species list because the population is increasing to the point where 
the State Wildlife Agency is preparing management plans. WS 
investigated 32 complaints of wolf depredations in fiscal year 1998, an 
increase of almost 100 percent from fiscal year 1997, and captured 3 
animals.
    Gray wolves began moving back into northwestern Montana from Canada 
in the mid-1980s. This naturally occurring population of wolves is well 
established and its size has approached 100 animals at various times. 
Some wolves have been removed from the population after they repeatedly 
killed livestock. The population currently consists of about 45 
animals. In addition to this naturally occurring population, the FWS 
captured 29 wolves in Canada in 1995, 37 wolves in 1996, and released 
them into Yellowstone National Park and central Idaho. These wolves are 
considered nonessential experimental populations, and both are 
increasing. There are now well over 100 wolves in each area. In the 
next few years, the wolf population in the Northern Rockies area may 
also reach population levels that will warrant FWS consideration for 
removal from the endangered species list.
    Formal rules and plans direct that WS will deal with wolves that 
damage livestock. WS verifies wolf damage to livestock, captures 
depredating wolves as directed by the FWS, mediates conflicts between 
agencies and resource owners, disseminates information to the livestock 
community and the general public, and provides training to people who 
work with wolves that damage livestock.
    Wolf recovery in Montana and reintroduction into Idaho and Wyoming 
have impacted WS' ability to conduct routine livestock protection 
activities. Restrictions on the use of traditional methods of control 
where wolves may exist have hampered APHIS' ability to manage coyote 
damage to livestock. There has been a significant increase in work to 
verify potential cases of wolf predation and to deal with instances of 
confirmed wolf damage. The fiscal year 1999 Congressional directive of 
$175,000 did not include new money.
    In addition to this $175,000, another $72,000 is expected to be 
needed in fiscal year 1999 due to the increasing wolf populations in 
Montana, Idaho, and Wyoming, and related dispersal activities. A wolf 
from Idaho recently dispersed into Oregon, and its presence impacted WS 
ability to conduct routine wildlife damage management activities in 
that State. WS biologists expect more wolves to disperse from both the 
Idaho and Yellowstone recovery areas later this spring. Oregon 
livestock producers are concerned about their ability to protect their 
livestock. WS expects a significant increase in work load in Wyoming, 
Montana, Idaho, and Oregon associated with these dispersals.
    The presence of naturally occurring populations and introduced 
experimental populations in the same general area with the potential 
for intermixing also creates difficulty for livestock owners and WS 
field personnel. The damage management control for each of these 
populations is governed by different regulatory requirements; the 
inability for WS personnel to distinguish between these two populations 
may make it difficult to provide services to ranchers and farmers in 
the area.
    In Minnesota, where wolf control work is conducted solely with 
APHIS funding of about $250,000 per year, APHIS spent an additional 
$30,000 in fiscal year 1998, and total costs in this State are expected 
to be $380,000 in fiscal year 1999. In addition, wolf expansion into 
Wisconsin is projected to cost approximately $15,000 in fiscal year 
1999 due to increasing populations.
                             animal welfare
    Question. Please breakdown all costs associated with the 
implementation of the Animal Welfare Act. Please indicate shortfalls in 
this area?
    [The information follows:]

                        AWA Implementation Costs

Inspection Activities (Includes Travel Expenses)d]
    Dealer Inspections........................................$3,394,291
    Research Inspections...................................... 1,523,968
    Exhibitor Inspections..................................... 1,731,781
    Carrier/Handler Inspections...............................   277,085
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 6,927,125
                    ==============================================================
                    ____________________________________________________
    Licensing/Record Keeping..................................   619,313
                    ==============================================================
                    ____________________________________________________
Other Activities:
    Enforcement Action........................................   203,570
    Search Unlicensed/Unregistered............................    77,357
    Educational Services...................................... 1,347,635
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 1,628,562
                    ==============================================================
                    ____________________________________________________
      Total................................................... 9,175,000

    Since 1992, the Animal Welfare Act (AWA) appropriation has remained 
constant. Inspections to ensure minimal standards of care has declined 
from 17,764 in 1992 to 10,709 in 1998, without any reduction in the 
number of animals or number of animal sites (approximately 10,400) 
requiring inspection oversight.
    Every facility needs at least one annual inspection to ensure 
minimal standards are met and to remind the licensee/registrants of 
their responsibilities under the AWA. Past history suggests that over 
45 percent of the facilities will have some degree of noncompliance 
observed during an inspection, with some of these needing reinspection 
to ensure correction of problems that have, or are likely to have, a 
detrimental effect on the well-being of the animals. Several of the 
problem facilities may require up to 4 inspections per year just to 
ensure correction of life threatening situations. With 10,400 sites 
(7,773 facilities) to inspect, it is estimated that AC needs to conduct 
at least 17,120 inspections per year to ensure minimal standards of 
care.

Sites requiring one inspection................................    10,400
45 percent of the 10,400 sites will have violations and 
    require at least 1 more inspection. 10 percent of the 
    10,400 sites will require 2 or more inspections...........     6,720
                    --------------------------------------------------------------
                    ____________________________________________________

      Total number of inspections that should be conducted....    17,120

    With a current short fall of 6,411 inspections at an approximate 
cost of $551 per inspection, Animal Care needs an additional $3.5 
million to ensure minimal levels of animal well-being at the facilities 
currently regulated under the AWA.
    Question. How many inspectors are currently conducting inspections 
in fiscal year 1999?
    Answer. There are 69 inspectors in fiscal year 1999.
    Question. How many facilities are they inspecting per year?
    Answer. In fiscal year 1998, there were approximately 10,709 
compliance inspections and 1,579 pre-license inspections conducted at 
7,773 facilities.
    Question. How many facilities should be inspected at least 
annually?
    Answer. There are 7,773 facilities that APHIS should be conducting 
16,000 compliance inspections and 1,600 to 2,000 pre-license 
inspections per year. For maximum compliance, each facility should 
average two inspections per year. Facilities with greater number of 
violations need up to four inspections per year while those with no 
violations can be inspected every other year.
    Question. How many field inspectors are supported by the fiscal 
year 2000 proposed budget?
    Answer. The proposed fiscal year 2000 budget supports 69 field 
inspectors.
    Question. Should the agency rule that rats and mice bred for use in 
research and birds be treated like other animals, will more inspectors 
be needed to enforce the ruling?
    Answer. Yes, it is estimated that APHIS will need to hire an 
additional 34 veterinarians and 16 animal health technicians, to 
conduct inspections of facilities that deal with rats, mice, and birds.
                         swim with the dolphins
    Question. When does the agency expect to fully implement the 
provisions of the final rule regarding the swim-with-the-dolphin 
regulations?
    Answer. As a result of the continuing concerns expressed by several 
regulated parties over multiple components of the final rule to 
regulate human dolphin interactive programs, including wading programs, 
the Agency has initiated the process to suspend enforcement of the rule 
and solicit additional public comment prior to moving ahead with any 
new rulemaking for these programs.
                            horse protection
    Question. Please explain the modifications made to the current 
Horse Protection Strategic Plan after working with the six Horse 
Industry Officials.
    Answer. The Horse Protection Act (HPA) Operating Plan for the 1999 
Horse Show Season (Operating Plan) was issued on February 12, 1999, to 
expand on the procedures outlined in the Horse Protection Strategic 
Plan. The Operating Plan is organized into nine components and covers 
items such as APHIS and HIO responsibilities; certification of HIO 
designated qualified person (DQP) programs; inspections; compliance 
with 9 CFR 11.3 (the scar rule); HIO sanctions for HPA violations; 
conflict resolution; and regulatory changes.
    APHIS through the Strategic Plan transferred the initial 
enforcement responsibility to the various DQP programs. However in 
doing so, APHIS has not relinquished its authority for enforcing the 
HPA. APHIS will conduct inspections at HIO sanctioned events to 
determine whether or not the DQP's are successfully detecting sore 
horses and other violations of the Horse Protection Regulations. The 
HIO's will be responsible for demonstrating that the DQP programs are 
properly identifying these violations and applying appropriate 
penalties. APHIS will review, evaluate, and certify the DQP programs. 
Because confusion has arisen between the DQP programs and APHIS 
regarding the proper detection of violations of HPA based on 9 CFR 11.3 
(the scar rule), APHIS has also included procedures in the operating 
plan for the detection of noncompliance with the scar rule.
    Violations of the HPA and the regulations are under the 
jurisdiction of the Hearing Committee of each HIO. The Hearing 
Committee will enforce the schedule of penalties in the operation plan 
for violations. APHIS will encourage employees to resolve conflicts 
with DQPs at the local level. Disagreements that cannot be resolved at 
the local or regional level will be elevated to the HIO Chair or 
President and the APHIS Deputy Administrator for Animal Care. APHIS 
will provide a final decision to the HIO within 60 days.
    APHIS has asked each HIO to develop reasonable plans for 
eliminating scarring. If this cannot be accomplished, APHIS may 
consider proposing an amendment to 9 CFR 11.3 that would provide that 
any horse exhibiting active, visible bilateral evidence of abuse on any 
foot area above the hoof shall be deemed to be ``sore'' under the HPA. 
In this scenario, APHIS would exempt all horses born before 1998 that 
exhibit old scar tissue.
          national monitoring and residue analysis laboratory
    Question. Please list the other USDA agencies and entities with 
which the (National Monitoring and Residue Analysis Laboratory (NMRAL) 
in Gulfport, Mississippi does reimbursable work. Please list the 
reimbursements received by each. Will any other agency programs be 
located at this facility in Gulfport? If not, what will be done with 
the additional space available since relocation of agency employees to 
North Carolina has occurred? What amount of funding is proposed for 
fiscal year 2000 for NMRAL?
    Answer. This year at NMRAL, we expect to receive approximately 
$50,000 from the Boll Weevil Eradication Foundations for analyzing 
environmental samples for insecticides used in the eradication program. 
In addition, we expect to receive approximately $100,000 from the Farm 
Service Agency for analyzing samples from a variety of commodities and 
approximately $8,500 from the Agricultural Marketing Service for 
analyzing soybean samples. Our imported fire ant methods development 
program is conducted at the Gulfport facility as well. Also, we are 
currently evaluating the feasibility of increasing staffing in the 
methods development unit to perform work on agricultural quarantine 
inspection technology. Approximately $1.6 million is proposed for 
fiscal year 2000 for NMRAL.
                           aphis y2k systems
    Question. At the first of January APHIS reported that 2 systems, 
the Licensing of the Registration Information System and the Integrated 
Systems Upgrade Project, are behind in the Y2K government-wide goals. 
Please provide an update of the agency's activities to prepare these 
two systems for the year 2000.
    Answer. The Licensing and Registration Information System has been 
remediated, tested, and implemented in the three Regional Offices of 
the Animal Care Program. APHIS certified the system as Y2K compliant on 
March 31, 1999. The Integrated Systems Upgrade Project was certified as 
Y2K compliant on April 29, 1999. After reporting that these systems 
were falling behind schedule, the Agency allocated additional in-house 
and contractor resources to both efforts to accelerate progress.
                       safety of aphis personnel
    Question. In the 2000 budget request, how does the agency address 
the safety of personnel at state and field offices?
    Answer. APHIS has taken and continues to undertake a wide range of 
activities to address and ensure the safety of personnel at State and 
field offices. Safety is a serious matter for APHIS, in light of the 
event that occurred in Oklahoma City in 1985, in which APHIS lost seven 
employees, as well as several other incidents including fire bombings 
in Washington State, and office break-ins and takeovers in New Mexico 
and Arizona. In accordance with the Department of Justice (DOJ) report, 
Vulnerability Assessment of Federal Facilities, the APHIS National 
Security Program (NSP) team is surveying all APHIS offices to ascertain 
vulnerability risks, and to determine appropriate security measures for 
each existing location as well as future ones. To date, over 250 APHIS 
field offices have responded to the self-assessment survey which are 
being evaluated by the NSP team. The APHIS-NSP team is currently 
involved in several major agency wide projects including assisting in 
the development of an emergency management preparedness plan; an 
emergency management operations center; a workplace violence prevention 
program; an Agency-appointed bioterrorism coordinator, and an Agency-
wide Continuity of Operations plan.
              agricultural quarantine inspection user fees
    Question. What is the current balance of the Agricultural 
Quarantine Inspection user fee reserve program?
    Answer. The fiscal year 1999 beginning-of-year total balance of the 
Agricultural Quarantine Inspection user fee reserve account was $30.5 
million. Of this total, $14.7 million was unencumbered. However, 
current projections estimate an end-of-year unencumbered balance of 
$3.9 million for fiscal year 1999.
                            contingency fund
    Question. What is the current balance of the Contingency Fund?
    Answer. As of April 9, 1999, the balance of the Contingency Fund is 
$3,710,306.
                            johne's disease
    Question. What threat is Johne's Disease to the U.S. dairy cattle 
industry? How much funding in the fiscal year 2000 budget request is 
proposed for the establishment of a certification and control program 
for Johne's?
    Answer. Johne's disease is a contagious bacterial disease of the 
intestinal tract. The disease occurs in a wide variety of animals but 
most often in ruminants, especially dairy cattle. The risk to dairy 
cattle is high because the transmission of the disease favors the close 
quarters of the animals. Cattle infected with this disease usually 
develop diarrhea, rapid weight loss, and a loss in milk production. 
Johne's disease is estimated to cost dairy farmers $1.5 billion 
annually in reduced milk production. In northern States such as 
Minnesota, Michigan, New York, Ohio, Pennsylvania, and Wisconsin, it 
has been estimated that 30 percent of the dairy cattle herds are 
infected with this disease. The fiscal year 2000 President's budget 
includes $1.5 million for a Johne's disease certification and control 
program.
           national animal health emergency management system
    Question. Please outline the agency's proposal to create the 
national animal health emergency management system program and provide 
a breakdown of the fiscal year 2000 budget request of $1.2 million for 
this program.
    Answer. The proposed program is designed to enhance USDA's primary 
responsibility to protect the Nation's food supply and animal 
populations from disease events, both accidental or intentional, that 
could negatively impact the economic status of the food supply and/or 
the livestock and poultry industries.
    APHIS is requesting $1.2 million to develop an infrastructure to 
better position APHIS to provide the public and animal industry with a 
counter-terrorism force; developing disease detection and reporting 
systems; and promoting and strengthening partnerships with other 
Federal and State Agencies including the Federal Bureau of 
Investigation and the Federal Emergency Management Agency. 
Approximately $500,000 will be used to support 6 program positions. 
Another $300,000 will be used for systems development, software, and 
computer equipment. The remaining $400,000 will be used to conduct 
training courses on biological warfare and decontamination procedures 
and to provide funds for cooperative research efforts.
                        asian long-horned beetle
    Question. Will the fiscal year 2000 budget request of $2.1 million 
for the eradication program of the Asian Long-horned Beetle (ALB) be 
sufficient to meet the needs of the program in Chicago and New York? If 
this requested amount is not sufficient, how much additional funding is 
required?
    Answer. The $2.1 million request will certainly help us control 
this devastating pest and prevent its further spread. We expect to 
remove all known infected trees by May 1999. If no additional infected 
trees are found, this amount is likely to be sufficient.
                         invasive alien plants
    Question. What need is there for a new national rapid assessment 
and response system for invasive alien plants in the U.S. and how will 
the fiscal year 2000 budget request of $1.7 million be used to create 
this system?
    Answer. The development of a national early warning and rapid 
response system would be a critical component in our efforts to 
minimize the economic and ecological impacts of introduced invasive 
plants under the new presidential executive order on invasive species. 
In addition, it would be crucial to the establishment of an effective 
noxious weeds prevention and control strategy for the United States. We 
will use the $1.7 million increase to begin establishing a Federal 
Interagency Rapid Response Weed Team; an APHIS Regional Weed Team team 
to determine Agency priorities regarding weed prevention and 
eradication; State-level Interagency invasive species councils to 
establish invasive plant prevention, eradication, and management 
priorities in each State, as part of an overall State strategy for 
invasive species; and State Weed Detection and Reporting Networks in 
association with the State Councils. The extent to which the national 
early warning and rapid response system will be implemented in fiscal 
year 2000 will be based in large part on State cooperation in 
developing local, State, and Regional partnerships to facilitate 
interagency action on invasive species.
    Question. The Committee has consistently expressed concern about 
the growing problem associated with fish-eating birds which cause 
economic damages to farm-raising catfish operations. Please provide a 
detailed summary of the extent and scope of this problem, including the 
progress that is being made toward addressing the issues identified. 
Has the agency identified additional needs which are not currently 
being addressed, in terms of confronting bird depredation problems in 
the farm-raised catfish industry?
    Answer. Aquaculturists report that fish-eating birds cause 
significant economic losses, with some operations reporting one year 
losses in excess of $200,000. In the lower Mississippi Valley, 
cormorants cause losses of more than $17 million to catfish operations 
each year. With cormorant populations increasing throughout their range 
at the rate of approximately 8 percent per year, these losses can be 
expected to increase. Cormorants have also been found nesting in the 
lower Mississippi Valley, adding to the potential impacts to 
aquaculture operations.
    APHIS' Wildlife Services (WS) provides assistance to aquaculture 
producers in Alabama, Florida, and Mississippi. WS biologists conduct 
on-site evaluations to assess damage and make control equipment 
available to producers. If exclusionary and scaring techniques fail to 
reduce losses, producers may now take limited numbers of birds by 
lethal means under authority of a cormorant depredation order, 
developed by the Fish and Wildlife Service with WS cooperation. WS was 
an active participant in the roost dispersal program conducted to move 
roosting sites from producing areas to sites along the Mississippi 
River. Last year's efforts resulted in the dispersal of 70 percent of 
cormorants from catfish producing ponds.
    WS is aware of the need for increased wildlife damage assistance 
for catfish farmers in the southern United States and has a research 
field station in Starkville, Mississippi, which conducts studies to 
improve current control methods and develop new ones. Catfish 
production areas in southern Georgia and northern Florida are 
experiencing increased levels of depredation by fish-eating birds, 
including herons and egrets. Many of these production facilities are 
small farms and are unable to sustain heavy operating losses due to 
wildlife damage. Additional WS personnel are needed to establish an 
active presence and to provide on-site technical assistance and develop 
cormorant damage management plans.
    Question. The Committee believes that interagency coordination 
should increase between USFWS and APHIS. How can these two agencies 
address bird problems in a more orderly, effective, and ecologically 
responsible manner?
    Answer. A major step in the coordination between APHIS and FWS was 
the effort to develop and implement a cormorant depredation order, 
which provides a more effective and efficient method of allowing 
producers to implement control actions. Both Agencies cooperate on 
research studies on the ecology, behavior, food habits, and migratory 
patterns of various fish-eating birds, which includes ongoing surveys 
to determine population status and trends on fish-eating birds 
migrating and nesting in the Mississippi River valley. Further progress 
can be made by cooperating in the development and implementation of a 
cormorant management plan that includes cormorant population dynamics 
from the upper Great Lakes to the Gulf of Mexico and the relationship 
to cormorant population status and trends in the Northeast. APHIS will 
work with FWS in the northeast to identify areas that experience 
difficulties with fish-eating birds. A review of activities in the 
northeast should include a consideration of the possibility of 
expanding the current cormorant depredation order to include states 
beyond the Southeast.
    In addition, APHIS continues to provide technical and on-the-ground 
support to the public under the constraints imposed by the Migratory 
Bird Treaty Act. APHIS is currently working with FWS to streamline the 
resident Canada goose permitting process to assist our customers in 
receiving more efficient and cost effective support from FWS, which is 
the permitting Agency. APHIS provided FWS with information on damage 
caused by resident geese. FWS developed an environmental assessment and 
asked for public comment on a special purpose, resident Canada goose 
permit. Based on the results of this environmental analysis, FWS 
proposed a modification of permit regulations to allow a more liberal 
approach by State wildlife agencies for controlling resident goose 
damage. In the absence of a migratory bird permitting process for 
Federal agencies, APHIS continues to consult with FWS before 
implementing wildlife damage management control activities for resident 
Canada geese. In addition, APHIS continues to work with FWS on the 
development of a long-term, flyway based strategic plan for resident 
goose management which will address resident goose damage nationwide.
                              brucellosis
    Question. Last year the Department anticipated that all 50 states 
would reach a brucellosis Class ``Free'' status by the end of 1998. 
Have all 50 states achieved this status? Which states have not achieved 
this status? How have the bison carrying brucellosis which wander 
beyond the boundaries of the Yellowstone affected this goal?
    Answer. The established program goal was to have no affected herds 
and all states qualifying for Class Free status by the end of 1998. 
APHIS nearly reached this goal with only four affected cattle herds and 
one affected bison herd. In addition, 43 states had achieved Class Free 
status and 4 States (Florida, Kansas, Louisiana, and Oklahoma) were in 
the qualifying stage for Class Free status. The remaining three States, 
Missouri, South Dakota and Texas, were expected to be in the qualifying 
stage for Class Free status by the end of fiscal year 1999. Due to a 
newly affected herd being discovered in March 1999, the State of 
Oklahoma must reenter the qualifying stage and be disease free for one 
full year before they can reach Class Free status. The YNP bison have 
not affected this goal.
                  national poultry improvement program
    Question. How much does the fiscal year 2000 budget propose for the 
National Poultry Improvement Program? How does this compare to the 
fiscal year 1999 appropriated level?
    Answer. The budget request contains approximately $260,000 for the 
National Poultry Improvement Program. Funding for fiscal year 1999 is 
at a similar level.
                             biotechnology
    Question. How much is proposed in the fiscal year 2000 budget for 
the Biotechnology Products Regulatory Division of APHIS? Is this amount 
adequate to fulfill the unit's statutory responsibilities? How many new 
crop variety approvals did the agency approve in 1998? How many 
applications are estimated for approval in 1999?
    Answer. Our fiscal year 2000 budget request includes approximately 
$5 million for biotechnology regulatory activities. Although this 
amount should be adequate to fulfill our statutory responsibilities, an 
ever-increasing demand for our services will create significant 
challenges for us as we struggle to keep pace with the projected 
continuous, rapid growth of biotechnology in agriculture. In fiscal 
year 1998, we regulated the field testing of two new crop plant 
varieties and expect to regulate the introduction of four new varieties 
this year. The addition of four new plant varieties will bring the 
total number of different genetically modified varieties of plants 
field tested in the U.S. to 56. Of greater importance, though, is that 
we made 1,799 regulatory decisions on genetically engineered crops. 
Included in this figure is 1,073 release notifications and permits that 
we issued at over 5,000 sites nationwide. These release notifications 
and permits represent over 25 percent of all field releases ever made. 
Also in fiscal year 1998, we processed several more petitions for 
determination of regulatory status than in fiscal year 1997. Processing 
these petitions is the last USDA regulatory step for the 
commercialization of genetically modified crop plants. Adding to this 
increased workload is the ``determination extension process'', which 
will significantly increase the document handling workload by fiscal 
year 2000. This streamlined petitioning process involves deregulating 
an organism which is similar to but not identical to an organism that 
has previously been deregulated. To help fund our costs associated with 
the expected workload increase, we have proposed user fees in the 
amount of $5.36 million. This proposal is designed to achieve full cost 
recovery for our biotechnology activities associated with the 
permitting process, field inspections, and the increase proposed for 
the biotechnology permits unit. Since service being provided by this 
activity benefits a limited and clearly defined group of people, it is 
appropriate that they rather than the general taxpayer pay for these 
services through a user fee.
                    management and overhead expenses
    Question. APHIS does not receive a separate appropriation for its 
management and overhead expenses. How are these costs funded? Please 
provide an accounting of management and overhead expenses for fiscal 
year 1998.
    Answer. Because APHIS does not receive a separate appropriation for 
management and overhead expenses, funding for these costs are allocated 
to the various line items available to the agency, including 
appropriations, user fees, reimbursements, and trust fund receipts. As 
shown in the following table, management and overhead expenses totaled 
$77.7 million in fiscal year 1998, with total availability from all 
sources of approximately $613 million. APHIS' support costs fall into 
two categories: Agency support and program support. Agency support 
includes budget, finance, personnel, procurement, contracting, 
Congressional relations, public information, rulemaking, planning, 
policy development, program evaluation, civil rights enforcement and 
compliance, equal employment opportunity counseling, and Central 
Services which include National Safety and Health Council, headquarters 
security, labor, and copier maintenance services. Agency support costs 
are assessed to each budget line item on a proportional basis, except 
for the Information Systems Acquisition Project, the contingency fund, 
emergency transfers, and the Buildings and Facilities appropriation, 
which are exempted. Program support costs are funded by each individual 
unit from within its available funds, and may include regional offices 
in the field and an office of the Deputy Administrator and Resource 
Management Support at headquarters.

                                 MANAGEMENT AND OVERHEAD COSTS--FISCAL YEAR 1998
                                            [In thousands of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                      Program
                           Cost Center                            Agency Support      Support      Total funding
----------------------------------------------------------------------------------------------------------------
Plant health programs...........................................  ..............          17,881          17,881
Animal health programs..........................................  ..............          13,252          13,252
Wildlife Services...............................................  ..............           4,553           4,553
International Services..........................................  ..............           3,635           3,635
Animal Care.....................................................  ..............           1,574           1,574
Investigative and Enforcement Services..........................  ..............             783             783
Office of the Administrator Staff...............................           2,181  ..............           2,181
Civil rights Enforcement and Compliance.........................           1,138  ..............           1,138
Equal Opportunity Employment Counseling.........................             527  ..............             527
Information technology support..................................             167  ..............             167
Congressional relations and public information..................           3,445  ..............           3,445
Budget, finance, personnel, procurement, and contracting........          16,678  ..............          16,678
Employee development and training...............................           3,795           1,400           5,195
Policy, program planning and evaluation, regulatory support.....           5,510  ..............           5,510
Headquarters Central Services...................................           1,148  ..............           1,148
                                                                 -----------------------------------------------
    Total, APHIS................................................          34,589          43,078         77,667
----------------------------------------------------------------------------------------------------------------
Note: Excludes approximately $7.2 million in available funds and support costs performed for Agricultural
  Marketing Service and Grain Inspection and Packers and Stockyears Administration on a reimbursable basis.

                             pink bollworm
    The National Cotton Council, along with growers in Arizona, are 
proposing an eradication program for the pink bollworm to begin in 2000 
and complete in 2004. They are requesting an increase for APHIS of $5 
million over the fiscal year 1999 level to facilitate increased 
production of sterile moths at the Phoenix facility and to allow APHIS 
to provide important technical oversight of the program.
    Question. Why does the fiscal year 2000 President's budget not 
propose an increase to instigate a pink bollworm eradication program?
    Answer. Current budget constraints and more pressing program needs 
prevented us from doing so. However, we remain confident that this type 
of program can succeed, particularly with the increased use of Bt 
cotton, and may consider it again along with other program priorities.
    Question. Is this increase adequate to support the work that the 
National Cotton Council has proposed?
    Answer. A $5 million increase, together with contributions from 
cotton growers, would be adequate to support this work. Our 
contribution would represent 30 percent of the total projected first 
year costs and the growers' contribution would represent 70 percent.
    Question. Is it possible to eradicate the pink bollworm as they 
have proposed in their plan?
    Answer. Yes, it is. This strategy has yielded extremely promising 
results in smaller scale projects; we would expect similar results from 
an area-wide program.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                              brucellosis
    Question. The APHIS budget was cut by $9 million in the fiscal year 
2000 budget. APHIS is responsible for numerous important projects to 
the State of Montana. Funding for the brucellosis vaccine research is 
among those projects. Brucellosis remains a threat to the health and 
well-being of livestock in the bordering Yellowstone National Park 
(YNP). YNP will continue to serve as a reservoir for brucellosis unless 
it can be adequately managed or appropriate measures are taken. 
Considering that over 1.5 million people visit YNP annually and come 
into close proximity to wildlife and wildlife secretions, brucellosis 
poses an obvious threat not only to livestock and bison, but is also an 
issue of human biosafety. How does USDA expect to solve this problem 
when the APHIS budget is cut?
    Answer. One of APHIS' greatest achievements has been the success of 
the brucellosis program. Through cooperative efforts between Federal 
and State governments and industry and careful herd management, the 
last pockets of infection are being eliminated from domestic livestock. 
At the end of fiscal year 1998, only 8 herds remained under quarantine. 
As a result of this success, the Agency will be able to reduce disease 
management activities in domestic cattle in fiscal year 2000 including 
tracebacks, investigations, vaccinations, and depopulation. The 
reduction in the brucellosis management program should not impact the 
Agency's activities in YNP.
    As long as wildlife in YNP continues to serve as a reservoir for 
brucellosis, there will always be concern that the disease could be 
reintroduced in the country's livestock population. For this reason, 
APHIS will continue to conduct monitoring and surveillance activities 
from the Agency's animal health monitoring and surveillance program. 
This continued surveillance and testing will allow APHIS to detect and 
quickly eliminate the disease should it spread into the livestock 
population.
    Public health issues, including educating Park visitors to the 
threat of brucellosis, have been addressed in the Environmental Impact 
Statement (EIS). The EIS includes seven separate alternatives that 
could be implemented by the National Park Service (NPS) in the 
management of bison in YNP. Until a final decision is made on the EIS, 
APHIS' long-term role in managing brucellosis in YNP will remain 
undetermined.
                           wildlife services
    Question. APHIS also serves as the agency for Wildlife Services 
which is extremely important to livestock producers in the state of 
Montana. $175,000, which was earmarked for the purchase of a new 
helicopter for Wildlife Services, was cut out of the APHIS budget. How 
will USDA restore this valuable funding to Montana livestock producers 
depending on it for the welfare of their animals?
    Answer. The fiscal year 1999 Congressional directive of $175,000 
for wolf control in Montana was not accompanied with additional 
appropriated funds. APHIS is addressing the directive through a 
contingency fund release.
                                 ______
                                 
                     Agricultural Marketing Service
                 Questions Submitted by Senator Cochran
                         pesticide data program
    Question. The budget proposes an increase of $911,000 for the 
development of a program that monitors pesticide residues in meat, 
poultry, eggs and drinking water. Is this data collection currently 
conducted by any other federal agency? What jurisdiction or 
responsibility does USDA have to monitor drinking water? Why is this 
not done by the EPA? How does this program differ from the pesticide 
data program?
    Answer. The USDA's Food Safety and Inspection Service (FSIS) has 
regulatory authority over meat, poultry, and egg products. FSIS' 
compliance program is oriented towards enforcement of tolerances 
(maximum allowable pesticide residues in or on foods); therefore, their 
data, although appropriate for enforcement, have limited usefulness in 
population-based evaluations. FSIS' data are not statistically 
representative of the overall residue situation for a given slaughter 
class, pesticide, or region. Sampling for compliance programs is 
usually biased to take into account factors such as commodities or 
places of product origin with a history of violations. FSIS uses mostly 
multi-residue methods and no verification of findings is required 
unless a tolerance violation is suspected. These methods can detect 
pesticides at tolerance levels which in some cases are too high to be 
useful for accurate pesticide risk assessment.
    EPA requested monitoring data for drinking water. These data will 
be obtained by the Agricultural Marketing Service (AMS), under 
authority of the Agricultural Marketing Act of 1946, using the 
Pesticide Data Program (PDP). Currently available drinking water data 
are very limited and are collected through the EPA's Public Water 
System Supervision Program by delegated States and tribes. Limitations 
of these data include lack of consistency in sampling and testing 
protocols, and an extensive array of data reporting formats which make 
it difficult to compile or derive national estimates. The U.S. 
Geological Survey (USGS) collects data for ground and surface water but 
does not sample drinking water. USGS monitors vulnerable bodies of 
water in areas of intense agricultural production, such as the corn 
belt region. Both the EPA and USGS programs focus on monitoring for 
compliance with Maximum Contaminant Levels of various chemicals, 
including selected pesticides. These programs do not provide data for 
all pesticides needed by EPA's Office of Pesticide Programs to meet 
Food Quality Protection Act (FQPA) requirements that exposures through 
drinking water be included in dietary risk assessments. AMS is working 
with EPA to develop a sampling and testing program for drinking water 
on a national scale.
    If EPA does not have reliable residue values for food and water, 
they use assumptions or models which tend to overstate risk. PDP data 
have been of great value in providing sound data to EPA. This proposal 
would extend the PDP program to meat and water--important components of 
children's diets. Because FQPA requires EPA to consider all non-
occupational exposure in the establishment of tolerances, assumed high-
end exposures from meat, poultry, eggs, and drinking water can fill the 
``risk cup'' and leave little or no room for critical agricultural 
pesticide needs. Sound data and realistic assessments of exposure are 
critical for maintaining critical agricultural use of some pesticides.
    Because of the PDP experience, partnership with States, and 
existing infrastructure, adding to the scope of the current program is 
the most cost-effective way to generate the data needed to support 
agricultural pesticide needs.
    In contrast to existing data sources for drinking water, PDP uses 
statistically-reliable, unbiased random sampling procedures to provide 
objective and comprehensive residue data to produce national estimates 
of pesticide residues. PDP collects samples as close to point of 
consumption as possible. For water, samples would be collected at water 
treatment facilities. State population figures are used to assign the 
number of samples collected per month. This number is constant for each 
commodity if the commodity is available in the marketplace. Generally, 
at least 600 samples of a commodity are obtained in a year. PDP uses 
refined multi-residue methods capable of detecting levels much lower 
than tolerances. These methods are resource-intensive and require 
various steps to allow for detection of residues at trace levels and 
verification of positive results. All PDP data are supported by 
rigorous quality assurance (QA) and quality control (QC) procedures. 
Approximately 30 percent of the analytical resources are in the QA/QC 
system to provide data integrity and uniformity. PDP uses a uniform 
reporting system and requires strict adherence to data reporting 
procedures. PDP's database allows for remote data entry and electronic 
transmission of data, and can be queried to provide customized reports 
for EPA.
    AMS will modify PDP methods to incorporate meat, poultry, eggs, and 
drinking water, beginning with poultry. Analysis of these foods 
requires acquisition of equipment and new technologies, and 
reengineering of PDP's data system for processing of these data. These 
data will be provided to EPA and FSIS. EPA will use the data for FQPA 
risk assessments, and FSIS for mitigation and risk management 
activities. For the poultry program, AMS staff are working with FSIS 
personnel to develop procedures for sampling based on statistically-
reliable protocols, with FSIS assuming responsibility for the sampling, 
handling, and shipping portion of the program. The National 
Agricultural Statistics Service is providing the statistical 
consultation for this endeavor. Poultry was selected as the first of 
these products to monitor in fiscal year 2000. Meat and egg products 
will be introduced into the program in subsequent years.
    For the drinking water testing program, PDP is working with EPA to 
develop sampling and testing protocols to collect drinking water data 
on a national scale. Additional funds will be needed to begin sampling 
and analysis of drinking water. The estimated cost to accomplish this 
work is $2.0 million.
                      microbiological data program
    Question. The budget proposes an increase of $6,185,000 to initiate 
a microbiological data program for food-borne pathogens. Is this data 
collection currently conducted by any other federal agency? How is this 
program to be coordinated with other agencies involved in this program, 
especially the Food and Drug Administration? Are other agencies 
contributing to the cost of this program?
    Answer. Data collection of this magnitude and with statistical 
validity has not been conducted by any other Federal agency. At 
present, the Food and Drug Administration (FDA) is doing a survey of 10 
imported products, with the purpose of detecting those levels of 
contamination that might result from a failure to follow adequate Good 
Agricultural Practices and Food Manufacturing Practices. The purpose of 
the Microbiological Data Program is to perform a statistically valid 
assessment of the contamination level of raw produce available to the 
American consumer. The FDA will be informed of test results and has 
assigned a research supervisor to act as liaison to work with AMS on 
this project. The Centers for Disease Control and Prevention will also 
be informed of MDP's test results. The National Agricultural Statistics 
Service will contribute directly to the program by providing the 
statistically-reliable sampling plans and associated laboratory testing 
quality control measures. The Agricultural Research Service has 
expressed a desire to receive isolated cultures which can be tested for 
antibiotic resistance, and arrangements will be made with Federal or 
university laboratories to perform serotyping. No funds will be 
received from any other agency for the execution of this project.
                      summary of fees by activity
    Question. Dr. Figueroa's testimony indicates that 75 percent of AMS 
funding is derived from fees charged for services provided. Please 
provide an estimate of fees collected and disbursements by activity for 
fiscal years 1999 and 2000.
    Answer. AMS funding is approximately 72 percent user fee funded in 
fiscal year 1999. If the budget requests are approved, the percentage 
in fiscal year 2000 will be 68 percent. The following is a table 
reflecting the summary of fees by activity.

                                                               SUMMARY OF FEES BY ACTIVITY
                                                                 [Dollars in thousands]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Fiscal year                                         Fiscal year                                         Fiscal year
                                         1999                                                200                                                 2000
                                     unobligated     Earned      Percent      Program    unobligated     Earned      Percent      Program    unobligated
                                      beginning     revenue                 Obligations   beginning     revenue                 Obligations     ending
                                       balance                                             balance                                             balance
--------------------------------------------------------------------------------------------------------------------------------------------------------
User Fee...........................      $42,473      $60,730           25      $60,730      $42,473      $60,730           23      $60,730      $42,473
Trust Fund.........................       20,860      106,122           43      106,122       20,860      106,122           41      106,122       20,860
PACA \1\...........................        6,347        6,783            3        8,607        4,523        6,894            3        8,718        2,699
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ PACA = Perishable Agricultural Commodities Act Program.
 
Note: This table does not include reimbursements to appropriations of approximately $3.7 million which represents approximately 1 percent in both fiscal
  year 1999 and fiscal year 2000.

                     organic certification program
    Question. Dr. Figueroa's testimony also indicates that $770,000 is 
requested for final implementation of the National Organic Standards 
program. When will the final regulation be published? When will it 
become effective? What will the additional staff position be used to 
do? Will the completion of the final rule not allow shifting of staff 
responsibilities to accomplish these tasks?
    Answer. AMS staff has reviewed and analyzed the nearly 300,000 
comments which were submitted in response to the proposed rule and 
subsequent issue papers. Based on this input, a revised rule is being 
prepared. Development of a final rule will commence after the comments 
have been received and thoroughly analyzed. Once the final rule is 
published there is an 18-month period during which full implementation 
will occur.
    The additional position being requested is needed to augment 
existing staff. Functions which will be performed include assistance in 
developing international standards, accrediting both private and State 
certifying agents, determining equivalency of foreign programs, 
obtaining and disseminating relevant export data, monitoring State 
programs for compliance, developing a system to prevent fraudulent 
labeling, and extensive outreach efforts. While completion of the final 
rule will enable staff to shift responsibilities, it will not preclude 
the need for this additional staff position.
                                 ______
                                 
                  Question Submitted by Senator Burns
                 export funding and producer education
    Question. I am pleased that the Agricultural Marketing Service 
budget was increased by nearly $12 million. With the increase in 
funding for this important program, how will USDA utilize these funds 
for increases in exports and producer education for marketing?
    Answer. Some of the additional funding for Marketing Services will 
be used by the Microbiological Data Program to facilitate the global 
marketing of domestically produced fruits and vegetables. This program 
will provide information on the contamination level of fresh fruits and 
vegetables for domestic risk assessment which can be used by exporters 
to market these commodities.
    The Market News Program will use some of the additional funding to 
expand the number of foreign countries currently reported and to 
develop new reports on international trade and exports. Improving 
market awareness of conditions in the world market will increase export 
opportunities.
    The additional funding requested for Wholesale Market Development 
will enable a number of direct marketing initiatives to be implemented 
for small producers, including educational outreach efforts on issues 
such as improving product quality, diversifying products, expanding 
markets, and developing market strategies.
                                 ______
                                 

        Grain Inspection, Packers, and Stockyard Administration

                 Questions Submitted by Senator Cochran
    Question. Mr. Secretary, over the last few years we have heard a 
lot about the prices livestock producers have been receiving for their 
cattle and hogs. Many people have explained this situation as normal 
economic cycles in livestock production. Others have pointed to 
industry consolidation as the problem. Still others have claimed that 
country of origin labeling for meat and poultry products and mandatory 
price reporting of boxed beef would have provided relief. This 
committee has funded numerous GIPSA investigations into the meat 
packing industry. Can you share with the committee what the results of 
these investigations have yielded? Would mandatory country of origin 
labeling or mandatory price reporting have prevented these fluctuations 
in prices? Do you have additional studies underway? If so, please 
describe their focus and cost.
    Answer. In addition to the Concentration study, GIPSA has used 
additional funds provided by this committee to fund a cooperative 
agreement with prominent economists from the University of Nebraska and 
Iowa State University to complete an econometric study of the data 
obtained in the Texas panhandle investigation. That study, as well as 
the investigation itself is currently undergoing professional peer 
review. Funds have also been used to recruit and hire additional 
economists for the regional offices and hire investigators with legal 
expertise, to undertake more complex investigations. These hiring 
efforts have allowed GIPSA to respond quickly to complaints of 
anticompetitive behavior, such as a recently completed investigation of 
a feedyard boycott that is likely to result in further action, as well 
as a complaint issued by GIPSA against Excel Corporation alleging 
unfair and deceptive pricing practices in the procurement of carcass 
merit hogs. GIPSA will continue to investigate and monitor all aspects 
of the livestock industry. Current efforts underway include follow up 
work from the Texas Panhandle investigation for cattle as well as a 
plant closing investigation and a comprehensive review of current 
procurement contracts for hogs. Additionally, the Department is 
conducting a study on mandatory country of origin labeling and has a 
legislative proposal on mandatory price reporting and will be reporting 
on both issues to Congress.
    Question. Can you provide the committee with the status of the 
GIPSA price reporting investigation of the meat packing industry 
mandated by Public Law 105-277?
    Answer. A framework for conducting the Congressionally mandated 
price reporting pilot investigation has been developed by GIPSA. 
Project options that can be completed with the available funding have 
been identified. The anticipated date for commencing with the 
information collection is May 1, 1999.
    Question. Public Law 105-277 also directed the Department to 
conduct a study on the effects of mandatory country of origin labeling 
for meat and poultry products. Can you share with the Committee the 
status of that study? Who in the department is conducting the study and 
when can we anticipate seeing the final report?
    Answer. The Conference Report of the Omnibus Appropriations Bill 
directed the Secretary to conduct a comprehensive study on the 
potential effects of mandatory country of origin labeling of imported 
fresh muscle cuts of beef and lamb. The Food Safety and Inspection 
Service (FSIS) of USDA is preparing this report. The report is expected 
to address the impact of such requirements on imports, exports, 
livestock producers, consumers, processors, packers, distributors, and 
grocers. The report is also to address any additional costs to the 
federal government which would be incurred as a result of mandatory 
country of origin labeling of imported fresh muscle cuts of beef and 
lamb.
    Question. Recommendation B. 15 of USDA's Advisory Committee on 
Agricultural Concentration calls for the reporting of more timely and 
accurate trade data. Public Law 105-277 provided clear direction to the 
Department to move forward and develop an electronic export 
certification reporting system. It is believed that such a system would 
provide important trade information to producers within a matter of one 
or two weeks instead of the current three-month delay. Can you share 
with the committee the development status of this electronic export 
certificate program.
    Answer. Public Law 105-277 provides for a pilot investigation of a 
``streamlined eletronic system for collecting export data, in the least 
intrusive manner possible'' for meat products. We understand that 
representatives of the U.S. meat industry are working to clarify their 
needs regarding price and export data reporting. Once these 
consultations between the producers and packers have concluded and we 
have their recommendations, we will reevaluate our work to ensure we 
develop systems compatible with the guidance provided by Congress.
    Question. Farmers across the South were plagued with significant 
infestation of aflatoxin in the 1998 corn crop. What testing capability 
does GIPSA have for aflatoxin? Farmers were also plagued with 
inconsistent testing. Does GIPSA set standards for aflatoxin testing? 
Does GIPSA have the authority to do so? What funds are included in the 
budget request or would be required to establish such a program?
    Answer. GIPSA provides aflatoxin testing service as official 
criteria for corn, sorghum, wheat, and soybeans, as official criteria 
under the Unites States Grain Standards Act (USGSA). Testing is also 
provided for rice, popcorn, corn meal, corn gluten meal, corn/soy 
blend, and other processed products governed by the Agricultural 
Marketing Act (AMA). Additionally, all corn exported from the United 
States is required to be tested for aflatoxin. Aflatoxin testing 
services are available nationwide, upon request and for a fee, as 
either a qualitative (screening above or below a threshold determined 
by the customer) or as a quantitative (actual results in parts per 
billion) service using several different types of test kits approved by 
GIPSA. The GIPSA approved test kits use enzyme linked immunosorbent 
assay (ELISA), monoclonal antibody affinity chromatography, or 
fluorescence technology. To further assist the grain industry, GIPSA 
also provides, on a limited basis, a complex chemical testing method, 
High Pressure Liquid Chromatography (HPLC) testing for aflatoxin. All 
official aflatoxin testing is performed as prescribed in the GIPSA 
directive by authorized employees of GIPSA or licensed delegated/
designated agency personnel.
    GIPSA has established sampling and testing procedures for GIPSA and 
official agency personnel to follow for aflatoxin testing. Official 
personnel receive extensive training on the official procedures and 
must be authorized or licensed by GIPSA to perform aflatoxin testing. 
Other inspection laboratories and commercial businesses that measure 
aflatoxin levels in corn may or may not follow GIPSA procedures.
    In addition to the official mycotoxin training and testing program, 
GIPSA has a program in place to evaluate equipment used in the official 
system. Test kits used in the official system must meet certain GIPSA 
specifications and pass a rigorous testing program. Test kits sold for 
commercial use in the United States are not regulated by USDA, 
therefore do not require GIPSA approval. Commercial businesses may or 
may not use GIPSA approved test kits.
    GIPSA has the authority to set standards for aflatoxin testing only 
in the official inspection system.
    Aflatoxin testing represents a user fee service under the 
Inspection and Weighing Program. In essence, revenue for this service 
is generated from fees charged by GIPSA and no additional funds are 
required to be appropriated.
    Question. Please distinguish between the roles of GIPSA and the 
Justice Department in investigating competitive practices.
    Answer. GIPSA has responsibility for enforcing the Packers & 
Stockyards (P&S) Act, including investigating competitive practices, 
trade practices and ensuring financial protection for producers in the 
livestock industry. The Justice Department, along with the Federal 
Trade Commission, has primary responsibility for enforcing the 
antitrust statutes, including the Sherman Act and the Clayton Act. 
GIPSA has a close working relationship with both of these agencies on 
matters of mutual interest and expects that relationship will continue. 
During the course of a GIPSA investigation, if it is determined that 
the conduct being investigated may be criminally prosecuted, the 
investigation is referred to the Justice Department, with GIPSA 
providing information and assistance, as required.
    The Department of Justice has primary responsibility for mergers 
and acquisitions but has generally looked to GIPSA for broad industry 
information and concentration ratios. GIPSA has generally investigated 
most complaints alleging anticompetitive practices in the meat packing 
industry.
    Question. Increased funding has been provided to GIPSA over the 
past few fiscal years to carry out recommendations of the Agricultural 
Concentration Committee. Please provide a detailed accounting for each 
of fiscal years 1997, 1998, and 1999 on the use of these funds. How 
will the increased funding requested for fiscal year 2000 be used?
    Answer. For fiscal year 1997, GIPSA received $800,000 of additional 
funding to increase investigations of deceptive and fraudulent 
practices that affect the movement and price of meat animals and their 
products, and for increased analysis of industry structure and 
performance to monitor the competitive implications of behavioral 
practices in the meat packing industry and to support legal actions 
that require complex economic and statistical analysis.
    During that year, GIPSA completed a comprehensive investigation of 
the procurement of slaughter cows in the Northwest region of the 
country and began a broad investigation of fed cattle procurement in 
the Texas panhandle. It also began conducting an investigation of 
slaughter hog procurement in the Central United States, and began an 
investigation involving slaughter lamb procurement in the Western 
United States. GIPSA also entered into cooperative research agreements 
to examine the effects of meat packing concentration on prices paid for 
fed cattle.
    During fiscal year 1997, GIPSA began planning the restructuring of 
its P&S program areas to strengthen its ability to investigate industry 
structure and competitive practice issues, and to provide greater 
flexibility and efficiency in enforcing the trade practice and payment 
provisions of the P&S Act.
    For fiscal year 1998, GIPSA received $800,000 of additional funds 
to recruit and integrate more economic, statistical, and legal 
expertise into investigative units that will conduct investigations 
involving anticompetitive practices. It also requested additional 
funding to increase its poultry compliance activities but none were 
appropriated.
    During fiscal year 1998, GIPSA began the reorganization of P&S by 
consolidating and strengthening its field offices and by reorganizing 
its headquarters staff. P&S hired new economists and legal specialists 
for its Denver and Des Moines field offices and additional economists 
for its headquarters staff. It established a toll-free complaint hot 
line for producers and the public to file complaints and report market 
abuse. GIPSA began planning a peer review process for major 
investigations that will evaluate whether GIPSA asked the right 
questions, collected the right data, and conducted sound analyses using 
appropriate models. The Agency also completed or continued the 
investigations begun in fiscal year 1997 into procurement practices in 
the fed steer and heifer, cow, hog, and lamb markets, and conducted 
numerous investigations of live poultry dealers.
    For fiscal year 1999, GIPSA received $397,000 of increased funding 
to increase staffing to pursue more aggressively and more 
comprehensively investigations into anticompetitive practices related 
to industry concentration without this work coming at the expense of 
its programs designed to protect individual producers from unfair 
practices and provide financial protection. In addition, GIPSA received 
$2.5 million to complete the restructuring of the P&S program.
    During fiscal year 1999, GIPSA has continued to hire economists and 
legal specialists for its field offices and headquarters staff. It has 
also initiated the investigation peer review process, and the peer 
review panel is examining the investigations of fed cattle procurement 
in the Texas panhandle conducted by GIPSA staff and by cooperative 
university researchers. The funds received for reorganization are being 
used to relocate employees who are being displaced as a result of the 
reorganization. The increased funding and personnel are also being used 
to continue major investigations of potential anticompetitive 
procurement practices and detailed analyses of the slaughter steer and 
heifer, slaughter cow, slaughter hog, and slaughter lamb markets.
    The requested budget increase of $1,386,000 for fiscal year 2000 is 
critical in expanding the Agency's capability to monitor and 
investigate the competitive implications of structural changes and 
behavioral practices in the meat packing and poultry industries. The 
Advisory Committee on Concentration recommended increased monitoring 
and enforcement of antitrust and regulatory policy and, specifically 
the antitrust enforcement of current regulations under the Packers and 
Stockyards Act be stepped up.
    Question. Fiscal year 1999 funding of $2.5 million has been made 
available for one-time relocation costs associated with the 
restructuring the Packers and Stockyards Administration. Please give 
the Committee an update on the restructuring of the Administration and 
the use of these funds.
    Answer. The three new regional offices have been established at 
Denver, Colorado; Des Moines, Iowa; and Atlanta Georgia, and all field 
employees now report to one of these offices. We are still in the 
process of relocating employees to the new regional offices and are 
positioning resident agents in outlying locations where they will 
conduct compliance investigations and provide routine services from 
home-based offices or one of three suboffices. The funds are being used 
for employee relocation; outplacement services; severance pay; 
equipment transfer and office setup; and to hire additional economists 
and other staff to conduct investigations of potential anticompetitive 
behavior in the cattle and hog industries. We expect our restructuring 
to be completed by June 1999.
                                 ______
                                 
                  Question Submitted by Senator Burns
    Question. The budget cut for funding of GIPSA was cut by nearly 
$18.5 million. Currently, four packers control nearly 80 percent of the 
meat market. Livestock producers have no transparency in the market and 
not enough avenues to market their commodity. The grain industry is 
also highly consolidated and the effects of this concentration is 
hurting farmers immeasurably. Mergers and concentration within the 
agricultural industry play a huge role in the demise of farmers and 
ranchers. At a time when the agricultural economy is at a 30 year low, 
How does USDA justify cutting the budget of GIPSA, the agency 
responsible for monitoring the actions of packing and grain companies?
    Answer. The President has requested authority for GIPSA to collect 
licensing fees to recover the cost of administering the P&S Act and for 
Standardization Activities under the United States Grain Standards Act 
in lieu of appropriated funding. The proposal would amend the P&S Act 
to provide authority to collect license fees to cover the cost of the 
program. It would also provide authority to initiate user fees for 
standardization activities including the developing, reviewing, and 
maintaining of official U. S. Grain standards used by the entire grain 
industry. Converting to license and user fees is consistent with the 
Administration's overall effort to shift funding for programs to the 
beneficiaries of such programs.
                                 ______
                                 
                 Questions Submitted by Senator Cochran
    Question. The fiscal year 1999 Senate report indicates that the 
Committee expects the Secretary to use his authority to collect, 
assimilate, and make available information regarding the boll weevil 
eradication program to agencies and entities that use this information 
concerning acreage planted to cotton. Has the Secretary made this 
information available? If not, why?
    Answer. We are aware of the Senate language. However, OMB has not 
approved the collection of land use information for FSA. Because the 
collection information for bollweevil eradication and other areawide 
pest control programs is not legislatively mandated, OMB considers this 
is a voluntary submission by producers.
    Question. The fiscal year 1999 appropriations act blocks the 
availability of the $60 million available for the Fund for Rural 
America for fiscal year 1999. Since these funds are available for two 
years, the fiscal year 2000 budget restores these fiscal year 1999 
funds and then proposed to block their availability in fiscal year 2000 
but to restore $60 million in annual increments beginning in fiscal 
year 2001.
    Since the Administration did not support the action taken by 
Congress to block the availability of fiscal year 1999 funding for the 
Fund for Rural America, is the budget proposal to block these funds the 
second year and restore them in increments in the outyears simple one 
to offset discretionary spending.
    Answer. The proposal to make fiscal year 1999 funding for the Fund 
for Rural American available in the years after fiscal year 2000 was 
one of several budget proposals used to ensure that the Department met 
its tight discretionary budget target for fiscal year 2000.
    Question. Of the fiscal year 1997 funding for the Fund for Rural 
America, the budget indicates that $26.1 million was allocated for the 
``core initiative,'' $7.8 million for the secretary's initiative and 
$2.2 million for Telecommunications Infrastructure Research. For each 
of these categories, please provide a description of each project/grant 
funded, the amount of funds allocated to it, a brief description of the 
project, who carried out the work, and an evaluation of benefits of the 
work undertaken.
    Answer. A description of the project funded by the Fund for Rural 
American of CSREES is provided to the subcommittee. Because the grants 
were made in the past 12-18 months, and the nature of the projects 
involved, it is too soon to provide an evaluation of the benefits of 
the work undertaken. It is expected that CSREES will be able to 
initiate assessment of impacts at the end of fiscal year 2000. Some 
assessment may occur prior to that time from annual reports that are 
submitted for each project, and the first set of annual reports was 
just recently received.
    [The information follows:]

                         Fund For Rural America

Core Initiative.........................................     $22,659,800
Secretary's Initiative..................................       5,471,000
Agriculture Telecommunications..........................       2,112,000
Planning Grants.........................................         886,900
Center Grant............................................       1,585,026
                    --------------------------------------------------------
                    ____________________________________________________
      Subtotal, Grants Awarded..........................      33,714,726
Federal Administration..................................       1,444,000
Small Business Innovation Research......................         453,600
Peer Panels.............................................         487,674
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      36,100,000
                   secretary's farmworker initiative
    Question. What is the ``Secretary's Farmworker Initiative?''
    Answer. The Secretary's Farmworker Initiative is to establish a 
Farmer/Rancher Coordinator position to develop policy, establish 
relationships with community-based farm work organizations, and develop 
and participate in the development of initiatives with other Federal 
agencies and non-Government organizations. Recent examples of improving 
conditions for farmworkers have been to (a) partnership with the 
Department of Labor (DOL), Migrant and Seasonal Labor, (b) exchange 
models for DOL ONE STOP and USDA Service Centers for purpose of 
including farm workers in programs or services which are going to be 
provided by both Federal Agencies, (c) partnership with Health and 
Human Services (HHS) to explore health service for migrant workers 
through the USDA Rural Housing Service program, (d) meet with Farm 
Worker organizations in the Northeast corridor from New Jersey to 
Florida to identify program needs of the farm workers, and (e) creating 
working relations with the National Farm Worker unions UAW and FLOC.
    Question. Please list, by USDA agency and appropriations account/
activity, the funds available for fiscal year 1999 and requested in the 
fiscal year 2000 budget to implement the following: (1) the Civil 
Rights Action Team (CRAT) report; (2) the National Commission on Small 
Farms Report, (3) the Secretary's Farmworker Initiative; (4) the Global 
Change Research Program; (5) the Clean Water Action Plan; (6) the Debt 
for Nature initiative; and (7) the Climate Change Technology 
Initiative.
    [The information follows:]

                [Budget Authority in millions of dollars]
------------------------------------------------------------------------
                                              Fiscal year
                                                  1999       Fiscal year
                  Program                    appropriation   2000 budget
                                                   BA            BA
------------------------------------------------------------------------
    SECRETARY'S CIVIL RIGHTS INITIATIVE
 
DEPARTMENTAL ADMINISTRATION:
    Fund Civil Rights Activities, including         $17.8         $21.1
     Office of Outreach....................
    Grants & Cooperative Agreements to                3.0          10.0
     improve Outreach to USDA customers &
     socially disadvantaged farmers &
     ranchers..............................
                                            ----------------------------
        Subtotal, DA.......................          20.8          31.1
                                            ============================
OFFICE OF THE GENERAL COUNSEL: Civil Rights           0.9           0.9
 Division..................................
                                            ============================
COOPERATIVE STATE RESEARCH, EDUCATION AND
 EXTENSION SERVICE:
    Fund Small Farms Initiative............  .............          4.0
    Address Disparities in Funding of
     Institutions of Higher Ed:
        1890 Facilities Programs...........           8.4          12.0
        Extension Services at 1994                    2.1           3.5
         Institutions......................
        Research at 1994 Institutions......  .............          0.7
        Hispanic Serving Institutions                 2.9           3.2
         Education Grants..................
    Increase Extension Indian Reservation             1.7           5.0
     Program...............................
    Pesticide Applicator Training..........  .............          1 5
                                            ----------------------------
      Subtotal, CSREES.....................          15.1          29.9
                                            ============================
FARM SERVICE AGENCY:
    Farm Ownership & Farm Operating Loans:
        Farm Ownership.....................          12.8           4.8
            Loan Level.....................         (85.6)       (128.0)
        Farm Operating.....................          50.1          29.3
            Loan Level.....................        (733.8)       (500.0)
    Farm Labor Housing Program:
        Farm Labor Housing Loans...........          10.4          11.3
            Loan Level.....................         (20.0)        (25.0)
        Farm Labor Housing Grant Level.....          11.4          15.0
        Rural Rental Assistance Payments...          10.0          15.0
                                            ----------------------------
          Subtotal, FSA....................          94.7          75.4
                                            ============================
NATIONAL AGRICULTURAL STATISTICS SERVICE:    .............          1.6
 Address the Needs of Farmworkers: Fund
 Pesticide Use Survey......................
                                            ============================
NATURAL RESOURCES CONSERVATION SERVICE:
    Debt for Nature:
        Financial assistance to              .............          4.0
         historically underserved for land
         stewardship.......................
        Technical assistance...............  .............          1.0
                                            ----------------------------
          Subtotal, NRCS...................  .............          5.0
                                            ============================
          TOTAL, Secretary's Civil Rights           131.5         143.9
           Initiative......................
                                            ============================
 SMALL-SCALE FARM PROGRAMS IN THE NATIONAL
      COMMISSION ON SMALL FARMS REPORT
 
COOPERATIVE STATE RESEARCH, EDUCATION AND
 EXTENSION SERVICE:
    Sustainable Agriculture Research and              8.0           8.5
     Education (BARE)......................
    Sustainable Agriculture Extension......           3.3           3.3
    1862 and 1890 Formula Funding for Small           2.2           2.2
     Farmers...............................
    Renewable Resources Extension..........           3.2           3.2
                                            ----------------------------
      Subtotal, CSREES.....................          16.7          17.2
                                            ============================
RURAL HOUSING SERVICE: Farmworker Housing            31.4          40.0
 Loans and Grants..........................
                                            ============================
RURAL BUSINESS-COOPERATIVE SERVICE:
    Appropriate Tech Transfer for Rural               1.3           2.0
     Areas (ATTRA).........................
    Rural Cooperative Development Grants...           2.0           5.0
                                            ----------------------------
      Subtotal, RBS........................           3.3           7.0
                                            ============================
DEPARTMENTAL ADMINISTRATION: Outreach and             3.0          10.0
 Technical Assistance (See 2501)...........
                                            ============================
FARM SERVICE AGENCY:
    Direct Farm Ownership Loans:
        Subsidy appropriation (non-add)....         (12.8)         (4.8)
        Loan program level.................          85.6         128.0
    Direct Farm Operating Loans:
        Subsidy appropriation (non-add)....         (50.1)        (29.3)
        Loan program level.................         733.8         500.0
                                            ----------------------------
          Subtotal, FSA Loan Levels........         819.4         628.0
                                            ============================
AGRICULTURAL MARKETING SERVICE:
    Federal State Market Improvement                  1.2           1.2
     Program (FSMIP).......................
    National Organic Standards.............           0.9           1.7
                                            ----------------------------
      Subtotal, AMS........................           2.1           2.9
                                            ============================
GRAIN INSPECTION, PACKERS AND STOCKYARDS
 ADMINISTRATION:
    Packers and Stockyards: livestock                 1.2           1.8
     industry analysis.....................
    Packers and Stockyards: poultry          .............          0.8
     industry analysis.....................
                                            ----------------------------
      Subtotal, GIPSA......................           1.2           2.6
                                            ============================
FOOD AND NUTRITION SERVICE: WlC/Farmers              15.0          20.0
 Market Nutrition Program..................
                                            ============================
NATURAL RESOURCES CONSERVATION SERVICE:              16.3   ............
 Forestry Incentives Pro-  gram............
                                            ============================
FOREST SERVICE:
    Forest Stewardship.....................          28.8          28.8
    Stewardship Incentives.................  .............          5.0
                                            ----------------------------
      Subtotal, FS.........................          28.8          33.8
                                            ============================
Fund for Rural America.....................  .............         60.0
                                            ============================
      Subtotal.............................         937.2         821.5
                                            ============================
Other Small Farm Activities:
    COOPERATIVE STATE RESEARCH, EDUCATION
     AND EXTENSION SERVICE:
        Small Farm Initiative..............  .............          4.0
        National Research Initiative.......           5.0           7.0
                                            ----------------------------
          Subtotal, CSREES.................           5.0          11.0
                                            ============================
    AGRICULTURAL RESEARCH SERVICE..........          11.8          11.7
    AGRICULTURAL MARKETING SERVICE:                   2.2           2.6
     Wholesale Market Development..........
                                            ============================
      Total, Small-Scale Farms Program.....         956.2         846.8
                                            ============================
     SECRETARY'S FARMWORKER INITIATIVE
 
Salaries and Expenses (Coordinator)........  .............          0.1
                                            ============================
       GLOBAL CHANGE RESEARCH PROGRAM
 
Agricultural Research Service..............          26.0          34.0
Cooperative State Research, Education and             9.0          16.0
 Extension Service.........................
Economic Research Service..................           1.0           2.0
Forest Service.............................          17.0          23.0
Natural Resources Conservation Service.....           2.0          14.0
                                            ----------------------------
      TOTAL, Global Change Research Program         55.00          89.0
                                            ============================
          CLEAN WATER ACTION PLAN
 
Agricultural Research Service..............           1.0           5.0
Natural Resources Conservation Service:
    EQIP...................................         174.0         300.0
    Partnership Grants.....................  .............         20.0
    Monitoring.............................  .............          3.0
    Animal Feeding Operations Strategy.....  .............         20.0
                                            ----------------------------
      Subtotal, NRCS.......................         174.0         343.0
                                            ============================
Forest Service.............................         280.0         369.0
                                            ----------------------------
      TOTAL, Clean Water Action Plan.......         455.0         717.0
                                            ============================
         DEBT FOR NATURE INITIATIVE
 
DEBT FOR NATURE INITIATIVE.................  .............          5.0
                                            ============================
    CLIMATE CHANGE TECHNOLOGY INITIATIVE
 
Agricultural Research Service..............  .............          7.0
Forest Service.............................  .............          6.0
Natural Resources Conservation Service.....  .............          3.0
                                            ----------------------------
      TOTAL, Climate Change Technology       .............         16.0
       Initiative..........................
------------------------------------------------------------------------

    Question. Please explain the reason for the increase from the 
fiscal year 1999 level proposed in the Office of the Secretary ``Other 
Services'' object class.
    Answer. The Office of the Secretary requested an increase for the 
Biobased Products Coordination Council in fiscal year 2000. The Council 
is chaired by the Under Secretary for Research, Education and 
Economics. Among the major activities that would be started or carried 
out in fiscal year 2000 by the Under Secretary are the development, 
publication and maintenance of a biobased products list as directed in 
Executive Order 13101, education activities, such as training and 
conferences to inform the public and Government agencies about biobased 
products, demonstration projects to create awareness of and demand for 
biobased construction materials, support for the Office of the 
Environmental Executive, support for technology transfer activities 
through our research agencies, and outreach to land-grant universities 
involved in biobased research, education and extension. The amount for 
this requested increase of over $1 million is reflected in Other 
Services.
                                 ______
                                 

                     Agricultural Research Service

                 Questions Submitted by Senator Cochran

                    fiscal year 1999 appropriations
    Question. Please provide a status report on the execution of each 
of the following funding increases provided to ARS for fiscal year 
1999:
  --Emerging Plant Diseases, Albany, CA, $250,000;
  --Emerging Plant Diseases, Beltsville, MD, $250,000;
  --Emerging Plant Diseases, Frederick, MD, $250,000;
  --Emerging Plant Diseases, College Station, TX, $250,000;
  --Emerging Plant Diseases, Montpellier, France, $250,000;
  --Emerging Plant Diseases, Logan, Utah, $200,000;
  --Fusarium Head Blight (consortium of 12 land grant universities), 
        $3,000,000;
  --Exotic Infectious Animal Diseases, Athens, GA, $500,000;
  --Exotic Infectious Animal Diseases, Ames, IA (NADC),   --$1,000,000;
  --Exotic Infectious Animal Diseases, Beltsville, MD, $500,000;
  --Exotic Infectious Animal Diseases, Pullman, WA, $600,000;
  --Exotic Infectious Animal Diseases, Laramie, WY, $500,000;
  --Environmental Quality/Natural Resources, Bioactive compounds, 
        Gainsville, FL, $250,000;
  --Environmental Quality/Natural Resources, IPM/Areawide, Beltsville, 
        MD, $250,000;
  --Environmental Quality/Natural Resources, IPM/Areawide, Columbia, 
        MO, $400,000;
  --Environmental Quality/Natural Resources, IPM/Areawide, Stoneville, 
        MS, $250,000;
  --Environmental Quality/Natural Resources, IPM/Areawide, College 
        Station, TX, $250,000;
  --Environmental Quality/Natural Resources, Livestock management 
        systems, $1,000,000;
  --Everglades Initiative, Canal Point, FL, $250,000;
  --Everglades Initiative, Miami, FL, $250,000;
  --Everglades Initiative, Ft. Lauderdale, FL, $250,000;
  --Food Safety, Preharvest, Athens, GA, $250,000;
  --Food Safety, Preharvest, Ames, IA, $250,000;
  --Food Safety, Preharvest, West Lafayette, IN, $250,000;
  --Food Safety, Preharvest, Beltsville, MD, $250,000;
  --Food Safety, Preharvest, Clay Center, NE, $600,000;
  --Food Safety, Preharvest, College Station, TX, $250,000;
  --Food Safety, Postharvest, Safety/Quality of Fruits/Vegetables, 
        $1,000,000;
  --Food Safety, Postharvest, Food Safety Engineering, Purdue Univ., 
        $1,000,000;
  --Genetic Resources, Palmer, AK, $100,000;
  --Genetic Resources, Columbia, MO, $700,000;
  --Genetic Resources, Leetown, WV, $1,000,000;
  --Human Nutrition, Little Rock, AR, $750,000;
  --Human Nutrition, San Francisco, CA, $250,000;
  --Human Nutrition, Boston, MA, $250,000;
  --Human Nutrition, Beltsville, MD, $250,000;
  --Human Nutrition, Grand Forks, ND, $250,000;
  --Human Nutrition, Houston, TX, $500,000;
  --Pfiesteria, $719,000;
  --Alternative Fish Feed, Aberdeen, ID, $250,000;
  --Appalachian Fruit Research Station, Kearneysville, WV, $250,000;
  --Aquaculture research, AK, $1,100,000;
  --Biological control of Western weeds, Albany, CA, $300,000;
  --Biomedical materials in plants, $500,000;
  --Cereal crops research, Madison, WI, $250,000;
  --Cotton ginning, Stoneville, MS, $250,000;
  --Endophyte research, $200,000;
  --Fish diseases, Auburn, AL, $750,000;
  --Fish Farming Experiment Laboratory, Stuttgart, AR, $750,000;
  --Floriculture and nursery crop research, $1,000,000;
  --Horticulture, Ft. Pierce, FL, $500,000;
  --Forage crops, Woodward, OK, $250,000;
  --Garden Unit, National Arboretum, Washington, DC, $250,000;
  --Golden Nematode, Ithaca, NY, $150,000;
  --Grape Rootstock, Geneva, NY, $300,000;
  --Grasshopper research, AK, $750,000;
  --Grazinglands research, El Reno, OK, $250,000;
  --Honeybee research, Baton Rouge, LA, $300,000;
  --Lettuce geneticist/breeding, Salinas, CA, $250,000;
  --Lyme disease (Tick Control Project), Beltsville, MD, $200,000;
  --Manure handling and disposal, Starkville, MS, $500,000;
  --Meadowfoam research, Peoria, IL, $200,000;
  --Mycoplasma research, Starkville, MS, $250,000;
  --National Warmwater Aquaculture Center, Stoneville, MS, $1,100,000;
  --National Agriculture Library, $250,000;
  --Natural products research, MS, $750,000;
  --New England Plant, Soil and Water Lab, Orono, ME, $250,000;
  --Non-chemical control of pecan insect pests, Byron, GA, $250,000;
  --Peach varieties research, Byron, GA, $150,000;
  --Peanut quality research, Dawson GA/Raleigh, NC, $1,000,000;
  --Pear Thrips, Ithaca, NY, $100,000;
  --Potato Breeder, Aberdeen, ID, $150,000;
  --Range research, Burns, OR, $250,000;
  --Rice research, Stuttgart, AR, $1,400,000;
  --Rice research, Davis, CA, $250,000;
  --Rice research, Beaumont, TX, $200,000;
  --Root diseases of wheat and barley, Pullman, WA, $500,000;
  --Small fruits research, Poplarville, MS, $250,000;
  -- Small fruits research, Corvallis, OR, $250,000;
  --Soil tilth research, Ames, IA, $500,000;
  --Soybean and corn research, Stoneville, MS, $750,000;
  --Subtropical Animal Research Station, Brooksville, FL, $500,000;
  --Subtropical Horticultural Research Station, Miami, FL, $300,000;
  --Sugarbeet research, Ft. Collins, CO, $200,000;
  --U.S. Plant Stress and Water Conservation Laboratory, Lubbock, TX, 
        $500,000;
  --Vegetable research, East Lansing, MI, $200,000;
  --Wild rice research, St. Paul, MN, $100,000;
  --Wind erosion research, Manhattan, KS, $250,000.
    Answer. ARS is in the process of releasing each of these program 
increases added by Congress in fiscal year 1999 in the amounts and for 
the purposes authorized in accordance with the fiscal year 1999 
Appropriations Act. A detailed listing of the distribution of these 
increases will be provided for the record.
    [The information follows:]

               AGRICULTURAL RESEARCH SERVICE IMPLEMENTATION OF FISCAL YEAR 1999 PROGRAM INCREASES
----------------------------------------------------------------------------------------------------------------
                                                                                                Status of New
        Funding research             Amount       Research location      Status/purpose         Scientist(s)
                                                                                                 Position(s)
----------------------------------------------------------------------------------------------------------------
Emerging Plant Diseases........        $250,000  Albany, CA........  Funds have been        New scientist
                                                                      released and work in   position not
                                                                      underway on new and    required.
                                                                      emerging invasive
                                                                      weeds in the Western
                                                                      U.S.
                                        250,000  Beltsville, MD....  Funds have been        Recruitment actions
                                                                      released and work is   are underway to
                                                                      underway on taxonomy   hire a Botanist.
                                                                      of bunt and smut of
                                                                      fungi.
                                        250,000  Frederick, MD.....  Funds have been        New scientist
                                                                      released and work is   position not
                                                                      underway for           required.
                                                                      research on karnal
                                                                      bunt.
                                        250,000  College Sta., TX..  Funds have been        Recruitment actions
                                                                      released and work is   are underway to
                                                                      underway for           hire a Plant
                                                                      research on sorghum    Pathologist.
                                                                      ergot.
                                        250,000  Montpellier, FR...  Funds have been        Recruitment actions
                                                                      released and work is   are underway to
                                                                      underway to develop    hire a Plant
                                                                      exotic microbial       Pathologist.
                                                                      biological control
                                                                      agents in eurasia.
                                        200,000  Logan, LT.........  Funds have been        Recruitment actions
                                                                      released and work is   are underway for a
                                                                      underway on research   Veterinarian
                                                                      on poisoning of        Pharmacologist.
                                                                      livestock by
                                                                      larkspur.
Fusarium Head Blight...........       3,000,000  Headquarters......  Negotiations have      Not Applicable.
                                                                      been completed and
                                                                      specific cooperative
                                                                      agreements are being
                                                                      entered into with
                                                                      the 12 State
                                                                      Consortium.
Exotic Infectious Animal                500,000  Athens, GA........  Funds have been        Recruitment actions
 Diseases.                                                            released and work is   are underway for a
                                                                      underway on highly     Veterinary Medical
                                                                      pathogenic avian       Officer.
                                                                      influenza and exotic
                                                                      newcastle disease.
                                      1,000,000  Ames, IA..........  Funds have been        Recruitment actions
                                                                      released and           are underway for a
                                                                      research is underway   Veterinary Medical
                                                                      on Johne's disease,    Officer.
                                                                      bovine tuberculosis
                                                                      and emerging enteric
                                                                      diseases of swine.
                                        500,000  Beltsville, MD....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an
                                                                      on parasitic           Immunologist and
                                                                      immunology.            and Animal
                                                                                             Microbiologist.
                                        600,000  Pullman, WA.......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Molecular
                                                                      on prion diseases      Biologist and an
                                                                      and anaplasmosis.      Entomogist.
                                        500,000  Laramie, WY.......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Entomologist/
                                                                      on vesicular           Microbiologist.
                                                                      stomatitis an
                                                                      arthropod-borne
                                                                      disease of livestock.
Environmental Quality/Natural           250,000  Gainesville, FL...  Funds have been        Recruitment actions
 Resources.                                                           released and           are underway
                                                                      research is underway   actions are
                                                                      for the development    underway to hire a
                                                                      of bioactive           Chemist.
                                                                      compounds that
                                                                      attract natural
                                                                      enemies of insect
                                                                      pests.
                                        250,000  Beltsville, MD....  Funds have been        Recruitment action
                                                                      released and           is underway to hire
                                                                      Recruitment research   an Molecular
                                                                      is underway to         Biologist/Botanist/
                                                                      develop technologies   Entomologist
                                                                      for management of
                                                                      gypsy moth with
                                                                      entomophaga maimaiga.
                                        400,000  Columbia, MO......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an
                                                                      to develop methods     Entomologist.
                                                                      of in vitro
                                                                      proagation of
                                                                      beneficial insects
                                                                      for biological
                                                                      control.
                                        250,000  Stoneville, MS....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an
                                                                      to develop mass        Engomologist.
                                                                      propagation
                                                                      technologies for
                                                                      beneficial insects
                                                                      (lygus bugs/leafy
                                                                      spurge).
                                        250,000  College Sta., TX..  Funds have been        Recruitment actions
                                                                      released andresearch   are underway to
                                                                      is underway to         hire an
                                                                      developnew and         Entomologist.
                                                                      improved areawide
                                                                      IPM technology in
                                                                      support of the boll
                                                                      weevil eradication
                                                                      program.
Livestock Mgt..................       1,000,000  Ames, IA..........  Funds have been        Recruitment actions
                                                                      released to            are underway to
                                                                      establish a program    hire the Research
                                                                      at the National        Leader. Recruitment
                                                                      Swine Research         actions are
                                                                      Center on livestock    underway for three
                                                                      management.            animal scientists.
Everglades Initiative..........         250,000  Canal Point, FL...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Soil
                                                                      on soil microbiology   Microbiologist.
                                                                      as it relatees to
                                                                      water quality.
                                        250,000  Miami, FL.........  Funds have been        Recruitment actions
                                                                      released an research   are underway to
                                                                      is underway to         hire an Agronomist.
                                                                      develop a computer
                                                                      model on the impact
                                                                      of the Everglades
                                                                      Nat'l Park
                                                                      Restoration Plan on
                                                                      the sustainability
                                                                      of agriculture in
                                                                      south Florida.
                                        250,000  Ft. Lauderdale, FL  Funds have been        A selection is
                                                                      released an research   pending to hire an
                                                                      is underway for the    Entomologist.
                                                                      development of
                                                                      melaleuca biological
                                                                      control..
Food Safety, Preharvest........         300,000  Athens, GA........  Funds have been        Recruitment actions
                                                                      released and           are underway for a
                                                                      research is underway   Microbiologist.
                                                                      for treatment of
                                                                      poultry manure to
                                                                      prevent pathogen
                                                                      transmission.
                                        300,000  Ames, IA..........  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a
                                                                      to prevent pathogen    Microbiologist.
                                                                      contamination in
                                                                      animals particularly
                                                                      swine.
                                        300,000  West Lafayette, IN  Funds have been        Recruitment action
                                                                      released and           is underway to hire
                                                                      research is underway   an Animal
                                                                      to prevent pathogen    Scientist.
                                                                      contamination in
                                                                      animals particularly
                                                                      swine.
                                        600,000  Beltsville, MD....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a
                                                                      for animal waste       Microbiologists and
                                                                      handling systems to    an Animal
                                                                      prevent pathogen       Scientist.
                                                                      transmission.
                                        300,000  Clay Center, NE...  Funds have been        Recruitment actions
                                                                      released and           are underway to a
                                                                      research is underway   hire a
                                                                      to prevent zoonotic    Microbiologist.
                                                                      pathogen
                                                                      transmission in
                                                                      cattle.
                                        600,000  College Stn., TX..  Funds have been        Recruitment actions
                                                                      released research is   are underway to
                                                                      underway to prevent    hire two
                                                                      antibiotic             Microbiologists.
                                                                      resistance.
Food Safety, Postharvest.......       1,200,000  Albanay, CA.......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire two
                                                                      to develop knowledge   Microbiologists.
                                                                      pathogens on various   One Microbiologist
                                                                      fruits and             has been hired.
                                                                      vegetables.
                                      1,000,000  Purdue Univ.......  Funds have been        Not Applicable.
                                                                      released and a
                                                                      specific cooperative
                                                                      agreement has been
                                                                      executed with Purdue
                                                                      Univ.
(Note: Final distribution of
 Food Safety increases by
 location is different from
 those listed in question.)
 
Genetic Resources..............         100,000  Palmer, AK........  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Curator.
                                                                      on arctic plant
                                                                      germplasm storage,
                                                                      regeneration,
                                                                      evaluation and
                                                                      documentation at
                                                                      Palmer, AK.
                                        700,000  Columbia, MO......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Research
                                                                      on soybean and         Geneticist and a
                                                                      genomic research.      Molecular
                                                                                             Biologist.
                                      1,000,000  Leetown, WV.......  Funds have been        Recruitment actions
                                                                      released and           are underway
                                                                      research is underway   actions are
                                                                      on trout genome at     underway for two
                                                                      the National Center    Trout/Animal
                                                                      for Cool and Cold      Scientists.
                                                                      Water Aquaculture.
Human Nutrition................         750,000  Little Rock, AR...  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on nutrient-gene
                                                                      interactions.
                                        250,000  San Francisco, CA.  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Human
                                                                      on nutrient-gene       Nutritionist.
                                                                      interactions.
                                        250,000  Boston, MA........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on diet and
                                                                      degenerative
                                                                      diseases in the
                                                                      aging.
                                        250,000  Beltsville, MD....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Human
                                                                      on diet and            Nutritionist.
                                                                      flavonoid function.
                                        250,000  Grand Forks, ND...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Immunologist/
                                                                      on the role of trace   Chemist.
                                                                      minerals in gene
                                                                      expression.
                                        500,000  Houston, TX.......  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on nutrition and
                                                                      child development.
Pfiesteria ($719,000)..........         300,000  Beltsville, MD....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Soil
                                                                      on the relationship    Scientist.
                                                                      between agricultural
                                                                      practices and
                                                                      pfiesteria in the
                                                                      Chesapeake Bay and
                                                                      its tributaries.
                                        100,000  Auburn, AL........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on pfiesteria.
                                        250,000  New Orleans, LA...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plan
                                                                      on pfiesteria.         Physiologist.
                                         69,000  Florence, SC......  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      to protect water
                                                                      quality through
                                                                      effective mgt. of
                                                                      agricultural
                                                                      nutrients.
Alternative Fish Feed..........         250,000  Aberdeen, ID......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a fish
                                                                      on cereal grains and   geneticist.
                                                                      fish.
Appalachian Fruit Research              250,000  Kearneysville, WV.  Funds have been        New scientist
 Station.                                                             released and           position not
                                                                      research is underway   required.
                                                                      on diseases of
                                                                      apples and pears.
Aquaculture Res. in Alaska.....       1,100,000  Albany, CA          Funds have been        Recruitment actions
                                                  (Fairbanks, AK).    released and           are underway to
                                                                      research is underway   hire a Chemical
                                                                      on aquaculture         Engineer/Food
                                                                      research in Alaska.    Technologist.
                                                                      Research is being
                                                                      conducted in
                                                                      cooperation with the
                                                                      Univ. of Alaska.
Biological Control of Western           300,000  Albany, CA........  Funds have been        Recruitment actions
 Weeds.                                                               released and           are underway to
                                                                      research is underway   hire a Research
                                                                      on biocontrol of       Entomologist.
                                                                      yhellow starthistle
                                                                      and other non-
                                                                      indigeneous plant
                                                                      pests in the western
                                                                      U.S.
Biomedical Materials in Plants.         500,000  Beltsville, MD....  Funds have been        Not Applicable.
                                                                      released and
                                                                      research is
                                                                      underway. A specific
                                                                      cooperative
                                                                      agreement ($300,000)
                                                                      has been executed
                                                                      with the Biomedical
                                                                      Foundation, Inc.
Cereal Crops Research..........         250,000  Madison, WI.......  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on barley and oak
                                                                      quality.
Cotton Ginning.................         250,000  Stoneville, MS....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an Engineer.
                                                                      on cotton ginning.
Endophyte Research.............         200,000  Booneville, AR....  Funds have been        No Applicable.
                                                                      released and
                                                                      negotiations are
                                                                      underway with the
                                                                      Universities of AR,
                                                                      MO and Oregon State
                                                                      Univ.
Fish Diseases..................         750,000  Auburn, AL........  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Aquatic
                                                                      on fish health.        Pathologist.
                                                                                             Selection has been
                                                                                             made to hire a new
                                                                                             Microbiologist.
Fish Farming Experiment LAB....         750,000  Stuttgart, AR.....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Physiologist
                                                                      on aquaculture         and a Fishery
                                                                      production systems,    Biologist.
                                                                      therapeutics
                                                                      evaluation and
                                                                      chemical
                                                                      registration.
Floriculture and Nursery Crop           600,000  Headquarters......  Funds have been        Not Applicable
 Research ($1,000,000).                                               released and
                                                                      negotiations are
                                                                      underway for
                                                                      specific cooperative
                                                                      agreements..
                                        400,000  Wash., D.C.         Funds have been        Recruitment actions
                                                  (Arbore-  tum).     released and           are underway for a
                                                                      research is underway   Plant Pathologist.
                                                                      on floriculture and
                                                                      nursery crops.
Horticulture...................         500,000  Ft. Pierce, FL....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      on vegetable           Pathologist and a
                                                                      virology and           Horticulturalist.
                                                                      irrigation
                                                                      management.
Forage Crops...................         250,000  Woodward, OK......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an Agronomist.
                                                                      to accelerate forage
                                                                      improvement.
Garden Unit, Natl. Arboretum...         250,000  Washington, DC....  Funds have been        New scientist
                                                                      released for           position not
                                                                      increased staffing     required.
                                                                      for the Gardens Unit
                                                                      at the National
                                                                      Arboretum.
Golden Nematode................         150,000  Ithaca, NY........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on golden nematode.
Grape Rootstock................         300,000  Geneva, NY (w/s     Funds have been        Recruitment actions
                                                  Ithaca).            released and           are underway to
                                                                      research is underway   hire a Geneticists.
                                                                      on grape rootstock
                                                                      evaluation of pest,
                                                                      disease resistance
                                                                      and stress tolerance.
Grasshopper Research...........         750,000  Sidney, MT          Funds have been        Recruitment actions
                                                  (Alaska).           released and           are underway to
                                                                      research is underway   hire two
                                                                      on IPM for             Entomologist.
                                                                      grasshopper control
                                                                      in the Delta
                                                                      Junction region of
                                                                      Alaska.
Grazinglands Research..........         250,000  El Reno, OK.......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an Agronomist
                                                                      for the development    that will be
                                                                      of pasture             stationed at
                                                                      management systems     Langston Univ.
                                                                      that enhance
                                                                      productivity and
                                                                      water quality in the
                                                                      Southern Great
                                                                      Plains.
Honeybee Research..............         300,000  Baton Rouge, LA...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire an
                                                                      for the control of     Entomologist.
                                                                      parasitic bee mites.
Lettuce/Geneticist Breeding....         250,000  Salinas, CA.......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Geneticist/
                                                                      for the control to     Breeder.
                                                                      develop new lettuce
                                                                      varieties and
                                                                      improved product
                                                                      quality.
Lyme Disease...................         200,000  Beltsville, MD....  Funds have been        Not applicable.
                                                                      released to support
                                                                      the NE Regional Lyme
                                                                      Tick Project.
Manure Handling and Disposal...         500,000  Ms State            Funds have been        Recruitment actions
                                                  (Starkville), MS.   released and           are underway to
                                                                      research is underway   hire an Engineer.
                                                                      on procedures for
                                                                      poultry manure and
                                                                      disposal with
                                                                      emphasis on reducing
                                                                      the amounts of
                                                                      phosphorus in litter
                                                                      and the environment.
Meadowfoam Research............         200,000  Peoria, IL........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research on            required.
                                                                      meadowfoam is
                                                                      underway.
Mycoplasma Research............         250,000  MS State,           Funds have been        Recruitment actions
                                                  (Starkville) MS.    released and           are underway to
                                                                      research is underway   hire a Molecular
                                                                      on mycoplasma          Biologist.
                                                                      gallisepticum.
Nat'1 Warmwater Aquaculture           1,100,000  Stoneville, MS....  Funds have been        Recruitment actions
 Ctr..                                                                released and           are underway to
                                                                      research is underway   hire a Molecular
                                                                      on warmwater           Biologist and a
                                                                      aquaculture. Half of   Microbiologist.
                                                                      these funds will be
                                                                      added to the
                                                                      existing specific
                                                                      cooperative
                                                                      agreement with
                                                                      Mississippi
                                                                      Agricultural and
                                                                      Forestry Experiment
                                                                      Station (MAFES).
Nat'1 Agriculture Library......         250,000  Beltsville, MD....  Funds have been        Final selection of a
                                                                      released and will be   Librarian/Technical
                                                                      used to purchase       Information
                                                                      periodicals, enhance   Specialist is in
                                                                      preservation           process.
                                                                      efforts, and improve
                                                                      electronic retrieval
                                                                      capacity, including
                                                                      the information
                                                                      centers.
Natural Products Research......        $750,000  Oxford, MS........  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Molecular
                                                                      on natural products.   Biologist.
                                                                      Half of these funds
                                                                      will be added to the
                                                                      existing specific
                                                                      cooperative
                                                                      agreement with the
                                                                      University of
                                                                      Mississippi.
New England Plant, Soil, and            250,000  Orono, ME.........  Funds have been        Recruitment actions
 Water Lab.                                                           released and           are underway to
                                                                      research is underway   hire a Soil
                                                                      on nutritient          Biochemist/
                                                                      management in NE       Microbiologist.
                                                                      cropping systems.
Non-chemical Control of Pecan           250,000  Byron, GA.........  Funds have been        Recruitment actions
 Insect Pests.                                                        released and           are underway to
                                                                      research is underway   hire an
                                                                      on nonchemical         Entomologist.
                                                                      alternatives to the
                                                                      use of chemical
                                                                      pesticides to
                                                                      control fruit and
                                                                      foliar pests of
                                                                      pecans.
Peach Varieties Research.......         150,000  Byron, GA.........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on new peach
                                                                      varieties.
Peanut Quality.................       1,000,000  Dawson, GA/         Funds have been        Recruitment actions
                                                  Raleigh,  NC.       released and on        are underway to
                                                                      peanut quality. A      hire a Systems
                                                                      fpecific cooperative   Engineer/Economist.
                                                                      agreement is being
                                                                      negotiated with
                                                                      Auburn University.
Pear Thrips....................         100,000  Ithaca, NY........  Funds have been        Not Applicable.
                                                                      released to support
                                                                      a specific
                                                                      cooperative
                                                                      agreement with the
                                                                      Univ. of VT.
Potato Breeder.................         150,000  Aberdeen, ID......  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Geneticist/
                                                                      to develop new         Breeder.
                                                                      potato germplasm
                                                                      with improve
                                                                      processing & fresh
                                                                      market qual. with
                                                                      resistance to pests/
                                                                      diseases.
Range Research.................         250,000  Burns, OR.........  Funds have been        A selection has been
                                                                      released and           made to hire
                                                                      research is underway   Rangeland
                                                                      to develop new         Scientist.
                                                                      grazing management
                                                                      approaches that have
                                                                      positive effects on
                                                                      rangeland plant
                                                                      communities.
Rice Research..................       1,400,000  Stuttgart, AR.....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      on the genetic         Pathologist, Plant
                                                                      improvement of rice.   Physiologist and
                                                                                             Molecular
                                                                                             Biologist.
                                                                                             Selection of a new
                                                                                             Cytogeneticist has
                                                                                             been made.
Rice Research..................         250,000  Davis, CA.........  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on the rice
                                                                      germplasm.
Rice Research..................         200,000  Beaumont, TX......  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on the rice
                                                                      germplasm
                                                                      improvement.
Root Diseases of Wheat and              500,000  Pullman, WA.......  Funds have been        Recruitment actions
 Barley.                                                              released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      on the root diseases   Pathologist.
                                                                      of wheat and barley.
Small Fruits Research..........         250,000  Poplarville, MS...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      on the root diseases   Pathologist.
                                                                      of what and barley.
Small Fruits Research..........         250,000  Corvallis, OR.....  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is            required.
                                                                      underway. Specific
                                                                      cooperative
                                                                      agreements are being
                                                                      negotiated ($160,000
                                                                      for pest and
                                                                      diseases control and
                                                                      the development of
                                                                      agricultural systems
                                                                      for northwest small
                                                                      fruits productions.
Soil Tilth Research............         500,000  Ames, IA..........  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire to
                                                                      on effective soil      Agronomists.
                                                                      and water management
                                                                      practices.
Soybean and Corn Research......         750,000  Stoneville, MS....  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      to increase farm       Geneticists, Plans
                                                                      profits through the    Physiologist and
                                                                      use of corn and        Plant Molecular
                                                                      soybeans in rotation   Biologist/
                                                                      with cotton and to     Geneticists.
                                                                      expand research on
                                                                      plant molecular
                                                                      genetics.
Subtropical Animal Research....         500,000  Brooksville, FL...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Nutritionist/
                                                                      on beef cattle.        Biological Systems
                                                                                             and a Geneticists.
Subtropical Horticultural               300,000  Miami, FL.........  Funds have been        Recruitment actions
 Research Station.                                                    released and           are underway to
                                                                      research is underway   hire a Geneticist/
                                                                      on subtropical/        Curator.
                                                                      tropical ornamental
                                                                      plant germplasm.
Sugarbeet Research.............         200,000  Ft. Collins, CO...  Funds have been        Recruitment actions
                                                                      released and           are underway to
                                                                      research is underway   hire a Plant
                                                                      on diseases of         Pathologist.
                                                                      sugarbeet.
U.S. Plant Stress and Water             500,000  Lubbock, TX.......  Funds have been        New scientist
 Conservation Lab.                                                    released and           position not
                                                                      research is underway   required.
                                                                      on plant required
                                                                      stress factors in
                                                                      the High Plains
                                                                      region.
Vegetable Research.............         200,000  Lansing, MI.......  Funds have been        New scientist
                                                                      released and           position not
                                                                      research is underway   required.
                                                                      on vegetable crops.
Wild Rice Research.............         100,000  St. Paul, MN......  Funds have been        Not Applicable.
                                                                      released and added
                                                                      to the existing
                                                                      specific cooperative
                                                                      agreement with North
                                                                      Central Ag. Expt.
                                                                      Station.
Wind Erosion...................         250,000  Manhattan, KS.....  Funds have been        Recruitment actions
                                                                      released and           are underway for a
                                                                      research is underway   Soil Scientist/
                                                                      on wind erosion in     Agricultural
                                                                      Manhattan, KS.         Engineer.
----------------------------------------------------------------------------------------------------------------

                    fiscal year 2000 budget request
    Question. The fiscal year 2000 budget proposes an increase of $76.4 
million for new and expanded research programs and an increase of $9.9 
million for pay costs, partially offset by a proposed decrease of $35 
million for ongoing research projects. As the Department's materials 
indicate, many of the projects proposed for termination have 
contributed to solving important agricultural problems. While the 
budget indicates that this research is proposed for termination because 
it has been deemed less critical than the higher priority research the 
Administration proposes, it is also apparent that the proposed 
terminations include only research the Congress initiated or has 
continued to support. Please tell the Committee how the Administration 
determined that each of these research projects was ``less critical'' 
than those the President's fiscal year 2000 budget proposes increased 
funding to support.
    Answer. The President's fiscal year 2000 budget for the 
Agricultural Research Service is $836,868,000. This recommendation 
recognizes the importance of the Department's in-house science program 
and its capacity to solve a multitude of problems affecting production 
agriculture, the environment, human health and safety, utilization 
research, trade, and rural development. This budget provides an 
increase for new and expanded research programs of $51.4 million as 
well $9.9 million for authorized pay raises. Additionally, the Agency 
is requesting $44.5 million for ongoing laboratory modernization and 
construction projects.
    These increase recommendations are made under the very tight 
funding limitations established for the fiscal year 2000 budget. This 
Administration has proposed and continues to support a number of 
critical initiatives, such as food safety, global climate change, and 
human nutrition. Given the spending constraints of the fiscal year 2000 
budget, and the urgency this Administration places on the research 
initiatives proposed, it was necessary again to request the termination 
of a number of ongoing research projects. Some of these projects were 
identified in prior budgets as less critical to the overriding issues 
of national importance, such as food safety for all Americans. While 
important, such projects as wild rice breeding, turf grass evaluation, 
development of feeds for aquaculture, floriculture research, Hops 
genetics research, etc. were deemed to be of lesser priority than the 
initiatives advanced in this budget. All the projects are evaluated 
within the ARS research portfolio. Decisions are based on the following 
criteria: the relevance of the research project, the availability of 
sufficient resources to conduct the research, and the overall impact of 
research on American agriculture.
    The overall reduction and redirection requested represents four 
percent of the total research program authorized and funded by the 
Congress. The $35 million would essentially be reallocated to these 
national research priorities. These initiatives are supported by the 
Congress, agricultural stakeholders and others who have interests in 
food, nutrition, and environmental programs. Infectious and zoonotic 
diseases of livestock, wheat and barley scab, bioinformatics, genetic 
engineering in major crops, invasive weeds, pathogen control in 
slaughtering, nutrition and chronic diseases, IPM, understanding the 
carbon cycle in global change--these are some of the new projects 
requested and are considered to be of greater critical importance to 
the Congress and the Nation than those projects recommended for 
termination.
    Question. Please prioritize the research program and operational 
increases requested for fiscal year 2000.
    Answer. ARS' program and operational increases proposed for fiscal 
year 2000 listed in order of priority will be provided for the record.
    [The information follows:]

Agricultural Research Service

              [Proposed Increases Listed in Priority Order]

Pay Costs...............................................      $9,930,000
Emerging Diseases and Exotic Pests of Plants and Animals       8,133,000
Food Safety.............................................      11,720,000
Human Nutrition Initiative..............................      20,250,000
Food Quality and Protection Act Implementation..........       3,167,000
Sustainable Ecosystems..................................      11,100,000
Agricultural Genome.....................................       2,750,000
Global Climate Change...................................      15,300,000
Air Quality.............................................       2,000,000
Agricultural Information................................       2,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      86,350,000

    Question. For each of the research program increases proposed for 
fiscal year 2000, please provide the current (base) level of funding 
available to support the research, a brief description of the research 
work and where the research will be conducted.
    Answer. The current base level funding, a brief description of the 
research work and location for fiscal year 2000 increases will be 
provided for the record.
    [The information follows:]
   Agricultural Research Service Fiscal Year 2000 Proposed Increases
 sustainable ecosystems--$11,100,000 ($112,074,000 available in fiscal 
                               year 1999)
Implement the CENR (Committee on Environment and Natural Resources) 
        Research and Monitoring Framework--$600,000
    Tucson, AZ, $300,000.--Expand Semi-Arid Land-Surface-Atmosphere 
(SALSA) project in the Southwest.
    Miami, FL, $300,000.--Expand projects on integrated crop and animal 
production systems in the Southeast.
Advance Ecological Science for Sustainable Livestock Management 
        Systems--$900,000
    Ames, IA, $300,000.--Develop improved storage, handling, and 
treatment systems for swine manure.
    Brooksville, FL, $300,000.--Develop best management practices for 
effective use of manure nutrients from cattle.
    University Park, PA $300,000.--Initiate a national effort to 
develop Park, PA the relationship between soil phosphorus and movement 
of phosphorus to surface waters in major soils of the U.S.
Predict Impacts and Restore the Viability of Damaged Riparian Zones and 
        Coastal Habitats.--$1,100,000
    Tifton, GA $300,000.--Develop management practices to maximize the 
ability of riparian zones to protect water quality in the Coastal 
Plains.
    Oxford, MS, $300,000.--Develop methods to protect water quality in 
the Mississippi Delta.
    Florence, SC, $250,000.--Determine the effectiveness of removal of 
nutrients and pathogens from liquid animal waste.
    Baton Rouge, LA $250,000.--Develop guidelines and procedures to 
protect water quality in the Louisiana Bayous.
Conduct Integrated Ecosystem Risk Assessments--$600,000
    Ft. Collins, $300,000.--Develop models and decision support CO 
tools to assess stresses and effects of Great Plains farming practices.
    Temple, TX, $300,000.--Develop models to forecast ecosystem 
responses to multiple stresses related to agricultural production 
practices and systems.
Prevent and Control Invasive Weed Species for Ecosystem Management--
        $600,000
    Prosser, WA $300,000.--Develop and implement weed IPM, with a focus 
on weeds of irrigated crops for ecosystem management.
    Albany, CA, $300,000.--Conduct foreign exploration for new weed 
biological control agents for ecosystem management.
Develop and Implement Biologically-Based Integrated Pest Management 
        Systems for Invasive Weeds and Other Pests--$2,700,000.
    Davis, CA, $300,000.--Develop biologically-based weed management 
with emphasis on integration of biological control agents.
    Logan, UT $300,000.--Develop biologically-based weed IPM with 
emphasis on invasive weeds.
    Morris, MN, $300,000.--Develop biologically-based weed IPM with 
emphasis on crop weeds.
    Frederick, $300,000.--Conduct foreign exploration MD for new 
pathogens of exotic weeds.
    Ft. Lauderdale, FL, $300,000.--Conduct foreign exploration for new 
FLbiological control agents of exotic weeds.
    Newark, DE, $300,000.--Conduct foreign exploration for new insect 
natural enemies of horticultural crop pests.
    Stuttgart, AR, $300,000.--Develop and implement biological controls 
to manage invasive weed and problematic algal species.
    Beltsville, MD $300,000.--Develop attractants for invasive pest 
species such as Asian Longhorned Beetle.
    Kearneysville, WV $300,000.--Develop and implement non-chemical 
pest management of tree fruits and small fruits.
Prevent and Control Eutrophication, Harmful Algal Blooms, and Hypoxia--
        $4,100,000
    Oxford, MS, $300,000.--Develop alternative practices and systems to 
reduce storm water runoff and runoff of manure and fertilizer nutrients 
in coastal waterways.
    Lincoln, NE, $300,000.--Develop guidelines and decisionmaking tools 
that establish sound levels of manure and fertilizer nutrients in the 
Midwest and the hypoxia problem in the Gulf of Mexico.
    Ames, IA, $300,000.--Establish a center for hypoxia research in the 
Midwest.
    Beltsville, MD, $300,000.--Expand projects for improved soil, 
water, and air quality in the Chesapeake Bay.
    Stoneville, MS, $500,000.--Develop techniques to better monitor and 
manage water quality, off-flavor components, and wastes in aquaculture 
production systems.
    University Park, PA, $300,000.--Develop guidelines and 
decisionmaking tools on sound levels of phosphorus and other animal 
manure nutrients to reduce eutrophication and toxic algal blooms in the 
Mid-Atlantic region.
    Columbus, OH, $300,000.--Expand projects to capture, treat, and 
recycle drainage water in the Midwest.
    Watkinsville, GA, $300,000.--Expand projects for improved soil, 
water, and air quality in the Southeast.
    Tifton, GA, $300,000.--Expand projects to enhance the use of 
wetlands and riparian zones for fish and wildlife habitat.
    Bushland, TX, $300,000.--Expand projects for improved soil, water, 
and air quality on the High Plains of the Southwest.
    Kimberly, ID, $300,000.--Expand projects for improved soil, water, 
and air quality in the Northwest.
    Ames, IA, $300,000.--Determine processes controlling the 
effectiveness of biofilters in Midwest agricultural drainage areas.
    Florence, SC, $300,000.--Develop best management practices for 
effective use of swine manure nutrients.
Predict Ecological Impacts of Extreme Natural Events--$500,000
    Lubbock, TX, $250,000.--Develop technology for seasonal and 
interannual weather predictions based upon El Nino forecasting to 
decisionmaking by dryland farmers.
    El Reno, OK, $250,000.--Develop weather forecasting capabilities to 
climate variability and forecasts in time scales relevant to 
agricultural operations.
   air quality--$2,000,000 ($4,923,000 available in fiscal year 1999)
Research on Particulate (PM) Emissions and Controls--$1,500,000
    Fresno, CA, $800,000.--Understand processes of agricultural PM 
emissions during field operations (equipment usage and burning).
    Lubbock, TX, $400,000.--Understand processes of PM emissions by 
cattle feed yards, and swine facilities.
    Pullman, WA $300,000.--Develop understanding of emission of PM by 
agriculture (emphasis on high wind-induced emissions, but also with 
attention to burning).
Research on Emission and Control of Odors--$250,000
    Clay Center, NE, $250,000.--Determine the influence of cattle diet 
on the formation of odor-causing compounds.
Research on Protection of Agricultural Crops from the Effects of 
        Tropospheric Ozone--$250,000
    Raleigh, NC, $250,000.--Develop understanding of the biophysical 
processes by which ozone causes crop damage.
 global change research--$15,300,000 ($25,806,000 available in fiscal 
                               year 1999)
U.S. Global Change Research Program, Carbon Cycle Research Initiative--
        $5,000,000
    Ft. Collins, CO, $600,000.--Develop a balance sheet approach to the 
modeling and prediction of agricultural emissions and sequestrations of 
greenhouse gases at the national scale.
    Auburn, AL, $600,000.--Determine the extent of sequestration of 
greenhouse gases in cropland soils associated with tillage systems.
    Cheyenne, WY, $600,000.--Determine the rate, sources, fate, 
seasonal timing, and depths of deposition of organic carbon in cropland 
and grazingland soils.
    El Reno, OK, $600,000.--Develop methods and establish long-term 
monitoring of changes in the carbon balance of various forage 
production systems.
    Temple, TX, $600,000.--Document rates of storage of atmospheric 
greenhouse gases in clay soils.
    Athens, GA, $500,000.--Develop and apply new technology for 
monitoring methane emissions from cattle, livestock waste lagoons, and 
other agricultural sources.
    Mandan, ND, $300,000.--Develop data bases suitable for modification 
and validation of models which quantify rates of carbon storage in 
grazinglands soils.
    Pendleton, OR, $300,000.--Develop simple, easily-used models which 
accurately predict rates of change in organic carbon content of 
cropland soils.
    Morris, MN, $300,000.--Document the effects of tillage and other 
management options for cold, wet soils with carbon storage.
    St. Paul, MN, $300,000.--Develop new technology for accurately 
measuring fluxes of carbon dioxide above crops and cropland soils.
    Ames, IA, $300,000.--Determine which of the many kinds of microbes 
present in cropland soils are most important in altering soil carbon 
content.
Mitigating Climate Change Impacts on Food Availability--$2,000,000
    Phoenix, AZ, $600,000.--Determine how the availability of water and 
plant nutrients interact with rising temperatures and atmospheric 
carbon dioxide levels.
    Gainesville, FL, $600,000.--Identify the physiological, 
biochemical, and genetic mechanisms by which rising temperatures reduce 
seed yield and quality of sensitive crops.
    Beltsville, MD, $500,000.--Identify germplasm of major crops that 
is tolerant of high temperatures, limited availability of water or 
nutrients, and elevated atmospheric carbon dioxide levels.
    Temple, TX, $300,000.--Determine how the effects of rising 
atmospheric carbon dioxide levels will alter the productivity and water 
relations of rangelands.
Impacts of Atmospheric and Climate Change on Alaskan Agro-Ecosystems--
        $1,000,000
    Fairbanks, AK, $1,000,000.--Initiate research on the effects of a 
changing climate and rising atmospheric carbon dioxide levels on 
Alaskan agriculture.
U.S. Global Change Research Program National Assessment Activities--
        $300,000
    Headquarters, $300,000.--Participate in developing integrated 
assessment of global change impacts on agriculture, food and water 
availability, and other relevant resources and sectors of the U.S. 
economy, as required by the Global Change Act of 1990.
New Technology for Predicting and Adapting to Global Change Impacts--
        $4,000,000
    Tucson, AZ, $600,000.--Develop basin-scale simulation models of 
soil- vegetation-atmospheric fluxes of water and energy suitable for 
prediction of climate change impacts.
    Beltsville, MD, $600,000.--Develop models to predict and assess 
impacts of weather variation and a changing climate on soil water 
availability.
    Burns, OR, $600,000.--Develop data bases documenting long term 
effects of greenhouse-induced changes in amounts and patterns of 
precipitation on the productivity and species composition of rangeland 
vegetation.
    El Reno, OK, $600,000.--Develop and apply new genetic improvement 
of forage cultivars tolerant to elevated temperatures, limited 
availability of water, and other extreme environmental conditions.
    Boise, ID, $600,000.--Develop and refine simulation models which 
accurately predict effects of climate change on the availability of 
water from snowmelt in the West.
    Raleigh, NC, $600,000.--Develop data bases to describe effects of 
rising atmospheric carbon dioxide on population dynamics and damage 
inflicted on major crops by insect pests.
    Urbana, IL, $400,000.--Develop the molecular technology required in 
understanding the ``sucrose transporter gene''.
New Technologies for Improving and Expanding Biomass for Energy--
        $3,000,000
    Lincoln, NE, $600,000.--Develop improved varieties and management 
practices for producing switchgrass and other promising grass species.
    Madison, WI $600,000.--Develop processes and machinery for 
harvesting, transporting, and storage of crop residues and dedicated 
energy crops, for biomass separation.
    St. Paul, MN, $600,000.--Develop improved varieties and management 
practices for producing alfalfa and other promising legume species.
    Tifton, GA, $600,000.--Develop more productive varieties and 
improved management practices for switchgrass and other grasses.
    Miss. State, MS, $600,000.--Develop persistent and productive 
legume/grass mixtures for biofuel production.
agricultural genomes--$2,750,000 ($44,936,000 available in fiscal year 
                                 1999)
Genomic Approaches for Improving Economically Important Traits in 
        Livestock, Poultry, and Fish that Affect Animal Health and 
        Economic Yield--$300,000
    Beltsville, MD, $300,000.--Identify genetic basis for mammary gland 
resistance to mastitis and productivity.
Bioinformatic Tools, Biological Databases, and Information Management 
        Technology--$1,100,000
    Clay Center, NE, $500,000.--Develop methods to compare and analyze 
large numbers of DNA sequences for livestock genes, affecting 
production traits.
    Beltsville, MD, $300,000.--Enhance the interconnection and 
interoperability of the GRIN and genome databases.
    Columbia, MO, $300,000.--Develop software to improve the 
statistical precision of mapping genes and locating QTLs.
Genomic Approaches to Characterizing and Improving the Productivity of 
        Microbes of Industrial or Medicinal Importance--$650,000
    Peoria, IL, $350,000.--Apply genomic tools to discover genotypes of 
fungi, bacteria, actinomycete used to produce medicine or industrial 
products by fermentation and other biochemical processes.
    Beltsville, MD, $300,000.--Develop knowledge of the genomes of the 
plant pest nematode, soybean cyst nematode, and of the swine pest 
nematode, Ascaris.
Characterize Genome of Insects which are Pollinators, Either Beneficial 
        or Pests of Crops--$300,000
    Baton Rouge, LA, $300,000.--Apply genomic tools to develop bees 
with resistance to mites and disease.
Functional Genomic Approaches to Manipulating the Function of Important 
        Genes in Crops--$400,000
    Albany, CA, $400,000.--Investigate the congruence of patterns in 
gene expression (as measured by mRNA occurrence).
  food quality protection act implementation--$3,167,000 ($90,992,000 
                     available in fiscal year 1999)
Areawide IPM Programs Demonstrating Alternatives to At-Risk 
        Pesticides--$1,000,000
    Headquarters, $1,000,000.--Develop increased areawide IPM programs 
focused on replacements for at-risk pesticides.
Support for USDA Office of Pest Management Policy--$1,500,000
    Headquarters, $1,500,000.--Support for the USDA Office of Pest 
Management and Policy (OPMP).
Develop IPM Component Technology for Fruits and Vegetables Treated with 
        Organophosphates and Carbamates and for Pests Under Large-Scale 
        Action Agency Eradication or Control Programs--$667,000
    Ft. Pierce, FL, $300,000.--Manage vegetable disease by control of 
vectors and disease transmission.
    College Station, TX, $367,000.--Develop IPM technologies to replace 
malathion for boll weevil control and eradication.
     emerging and exotic diseases, and pests of crops--$8,133,000 
              ($127,702,000 available in fiscal year 1999)
Wheat and Barley Scab--$900,000
    St. Paul, MN, $300,000.--Conduct research on spring wheat genetics 
for resistance to wheat scab.
    Fargo, ND, $300,000.--Conduct research on durham wheat and barley 
for resistance to Fusarium head blight.
    Peoria, IL, $100,000.--Conduct research on control of vomitoxin and 
biocontrol of wheat scab.
    Madison, WI, $75,000.--Conduct research on the molecular biology of 
wheat transformation.
    Albany, CA, $50,000.--Conduct research on wheat genetics for 
resistance to wheat scab.
    Raleigh, NC $75,000.--Conduct research on wheat scab epidemiology 
in the Southeastern U.S.
New Emerging and Exotic Diseases--$600,000
    Charleston, SC, $300,000.--Develop biologically-based control 
measures for management of nematodes and insects of vegetable crops.
    Fort Pierce, FL, $300,000.--Develop improved methods for detection, 
identification, and control of whitefly-transmitted plant viruses.
Emerging and Exotic Weeds/Plant Pests--$2,033,000
    Headquarters, $733,000.--Support scale-up pilot tests for areawide 
IPM implementation.
    Montpellier, FR, $300,000.--Plant ecology and molecular taxomony-
based foreign studies on the biology, genetics, and natural control of 
insect and weed pests in sites of origin.
    Sidney, MT, $700,000.--Develop biologically-based weed IPM with 
emphasis on using plant pathogen agents for rangeland and crop weeds.
    Miami, FL, $300,000.--Conduct biological control research in 
support of APHIS' exotic pest control programs in the Caribbean Basin.
Systematics of Invasive Weeds and Other Pests--$500,000
    Beltsville, MD, $500,000.--Develop the systematics and taxonomy of 
key invading pest species and biological control agents for weed pests.
Rapid Identification, Prevention, and Control of Emerging Exotic 
        Infectious Diseases of Livestock and Aquaculture--$1,300,000
    Orient Point, NY, $1,300,000.--Compare the pathogenesis of new 
variants of classical swine fever (hog cholera) viruses from recent 
Western hemisphere and European outbreaks.
Rapid Identification, Prevention, and Control of Emerging Domestic 
        Infectious and Zoonotic Diseases of Livestock--$900,000
    East Lansing, MI, $300,000.--Develop DNA sequence databases and the 
needed diagnostic tools for investigations of the genetic diversity of 
the retrovirus, avian leukosis subgroup J.
    Ames, IA, $300,000.--Determine how chronic wasting disease is 
transmitted through environmental contamination or animal contact on 
the range.
    Beltsville, MD, $300,000.--Investigate mechanisms of drug 
resistance in coccidia in poultry.
Develop Vaccines for Brucellosis in Wildlife--$1,000,000
    Ames, IA, $1,000,000.--Develop vaccines for brucellosis of 
wildlife.
Livestock Pests--$900,000
    Lincoln, NE, $300,000.--Determine larval breeding sites, and IPM 
strategies to control stable flies.
    Gainesville, FL, $300,000.--Develop wide area projects to control 
fire ants.
    Weslaco, TX, $300,000.--Develop methods to control the small hive 
beetle.
  food safety--$11,720,000 ($69,868,000 available in fiscal year 1999)
Pathogen Control in Fruits and Vegetables--$2,100,000
    Beltsville, MD, $600,000.--Investigate the ecology of foodborne 
pathogens on fresh cut produce to optimize varieties of fruits and 
vegetables.
    Wyndmoor, PA, $900,000.--Develop methods of inhibiting pathogens on 
whole and fresh-cut fruits and vegetables, using irradiation, and steam 
pasteurization.
    Albany, CA, $600,000.--Quantify effects of phytochemicals and 
environmental conditions on growth and survival of E. coli O157:H7, 
salmonella and campylobacter on the surface of fruits and vegetables.
Pathogen Control During Slaughter and Processing--$700,000
    Athens, GA, $700,000.--Develop system for on-line detection of 
unwholesome poultry in slaughter plants.
Investigate Antimicrobial Resistance--$1,620,000
    Wyndmoor, PA, $900,000.--Develop molecular characterization methods 
to facilitate identification of the resistant pathogens detected in 
food.
    Peoria, IL, $720,000.--Establish culture collections of resistant 
and nonresistant bacterial and fungal pathogens.
Manure Handling and Distribution--$2,500,000
    Miss. State, MS, $600,000.--Develop practical and economical 
pathogen reduction process methods to handle and treat manure in 
poultry production operations.
    Ames, IA, $400,000.--Develop practical and economical pathogen 
reduction process methods to handle and treat manure in swine 
production operations.
    Clay Center, NE, $300,000.--Develop practical and economical 
pathogen reduction process methods to handle and treat manure in swine 
production operations.
    Lincoln, NE, $300,000.--Develop practical and economical pathogen 
reduction process methods to handle and treat manure in swine 
production operations.
    Bushland, TX, $600,000.--Develop practical and economical pathogen 
reduction process methods to handle and treat manure in cattle 
production operations.
    Phoenix, AZ, $300,000.--Determine the identity and amounts of 
viable, bacterial, and parasitic, and zoonotic pathogens associated 
with the use of municipal wastewater when used in irrigation of crops.
Antibiotic Resistance--$1,800,000
    Athens, GA, $600,000.--Determine factors favoring the acquisition 
and dissemination of resistance genes among pathogens and nonpathogens, 
particularly for poultry.
    Ames, IA, $600,000.--Determine the factors or conditions favoring 
the acquisition and dissemination of resistance genes among pathogens 
and nonpathogens, particularly in relation to cattle and swine.
    College Station, TX, $600,000.--Develop basic information, using 
chemostat model systems, on the time and dose dependency of various 
antibiotics.
Risk Assessment--$2,400,000
    Athens, GA, $600,000.--Develope data for use in assessing risk on 
the contamination of poultry presented for slaughter.
    West Lafayette, IN, $600,000.--Assess the risk of various swine 
production practices, and transportation systems on contamination of 
the animals as they are presented for slaughter.
    Clay Center, NE, $600,000.--Develop data for use in assessing risk 
on the contamination of cattle as they are presented for slaughter.
    Beltsville, MD, $600,000.--Develop predictive models for the risk 
of transmission of zoonotic parasites through farm management systems, 
animal manure and water runoff.
Reduce Fungal Toxins--$300,000
    Athens, GA, $300,000.--Develop methods to prevent the occurrence of 
endophytic fungi in corn and grasses, in particular those fungi 
producing the fumonisins and ergot alkaloids.
Reduce Zoonotic Disease Risk--$300,000
    Fayetteville, AR, $300,000.--Develop knowledge of diseases in 
chickens and turkeys to prevent the serious manifestations of 
osteoporosis, anoxia, and ascites.
  human nutrition--$20,250,000 ($69,121,000 available in fiscal year 
                                 1999)
    phase 3 of the president's human nutrition research initiative--
                              $20,250,000
Update the National Nutrient Database--$2,200,000
    Beltsville, MD, $2,200,000.--Analyze the nutrient content of those 
key foods that supply the bulk of the important nutrients in the 
American diet.
Development of Food Composition Methods--$1,200,000
    Beltsville, MD, $1,200,000.--Develop robust analytical methods to 
determine the concentration of nutrients in foods.
Determination of Healthy Body Weight--$2,500,000
    Beltsville, MD, $600,000.--Investigate energy restriction and 
physical activity as they relate to tissue metabolic activity and body 
composition.
    Houston, TX, $600,000.--Identify the alterations in biochemical and 
neuropsychological regulators of energy intake, energy expenditure and 
appetite that relate to childhood obesity.
    San Francisco, CA, $700,000.--Assess detrimental energy effects 
including reduced immune response, diminished short term memory and 
reduced energy needs.
    Little Rock, AR, $600,000.--Study the interaction of diet with the 
long term physical and cognitive indicators of health in older 
children.
Role of Nutrition in Bone Growth and Maintenance--$3,600,000
    Boston, MA, $1,200,000.--Assess the requirements for nutrients 
critical to bone health and the prevention of osteoporosis in aging 
adults.
    Houston, TX, $1,200,000.--Determine factors that affect the ability 
of rapidly growing children to absorb and utilize minerals from animal 
and vegetable sources for the formation of bone.
    Grand Forks, ND, $600,000.--Assess the role of mineral elements and 
their interactions relative to bone growth.
    Little Rock, AR, $600,000.--Determine the effects of early dietary 
factors on long-term consequences of bone growth.
Development of Biomarkers of Nutritional Status--$3,500,000
    Beltsville, MD, $700,000.--Study the relationship between immune 
competence and diet.
    Houston, TX, $600,000.--Study the effects of colostrum and other 
dietary factors on skeletal muscle protein in the rapidly growing 
neonate.
    San Francisco, CA, $1,200,000.--Identify sensitive biomarkers that 
are indicative of health promotion.
    Grand Forks, ND, $1,000,000.--Identify the regulatory genes of 
importance that are responsive to trace minerals in the diet.
Cognition and Brain Function--$3,450,000
    Boston, MA, $500,000.--Assess dietary factors that alter vascular 
reactivity and brain function in the elderly.
    Grand Forks, ND, $600,000.--Study the relationship between mineral 
nutriture and cognitive function including reasoning, memory and visual 
perception.
    Little Rock, AR, $1,700,000.--Study cognitive and social 
development of growth delayed in malnourished infants and children.
    Little Rock, AR, $650,000.--Determine the precise relationship 
between nutrients in the diet and the development of cognition in 
children.
Diet and Immune Function--$2,100,000
    San Francisco, CA, $900,000.--Define the relationship between 
nutrition and the induction of the synthesis of immunoglobulins.
    Boston, MA, $300,000.--Determine changes in the immune response 
that occur throughout the aging process.
    Beltsville, MD, $500,000.--Expand studies of the effect of 
nutritional status of a host on viral pathogen.
    Little Rock, AR, $400,000.--Determine foods in the diets of young 
children that have a positive effect on growth and development.
Role of Nutrition Throughout the Life-Cycle--$1,300,000
    Houston, TX, $800,000.--Define the relationship of nutritional 
status at various stages of childhood.
    Boston, MA, $500,000.--Develop measures which help delineate the 
relationship between diet and the development of vascular dementia in 
the elderly, and between diet and the rate of physical form and 
function in the elderly.
Enhanced Dietary Survey Methodology--$400,000
    Beltsville, MD, $400,000.--Continue development of telephone 
technology for use in dietary surveys with the aim of reducing cost and 
improving accuracy.
 agricultural information--$2,000,000 ($19,948,000 available in fiscal 
                               year 1999)
Information Services for Rural America--$2,000,000
    NAL, $2,000,000.--Develop enhanced methods to communicate critical 
agricultural information to rural America.
    TOTAL ALL PROGRAM INCREASES: $76,420,000
    Question. An increase of $8.1 million is proposed for fiscal year 
2000 for research on emerging diseases and exotic pests. Provide a 
summary of total ARS funding for emerging diseases and exotic pests for 
each of fiscal years 1998 and 1999 and that requested for fiscal year 
2000, along with a brief description of the project and where the 
research is currently being conducted, or is proposed to be conducted.
    Answer. The Agricultural Research Service devoted $109,772,700 in 
fiscal year 1998, $127,701,500 in fiscal year 1999, and proposes 
$148,273,000 in fiscal year 2000 for research on emerging diseases and 
exotic pests. A description of the current research and the locations 
where the research is being conducted is provided for the record.
    [The information follows:]

        Location/Research Description             Fiscal year 1999 funds
Auburn, AL (Aquaculture diseases, diagnosis and 
    prevention).........................................      $1,913,700
Fayetteville, AR (Food safety/pathogen reduction in 
    poultry)............................................         293,800
Albany, CA (Food safety/pathogen reduction in fruits and 
    vegetables/yellowstar thistle/salt cedar )..........       6,180,900
Davis, CA (Control of diseases of perennial crops)......          70,600
Fresno, CA (Alternatives to Methyl Bromide).............         762,300
Funds Riverside, CA (Food safety/pathogen reduction in 
    fruits, vegetables, beef and poultry/animal manure/
    alternatives to Methyl Bromide).....................         734,100
I89 Salinas, CA (Alternatives to Methyl Bromide)........         428,700
Fort Collins, CO (Diseases of sugar beets)..............         242,100
Washington, DC (Control of diseases of ornamentals/
    alternatives to Methyl Bromide).....................         952,600
Newark, DE (Quarantine clearance, biology and ecology)..       1,018,300
Canal Point, FL (Control of sugarcane diseases).........         123,400
Fort Lauderdale, FL (Control of wetland and aquatic 
    weeds)..............................................         749,700
Gainesville, FL (Control of arthropod pests of livestock 
    and humans).........................................       5,633,400
Orlando (Ft. Pierce, FL) (Alternatives to Methyl 
    Bromide)............................................         939,900
Athens, GA (Food safety/pathogen reduction in poultry)..      10,058,400
Byron, GA (Control of nematodes and diseases of peaches)         209,700
Griffin, GA (Quarantine clearance/disease 
    identification).....................................          82,800
Tifton, GA (Integrated nematode management on irrigated 
    crops and control of diseases of forage and turf)...         633,000
Ames, IA (Zoonotic diseases such as brucellosis, 
    leptospirosis, tuberculosis and infectious diseases 
    of cattle and swine/food safety/pathogen reduction 
    in cattle and swine)................................      20,570,100
Peoria, IL (Infectious diseases of livestock/biological 
    control of root and tuber diseases).................       1,238,900
Urbana, IL (Control of Soybean Cyst Nematode)...........         112,000
West Lafayette, IL (Food safety/pathogen reduction in 
    swine)..............................................         296,400
New Orleans, LA (Control of diseases and insects in 
    sugarcane)..........................................         219,300
Beltsville, MD (Systematics, biology, ecology and 
    management of plant diseases and pests/parasitic 
    diseases/mastitis/food safety/pathogen reduction in 
    swine, fruits and vegetables).......................      18,852,900
Frederick (Ft. Detrick, MD) (Pathogen quarantine 
    clearance, biology and ecology).....................       1,414,400
East Lansing, MI (Tumorigenic viruses of poultry).......       2,088,600
St. Paul, MN (Control of forage disease)................          52,900
Columbia, MO (Stress in pigs)...........................         617,600
Mississippi State, MS (Control of mycoplasmosis in 
    poultry)............................................         544,900
Oxford, MS (Biological control of pests and diseases)...         277,700
Funds Stoneville, MS (Application technology and 
    bioherbicides/control of Soybean Cyst Nematode).....         248,600
Sidney, MT (Control of rangeland weeds).................         694,900
Raleigh, NC (Control of diseases in wheat)..............         146,100
Fargo, ND (Food safety/toxins/leafy spurge).............         296,400
Clay Center, NE (Herd health/food safety/pathogen 
    reduction in cattle)................................       5,191,600
Lincoln, NE (Control of livestock pests)................       1,031,200
Ithaca, NY (Control of potato nematodes and diseases/
    small grain viruses/grape rootstocks................      1,496,100)
Orient Point, NY (Highly infectious exotic animal 
    diseases)...........................................       9,678,300
Wooster, OH (Pesticide application technology/control of 
    corn virus diseases)................................         271,600
Stillwater, OK (Control of Russian Wheat Aphid).........         196,600
Corvallis, OR (Control of diseases in nursery crops, 
    ornamentals and small fruits).......................       1,448,600
Wyndmoor, PA (Food safety/pathogen reduction in animal 
    products, fruits and vegetables)....................       8,692,900
Charleston, SC (Control of nematodes and diseases of 
    vegetables).........................................         486,600
College Station, TX (Food safety/pathogen reduction in 
    poultry, swine and cattle/application technology/
    control of cotton disea- 
    ses)................................................       4,407,500
Kerrville, TX (Integrated pest management of ticks and 
    biting 
    flies)..............................................       4,338,500
Lubbock, TX (Food safety/pathogen reduction of cattle)..         281,600
Temple, TX (Biological control of salt cedar and musk 
    thistle)............................................         147,200
Weslaco, TX (Integrated production systems).............         594,600
Logan, UT (Food safety/poisonous plants effect on 
    livestock)..........................................          63,600
Prosser, WA (Potato variety improvement)................         384,200
Pullman, WA (Control of smut diseases of grains/
    tickborne diseases/transmissible spongiform 
    encephalopathy).....................................       3,277,600
Wenatchee, WA (Control of diseases of tree fruits)......         344,000
Kearneysville, WV (Fruit production and disease control)         677,200
Laramie, WY (Vector-borne diseases of livestock)........       3,454,700
Buenos Aires, Argentina (Foreign exploration, biology, 
    ecology, testing, and shipment).....................         507,000
Montpellier, France (Foreign exploration, biology, 
    ecology, testing and shipment)......................       1,051,000
Panama City, Panama (Screwworm eradication).............         980,200
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     127,701,500

    A description of the proposed research and the locations where the 
research is being proposed to be conducted which is included in the 
fiscal year 2000 Emerging Diseases and Exotic Pests increase is 
provided for the record.
    [The information follows:]

Emerging diseases and exotic pests

Emerging exotic infectious diseases of livestock: Orient 
    Point, NY--Hog cholera pathogenesis and vaccines..........$1,300,000
                    ==============================================================
                    ____________________________________________________
Emerging domestic infectious and zoonotic diseases of 
    livestock:
    E. Lansing, MI--Avian Leukosis J virus diagnosis and 
      vaccines................................................   300,000
    Ames, IA--chronic wasting disease control.................   300,000
    Beltsville, MD--drug resistance in coccidia of poultry....   300,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   900,000
                    ==============================================================
                    ____________________________________________________
Vaccines for brucellosis in wildlife: Ames, IA--brucellosis 
    vaccines for wildlife..................................... 1,000,000
                    ==============================================================
                    ____________________________________________________
Livestock pests:
    Lincoln, NE--integrated pest management of stable flies on 
      cattle..................................................   300,000
    Gainesville, FL--fire ants control........................   300,000
    Weslaco, TX--control of small hivebeetle (pest of bees)...   300,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   900,000
                    ==============================================================
                    ____________________________________________________
Emerging and exotic plant pests/weeds:
    Headquarters--areawide IPM implementation.................   733,000
    Montpellier, FR--plant ecology and molecular taxonomy.....   300,000
    Sidney, MT--biologically-based weed IPM...................   700,000
    Miami, FL--biological control of pests in Caribbean Basin.   300,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 2,033,000
                    ==============================================================
                    ____________________________________________________
New emerging and exotic plant diseases:
    Charleston, SC--biological control of nematodes and 
      insects.................................................   300,000
    Fort Pierce, FL--whitefly-transmitted plant viruses.......   300,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   600,000
                    ==============================================================
                    ____________________________________________________
Wheat and barley scab:
    St. Paul, MN--spring wheat genetics for wheat scab........   300,000
    Fargo, ND--fusarium head blight...........................   300,000
    Peoria, IL--vomitoxin and biocontrol of wheat scab........   100,000
    Madison, WI--molecular biology of wheat transformation....    75,000
    Albany, CA--wheat genetics................................    50,000
    Raleigh, NC--wheat scab epidemiology......................    75,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................   900,000
                    ==============================================================
                    ____________________________________________________
Systematics of invasive weeds/pests: Beltsville, MD--
    systematics and taxonomy..................................   500,000
                    ==============================================================
                    ____________________________________________________
      Total................................................... 8,133,000

    Question. What has been accomplished through research on emerging 
and exotic pests?
    Answer. Key accomplishments of ARS research on emerging and exotic 
pests and weeds include establishment of nine biological control agents 
against leafy spurge, a major weed that costs ND, SD, MT and WY alone 
$144.4 million/year. Biological control with co-evolved natural enemies 
is the only option for affordable, sustainable, and environmentally 
compatible leafy spurge management. For example, the introduced flea 
beetles (Aphthona spp.) cause 80 percent reduction of leafy spurge at 
release sites. A TEAM Leafy Spurge group has been formed to manage ARS' 
newest areawide pest management program (AWPM), against leafy spurge. 
Biological, chemical and cultural control of leafy spurge is managed as 
part of the ARS-funded ($4.5 million over five years) TEAM Leafy Spurge 
project, which involves other Federal agencies and States.
    Another major accomplishment is the establishment of a weevil 
against the Australian plant melaleuca, a major wetlands invasive 
exotic weed in the Florida Everglades. Early damage on melaleuca by the 
weevil is significant. Melaleuca has changed the drainage in a large 
part of southern Florida: it spreads at the rate of 50 acres/day, and 
occupies 500,000 acres of native wetlands. Biological control is the 
only option for long-term, affordable, environmentally compatible 
management of melaleuca, and several other natural enemies are slated 
for release over the next several years.
    Waterhyacinth, an invasive floating aquatic weed from South 
America, has been managed by the introduction of two weevil species, 
saving the southeastern U.S. millions of dollars, and reducing pressure 
on native aquatic and wetlands plants. This technology has been 
transferred to other countries (e.g., Australia and Africa) to help 
manage waterhyacinth.
    Many other invasive weed species infest large portions of the U.S., 
causing loss of productivity and biological diversity, displacement of 
native vegetation, and job loss. There are annual losses of $13 billion 
from weeds in the U.S.
    Pests such as codling moth, corn rootworm, stored grain insects, 
corn earworm/tobacco budworm, Russian wheat aphid, Colorado potato 
beetle, boll weevil, sweetpotato whitefly, and fruit flies are targets 
of the successful ARS AWPM programs. As with the leafy spurge AWPM 
program, these projects are funded at about $1 million/year for five 
years, about half of which funds work by partners in other Federal 
agencies and States. As examples of accomplishments of the ARS AWPM 
program, details of two of these projects follow.
    Codling moth is a serious pest of apples and pears in the U.S. In 
1994, before the AWPM program was initiated, only 11,000 acres were 
treated with mating disruption technology in Washington State. By 1998, 
there were more than 44,000 acres using the technology throughout 
Washington, Oregon, and California. A result of the diminished use of 
hard pesticides has been a resurgence in the natural enemy populations 
that have exerted almost complete control of secondary pests, and 
further reduced the costs of insect control on apples and pears in this 
three-state area. Populations of codling moth were reduced to almost 
undetectable levels at some of the 17 project sites. The cost of the 
control was less in the mating disruption treated orchards than in 
orchards treated with conventional organo-phosphate pesticides.
    Corn rootworm populations can be reduced by 85 to 95 percent with 
less than 10 percent of the chemicals used in current corn rootworm 
control regimes by using adult attracticide baits developed by ARS and 
now marketed by industry. This technology is the basis for the AWPM 
program on corn rootworm in the midwestern U.S. and Texas, which 
includes more than 25,000 acres in the research demonstration project.
    The ARS research on invasive pests has led to a better 
understanding of the ways that these pests are introduced into the U.S. 
(leading to better exclusion techniques), eradication of incipient 
populations before they become pests, and management of established 
populations through biologically based integrated pest management. ARS 
plans and implements management of invasive species by closely working 
with customers and partners such as the USDA-Forest Service, USDA-
Animal and Plant Health Inspection Service, universities and State 
departments.
    Question. What new threats of plant and animal diseases and pests 
has the agency identified and what new and expanded research 
initiatives are proposed to address these problems?
    Answer. Plant Pests.--New invasive species are discovered every 
month in the U.S. ARS has proposed several new initiatives to control 
these threats as they occur. Recently, for example, giant salvinia was 
discovered in Louisiana and Texas. This invasive floating weed from 
Brazil was successfully managed in Australia, Papua New Guinea and 
Africa by introduction of a small weevil in a biological control 
program. A USDA-State team is in the process of developing an 
integrated weed management program for the U.S.
    The Asian gypsy moth, a close relative of the gypsy moth, is 
periodically discovered in the U.S. This species could further 
devastate trees in the U.S. However, rapid detection and eradication by 
USDA and States has prevented its establishment.
    Programs are developed in advance of threats of invasion by key 
pest species. For example, ARS and APHIS, together with international 
colleagues, implemented a biological control program for the pink 
hibiscus mealybug in the Caribbean that resulted in management of this 
pest. Should the mealybug arrive in the U.S., the biological control 
technology is already available to quickly manage the pest.
    New threats from other invasive weeds such as salt cedar, mile-a-
minute weed, kudzu, Chinese tallow, tropical soda apple and other 
related species, and miconia, and insects such as the Asian longhorned 
beetle, giant whitefly, etc., continue to invade the U.S. Research 
initiatives concentrating on learning more about the basic biology, 
systematics, and ecology of these invasive species, leading to 
implementation of biologically based integrated pest management 
programs have been proposed for each region of the country.
    ARS has approximately 70 projects at 29 locations conducting basic 
and applied research directly related to integrated pest management 
(IPM). Current and planned future IPM studies in support of the 
Department's IPM goal are tailored to each pest and designed to be 
sustainable over time.
    Animal Diseases.--Changes in animal production practices, climate 
change, and increased international trade and travel are creating new 
opportunities for the reemergence and spread of infectious diseases and 
pests. Control of diseases is needed in both domestic and wild animals, 
as the latter are reservoirs of disease. Emerging threats have been 
identified from avian leukosis, chronic wasting disease of cervids, 
drug-resistant coccidiosis, wildlife brucellosis, and stable flies.
New and expanded program thrusts include:
    Research to develop a new generation of biochemical and DNA based 
diagnostic tools for sensitive and rapid detection of exotic pathogens 
and to develop new vaccines.
    Identification, prevention, and control of emerging domestic 
infectious and zoonotic diseases of livestock and aquaculture, 
including avian leukosis, chronic wasting disease, and coccidiosis.
    Development of vaccines for brucellosis in wildlife.
    Control of livestock pest flies through biologically based IPM 
strategies.
                               pay costs
    Question. ARS is requesting $9,930,000 to finance pay costs for 
fiscal year 2000. Is this the total required to meet the cost of 
mandatory pay requirements? If not, what additional amount would be 
required to meet these costs? If the full amount is not being provided, 
what will the impact of absorbing these mandatory pay requirements?
    Answer. The $9,930,000 represents half of the total required to 
meet the cost of the mandatory, pay requirements in fiscal year 2000. 
An additional $8,768,000 is required to fully finance pay cost needs of 
$18,698,000. These funds are critical to support an effective and 
responsive USDA in-house research capability. Absorption of the pay 
costs will result in further erosion of the Agency's capacity to 
maintain viable research programs. To cover these anticipated pay 
increases, resources will have to be shifted from other research 
requirements such as: travel, equipment, supplies, contracts, etc., 
thereby impacting the productivity of many ARS locations. Continuing 
absorption of these costs consequently reduces the number of scientists 
and support personnel who can be supported with ARS funds. These 
individuals are needed to carry out the USDA in-house research mission 
and objectives.
    Question. Provide a table showing historical data for each fiscal 
year from 1992 to 2000: (1) ARS pay cost requirements; (2) the funding 
requested in the President's budget to meet these requirements; and (3) 
the amount appropriated to meet these costs.
    Answer. The information you requested is provided for the record.
    [The information follows:]

                                          AGRICULTURAL RESEARCH SERVICE
                                               [Pay cost history]
----------------------------------------------------------------------------------------------------------------
                                                                      Agency        President's
                              Years                                Requirements   Budget Request   Appropriated
----------------------------------------------------------------------------------------------------------------
2000............................................................     $18,698,000      $9,930,000  ..............
1999............................................................      14,805,000      12,201,000  ..............
1998............................................................      17,021,000       6,407,000  ..............
1997............................................................      11,745,000       6,576,000  ..............
1996............................................................       9,703,000       9,091,000  ..............
1995............................................................      11,119,000       4,201,000      $4,202,000
1994............................................................      19,705,000       8,628,000  ..............
1993............................................................      17,328,000       7,387,000  ..............
1992............................................................      16,281,000      16,042,000      16,042,000
----------------------------------------------------------------------------------------------------------------

    Question. Provide a short explanation for each of fiscal years 1995 
to 1999 of how pay costs were absorbed by the agency and the 
consequences of absorption of these costs on agency operations and 
activities, including research productivity and the hiring of 
scientists.
    Answer. As indicated in the preceding table, ARS has absorbed some 
$60 million of costs associated with mandatory Federal pay raises from 
1995 through 1999. These costs were absorbed by every ARS research 
laboratory throughout the Agency. Each laboratory was required to 
finance the costs of increased salaries and benefits within its 
operating budget. Financial plans for each year reflected reductions in 
other important research expenditures to accommodate these increased 
costs. Expenditures pursuant to research--travel, scientific equipment, 
cooperative agreements, research supplies, hiring of full-time and 
temporary personnel, and post-doctoral support--have been reduced to 
pay the higher personnel compensation due to pay raises. Research 
productivity is seriously eroded under these circumstances.
    Because program increases are generally directed to specific 
locations, most ARS locations and research units do not benefit from 
annual appropriation increases and are facing tight financial 
situations.
    In order to hire replacement scientists ARS must have the assurance 
that the funding will be available to fully support scientist needs 
required in attaining their research mission. Because of these 
absorptions, many research units have not been able to fill scientific 
and technical positions. Research units cannot effectively hire 
scientists and provide the adequate funding necessary for essential 
laboratory and operating costs. Research is curtailed; productivity at 
the bench is diminished; and benefits postponed.
        ars role in counter-narcotics/anti-bioterrorism research
    Question. For fiscal year 1999, $23 million in emergency 
supplemental appropriations, along with an additional $4.5 million 
transfer of funds from the Office of National Drug Control Policy 
(ONDCP) has been made available to the ARS for counter-narcotics 
research. Provide a detailed description of the research work this 
funding is being used to support, the amount of funds allocated to each 
project, and who will conduct this work. Please show the allocation of 
the $4.5 million transferred from the Office of National Drug Control 
Policy separately from the allocation of the $23 million emergency 
appropriations.
    Answer. Of the allocation of $23 million, $10 million was earmarked 
for an external contract for the biological control of coca, opium and 
cannabis; $5 million to ARS for herbicidal and biological control 
research; $5 million to ARS for alternative crop research; and, $3 
million to ARS for research on illicit narcotic plant chemistry, remote 
sensing and illicit crop estimation.
    Specific allocations are as follows:
Herbicidal and Biological Control of Narcotics, $5,000,000
    Frederick, MD: $2,000,000 to investigate augmentative biological 
control of poppy
    Stoneville, MS: $1,000,000 to investigate augmentative biological 
control of coca and cannabis
    Albany, CA: $1,000,000 to investigate classical biological control 
of poppy, coca and cannabis
    Headquarters: $1,000,000 for cooperative agreements on foreign 
exploration, host specificity testing, and mass rearing of biological 
control agents for narcotic plants
Alternative Crop Research, $5,000,000
    Beltsville, MD: $500,000 to determine Phytopthora resistance in 
potato and cacao
    Miami, FL: $300,000 to develop DNA markers of cacao resistance to 
Crinipellis, Phytopthora and Moniliopthora
    Ft. Pierce, FL: $300,000 to develop disease resistance in tropical 
tree fruit crops
    Mayaguez, PR: $500,000 for breeding resistance in tree crops, 
including cacao and banana, mango, mangosteen and papaya
    Starkville, MS: $300,000 to develop coffee berry borer artificial 
diet for biological control purposes
Organization of American States: $666,667 for field trials in Peru for 
        the biological control of cacao pests
    USDA/APHIS: $100,000 for assistance in tropical crop export 
promotion in Peru
    University of Mississippi: $194,444 for biocontrol of cannabis
    CABI Biosciences, U.K.: $888,889 to conduct cacao breeding, 
resistance field trials and biological control assessments
    University of Maryland: $1,250,000 to develop predictive models of 
the epidemiology of tropical crop diseases in Colombia
Narcotic Plant Biochemistry and Identification, $3,000,000
    Beltsville, MD: $500,000 to develop test models for relating opium 
gum yield to capsule size for worldwide opium production estimates
    Beltsville, MD: $1,500,000 to develop molecular markers that 
characterize coca, opium poppy and cannabis populations, species and 
cultivars in their different native and introduced areas
    Beltsville, MD: $1,000,000 to test and refine yield models of 
narcotic crops, gather data to enhance model performance, combine 
models with weather and topographic data for predictive data, examine 
multispectral data for remote sensing of narcotic crops
Biological Control Contract, $10,000,000
    Contract: $10,000,000 for a contract for product development, 
environmental testing, registration, production, aerial distribution, 
evaluation of product effectiveness and modification of biological 
control agents of coca, opium poppy and cannabis.
    The allocation of $4.5 million was provided through the ONDCP to 
ARS by means of an interagency transfer of funds. Specific allocations 
are as follows:
    Beltsville, MD: $2,337,000 for construction and instrumentation of 
containment greenhouse facilities
    Beltsville, MD: $166,000 for equipment associated with containment 
greenhouse operations and a research field site at the University of 
Hawaii, Kauai
    Beltsville, MD: $166,000 for postdoctoral position to work on 
mycoherbicides and alternative crops
    Stoneville, MS: $222,000 for a cooperative agreement with 
University of Mississippi on the use of fungi to control cannabis 
production
    Starkville, MS: $333,000 for a cooperative agreement with 
Mississippi State to work with Colombian counterparts on coffee berry 
borer parasatoids as biological control agents for coffee pests
    Miami, FL: $166,000 for cooperative agreement with University of 
Florida to identify genetic markers for resistance to crinipellis in 
cocoa
    Centro Internationale Agropecuria Tropicale, Colombiam: $277,000 to 
evaluate market growth potential for cocoa, oil palm, and field trials 
for temperate and tropical tree fruit crops
    U.S. Department of State, Bureau of International Narcotics: 
$500,000 for a cooperative agreement with the United Nations Drug 
Control Program for monitoring biological control tests overseas
    Bozeman, MT: $333,000 for cooperative agreement with Montana State 
University to enhance the efficiency, yields, alkaloid extraction and 
processing capability of the licit opium industry in Turkey
    Question. Because the fiscal year 1999 funding made available to 
the ARS for counter-narcotics research is one year emergency funding, 
what is ARS doing to make sure that this funding does not increase the 
agency's base requirements for fiscal year 2000?
    Answer. Without an increase in base funds, we will not implement 
the program with an increase in permanent staff. Of the $23 million, 
Congress earmarked $10 million for a biological control contract. Once 
awarded, the contract will be self-sustaining and will not increase ARS 
base resource requirements. The balance of the funds ($13 million) is 
earmarked for $5 million in alternative crop research, $5 million in 
illicit crop eradication research and $3 million for narcotic plant 
chemistry, remote sensing, illicit crop detection and worldwide illicit 
crop estimates. In addition to some purchases for equipment, the 
research will primarily be carried out through extramural agreements 
and limited-term, in-house, post-doctoral appointments. Extramural 
agreements will run for a period of five years and then expire; post-
doctoral appointments for two years.
    Question. Does the Department believe the Agricultural Research 
Service should be involved in counter-narcotics research? If so, what 
should be its role?
    Answer. ARS should be involved in counter-narcotics research. The 
agency serves in a research support role to federal and international 
action agencies. ARS has unique expertise which makes the agency well-
qualified to work in the plant sciences, which includes narcotic crops. 
For example, our expertise in plant pathology allows us to support 
programs in the development of biological control technologies for 
narcotic crops and research into diseases which affect tropical 
agriculture, specifically, alternatives to narcotic crop cultivation. 
Similarly, plant genetics are applied to improving varieties of coffee, 
cocoa and tropical tree crops, essential to developing the economies of 
many Andean and Central American economies. The agency has significant 
experience in spectral imaging of vegetation in mixed environments, as 
well as crop modeling, which is directly applicable to illicit crop 
estimation and detection. Our experience in weed science and herbicide 
application technology has direct impact upon the eradication programs 
for coca and opium, currently being implemented in Colombia.
    ARS has a long history in narcotic plant research beginning with 
assisting the United Nations and Drug Enforcement Administration in 
evaluating strategies for the eradication of illicit narcotic crops and 
developing alternative crops, primarily in Thailand. Currently, our 
mission continues to be one of support of U.S. and international action 
and policy agencies, including the Office of National Drug Control 
Policy, the Department of State, United Nations Drug Control Program, 
and the U.S. intelligence community.
    Question. Is the Agricultural Research Service involved in the 
Administration's bioterrorism initiative? If so, what is the role?
    Answer. While ARS has no specific line item appropriation in 
support of the Administration's bioterrorism initiative, the Agency is 
actively involved in this program. The agricultural sector must play an 
integral part in the development of a coordinated, comprehensive 
national strategy to protect the security of the nation's food supplies 
in the event of a bioterrorism emergency. To this end, ARS has worked 
vigorously to have food and agriculture recognized as a critical 
infrastructure. In this regard, the Agency is posturing itself to 
engage this issue more directly, both internally and externally in 
terms of program and infrastructure requirements.
    Naturally occurring pathogens and pests which could be used as 
biological agents against agriculture are widely available in foreign 
countries. Also, technologies, expertise, and delivery platforms 
related to many types of biological and chemical weapons are commonly 
employed in normal commercial agricultural practice world wide.
    ARS' ongoing mission is highly relevant to the Administration's 
bioterrorism initiative. The research to protect crops and livestock 
from the farm gate to the consumer's table is a priority concern. ARS 
research on emerging exotic diseases of livestock carried out at the 
Plum Island Animal Disease Center and the National Animal Disease 
Center are central to this effort. Research carried out at other ARS 
laboratories on wheat scab, for example, is pertinent to the 
bioterrorism concern. Invasive species of agricultural crops is also 
central to this issue. The ARS infrastructure is of critical importance 
in assessing vulnerabilities to bioterrorism. The upgrade and 
modernization of ARS laboratories is also essential to this program. In 
fact, biocontainment capabilities at a number of ARS research 
locations--including the Plum Island Animal Disease Center to the 
National Animal Disease Center--can serve as the primary means for 
supporting the characterization of biological weapons-related pathogens 
in the event of a bioterrorism incident.
                               management
    Question. ARS does not receive separate appropriations for its 
management and overhead expenses. How are these costs funded?
    Answer. ARS program and administrative management activities 
include the Administrator's Office; National Program Staff; Civil 
Rights Staff; Information Staff; Office of Technology Transfer; Budget 
and Program Management Staff; Eight Area Directors' and Administrative 
support; Human Resources Management; Information Technology Division; 
Procurement and Property Division; Extramural Agreements Division; 
Financial Management Division and Facilities Division. In addition to 
support of these internal management organizations, ARS finances its 
share of departmental assessments for such operations as the National 
Finance Center, computer centers, central supply, telephone services, 
security, etc. ARS, like a number of other agencies in the Department 
of Agriculture, does not have a line item or direct appropriations to 
finance costs associated with the program and administrative management 
activities necessary to support the Agency's mission. Historically, 
management costs in ARS have been financed through the assessment of 
research programs carried out by the agency. Costs associated with the 
support of program and administrative activities represents about 10 
percent of the Agency's annual appropriated funds.
    Question. Please provide an accounting of management and overhead 
expenses for fiscal year 1998.
    Answer. The information you requested is provided for the record.
    [The information follows:]

Program and Administrative Management Costs

                                                        Fiscal Year 1988
        Organization/Functions                               Obligations
Office of the Administrator (Immediate Office, Office of 
    Technology Transfer, Civil Rights Staff, Budget and 
    Program Management Staff)...........................      $5,276,250
Information Staff.......................................       3,211,598
National Program Staff..................................       7,356,599
Administrative and Financial Management (Office of 
    Deputy Administrator, Human Resource Management, 
    Financial Management, Facilities Division, Contracts 
    and Extramural Agreements, Information Technology, 
    and Procurement and Property Administration)........      18,805,349
Area Program and Administrative Management (Area 
    Directors, Associated Administrative Staffs)........      16,396,600
USDA Central Charges (NFC, Computer Center, Central 
    Supplies, Telephone Service, Security, etc.)........       9,871,968
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      60,918,364

    Question. How does the ARS cover indirect research costs? Please 
show an accounting of these costs for fiscal year 1998.
    Answer. ARS indirect research assessment provides for program and 
management of ARS's national and international research mission. These 
costs represents approximately 10 percent of the Agency's 
appropriations. The ARS program and management costs are reviewed 
annually and the indirect support rate represents a viable assessment 
needed to administer the ARS mission. An accounting of these costs is 
reflected in the previous response.
    Question. How much money budgeted for positions was due to 
``lapse'' at the end of each of fiscal years 1997 and 1998?
    Answer. Fiscal year 1997 and 1998 lapsed salaries totaled 
$7,850,700 and $11,791,100, respectively. This represents 60 percent of 
the total lapse salary accrual which was managed from ARS Headquarters. 
The 40 percent balance of the accrued lapsed salaries were retained and 
used by local managers.
    Question. How were the funds projected to ``lapse'' spent in each 
of fiscal years 1997 and 1998? Please provide a list of items funded 
and the amount provided for each, by fiscal year and location.
    Answer. The fiscal year 1997 lapsed salaries were spent as follows:

Research Equipment:s                                               Funds
    Akron, CO.................................................   $75,000
    Ames, IA..................................................   296,800
    Auburn, AL................................................    70,000
    Beltsville, MD............................................   570,000
    Boston, MA................................................    20,000
    Brookings, SD.............................................    35,000
    Brooksville, GA...........................................    75,000
    Clemson, SC...............................................    40,000
    College Station, TX.......................................    44,500
    Columbia, MO..............................................    96,100
    Columbus, OH..............................................     9,300
    Coshocton, OH.............................................    15,500
    Davis, CA.................................................    70,000
    Dawson, GA................................................    41,300
    E. Lansing, MI............................................    17,000
    Fargo, ND.................................................   172,000
    Ft. Collins, CO...........................................    91,000
    Grand Forks, ND...........................................    30,000
    Ithaca, NY................................................    50,300
    Lincoln, NE...............................................    56,000
    Lubbock, TX...............................................    97,600
    Madison, WI...............................................    74,500
    Miles City, MT............................................    29,500
    New Orleans, LA...........................................   178,000
    Orient Pt., NY............................................    74,300
    Oxford, MS................................................    60,000
    Peoria, IL................................................   332,200
    Raleigh, NC...............................................    30,000
    Stillwater, NC............................................    46,600
    St. Paul, MN..............................................    44,000
    Temple, TX................................................     6,500
    Tifton, GA................................................   178,000
    Tucson, AZ................................................   150,000
    Urbana, IL................................................     8,000
    Weslaco, TX...............................................    69,000
    Wooster, OH...............................................    84,100
    W. Lafayette, IN..........................................    80,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Research Equipment................................ 3,417,100

Facilities Repair & Maintenance/Upkeep:
    Beckley, WV...............................................    85,000
    Brookings, SD.............................................    25,000
    College Station, TX.......................................    12,000
    Columbia, MO..............................................    43,000
    Durant, OK................................................    46,500
    Fargo, ND.................................................   158,000
    Ithaca, NY................................................    72,000
    Manhattan, KS.............................................    30,000
    Greenport, NY............................................. 1,142,300
    Peoria, IL................................................    51,000
    Pullman, WA...............................................    35,000
    Riverside, CA.............................................   138,000
    Yakima, WA................................................   221,000
    National Agricultural Library.............................    75,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Facilities Repair & Maintenance/Upkeep............ 2,133,800

Operating Expenses:
    Ames, IA..................................................    35,000
    Athens, GA................................................   377,200
    Auburn, AL................................................    15,000
    Beltsville, MD............................................   577,500
    Brooksville, GA...........................................    30,000
    Canal Pt., FL.............................................     9,000
    Durant, OK................................................    50,000
    Griffin, GA...............................................    26,300
    Honolulu, HI..............................................     9,500
    Ithaca, NY................................................    50,900
    Logan, UT.................................................    35,000
    Lubbock, TX...............................................    47,000
    Madison, WI...............................................    14,000
    Phoenix, AZ...............................................    54,900
    Prosser, WA...............................................    26,500
    Pullman, WA...............................................    49,000
    Sidney, MT................................................    27,500
    Stoneville, MS............................................    50,000
    Stillwater, OK............................................    70,000
    Stuttgart, AR.............................................    35,000
    Tifton, GA................................................    48,000
    Weslaco, TX...............................................    10,000
    National Agricultural Library.............................   119,900
    Headquarters..............................................   532,600
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Operating Expenses................................ 2,299,800
                    ==============================================================
                    ____________________________________________________
      Total fiscal year 1997 Use of Salary Lapse...........\1\ 7,850,700

\1\ This represents 60 percent of the total lapse salary accrual which 
was managed from ARS Headquarters. The 40 percent balance of the accrued 
lapsed salaries were retained and used by local managers to directly 
support research programs and operating needs. The primary uses of these 
funds were for research equipment, employee relocations, facilities 
repair and maintenance, safety and health improvements, and 
unanticipated operating needs.

---------------------------------------------------------------------------
    The fiscal year 1998 lapsed salaries were spent as follows:

Research Equipment:s                                               Funds
    Akron, CO.................................................   $71,200
    Albany, CA................................................   245,500
    Ames, IA..................................................   355,500
    Athens, GA................................................    88,000
    Auburn, AL................................................    52,000
    Beaumont, TX..............................................    46,400
    Beckley, WV...............................................   204,900
    Beltsville, MD............................................   991,500
    Brooksville, GA...........................................    17,600
    Byron, GA.................................................    75,000
    Columbus, OH..............................................    55,000
    Coshocton, OH.............................................    56,000
    Cheyenne, WY..............................................    12,000
    College Station, TX.......................................   174,500
    E. Lansing, MI............................................    55,900
    Fargo, ND.................................................    16,600
    Fayetteville, AR..........................................    14,000
    Frederick, MD.............................................    49,800
    Ft. Collins, CO...........................................    92,000
    Gainesville, FL...........................................    62,000
    Grand Forks, ND...........................................   288,000
    Laramie, WY...............................................    26,000
    Lincoln, NE...............................................    98,000
    Little Rock, AR...........................................    93,500
    Logan, UT.................................................    25,000
    Lubbock, TX...............................................    27,400
    Madison, WI...............................................    36,000
    Mandan, SD................................................    27,500
    Manhattan, KS.............................................   117,000
    Miami, FL.................................................    75,000
    Miss. State, MS...........................................    50,000
    New Orleans, LA...........................................    35,000
    Orlando, FL...............................................   134,000
    Oxford, AL................................................   354,500
    Peoria, IL................................................   159,000
    Phoenix, AZ...............................................    50,500
    Poplarville, MS...........................................    25,000
    Pullman, WA...............................................    83,900
    Raleigh, NC...............................................    24,000
    Stillwater, OK............................................    50,000
    Stoneville, MS............................................   295,000
    Temple, TX................................................    75,100
    Tucson, AZ................................................   140,000
    Wyndmoor, PA..............................................   172,000
    Yakima, WA................................................    48,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Research Equipment................................ 5,244,800
                    ==============================================================
                    ____________________________________________________
Facilities Repair & Maintenance/Upkeep:
    Akron, CO.................................................    20,000
    Albany, CA................................................    83,300
    Athens, GA................................................     7,500
    Beltsville, MD............................................   470,800
    Booneville, AR............................................   100,000
    Canal Point, FL...........................................   162,400
    Cheyenne, WY..............................................   101,700
    College Station, TX.......................................    31,500
    Fargo, ND.................................................    78,400
    Florence, SC..............................................    28,000
    Honolulu, HI..............................................    73,500
    Ithaca, NY................................................    17,200
    Logan, UT.................................................    65,100
    Lubbock, TX...............................................    40,000
    Mandan, ND................................................    64,100
    Manhattan, KS.............................................    58,400
    Miles City, MT............................................    35,000
    New Orleans, LA...........................................    60,000
    Orient Pt., NY............................................   200,000
    Phoenix, AZ...............................................   104,000
    Poplarville, MS...........................................    28,000
    Pullman, WA...............................................   149,000
    St. Paul, MN..............................................    31,200
    Stillwater, OK............................................    40,000
    Stoneville, MS............................................    80,000
    Tifton, GA................................................    65,000
    University Park, PA.......................................   126,500
    Washington, DC............................................    40,000
    Woodward, OK..............................................   321,500
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Facilities Repair & Maintenance/Upkeep............ 2,682,100
                    ==============================================================
                    ____________________________________________________
Operating Expenses:
    Albany, NY................................................   225,300
    Ames, IA..................................................   152,000
    Beckley, WV...............................................    46,000
    Beltsville, MD............................................    75,200
    Brookings, SD.............................................    31,000
    College Station, TX.......................................   116,000
    Columbia, MO..............................................   150,000
    Fargo, ND.................................................    50,000
    Florence, SC..............................................   115,000
    Fresno, CA................................................   100,000
    Ft. Collins, CO...........................................   211,700
    Honolulu, HI..............................................   175,000
    Ithaca, NY................................................    50,000
    Kearneysville, WV.........................................   130,000
    Madison, WI...............................................    58,600
    Peoria, IL................................................   158,000
    Raleigh, NC...............................................    50,000
    Stoneville, MS............................................   165,000
    St. Paul, MN..............................................    13,000
    Washington, DC............................................   150,000
    Weslaco, TX...............................................    24,200
    Woodward, OK..............................................    34,000
    Wyndmoor, PA..............................................    63,300
    National Agricultural Library.............................   265,500
    Headquarters.............................................. 1,082,500
                    --------------------------------------------------------------
                    ____________________________________________________

      Total Operating Expenses................................ 3,691,300
                    ==============================================================
                    ____________________________________________________
          Total Fiscal Year 1998 Use of Salary Lapse.......\1\11,618,200

\1\ This represents 60 percent of the total lapse salary accrual which 
was managed from ARS Headquarters. The 40 percent balance of the accrued 
lapsed salaries were retained and used by local managers to directly 
support research programs and operating needs. The primary uses of these 
funds were for research equipment, employee relocations, facilities 
repair and maintenance, safety and health improvements, and 
unanticipated operating needs.
---------------------------------------------------------------------------
                              aquaculture
    Question. Aquaculture continues to be one of the fastest-growing 
sectors of U.S. agriculture. What level of funding is included in the 
fiscal year 2000 request for research to support this growth industry? 
How does this compare with the fiscal year 1997, 1998, and 1999 levels?
    Answer. The funding levels are provided for the record.

Fiscal year 1997 funds..................................     $10,184,800
Fiscal year 1998 funds..................................      11,686,400
Fiscal year 1999 funds..................................      17,330,300
Fiscal year 2000 funds..................................      14,071,000

    Question. Please list those locations involved in aquaculture 
research, their specific programs and mission, and current funding and 
staffing levels. Please list future funding and staffing requirements, 
by location.
    Answer. The fiscal year 1999 aquaculture research funding, programs 
and mission, and staffing levels, by location, as well as future 
funding and staffing requirements, are as follows:

 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                        Fiscal year                     Total
                    Location                                                      Program and mission                                     Fiscal year       1999       Total funds    scientists
                                                                                                                                          1999 funds     scientists     required       required
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Auburn, AL.....................................  Diagnosis and control of diseases and parasites of cultured fish.....................      $1,913,700          7.0      $1,913,700          7.0
Pine Bluff, AR.................................  Aquaculture production and processing technology.....................................         531,400          2.0         531,400          2.0
Stuttgart, AR..................................  Research on therapeutics evaluation and culture systems for farm-raised fish.........       2,448,600          9.0       3,590,000         11.0
Albany, CA (Fairbanks, AK worksite)............  Processing technology to convert fishery byproducts into feed........................       1,086,800          1.0       1,086,800          1.0
Albany, CA (Hilo, HI) Oceanic Institute........  Tropical aquaculture feeds and culture technology development........................       1,583,800  ...........       1,583,800  ...........
Aberdeen, ID...................................  Development of alternative, grain-based diets for aquaculture species using genetic           123,500          1.0         373,500          2.0
                                                  enhancement of grains and aquaculture species.
New Orleans, LA................................  Improve flavor quality of farm-raised catfish........................................         745,900          2.4       1,005,100          3.4
Beltsville, MD.................................  Detection Methods for Cryptosporidium................................................          29,600  ...........          29,600  ...........
Beltsville, MD (NAL)...........................  Aquaculture Information Program provides the public with information on all aspects            34,000  ...........         250,000  ...........
                                                  of aquaculture.
Oxford, MS.....................................  Catfish off-flavors..................................................................         277,800          1.0         277,800          1.0
Stoneville, MS.................................  Improve production efficiency, including breeding, genetics, nutrition, health,             4,681,900          8.0       5,298,600          8.0
                                                  harvesting, and product quality of catfish.
Wyndmoor, PA (Dover, DE, Worksite).............  Food safety of farm-raised shellfish.................................................         541,900          2.0         541,900          2.0
College Station, TX............................  Food safety of catfish...............................................................         358,800  ...........         358,800  ...........
Kearneysville, WV..............................  Water Quality control and intensive culture of fish..................................       1,737,600          1.4       1,737,600          1.4
Leetown, WV....................................  Cool and cold water aquaculture research.............................................       1,235,000          4.0       4,000,000         12.0
                                                                                                                                       ---------------------------------------------------------
      Total....................................  .....................................................................................      17,330,300         38.8      22,578,600         50.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    The fiscal year 2000 budget includes a proposed increase of 
$180,000 at Stoneville, MS for research related to harmful algal 
blooms, eutrophication, and hypoxia. In addition, reductions totaling 
$3,439,300 are proposed at Auburn, AL; Stuttgart, AR; Albany, CA (Hilo, 
HI); Aberdeen, ID; Stoneville, MS; and Leetown, WV.
   lower mississippi delta nutrition intervention research initiative
    Question. Please provide the Committee with an update on the status 
of the Lower Mississippi Delta Nutrition Intervention Research 
Initiative.
    Answer. The Lower Mississippi Delta Nutrition Intervention Research 
Initiative (NIRI) is conducted by a consortium of seven partners: 
Alcorn State University, Arkansas Children's Hospital Research 
Institute, Pennington Biomedical Research Center, Southern University 
and A&M College, University of Arkansas at Pine Bluff, University of 
Southern Mississippi, ARS, and a Coordinating Center at Westat. Each 
partner participates in attaining the objectives of the Initiative by 
representation of the Steering and Research Committees. Research 
proposals and protocols are developed by the Research Committee 
utilizing expertise from each of the partners in specific Working 
Groups.
    Question. What progress has been made to date?
    Answer. The Delta NIRI Consortium has completed two major research 
projects: the Key Informant Survey (to determine the perceptions of 
community leaders in 36 counties in AR, LA, and MS relative to food, 
nutrition and health related problems and interventions) and the Foods 
of Our Delta Study (FOODS). The latter was a validation and pilot study 
conducted in three counties, one each in AR, LA, and MS. The validation 
study was to determine if the telephone methodology could be used for 
collection of food and nutrition survey data. The consortium has 
published in the Scientific literature and published a monograph, 
Nutrition and Health Status in the Lower Mississippi Delta of Arkansas, 
Louisiana, and Mississippi: A Review of Existing Data. Capacity has 
been built in each partner through the employment of additional 
scientists and workshops on statistical sampling, nutritional 
epidemiology, intervention strategies, and evaluation of nutritional 
status.
    Question. What activities are planned for each of fiscal years 1999 
and 2000?
    Answer. In fiscal year 1999, the partners propose: the first phase 
of a comprehensive nutritional assessment survey (collection of 
dietary, food security, and health perceptions data) will be completed 
in the thirty-six counties in AR, LA, and MS delta area; planning for 
the second phase of the survey which will include biochemical, 
anthropometric, and dietary data, and partner institutions will 
complete and begin to implement their strategic plans for continuing 
the research activities of the Initiative. Extensive field surveys will 
be based on the results of preliminary assessments in 1998. The 
partnership will focus on data collection and analysis. Extensive 
collaborative field work will be required. Post fiscal year 1999, 
research will depend on prior outcomes but will include initial 
planning, implementation, and validation of targeted nutritional 
interventions. In fiscal year 2000 the data collection of the above 
studies will be completed and data analyses will be completed. 
Protocols for the assessment of community food security will be 
piloted; protocols for nutrition interventions will be finalized; 
additional research will be planned based on results of data analyses, 
especially in the area of food security. Individual partners will 
assume responsibility for specific research proposals of the initiative 
(for example: through the development of telephone survey centers, 
dietary data analyses, overall data analysis, and community outreach).
    Question. What is the current level of funding for this initiative 
and what is the fiscal year 2000 request?
    Answer. A total of $3,147,700 is the current level of funding for 
the Lower Mississippi Delta Nutrition Intervention Project. A total of 
$3,147,700 is budgeted for fiscal year 2000.
    Question. Will fiscal year 2000 funding continue to be split 
equally among the seven partners of the consortium conducting this 
initiative?
    Answer. The funding of $3,147,700 for fiscal year 2000 will 
continue to be shared equally among the seven partners.
                            ginning research
    Question. Please provide the level of resources available in each 
of fiscal years 1998 and 1999, and included in the fiscal year 2000 
request for the ginning labs at Mesilla Park, NM; Stoneville, MS; and 
Lubbock, TX.
    Answer. Resources for each of fiscal years 1998, 1999, and 2000 for 
ginning research is provided for the record.
    [The information follows:]

 
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                            Location                              1998 Estimated  1999 Estimated  2000 Estimated
----------------------------------------------------------------------------------------------------------------
Stoneville, MS..................................................      $1,190,900      $1,423,400      $1,423,400
Las Cruces, NM..................................................       1,062,800       1,049,900       1,049,900
Lubbock, TX.....................................................       1,262,000       1,246,700         752,700
                                                                 -----------------------------------------------
      Total.....................................................       3,515,700       3,720,000       3,226,000
----------------------------------------------------------------------------------------------------------------

    Question. Please describe the importance of the work being carried 
out by ARS at each of these locations and whether there are presently 
any unfunded facility or program requirements.
    Answer. Cotton ginning remains an important area for improving the 
efficiency and profitability of the industry. The process of separating 
fiber from seed, removing trash, and drying often degrades the quality 
of the lint, making it less valuable and reducing the return to 
producers. With cotton prices very low, the cotton industry has called 
for research to improve profitability by 10 cents per pound of lint 
produced. Much of this shortfall can be captured by improved ginning 
efficiency, which both decreases costs and improves the quality and the 
price of the product.
    Some recent important advances from these ARS laboratories include 
computerized process control for improved lint quality and better 
profitability; technology for reduced dust emissions from gins to 
improve air quality; online moisture sensors and control systems for 
improved drying efficiency, energy conservation, and decreased lint 
damage; seed coatings that reduce the need for delinting with dangerous 
acids; technology that reduces seed coat fragmentation and nep (fiber 
entanglements) formation during ginning; and combined drying and 
ginning operations to improve efficiency.
    Equipment at all three laboratories is aging and some of it is 
outdated, with an estimated cost of up to $500,000 per laboratory for 
upgrading. Facility repair and upgrading is required to support ongoing 
research as well as to allow transition to new program initiatives. New 
program needs not currently being addressed include improved harvesting 
and processing equipment for ultra narrow- row production; technology 
to reduce use of defoliants and other harvest aid chemicals; value-
added products from gin waste; and integration of gin management with 
production management and with the changing needs of the textile 
industry. At Lubbock, ARS has a good cooperative relationship with 
Texas Tech University and is in a position to develop the linkage to 
textile manufacturing, in part through collaboration with the 
University's International Textile Center, and with collaborative 
contributions from the other ginning laboratories and ARS laboratories 
in New Orleans and Clemson, and in partnership with State institutions.
    Question. What are the unique capabilities of each of these labs 
and how does ARS ensure there is no duplication of effort among them?
    Answer. The ginning laboratories are a unique resource in the 
United States, with no other facilities serving a similar purpose. The 
three laboratories have complementary roles. They are located in 
different cotton-producing regions of the U.S., each with greatly 
different cotton production systems and therefore with differing cotton 
processing and ginning needs. In part, the mission of each laboratory 
is to address problems of cotton harvesting, processing, and ginning 
that are specific to its region. These functions are, by their very 
nature, not duplicative. In Stoneville, ginning research addresses the 
needs of upland cotton producers in a humid production zone. In 
Lubbock, the research is focused on harvesting and ginning needs of 
short-season stripper-harvested cotton. The laboratory in Mesilla Park 
concentrates on high-quality long and extra-long staple cottons 
produced in the Irrigated West, which require different equipment and 
methods to preserve the inherent quality.
    ARS provides national oversight and management of research through 
its National Program Staff, which determines priorities through 
interactions with customers and stakeholders; allocates funding to 
different research objectives consistent with the intent of the 
Congress and the needs of ARS customers; and coordinates activities 
among laboratories. Much of this management occurs through 23 recently 
established National Programs. The three ginning laboratories all 
participate in the same National Program (New Uses, Quality, and 
Marketability of Plant Products), which provides a venue for the 
scientific staff to plan, carry out, and report cooperative, 
coordinated, research. Because of this coordination, the existence of 
three different labs with complementary activities actually strengthens 
cotton ginning research, because it serves customers in all regions 
without wasteful duplication and without gaps.
    Question. The National Cotton Council has asked the Committee to 
instruct the ARS not to reprogram fiscal year 1998 funds provided to 
the Lubbock lab. Is the Administration contemplating such a 
reprogramming request? Are there any unused fiscal year 1998 funds 
available?
    Answer. The fiscal year 2000 budget request includes the reduction 
of $494,000 appropriated for the Lubbock ginning laboratory. The funds, 
which were first added by Congress in 1998, are proposed to be 
redirected into areas of highest national priority, such as food 
safety, emerging and exotic diseases and pests, agricultural plant 
genomes, impact of FQPA implementation, and sustainable ecosystems. A 
total of $35 million in proposed reductions and terminations are being 
used to finance these proposed, high priority increase. Prior to the 
proposed redirection, the funds were used to hire two engineers who 
have already joined the staff of the laboratory in Lubbock. There are 
no unused fiscal year 1998 funds available, but ARS is committed to 
providing alternative employment opportunities to its scientific staff 
displaced by redirection of funds.
                               aflatoxin
    Question. The Committee is aware of extensive problems which 
occurred during 1998 in southern corn production. In particular, 
aflatoxin in corn has adversely impacted the prices received by farmers 
and the markets for southern corn production. What steps are being 
taken to enhance and expand research to address this problem? Is there 
adequate focus being placed on this problem, especially in view of the 
fact that current farm policy has resulted in the rapid growth of 
southern corn production?
    Answer. The ARS has taken steps to enhance and expand research to 
address the aflatoxin problem in southern corn. The Southern Regional 
Research Center (SRRC) of the ARS sponsored an ``ARS Workshop on 
Aflatoxin Prevention in Southern Corn'', January 27, 1999 in New 
Orleans, LA. There were 67 attendees comprising ARS and university 
aflatoxin researchers, corn growers and corn industry representatives 
with an intense interest in research aimed at eliminating aflatoxin. 
The workshop provided a forum by which corn industry representatives 
could discuss the conditions under which contamination occurred in 
1998, and the state-of-the-art technology being developed by 
researchers to control aflatoxin contamination.
    The workshop developed a plan to further focus and enhance 
resources aimed at the elimination of aflatoxin in corn before harvest 
using the extensive input from researchers and workshop participants. 
The goals of the plan are to:
    Identify additional sources of resistant corn germplasm. Use marker 
assisted breeding to combine resistance traits for prevention of fungal 
infection, aflatoxin contamination, and insect injury in corn;
    Elucidate the effects of drought on biochemistry, physiology, 
aflatoxin accumulation and fungal pathology in kernels of resistant 
corn genotypes;
    Transform corn with ``up-regulated' versions of disease and/or 
drought resistant genes;
    Continue investigation on cultural practices and crop management 
techniques that may minimize aflatoxin contamination before harvest; 
and
    Develop a toxigenic A. flavus technology for aflatoxin control on 
corn grown in the southern U.S. (Research experience has demonstrated 
that this technology is effective in preventing aflatoxin in cotton 
grown in Arizona.)
    ARS has extensive resources devoted to solving the southern corn 
aflatoxin problem at several locations throughout the southern U.S., 
including Mississippi State, MS; New Orleans, LA; and Tifton, GA. 
Because of their research we have made significant advances in 
understanding how aflatoxin is produced and potential effective 
strategies for reduction. These research advances are as follows:
    Delineated the effects of cultural practices and pest management on 
the accumulation of aflatoxins in corn.--ARS research has elucidated 
both the ``life cycle'' of A. flavus, the preharvest process by which 
aflatoxin contamination occurs, and the effects of cultural conditions 
and insects pests on aflatoxin contamination. Several factors can be 
manipulated which can affect the level of aflatoxin contamination--the 
corn hybrid utilized and its adaptability to the geographic region, 
choice of fields, soil fertility, planting and harvest dates, planting 
density, irrigation, harvest methodology, tillage and crop rotation and 
management of insect pests (for example, with the advent of new Bt 
transformed lines of corn resistant to insects). Generally, 
optimization of cultural and management practices in the particular 
growing region to produce healthy corn partially alleviates (or at 
least does not exacerbate) aflatoxin contamination.
    Genetic and Biochemical Resistance Factors Identified in Corn.--ARS 
research has produced four germplasm releases (one release occurring in 
1999) with useful levels of aflatoxin resistance, thus showing 
substantial progress in developing a genetic based resistance. Markers 
which could be useful in marker assisted breeding and/or genetic 
engineering of corn have been putatively identified in corn. Selection 
for these genetic and biochemical factors/traits could further help 
increase resistance in certain corn varieties to A. flavus, aflatoxin 
and insect attack (which can predispose corn to fungal infection).
    Several putative resistance factors were characterized at the 
protein level and shown to comprise fungitoxic proteins, enzymes, 
enzyme inhibitors and peptides. Also identified were kernel pericarp 
properties (wax thickness and antifungal properties) in a resistant 
corn genotype that may either prevent the physical entry of A. flavus 
into kernel tissues or kill the fungus directly. Corn genotypes will be 
selected to maintain production of these resistance compounds even 
under suboptimal conditions for kernel health and development (such as 
drought stress or insect injury).
    Identification and Successful Deployment of a Biocontrol Agent in 
Large Scale Cotton Field Trials.--A biological control formulation was 
invented by ARS scientists for use in aflatoxin prevention in 
cottonseed grown in the Yuma Valley, Arizona. The formulation is made 
from non-toxic strains of A. flavus previously discovered in Arizona 
cotton fields. When applied to cotton fields in large scale trials, the 
formulation reduced aflatoxin below the FDA mandated level of 20 ppb in 
cottonseed. In parallel work by ARS scientists, non-toxic strains of A. 
flavus/parasiticus were used in biocontrol of aflatoxin in peanut. This 
technology may also be effective for large area control of aflatoxin in 
corn grown in the southern US, however EPA approval is needed for each 
individual type of application.
    Genetic Engineering of Plants with Resistance Genes Encoding 
Proteins Inhibitory to A. flavus.--Using genetic engineering resistance 
genes from corn and other sources, encoding antifungal proteins 
(effective against A. flavus) have been moved into tobacco plants and 
cotton callus where they showed high in vitro expression of antifungal 
activities. With the development of new efficient corn transformation 
protocols and identification of potent antifungal genes, the potential 
for genetically engineering corn for resistance to A. flavus becomes 
very feasible.
    Molecular Basis for Aflatoxin Biosynthesis Elucidated.--A cluster 
of genes was found which encodes enzymes catalyzing aflatoxin formation 
in Aspergillus flavus and A. parasiticus. Previously, a ``master 
switch'' gene was discovered which could be targeted essentially to 
switch off aflatoxin production. Reporter genes consisting of portions 
of aflatoxin gene regulatory DNA or growth related genes linked to the 
GUS reporter gene were engineered into A. flavus. These reporter genes 
could help identify plant factors affecting levels of aflatoxin, which 
in turn could be used as selectable markers in breeding for resistance.
    Question. The Department recently announced that ARS researchers 
have created a new corn line which is highly resistant to aflatoxin and 
could be an important step toward the long-term goal of commercial 
hybrids with strong aflatoxin resistance. Would you please tell us more 
about this major research advancement.
    Answer. Agricultural Research Service (ARS) scientists at 
Mississippi State, Mississippi, have recently developed and released 
corn germplasm which is highly resistant to Aspergillus flavus, the 
fungus that infects grain and produces the toxic substance, aflatoxin.
    Because corn hybrid seeds are all developed and marketed by the 
private sector, incorporating the A. flavus resistance into 
commercially available hybrids requires that ARS transfer the 
technology to hybrid seed corn companies. To do so, Cooperative 
Research and Development Agreements (CRADAs) have been established with 
two such companies.
    Question. What is the current level of funding and staffing levels 
for aflatoxin research and at which ARS locations is this work 
conducted?
    Answer. The current level of funding and staffing levels for 
aflatoxin research, including ARS locations at which this work is 
conducted are as follows:

                           [Fiscal Year 1999]
------------------------------------------------------------------------
                Location                       Funds        Scientists
------------------------------------------------------------------------
Albany, CA..............................      $1,788,900             6.7
Dawson, GA..............................         745,600             2.9
Tifton, GA..............................         544,200             1.5
Peoria, IL..............................         827,300             2.9
New Orleans, LA.........................       2,832,700            10.9
Miss. State, MS.........................         669,100             2.8
Headquarters............................         861,200             0.0
                                         -------------------------------
      Total.............................       8,269,000            27.7
------------------------------------------------------------------------

    Question. What additional funds are required for aflatoxin research 
to expand projects implementing the biocontrol management technology 
and increasing funds for grants to translate our best knowledge into 
practical systems to help farmers?
    Answer. The fiscal year 2000 budget does not request additional 
funds for aflatoxin research. ARS continues to meet with stakeholders 
and customers to ascertain their important research needs, including 
implementing biocontrol management technology and increasing the 
translation of our best research knowledge into practical systems to 
help farmers. The additional priorities for aflatoxin research will be 
met by redirection, or by future agency budget requests.
                            cotton nematode
    Question. The Committee is concerned that cotton yields have been 
stagnant and even declined in some cases over the past decade in the 
Midsouth area. Among other problems affecting this situation, I 
understand that scientists at the Midsouth Research Center have 
detected a contributing factor to be the growing problem of cotton 
nematodes. In view of the rising cost of production for cotton farmers 
and the statistical plateau in Midsouth cotton yields, what is USDA 
doing to aggressively seek solutions to problems such as the cotton 
nematode. Are research needs being met to provide an adequate level of 
scientific support for solving cotton nematode problems?
    Answer. The origins of the cotton ``yield plateau'' are complex, 
with a major source being the narrow genetic base of commercial cotton 
varieties. In the Mississippi Delta region and in some other areas, 
there is also a growing problem with nematodes. These pests are forcing 
many growers to look for the first time to rotation crops that are non-
hosts for nematodes. Corn and rice have proved to be good rotation 
crops for soybeans and cotton in the Mississippi Delta.
    ARS maintains a strong national research program that is focused on 
controlling or managing nematodes with environmentally friendly 
methods. In Beltsville, MD, ARS studies the fundamental biology of 
these pests and uses that information to develop new avenues to disrupt 
their life cycles and protect crops. Elsewhere, ARS research is 
targeted specifically at nematodes that affect specific crops. Cotton 
nematode work is carried out at College Station, TX (improved 
management, biological control, and host plant resistance); Stoneville, 
MS (cotton production systems that minimize pest damage from 
nematodes); and Mississippi State, MS (identification of new genes for 
nematode resistance, and using them to breed resistant cotton 
germplasm). ARS research has resulted in the development and release of 
nematode-resistant germplasm for use in breeding programs, including a 
variety which has been widely used in the Lower Rio Grande Valley of 
Texas.
    The current ARS program has effectively targeted the most feasible 
ways to bring cotton nematodes under control. Promising approaches 
include genetic host plant resistance and biological control using 
fungi. Additional funding would allow a broader approach to nematodes 
and could intensify the ARS effort in selected areas where the pest 
pressure is increasing, such as the Mississippi Delta.

                    BASE FUNDING FOR COTTON NEMATODES
------------------------------------------------------------------------
                                            Fiscal year     Fiscal year
                                               1998            1999
------------------------------------------------------------------------
College Station.........................        $370,700        $370,700
Stoneville..............................          45,100          45,100
Mississippi State.......................         610,100         610,100
                                         -------------------------------
      Total.............................       1,025,900       1,025,900
------------------------------------------------------------------------

                         red imported fire ant
    Question. Where is the site of ancestral origin for the red 
imported fire ant, and how did it enter the United States?
    Answer. Red imported fire ants originated from the Paraguay river 
drainage basin in Argentina, Paraguay and Brazil. The mode of entry 
into Mobile, Alabama, in the mid 1930s is unknown but probably was the 
result of contaminated ship ballast or agricultural products associated 
with soil arriving from Argentina or Brazil.
    Question. What is the present and projected geographic range of the 
red imported fire ant in the United States?
    Answer. Presently, this pest is distributed in about 310 million 
acres in Virginia, North Carolina, South Carolina, Georgia, Florida, 
Alabama, Tennessee, Mississippi, Louisiana, Arkansas, Texas, Oklahoma 
and Puerto Rico. Recently it has been detected in limited areas of New 
Mexico, Arizona, California, but appears to be established in all but 
Arizona. Projected distributions, based on temperature limits, would 
allow expansion into the tidewater area of Virginia, the eastern shore 
of Maryland, and most or all of Oklahoma, Arkansas, Tennessee and North 
Carolina. Conditions also are favorable in the irrigated urban and 
agricultural regions of the western states including most of California 
(80 percent), and sections of Arizona (70 percent), Nevada (10 percent) 
and New Mexico (30 percent). Coastal regions in particular are 
vulnerable throughout California, in Oregon, and possibly Washington.
    Question. What is unique about the red imported fire ant that 
allows it to be an urban, agricultural, wildlife, and industrial pest?
    Answer. The red imported fire ant is virtually ubiquitous in the 
southeast and is characterized typically by 75-100 colonies (mounds) 
per acre with each colony containing half a million stinging ants. 
Thus, there can be 40-50 million imported fire ants per acre. The 
imported fire ants out-compete and replace native ants (including 
native fire ants) which reach about 1000 in number per colony and 1-2 
million per acre. Fire ants are far more aggressive than the native 
ants and readily sting animals and humans when disturbed. Unlike native 
ants which move away from the disturbed areas, the red imported fire 
ants explore and thrive in disturbed habitats caused by human 
activities that include agricultural operations, urbanization, 
transportation infrastructures (roads, sidewalks, airports) and 
utilities. They produce hundreds of thousands of winged queens per acre 
that may disperse several miles and establish new colonies that mature 
within months, and release additional winged queens. In comparison, 
native ants produce up to 1,000 queens and do not spread as well. The 
red imported fire ant is inadvertently moved in agricultural and 
horticultural products in soils, and easily becomes established at 
final destinations.
    Question. What is the economic impact of the red imported fire ant 
to the nation?
    Answer. Nationally, imported fire ants are estimated to cause 0.5 
billion to several billion dollars in damage every year. Exact figures 
are difficult to determine because economic impact is so diverse and 
widespread. Losses are incurred in agriculture, human health, damage to 
infrastructure, damage to wildlife and farm animals, and in the costs 
to manage this pest. This excludes the pain and aggravation associated 
with fire ant stings, or the environmental damages to biodiversity and 
the ecosystem. Fire ants kill newly hatched offsprings and reduce the 
populations of several wildlife species, including bob white quail, 
other ground-nesting birds, and others with few defenses, such as 
tortoises, tree snails, marsh hares, amphibians, and reptiles.
    Question. What is the economic impact of the red imported fire ant 
to Mississippi?
    Answer. The economic impact of the red imported fire ants to 
Mississippi is, according to the Mississippi Department of Agriculture, 
somewhere between 75 million and 200 million dollars per year.
    Question. Describe the damage caused by the red imported fire ant 
in urban areas by stinging; in agricultural areas where livestock are 
attacked, plants damaged, and crop care and harvest interfered with; in 
wildlife areas where other invertebrates and ants are displaced and 
recreational activities interfered with; and in industrial areas where 
the ant causes malfunctions by tunneling and nesting near electrical 
conduits and communication systems.
    Answer. The red imported fire ants are a major medical concern to 
approximately 0.5 million people who are severely allergic to even a 
single fire ant sting (1 percent of the population), and to millions of 
young children who are repeatedly stung by hundreds of fire ants when 
they accidentally step onto the mounds. People who are allergic or very 
sensitive to fire ant stings often need to limit outdoor activities 
because fire ants are found virtually everywhere except in dense 
forests.
    Fire ants cause a wide variety of agricultural problems. They lower 
soybean harvests by 10-30 percent by killing seedlings, and from the 
need to raise the Combine cutting bar to avoid mounds. They frequently 
girdle and kill young citrus trees. They attack and kill corn and 
sorghum seedlings. They can damage a wide variety of vegetables from 
okra and potatoes to watermelon and strawberries. They inhibit 
harvesting of many nuts, fruits, and vegetables that are picked by 
hand, or when the crop is shaken to the ground for subsequent 
collection. Their mounds mechanically jam or damage harvesting 
equipment. Fire ants also injure or kill young livestock and poultry. 
Foraging activity of fire ants commonly short circuits outdoor 
electrical equipment such as air conditioners, power transformers, and 
telephone boxes. Their tunneling and mounding activities loosen or 
removes soil from beneath roadways, causing these to collapse under 
weight of vehicles.
    Fire ants are also a major environmental concern because they 
substantially reduce the biodiversity of native ants and other ground-
dwelling arthropods. They also reduce populations of many native 
vertebrates such as quail, lizards, water birds, mice, and even deer. A 
number of rare and endangered animals such as gopher tortoises, sea 
turtles, alligators, butterflies, tree snails, grasshopper sparrows, 
and the least tern may also be negatively affected by fire ants.
    Question. Why have U.S. federal, state, and private sector 
researchers failed in their efforts to develop technologies for 
stopping the spread of the red imported fire ant?
    Answer. ARS was instrumental in the development of a chemical, 
mirex which provided 99 percent control level. In the early 1960s, 
large-area eradication tests with toxic baits (mirex) were conducted in 
several states, including northeastern Mississippi (256,000 acres), 
Tampa, Florida (626,000 acres), and Savannah, Georgia (2.13 million 
acres). Although mirex was very effective in controlling fire ants (99 
percent control), it subsequently was removed from the market, because 
of the environmental and economic concerns. Consequently, in the late 
1960s these field tests with mirex were terminated. Alternative 
materials that replaced mirex were less environmentally damaging, but 
not as effective in area-wide control, and provided only temporary 
relief.
    To develop new and improved fire ant control technologies, the ARS 
laboratory in Gainesville, Florida focused on developing poison baits 
for controlling fire ants in small but high public-usage and livestock 
production areas, such as yards, parks, schools, hospitals, and 
feedlots. These newer bait materials, such as AMDRO and LOGIC are very 
effective, but give only temporary control in such areas that 
ultimately become reinfected. Consequently, since 1995, ARS has focused 
its research on the development and evaluation of an integrated long-
term methods, including the release of classical biocontrol agents that 
have the potential of permanently reducing fire ant populations over 
large portions of their range. The goal is to help slow or stop the 
expansion of imported fire ants into uninfested areas. Small-scale 
field test releases have been initiated in 1998 in one-quarter acre 
plots in several states. Given the necessary resources, ARS plans to 
conduct research on mass propagation of selected biocontrol agents, and 
conduct large-area field evaluation and demonstration tests.
    Currently, additional technologies may be needed to halt the 
expansion of fire ant populations. The biology of this pest is such 
that natural spread is difficult to prevent without a concerted, 
coordinated large-scale application of multiple control measures. 
Because it is so widespread environmentally (not limited to specific 
crops or plant types), and exists underground (largely unexposed), it 
is neither environmentally nor economically feasible to use toxic 
pesticides.
    Question. What plans does ARS have for research to: (1) stop the 
spread of the red imported fire ant; (2) suppress it in infested areas; 
and (3) eradicate the fire ant at the local level, statewide (including 
in Mississippi), and nationwide?
    Answer. The ARS laboratory in Gainesville, Florida has ongoing 
cooperative projects with states to evaluate its biologically-based 
approach, including: (1) cooperative projects between ARS and APHIS to 
stop the spread of fire ants through nursery stock. A new attractant 
has been developed and patented to assist in rapid assessment of 
infested material while still in nursery facilities; (2) current ARS 
research on suppression in infested areas is focused on the development 
and field evaluation of an integrated long-term approach. This approach 
relies on the use of biologically-based technologies to reduce overall 
population levels, combined with blanket applications of emerging bait 
formulations that are followed by precision-targeted treatments of high 
risk local areas (schools, health care facilities, parks, tourism, and 
recreation) with emerging bait technologies; and (3) two of the three 
biological control agents developed by the ARS laboratory in 
Gainesville, Florida are being evaluated in several pilot tests. In 
this effort, ARS is partnering with the National Fire Ant Task Force of 
the Southern Legislative Conference (SLC) of the Council of State 
Governments to develop proposals for pilot tests in several states. For 
example, ARS is proactively involved in developing a cooperative 
research project with the Mississippi State University and APHIS 
(Gulfport) to test integrated control measures for a 300-acre health 
care facility in Mississippi. In addition, ARS is conducting 
cooperative projects with APHIS at field sites near Gulfport, and with 
the Mississippi National Guard/Nature Conservancy on managing fire ants 
at Camp Shelby. That effort is specifically addressing the issue of 
fire ant impact on gopher tortoises. Other pilot test sites in 
partnership with SLC include, Arkansas, Oklahoma, Texas, Virginia and 
Tennessee have been selected. However, current constraints in state and 
federal resources preclude large-scale field evaluation and 
implementation of the integrated approach.
    Question. Which ARS locations have been directed to conduct 
research on the red imported fire ant and in each case what is the 
level of effort in terms of dollars and scientists? Is there any 
research on the fire ant being conducted in Mississippi?
    Answer. ARS research on imported fire ants is conducted at the 
Center for Medical, Agricultural, and Veterinary Entomology in 
Gainesville, Florida ($1,311,800/5.9 SYs), with cooperative projects at 
the South America Biocontrol Laboratory at Hurlingham, Argentina 
($101,400/.2 SYs). ARS research in Mississippi consists of cooperative 
projects with APHIS at field sites near Gulfport, and in a cooperative 
project with the Mississippi National Guard/Nature Conservancy on 
managing fire ants at Camp Shelby. That effort is specifically 
addressing the issue of fire ant impact on gopher tortoises.
    Question. What is the level of Federal funding currently obligated 
by ARS, CSREES, and APHIS for research, education, and regulatory 
activities? How much funding is contributed by State and private 
organizations?
    Answer. The level of Federal funding currently obligated for 
research, education, and regulatory activities for red imported fire 
ants is $1,413,200 for ARS; $76,300 for CSREES; and $1,330,000 for 
APHIS. Funding contributed by State and private organizations includes 
non-federal funds of $742,000 for CSREES and $1,139,959 for APHIS. ARS 
receives no funding from State and private organizations for red 
imported fire ant research.
                 national plant germplasm system (npgs)
    Question. Are there materials in the National Plant Germplasm 
System (NPGS) that are at risk for loss and that will remain at risk 
under the Administration's budget request?
    Answer. Duplicate germplasm samples and duplicate copies of 
databases maintained in at least two physically-separate locations 
represent perhaps the most effective safeguards against the risk of 
catastrophic loss from weather- related causes, other natural 
phenomena, equipment failure, and human activity, be it intentional or 
unintentional.
    The Germplasm Resources Information Network (GRIN) in Beltsville, 
MD, which maintains key data associated with NPGS germplasm, is 
duplicated by mirroring, i.e., there are two copies of the database on 
disk. One weekly duplicate copy of the database is maintained off-site 
locally on tape and one duplicate is sent monthly to National Seed 
Storage Laboratory, (NSSL) Ft. Collins, CO. The Administration's budget 
requests an increase of $600,000 for additional data safeguards, such 
as incorporating into GRIN evaluation and characterization data that 
are still on local databases, and continual hardware and software 
upgrades to help safeguard database integrity.
    At present, ca. 104,000 (ca. 26 percent of total) seed samples and 
32,000 (ca. 85 percent of total) clonally-propagated samples in the 
NPGS are not duplicated, and consequently are at a higher risk of 
catastrophic loss than are the duplicated samples. Some of the samples 
that are not duplicated within the NPGS are duplicated in other nations 
or at International Agricultural Research Centers (IARCs). But, with 
fiscal shortfalls at other institutions, the NPGS cannot assume that 
duplicates of ``lost'' germplasm can be readily obtained elsewhere. As 
the preceding data indicate, the risk is greatest for clonally-
propagated germplasm. With many clonal crops, long-term ``backup'' 
methods (e.g., cryopreservation) do not exist; more funds are needed 
for NPGS researchers to develop this technology.
    Germplasm may also be at risk from slower, more insidious processes 
such as gradual loss of viability, loss of genetic integrity, 
infectious disease, etc., that deteriorate the quality of germplasm and 
associated data. The following list illustrates some NPGS germplasm 
potentially at risk:
    (1) Griffin, GA: At least 20 percent (17,000 + accessions) of the 
seed samples at Griffin are greater than 20 years old, or are original 
seed lots with few seeds. With the few funds available for operations 
(ca. 6 percent of total fiscal year 1999 location budget), relatively 
few accessions can be regenerated at present.
    (2) Ithaca, NY (Geneva, NY worksite): About 30 percent (ca. 4,000 
accessions) of the seed-propagated germplasm accessions are at risk 
because of low or unknown viability, or low seed numbers. With the few 
funds available for operations (ca. 10 percent of total fiscal year 
1999 location budget), relatively few accessions can be regenerated at 
present.
    (3) Mayaguez, PR: Without additional funds for clonal propagation 
and virus eradication, 30 percent of the plantain and banana clones at 
this site may die of virus infection.
    (4) Ft. Collins, CO: More than 20 percent of the duplicate seed 
accessions in long-term storage at NSSL have not been tested recently 
for their viability, and consequently may be at risk. No funds are 
available to hire more technical staff to conduct germination tests.
    (5) College Station, TX (Brownwood, TX worksite): Approximately 60 
percent of the pecan accessions there are represented by only one tree, 
and none of the accessions are backed-up at another site. No funds are 
currently available to improve this situation.
    (6) Ames, IA: Approximately 4,500 seed-propagated accessions with 
low seed number, and low germination percentages (9.5 percent of the 
total) are at risk because there are no funds to regenerate them. Funds 
are also unavailable to conduct applied research to regenerate and 
monitor seeds of species for which standard management protocols have 
never been developed.
    (7) Corvallis, OR: Under the Administration's fiscal year 2000 
budget request, $27,400 of the base funding for the Corvallis genebank 
will be eliminated. Those funds support the hop (a key ingredient for 
brewing) germplasm maintenance, regeneration, and viral eradication 
program. If the preceding funds are not reinstated, this site will be 
unable to maintain and distribute the collection in pathogen-negative 
(virus, fungus, and bacteria-free) status.
    Question. With current resources, is the agency able to manage the 
materials that are in the quarantine centers in a manner that 
successfully fulfills the demands of the users? Have materials died in 
quarantine centers? Are the materials made available to the requesters 
in a timely manner?
    Answer. In general, the Plant Germplasm Quarantine Office/National 
Plant Germplasm Quarantine Center (PGQO) in Beltsville, MD can manage 
the plant germplasm in quarantine successfully, provided the amount of 
germplasm in the PGQO does not exceed current capacity, which is 
determined primarily by the funding available for personnel, 
operations, and facilities. To ensure that its capacity is not exceeded 
by demand, the PGQO is establishing annual quotas for each type of 
germplasm. These will be communicated to germplasm users in May 1999 
and put into effect for fiscal year 2000. The quotas will vary somewhat 
over years based on factors such as the germplasm in the quarantine 
testing ``pipeline'' at the beginning of the year, changes in testing 
protocols, and changes in program goals.
    No significant germplasm losses have occurred in the potato, sweet 
potato, rice, or sugarcane held by the PGQO. In the past, fruit tree 
accessions in the PGQO orchards were lost because of inadequate care, 
and insufficient attention to matching the work load with the resources 
available to tend to this germplasm. These problems were addressed and 
loss has been minimal during the last three years of orchard testing. 
Some replicates of accessions have been lost to herbicide injury but, 
in these cases, a sufficient amount of backup material was available to 
repeat the tests as necessary. Occasionally, replicate samples of 
blackberry, raspberry, or currant perish from winter damage in the 
screenhouses. But, these samples are ``backed up'' so the accession is 
not lost, but its release from quarantine is delayed because the tests 
must be repeated. Losses from winter kill have been minor during the 
past two years because of mild weather, and improved horticultural 
care.
    The stone fruit (cherry, peach) quarantine program is conducted 
entirely in greenhouses and screenhouses, where germplasm loss is 
relatively rare, but does occur occasionally because of several factors 
that are not unique to PGQO: (1) the inherent difficulty of maintaining 
trees in pots for years; (2) cherry and peach accessions received by 
PGQO as budwood are often difficult to propagate, especially after days 
in international transit, and may die before they are established.
    Germplasm is made available (``released'') from quarantine as 
rapidly as quarantine regulations and/or ``pathogen clean up'' permit. 
The only crop with a backlog of accessions awaiting quarantine testing 
is rice, with a 4,000 accession backlog:
    (1) Pome fruits (apples, pears, quince) are now released 
``provisionally'' within one year if the first round of testing is 
negative and if the propagative material is available. Under the 
``provisional release policy,'' germplasm users can propagate and 
evaluate the germplasm prior to its final release from quarantine. This 
policy has been very popular with germplasm users, and is feasible 
because of the polymerase chain reaction (PCR) test for phytoplasmas. 
Final release still requires at least 3-5 years because test trees must 
produce fruit for evaluation of symptoms: there is no technological 
substitute for the fruit evaluation.
    (2) Stone fruits (cherry, peach) are also provisionally released 
after one year, but full release requires at least 3-5 years for 
germplasm imported as budwood. But germplasm imported as seed can be 
released sooner (12-18 months) because less testing is required.
    (3) Sugarcane imported from other nations requires 18-24 months in 
quarantine, whereas sugarcane shipped interstate (e.g. Louisiana to 
Florida) requires 12-18 months. Current molecular technology will 
probably not accelerate the release time, although the former may 
improve the accuracy of test results.
    (4) Rice cannot be released from quarantine until it sets seed, 
which can require 100 to 240 days, depending on the specific germplasm. 
Notably, quarantine testing could be conducted entirely from in vitro 
tissue culture and germplasm released in 30 days but, because it would 
be distributed in the form of tissue-cultured plantlets, rather than 
true seed, the user community has not been interested in this method.
    (5) The quarantine process for potatoes and sweet potatoes requires 
18-24 months; tests require one year and are repeated. The testing 
required for true potato seed is substantially less than for potato 
tubers.
    (6) The quarantine process for currants and gooseberries requires 
3-5 years, necessitated by waiting for plants to fruit so they can be 
evaluated for the reversion virus. There is a PCR-based test for the 
reversion virus but APHIS has not accepted it, although Agriculture 
Canada has done so. The PCR test could enable provisional release after 
one year, if the propagative material is available.
    (7) The quarantine process for raspberries requires about 3 years.
    Question. With current resources, are you able to take advantage of 
modern molecular techniques to accelerate the rate of quarantine 
testing for crops such as rice, apples, cherries, sweet potatoes, and 
others?
    Answer. Molecular diagnostic techniques alone may not accelerate 
the finalrelease of germplasm from quarantine but they may accelerate 
the provisional release of germplasm, as described above for pome and 
stone fruits. The tests will detect target pathogens that have been 
thoroughly characterized genetically, but not other ``exotic'' 
pathogens which are often essentially unknown scientifically, except 
for symptoms on the plant or fruit. Thus, molecular diagnostic tests 
will not completely replace the time-consuming visual observations of 
plants currently required by APHIS regulations. Consequently, the speed 
of the entire quarantine process may be more closely related to 
principles of scientific risk assessment and/or the field and 
greenhouse capacity, rather than to modern molecular technology.
    Despite the preceding factors, the current resources at the Plant 
Germplasm Quarantine Office (PGQO) do not enable the staff to take full 
advantage of molecular diagnostic techniques. Additional resources in 
the form of a senior technical assistant and additional supplies could 
hasten the implementation of molecular technology which would 
facilitate provisional germplasm releases. Additional resources are 
needed to hire additional technical staff to fully utilize the new 
greenhouse and screenhouse space at the PGQO, and accelerate the rate 
whereby germplasm can be released from quarantine.
    (1) Pome (apple, pear) and stone fruits (cherry, plum, peach): The 
PCR-based test for phytoplasmas and molecular hybridization assays for 
viroids have enabled provisional quarantine release within one year, 
providing adequate budwood is available. Half-time technical assistance 
is needed to fully utilize new greenhouse and screenhouse space, 
implement more fully this molecular testing program, and further 
accelerate the quarantine process.
    (2) Stone fruits: Implementation of a PCR-based test for sharka 
(plum pox) could supplement to plant graft testing on indicator 
species, but would require an additional resources for implementation, 
and half-time technical assistance to fully utilize new greenhouse and 
screenhouse space.
    (3) Sugarcane: Current quarantine testing relies on observations of 
symptoms on greenhouse-grown plants, which is not ideal for sugarcane. 
Molecular tests for Fiji virus (Oceania) and sugarcane mosaic gemini 
virus (Africa) are under development at PGQO. Implementing these tests, 
which might result in provisional quarantine release, will require 
additional resources for the PGQO.
    (4) Rice: Molecular techniques are not required to accelerate 
pathogen diagnostic testing with rice, because the key pathogens are 
readily culturable bacteria. Half-time technical assistance is needed 
to fully utilize new greenhouse and screenhouse space for the rice 
quarantine program.
    (5) Currants and gooseberries: A PCR-based assay for the reversion 
virus in these plants should be implemented, but this will require 
APHIS approval and additional resources for PGQO.
    (6) Potatoes and sweet potatoes: A PCR-based test for phytoplama 
should be implemented to improve the accuracy and reliability of the 
potato/sweet potato pathogen detection, but would not necessarily 
accelerate the rate whereby germplasm is released from quarantine. 
Half-time technical assistance is needed to fully utilize new 
greenhouse and screenhouse space and to bolster this molecular testing 
program.
    Question. Have the germplasm materials at the Griffin, GA, and 
Pullman, WA, facilities been tested for viability?
    Answer. 18,781 (28 percent) of the 67,394 germplasm accessions at 
Pullman, WA have undergone germination testing at Pullman during the 
10-year period of 1989-1998. Most of the germination tests (15,481/
18,781, or 82 percent of the total tested) were conducted during the 
last 5 years (1994-1998).
    During the last 10 years, 331 (.04 percent) of the more than 78,000 
seed-propagated accessions at Griffin, GA have undergone germination 
testing. There are 1,100 clonally-propagated sweet potato accessions at 
Griffin that are regularly checked visually for health and vigor.
    Duplicate samples of 72 percent of the seed-propagated accessions 
from Griffin and 85 percent of the accessions from Pullman have been 
deposited at the National Seed Storage Laboratory, Ft. Collins, CO. The 
viabilities of many, but not all, of these duplicate samples were 
tested by NSSL before being deposited in long-term storage and the 
germination information made available to curators at Griffin and 
Pullman.
    Question. What percentage of the NPGS collection requires timely 
regeneration to maintain its genetic integrity?
    Answer. In our response, we assume that 1) ``timely'' means 
``during the next 2-5 years'' (consistent with the 1997 GAO study of 
the NPGS), and 2) ``regeneration'' is relevant for the 400,000 + seed- 
propagated NPGS germplasm accessions. Because of the variable quality 
and quantity of data available, the accuracy and precision of the 
following percentages vary. Across the NPGS, the median percentage of 
collections that require regeneration during the next 2-5 years seems 
to be about 30 percent.

  Estimated Percentage Requiring Refeneration During the Next 2-5 Years

        Selected NPGS collections                             Percentage
Tomato genetic stock (Davis)..................................     20-50
Soybean (Urbana)..............................................        55
Cotton (College Station)......................................     50-60
Seed-propagated fruits and nuts (Corvallis)...................        50
Seed propagated accessions at Ames............................        20
Seed propagated accessions at Griffin.........................        31
Seed propagated accessions at Geneva..........................        30
Small grains (Aberdeen).......................................        10
Seed propagated accessions at Mayaquez........................     10-50
Seed propagated accessions at Pullman.........................     10-25
National Seed Storage Laboratory (Ft. Collins)................        30

    Question. With current resources, and at the current rate of 
regenerating accessions, how long would it take ARS to regenerate those 
accessions?
    Answer. Regeneration rate is determined not only by fiscal 
resources available for that activity, but also strongly by the 
biological properties of each crop (breeding system, genetic 
constitution, growth rate, duration, etc.). Therefore, information for 
representative individual seed-propagated crops is presented. Because 
of the variable quality and quantity of data available, the accuracy 
and precision of the following figures vary. Across the NPGS, the 
median period required to regenerate these accessions seems to be more 
or less 10 years. But, importantly, for a substantial proportion of 
these accessions, especially of wild species (e.g., tomato, potato), 
research and development will be required to first develop methods for 
successful regeneration. Selected NPGS collections

            Estimated Years Required to Regenerate Accessions

        Selected NPGS collections                                  Years
Tomato genetic stock (Davis)..................................       2-5
Soybean (Urbana)..............................................         5
Cotton (College Station)......................................     10-15
Seed-propagated fruits and nuts (Corvallis)...................   ( \1\ )
Seed propagated accessions at Ames............................     10-23
Seed propagated accessions at Griffin.........................     12-15
Seed propagated accessions at Geneva..........................      1-32
Small grains (Aberdeen).......................................      5-10
Seed propagated accessions at Mayaquez........................        10
Seed propagated accessions at Pullman.........................      7-10
National Seed Storage Laboratory (Ft. Collins)................   ( \2\ )

\1\ No resources are currently available for regenerating those 
accessions.
\2\ Regeneration of base collection is conducted at active sites.

    Question. What percentage of NPGS germplasm is not in long-term, 
back-up storage?
    Answer. At present, ca. 104,000 (ca. 26 percent of total) seed 
samples and 26,000 (ca. 93 percent of total) clonally-propagated 
samples in the NPGS are not in long-term, backup storage at the 
National Seed Storage Laboratory, Ft. Collins, CO. Some of the samples 
that are not duplicated within the NPGS are duplicated in non-NPGS 
germplasm collections in the U.S., or in collections in other nations, 
or at International Agricultural Research Centers (IARCs). But, with 
budgetary cuts at universities, the IARCs and in developing nations, 
the increasing complications to international germplasm exchange 
associated with the Convention for Biological Diversity and other 
international germplasm legislation, the NPGS cannot assume that 
specific germplasm samples can always be secured on demand from 
international sources.
    Question. If germplasm is lost due to the lack of regeneration, is 
it always possible to replace it?
    Answer. No, it is not always possible to replace germplasm samples 
that are lost due to lack of regeneration when they are not duplicated 
within the NPGS, obtainable from other germplasm collections or 
genebanks within the U. S. or internationally, currently grown by 
farmers or produced by seed companies or nurseries, or if they are 
extinct in nature, as is the case with some wild species. Some of the 
genetic components of the ``lost samples'' may be conserved in other, 
genetically closely-related samples. But the degree of genetic 
redundancy between genetically closely-related samples may be quite 
variable and unpredictable. Consequently, germplasm managers in general 
do not assume that genetically closely-related samples necessarily 
contain precisely the same genetic components of the ``lost samples,'' 
some of which may be key to current and future genetic improvement of 
crops.
    Question. What percentage of the NPGS budget is spent on 
maintenance and regeneration?
    Answer. Of the total $22.7 million allocated to the NPGS about 65 
percent ($15 million) is devoted to germplasm conservation and 
preservation, which includes the activities of maintenance and 
regeneration. The remainder of the NPGS budget is allocated to 
germplasm acquisition, characterization, and agronomic assessment. At 
specific NPGS sites (e.g., plant introduction stations, crop- specific 
collections of grains, oilseeds, etc.) that both maintain and 
regenerate germplasm, the budgetary percentage devoted to maintenance 
and regeneration is often 75 percent or higher.
    Question. If there is not a substantial increase (on the order of 
$20 million) in the NPGS budget within the next couple of years, what 
are some of the forecast ramifications?
    Answer. The ramifications of a static NPGS budget for fiscal year 
2000- fiscal year 2004 can be forecast from both a fiscal and a 
programmatic standpoint. From a fiscal standpoint, consider the current 
budget of $22.7 million, and assume the following: 1) inflation reduces 
purchasing power at a rate of 3.3 percent per year (a ten-year mean of 
the non-pay/inflation factor used by USDA for planning); and 2) 
personnel costs increase by 3.2 percent per year (a ten-year mean of 
the pay factor used by USDA for planning). Given the preceding figures, 
and a static budget, during fiscal year 2000-2004, the purchasing power 
of the NPGS budget would decrease by 18 percent from inflation. During 
the same period, the current percentage (13 percent) of the NPGS budget 
devoted to non-salary items (equipment, operations, travel) would 
decrease by 17 percent to 11 percent. Adjusted for inflation, the non-
salary budget would effectively be reduced to less than 10 percent of 
the total NPGS budget. And, at certain NPGS sites, that percentage 
would be substantially less than 10 percent.
    A static budget during fiscal year 2000-fiscal year 2004 would have 
severe programmatic ramifications throughout the NPGS. Funding at many 
sites would be insufficient not only for salaries of temporary 
employees, but also of some permanent curatorial staff. At many sites, 
no funds would be available for utilities, travel, operations, facility 
repairs or expansion, supplies, or equipment. Position vacancies would 
be abolished to provide funds for operations.
    With a static budget during fiscal year 2000-2004, the NPGS would 
by necessity focus nearly exclusively on providing security for 
databases and for germplasm stored in coldrooms, greenhouses, and field 
plantings. Acquisition of endangered germplasm would slow or cease, as 
would evaluation of germplasm for agronomically or horticulturally 
valuable traits. The rate of duplicating (backing-up) germplasm and 
testing it for health, viability, or genetic integrity would slow or 
cease. Germplasm would move through the quarantine process more slowly, 
or not at all. Germplasm currently at risk would perhaps be endangered 
further, whereas additional germplasm might also be endangered. As the 
funds available for maintaining each accession shrank, the supply of 
germplasm would shrink, which would limit germplasm distribution, and 
impede the progress of important research and breeding programs. Should 
additional funds become available in later years, they would initially 
be devoted to restoring the NPGS to its state in fiscal year 1999, 
rather than to progress on new initiatives.
    A static budget would preclude the NPGS from exploiting the new 
tools of genomics and biotechnology to develop more effective and 
efficient means of maintaining and regenerating germplasm. The 
ramifications would be especially severe for clonally-propagated crops, 
many of which cannot now be preserved by long-term tissue culture or 
cryopreservation.
    Lastly, there is currently more public interest in conserving 
genetic diversity and in exploiting it for crop improvement than at 
anytime in the past. For example, soybean farmers through the United 
Soybean Board and state checkoffs have been and still are investing 
millions to exploit soybean germplasm. Researchers are already finding 
new genes for improved levels of disease resistance and yield. Genomic 
technology is identifying loci important for yield, seed composition, 
disease resistance and other economical important traits in soybean and 
other crops. The major funding increases for plant genomic research at 
NSF will generate many new specialized genetic stocks for the NPGS to 
manage. For example, NSF-funded research will generate at least 50,000 
new maize (corn) genetic stocks, which would more than double the size 
of the NPGS maize stock center. Just when researchers can use germplasm 
more effectively and efficiently than ever before, just when its 
clientele is demanding more from the NPGS, and just when the NPGS, if 
sufficiently funded, could deliver more than ever before to its 
customers, the NPGS will struggle just to maintain staff, facilities, 
and germplasm.
            biology and management of temperate fruit flies
    Question. The United States cherry and apple industry has brought 
to the Committee's attention the pressing need to develop effective 
pest control strategies for temperate fruit flies that minimize the use 
of chemical insecticides while adequately addressing the quarantine 
concerns of our industry's current and potential export markets. Do you 
agree that there is an unmet research need in this area and that the 
addition of a full-time entomologist at the Yakima, WA, research 
laboratory is required to conduct research on the biology and 
management of temperate fruit flies?
    Answer. The most promising controls for temperate fruit flies, 
including the cherry fruit fly and the apple maggot, in the United 
States is by the use of Integrated Pest Control (IPM) programs. 
However, an important component of the IPM program is pesticides that 
have an uncertain future resulting from provisions of the recently 
passed Food Quality Protection Act (FQPA). The registrations for some 
of the most useful of these pesticides may be dropped for horticultural 
crops including apples and cherries. This could result in greatly 
increased fruit fly problems including invasion of the apple maggot 
into areas currently declared free of apple maggot. This would not only 
present a problem for production of high quality cherries and apples 
but would also raise quarantine issues for apples and cherries that 
could halt their export to states and countries where these fruit flies 
do not occur. ARS assigns high priority to research to study the 
biology and management of temperate fruit flies. Additional funding for 
an entomologist would be an important boost for this research.
                            potato research
    Question. Is the ARS working with the National Potato Council on 
how funds available for potato research can best be used to address 
research priorities?
    Answer. Yes, ARS works closely with the leaders of the potato 
industry and the National Potato Council in developing research 
priorities and allocating funds.
    Question. Does the ARS agree that there is a need to continue 
research on site-specific management and to focus on the biology of 
potato production and that the addition of an agronomist to supplement 
the soil science and pathology research would greatly strengthen the 
potato program in Orono, Maine?
    Answer. Yes, potato production in northern Maine has shown a 
significant decline in recent years. This trend will, however, be 
reversed with the construction of a new potato processing facility in 
Maine by McCain Foods. It is estimated that 15,000 acres will be 
returned to potato production. The current ARS research program has 
included a search for alternative crops that could be used in a potato 
rotation. Potatoes are grown in three-year rotations with soybean, 
canola, green bean, sweet corn, and barley/clover. An interdisciplinary 
team of two scientists is evaluating cropping system impacts on soil 
nutrient dynamics and soilborne pathogen ecology. A third scientist is 
being recruited to assess crop management system interactions with 
potato late blight. The addition of an agronomist to supplement the 
soil science and pathology research will greatly strengthen the potato 
program in Maine. Estimated cost is $300,000/year.
    Question. Do you agree that an agronomist position (in addition to 
the weed and soil scientist for which recruitments are currently in 
process) to integrate the soil, weed, pathology and entomology 
information on potato production into a more effective system and 
achieve better quality as well as improved yield is needed at Prosser, 
WA, to continue research on site-specific management and to focus on 
the biology of potato production?
    Answer. Yes, the site-specific management research team at Prosser, 
WA is in the process of rebuilding after the loss of several 
scientists. A new soil scientist has been selected and will be on-board 
soon. Recruitment is underway for a new weed scientist. The objective 
of this team is to develop site-specific management strategies based on 
knowledge of the biology of the potato crop and its interactions with 
pests, pathogens, and the aboveground and below-ground environment. The 
resulting management systems will be more efficient in the use of 
resources, improve yield and quality of the crop, and reduce the risk 
of negative impacts on groundwater quality. To accomplish these goals, 
an agronomist to lead the research on potato biology and water 
management should be added to the Prosser group. Just as the plant 
integrates biological, chemical, and physical factors to determine 
yield and quality, the agronomist will be the point of integration for 
knowledge of potato biology, pathology, entomology, soil science, and 
weed science into an effective management system that is acceptable to 
growers. The estimated cost is $300,000/year.
          pasture-based beef systems for appalachia initiative
    Question. Please describe the cooperative agreement between the 
USDA ARS station in Beaver, WV; the Virginia Polytechnic Institute and 
State University; and West Virginia University for support of the 
Pasture-Based Beef Systems for Appalachia initiative.
    Answer. A cooperative agreement between the USDA ARS in Beaver, the 
Virginia Polytechnic Institute and State University, and West Virginia 
University does not formally exist. The three institutions have 
actively collaborated in the development of a cooperative research 
initiative for a Pasture-Based Beef System for Appalachia that 
capitalizes upon the complementary capabilities of the three 
institutions. This initiative will develop innovative concepts/
practices to enhance the efficiency, profitability and sustainability 
of pasture-based beef production systems in Appalachia. Systems for 
each of the different phases of cattle production and marketing will be 
compared. The initiative will be a long- term, multi-disciplinary/
multi-institutional regional effort that will impact and benefit small 
farms. The net result will be increased economic viability of small 
livestock producers, enhanced economic development of Appalachia and 
enhancement of the environment.
    Question. What level of effort, both in terms of dollars and 
scientific support, is ARS currently provided for this initiative and 
what increase is required to provide full ARS support for the 
initiative?
    Answer. At the present time, the initiative is unfunded though some 
effort at each institution is relevant to the objectives of the 
initiative. An increase of $2.5 million will be needed to effectively 
implement this project. Of this, $1.5 million annually would be shared 
equally between the three institutions to provide the critical mass of 
disciplines and infrastructure needed to sustain the program. The 
remaining $1 million will be used to meet special disciplinary/
resources requirements of the project to be distributed on a 
competitive basis among the three institutions. The annual request for 
proposals will be developed by consensus of the member institutions and 
will be based on the particular needs and stage of the project.
           fusarium head blight (wheat/barley scab) research
    Question. The fiscal year 1999 Appropriations Act provides 
increased funding for fusarium head blight research. Please describe 
the current level effort, both in terms of dollars and scientists, for 
the ARS base program and the ARS consortium with 12 land-grant 
universities, as compared with that in fiscal year 1998, and summarize 
research accomplishments to date.
    Answer. The current efforts for fiscal year 1998 and fiscal year 
1999 are as follows:

----------------------------------------------------------------------------------------------------------------
                                                         Fiscal Year 1998                Fiscal Year 1999
                                                 ---------------------------------------------------------------
                                                    Scientists        Dollars       Scientists        Dollars
----------------------------------------------------------------------------------------------------------------
In-House........................................        3.0 (SY)        $773,500        4.7 (SY)      $1,188,400
Consortium......................................  ..............         500,000  ..............       3,500,000
----------------------------------------------------------------------------------------------------------------

    Recent accomplishments within ARS include: the identification and 
maintenance of resistance genes from wild wheat relatives into wheat 
germplasm, the development of molecular markers for resistance genes, 
release of a scab- tolerant wheat variety for the upper Midwest, 
identification and isolation of genes that inactivate the toxin 
produced by the head blight fungus and incorporation of these genes 
into wheat and barley, and identification of anti- fungal genes that 
appear to inhibit the fungus.
    Question. Please describe the budget proposal for fiscal year 2000 
funding to address fusarium head blight or scab. What research 
enhancements are proposed for ARS? Is any increase in funding requested 
to support the consortium?
    Answer. The fiscal year 2000 budget proposes a $900,000 increase to 
fund fusarium blight research at St. Paul, Minnesota; Fargo, North 
Dakota; Peoria, Illinois; Madison, Wisconsin; Albany, California; and 
Raleigh, North Carolina. Research topics to be addressed include: 
genetics of resistance in spring and durum wheat, transformation of 
wheat and barley for fungus resistance and control of vomitoxin, 
biological control of the fungus, and disease epidemiology. The fiscal 
year 2000 budget does not request additional funding to support the 
consortium.
    Question. Describe the Wheat and Barley Scab Initiative. What parts 
of the plan have been implemented with the funding provided to date? 
What additional funding will be required to fully implement the 
research plan?
    Answer. The U.S. Wheat and Barley Scab Initiative is a consortium 
of representatives of the wheat and barley industries and university, 
ARS, and private researchers. Activities include research on all 
aspects of the disease, especially enhancement of genetic resistance to 
head blight in wheat and barley, disease epidemiology, and disease 
management strategies. The funding plan developed called for $5,125,000 
per year for 5 years, and the Wheat and Barley Protection Act of 1997 
authorized $5.2 million per year for a partnership between land grant 
universities and the federal government to address scab in wheat and 
barley. In fiscal year 1999, $3.5 million was appropriated to partially 
address each of the objectives. Full funding would require an 
additional $1.7 million per year.
    Question. The Committee has been asked ``to limit to no more than 5 
percent, the overhead charges'' deducted from ARS grants to land grant 
universities for the Scab Initiative. Please explain what percentage is 
taken from each of these grants and why it is taken.
    Answer. Universities typically charge an ``overhead'' or 
``indirect'' cost to extramural grants to partially defray in-house 
infrastructure costs of conducting the research. The percentages taken 
by the land grant universities for the grants in fiscal year 1999 were:

        University                                               Percent
North Dakota State University...........................................
University of Minnesota...........................................     5
Michigan State University.........................................    14
South Dakota State University.....................................    10
Ohio State University.............................................   5.5
University of Illinois............................................    10
Purdue University.......................................................
University of Missouri............................................     5
Kansas State University.................................................
University of Nebraska..................................................
North Carolina State University.........................................
University of Maryland..................................................
Cornell University......................................................
University of Kentucky..................................................
University of Arkansas..................................................
Virginia Tech...........................................................
University of Georgia.............................................    10
Louisiana State University..............................................
Washington State University.......................................    14

    Question. The Committee has learned that despite the fact that the 
Upper Midwest has been devastated by several serious plant disease 
epidemics over the past ten years caused by stem rust and fusarium head 
blight, there are currently no ARS scientists working on fungal 
diseases of barley in the region. Is this true? If so, does the ARS 
agree that federal support in combating serious disease in the region 
is desirable? What level of effort, in terms of dollars and scientists, 
would be required to do this?
    Answer. It is not true. Currently, ARS researchers in Madison, 
Fargo, and St. Paul are conducting research on fungal diseases of 
barley, including fusarium head blight, stem rust, and powdery mildew. 
Research areas include genetics of host plant resistance, genetic 
variability of pathogens, host- pathogen interactions, and enhancing 
host-plant resistance through conventional and biotechnological means.
                            turkey research
    Question. Please provide the Committee with a status report on ARS 
Poult Enteritis Mortality Syndrome (PEMS) research.
    Answer. During fiscal year 1999, the following has been 
accomplished:
  --Initial studies showed that turkey poults exposed to PEMS-infected 
        tissues exhibited immunosuppression prior to the enteritis and 
        this had a direct impact on the immune system, specifically the 
        thymus gland.
  --Turkeys exposed to thymus gland tissue from infected birds 
        developed a PEMS- like disease with mortality, severe growth 
        depression, enteritis, immunosuppression, and tissue atrophy.
  --A new virus has been isolated from the thymus of PEMS-infected 
        birds--a ''Small Round Virus'' (SRV). A culture system was 
        developed to grow and purify the virus. Initial experiments 
        indicated SRV can cause disease in turkey poults similar to 
        PEMS in the field. The virus is not identified by diagnostic 
        tests for common turkey enteritis viruses.
    Question. How soon will a diagnostic test be available for the 
rapid identification of the likely presence of the PEMS virus?
    Answer. Current studies are in progress to produce experimental 
antisera for development of diagnostic tests for use in the field. The 
antisera will be available for initial tests in 3-4 months. The ARS 
Southeast Poultry Research Laboratory (SEPRL) has committed to 
providing the antisera for initial testing at North Carolina State 
University, College of Veterinary Medicine and Purdue University 
Diagnostic Laboratory. Development and release of a commercial 
diagnostic kit is 12-18 months to the future.
    Question. Based on the fiscal year 2000 request for ARS funding for 
PEMS research, when do you estimate a vaccine will be developed? Would 
the hiring of a post-doctoral fellow to concentrate solely on PEMS 
vaccines and other therapeutic treatments reduce the time necessary to 
develop a vaccine? By how much would this additional research support 
reduce the time needed to develop a vaccine?
    Answer. Estimates based on current personnel and financial 
resources suggest a vaccine would be available within 3-5 years. 
Although the hiring of a post- doctoral fellow would allow a full-time 
person to work on the vaccine development alone, the prospect for an 
effective vaccine would be greater with the recruitment of a permanent 
scientist. This would require an additional $300,000 in permanent 
funds. This additional person would free the current personnel to work 
on the identification of the Small Round Virus, define its role in 
production of PEMS and development of the diagnostic tests. This could 
reduce the estimated time to vaccine development from the current 3-5 
years to a 1-3 years.
    Question. Avian pneumovirus is a new disease posing a potential 
serious threat to the turkey industry. The industry and the State of 
Minnesota have allocated more than $500,000 to pneumovirus research in 
the past year and are seeking a federal contribution to efforts to 
further refine diagnostic tests, improve disease containment 
procedures, and accelerate vaccine development. Is ARS currently 
involved in the University of Minnesota project? Is ARS performing any 
research related to this disease? What level of participation in the 
University of Minnesota project would be appropriate if resources were 
made available to the ARS to participate in this research effort?
    Answer. No direct or indirect involvement has been requested by the 
Minnesota Turkey Federation or the University of Minnesota. ARS has 
offered to assist in the Minnesota research effort, but such offers 
have not been accepted. Recently, several Minnesota pneumoviruses were 
sent to SEPRL for molecular analysis. This was the first occurrence of 
cooperation between ARS and the Minnesota state research effort on 
pneumoviruses.
    In fiscal year 1998, the National Veterinary Service Laboratory, 
Animal and Plant Health Inspection Service, USDA, requested assistance 
from SEPRL, ARS, in avian pneumovirus research, especially in analysis 
of the Colorado virus. In fiscal year 1999, pneumovirus research was 
incorporated into existing research efforts at SEPRL.
    ARS has conducted molecular epidemiologic evaluation of the initial 
avian pneumovirus from Colorado, making appropriate comparisons to the 
avian pneumoviruses Subtypes A and B of Europe and Africa. The findings 
indicated that the U.S. Colorado pneumovirus was a new subtype of 
pneumovirus distantly related to the European viruses and most likely 
not introduced from Europe or Africa. Other studies in progress include 
development of DNA-based tests for diagnostics, determining the 
reservoir and original source of the pneumoviruses in North America and 
understanding the disease and its control, including vaccines.
    ARS could assist in poultry experimental studies to determine the 
role of individual viruses in the field disease. Currently, APHIS has 
limited in vivo experiments to biological containment facilities which 
are lacking in Minnesota. SEPRL could provide additional assistance and 
coordination in molecular analysis and vaccine development.
                        eurasian avian influenza
    Question. The Senate report accompanying the fiscal year 1999 
appropriations Act encourages ARS scientists at Athens, GA, to provide 
technical assistance and to collaborate with other leading virologists 
and ornithologists to develop and assess baseline data on Eurasian 
birds as an influenza reservoir and their migration habits between 
Southeast Asia and North America and their breeding grounds in Alaska. 
Have ARS scientists assisted in this effort to assess the threat 
viruses from Eurasian birds migrating to the United States?
    Answer. The Southeast Poultry Research Laboratory (SEPRL), Athens, 
Georgia, has provided technical assistance, in the form of virus 
isolation, identification and characterization, to the University of 
Alaska since the summer, 1998. Additional assistance has been provided 
to the Department of Agriculture and Fisheries in Hong Kong on Asian 
Influenza. Currently, SEPRL has two Specific Cooperative Agreements 
with universities for establishing baseline data on Eurasian birds as 
influenza reservoir and their migration habits between Asia and Western 
North American (Cooperator: University of Alaska) and between Europe 
and Eastern North America (Cooperator: University of Georgia).
    Question. Do findings from surveillance efforts to date call for an 
increase in this screening effort? How many Eurasian avian influenza 
positives were found as a result of surveillance efforts last year?
    Answer. The findings to date cover only fall 1998 and winter 1999 
sampling and such data represents only 6 months of effort. Patterns of 
influenza ecology and identification of reservoirs can only be 
established from sampling over multiple years in wide geographic areas.
    Four avian influenza viruses were obtained from the 700 samples 
tested from Alaskan birds and 34 influenza viruses from 400 samples 
from the Midwest and Eastern US wild birds. The infected samples are 
being evaluated in studies to determine the genetic origin and 
relationships to Asian, European and North American avian influenza 
viruses. However, additional isolates need to be obtained from both 
locations in order to make the epidemiologic study viable by multi-year 
sampling.
    Question. What additional funding would be required for the Athens 
ARS laboratory to collaborate with the University of Alaska and the 
University of Georgia to further develop and assess these baseline 
data, specifically to increase the number and diversity of wild bird 
samples obtained and analyzed.
    Answer. The SEPRL will provide the virologic and molecular biologic 
components of both collaborative research projects. An additional 
$100,000 would allow the hiring of a post-doctoral research associate 
and the purchase of reagents to be used in the isolation and 
identification of the influenza viruses from a greater number of more 
diverse samples. Both university cooperators will provide the 
ornithologic expertise and obtain the diagnostic samples from wild 
birds in the field, and in the case of the University of Georgia, the 
initial virologic isolations from the Midwest and Eastern USA. The 
cooperators would need an additional $100,000 each to continue and 
enhance their field sampling activities. The total required funds would 
be $300,000.
                   national sedimentation laboratory
    Question. Please provide the fiscal year 1998, 1999 and proposed 
2000 funding levels for the National Sedimentation Laboratory.
    Answer. The fiscal year 1998, 1999 and proposed 2000 funding levels 
for the National Sedimentation Laboratory are respectively; $5,424,000, 
$5,424,000, and $5,964,000.
    Question. What level of funding is available for the Laboratory to 
conduct research on sources and causes of water impairment in the Yazoo 
River Basin and to seek economically feasible Best Management Practices 
for attaining new water quality goals (Total Maximum Daily Loads) at 
field, farm, watershed, and basin levels?
    Answer. In fiscal year 1999, the Laboratory will have $3,297,200 
available to conduct research on the sources and causes of water 
impairment in the Yazoo River Basin, and to develop economically 
feasible Best Management Practices for attaining new water quality 
goals in the Yazoo River Basin and Mississippi Delta. This does not 
include the $1,246,900 in financial support that the National 
Sedimentation Laboratory currently provides the University of 
Mississippi's Center for Computational Hydroscience and Engineering and 
National Center for Physical Acoustics. The fiscal year 2000 budget 
will provide the Laboratory with an additional $540,000 that will be 
used to expand the current research effort on water quality in the 
Yazoo River Basin, and to assess the performance and reliability of a 
broad spectrum of farming and resource management practices for 
attaining new water quality goals at farm, field, watershed, and basin 
levels.
                            genome research
    Question. Please describe the animal and plant genome research 
programs being carried out by ARS and the importance of that research.
    Answer. Plant Genome Research. The ARS' Plant Genome Research 
Program began in fiscal year 1990, and now has several major 
components: 1) development, enhancement, and maintenance of a genome 
database system for managing gene mapping and sequence information, and 
integrating the former information with knowledge of biological 
function and other attributes within and among crop species; 2) 
research that elucidates crop genome structure and organization, and 
that interrelates the preceding information to biological function so 
as to facilitate the manipulation of genomes to improve crops; 3) 
development of research tools, such as DNA libraries, molecular probes, 
and primers; and 4) development of bioinformatics software tools for 
characterizing and integrating complicated plant genome data. To date, 
this program has stressed the development of individual genome 
databases for several major crops (e.g., maize, wheat, soybeans) and 
software development and database management.
    ARS is currently allocating $3.9 million to plant genomic research 
for several major crops. New crop genome research and database support 
positions have been established at Ithaca, NY, in association with 
Cornell University, and at the Western Regional Research Center, 
Albany, CA. The ARS-Cornell partnership has been strengthened by 
establishing a joint center for comparative genomics and 
bioinformatics.
    The VA-HUD Bill (Public Law 105-65) in fiscal year 1998 approved 
$40 million to be allocated by the National Science Foundation (NSF) to 
a National Plant Genome Initiative focused on ``economically 
significant plants.'' In the first competition for these funds, nine 
ARS scientists were Principal Investigators or co-Principal 
Investigators on proposals that were funded. ARS is striving to ensure 
that its institutional genome research and database development efforts 
are coordinated with and effectively complement research funded by the 
new NSF program, and other crop genome initiatives.
    Importantly, the USDA/ARS Plant Genome Research program contributes 
to solving many of USDA/ARS's priority research problems. It addresses 
environmental deterioration (e.g., global change, water quality), 
promotes sustainability and profitability of crop production, improves 
the quality of food, fiber, feed, ornamentals, and industrial products 
by facilitating the development of new crops and crop varieties. These 
new crops and crop variants will use inputs more efficiently, and yield 
products with higher quality and higher value. This research program 
will also contribute to the optimal conservation and utilization of 
crop genetic resources.
    Animal Genome Research.--ARS initiated a program on animal genome 
mapping in 1988. In 1994, ARS scientists published the first genetic 
linkage maps in the world for livestock and was a key participant in 
the first genetic linkage map for poultry. Second generation linkage 
maps in cattle, swine, poultry and sheep were published in 1997. They 
are the most complete genetic maps for this livestock species available 
in the world. ARS scientists have established cooperative efforts in 
genome mapping and databases with scientists in State Agriculture 
Experiment Stations, other countries, and agribusiness companies.
    The USDA/ARS is currently allocating $9.1 million to animal genome 
research. ARS has programs on the identification of genes of importance 
for animal production, gene mapping, and gene characterization in 
cattle, sheep, swine, poultry, and fish at the U.S. Meat Animal 
Research Center, Clay Center, NE, Avian Disease and Oncology 
Laboratory, East Lansing, MI, Animal Physiology Research Unit, Athens, 
GA, National Animal Disease Center, Ames, IA, Beltsville Area Research 
Center, Beltsville, MD, and the Cool and Cold Water Aquaculture 
Research Unit, Leetown, WV. The improved genetic linkage maps permit 
ARS to direct research efforts to identify genes that regulate growth, 
lactation, reproduction, carcass traits and disease resistance. These 
efforts will improve production efficiency, resistance to diseases and 
parasites, and quality and safety of products, and keep U.S. 
agriculture competitive in international markets.
    Question. How will the increased funding requested for fiscal year 
2000 enhance this research effort?
    Answer. The Administration's budget for fiscal year 2000 requests 
an increase of $800,000 for animal genome research and $700,000 for 
plant genome research. The new funding for animal genome research will 
enable the Agency to augment its efforts to: 1) identify the genetic 
basis for productivity in dairy cattle and mammary gland resistance to 
mastitis (Beltsville, MD; $300,000); and 2) develop high throughput 
methods for comparing, analyzing, and storing large numbers of DNA 
sequences and gene variants (polymorphisms) so as to identify 
economically important genes in cattle and swine (Clay Center, NE; 
$500,000). The new funding for plant genome research will enable the 
Agency to augment its efforts to: 1) apply new genomic approaches to 
manipulating agriculturally important genes in crops (Albany, CA; 
$400,000); and 2) develop new bioinformatic tools, biological 
databases, and information management technology to generate, store, 
locate, arrange, interrelate, analyze and communicate the voluminous 
data produced by plant genomic sequencing, mapping, and other genomic 
research (Columbia, MO; $300,000).
                        human nutrition research
    Question. Two years ago, the Administration proposed an ARS Human 
Nutrition Research Initiative. Please distinguish research performed as 
a result of this initiative from the agency's ongoing nutrition 
education and research program at each of the Human Nutrition 
laboratories?
    Answer. The research performed as a result of the Human Nutrition 
Research Initiative can be distinguished from the agency's ongoing 
nutrition education and research program at each of the Human Nutrition 
Center's will be provided for the record.
    The ARS Human Nutrition Research Centers do not have a nutrition 
education program. However, Children's Nutrition Research Center at 
Baylor College of Medicine has a nutrition specialist person that is 
employed by USDA's Cooperative Research, Education, and Extension 
Service.
    The Initiative strengthens ARS' integrated, multi-disciplinary 
human nutrition research program by using new approaches to elucidate 
the fundamental interrelationships between diet, genetics, and health, 
and by applying and validating strategies to stimulate healthy food, 
nutrition, and lifestyle behaviors. Specifically, it has allowed the 
ARS Human Nutrition Research Centers to focus on the following five 
vital concerns: food, phytonutrients and health; healthy body weight to 
avoid diabetes and other diseases; brain function and resistance to 
mental decline; bone growth and protection from osteoporosis; and foods 
and nutrients' roles in preventing infectious disease. This funding has 
allowed the Grand Forks Human Nutrition Research Center to examine the 
role of trace minerals in gene expression; the Human Nutrition Research 
Center on Aging was able to examine the influences of diet on loss of 
immunocompetence and other functions during aging, including examining 
the relationship between diet, adult-onset Type 2 diabetes, functional 
disabilities, and food security in a Hispanic population; the 
Children's Nutrition Research Center at Baylor has examined how fetal 
nutriture affects later human development and functioning, specifically 
how in-utero nutrition may alter the course of human development and 
produce permanent consequences for the child after birth; the Western 
Human Nutrition Research Center has examined the molecular links 
between gene expression, dietary intakes, individual nutrient 
requirements, and risk of disease; the Arkansas Children's Nutrition 
Center has examined the molecular basis for nutrient effects on 
cognitive development of children, in addition, they are examining 
phytonutrient compounds extracted from soybean (components part of soy-
based infant formulas) and how they might reduce the risk of various 
cancers; and the Beltsville Human Nutrition Research Center was able to 
establish a new ARS project for research on diet and flavonoid (a major 
constituent of fruits and vegetables) function, which is to determine 
the bioavailability of flavonoids and their role as biomarkers of 
health status.
    Question. What has been accomplished to date from increased funding 
made available for the Human Nutrition Research Initiative?
    Answer. Some of the accomplishments to date will be provided for 
the record.
Jean Mayer USDA Human Nutrition Research Center on Aging at Tufts 
        University, Boston, Massachusetts
    Dietary Antioxidants and Aging.--High dietary intakes of 
antioxidant vitamins and phytochemicals are associated with better 
maintenance of physiologic function and a lower prevalence of many 
degenerative conditions in older adults. Understanding how antioxidants 
reduce oxidative stress and impact the pathogenesis of chronic disease 
present opportunities for health promotion. There is a compelling body 
of scientific evidence that suggests that free radical pathology is 
associated with many of the chronic diseases that are common among 
older adults, e.g., cancer, heart disease, and degenerative eye 
disorders. It has been found that the food matrix in which carotenoids 
are found affects their bioavailability. Chicken eggs may serve as a 
rich dietary source of bioavailable lutein and zeaxanthin, two common 
carotenoids, possibly due to the lipid matrix of the yolk in which they 
are located. Antioxidant status as assessed by measuring plasma 
antioxidant capacity can be with increased consumption of fruits and 
vegetables. This is the first time anyone has demonstrated that 
antioxidant status can be altered with increased fruit and vegetable 
consumption.
    Nutrition, Aging and the Immune Response.--The long recovery period 
and pathology associated with infectious disease has a debilitating 
effect on functionality and quality of life in elderly; and infectious 
diseases are among the leading causes of death in this age group. 
Nutrients play an important role in regulation of the immune response 
and host defense against infectious diseases. Understanding the 
mechanism of nutrient modulation of the immune response during aging 
will help in designing effective interventions. Consumption of up to 
800 IU/day for six months of vitamin E had no adverse effect in healthy 
elderly and significantly improved their immune response. One of the 
mechanisms by which vitamin E contributes to the reduction of risk of 
atherosclerosis and cancer is through modulation of immune and 
endothelial cell interaction, production of several chemokines, pro-
inflammatory cytokine and modulation of angiogenesis. Green tea 
flavonoids showed similar but more potent inhibitory effects on 
angiogenesis compared to that observed with vitamin E.
    Bone Health in the Elderly.--The current RDA does not appear to 
support optimal functioning of vitamin K-dependent proteins in bone. 
These observations are of concern because vitamin K has recently been 
identified as a potentially important nutrient that can affect bone 
mineral density and the risk of hip fracture. A sub-clinical deficiency 
of vitamin K showed significant increases in abnormal forms of vitamin 
K-dependent proteins. These investigations showed a direct evidence 
that dietary depletion of vitamin K has a detrimental impact on bone 
metabolism in humans. Repletion of vitamin K restored function of 
vitamin K-dependent proteins, and bone resorption levels returned to 
baseline.
Grand Forks Human Nutrition Research Center, Grand Forks, North Dakota
    Micronutrients.--Copper deficiency can lead to anemia, low white 
blood cell count, bone loss, poor growth, and some forms of heart 
disease. ARS researchers have identified a link between copper 
deficiency during pregnancy and neurological defects in the offspring 
of laboratory animals. Mice fed diets lacking adequate copper 
throughout pregnancy and for a few weeks after delivery; had altered 
observed enzyme levels in the brains of pups and changes in protein 
kinase C, an enzyme involved in the development of the nervous system. 
These findings may have implications for human mothers by showing the 
importance of an adequate copper intake during pregnancy.
    The major signs of copper deficiency found in depleted men and 
women resemble the most common characteristics that can predict risk of 
ischemic heart disease in people. Although official recommendations 
about desirable amounts of dietary copper have been made, no 
Recommended Dietary Allowance has been assigned. In addition to the 
link of low dietary copper to ischemic heart disease there has been a 
recently identified link between heart disease and osteoporosis. 
Adequate dietary copper is required for health of both hearts and 
bones. Mice deficient in copper had fragile bones.
    Strong evidence was found supporting the view that glycation, the 
undesirable binding of sugar to proteins, is enhanced in dietary copper 
deficiency. Because glycation is a process that is increased in 
diabetes and aging, the present finding suggests that reduced copper 
intake may worsen the consequences of these two conditions.
    Zinc is essential for growth and early development, but the 
relationship between zinc and cognition in later development is largely 
unknown. ARS scientists determined that short-term supplementation with 
zinc combined with other micronutrients may improve some aspects of 
cognitive function of school-aged Mexican-American children, who are at 
increased risk for zinc deficiency primarily because of high intakes of 
dietary phytate.
Beltsville Human Nutrition Research Center, Beltsville, Maryland
    Bioavailability, Transport and Antioxidant Activity.--ARS 
scientists have been able to demonstrate that lesser known carotenoids 
in tomato, phytofluene and phytoene, are much more bioavailable from 
tomato juice than is the dominant tomato carotenoid lycopene. The 
mechanism of protection of tomato products dies not appear to be 
related to immune function as judged from a T-lymphocyte proliferation 
assay. ARS plant scientists and nutritionists have developed a variety 
of tomato that is rich in phytofluene and phytoene. They have shown 
that the carotenoid content of colon cells is markedly increased in 
humans consuming carotenoid-rich vegetables, thus relevance to colonic 
cell mutagenesis is likely.
    Diet and Infectious Disease.--Nutritional interactions may play a 
significant role in the etiology of several chronic degenerative or 
acute infectious diseases. ARS scientists have shown that dietary 
oxidative stress increases viral virulence apparently by changing the 
genetic nature of the virus as it replicates with the host. Nutritional 
status of an individual, especially in vitamin E and selenium, appears 
to affect virulence and genetic structure of the virus.
Children's Nutrition Research Center, Baylor College of Medicine, 
        Houston, Texas
    Calcium Intakes in Girls.--Most of the calcium found in the body is 
in teeth and bone. The remaining small percent plays a role in 
mediating vascular constriction and vasodilation, muscle contraction, 
nerve transmission and glandular secretion. Calcium reference intake 
values must be set at levels associated with maximum retention of body 
calcium. ARS scientists showed that girls must increase their calcium 
intakes at the earliest onset of puberty, rather than previously 
accepted ages, since peak mineral accumulation occurs at an early age.
    Body Composition.--Obesity affects 20-30 percent of the U.S. 
population. Obesity is an increasing problem in children. Children and 
adolescents expend less energy and become more sedentary as the social 
encounters revolve around electronic devices. Dieting has not been 
successful for the long-term control of obesity. Consequently, a 
thorough knowledge of the metabolic and endocrine factors controlling 
fat deposition is needed in order to rationally modify the current 
trends. A complete body composition profile has been obtained in 
children ages 3-18 representing white, black and Hispanic populations. 
Preliminary analyses indicate that new standards are needed and that 
these must be ethnic and gender specific.
    Growth and Neurodevelopment.--Breastfeeding optimizes brain 
development and reduces infections and allergy. Understanding how milk 
is made, and understanding what controls how much milk is made, will 
tell us what we need to know to improve milk quantity and composition 
and promote breastfeeding. ARS scientists were able to identify the 
possibility of genetic factors related to calcium absorption and 
utilization. They showed that GLUT1 glucose transporter is responsible 
for transferring glucose, the major sugar in the mother's blood, to the 
place where milk sugar is made in breast cells. This is significant 
because the amount of milk sugar the breast cells make determine how 
much milk is produced.
Western Human Nutrition Research Center, San Francisco, California
    Diet, Antioxidants, and Optimal Health.--Studies have shown that 
vegetables rich in beta-carotene protect against heart disease and 
cancer. The amount of beta-carotene that it takes to prevent chronic 
disease is not known. In well-controlled carotenoid depletion studies 
ARS scientists examined the effective range of beta-carotene in the 
antioxidant defense system of healthy women. They found that maximal 
protection occurred at low, physiological concentrations of beta-
carotene. They are identifying groups of people that have low beta-
carotene status and might need targeted nutritional guidance on beta-
carotene.
    Healthy Body Weight: Influences of Nutritional, Biological and 
Environmental Factors.--The conditions of overweight and obesity are 
leading nutritional problems in the U.S. National surveys indicate that 
97 million American adults or 55 percent of the population are 
overweight or obese, and the prevalence is escalating. Thus, achieving 
and maintaining a healthy body weight is a concern of many Americans. 
ARS scientists demonstrated that during a prolonged period of dietary 
energy restriction in women, the levels of plasma leptin, a protein, 
were predictive of sensations of hunger. This is the first report 
linking leptin to long-term appetite regulation in humans. Iron status 
declined in about half of the women subjects during the energy 
restriction. The inability to sustain attention may be an early 
cognitive indicator of developing iron insufficiency in these women. 
Bone mineral content of obese women did not decline after a 3-month 
period of energy restriction. However, in premenopausal women, those 
who chronically restrained their dietary intake for the purpose of 
weight control had significantly lower bone mineral density.
Arkansas Children's Human Nutrition Research Center, Little Rock, 
        Arkansas
    Soy-based Infant Formulas.--The same protein extracted from 
soybeans and used as the exclusive protein source for over 95 percent 
of the world's soy-based infant formulas will reduce the risk of 
various cancers when fed to animals. In addition, the factors 
associated with these proteins circulating in the human body after 
consumption are being examined.
    Question. Please describe the nutrition education and research 
program at each of the ARS Human Nutrition labs. Provide the fiscal 
year 1998 and 1999 levels of funding and staffing (FTE) for each lab.
    Answer. The ARS Human Nutrition Research Centers do not have a 
nutrition education program. However, Children's Nutrition Research 
Center at Baylor College of Medicine has a nutrition extension 
specialist that is employed by USDA's Cooperative Research, Education, 
and Extension Service. The research carried out by each of the ARS 
Human Nutrition Research Centers will be provided for the record.
    Beltsville Human Nutrition Research Center, Beltsville, Maryland.--
defines the role of food and its components in optimizing health and 
reducing the risk of nutritionally related disorders in the diverse 
American population. To accomplish this mission, the Center develops 
new methods of food analysis; determines the role of nutrients and 
their interactions in maintaining health; monitors nutritional intakes 
and maintains the database of the nutrient content of foods; studies 
the expenditure of energy by using direct and indirect calorimetry; and 
investigates the consequences of altered nutrient intakes in free-
living humans.
    Jean Mayer USDA Human Nutrition Research Center on Aging at Tufts 
University, Boston, Massachusetts.--defines safe and adequate nutrient 
intakes and identifies factors that may contribute to degenerative 
processes associated with aging. To accomplish this mission, the Center 
determines factors related to prevention of age-related loss of bone 
density leading to osteoporosis and fracture, and the preservation of 
muscle strength; identifies dietary factors critical in slowing or 
preventing cataract development; determines the relation of antioxidant 
food components to heart disease and immune function; and explores 
relationships between vitamins and brain function, stroke, and 
dementia.
    Grand Forks Human Nutrition Research Center, Grand Forks, North 
Dakota.--determines nutrient needs for humans with an emphasis on 
mineral element requirements that prevent disease and promote health 
and optimal function throughout life. To accomplish this mission, the 
Center determines the importance of mineral elements at the molecular 
level with an emphasis on chronic disease; identifies detrimental 
functional changes, especially in bone, brain, cardiovascular and 
reproductive systems, that occur in the U.S. population because of 
improper mineral element nutriture; identifies and validates 
biochemical and physiological status assessment indicators for use in 
the study of populations at risk from inadequate mineral element 
nutrition; and defines the impact of environmental, dietary, 
physiological and psychological stressors on specific mineral 
requirements.
    Children's Nutrition Research Center at Baylor College of Medicine, 
Houston, Texas.--defines the nutritional needs of pregnant and 
lactating women and of their infants and children from conception 
through adolescence. To accomplish this mission, the Center establishes 
nutrient requirements to prevent low birth weight babies, particularly 
in pregnant adolescents; elucidates nutrient-gene interactions that 
regulate metabolism and disposition of nutrients; determines nutrient 
requirements for growth and development of school-aged and adolescent 
children; and establishes nutritional relationships to acute and 
chronic childhood diseases.
    Western Human Nutrition Research Center, San Francisco, 
California.--determines the impacts of dietary, environmental, 
behavioral, and genetic factors on nutrient requirements and functions. 
To accomplish this mission, the Center establishes markers of 
nutritional status in relation to maintenance of healthy body weight, 
nutrition, infection and immune disorders; and protective factors in 
foods.
    Arkansas Children's Nutrition Research Center, Little Rock, 
Arkansas.--determines the role of nutrition in cognitive and behavioral 
function, and the health consequences of infant consumption of dietary 
factors (phytochemicals) such as phytoestrogens on endocrine and 
metabolic development and prevention of chronic diseases.
    The funding and staffing for the ARS Human Nutrition Research 
Centers and related programs for fiscal years 1998, and 1999 will be 
provided below for the record.
    [The information follows]:

                                                 HUMAN NUTRITION
----------------------------------------------------------------------------------------------------------------
                                                                  Fiscal year              Fiscal year
                        Location (FTE)                          1998 estimated    SY's   1998 estimated    SY's
----------------------------------------------------------------------------------------------------------------
Arkansas Children's Hospital Research Institute, Little Rock,       $2,769,500  .......      $3,519,500  .......
 AR...........................................................
Western Human Nutrition Research Center, San Francisco, CA....       5,537,500       11       5,717,200       12
Jean Mayer USDA Human Nutrition Research Center on Aging,           14,909,000        3      15,159,000        3
 Boston, MA...................................................
Beltsville Human Nutrition Research Center, Beltsville, MD....      18,645,200       36      19,609,900       37
Grand Forks Human Nutrition Research Center, Grand Forks, ND..       8,204,400       12       8,351,700       12
Children's Nutrition Research Center, Houston, TX.............      11,191,700        4      11,691,700        4
National Agricultural Library.................................         675,000  .......         675,000  .......
Lower Mississippi Delta Intervention Research Initiative, (LA,       3,147,700  .......       3,147,700  .......
 AR, MS)......................................................
Other Locations...............................................       1,265,000        5       1,249,300        5
Headquarters (Special CSFII Samples for Children, FQPA).......       5,000,000  .......  ..............  .......
                                                               -------------------------------------------------
      Totals..................................................      71,345,000       71      69,121,000       73
----------------------------------------------------------------------------------------------------------------

    Question. Is ARS conducting any nutrition education and research 
outside of the Human Nutrition labs? If so, please describe the 
education and research being conducted and where it is being conducted.
    Answer. The nutrition education and research conducted outside of 
the ARS Human Nutrition Research Centers will be provided for the 
record.
    ARS does not conduct nutrition education at any of the nutrition 
laboratories outside the ARS Human Nutrition Research Centers.
    The Lower Mississippi Delta Nutrition Intervention Research 
Initiative (NIRI) is conducted by a consortium of seven partners: 
Alcorn State University, Arkansas Children's Hospital Research 
Institute, Pennington Biomedical Research Center, Southern University 
and A&M College, University of Arkansas at Pine Bluff, University of 
Southern Mississippi, and ARS. The mission of the Delta NIRI is to 
evaluate the nutritional health in the Lower Delta, to identify 
nutritionally responsive problems, and to design and evaluate 
interventions which may be sustained at the community level and 
implemented on a larger scale in similar areas of the United States.
    The research conducted by the U.S. Plant, Soil and Nutrition 
Laboratory, Ithaca, New York, has a human nutrition component that 
examines the absorption and utilization of organic and mineral 
constituents of plant foods. ARS scientists are identifying and 
depicting dietary and physiological factors that interact to affect 
absorption, distribution and utilization of organic and inorganic 
constituents in plant foods.
    Human nutrition research conducted at the ARS National Center for 
Agricultural Utilization Research, Peoria, Illinois has examined the 
effect of triglyceride structure and dietary fat composition on fatty 
acid and lipid metabolism in humans.
                       integrated pest management
    Question. How has ARS research to date contributed to progress made 
toward the Administration's goal of implementing integrated pest 
management (IPM) programs on 75 percent of the Nation's crop acreage by 
the year 2000?
    Answer. During the past 15 years, USDA agencies, including ARS, 
have developed research, education, and extension programs to support 
the policy of implementing IPM programs on 75 percent of the Nation's 
crop acreage by the year 2000. Of

course, strong interagency coordination and cooperation with the 
Departmental Agencies, including CSREES, AMS, ERS, and NASS and other 
public and private sector organizations is vital if IPM is to be 
implemented in the United States and the year 2000 goal is to be 
achieved. The USDA has developed a Strategic Plan, completed in 1993, 
for implementation of USDA's Integrated Pest Management Initiative. 
Under the plan, specific strategies to attempt to meet the year 2000 
goal have been formulated for each Agency. ARS currently carries out a 
program, using base funding, that conducts research to meet the needs 
of the policy. ARS has approximately 70 projects at 29 locations 
conducting basic and applied research directly related to IPM. Current 
and planned future IPM studies in support of the Department's IPM goal 
are tailored to each pest and designed to be sustainable over time.
    Emphasis of the ARS IPM program is placed on biological, cultural, 
and other biorational technologies. In addition, special programs are 
underway to facilitate the transfer of new IPM technologies from small-
scale research studies to producers, which typically require large-
scale tests. An area-wide IPM program initiative has been developed by 
ARS in collaboration with other federal and state agencies, as well as 
private entities. An area-wide pest management pilot study using mating 
disruption for codling moth on tree fruits in the Pacific Northwest was 
fully implemented in fiscal year 1995, followed by full implementation 
of another area-wide program using an adult attracticide against the 
corn rootworm in the midwestern United States in fiscal year 1997. A 
third area-wide IPM program was initiated by ARS in 1997 and is 
directed at the leafy spurge weed in Montana, North and South Dakota, 
and Wyoming, using primarily a natural insect predator. The numerous 
other ARS IPM research projects in support of the Department's IPM 
initiative emphasize traditional biological control, host-plant 
resistance, behavior-modifying chemicals (e.g. pheromone mating 
disruptors), resistance management, cultural practices, improved 
pesticide application technologies, and other related control 
technologies. Target pests include a multitude of insects, mites and 
ticks, plant pathogens and nematodes, and weeds.
    The Agency's IPM and area-wide programs are involved with the 
development of potential substitutes to the 95 organophosphate and 
carbamate pesticides currently on the EPA priority list of pesticides 
to be reviewed and possibly terminated for grower use under FQPA. For 
example, pheromone mating disruption of codling moth in apples and 
pears will substitute for azinphos-methyl. A semio- chemical 
attracticide bait will substitute for methyl parathion and carbaryl in 
the control of corn rootworms; the leafy spurge predatory insect, 
Apthona, will substitute for certain herbicides on the EPA list; kaolin 
clays could substitute for methylchlorpyrifos, methyl parathion and 
other chemical insecticides in the control of orchard pests; and 
photoactive compounds in a bait matrix could substitute for 
chlorpyrifos and diazinon for imported fire ant control. These examples 
are only a small sampling of substitutes of the more than 90 
technologies that ARS has in the developmental pipeline currently to 
help address the impact of FQPA.
    Much progress has been made by ARS in generating pest management 
technologies for use in the Nation's IPM systems to meet the year 2000 
goal, and only a select few are mentioned here:
    As a result of the area-wide codling moth management program, 
mating disruption technology is being used widely in the apple and pear 
growing areas of the western U.S. In 1994, before the area-wide program 
was initiated, only 11,000 acres were treated with mating disruption 
technology in Washington State. During 1997, more than 30,000 acres 
were treated with mating disruption technology, almost tripling the 
usage in 3 years. There were more than 44,000 acres using the 
technology throughout Washington, Oregon, and California in 1997 and 
1998. A result of the diminished use of hard pesticides has been a 
resurgence in the natural enemy populations that have exerted almost 
complete control of secondary pests. This has further reduced the costs 
of insect control on apples and pears in this three-state area. 
Populations of codling moth were reduced to almost undetectable levels 
at some of the 17 project sites. The cost of the control was less in 
the mating disruption treated orchards than in orchards treated with 
conventional organo-phosphate pesticides. The number of pesticides 
sprays were reduced in all orchards under the area-wide program and 
were entirely eliminated at most of the project sites. Because of the 
overwhelming success of the program, thus far, numerous other growers 
in these states have indicated their desire to be included in this 
large-scale IPM program.
    Corn rootworm populations can be reduced by 85 to 95 percent with 
less than 10 percent of the chemicals used in current corn rootworm 
control regimes by using adult attracticide baits developed by ARS and 
now marketed by industry. This technology is the basis for the area-
wide IPM program on corn rootworm in the midwestern U.S. and Texas. 
More than 25,000 acres are included in the research demonstration 
project. This technology could ultimately become the treatment of 
choice on the 20 million acres of U.S. cropland currently treated with 
corn rootworm insecticide, in combination with transgenic corn.
    ARS scientists imported and developed a black flea beetle for 
control of the weed, leafy spurge, in the Midwest during 1988. By 1995, 
leafy spurge was virtually eliminated at the release sites in North 
Dakota and Montana. This technology is one of the major strategies 
being used in the area-wide program on leafy spurge in the northern 
plains of the U.S., which includes the States of Montana, Wyoming, and 
North and South Dakota.
    This past year, extensive fundamental, ecological, biological, and 
IPM research on the silverleaf whitefly and its natural enemies 
produced strategies for an ecologically-based management system. Some 
crop management and community- oriented farm decision-based practices, 
such as water-use patterns, and proximity of alternate host crops; and 
spatial considerations have been implemented in an effort to provide 
overall silverleaf whitefly population reductions. Area-wide, 
community-based IPM approaches covering infested crops were implemented 
across the southern tier of the U.S., and growers now have available 
cotton cultivars, which are less susceptible and have reduced losses 
from whiteflies. New commercial safer pesticides have been tested and 
made available, and new biological control agents have become available 
on the market, such as a natural fungus agent that was discovered and 
developed by ARS, and a number of parasites.
    ARS developed a nematode biological control agent, Steinernema 
riobravis, for control of pink bollworm, corn earworm, and fall 
armyworm, among others. Biosys, Inc. started selling the nematode-based 
product commercially in 1994-95 for use in IPM systems. Photodyes have 
been developed for use in fruit fly IPM systems for control and for 
possible use in eradication of these pests from Hawaii and the 
mainland. ARS scientists have found that releasing large numbers of the 
boll weevil parasite, Catolaccus grandis, on infested cotton can kill 
up to 95 percent of the weevils. This biocontrol agent has great 
potential when used in an IPM system or eradication scheme for boll 
weevils.
    A new pear variety has been developed by ARS that resists fire 
blight disease and will reduce chemical pesticide use and improve 
export markets. Sugarbeet cultivars have also been developed and 
released with resistance to leafspot and root and crown rot.
    Other projects that contribute to the overall IPM program include a 
community-based field trial study for control of the deer tick and lyme 
disease in the northwestern United States, the management of Colorado 
potato beetles and aphids with biological control systems and cultural 
practices to lessen the need for chemical insecticides, and the 
management of cotton plant bugs in post-boll weevil eradication zones.
    The anticipated outcome of these projects will be the adoption of 
the component technologies by end-users into IPM and sustainable 
agriculture system with a concomitant reduction; in chemical pesticide 
use and increased worker and food safety. Most of these projects are 
using alternative technologies that will substitute for at-risk 
chemical pesticides and which could be lost as a result of the Food 
Quality Protection Act. The ARS, the Animal and Plant Health Inspection 
Service (APHIS), and the Cooperative State Research, Education, and 
Extension Service (CSREES), in cooperation with other USDA agencies and 
local and regional organizations and producers will continue to 
cooperatively implement IPM research, education, and proactive 
technology transfer programs to help growers to adopt new IPM 
practices.
    Question. An increase of $3.17 million is requested for fiscal year 
2000 for the Food Quality Protection Act (FQPA) research initiative. 
Please describe this initiative more fully. What resources is ARS 
currently committing to this initiative and where is the research being 
conducted?
    Answer. Department policy places high priority on funding, 
development, and testing of safe substitute technology for currently 
used pesticides at risk of being phased out after review by EPA under 
FQPA, including the development of area-wide pest management programs 
using biointensive IPM approaches, biological control agents, and other 
IPM components technology.
    Research funded by the proposed increase will allow ARS to expand 
support for its area-wide IPM research demonstration programs based on 
the use of biorational and biologically-based strategies for control of 
key pests where organophosphate and carbamate pesticides are used 
primarily as management agents. New projects selected for 
implementation will be chosen through a scientific review process with 
a major criteria tied to replacement technology for at-risk pesticides. 
ARS also needs to expand its IPM component research for pests of fruits 
and vegetables treated with organophosphates and carbamates, as well as 
for pests under large-scale action agency eradication or control 
programs, such as boll weevil and the silverleaf whitefly, a vector of 
crop diseases. These programs will specifically help U.S. agriculture 
adjust to changes resulting from implementation of FQPA and the cost of 
chemicals currently used against these pests.
    Finally, the increase in funds will be used to support the USDA 
Office of Pest Management and Policy (OPMP). The Office functions to 
improve USDA's ability to address FQPA by improving integration and 
coordination of pest management and pesticide data programs and by 
strengthening communications with the existing network of grower 
organizations and crop specialists at land-grant institutions. The 
activities coordinated by OPMP will help increase USDA's responsiveness 
to the pest management needs of the agricultural community. Overall, 
OPMP has been designated as USDA's lead office on pest management 
policy and will coordinate USDA's interface with EPA, FDA, growers, and 
interested groups on pest management and pesticide-related issues. OPMP 
will be directly responsible for developing and implementing the 
Department's overall pest management strategy to adequately meet the 
needs of growers throughout the FQPA implementation process.
    The current location and funding for the Food Quality Protection 
Act research initiative for fiscal year 1999, as addressed by the 
Agency's IPM research programs, will be provided for the record.
    [The information follows:]

        Location                                  Fiscal year 1999 funds
Fresno, CA..............................................        $991,200
Salinas, CA.............................................         535,900
Shafter, CA.............................................         226,700
Ft. Lauderdale, FL......................................       1,265,200
Gainesville, FL.........................................       1,414,500
Miami, FL...............................................       1,463,100
Byron, GA...............................................         195,800
Tifton, GA..............................................         849,900
Ames, IA................................................         142,400
West Lafayette, IN......................................          84,800
Manhattan, KS...........................................         358,800
New Orleans, LA.........................................          86,400
Beltsville, MD..........................................       2,926,500
Morris, MN..............................................         223,600
Columbia, MO............................................          88,400
Stoneville, MS..........................................       2,018,800
Sidney, MT..............................................       1,386,200
Raleigh, NC.............................................         146,100
Lincoln, NE.............................................         274,900
Ithaca, NY..............................................         123,400
Stillwater, OK..........................................         194,500
Charleston, SC..........................................         524,900
Brookings, SD...........................................       1,944,200
College Station, TX.....................................         841,600
Kerrville, TX...........................................         409,900
Weslaco, TX.............................................         904,500
Prosser, WA.............................................         142,000
Pullman, WA.............................................         222,700
Yakima, WA..............................................       2,747,300
Washington, DC..........................................         250,200
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      22,984,400

    Question. Why is USDA's Office of Pest Management Policy being 
funded by the ARS? What is the role of this office and when was it 
established? Please provide the level of resources, in terms of dollars 
and full-time equivalent staff years, allocated for this office for 
each fiscal year.
    Answer. Because of the central role of ARS laboratories and field 
research facilities in crop production and pest management research, 
housing the Office in ARS provides the Office of Pest Management Policy 
(OPMP)with ready access to a large existing network of scientific 
resources and expertise. These resources are fundamental to the OPMP 
mission of better informing EPA's decision processes and, when 
necessary, leading efforts to develop strategies to transition to lower 
risk pest management tactics. OPMP has assumed the responsibilities of 
the NAPIAP program and it is reasonable to maintain funding in ARS and 
follow the NAPIAP model of drawing upon other Departmental resources as 
necessary. OPMP works cooperatively with CSREES to maintain and fully 
utilize the network of crop production in the land grant system.
    The OPMP was created in response to the demands of the Food Quality 
Protection Act (FQPA) for the Department to better integrate and 
coordinate numerous programs related to pesticides and pest management. 
In addition, OPMP serves as the primary contact point for EPA and 
agricultural producers on pesticide matters. Deputy Secretary Rominger 
announced the Office in September of 1997 and it became effective in 
February, 1998.
    The resource level has remained constant and equal to the former 
ARS-NAPIAP budget of $1.192 million in 1998 and $1.089 million in 1999. 
This level of funding supports approximately ten full time equivalent 
staff members. Additional funding is sought in fiscal year 2000 to meet 
the demands of the FQPA and to develop strategies allowing agricultural 
producers to transition away from pest management chemicals that have 
been targeted by the EPA risk assessment process.
                              food safety
    Question. What food safety research will ARS conduct in fiscal year 
1999, and what is proposed for fiscal year 2000? Provide a brief 
description of each research project.
    Answer. In fiscal year 1999, ARS is undertaking $69,867,600 food 
safety research specifically in the areas of detection and prevention/
control of foodborne hazards; antimicrobial/antibiotic resistance; risk 
assessment; and food handling, distribution and storage, consisting of: 
40 projects ($14.2 million) in detection of foodborne pathogens; 70 
projects ($37.9 million) in prevention and control of pathogens; 7 
projects ($2.2 million) in anti-microbial/antibiotic resistance; 9 
projects ($4.9 million) in risk assessment; and 18 projects ($10.6 
million) in food handling, distribution and storage.
    In fiscal year 2000, ARS plans to undertake $11,720,000 in 
additional food safety research to expand work on the following: 
detection of foodborne pathogens ($700,000); prevention and control of 
pathogens ($4,750,000); antimicrobial/antibiotic resistance 
($3,420,000); risk assessment ($2,400,000); and food handling, 
distribution and storage ($450,000).
    A listing of the fiscal year 1999 projects is provided for the 
record.
    [The information follows:]

------------------------------------------------------------------------
                                                             Fiscal year
          Research title                   Location          1999 funds
------------------------------------------------------------------------
 Detection of Foodborne Pathogens
 
Food Safety Pathogen Reduction...  Headquarters...........      $110,000
Agriculture vs Natural Habitats    Beltsville, MD.........        42,100
 as Sources of Cryptosporidium
 Parvum.
Epidemiology and Control of        Beltsville, MD.........       353,400
 Toxoplasma, Trichinella and
 Related Parasites.
Prevention and Therapy for         Beltsville, MD.........       245,700
 Protozoan Parasites.
New Technologies to Improve and    Beltsville, MD.........       344,700
 Assess Meat Quality and Safety.
Develop Detection Methods for      Beltsville, MD.........       296,400
 Cryptosporidium.
Methods of Analysis for Residues   Beltsville, MD.........       310,300
 in Meat and Agric. Products.
New Handling Systems and Pathogen  Beltsville, MD.........        59,300
 Decontamination Technology for
 Fruits.
New Handling Systems and Pathogen  Beltsville, MD.........        59,300
 Decontamination Technology for
 Fruits.
Detection of Pathogenic Bacteria   Wyndmoor, PA...........     1,141,000
 by Biosensors.
Advanced Technologies for the      Wyndmoor, PA...........     1,093,600
 Analysis of Contaminants in
 Foods.
Rapid Pathogen Diagnostic and      Wyndmoor, PA/Purdue           541,900
 Detection Methods.                 University.
Stress Adaptation and Virulence    Wyndmoor, PA...........       328,300
 Expression of Pathogens in Food.
Food Safety Engineering Univ. Of   Wyndmoor, PA...........       988,000
 Purdue: Biosensor Technology.
Microbial Germplasm Collection     Peoria, IL.............       378,800
 for Agricultural and Industrial
 Uses.
Supercritical Fluid Techniques     Peoria, IL.............       434,100
 for Food Safety and Nutrient
 Analy-  sis.
Detection, Identification, and     Peoria, IL.............       826,100
 Surveillance of Mycotoxins in Ce-
   reals.
Prevention of Loss from            Ames, IA...............       284,300
 Colibacillosis/E. coli O157:H7
 in Cattle and Swine.
Prevention in Livestock of         Ames, IA...............       487,000
 Potential Human Foodborne
 Pathogens.
Treatment/Handling of Animal       Riverside, CA..........       148,200
 Manure to Prevent Pathogen
 Transmission.
Control of Pathogens on Surfaces   Albany, CA.............       478,100
 of Poultry and of Fruits and
 Vegetables.
Adhesion of Human Pathogens to     Albany, CA.............       538,500
 Surfaces of Poultry, Fruits and
 Vegetables.
Removal of Aflatoxin               Albany, CA.............       215,000
 Contamination from Human Foods
 in Real-Time by Imaging
 Techniques.
Treatment of Animal Manure to      Albany, CA.............       148,200
 Prevent Pathogen Transmission.
Pinus and Gutierrezia Species:     .......................        53,700
 Toxicoses and Abortion in Live-
 stock.
Astragalus and Oxytropis           Logan, UT..............        63,600
 Poisoning in Livestock.
Livestock Poisoning by             Logan, UT..............        43,800
 Pyrrolizidine Alkaloids and
 Other Hepatotoxic and
 Teratogenic Plants.
Poisoning of Livestock by          Logan, UT..............        53,700
 Larkspur (Delphinium) Species.
On-Line Verification and           Clay Center, NE........       436,500
 Intervention Procedures for
 HACCP in Slaughter/Processing
 Systems.
Control of Salmonella and E. coli  Clay Center, NE........       783,400
 0157:H7 in Livestock/Preharvest.
Prevent the Occurrence of Toxins   Fargo, ND..............       296,400
 in Water/Protect Food and
 Environment.
Methodology Development for Rapid  College Station, TX....       797,000
 Analysis of Drug and Pesticide
 Residues in Food Animal Products.
Mississippi Center for Food        Mississippi ST, MS.....       358,700
 Safety and Postharvest
 Technology.
Determine Isoflavonoid Induction   New Orleans, LA........       206,200
 in Legumes and Their
 Phytoestrogenic Effects in
 Animal Systems.
Post-Mortem Muscle/Meat Changes    Athens, GA.............       414,100
 That Affect Product Safety and
 Quality.
Reduction of Fusarium Mycotoxins   Athens, GA.............       166,500
 in Agricultural Commodities.
Rapid Pathogen Diagnostic and      Athens, GA.............       245,500
 Detection Methods.
Reduction of Biofilms Related to   Athens, GA.............       297,600
 Bacterial Contamination and
 Pathogen Load During Poultry
 Processing.
Prevent Pathogen Transmission in   Athens, GA.............        74,100
 Animal Manure.
Treatment of Poultry Manure to     Athens, GA.............        74,100
 Prevent Pathogen Transmission.
                                                           -------------
      TOTAL......................  .......................    14,217,200
                                                           =============
    Prevention and Control of
            Pathogens
 
Preharvest Control of Aflatoxin..  Headquarters...........       861,200
Food Safety Pathogen Reduction...  Headquarters...........       105,700
Assessment of Agricultural vs      Beltsville, MD.........       168,500
 Natural Habitats as Sources of
 C. Parvum.
Epidemiology and Control of        Beltsville, MD.........       342,700
 Toxoplasma, Trichinella and
 Related Parasites.
Strategies to Control Swine        Beltsville, MD.........       766,600
 Parasites Affecting Food Safety.
Prevention and Therapy for         Beltsville, MD.........       245,600
 Protozoan Parasites.
Animal Waste Handling Systems to   Beltsville, MD.........       592,800
 Prevent Pathogen Transmis-  sion.
Fate and Environmental Impact of   Beltsville, MD.........       350,800
 Agricultural Nutrients in
 Sustainable Production Systems.
The Effect of Plant Genetics and   Beltsville, MD.........       218,200
 Zinc on Cadmium Concentration
 and Bioavailability in Crops.
Composting, Stabilization, and     Beltsville, MD.........       790,800
 Safe Use of Manure and Mineral
 By-Products from Rural/Urban
 Areas.
Integrated Soil-Nutrient-Crop-     Beltsville, MD.........       240,600
 Microbial-Pest-Waste Management
 Strategies for Sustainable
 Agriculture.
Development of Techniques for      Beltsville, MD.........     1,001,800
 Inspection of Poultry Carcasses.
New Handling Systems and Pathogen  Beltsville, MD.........       177,800
 Decontamination Technology for
 Fruits.
Quality Maintenance and Food       Beltsville, MD.........       545,200
 Safety of Fresh and Fresh Fruits/
 Vegetables.
Agricultural Approaches to Human   Ithaca, NY.............       166,500
 Health Through Understanding
 Soil-Plant-Human/Animal Food
 Systems.
Improving the Nutritional Quality  Ithaca, NY.............       149,700
 and Stress Tolerance of Food
 Crop Species.
Interventions to Improve the       Wyndmoor, PA...........       776,000
 Microbiological Safety and
 Quality of Fruits and Vegetables.
Pathogen Contamination in Food     West Lafayette, IN.....       296,400
 Producing Swine.
Molecular Approach to Understand/  Peoria, IL.............       852,800
 Control Fusarium Infection and
 Mycotoxin Contamination of Crops.
Strategies for Developing Maize    Peoria, IL.............       222,700
 Kernels Resistant to Invasion by
 Fusarium.
Control of Fusarium Mycotoxins     Peoria, IL.............     1,201,100
 and Diseases in Corn and Small
 Grains 984,000 Peoria, IL
 Integrated Control of
 Aspergillus Flavus and Aflatoxin
 in the Midwest Corn Belt.
Control and Prevention of          Ames, IA...............       415,700
 Cryptosporidium Parvum Infection.
Rumen Microbes and Their           Ames, IA...............       475,800
 Interactions with Secondary
 Plant Metabolites.
Prevention of Losses from          Ames, IA...............       710,800
 Colibacillosis and E. coli
 O157:H7 in Cattle/Swine.
Epidemiology and Control of        Ames, IA...............       657,200
 Salmonella.
Prevent Zoonotic Pathogen          Ames, IA...............       592,800
 Transmission in Swine.
Prevent Pathogen Contamination in  Ames, IA...............       296,400
 Food Producing Animals, Swine.
Treatment/Handling of Animal       Riverside, CA..........       444,600
 Manure to Prevent Pathogen
 Transmission.
Practical Application of           Albany, CA.............       327,700
 Molecular Genetics for Improved
 Potato Cultivars.
Reduction of Aflatoxin in Tree     Albany, CA.............       946,900
 Nuts and Figs Through Control of
 Major Insect Vectors.
Control and Prevention of          Albany, CA.............       750,100
 Aflatoxin Formation in Tree Nuts.
Control of Pathogens on Surfaces   Albany, CA.............       697,200
 of Poultry and of Fruits/
 Vegetables.
Adhesion of Human Pathogens to     Albany, CA.............       517,000
 Surfaces of Poultry Fruits/
 Vegetables.
Treatment of Animal Manure to      Albany, CA.............       444,600
 Prevent Pathogen Transmission.
Pinus and Gutierrezia Species:     Logan, UT..............       483,100
 Toxicoses and Abortion in Live-
 stock.
Astragalus and Oxytropis           Logan, UT..............       572,100
 Poisoning in Livestock.
Livestock Poisoning by             Logan, UT..............       394,200
 Pyrrolizidine Alkaloids and
 Other Hepatotoxic and
 Teratogenic Plants.
Poisoning of Livestock by          Logan, UT..............       483,100
 Larkspur (Delphinium) Species.
Control of Salmonella and E. coli  Clay Center, NE........     1,081,900
 0157:H7 in Livestock During
 Preharvest.
Determine the Correlation Between  Clay Center, NE........       296,400
 Production and Transportation
 Practices in Cattle.
Cytokine-Mediated Modulation of    College Station, TX....       539,500
 the Innate Immune Response to
 Prevent Salmonellosis in Poultry.
Development of Microbial CEC       College Station, TX....     1,249,900
 Methods to Reduce Pathogens in
 Swine.
Prevention and Control of          College Station, TX....     1,189,400
 Salmonella and Other
 Enteropathogens in Poultry
 During Growout.
Prevent Pathogen Contamination in  Lubbock, TX............       281,600
 Food Producing Animals, Cat-
 tle.
Disease Related Problems of        Fayetteville, AR.......       293,800
 Poultry Production and
 Processing.
Enhancing Biotic Pest Resistance   Mississippi ST, MS.....       669,100
 in Corn Germplasm.
Aflatoxin Control Through          New Orleans, LA........     1,019,900
 Targeting Gene Cluster Governing
 Aflatoxin Synthesis in Corn and
 Cottonseed.
Modification of Fungal Community   New Orleans, LA........       488,600
 Structure to Improve Food Safe-
 ty.
Aflatoxin Control Through          New Orleans, LA........     1,324,200
 Addition of Enhancement of
 Antifungal Genes in Corn and
 Cotton.
Development of Improved Peanut     Tifton, GA.............       267,700
 Germplasm with Resistance to
 Disease and Nematode Pests.
Genetic Improvement of Corn and    Tifton, GA.............       151,700
 Sorghum for Resistance to
 Insects and Aflatoxin.
Plant Resistance and Germplasm     Tifton, GA.............       145,000
 Enhancement for Managing Insect
 Pests of Southern Crops.
Biochemical, Physical,             Dawson, GA.............       745,600
 Microbiological Management for
 Prevention of Mycotoxin in
 Peanuts.
Pathogenesis, Detection, and       Athens, GA.............     1,025,400
 Control of S. Enteritidis and
 Other Salmonellae in Chickens.
Stimulation of Mucosal Immunity    Athens, GA.............       371,200
 in Chickens to Protect Against
 Enteric and Respiratory
 Pathogens.
Engineering Innovations and Micro  Athens, GA.............       537,500
 Developments to Reduce
 Contamination of Poultry and
 Equipment.
Control of Campylobacter Jejuni    Athens, GA.............     1,117,400
 in Poultry.
Control of Salmonella During       Athens, GA.............       844,400
 Poultry Production.
Reduction of Fusarium Mycotoxins   Athens, GA.............       666,000
 as Concerns in Agricultural
 Commodities.
Control and Prevention of          Athens, GA.............     1,032,300
 Mycotoxin Formation by the Corn
 Endophyte Fusarium Moniliforme.
Epidemiology and Ecology of S.     Athens, GA.............       327,400
 Enteritidis in Commercial
 Poultry Flocks.
Food Safety-Pathogen Reduction in  Athens, GA.............       237,000
 Poultry.
Prevent Pathogen Transmission in   Athens, GA.............       222,300
 Animal Manure.
Treatment of Poultry Manure to     Athens, GA.............       222,300
 Prevent Pathogen Transmission.
On-Line Detection Technology:      Athens, GA/Inst. Of           439,100
 PPQRU RRRC/Institute Technology    Tech. Dev.
 Development.
Food Safety, Waste Minimization,   Raleigh, NC............       491,800
 and Value Enhancement of
 Fermented and Lightly Processed
 Vegetables.
National Agricultural Library:     Beltsville, MD.........       219,600
 Food Safety Data Base.
                                                           -------------
      TOTAL......................  .......................    37,942,600
                                                           =============
     Antimicrobial/Antibiotic
            Resistance
 
Assurance of Microbiological       Wyndmoor, PA...........       159,900
 Safety of Thermally Processed
 Foods.
Stress Adaptation and Virulence    Wyndmoor, PA...........       506,100
 Expression of Bacterial
 Pathogens in Food Environments.
Improve Safety and Shelf-Life of   Wyndmoor, PA...........       156,700
 Meat and Poultry with Ionizing
 Radiation.
Epidemiology and Control of        Ames, IA...............       295,300
 Salmonella.
Development of Microbial CEC       College Station, TX....       588,200
 Methods to Reduce Pathogens in
 Swine.
Pathogen Reduction in Poultry....  Athens, GA.............       218,800
Antibiotic Resistance Research...  Athens, GA.............       296,400
                                                           -------------
      TOTAL......................  .......................     2,221,400
                                                           =============
         Risk Assessment
 
Epidemiology and Control of        Beltsville, MD.........       374,800
 Toxoplasma, Trichinella in
 Domestic Animals.
New Technologies to Improve and    Beltsville, MD.........       344,700
 Assess Meat Quality and Safety.
Minimally Degradative              Wyndmoor, PA...........       302,900
 Pasteurization Processes for
 Liquid or Solid Foods.
Assurance of Microbiological       Wyndmoor, PA...........       399,900
 Safety of Thermally Processed
 Foods.
Risk Modeling to Improve the       Wyndmoor, PA...........       120,700
 Microbiological Safety of
 Poultry Products.
Microbial Modeling Components for  Wyndmoor, PA...........     1,209,600
 Use in Risk Assessments.
Improve Safety and Shelf-Life of   Wyndmoor, PA...........       156,700
 Meat and Poultry by Irradiation.
Disposition of Beta-Agonists in    Fargo, ND..............       915,300
 Farm Animals.
Dioxins and Other Environmental    Fargo, ND..............     1,084,400
 Contaminants in Foods.
                                                           -------------
      TOTAL......................  .......................     4,909,000
                                                           =============
 Food Handling, Distribution and
             Storage
 
Develop New Handling Systems and   Beltsville, MD.........        59,300
 Pathogen Decontamination
 Technology for Fruits.
Develop New Handling Systems and   Beltsville, MD.........        59,300
 Pathogen Decontamination
 Technology for Fruits.
Interventions to Improve the       Wyndmoor, PA...........       987,600
 Microbiological Safety and
 Quality of Fruits and Vegetables.
Development of Minimally           Wyndmoor, PA...........       959,200
 Degradative Pasteurization
 Processes for Liquid or Solid
 Foods.
Detection of Pathogenic Bacteria   Wyndmoor, PA...........       303,300
 by Biosensors.
Assurance of Microbiological       Wyndmoor, PA...........       239,900
 Safety of Thermally Processed
 Foods.
Risk Modeling to Improve the       Wyndmoor, PA...........       120,700
 Microbiological Safety of
 Poultry Products.
Stress Adaptation and Virulence    Wyndmoor, PA...........       533,400
 Expression of Pathogens in Food.
Improve Safety and Shelf-Life of   Wyndmoor, PA...........     1,253,800
 Meat/Poultry with Ionizing
 Radiation.
Quantitative Determination of      Wyndmoor, PA...........       966,700
 Pathogen Reduction During Animal
 Slaughter and Food Processing.
Control of Pathogens on Surfaces   Albany, CA.............       816,700
 of Poultry and Fruits and
 Vegetables.
Adhesion of Human Pathogens to     Albany, CA.............     1,098,600
 Surfaces of Poultry and Fruits/
 Vegetables.
Adv. Technologies for Reduction    Albany, CA.............       541,300
 of Microorganisms and
 Particulate Matter in Food
 Processing.
Removal of Aflatoxin               Albany, CA.............       215,000
 Contamination from Human Foods
 in Real Time by Imaging
 Techniques.
Control of Pathogenic and          Clay Center, NE........       844,400
 Spoilage Bacteria on Red Meat.
Develop On-Line Verification and   Clay Center, NE........       436,500
 Intervention Procedures for
 HACCP in Slaughter/Processing
 Systems.
Engineering Innovations and Micro  Athens, GA.............       537,500
 Developments to Reduce
 Contamination of Poultry and
 Equipment.
Reduction of Biofilms Related to   Athens, GA.............       604,200
 Bacterial Contamination and
 Pathogen Load During Poultry
 Processing.
                                                           -------------
      TOTAL......................  .......................    10,577,400
                                                           =============
      TOTAL FOOD SAFETY..........  .......................    69,867,600
------------------------------------------------------------------------

    A listing of the proposed fiscal year 2000 projects is provided for 
the record.
    [The information follows:]
                               preharvest
Manure handling and distribution ($2,500,000)
  --Ames, IA, $400,000--pathogen reduction
  --Miss. State, MS, $600,000--pathogen reduction
  --Clay Center, NE, $300,000--pathogen reduction
  --Lincoln, NE, $300,000--pathogen reduction
  --Bushland, TX, $600,000--pathogen reduction
  --Phoenix, AZ, $300,000--identify pathogens associated with water
Risk assessment ($2,400,000)
  --Athens, GA, $600,000--poultry contamination
  --West Lafayette, IN, $600,000--swine production practices
  --Clay Center, NE, $600,000--microbiological models in cattle
  --Beltsville, MD, $600,000--zoonotic parasites
Antibiotic resistance ($1,800,000)
  --Athens, GA, $600,000--gene resistance for poultry
  --Ames, IA, $600,000--gene resistance for cattle and swine
  --College Station,TX, $600,000--antibiotics for organisms in food 
        animals
Fungal toxins ($300,000)
  --Athens, GA, $300,000--prevention of endophytic fungi in corn and 
        grasses
Zoonotic disease risk ($300,000)
  --Fayetteville, AR, $300,000--metabolic diseases in chickens and 
        turkeys
                              postharvest
Pathogen control during slaughter/processing ($700,000)
  --Athens, GA, $700,000--on-line detection of unwholesome poultry
Pathogen control in fruits/vegetables ($2,100,000)
  --Beltsville, MD, $600,000--ecology of foodborne pathogens, 
        development of handling procedures
  --Wyndmoor, PA, $900,000--intervention strategies for pathogens on 
        vegetables
  --Albany, CA, $600,000--growth and survival of pathogens inbiofilms
Antimicrobial resistance ($1,620,000)
  --Wyndmoor, PA, $900,000--molecular characterization methods
  --Peoria, IL, $720,000--culture collections of fungal pathogens

    Question. Please indicate how ARS' food safety research agenda for 
each of fiscal years 1998 and 1999 was tailored to meet the needs of 
the participant agencies in the President's Food Safety Initiative. 
What process was used to determine research needs and priorities?
    Answer. The following process was used to tailor the ARS' food 
safety research agenda for each of fiscal years 1998 and 1999 to meet 
the needs of the participant agencies in the President's Food Safety 
Initiative, and to determine research needs and priorities:
    There was continual dialogue between the agencies conducting food 
safety research via meetings between the Chief Scientist at the Center 
for Food Safety and Applied Nutrition and his staff at the Food and 
Drug Administration, the Deputy Administrator for Public Health and 
Science and her staff of the Food Safety Inspection Service, and ARS 
Food Safety National Program Leaders. The ARS and the FSIS hold a joint 
Program Planning Workshop each year where research progress is reviewed 
and additional research needs are discussed. Representatives from the 
FDA are invited to participate in the workshop, and are often requested 
to review specific programs of research. In addition, there was a 
comparison of research agendas from each of the agencies conducting 
food safety research, that is ARS, CSREES and FDA, and a delineation of 
activities in order to eliminate any duplication of effort. These 
activities were formalized through an inventory of all food safety 
research performed by USDA and DHHS. This document is under preparation 
for the Office of the Under Secretary of Research, Education and 
Economics. There is continual interaction between agencies on projects 
or issues of national importance when required.
                     alternatives to methyl bromide
    Question. Please give us an update on the status of the agency's 
research efforts to find alternatives to the use of methyl bromide.
    Answer. ARS continues to conduct an aggressive research program to 
identify and develop effective, practical and cost effective 
alternatives to methyl bromide for use by U.S. farmers, postharvest 
commodity handlers and processors, exporters, and others impacted by 
the 2005 ban.
    The ARS methyl bromide alternatives research program encompasses a 
wide range of approaches. For soil fumigation they include: alternative 
chemicals, new technology for pesticide application, resistant plant 
varieties, biological control, and cultural practices such as soil 
amendments. For postharvest they include: new chemicals, heat and cold 
treatments, controlled atmospheres, inert dusts, radiation, systems 
approaches and combinations of these.
    Research to develop alternatives to methyl bromide to control pests 
of stored commodities produced in the western United States is 
conducted at ARS laboratories in Fresno, California, and Yakima, 
Washington. Commodities being studied include nectarines, cherries, 
apples, raisins and other dried fruits, citrus, tree nuts, cotton, and 
hay. Also, methyl bromide is currently used to control pests of many of 
these crops during storage. Many of these commodities cannot currently 
be exported without methyl bromide treatment to eliminate quarantine 
pests. Research approaches include alternative fumigants, heat and 
cold, modified atmospheres, and combinations of treatments.
    At Weslaco, Texas, and at Orlando and Miami, Florida, ARS is 
developing alternative quarantine treatments for citrus, vegetables, 
and subtropical fruits, as well as studying ways to minimize phytotoxic 
effects of these treatments. Emphasis is placed on pest-free zones, 
irradiation, heat and cold treatments, and advanced quarantine pest 
detection systems.
    At the Hilo/Honolulu, Hawaii, ARS laboratory, alternatives are 
being developed for tropical fruit infested with fruit flies, 
especially Mediterranean and oriental fruit flies, to allow export of 
Hawaii-grown fruit to foreign markets and mainland United States, and 
to protect mainland United States from introduction of pests present in 
Hawaii. This research focuses on irradiation, heat and cold commodity 
treatments and on techniques to eradicate fruit flies.
    At Manhattan, Kansas, ARS is developing alternatives to use of 
methyl bromide to fumigate flour mills, food processing plants, and 
other structures for insect infestations. Building heat-ups alone and 
in combination with other treatments such as diatomaceous earth are the 
approaches being researched.
    Research to develop alternatives to soil fumigation with methyl 
bromide to control pathogens and weeds is conducted at 15 ARS 
locations. Methyl bromide is used to some extent on more than 100 
crops, although nearly 80 percent of all the preplant methyl bromide 
soil fumigation is used on just four crops--strawberries, tomatoes, 
ornamentals/nursery crops, and peppers. Alternatives to methyl bromide 
soil fumigation include host plant resistance, biological control, 
alternative chemicals, and different cultural practices, either alone 
or in combination.
    At Washington, D.C., biological control and alternative, naturally-
occurring chemicals are being evaluated as alternatives to methyl 
bromide for control of soilborne diseases of ornamentals.
    At Beltsville, Maryland, biological control agents are being 
identified and their mode of action determined to improve control of 
diseases of vegetables.
    At Kearneysville, West Virginia, natural plant volatiles are being 
evaluated as alternative fumigants and compost and other cultural 
methods identified for disease and weed control.
    At Fresno, California, integrated strategies are being tested that 
involve host plant resistance, biological control and alternative 
chemicals for control of disease, nematodes and insects of 
strawberries, grapes, tree fruits, and vegetables. The application of 
alternative chemicals using irrigation systems is being tested.
    At Riverside, California, research is under way to reduce methyl 
bromide emission in strawberry and vegetable production and to track 
the movement and degradation of methyl bromide and alternative 
fumigants.
    At Davis, California, work is directed at using host plant 
resistance and cultural modifications to manage diseases in tree fruits 
and nuts.
    At Salinas, California, research is aimed at finding biological and 
cultural control methods to manage strawberry and vegetable diseases, 
and to characterize the ecology of soilborne pathogens.
    At Wenatchee, Washington, disease problems in tree fruit production 
are being identified, and strategies for their control are being 
sought.
    At Corvallis, Oregon, biological controls are being investigated 
for diseases of ornamentals and nursery crops, and the role of 
beneficial microorganisms in disease and weed management is being 
explored.
    At Stoneville, Mississippi, biological control agents to control 
weeds in vegetables are being identified and characterized.
    At Tifton, Georgia, the emphasis is on finding cultural methods and 
alternative chemical treatments and integrated strategies for control 
of nematodes and diseases on vegetables, and on identifying alternative 
herbicides for control of weeds.
    At Byron, Georgia, research is aimed at improving cultural 
practices and host resistance to manage nematodes and diseases in 
peaches and other tree fruits.
    At Gainesville, Florida, work is under way to find alternative soil 
treatments, such as solarization, flooding, or heating, to control 
pests, weeds, and pathogens in vegetables.
    At Orlando, Florida, integrated methods involving biological 
control, cultural practices, and alternative chemicals are being 
developed for control of weeds, nematodes and diseases in tomatoes, 
peppers, and other vegetables.
    At Charleston, South Carolina, alternative fumigants, host-plant 
resistance, and cultural practices are being explored as alternative 
disease management strategies in vegetables and fruits. The survival 
and spread of soilborne pathogens as influenced by other microorganisms 
and the environment is being determined.
    In addition, field-scale validation projects that were begun in 
fiscal year 1996 were continued in Fresno, California, and Orlando, 
Florida, to determine if the most promising experimental alternatives 
were effective, economically feasible, and adaptable to commercial 
production systems of strawberries, vegetables and perennial crops.
    ARS conducted a review of the Florida methyl bromide alternatives 
research program in December 1998. Participants included growers and 
other commodity representatives and university and ARS scientists. The 
objective of that meeting was to get grower input on research needs. A 
major outcome of that meeting was a refocusing of the ARS research 
effort in Florida to include more research on pesticides such as Telone 
as methyl bromide alternatives. A similar meeting is planned for 
California in April 1999 to get input from growers and others impacted 
by the loss of methyl bromide.
    Question. How much is included in the fiscal year 2000 request for 
this work and where will this research be conducted?
    Answer. Resources and locations for each of fiscal years 1998, 
1999, and 2000 for methyl bromide research is provided for the record.
    [The information follows:]

----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                            Location                              1998 estimated  1999 estimated  2000 estimated
----------------------------------------------------------------------------------------------------------------
Davis, CA.......................................................        $228,800        $226,000        $226,000
Fresno, CA......................................................       3,542,400       3,485,400       3,485,400
Riverside, CA...................................................         128,200         126,600         126,600
Salinas, CA.....................................................         542,500         535,900         535,900
Washington, DC..................................................         244,100         241,200         241,200
Gainesville, FL.................................................         215,600         213,000         213,000
Miami, FL.......................................................       1,234,300       1,219,300       1,219,300
Orlando, FL.....................................................       1,616,800       1,597,100       1,597,100
Byron, GA.......................................................         984,900          83,900          83,900
Tifton, GA......................................................         467,800         462,200         462,200
Hilo, HI........................................................       1,705,500       1,684,700       1,684,700
Manhattan, KS...................................................          71,700          70,800          70,800
Beltsville, MD..................................................       1,061,100       1,048,200       1,048,200
Stoneville, MS..................................................         184,500         182,200         182,200
Corvallis, OR...................................................         493,900         487,400         487,400
Charleston, SC..................................................         334,600         330,600         330,600
Weslaco, TX.....................................................       1,501,100       1,482,900       1,482,900
Wenatchee, WA...................................................         211,800         209,200         209,200
Yakima, WA......................................................         261,200         258,000         258,000
Kearneysville, WV...............................................         440,400         435,000         435,000
                                                                 -----------------------------------------------
      TOTAL.....................................................      14,571,200      14,379,600      14,379,600
----------------------------------------------------------------------------------------------------------------

    Question. Are the agency's research findings being transferred to 
producers and others?
    Answer. To demonstrate promising methyl bromide alternatives and 
provide opportunity for grower involvement of alternatives testing, ARS 
conducts numerous tests collaboratively with growers in grower fields. 
In addition, ARS provides approximately $500,000 each year from base 
funds to university scientists, primarily in California and Florida, to 
fund demonstration projects of the most promising methyl bromide 
alternatives in grower fields. The USDA co-sponsors the International 
Methyl Bromide Alternatives Research Conference each year where 
scientists, extension agents, growers, exporters and other members of 
the impacted agricultural community discuss the latest methyl bromide 
alternatives technology. In addition, ARS scientists work closely with 
grower organizations and key farmers to ensure that technology is 
transferred in a timely manner.
    For example, in California, ARS has methyl bromide alternative 
experiments on six commercial growers' land, covering the north to 
south (Watsonville to Oxnard) strawberry growing regions, both to 
validate the feasibility of possible alternative fumigants and to allow 
the growers input and experience in using them in commercial settings. 
The growers work collaboratively with ARS scientists and do the land 
preparation, planting, and harvesting themselves. ARS then uses grower 
observations and field data in planning subsequent trials. Similar 
validations have been conducted in Florida on tomatoes and peppers on 
six to eight locations from the northern part of the state (Quincy) to 
the southern (Homestead).
                       environmental initiatives
    Question. Increased funding is proposed for fiscal year 2000 for 
ARS on sustainable ecosystems and air quality. Please describe the 
agency's current research programs in each of these areas; what has 
been accomplished to date; and the level of resources, both in terms of 
dollars and scientists, allocated to these programs.
    Answer. Sustainable Ecosystems.--The proposed funding increase on 
sustainable ecosystems is in direct response to the National Science 
and Technology Council, Committee on Environment and Natural Resources 
(CENR), Integrated Science for Ecological Challenges (ISEC) Initiative. 
ISEC was initiated by the CENR member agencies in 1998, and a detailed 
strategic plan has been completed where key actions have been proposed 
for natural resource and environmental challenges in fiscal year 2000 
and beyond. The seven areas included in sustainable ecosystems and ARS 
involvement are as follows:
  --Implement the CENR Research and Monitoring Framework.--ARS is 
        currently involved in the implementation of the CENR Mid-
        Atlantic Pilot, which is an interagency effort that will lead 
        to improved monitoring and understanding for water quality and 
        environmental issues in the Delaware River Basin and the 
        Chesapeake Bay. The Mid-Atlantic Pilot has been used to 
        establish environmental data comparability as Federal agencies 
        increase collaboration; and ARS proposes to expand research and 
        monitoring for the South Florida Ecosystem Restoration 
        Initiative in fiscal year 2000. ARS currently provides 
        $4,848,100 in funding and 15 SYs that are contributing towards 
        Mid- Atlantic Pilot.
  --Prevent and Control Eutrophication, Harmful Algal Blooms, and 
        Hypoxia.--ARS became involved in eutrophication, harmful algal 
        blooms, and hypoxia research with a funding increase in fiscal 
        year 1999 for Pfiesteria research. The Pfiesteria research has 
        begun to determine the effects of harmful algal blooms in 
        aquaculture and preliminary results show that land-based 
        agricultural management practices can protect water quality and 
        prevent future outbreaks. ARS has $801,600 and 2 SYs currently 
        for Pfiesteria research. In terms of hypoxia research, ARS 
        currently has no funding that will provide direct solutions at 
        the farm and watershed-scale to the problem of increased 
        nutrient loadings into the Gulf of Mexico.
  --Predict Impacts and Restore the Viability of Damaged Riparian Zones 
        and Coastal Habitats.--ARS has been the primary agency involved 
        in determining the effectiveness of conservation buffers for 
        the removal of nutrients, pesticides and other pollutants. The 
        Clean Water Action Plan calls for farmers to create two million 
        miles of biofilters adjacent to waterways by year 2002, 
        construct 100,000 acres of wetlands by 2005 and restore 25,000 
        miles of stream corridors by 2005 without knowing the 
        capabilities of these practices in agricultural areas 
        throughout the United States. ARS has shown that conservation 
        buffers can remove sediments and contaminants generated by 
        agricultural activities before they reach surface waters, but 
        limited data are available on the long-term effectiveness of 
        conservation buffers for the removal of nutrients, pesticides, 
        pathogens, and other pollutants. ARS has $1,558,800 and 6 SYs 
        involved in wetlands and conservation buffers research.
  --Predict Ecological Impacts of Extreme Natural Events. ARS currently 
        conducts weather and climate research at several locations.--
        The major thrust of this research is to obtain more reliable 
        information on the spatial and temporal distributions of 
        precipitation and temperature for several major physiographic 
        regions of the country. ARS has developed weather generators 
        that can assist food and fiber producers and resource managers 
        in developing strategies for coping with weather variability 
        and climatic extremes. The funds requested in the budget for 
        fiscal year 2000 will be used to improve our current ability to 
        predict the ecological impacts of extreme climatic events 
        through the development of new and improved techniques for 
        determining trends in climate and the impacts of oceanic 
        anomalies, such as the El Nino, on the frequency and severity 
        of extreme climatic events, such as floods and droughts, at 
        watershed and river basin scales. ARS has funding of 
        $14,876,800 and 54 SYs involved in weather and climate 
        research.
  --Advance Ecological Science for Sustainable Livestock Management 
        Systems.--ARS has recently refocused its manure and byproduct 
        research to reduce nutrient enrichment of soil and water, to 
        decrease release of odor causing compounds and greenhouse gases 
        to the atmosphere, and control pathogens in manure for public 
        and animal health. The current research has resulted in 
        information and findings on the extent of manure problems and 
        new methods for manure handling, storage, and treatment. 
        Additional research is being conducted to protect surface 
        waters from build up of excess phosphorous in soils, and future 
        research is planned on reducing pathogens from animal feeding 
        operations. ARS has funding of $7,195,400 and 21 SYs involved 
        in manure and byproduct utilization research.
  --Conduct Integrated Ecosystem Risk Assessments.--ARS currently 
        conducts research on understanding the mechanisms by which 
        agricultural operations affect natural resources, on control 
        measures to ameliorate these impacts, and develops models and 
        decision support systems for comparing different crop and 
        livestock management systems in terms of effects on natural 
        resources. ARS has developed models for predicting soil 
        erosion, water quality impacts at the farm- and watershed-
        scales, and crop and livestock response based on different 
        levels of inputs. However, action and regulatory agencies are 
        currently being required to conduct risk assessments before and 
        after conservation management practices are placed on the land. 
        ARS has funding of $850,100 and 3 SYs involved in the 
        development of integrated natural resource, crop, and livestock 
        models.
  --Prevent and Control Invasive Weed Species for Ecosystem 
        Management.--ARS has an extensive weed research program that 
        addresses conventional weed problems on natural areas, 
        waterways, croplands, rangelands, and pasture lands; and ARS is 
        currently conducting some research on a number of invasive weed 
        species, including the control of invasive weed species such as 
        melaleuca, leafy spurge, salt cedar, and yellow starthistle. 
        ARS has shown that integrated pest management (IPM) systems 
        that include biological control, cultivation, other cultural 
        approaches, and appropriate herbicide management practices can 
        be used to prevent and control weed species; however, 
        prevention and control of invasive weed species is needed for 
        many agricultural ecosystems. ARS currently provides 
        $10,137,300 in funding and 34 SYs for invasive weed species 
        research.
    Air Quality.--The Agricultural Research Service conducts air 
quality research on issues associated with agricultural emissions of 
particulate matter (as dusts or as such volatilized particulate 
precursors as ammonia and pesticides) and odors. Research goals are to 
understand the physics and chemistry of these emissions, to develop 
approaches to reducing emissions, and to develop simulation models to 
use in evaluating alternative emission-reduction strategies. Research 
is also conducted regarding physiological mechanisms of ozone damage to 
crops and the development of measures to reduce crop damage by ozone. 
The Agency has developed a technique for analyzing dust particles to 
determine sources of origin, the level of differentiation being 
sufficient at this time to distinguish between roads, crop lands, and 
rangelands. A computer-based predictive model for particulate matter 
(PM-10) has been developed for the Columbia Plateau region of 
Washington. Co-composting of dairy manure with municipal refuse compost 
reduced volatile loss of nitrogen by 90 percent compared with 
composting dairy manure alone. The Agency has provided some of the 
first evidence that plants' antioxidants (like ascorbic acid or vitamin 
C) help protect them from the oxidative damage caused by ozone. The 
Agency played a significant role in research and reporting that led to 
publication of ``Farming with the Wind--Best Management Practices for 
Controlling Wind Erosion and Air Quality on Columbia Plateau 
Croplands''. The Agricultural Research Service currently allocates $4.9 
million and 18 scientist years to the air quality research initiative, 
not counting the odors research. The latter, which is currently carried 
out at the $1.3 million level with 5 scientist years, is reported under 
an animal wastes research initiative.
                       environmental initiatives
    Question. The fiscal year 2000 budget proposes increased ARS 
funding for the Administration's global change initiative. Please 
describe the agency's current research effort in this area, what is 
being accomplished, and the importance of this research to agriculture 
in the United States.
    Answer. For the past several years, ARS's global change research 
has focused on determining the likely effects of global change on: (1) 
Ecosystem dynamics, i.e. how will the increasing atmospheric 
CO2 concentration and any accompanying climate change affect 
the productivity and water requirements of agricultural crops in the 
future; (2) Biogeochemical dynamics, i.e. what are the amounts of 
greenhouse gases (carbon dioxide, methane, nitrous oxide) being emitted 
and stored by agriculture and how are these amounts likely to change in 
the future; and (3) Hydrologic processes, i.e. how to improve 
predictions of water and energy flows to, within, and from managed 
ecosystems and how they will change in the future.
    ARS research has determined the rates of storage and emission of 
carbon dioxide from soils under various tillage systems and from the 
undisturbed soils of rangelands. The emissions of methane and nitrous 
oxide from soils and livestock waste lagoons have also been measured. 
The responses of several of the most important crops, especially 
soybean, rice, cotton, and wheat, to elevated levels of carbon dioxide 
and its interactions with other environmental variables have been 
observed. Our understanding of the effects on specific plant 
physiological processes, such as photosynthesis, has been increased. 
From monitoring of experimental watersheds, long-term hydrologic, 
climatic, and vegetation databases have been developed that are useful 
for documenting change and developing an understanding of hydrologic 
processes and climatic effects on crop and livestock production.
    One accomplishment from the past year is especially noteworthy. ARS 
scientists along with colleagues from Ohio State University and from 
the Natural Resources Conservation Service published a keystone book on 
The Potential of U.S. Cropland to Sequester Carbon and Mitigate the 
Greenhouse Effect. Refinements are needed, but nevertheless, this book 
is a major accomplishment that is being used by nearly everyone in and 
outside of government who is looking for guidance on the soil carbon 
sequestration issue. The authors' calculations suggest there is a huge 
potential for sequestering carbon in soils if conservation management 
practices are adopted, practices which would additionally reduce 
erosion and improve soil tilth.
    The importance of global change, and of the research needed to 
prepare for it, is very high for agriculture. Agriculture is more 
sensitive to weather than any other economic sector, and climate is the 
primary determinant of agricultural productivity. Climate change is 
expected to influence crop and livestock production, hydrologic 
balances, and input supplies. For example, crop and livestock yields 
are directly affected by changes in temperature, precipitation, and the 
frequency of droughts, floods, and wind storms. Climate change may also 
change the types, frequencies, and intensities of various pests, the 
availability and timing of irrigation water supplies, and the severity 
of soil erosion. Trying to cope with the vagaries of weather is not new 
for agriculture. However, the increased carbon dioxide concentration in 
the atmosphere adds a new dimension to the issue because it is an 
essential plant nutrient for photosynthesis, and higher concentrations 
have the potential to actually enhance productivity of agricultural 
systems.
    Global change research in agriculture is also important for 
devising ways to mitigate the increases in greenhouse gas 
concentrations in the atmosphere. As already mentioned, with improved 
management practices on the hundreds of millions of acres of 
agricultural land, significant quantities of carbon could potentially 
be stored in soils, and methane and nitrous oxide emissions could also 
be reduced. Agriculture could potentially also provide biomass as a 
alternative to burning fossil fuels.
                         centers of excellence
    Question. Please list the Centers of Excellence receiving ARS 
funding for each of fiscal years 1998 and 1999, and the funds proposed 
for each Center in the fiscal year 2000 budget request. Please list the 
institution, the amount of funding, and describe the research program 
funded.
    Answer. The location, funding and staffing levels of the ARS 
Centers of Excellence for fiscal years 1998, 1999 and proposed for 2000 
are as follows:

----------------------------------------------------------------------------------------------------------------
                                             Fiscal year 1998        Fiscal year 1999        Fiscal year 2000
                Location                 -----------------------------------------------------------------------
                                             Funds    Scientists     Funds    Scientists     Funds    Scientists
----------------------------------------------------------------------------------------------------------------
University of Arkansas Pine Bluff, AR...     537,900        2.0     $531,400        2.0     $531,400        2.0
Delaware State University Dover, DE.....     248,500        1.0      241,400        1.0      241,400        1.0
University of Maryland Princess Anne, MD     244,400        1.0      541,900        1.0      541,900        1.0
Alcorn State University Lorman, MS......     164,700        1.0      162,700        1.0      162,700        1.0
Langston University Langston, OK........     199,000  ..........     444,600        1.0      444,600        1.0
Tennessee State University McMinnville,      488,400        2.0      482,500        2.0      482,500        2.0
 TN.....................................
                                         -----------------------------------------------------------------------
      Total.............................   1,882,900        7.0    2,404,500        8.0    2,404,500        8.0
----------------------------------------------------------------------------------------------------------------

    The research programs at each of the Centers will be provided for 
the record.
    Swine Production at Alcorn State University.--The objective of the 
program is to develop an efficient system for the production of meat 
type hogs in the Southern United States. The research includes the 
evaluation of breeds of swine suitable for production in Southern 
climates, the use of local feeds, and development of feeding systems to 
obtain efficient production of pork.
    Aquaculture Products at Delaware State University.--This program 
will develop rapid detection and monitoring methods for pathogens and 
spoilage microorganisms in aquaculture processes and products and 
improving the efficiency of purging contaminants in order to prevent 
human illnesses.
    Grazing Lands at Langston University, Oklahoma.--The objective of 
this program is to determine impact of pasture design and grazing 
animals on quality of water emerging from watersheds, and develop 
pasture management systems that will optimize water quality and 
productivity in the semi-arid U.S.
    Horticulture at Tennessee State University, McMinnville.--The 
objective of the program is to develop new and improved ornamental 
trees and shrubs for the U.S. nursery industry. The research includes 
development of basic genetic and physiological information related to 
nursery crop species; reduce pesticide use and fertilizer runoff during 
nursery crop production; develop improved nursery crop propagation 
methods; and evaluate existing germplasm or ornamental trees and shrubs 
for pest resistance, tolerance of environmental stress, and superior 
ornamental value.
    Aquaculture at University of Arkansas at Pine Bluff.--The ARS 
Aquaculture Systems Research Unit develops and evaluates new or 
alternative aquaculture production systems, particularly small scale 
systems, and develops new components of these systems to improve the 
efficiency of fresh water fish farming. Research also addresses 
improvement of cultivation and processing methods to enhance the 
quality of farm-raised fish and their products.
    Critical Control Points in Model Systems at University of Maryland 
Eastern Shore (UMES).--The program seeks to determine the natural 
prevalence of bacterial pathogens in poultry grow-out houses, 
processing plants, and in distribution channels; to conduct challenge 
studies on critical control points in model systems to provide data for 
predictive model development; and to develop risk assessment models for 
use in hazard management systems. In particular, the laboratory is 
developing risk assessment and predictive models to provide the 
scientific basis for Hazard Analysis Critical Control Point (HACCP) 
systems in poultry production, processing, and distribution. ARS 
research is conducted in close collaboration with the USDA Food Safety 
& Inspection Service (FSIS), providing critical research to support 
their regulatory mission.
                     national agricultural library
    Question. Please describe in greater detail the $2 million research 
initiative the National Agricultural Library (NAL) proposes to improve 
information services for rural America, including how information 
currently is made available by the library to farmers and rural 
communities; how this initiative will improve that information flow; 
specifically how the $2 million requested will be spent, and which 
universities and ``Centers of Excellence'' will be involved in this 
initiative.
    Answer. The increase of $2,000,000 is for an Initiative on Digital 
Libraries for Rural America. This is a natural extension of current 
services provided by the National Agricultural Library (NAL) to the 
entire U.S. population. General information services provided by NAL 
include reference, online searching, interlibrary loan, and information 
products. In addition, NAL provides leadership for the Agriculture 
Network Information Center (AgNIC), a collaborative effort of twenty-
three institutions (mostly land-grant universities) to organize and 
provide universal access to quality Internet information resources on 
agriculture and related sciences. NAL currently provides information to 
farmers and rural communities on such topics as: sustainable 
agriculture, nutrition, and rural economic development.
    NAL recognizes that there is much more information that would be 
beneficial to rural communities, but not all that information is 
available in electronic format. This initiative will improve 
information flow by developing specific electronic information 
resources of use to rural America. This new funding will enable NAL, in 
partnership with the land-grant community, to assess the information 
needs of rural citizens, ensure that needed information is made 
available, and facilitate the use of that information by rural citizens 
and others involved in rural development.
    The $2,000,000 requested will be used to improve the electronic 
delivery infrastructure available to rural communities and to add 
significant subject content. A portion of the funding will be used at 
NAL to enhance delivery infrastructure. The remainder of the funding 
will be made available to land-grant universities and other 
institutions to augment subject content, features, and services for 
rural America. NAL will establish criteria for selecting organizations 
to do that work, publicize the subject work to be done, and invite 
proposals. Funding will be provided to the institutions best able to do 
the work needed.
    It is too early to know which universities and ``Centers of 
Excellence'' will be involved in this initiative. Over the past decade, 
NAL has worked closely with a number of land-grant universities 
including, but not limited to, Cornell University, Iowa State 
University, Michigan State University, New Mexico State University, 
North Carolina State University, Pennsylvania State University, Ohio 
State University, the University of Arizona, and the University of 
Wisconsin.
    Question. The Committee is aware that the NAL serves as a 
storehouse for numerous art collections of major historical and 
botanical significance to horticulturists, historians, artists, and 
publishers from around the world. Please provide a list of the 
collections maintained by NAL and describe the importance of each 
collection. Also, how much does it cost NAL each year to maintain these 
collections, including the cost of making them accessible to historians 
and researchers around the world?
    Answer. The Special Collections Section of the National 
Agricultural Library serves as a storehouse for, and provides access 
to, numerous rare and historical collections of artistic interest, 
including 15,000 rare books and more than 300 collections of 
watercolors, posters, nursery catalogs, photographs, and historic 
papers. These collections are consulted by users from throughout the 
world who conduct subject-specific research in all fields of 
agriculture. A representative list of important collections unique to 
NAL includes the following treasures:
  --The USDA Pomological Watercolor Collection (1887-1937). This 
        collection includes hand-painted, detailed, scientifically-
        accurate watercolors of fruit and nut species and varieties. It 
        is the historical record of early research.
  --The Nursery and Seed Trade Catalog Collection (1731-1999). This is 
        one of the largest collections of nursery catalogs in the 
        world, including some of the earliest U.S. catalogs. It is the 
        historical record of the U.S. seed industry.
  --The Horace J. McFarland Collection (ca. 1900-1940). The papers of 
        this conservationist and publisher include one-of-a-kind glass 
        plates documenting the history of landscape architecture and 
        horticulture, as well as American rose introductions.
  --The Forest Service Historical Photograph Collection (1898-1974). 
        This collection includes 60,000 black and white photographs 
        documenting rural life in America, forestry practices, and 
        fire-fighting techniques.
  --The Beverly T. Galloway Papers (1891-1933). The papers of the first 
        Chief of the USDA Bureau of Plant Industry trace the history of 
        plant pathology, plant exploration, and USDA cooperation with 
        state universities.
  --The Charles Valentine Riley Papers and Memorabilia. The papers of 
        the Father of Biological Control document early USDA 
        entomological research and the beginning of biological control.
  --The Smokey Bear Campaign Collection (1902-1994). This collection 
        documents one of the most successful public awareness campaigns 
        and includes early Smokey posters, illustrations, and 
        memorabilia.
    NAL has an annual budget of approximately $70,000 to provide 
limited maintenance of and access to these materials. This level of 
funding is clearly inadequate to take proper care of the materials or 
to provide the access these collections deserve; it is not even enough 
to prevent deterioration of these items. An initial appropriation of $1 
million is needed to begin to conserve and provide permanent public 
access to rare and irreplaceable materials.
    In order to enhance NAL's ability to maintain and provide access to 
these special collections, NAL would use approximately 65 percent of 
the requested funds to provide access via the Internet and 35 percent 
of the requested funds to support initial maintenance and conservation 
activities. The seven collections described above represent NAL's top 
priorities. Funded activities would include:
    Access ($650,000):
  --Prepare materials for electronic access. Scan materials into 
        electronic form.
  --Make items available via the World Wide Web (WWW).
  --Link full-text and images to AGRICOLA, NAL's database now available 
        via the Internet.
    Collection, Maintenance, and Conservation ($350,000):
  --Rehouse materials into preservation quality media.
  --Conduct a thorough survey of collections to determine appropriate 
        conservation treatments and then to perform such activities 
        that will retard further deterioration.
  --Convert extremely fragile paper and photographic materials to 
        longer lasting media such as acid free paper, slides, etc.
  --Improve the storage environment to consistently meet national 
        standards for temperature, humidity, and security, etc. to 
        ensure their longevity.
    Funding such an integrated program will enable us to enhance NAL's 
digital library with a unique and historically significant collections 
for use by researchers, students, and the general public.
                        buildings and facilities
    Question. The explanatory notes indicate that the design of the 
Beltsville Human Nutrition Research Center is scheduled for completion 
in the second quarter of fiscal year 2000. Why are construction funds 
requested for Phase I of the facility for fiscal year 2000 rather than 
fiscal year 2001?
    Answer. The design of the Beltsville Human Nutrition Research 
Center will be completed in the second quarter of fiscal year 2000. 
Construction funds are needed for Phase 1 in fiscal year 2000 in order 
to advertise and award a construction contract by the third quarter. If 
funds are not received until fiscal year 2001, the construction process 
will be delayed and the estimated construction cost will increase due 
to inflation.
    Question. How many phases are proposed for construction of the new 
Human Nutrition Research Center? What funding is required for each 
phase of this project?
    Answer. Two phases are proposed. Phase I requires $11.4 million in 
fiscal year 2000, and Phase II requires $10.8 million in fiscal year 
2001.
    Question. The fiscal year 2000 request proposes an increase of $4.4 
million for modernization of the Eastern Regional Research Center in 
Philadelphia, PA. Will this funding be sufficient to complete the sixth 
phase of the Chemical Wing Laboratory? Please describe the nine phases 
of this project and the additional funding that will be required to 
complete this work.
    Answer. The funds required to complete the sixth phase of the 
Chemical Wing Modernization are $4.4 million.
    Phases 1 and 2 of the ERRC modernization renovates the Engineering 
Research Laboratory of the Pilot Plant and Service Buildings. The 
Chemical Wing construction consists of Phases 3 through 7. Once Phase 7 
is accomplished, the Chemical Wing renovation will be complete. Phase 8 
includes an addition to the Service Building (Power Plant) to allow for 
the higher load of steam and chilled water required for the expanded 
laboratory functions. Phase 9 consists of renovation of the Pilot Plant 
Wing Engineering Laboratories.
    An additional $13 million will be required for Phases 7, 8, and 9.
    Question. Provide the proposed schedule for modernization of each 
of the other ARS facilities for which funding is requested in the 
fiscal year 2000 budget. Include planned project phases, the funding 
provided to date, and the additional funding needed to complete the 
work scheduled.
    Answer.

Western Regional Research Center Chemical Wing

Funding to Date (Chemical Wing):
    1990--Design (R&M)..................................     $1,938,830 
    1990--Construction Phases I & II (R&M)..............      5,900,000 
    1991--Construction Phase III (R&M)..................      3,400,000 
    1993--Construction Phase IV (R&M)...................      3,000,000 
    1994--Construction Phase V (R&M)....................      4,900,000 
    1994--Construction Phase VI (R&M)...................      4,400,000 
    1994--Construction Phase VII (B&F)..................      1,161,000 
    1995--Construction Phase VII (B&F)..................        919,000 
    1997--Construction Phase VII (B&F)..................      4,000,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     29,618,830 
                    ========================================================
                    ____________________________________________________
Additional Funding Needs:
    2000--Design Research & Development Facility (RDF), 
      all phases........................................      2,600,000 
    2001--Construct RDF--all phases.....................     19,600,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     22,200,000 
                    ========================================================
                    ____________________________________________________

National Center for Agricultural Utilization Research

Funding to Date:
    1989--Study (R&M)...................................        170,000 
    1990--Phasing Study (R&M)...........................         56,000 
    1990--Design Phase I (Infrastructure Upgrade).......        330,000 
    1991--Construction Phase I (R&M)....................      2,404,000 
    1992--Design Phase II, Pilot Plant (B&F) ($1.7 
      Allocated)........................................      1,825,000 
    1993--Design Phase III Chemical Wing (B&F) 
      (Redirected to Pilot Plant).......................      1,545,000 
    1996--Construction Phase II--Segment 1 Pilot Plant 
      (B&F).............................................      3,900,000 
    1997--Construction Phase II--Segment 1 Pilot Plant 
      (B&F).............................................      1,500,000 
    1998--Modernization Phase II--Segment 2 Pilot Plant 
      (B&F).............................................      8,000,000 
    1999--Modernization Phase II--Segment 3 Pilot Plant 
      (B&F).............................................      8,200,000 
                    --------------------------------------------------------
                    ____________________________________________________
        Total...........................................     27,930,000 
                    ========================================================
                    ____________________________________________________
Additional Funding Needs:
    Funding to Date:
        2000--Design Chemical Wing--all phases..........      1,800,000 
        2002--Construct Chemical Wing--Phase 1..........      5,900,000 
        2004--Construct Chemical Wing--Phase 2..........      7,400,000 
        2006--Construct Chemical Wing--Phase 3..........      8,000,000 
        Future--Design and construct South Wing and 
          Administration Wing--All phases...............     30,900,000 
                    --------------------------------------------------------
                    ____________________________________________________
            Total.......................................     54,000,000 
                    ========================================================
                    ____________________________________________________

Southern Regional Research Center

Funding to Date (Chemical Wing):
    1990--Design (R&M)..................................        884,000 
    1991--Construct Phase I (R&M).......................      1,400,000 
    1992--Construct Phase II (R&M)......................      2,400,000 
    1992--Construct Phase III, IV (R&M).................      3,050,000 
    1992--Construct Phase V (B&F).......................      1,950,000 
    1993--Design/Construct Site Repairs (B&F)...........      1,651,000 
    1994--Construct Phase VI (B&F)......................      2,667,000 
    1995--Construct Phase VII (B&F).....................      2,934,000 
    1996--Construct Site Repairs, Phase II (B&F)........        900,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     17,836,000 
                    ========================================================
                    ____________________________________________________
Funding to Date (Industrial Wing):
    1998--Design (B&F) All phases.......................      1,100,000 
    1999--Construct Phase 1 (B&F).......................      6,000,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      7,100,000 
                    ========================================================
                    ____________________________________________________
Additional Funding Needs:
    2000--Construct Phase 2--Industrial Wing............      5,500,000 
    2003--Construct Phase 3--Industrial Wing............     14,000,000 
    2005--Construct Phase 4--Industrial Wing............      5,500,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     15,000,000 
                    ========================================================
                    ____________________________________________________

Plum Island Animal Disease Center

Funding to Date:
    1992--Design (Redirected to Consolidation)..........     (2,000,000)
    1993--Modernization.................................      2,540,000 
    1993--APHIS Transfer................................      1,183,000 
    1994--Modernization.................................      1,475,000 
    1994--APHIS Transfer................................        516,250 
    1995--Modernization.................................      1,168,000 
    1995--APHIS Transfer................................        747,000 
    1996--Modernization.................................      5,000,000 
    1996--APHIS Transfer................................      3,200,000 
    1997--Modernization.................................      5,000,000 
    1997--APHIS Transfer................................      3,200,000 
    1998--Modernization.................................      2,000,000 
    1998-- APHIS Transfer...............................      3,200,000 
    1999--Modernization.................................      3,500,000 
    1999--APHIS Transfer................................      3,200,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     35,929,250 
                    ========================================================
                    ____________________________________________________
Additional Funding Needs:
    2000--Modernization.................................      8,200,000 
    Future..............................................     45,871,000 
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     54,071,000 
                    ========================================================
                    ____________________________________________________

Beltsville Agricultural Research Center (BARC)

Funding to Date:
    Fiscal year 1988:
        Renovate Building 007...........................      2,000,000 
        Design Building 003.............................        660,859 
        Renovate Abattoir, Building 204.................         57,446 
        Renovate Building 303...........................        506,877 
        Modify HVAC, Building 306.......................        372,270 
        Water Lines.....................................      1,402,195 
        Miscellaneous Projects, BARC (under $100,000)...        374,234 
        Repair Building 307.............................         88,064 
        Repair Building 467.............................         10,835 
        Repair Building 264.............................          5,480 
        Small Animal Facility Contingency...............        271,740 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................      5,750,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1989:
        U.S. National Arboretum Roof Repairs............        300,852 
        U.S. National Arboretum Greenhouse Electrical 
          Repairs.......................................        273,200 
        Steam Lines, Phase IV...........................      1,100,000 
        Oil to Gas Conversion...........................        328,237 
        Renovate Building 203 (Boar Facility)...........        529,026 
        U.S. National Arboretum, Relocate Service Road..         87,643 
        Hazardous Waste Marshaling Facilities...........         79,662 
        Waste Water Treatment Study.....................        194,864 
        Renovate Building 204...........................        354,335 
        Beltsville Area Security........................         91,806 
        Pesticide Handling Facilities...................        441,793 
        Swing Space.....................................        274,100 
        Miscellaneous Projects..........................         44,482 
        USNA Brickyard..................................      2,000,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................      6,100,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1990:
        Steam Lines, Building 169-179...................        568,752 
        Steam Lines, Buildings 001-011A.................      1,407,084 
        Range 2 Modernization...........................        690,574 
        Waste Water Treatment Facility..................      1,100,056 
        Electrical Distribution System..................        574,157 
        BARC Roads......................................        361,027 
        Animal Parasitology Unit Planning...............         30,282 
        HVAC System, Building 050.......................         44,598 
        Repair Embankment Failure.......................        211,135 
        Powder Mill Road................................      1,547,588 
        Swing Space.....................................        103,685 
        Brooder House...................................        230,000 
        Renovate Building 043, 046, 047.................        148,591 
        Annual Painting.................................        200,098 
        Annual Roofing..................................        247,582 
        U.S. National Arboretum Storage Building........         90,402 
        U.S. National Arboretum Plastic Greenhouses (3).        235,687 
        Demolition of Facilities........................         27,985 
        Replace Chiller, Building 006...................        103,965 
        Renovate Building 209...........................         71,693 
        Renovate Headhouse 16...........................         35,124 
        Repairs Building 177B...........................         12,465 
        Repairs Building 211............................          7,965 
        Renovate Building 1120..........................         18,391 
        Elevator, Building 449/Gas Cyl..................         50,954 
        Renovate Building 449...........................          4,865 
        Key Card Security Gate..........................         37,002 
        Small Miscellaneous Projects....................        625,031 
        Repairs, Building...............................         15,000 
        Contingency Steam Lines.........................        297,170 
        Contingency.....................................        197,604 
        Replace Roof, Building 012......................        139,000 
        Contingency.....................................        424,488 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................      9,860,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1991:
        Addition, Building 426..........................         65,000 
        Conference Room, Building 005...................        435,000 
        Electrical......................................      1,500,000 
        Building 001....................................        735,000 
        Plant Sciences Building.........................      1,100,000 
        Dairy Research Facility.........................      2,186,330 
        Central Hay Storage.............................        803,670 
        Repair Building 201.............................         50,000 
        BARC--East Waste Water Treatment................      6,534,000 
        Building 200 Modernization......................         60,000 
        Renovate Building 007...........................      1,290,000 
        Demolition......................................        198,904 
        Swing Space.....................................        991,888 
        Contingency.....................................         50,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................     15,999,792 
                    ========================================================
                    ____________________________________________________
    Fiscal Year 1992:
        Renovate Range 2 Greenhouse Complex.............      3,100,000 
        Repair/Replace Waste Water Treatment Facility...        300,000 
        Construct Plant Sciences Building...............     12,600,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................     16,000,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1993:
        Range 2 Greenhouse Complex......................      7,400,000 
        BARC--West Waste Water Treatment Plant..........      4,000,000 
        BARC--East Water System.........................        600,000 
        Controlled Environmental Chamber Facility.......        586,000 
        Office/Laboratory Economic Analysis.............        200,000 
        Animal Space Economic Analysis..................        230,000 
        Contingencies...................................        531,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................     13,547,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1994:
        Modernize Building 001..........................      9,700,000 
        Modernize East Potable Water System.............      7,400,000 
        Design New Animal Building......................        530,000 
        Upgrade West Electrical System..................      1,500,000 
        Design to Modernize Building 004................        450,000 
        Contingencies...................................        120,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................     19,700,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1995: Modernize Building 004............      3,960,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1996:
        Construct Controlled Environment Facility.......      4,700,000 
        Design/Construct Infrastructure in 300 Area.....      2,000,000 
        Contingencies...................................         60,000 
        New Animal Building Design......................        615,000 
        Cooling Tower for Building 004..................        375,000 
        Renovate Building 001...........................        250,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................      8,000,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1997:
        Design New BHNRC Building.......................      1,700,000 
        Infrastructure BARC--East.......................      1,400,000 
        Fiber Optic Backbone Cabling....................        700,000 
        Contingencies...................................        700,000 
                    --------------------------------------------------------------
                    ____________________________________________________

          Total.........................................      4,500,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1998:
        Construct New Feed Center.......................      1,970,000 
        Fiber Optic Backbone Cable......................        850,000 
        Contingencies...................................        380,000 
                    --------------------------------------------------------
                     ___________________________________________________
          Total.........................................      3,200,000 
                    ========================================================
                    ____________________________________________________
    Fiscal year 1999:
        Design/Construct New Poultry Barn...............      2,200,000 
        Demolish Facilities.............................        100,000 
        Contingencies/Miscellaneous Small Projects......        200,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................      2,500,000 
                    ========================================================
                    ____________________________________________________
    Proposed fiscal year 2000:
        Construct BHNRC.................................     11,400,000 
        Contingencies/Miscellaneous Small Projects......      1,600,000 
                    --------------------------------------------------------
                    ____________________________________________________
          Total.........................................     13,000,000 

    The balance of funds needed beyond fiscal year 2000 is in excess of 
$83.7 million. Due to uncertainty regarding future funding levels, and 
potential changes to priority projects, the Agency has not developed a 
firm phasing plan beyond fiscal year 2000.
    Question. What temporary space arrangements has ARS made to 
relocate its staff from the Army research laboratory at Presidio, due 
to the expiration of the lease at the end of April 1999?
    Answer. On February 2, 1999, ARS executed a short-term lease 
agreement with the University of California, Davis, for laboratory and 
office space on campus for the temporary relocation of personnel and 
programs from ARS' space at the Army research laboratory at the 
Presidio, San Francisco. This lease is effective through March 31, 
2003, and is renewable on a monthly basis.
    Question. When will the agency conduct and complete the further 
review of the most cost-efficient size and capacity of the replacement 
facility for the water conservation and cotton research program, as 
directed by Congress last year? If complete, please provide the 
results/findings to the Committee.
    Answer. ARS has conducted a review of the needs of its U.S. Water 
Conservation Laboratory and Western Cotton Research Laboratory in 
Phoenix and reevaluated the space requirements of a replacement 
facility. ARS' report is being reviewed by the Secretary's Office and 
should be submitted to Congress shortly.
    Question. Provide the Committee with a status report on the urgency 
of facilities' improvements at the Avian Disease Oncology Laboratory in 
East Lansing, Michigan. Has ARS done a cost-benefit analysis on this 
facilities modernization project, in terms of the cost of constructing 
new facilities versus relocation of the research program? Please 
provide the results of that analysis to the Committee.
    Answer. Building system components have exceeded their normal life 
expectancy and the existing facilities are in need of repair. 
Deficiencies include safety and health needs, such as fume hood 
upgrades, and ventilation issues in labs; accessibility issues; and 
building code compliance issues. These conditions have resulted in a 
facility that is costly to maintain and inadequate for present research 
programs. A four-phase program involving renovation, new construction, 
and demolition is underway. The total appropriations to date for 
planning and design are $2.262 million. The remaining need for 
construction, construction management, and contingency is estimated to 
be $17.2 million.
    ARS is presently conducting an analysis of ARS' poultry health and 
related facility needs. Results of this study will be provided to the 
Committee when completed. The agency is moving forward with the design 
for the modernization of this facility which performs research on 
domestic diseases of chickens. The design project is expected to be 
completed by June, 2000.
    Question. When will planning and design work funded over the last 
two fiscal years for the Poisonous Plant Laboratory, UT; Biocontrol and 
Insect Rearing Laboratory, MS; and Pest Quarantine and Integrated Pest 
Management Facility, MT be completed? Why isn't funding to begin 
construction of each of these facilities proposed for fiscal year 2000?
    Answer. The Poisonous Plant Research Laboratory design will be 
awarded in the third quarter of fiscal year 1999 and will be completed 
in the first quarter of fiscal year 2001. Construction funding will be 
required in fiscal year 2001.
    The name of the Biocontrol and Insect Rearing Laboratory has been 
changed to the National Biological Control Laboratory. The site design 
will be completed in fiscal year 1999, with full design of the facility 
completed in April 2000. Fiscal year 1998 funding of $900,000 for 
planning and design was rescinded by line item veto. The Agency did not 
anticipate that this would be reversed. Therefore, no construction 
funds were requested for fiscal year 2000. If fiscal year 2000 
construction funding is available in the amount of $13.4 million, site 
work can be awarded in January 2000, with full laboratory construction 
awarded by August 2000.
    The Pest Quarantine and Integrated Pest Management Facility design 
will be completed in the fourth quarter of fiscal year 1999. The 
necessary construction funds in the amount of $7.3 million were 
appropriated in fiscal year 1999. No further funding is required.
    Question. Provide a report on each of the ARS projects for which 
funds were provided for fiscal years 1998 and 1999, indicating the 
current status of the work funded, and what additional funds will be 
required, if any, to complete the project.
    Answer.
    [The information follows:]

                                              [Millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                     Additional
            Project Location                    Appropriated           needed                 Status
----------------------------------------------------------------------------------------------------------------
MAC, Mariocpa, AZ......................  1999--$0.5................       $23.1  Project is on hold pending
                                                                                  determination by the Agency of
                                                                                  the most cost-effective size
                                                                                  for the facility.
HWMRL, Parlier, CA.....................  1998--$23.4...............        None  Construction will be completed
                                                                                  in the Second Quarter of
                                                                                  fiscal year 2000.
WHNRC, Davis, CA.......................  1998--$5.2................              Design will be complete Davis,
                                         1999--$6.15...............         9.0   in the Fourth Quarter of
                                                                                  fiscal year 2000.
EBCL, Montpellier, France..............  1998--$3.4................        None  Construction will be complete
                                                                                  in the Fourth Quarter of
                                                                                  fiscal year 1999.
PBRC, Hilo, HI.........................  1999--$4.5................        51.0  Design will be completed in the
                                                                                  Fourth Quarter of fiscal year
                                                                                  2000.
NCAUR, Peoria, IL......................  1998--$8.0................              Phase II, Segment 2, Pilot
                                         1999--$8.2................        54.0   Plant construction will be
                                                                                  complete in the Third Quarter
                                                                                  of fiscal year 2000. Segment 3
                                                                                  design will be complete in the
                                                                                  Fourth Quarter of fiscal year
                                                                                  1999 and construction will be
                                                                                  awarded in the Fourth Quarter
                                                                                  of fiscal year 2000.
NADC, Modernization, Ames, IA..........  1999--$2.957..............       328.0  Waste Water Treatment Plant
                                         1999--$1.943 \1\..........               modernization design will be
                                                                                  awarded in the Fourth Quarter
                                                                                  of fiscal year 1999.
GRL, Manhattan, KS.....................  1999--$1.4................        8.25  Construction of Phases 1 and 2
                                         1998--$1.1................               will be awarded by the Third
                                                                                  Quarter of fiscal year 1999.
SRRC, New Orleans, LA..................  1998--$1.1................        15.0  Phase I (Industrial Wing)
                                         1999--$6.0................               Design will be completed LA in
                                                                                  the Second Quarter of fiscal
                                                                                  year 1999. Construction will
                                                                                  be awarded in the Third
                                                                                  Quarter of fiscal year 1999.
BARC, Beltsville, MD...................  1998--$3.2................        96.7  Feed Center design will be
                                         1999--$2.5................               completed in the Second
                                                                                  Quarter of fiscal year 1999.
                                                                                  Poultry Production design will
                                                                                  be awarded in the Third
                                                                                  Quarter of fiscal year 1999.
                                                                                  BHNRC design will be complete
                                                                                  in the Second Quarter of
                                                                                  fiscal year 2000.
NAL, Beltsville, MD....................  1998--$2.5................        26.3  Construction of Phase I will be
                                         1999--$1.2................               complete in the First Quarter
                                                                                  of fiscal year 2000.
E. Lansing, MI.........................  1998--$1.8................        17.2  Design will be completed in the
                                                                                  Second Quarter of fiscal year
                                                                                  2000.
Stoneville, MS.........................  1998--$0.9................        13.4  Design will be completed in the
                                         1999--$0.2................               Third Quarter of fiscal year
                                                                                  2000.
Sidney, MT.............................  1998--$0.606..............        None  Design will be completed in the
                                         1999--$7.3................               Fourth Quarter of fiscal year
                                                                                  1999. Construction will be
                                                                                  awarded in the First Quarter
                                                                                  of fiscal year 2000.
Las Cruces, NM.........................  1998--$0.7................        None  Design will be completed in the
                                         1999--$6.7................               Fourth Quarter of fiscal year
                                                                                  1999. Construction will be
                                                                                  awarded in the First Quarter
                                                                                  of fiscal year 2000.
PIADC, Greenport, NY...................  1998--$2.0................       57.0+  Electrical modernization
                                         1999--$3.5................               construction to be completed
                                                                                  in the Third Quarter of fiscal
                                                                                  year 1999. Sewage
                                                                                  Decontamination Plant design
                                                                                  will be awarded in the Third
                                                                                  Quarter of fiscal year 1999.
                                                                                  Boiler Plant Replacement
                                                                                  design will be completed in
                                                                                  the Third Quarter of fiscal
                                                                                  year 1999.
Grand Forks, ND........................  1998--$4.40...............        None  Construction to be completed by
                                                                                  the Third Quarter of fiscal
                                                                                  year 1999.
ERRC, Wyndmoor, PA.....................  1998--$5.0................        17.4  Phase 3 and 4, construction
                                         1999--$3.3................               will be completed in the First
                                                                                  Quarter of fiscal year 2000.
                                                                                  Phase 5 construction will be
                                                                                  awarded in the First Quarter
                                                                                  of fiscal year 2001.
Charleston, SC.........................  1998--$4.824..............        14.6  Construction of Phase I will be
                                                                                  completed in the Third Quarter
                                                                                  of fiscal year 2001.
Logan, UT..............................  1998--$0.6................         8.6  Design will be awarded in the
                                         1999--$0.030..............               Third Quarter of fiscal year
                                                                                  1999.
Leetown, WV............................  1998--$6..................        None  Construction will be awarded in
                                         1999--$2..................               the Fourth Quarter of fiscal
                                                                                  year 1999 with construction
                                                                                  completion by the Fourth
                                                                                  Quarter of fiscal year 2000.
----------------------------------------------------------------------------------------------------------------
\1\ Reprogrammed.

    Question. Does the Administration have any plans to close the 
Tucson laboratory which is conducting honeybee research?
    Answer. ARS is considering its options for providing support to the 
honey bee industry through its honey bee laboratories. ARS has four 
honey bee laboratories that have some overlap in program assignment. 
ARS has a partially occupied new facility for honey bee research at 
Weslaco, Texas. ARS believes that it would realize increased 
operational efficiency through program consolidation that would 
strengthen honey bee research. ARS has consulted with the bee industry 
and with the University of Arizona on relocation of the program at 
Tucson to Weslaco. ARS will not propose a reduction in the number of 
scientists or funding for honey bee research.
    Question. Please provide a list, by ARS project, of any available 
unobligated funds remaining from prior year appropriations.
    Answer. The following is a list of available unobligated funds 
remaining from prior year appropriations as of 2/28/99:

                             [In thousands]

        Project                                     Unobligated Balances
Albany, CA: Western Regional Research Center..................      $632
Athens, GA: Poultry Disease Laboratory........................     1,005
Charleston, SC: Vegetable Laboratory..........................       762
Davis, CA: Western Human Nutrition Research Center............     5,200
E. Lansing, MI: Avian Disease & Oncology Laboratory...........       655
Ft. Pierce, FL: Horticulture Laboratory.......................     1,495
Grand Forks, ND: Human Nutrition Center.......................       652
Greenport, NY: Plum Island Animal Disease Center..............     3,822
Las Cruces, NM: Jornada Range Research Center.................       602
Logan, UT: Poisonous Plant Research Laboratory................       600
Lubbock, TX: Plant Stress Laboratory..........................       647
Manhattan, KS:
    Grain Marketing Research Laboratory.......................        13
    Water Conservation Laboratory.............................       396
Montpellier, France: European Biological Control Laboratory...       335
New Orleans, LA: Southern Regional Research Center............       232
Oxford, MS: National Center for Natural Products..............     7,000
Parlier, CA: Horticulture Crop Research Laboratory............     6,604
Peoria, IL: National Center for Agricultural Utilization......  Research
Philadelphia, PA: Eastern Regional Research Center............     1,707
Riverside, CA: Salinity Laboratory............................       125
Sidney, MT: Pest Quarantine & Integrated Pest Management......       495
Stoneville, MS: National Center for Warmwater Aquaculture.....       900
Stuttgart, AR: Rice Research Center...........................       479
Weslaco, TX:
    Bee Laboratory............................................        76
    Subtropical Agricultural Research Laboratory..............     3,141
    Leetown, WV: National Center for Cool & Cold Water 
      Aquaculture.............................................    11,801
Beltsville, MD:
    Beltsville Agricultural Research Center...................     5,094
    National Agricultural Library.............................        94
Hurricane (Andrew/Iniki) Funds................................    11,177
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................    67,274

    Question. Provide a list of the facilities' maintenance and repair 
work, by project and location, funded in each of fiscal years 1997, 
1998, and 1999 and planned for fiscal year 2000, showing the cost of 
each.
    Answer. The fiscal year 1997 repair and maintenance budget was 
$18.262 million. This amount includes $14.246 million in Agency funds, 
$900,000 for the National Agricultural Library, $740,000 for the USNA, 
and $2.376 million in BARC Renaissance 1993 funds. Some of the types of 
repair and maintenance projects funded in fiscal year 1997 include: 
roof repair, HVAC repair, plumbing repairs, upgrade to sewage lines, 
electrical repairs, fencing replacement, painting, pavement repair, 
asbestos and lead abatement, accessability projects, and replacement of 
fire alarm systems.
    [The information follows:]

        State/Location/Project                                    Amount

AL, Auburn: Install New Roof Bldg 3.....................         $50,575
AR, Booneville: Replace Chill Water Air Conditioning 
    System Bldg 1.......................................          54,880
AR, Stuttgart: Rehabilitate Levies at 27 Acre Reservoir.          18,720
CA, Albany:
    Renovate Greenhouse Control & Ridge Vent Systems....         222,840
    Fire Alarms.........................................          24,825
CA, Davis: Resurface Access Road & Driveway.............          71,100
CO, Akron: Concrete Drive & Parking Area................         151,650
CO, Ft. Collins: Area Energy Audits.....................           7,228
DC, U.S. National Arboretum:
    Exterior Lighting...................................         250,000
    Paths, Irrigation, Drainage and Lighting............         300,000
    Bonsai Courtyard....................................          35,000
    Auditorium/Lobby Renovation.........................          20,000
    Trim and Remove Trees...............................          25,000
    Street Signs........................................          22,000
    Miscellaneous Repairs...............................          87,633
FL, Brooksville:
    Replace Water Systems...............................         347,333
    Replace Grain Storage Bins..........................          80,000
FL, Canal Point: Remodel Bldg 1.........................          31,030
FL, Gainesville: Replace Fire Alarm System..............          18,557
GA, Athens:
    Replace Sewage Connection Lines.....................          35,947
    A&E Services........................................           3,300
GA, Byron:
    Irrigation Well & Flow Meters.......................         257,005
    Connect to City Sewer System........................          40,846
    A&E Services........................................           4,164
ID, Dubois: Feed Distribution System....................         101,632
ID, Kimberly: Renovate HVAC System, Main Bldg...........         758,307
IL, Peoria:
    Energy Audits or Chemical Storage...................           9,897
    Replace Fire Alarm System...........................         195,000
IA, Ames: Upgrade HVAC System Bldg 4....................       1,691,128
KS, Manhattan: Partial Repaint Pilot Plant & Grain 
    Elevator Bldg.......................................          46,192
MD, Beltsville:
    Demolition of Facilities............................         300,000
    Mod Office Salaries.................................         197,327
    Inspection..........................................          51,052
    Replace CFC Refrigerants............................          20,000
    Telecommunications East & West (Y2K Upgrades).......         150,000
    Road Repairs........................................         100,000
    Roof Repairs........................................         100,000
    Install Dearator Bldg. 014..........................          70,000
    Replace Storm/Sanitary Lines 3rd St.................         100,000
    Convert 10 Boilers to Gas...........................         160,000
    Replace Steamlines, Bldgs 307 and 306...............         150,000
    Remove Pipe Chase Asbestos, Bldg. 200...............         150,000
    Correct Water Leak, Bldg. 008, Rms. 10 and 12.......          20,000
    Install Backflow Prevention on BARC.................         175,000
    Install Fall Protection at Sites....................          70,000
    Install Fence at Manure Pit.........................          10,000
    Install Smoke Indicator, Bldg 309...................          10,000
    Repair/Replace Granary Docking/Turnheads............          15,000
    Replace Roof, Bldg. 161.............................         150,000
    Replace Roof, Bldg. 301.............................          40,000
    Replace Variable Frequency Drives, Bldg. 007........          30,000
    Correct Drainage, Bldg. 50, GH 2/Section 2..........          10,000
    Install O/H Garage Doors, Bldgs 029, 1124, and 1125.          70,000
    Replace HVAC System, Bldg. 046......................          45,000
    Contingencies.......................................         182,683
MD, Frederick: Renovate Building 1301...................          30,000
MD, NAL:
    Sprinkler System, Phase II..........................         250,000
    Replace Cooling Tower...............................         375,000
    Miscellaneous/Emergency Repairs.....................         100,000
    Facility Seismic Study..............................          30,000
    Clean air Ducts.....................................         145,000
MN, St. Paul: Upgrade Steam System & Install Boiler.....          28,316
MS, Mississippi State: Repave Roadways and Parking Lots.         225,000
MS, Oxford: Renovation Chemistry Labs...................           9,484
MS, Poplarville Bldgs 1, 2 & 3: Sandblast, Seal & Paint.          40,000
MS, Stoneville: Replace Boilers & Steam Pipes...........         275,000
ND, Grand Forks:
    Flood Damage Project................................       2,244,472
    Upgrade HVAC........................................         563,594
NM, Las Cruces:
    Repair Fencing......................................          18,370
    Regravel HQ/Storage Area............................           3,600
    Repair Water Lines..................................           2,840
NY, Ithaca: Renovate Labs 201, 205, 222, Bldg. 002......         319,000
NY, Plum Island:
    Harbors & Docks.....................................         370,315
    Replace East End Exit...............................         199,341
OK, El Reno:
    Remove 34 Bldgs.....................................         207,600
    Laboratory Renovation...............................       4,464,360
OK, Woodward: Regravel Roads............................           8,075
OR, Corvallis: Repair Main Air Handler Intake...........           6,403
PA, Wyndmoor: Replace Underground Storage Tank..........          13,165
PA, University: Renovate Pasture Lab Bldg Park Basement.         143,800
PR, Mayaguez:
    Replace Emergency Generator.........................          21,500
    Repair Screenhouse..................................          50,000
TX, College:
    Pecan Building Accessibility........................          14,002
    Station Replace Electrical Distribution Panels......          65,943
    Replace Heating Pipes...............................          18,437
    Replace Boiler......................................          93,050
TX, Houston: Install HVAC Motion Sensor.................           9,767
TX, Kerrville: Remove/Replace Rusted Purlins & Roof 
    Panels..............................................         126,970
TX, Lubbuck: Greenhouse Repairs.........................           8,772
TX, Temple:
    Rework/Replace/Modify Hot Water System..............             134
    Handicap Accessability for Main Bldg................          36,900
TX, Weslaco:
    Building 305 Renovations............................          85,000
    Replace Light Fixtures..............................           2,340
    Retrofit Sprinkler System...........................           2,500
    Upgrade Field Drains................................           2,500
    Replace Roof Bldg. 201..............................          13,672
    Install Thermostats.................................           6,680
UT, Logan: Roof Replacement.............................          90,222
WV, Beckley: Construct Centralized Location For Lab Gas 
    Tanks...............................................         136,338
WY, Cheyenne:
    Overlay Pavement....................................          57,220
    Agency Reserve (Uncommitted)........................           9,986
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      18,262,519

    The fiscal year 1998 repair and maintenance budget was $18.262 
million. This amount includes $14.246 million in Agency funds, $900,000 
for the National Agricultural Library, $740,000 for the USNA, and 
$2.376 million in BARC Renaissance 1993 funds. Some of the types of 
repair and maintenance projects funded in fiscal year 1998 include: 
roof repairs, HVAC repairs, plumbing repairs, electrical repairs, water 
system repairs, sewage system repairs, road repairs, greenhouse repairs 
and reglazing, fencing replacements, telephone system repairs, 
painting, accessability projects, and replacement of fire alarm 
systems.
    [The information follows:]

        State/Location/Project                                    Amount

AZ, Phoenix: Renovate Three Labs........................        $252,794
AR, Booneville:
    Replace Greenhouse Doors, Fire Extinguisher.........           2,250
    Upgrade Sewage Lagoon...............................         107,590
CA, Albany:
    Exterior Manlift/Accessability Issue................          65,000
    Upgrade Mechanical Rooms............................         303,573
CA, Riverside: Upgrade Electrical Service...............          22,633
CA, Salinas: New Replacement Well.......................         106,000
CO, Fort Collins: Upgrade Security System...............          28,700
DC, U.S. National Arboretum:
    Exterior Lighting...................................         207,000
    Repair Paths, Irrigation, Drainage, and Lighting....         310,000
    Renovate Bonsai Courtyard...........................          25,000
    Auditorium/Lobby Renovation.........................          30,000
    Trim & Remove Trees.................................          25,000
    Chiller Repairs.....................................          23,000
    Replace Street Signs................................          21,000
    Miscellaneous Repairs...............................          99,000
DE, Newark:
    Replace HVAC Chiller................................          31,820
    Remove/Replace Greenhouse Benches and Sidings.......          32,937
FL, Brooksville: Repair Concrete Roadway................          32,681
FL, Canal Point: Repair/Modify Various Buildings........         336,342
FL, Gainesville: Modernization..........................       4,336,144
GA, Athens:
    RRC Handicap Ramps..................................          14,850
    Construction Management Renovation..................          57,260
    Renovate Laboratory for Handicapped Accessability...          18,053
    Renovate Warehouse..................................          24,543
    300KV Energy Generator..............................         107,743
    Repair Sewage System................................          28,064
    Elevator/Stair Construction.........................          75,000
GA, Byron:
    Repair Well.........................................          28,432
    Repair Electrical Distribution System...............          10,371
GA, Griffin: Replace HVAC in Headhouse/Greenhouse.......           6,628
GA, Tifton: Construction Management Renovation..........          41,800
GA, Watkinsville: Elevator/ADA Compliance...............           1,705
HQ Nationwide: Seismic Studies..........................         245,413
ID, Dubois:
    Repair Gravel Road..................................          35,000
    Repair 1.5 Miles of Entrance Road...................         248,806
ID, Kimberly: Repair Roof Bldgs 2, 3, 4 & 5.............         213,867
IL, Peoria:
    Replace Steam Traps.................................          47,594
    Replace Hot Water Tank..............................          33,788
    Upgrade Ventilation Basement, Center Wing, Other 
      Areas.............................................          65,000
    Install Additional Fire Hydrants....................         141,925
    Replace Cooling Water Tower.........................         150,000
IN, West Lafayette:
    Fume Hood...........................................           9,700
    Install Insulation in Grinding Room.................          17,966
IA, Ames:
    NADC Telephone Y2K Upgrade..........................         279,883
    Construct Bldg 5 Improvements.......................          54,563
    NADC Master Plan....................................         617,290
KS, Manhattan: Replace Telephone Switch (Y2K Upgrade)...          25,780
LA, Houma: Construct Handicapped Entrance...............           7,000
MD, Beltsville (BARC):
    Annual Demolition...................................         300,000
    Replace Refrigerants................................           9,735
    Upgrade Telecommunications (Y2K Upgrade)............         150,000
    Repair Animal Spaces................................         156,600
    Roof Repairs........................................         100,000
    Boiler Conversion...................................         148,019
    Replace Expansion Joints for Bldgs 306 & 307........          25,000
    Remove Pipe Chase Asbestos Bldg 200.................          86,682
    Correct Water Leak Bldg 008, Rms 10 & 12............          20,000
    Replace Chutes and Doors on Silos...................         123,814
    Replace Three Backflow Preventers BARC-W............          56,508
    Install Smoke Indicator Bldg. 309...................          10,000
    Repair/Replace Granary Decking/Turnheads............          15,000
    Replace Roof Bldg. 301..............................          40,000
    Replace Overhead Doors Bldg. 029, 1124/1125.........          70,000
    Replace HVAC System Bldg. 046.......................          45,000
    Renovate Laboratory Bldg. 200.......................         100,000
    Renovate Security Section, Bldg. 307................          15,000
    Update Security Alarms..............................          75,000
    Locate Underground Utilities........................          10,000
    Upgrade Telecommunications Equip. Bldg. 050 (Y2K 
      Upgrade)..........................................           8,000
    Paint Fence Bldg. 017...............................           1,900
    Replace Windows Bldg. 426...........................          30,000
    Replace Gas Boiler Bldg. 26.........................         225,000
    Recondition Elevators Bldg. 011A....................         120,000
    Ice Dam Bldg. 007...................................          55,000
    Update Telecommunications Equip. Bldg. 002 (Y2K 
      Upgrade)..........................................          15,000
    Paint and Repair Interior Bldg. 005.................         200,000
    Replace Storm Drain Poultry Modular Home............          25,000
    Fire Alarm Bldg. 003................................          25,000
    Fire Alarm Bldg. 308C...............................           7,000
    Modernization Office................................         169,845
    Replace Carpet Bldg. 003, Rm 20.....................           3,907
    Repair Cafeteria Bldg. 003..........................             500
    Miscellaneous Repairs...............................         133,552
MD, NAL:
    Sprinkler System....................................         263,000
    Cooling Tower.......................................         386,000
    Fifth Floor, HVAC...................................          53,000
    Air Handling Unit...................................          14,000
    First Floor Renovation..............................          55,000
    Miscellaneous Repairs...............................         129,000
MD, Frederick:
    Renovate Labs and Offices...........................         114,873
    Upgrade HVAC and Lab Infrastructure Bldg 1301.......         400,000
MI, East Lansing:
    Replace Roofs.......................................          34,280
    Sewage Disposal Improvements........................          35,270
MN, Morris:
    Install Fire Alarm System...........................          91,562
    Upgrade Microbiology Laboratory.....................          45,000
MN, St. Paul:
    Glazing on Greenhouse #2............................           3,930
    Repair Structure of Building........................         210,153
MO, Columbia: Improve Ventilation.......................         224,907
MS, Mississippi State: Replace Telephone System.........         212,222
MS, Oxford:
    Renovate Chemistry Labs.............................         148,270
    Paint Buildings.....................................          15,450
MS, Poplarville:
    Repair Well.........................................          19,915
    Replace HVAC Systems and Lights in Bldgs 1 & 2......          49,194
    Add Sheetrock to Interior Walls of Maintenance 
      Building..........................................          12,592
    Repair Well and Replace Storage Tank................          19,025
MS, Stoneville:
    Maintain Exterior of Building.......................           8,300
    Renovate Building 44 and 5..........................          24,019
    Repair Exterior JWRC................................          34,108
    Replace Sewer System JWRC...........................          29,524
    Caulk Windows.......................................           5,180
    Replace Underground Water Supply....................         106,682
    Renovation of Laboratory/Quarantine Facility........         100,000
    Repair Pond Levees..................................          84,216
    Replace Heating Pump................................          24,359
    Repair/Replace Structural Supports..................          38,703
    Replace Access Ramp.................................          12,089
    Modify HVAC System..................................          19,852
MT, Miles City:
    Maintain Windmills..................................           2,800
    Replace Telephone Switch (Y2K Upgrade)..............          25,000
    Additional Fencing Materials........................          33,771
    Maintain Waterers...................................           8,600
MT, Sidney:
    Upgrade HVAC System.................................         936,380
    Asbestos Abatement..................................          77,636
NC, Raleigh: Replace Chiller............................          53,842
ND, Fargo:
    Renovation Incinerator Building.....................          22,000
    Handicap Access.....................................           1,685
    Repair Greenhouse...................................           2,150
ND, Mandan:
    Re-roof Bldgs 3, 30 and 31..........................           5,340
    Renovate Security Fencing...........................          13,600
    Repair Gravel Road and Fencing Supplies.............          22,000
    Replace HVAC Motors.................................           4,220
    Glyco (HVAC)........................................           2,000
NE, Clay Center: Replace Telephone Switch (Y2K Upgrade).          42,740
NM, Las Cruces:
    Gravel & Seal Coat Parking Lots.....................           5,000
    Painting/Roof Repairs...............................          23,420
NY, Ithaca:
    Replace Fume Hoods, Fans Stacks.....................         173,339
    Repair Air Handling Unit, Main Bldg.................          26,438
    Repair Greenhouse & Road............................          24,100
    Construct Stairway Enclosure, Bldg 004..............           5,281
NY, Plum Island:
    Coating Existing Building 100.......................          43,670
    Animal Room Painting, Lighthouse Repairs, Cattle 
      Loading Dock Repairs, Replace Overhead Garage 
      Doors.............................................          54,730
OH, Coshocton:
    Repair Air Exchange System..........................          36,186
    Historic Survey.....................................           9,998
OK, El Reno:
    Develop Facilities Historic Preservation Plan.......         185,113
    Asphalt East Campus Road............................         138,651
    Renovate Bldg 45....................................         460,406
OK, Lane Replace: Automated Telephone System (Y2K 
    Upgrade)............................................           9,933
OK, Stillwater:
    Repair/Renovation of 3 Greenhouses..................          27,437
    Repair Asphalt Parking..............................          10,200
    Facility Condition/Energy Survey....................           4,626
OK, Woodward:
    Design/Analysis for HVAC/Electrical Upgrade.........          74,598
    Install UFAS Elevator...............................          30,644
    Painting Buildings 2, 7, 9, 11, 12..................          25,000
    Restroom/Elevator Upgrade...........................          50,327
    Regravel Roads......................................          25,000
OR, Burns: Upgrade Access Road..........................          29,910
PA, Univ. Park
    Renovate Grinding Room..............................          34,061
    Renovate Chemical Storage Area......................          19,375
    Upgrade/Replace HVAC................................          28,943
PA, Wyndmoor:
    ERRC Re-Roof........................................          81,585
    Replace Underground Storage Tank....................          52,525
SC, Charleston: Repair Pavement.........................          21,380
SC, Florence: Replace and Expand Exterior Walls of 
    Offices.............................................         161,100
TX, Bushland:
    Upgrade for Accessability...........................          20,000
    Replace 500 SF Gas House............................          16,585
TX, College Station:
    Energy Audit........................................          20,005
    Replace Electrical Distribution Panels Bldgs 11 and 
      12................................................          28,650
    Renovate Swine Facility.............................          31,000
    Comprehensive Roof Evaluation.......................           2,396
TX, Houston:
    Comprehensive Energy Audit..........................          20,000
    Roof Design, CNRC...................................           4,958
TX, Kerrville:
    Repair Polymer Roof Coating.........................          94,636
    R&M Projects........................................          10,400
TX, Lubbock:
    Replace Hot Water Piping............................          10,440
    Retrofit Greenhouse Screening.......................          10,000
TX, Temple:
    Upgrade Interior Building Ceiling Light.............          96,070
    Asbestos Removal....................................          42,976
    Replace AC, in Seed Building........................           5,000
TX, Weslaco: Replace Boiler Bldg 203....................           9,950
WA, Yakima: Upgrade Fire Alarm..........................          19,789
WI, Madison: Upgrade Building Access....................          74,511
WV, Beaver: Repair/Replace Exterior Lighting............          59,467
WV, Beckley:
    Master Plan/Deficiency Study/Energy Conservation....          57,235
    Alter Soils Prep Bldg redirected to Update Walk-In 
      Growth Chamber....................................          53,330
WV, Kearneysville: Maintain and Repair HVAC.............          37,000
WY, Cheyenne: Corral Poles, Lag Bots and Gravel.........           4,975
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      18,262,338

    The fiscal year 1999 repair and maintenance budget was 
$18.262 million. This amount includes $14.246 million in Agency 
funds, $900,000 for the National Agricultural Library, $740,000 
for the USNA, and $2.376 million in BARC Renaissance 1993 
funds. Some of the types of repair and maintenance projects 
funded in fiscal year 1999 include: roof repairs, HVAC repairs, 
plumbing repairs, electrical repairs, water system repairs, 
sewage system repairs, road repairs, greenhouse repairs and 
reglazing, fencing replacements, telephone system repairs, 
painting, accessability projects, replacement of fire alarm 
systems, and Y2K upgrades.
    [The information follows:]

        State/Location/Project                                    Amount

CA, Albany:
    WAB Lab Renovation Upgrade Solvent Processing.......         $72,000
    Facility............................................          85,000
    Sanitary/Storm Sewer Survey.........................          55,000
CA, Riverside: Rescreen Screenhouse.....................          80,000
CA, Salinas: Renovate Greenhouses.......................         222,000
CO, Akron: Replace Roof, Building 1.....................         110,000
CO, Fort Collins:
    Upgrade HVAC System.................................          50,000
    Upgrade Phone System (Y2K Upgrade)..................          30,000
DC, U.S. National Arboretum:
    Repair Lath House...................................         522,000
    Replace Exterior Lighting...........................          61,000
    Renovation of Lobby and Auditorium..................          41,000
    Restore Outdoor Restroom............................          25,000
    Miscellaneous.......................................          91,000
DE, Newark: Upgrade Quarantine Facility.................         320,000
FL, Canal: Point Laboratory Ventilation.................         161,300
GA, Athens:
    Renovate Storage Building...........................         250,000
    Sewage Decontamination System.......................         406,977
    RRC Modernization Study.............................         800,000
GA, Byron: Secondary Electrical/Fire and Security Alarms         137,500
IA, Ames:
    Construct Improvements to Building 5................         170,000
    Renovate Ag Facility Bldg. 3 Design.................         250,000
ID, Dubois:
    Repair/Refill Fire Hydrants.........................          25,000
    Construct Wheelchair Access.........................          35,000
ID, Kimberly:
    Remodel Exterior Walls..............................         310,000
    Repair Roof Bldgs 1.................................         157,000
MD, Beltsville (BARC):
    Miscellaneous Small Projects........................         203,401
    Demolition of Facilities............................         383,798
    Upgrade Telecommunications..........................         150,000
    Renovation of GGPL Laboratories.....................          19,007
    Bldg 005 Rehab......................................          70,750
    GH Control System...................................          75,000
    Repair Roads--1st St/Parking Lots Bldg 006 & 
      Visitor's Center..................................         260,000
    Replace HVAC Bldg 1180..............................          30,000
    Install Backflow Prevention Bldg 1040...............           1,975
    Renovation of Water Tower--across from Bldg 426.....         285,000
    Repair Animal Spaces................................         140,000
    Silicone Seal--Bldgs 001/002/003/004/005/006/007/307 
      & 308.............................................         150,000
    Paint Bldg 202......................................          48,000
MD, Beltsville (BARC):
    Correct Erosion Around Water Main--Entomology Road..          75,000
    Minor Renovations Bldg 005..........................         125,000
    Replace Building Control Bldg 050...................          25,000
    Install New Fire Alarm System Bldg 1040.............           3,635
    Replace Emergency Generator Bldg 014................          25,000
    Replace Steamlines between Bldgs 309 & 310..........          25,000
    Remove Breaching and Asbestos Bldg 014..............          22,000
    Telephone Forprs....................................             280
    Replace Round Door Bldg 010A........................          10,000
    Replace Door Bldg 031...............................             675
    Sliding Door (ADA) for Bldg 003.....................           3,511
    Small Miscellaneous Projects........................         100,000
    Bridge Inspections..................................           4,000
    Bldg 161 Install Ramp and Renovate Bathrooms (ADA)..          55,000
    Steam Tunnel Repair (SAFETY ISSUE) Bldg 200 to Bldg 
      201...............................................          50,000
    Log Lodge Repair....................................          35,000
MD, NAL:
    Clean Air Duct......................................         170,000
    Design AHU (Wings)..................................         175,000
    Clean Air Quality Study.............................          10,000
    Retrofit Low Volt Circuit Breaker...................          50,000
    Clean, Seal & Paint Sub-Basement Floor..............          30,000
    Repair Freight Elevator Doors.......................          20,000
    Replace Ceiling, Third Floor........................          20,000
    Annual Calibration High Voltage Equip...............          10,000
    Miscellaneous Small Projects........................         415,000
    Replace Air Handling Unit...........................       1,200,000
MD, Frederick: Renovate Lab and Office..................         300,000
MI, East Lansing:
    Upgrade Sewer System................................         265,000
    Replace Roofs.......................................         485,000
MN, St. Paul: Repair/Reglaze Greenhouse.................         180,740
MO, Columbia: Install Controls for Heating/AC...........          12,000
MS, Mississippi: Design Glass and Window State 
    Replacement.........................................          13,000
MS, Stoneville:
    Renovate HVAC System Building 8.....................         235,000
    Design Replace......................................             300
    Ton Chiller.........................................          13,600
    Elevator Repair Building 1..........................         160,000
    Repair Exterior Building 1..........................         300,000
MT, Miles City: Design Bridge...........................          50,000
NE, Clay Center: Overlay Road...........................         100,000
ND, Fargo:
    Replace Steam Boiler................................          60,000
    Repave Parking Area.................................         210,000
    Roof Repair.........................................         130,000
ND, Mandan:
    Repipe Chiller, Building 1..........................          60,000
    Upgrade Headhouse/Greenhouse........................          70,000
OK, El Reno:
    Repair and Pave Roadway.............................          52,000
    Develop Facilities Historic Preservation Plan.......         100,000
    Renovate Bldg. 45, Renovate Sheep Barn Bldg. 40, and 
      Renovate West Scale House Bldg. 67................       1,800,000
OK Woodward: Modify Restrooms, Building 6...............         100,000
OR, Corvallis: Repair Screenhouses......................         140,000
PA, University: Upgrade/Replace HVAC System Park........         200,000
PA, Wyndmoor: Y2K Upgrades..............................          59,000
PR, Mayaguez: Replace Vehicle Maintenance Building......          15,000
TX, College Stn.:
    Comprehensive Facility Assessment...................          30,000
    Repair Storm Damage to Greenhouses..................         293,500
    Refurbish Interior Building 3.......................         280,000
TX, Lubbock: Renovate Building 8........................         328,200
WA, Pullman: Upgrade Computer Controls in Greenhouse....          29,760
WY, Cheyenne: Replace Roofs.............................          31,000
WY, Laramie:
    Install Cooling System..............................          45,000
    Incinerator.........................................         100,000
    Uncommitted at this time............................       3,071,391
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................      18,262,000

    The fiscal year 2000 repair and maintenance budget is anticipated 
to be $18.262 million in Agency funds. Some of the types of repair and 
maintenance projects anticipated are: roof repairs, HVAC repairs, 
plumbing repairs, electrical repairs, water system repairs, sewage 
system repairs, road repairs, greenhouse repairs and reglazing, fencing 
replacements, telephone system repairs, painting, accessability 
projects, replacement of fire alarm systems, and Y2K upgrades.
    Question. Please describe the agency's activities and funding 
obligations in each of fiscal years 1997 and 1998 under the provisions 
limiting construction, alteration, repair and improvements of buildings 
in the ARS appropriations language specifying (1) that the cost of 
constructing any one building shall not exceed $250,000; (2) head 
houses and greenhouses shall be limited to $1,000,000; and (3) no more 
than ten buildings can be constructed or improved at a cost not to 
exceed $500,000 each.
    Answer. The agency's funding obligations in fiscal years 1997 and 
1998 under the specified provisions are as follows:

Buildings not exceeding $250,000:
    1997 New Storage Building (Pacific West Area).............  $207,000
    1997 New Screenhouse Building (Pacific West Area).........   113,000
    1997 New Barn (Midwest Area)..............................    90,000
    1998 New Storage Building (Pacific West Area).............   137,000
    1998 New Shop Building (North Atlantic Area)..............   160,000
    1998 New Residence (Beltsville Area)......................   115,000
Head house/Greenhouse not exceeding $1,000,000:
    1997 New Greenhouse, Riverside, CA........................   183,000
    1998......................................................   ( \1\ )
Ten Small Buildings not exceeding $500,000:
    1997 Administrative Building (Southern Plains Area).......   455,000
    1997 Building A (Southern Plains Area)....................   205,000
    1997 Building B (Southern Plains Area)....................   205,000
    1998......................................................   ( \1\ )

\1\ None.
---------------------------------------------------------------------------
                                 ______
                                 
                          Research Activities
                 Questions Submitted by Senator Cochran
 implementation of the agricultural research, extension, and education 
                           reform act of 1998
    Question. The Agricultural Research, Extension and Education 
Reauthorization Act of 1998 amends the Competitive, Special, and 
Facilities Research Grant Act (1) to require grantees to arrange for 
scientific peer review of their proposed research and merit review of 
their proposed extension and education activities prior to award; and 
(2) an annual report of the results of the research, extension, or 
education activity and the merit of the results. How are these new 
statutory requirements being carried out? Will the new requirements for 
scientific peer review of research grants and merit review of proposed 
extension and education activities delay the award of funds provided 
for fiscal year 1999?
    Answer. Prior to the award of a grant by the Cooperative State 
Research, Education, and Extension Service, grantees are required to 
arrange for scientific peer review of their proposed research 
activities and merit review of their proposed extension and education 
activities. The review arranged by the grantee must provide a credible 
and independent assessment of the proposed project. A credible review 
is one that provides an appraisal of technical quality and relevance 
sufficient for an organizational representative to make an informed 
judgment as to whether the proposal is appropriate for submission for 
Federal support. To provide for an independent review, such review may 
include USDA employees, but should not be conducted solely by USDA 
employees. A notice of completion of the review must be conveyed in 
writing to the Cooperative State Research, Education, and Extension 
Service either as part of the submitted proposal or prior to the 
issuance of an award. The written notice constitutes certification by 
the applicant that a review has occurred. Annually, within 30 days of 
the anniversary date of each award, the recipient must submit a report 
describing the results of the research, extension or education activity 
and the merit of the results.
    Regulations to implement these requirements were published as a 
proposed rule in the Federal Register on March 24, 1999. A 30-day 
period is provided for submission of public comments to be considered 
in the development of the final rule. To meet the statutory 
requirements, the Cooperative State Research, Education, and Extension 
Service cannot award fiscal year 1999 Special Grants until the final 
rule is published and recipients have certified that they have 
conducted reviews in accordance with the provisions of the final rule. 
It is anticipated that the final rule will be published in May. 
Therefore, the earliest date that Special Grants could be awarded is 
June 1999. However, while the rule making process is taking place, the 
Cooperative State Research, Education, and Extension Service is 
proceeding with the internal review of proposals and the preparation of 
grants for signature to minimize delays in making awards.
                      thomas jefferson initiative
    Question. The Agricultural Research, Extension, and Education 
Reauthorization Act of 1998 authorizes the Thomas Jefferson Initiative 
for Crop Diversification. The fiscal year 2000 budget proposes no 
funding for this program. Does the Administration support the program?
    Answer. The Administration does support the Thomas Jefferson 
Initiative for Crop Diversification. The Initiative is funded directly 
through a Cooperative State Research, Education and Extension Fund for 
Rural America grant entitled ``Diversifying Cropping Systems to Enhance 
Rural Development.'' The Center for Crop Diversification brings 
together a critical mass of partners and expertise to catalyze change 
in cropping systems and farming communities. The Center works with 
locally-led teams to develop new oilseeds, grains, fiber crops, and 
horticultural alternatives for targeted areas in the Midwest, Great 
Plains, and Pacific Northwest. Partners in this Center include farmers, 
non-profit organizations, and land-grant universities including the 
University of Missouri, Jefferson Institute, Purdue University, Iowa 
State University, University of Nebraska, Colorado State University, 
and Oregon State University.
    This project proposes to help farmers return to the constructive 
practices of diversification. Over a 4-year period the Center will 
accomplish several objectives spanning on-farm research, economic 
analysis and marketing, and comprehensive education programs. 
Activities to enhance rural development include developing teams of 
farmers conducting on-farm research on new crop options; supporting the 
farmer teams with technical, management, and marketing assistance; and 
building local support through workshops, on-farm tours, information 
exchange, and leadership development. Additional objectives include: 
providing facilities; serving as a central information resource; and 
reducing institutional barriers to diversification.
    Question. What funding would be needed for fiscal year 2000 to 
carry out the Thomas Jefferson Initiative for Crop Diversification?
    Answer. No additional funds are needed. The current grant awarded 
under the Fund for Rural America program runs through year 2002.
                           u.s. global change
    Question. Please provide the Committee with an update on USDA's 
Global Change/UVB Monitoring Program. What is the importance of this 
program to U.S. agriculture?
    Answer. The Cooperative State Research, Education and Extension 
Service, CSREES, is in the process of establishing a network for 
monitoring surface UV-B radiation which will meet the needs of the 
science community of the United States, and which will be compatible 
with similar networks being developed throughout the world. The fiscal 
year 1998 grant supports work through September, 1999.
    This grant is part of a government-wide initiative. The research is 
closely coordinated with other Federal agencies involved in the U. S. 
Global Change Research Program Inter-agency UV-Monitoring Network Plan.
    The principal researcher believes destruction of the stratospheric 
ozone layer, our shield from the full intensity of solar radiation, 
continues to increase. This creates a high priority need for 
information to document not only the levels of UV-B radiation reaching 
the earth's surface, but the climatology of that radiation. The United 
States, and the rest of the world, needs to know the strength of the 
UV-B radiation reaching the earth and the potential impact on all forms 
of life, especially animal and plant life of agriculturally-important 
species. The principal researcher believes this research to be of 
national as well as regional and local importance.
    The USDA UV-B Network is to provide accurate, geographically-
dispersed data on UV-B radiation reaching the surface of the earth and 
to detect trends over time in this type of radiation. A primary problem 
which had to be overcome in order to reach this goal is the development 
of instrumentation adequate to make the measurements required for the 
monitoring network.
    Colorado State University is managing the operating network, which 
when completed will include all regions of the country. At least 30 
sites are planned for the climatological network including sites in 
Hawaii, Alaska, and Puerto Rico in order to provide broad geographic 
coverage. Ten sites have been operational with broad band instruments 
for up to five years and 26 sites are now operational with new 
generation instruments. The research level network began with the first 
instrument installed at the Table Mountain, Colorado instrument 
intercomparison site and the second to be installed at the Department 
of Agriculture Plant Stress Laboratory at Beltsville, Maryland. 
Negotiations are underway with the Department of Energy Solar Radiation 
site near Ponca City, Oklahoma as part of the Atmospheric Radiation 
Measurements field network as a potential site for the third instrument 
to be deployed later in 1999.
    As with other weather and climate observations, this network will 
be an ongoing need for the predictable future. These measurements will 
provide information on the nature and seriousness of UV-B radiation in 
the United States and will provide ground truth validation to other 
predictions of UV-B irradiance. The project has now met it's first 
objective of the establishment of a climatological network to monitor 
UV-B radiation at the surface of the earth. Years of operation will be 
required to measure trends in UV-B radiation and to develop models to 
predict the climatology of UV-B radiation.
                        sustainable agriculture
    Question. Provide a list of the Sustainable Agriculture Research 
and Education (SARE) research grants awarded for fiscal year 1998, 
including a description of the project, who conducted the research, and 
the amount of the award.
    Answer. The list of the Sustainable Agriculture Research and 
Education (SARE) research grants awarded for fiscal year 1998 are as 
follows. Projects starting with E are Extension funds.
    [The information follows:]

                           SUSTAINABLE AGRICULTURE RESEARCH AND EDUCATION (SARE) RESEARCH GRANTS AWARDED FOR FISCAL YEAR 1998
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Project number                                      Project title                                  Project Coordinator              SARE
--------------------------------------------------------------------------------------------------------------------------------------------------------
ENC98-028................................  Alternative Information Networking to Support Sustainable    John Ikerd...........................    $32,950
                                            Agriculture on Small Farms.
ENC98-029................................  Michigan Field Crop Ecology: Training and Field              Natalie Bement-Rector................     47,677
                                            Demonstration.
ENC98-030................................  Marketplace '99............................................  Thomas Hanson........................     12,600
ENC98-031................................  Revitalizing Community Development in the Dakotas..........  Thomas Hanson........................     64,700
ENC98-032................................  Planning Sustainable Grazing Systems.......................  Mark Boswell.........................     45,740
ENC98-033................................  Developing Advanced Grazing Educational Materials and        Henry Bartholomew....................     60,000
                                            Schools on Sustainable and Profitable Grazing Systems for
                                            the North Central Region.
ENC98-034................................  Introduction to Management Intensive Grazing Systems         Deborah Cavanaugh-Grant..............     32,308
                                            Workshops and Resource Manual for Educators.
ENC98-035................................  Workshops on Land Use and Farmland Policy..................  Kevin Schmidt........................     48,247
ENC98-036.1..............................  Educate the Agricultural Educators and Bankers on            Paul Daigle..........................     12,500
                                            Profitability, Lifestyle and Environmental Benefits of MIG
                                            for the Livestock Farmers of Central Wisconsin.
ENC98-037.1..............................  Outreach Education for Permaculture as Native Science......  Ann Krush............................     36,450
ENE98-037................................  How to Keep Agriculture Sustainable: Training Trainers on    Julia Freedgood......................     77,282
                                            Conserving Farmland & Resolving Land Use Conflicts in the
                                            Delmarva Peninsula.
ENE98-038................................  Organic Grain Production Another Way.......................  John Hall............................     90,100
ENE98-039................................  Northeast Training @ Support Network for Agriculture         Judy Green...........................    132,392
                                            Development.
ENE98-040................................  Diagnostic Team Approach to Enhancing Dairy Farm             William Heald........................     50,000
                                            Sustainability, Phase II.
ENE98-041................................  Increasing Producer Adoption of Pasture of a Whole Farm      Edward Harwood.......................     30,393
                                            System.
ENE98-042................................  Feeding Our Cities: Establishing a Strong Urban/Sustainable  Michael T. Keilty....................      6,500
                                            Agriculture Interface in Southern New England.
ENE98-043................................  Nutrient management Education: Development and               Karen L. Gartley.....................      6,500
                                            Implementation of Training Modules on Basic Principles,
                                            Current State of Knowledge and Advances in Research.
ENE98-044................................  Locally Led Farmer Groups for Sustainable Agriculture: The   Jim Hanson...........................      6,500
                                            Study Circle.
ENE98-045................................  Re-Inventing the Appalachian Shephard......................  Tom McConnel.........................      6,500
ENE98-046................................  Conducting On-Farm Research: Enabling Farmers to Implement   Kathryne L. Everts...................     50,000
                                            Sustainable Change in Agriculture.
ES98-037.................................  Oklahoma Master Woodland Owners Program....................  William G. Ross......................     23,640
ES98-038.................................  Motivating Teams for Enterprise Facilitation...............  James V. Worstell....................     96,000
ES98-039.................................  Multi Disciplinary Training on Pasture-Based Dairy System--  Steve Washburn.......................     52,578
                                            A Sustainable Alternative for the Region.
ES98-040.................................  Grazing Management Training to Enhance the Sustainability    Jim Green............................     31,745
                                            of Pasture-Based Beef Production Systems.
ES98-041.................................  Training in Sustainable Systems Approach to Production,      William Patton.......................     99,912
                                            Harvesting, Processing and Marketing of Value Added Syrup
                                            Crops in MS and Surround States.
ES98-042.................................  Training in Agriculture Program (TAP)......................  Dorothy Barker.......................     17,890
EW98-001.................................  Broadening the Audience: Providing Sustainable Agriculture   David Chaney.........................     80,100
                                            Education for Pest Control Advisors and Agricultural
                                            Consultants in California and Oregon through Multiple
                                            Information Delivery Systems.
EW98-004.................................  Agroforestry Handbooks for Pacific Islands.................  Craig Elevitch.......................     57,685
EW98-007.................................  Navajo Noxious Weed Training Program.......................  Wallace Tsosie.......................     52,542
EW98-008.................................  Organic Food Production and Marketing--Educational Resource  Miles MeEvoy.........................     19,100
                                            Development.
EW98-009.................................  Alternative Crop for Dryland Agriculture in the              Edward Adams.........................     67,500
                                            Intermountain Pacific Northwest.
EW98-011.................................  Portable Extension Office for Program Literature Exchange    Bob Barber...........................     41,360
                                            (PEOPLE).
EW98-012.................................  Covering New Ground: Tropical Cover Crops for Improving      Richard Bowen........................     85,400
                                            Soil Quality.
                                                                                                                                              ----------
                                                 TOTAL, EXTENSION.....................................  .....................................  1,574,791
                                                                                                                                              ==========
LNC98-125................................  Feasibility of Agroforestry System using Management          Sandra Hodge.........................     48,487
                                            Intensive Grazing in Eastern Black Walnut Plantation.
LNC98-126................................  Marketing Sustainable and/or Organic Products in Small       David Watt...........................     41,355
                                            Metro Areas.
LNC98-127................................  County Fair Tomato Cooperative: Developing an Organic        Dan Nagengast........................     67,800
                                            Tomato Processing Cooperative.
LNC98-128................................  Congregationally Supported Agriculture.....................  Marvin Freiborg......................     38,900
LNC98-129................................  Strengthening Farms on the Edge: Developing Rural/Urban      Rebecca Cline........................     29,450
                                            Partnerships.
LNC98-130................................  Educating Consumers About Local, Sustainable Produced Meat.  Margaret Krome.......................     23,200
LNC98-131................................  Travelling Food Processing/Educational Trail-  er..........  Susan Houghton.......................     41,138
LNC98-132................................  Producer-Owned Cooperative to Process and Market             Aaron Heley..........................     23,590
                                            Sustainably Produced Pork.
LNC98-133................................  Strengthening Links Between Meat Producers, Processors, and  Jenifer Buckley......................      6,000
                                            Consumers.
LNC98-134................................  Perennial Legumes for Sustainable Pasture Systems..........  Craig Sheaffer.......................     99,800
LNC98-135................................  Annual Forages for Integrated Crop and Livestock Systems...  Burt Weichenthal.....................     52,000
LNC98-136................................  Addressing Agricultural Practices and Water Quality Issues   Marla Reicks.........................     41,498
                                            through Youth-Developed Decision Cases.
LNC98-137................................  Nutrient and Pesticide Loads in Subsurface Drainage from     Gregory McIsaac......................     78,902
                                            Organic and Conventional Cropping Practices.
LNC98-138................................  Soil Fertility Paradigms Evaluated through Collaboration On- Derrick Exner........................     59,027
                                            Farm and On-Station.
LNC98-139................................  Innovative Tart Cherry Orchard Systems: Design, Evaluation,  Charles Edson........................     75,000
                                            and Demonstration.
LNC98-140................................  Soil Quality Improvement with Cover Crop Mixtures..........  Eileen Kladivko......................     93,256
LNC98-141................................  Biological Control of Bacterial Diseases of Vegetable Crops  Sally Miller.........................    103,580
LNC98-142................................  Heartland Sustainable Agriculture Network..................  Jerry Jost...........................     64,000
LNC98-143................................  Adding Local Value with Community Partnership Strategies...  Denise Durham........................     37,800
LNC98-144................................  Alternative Systems for Livestock in Nebraska..............  Wyatt Fraas..........................     98,200
LNE98-098................................  Adaptive Nitrogen Management in Orchards: Developing Soil    Ian Merwin...........................    153,505
                                            and Groundcover Management Systems that Optimize Nitrogen
                                            Uptake, Retention and Recycling.
LNE98-099................................  Creating a Farmers-Owned Value-Added Production/Processing   Joe Detelj...........................     40,000
                                            Facility for Dairy Farmer in Central PA; A Joint Farmer/
                                            Community R&D Project.
LNE98-100................................  Producing Native & Ornamental Wetlands Plants in             Brian Maynard........................     72,840
                                            Constructed Wetland Designed to Reduce Pollution from
                                            Agriculture Sources.
LNE98-101................................  CORE Values Northeast: A Northeast IPM-Apple Consumer        Wendy Gordon.........................     45,000
                                            Education & Mkt Development Project.
LNE98-102................................  Sustainable Integrated Management of Weeds of Diseases in a  Helene Dillard.......................    140,000
                                            Cabbage Cropping System.
LNE98-103................................  Soil Amendment and Crop Rotation Effects on Productivity     Gregory A. Porter....................    100,126
                                            and Soil Properties within Potato Production Systems.
LNE98-104................................  Controlling Pests of Pastured Livestock on Organic Farms...  William Murphy.......................     32,590
LNE98-105................................  Controlling Honey Bee Mites with Essentials Oils...........  James Amrine.........................     80,000
LNE98-106................................  Biological Control for Soil-Dwelling Insects & Diseases in   Richard S. Cowles....................    147,557
                                            Strawberries.
LNE98-107................................  Integrated Management of Cranberry Insect, Weed, and         Carolyn DeMoranville.................    130,000
                                            Disease pests Using Fall and Spring Floods.
LNE98-108................................  Nutrition and Management of Dairy Sheep and Goats on         Bruce Clement........................    151,190
                                            Pasture.
LNE98-109................................  Resource Kit for Preserving Rural Character................  Jean Conklin.........................      6,000
LNE98-110................................  Development of a Knowledge Base for Site-Specific            Harold VanEs.........................    109,968
                                            Applications of Crop Nutrients.
LNE98-111................................  Use of Hoop Structures for Growing-Finishing Swine on the    Mark Estienne........................     32,000
                                            Delmarva Peninsula.
LNE98-112................................  Strengthening CSA in the Northeast: Next  Steps............  Kathryn Ruhf.........................     57,733
LNE98-113................................  Alternate Grain/Bean Rotations for Optimized Economic Yield  William Brinton......................     68,604
                                            in Northeast Organic Farming.
LS98-090.................................  An Integrated System of Organic Food Production and Urban    Anne Barkdoll........................    142,623
                                            Food Waste Recycling Using On-farm Anaerobic Digestion and
                                            Fertigation.
LS98-091.................................  Development of Decision Support Systems for Improvement of   Frederick W. Cubbage.................     26,204
                                            Silvicultural Practices on Farm-Based Non-Industrial
                                            Private Forests.
LS98-092.................................  Development of Sustainable Cropping Systems for Canola on    Udai Bishnoi.........................    124,488
                                            Limited-Resource Farms in Alabama.
LS98-093.................................  Accountability at Local, State, and Federal Levels for       Dwight Fisher........................    223,322
                                            Impacts of Agricultural Conservation Practices on Water
                                            Quality.
LS98-094.................................  A Model for Long-Term, Large-Scale Systems Research          J. Paul Mueller......................    558,758
                                            Directed Toward Agricultural Sustainability.
LS98-095.................................  Intergenerational Educational for Sustainable Agriculture..  Savanah E. Williams..................    176,240
LS98-096.................................  Integrating Farmer-Driven, Value-Added Enterprises into      Keith Richards.......................    120,590
                                            Sustainable Agricultural Systems.
LS98-097.................................  Introducing Alternative Crops Into Traditional Cotton-Grain  Roland E. Roberts....................    114,279
                                            Farming to Aid Transition To ``Freedom to Farm''
                                            Agriculture.
SW98-006.................................  Hybrid Poplars in Natural Buffer Systems for Agricultural    Barry C. Moore.......................    157,721
                                            Pollution Reduction and Income Enhancement.
SW98-031.................................  Advancing Sustainable Potato Production in the Northwest...  Karen Murphy.........................     42,000
SW98-036.................................  Indian Range Livestock Production in the West and            Robert Katnig........................    103,000
                                            Southwest: Entering, Enduring, and Emerging from Drought
                                            Conditions.
SW98-041.................................  Evaluation of Processing Food Refuse and By-products for     Farouq G. Abanni.....................    121,850
                                            Growing Finishing Swine.
SW98-044.................................  Cropping Systems for Intensive Desert Vegetable Production.  Milt McGiffen........................    130,672
SW98-058.................................  Reducing Chemical Inputs in Arid Climates through            Schuyler Seeley......................    261,044
                                            Sustainable Orchard Management.
SW98-060.................................  Acequia Conservation Management............................  Marcario Herrera.....................     49,272
SW98-064.................................  Selecting Cattle to Prevent Grazing Distribution Problems..  Derek W. Bailey......................    115,598
SW98-068.................................  Minimum Tillage Systems for Cotton: Reduced Energy, Time     Wayne Coates.........................    182,850
                                            and Particulates.
SW98-071.................................  Annual Legumes in Fallow as an Integrated Crop/Livestock     James M. Krall.......................    173,979
                                            Alternative in the Central Great Plains.
                                                                                                                                              ----------
                                                 TOTAL, RESEARCH......................................  .....................................  5,314,586
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Question. Provide a list of the SARE producer grants awarded for 
Fiscal Year 1998.
    Answer. In fiscal year 1998, 131 producer grants were awarded.
    [The information follows:]

                                                   PRODUCER GRANTS GRANTS AWARDED FOR FISCAL YEAR 1998
--------------------------------------------------------------------------------------------------------------------------------------------------------
              Project number                                      Project title                                  Project Coordinator              SARE
--------------------------------------------------------------------------------------------------------------------------------------------------------
FNC98-201................................  Wolf's Native Garden Project...............................  Charlie Smoke........................     $4,160
FNC98-202................................  Expanding Partnerships Between Southern Michigan Cash Crop   Henry Miller.........................      5,000
                                            Farmers and Northern Michigan Livestock Farmers.
FNC98-203................................  Southwestern Michigan Marketing Plan for Locally-Grown       Phillip Prillwitz....................     10,000
                                            Produce.
FNC98-204................................  On-Farm Market for High Quality, Locally Grown Products and  Pamela Bosserd.......................      4,490
                                            an Experience for School Age Children.
FNC98-205................................  Deer Damage Abatement Research Project.....................  Gary Mensinger.......................      3,627
FNC98-206................................  Alternative Use for Small Tobacco Acreage in Southeastern    Denise Dailey........................      3,270
                                            Indian.
FNC98-207................................  Biological Control of Pests................................  David Kreutz.........................      2,089
FNC98-208................................  Sustainable Hog Production in Old Farm Buildings...........  Dave Serfling........................      4,770
FNC98-209................................  Enhancing Native Solitary Bee Populations for Pollination..  John Cuddy...........................      4,700
FNC98-210................................  Keep the Cows in the Corn Even During the Winter Storms....  Donald Struxness.....................      4,997
FNC98-211................................  Removal of Infected Fescue with Warm Season Grasses and      Von Dole.............................      1,738
                                            Introduction of Legumes.
FNC98-212................................  The Rotational Cutting of Clover Will Increase the Quantity  James Harlow.........................      3,347
                                            and Quality of Honey and Bees Within a Specific Habitat.
FNC98-213................................  You Pick for the Handicapped...............................  Thomas Robinson......................      5,000
FNC98-214................................  Alternative Vegetable Crop Irrigation System for Remote      Kevin Smyth..........................      2,110
                                            Areas.
FNC98-215................................  Elixir Farm: Chinese Medicinal Herbs as Field Crops in the   Lavinia McKinney.....................      5,000
                                            Ozarks.
FNC98-216................................  The Expansion of the South Dakota Goosemobile Project to     Tom Neuberger........................      9,025
                                            Include Beef, Lamb and Pork.
FNC98-217................................  Alternative Nitrogen Sources for O.........................  John Ellis...........................      3,617
FNC98-218................................  Speciality Meats Marketing Project at Sycamore Street        Phil Hueneke.........................      9,984
                                            Market.
FNC98-219................................  Interseeding Legumes Into Fescue...........................  Tom Mulroy...........................      1,455
FNC98-220................................  Beef Alliance Association to Develop a Premium Market......  Larry Becker.........................      3,650
FNC98-221................................  Creating and Expanding Direct Markets for Sustainable        Dennis Rabe..........................      5,000
                                            Products.
FNC98-222................................  Machinery Link Co..........................................  David Govert.........................      5,000
FNC98-223................................  Establishing On-Farm Management Systems for Grass-Fed Beef.  Doug Erickson........................      4,980
FNC98-224................................  Economically Powered Water Supply Systems for Remote         Donn Teske...........................      3,372
                                            Locations.
FNC98-225................................  Creating Value in Pooled Cull Cow Sales....................  Myron Runft..........................     10,000
FNC98-226................................  Composting Greenhouse......................................  Jan Metz.............................      3,848
FNC98-227................................  Chariton Valley Beef Industry Initiative: Producer Cost      Mike Hunter..........................      9,875
                                            Share for Technology Adoption and Market Access.
FNC98-228................................  Quantifying Seasonal Nutrional Changes in Managed Pastures.  Greg Williamson......................      5,000
FNC98-229................................  Don't Take Grass for Granted...............................  Jack Orts............................      1,977
FNC98-230................................  Results of Alternative Usage of Apistan Strips and Formic    Kathy Hawthorne......................      4,951
                                            Acid for Mite Control in Honeybee Colonies.
FNC98-231................................  Sugar Maple Control and Hardwood Restoration in Central      Kevin Green..........................      5,000
                                            Illinois Woodland.
FNC98-232................................  Swath-Grazing: A Potential Alternative to Hay Feeding for    Mark Sip.............................      2,955
                                            Wintering Beef Cows in the Northern Plains.
FNC98-233................................  Organic Livestock Marketing Coop...........................  Ronald Rosmann.......................     10,000
FNC98-234................................  Low Environmental Impact Establishment of Hybrid Popular     Michael Nohner.......................      2,790
                                            Plantation.
FNC98-235................................  Trout and Walleye Production in Freshwater Springs.........  Michael Rahe.........................      4,834
FNC98-236................................  Cover Crops Influence on Soil Quality in No-Till Corn/       Gary Manley..........................      5,000
                                            Soybean Rotations: The Role of Soil Arthropods.
FNC98-237................................  Expansion of Grape Production..............................  Marchell Baehr.......................      4,940
FNC98-238................................  Honey Bee Varroa Mite Control Research and Langstroth        Robert Cessac........................      4,797
                                            Versus Top Bar Hive Economics.
FNC98-239................................  A Consumer Driven System to Natural Beef Marketing.........  Diana Endicott.......................      9,449
FNC98-240................................  Utilizing Alternative Harvesting Methods in Storing Silage.  David McCartney......................      5,000
FNC98-241................................  Sustainable Viniculture for Midwestern Fruit Growers.......  Gene Sigel...........................      5,000
FNC98-242................................  Kura Clover Cover Crop Demonstration.......................  Dan Barns............................      1,290
FNC98-243................................  ``Weed and Feed'' Vegetable Transplants with Corn Gluten     Renee Randall........................      4,866
                                            Meal.
FNC98-244................................  Determination of Optimal Application Amounts Needed for      Denice Trimmer-May...................      4,996
                                            Weed Control and Soil Amendment Qualities of Corn Gluten
                                            Meal in the Production of Strawberries.
FNC98-245................................  Linking Downstate Illinois Small-Scale Goat and Sheep        Les Gioja............................      2,338
                                            Producers.
FNC98-246................................  Prairie Wetlands...........................................  David Zahrt..........................      2,836
FNE98-190................................  Guinea Foul for Orchard Income and Insect Control..........  Warren Bower.........................      1,820
FNE98-191................................  Training Site for the Micro Process Design 25 Gallon Vat     Courtney Haase.......................      5,500
                                            Pasturizer.
FNE98-192................................  Soil Quality Improvement in Field Crops Using Legume         John Shearer, Jr.....................      1,725
                                            Overseeding.
FND98-193................................  Farmers Marketing Strategy for Westmoreland City...........  Paul Sarver..........................      6,300
FNE98-195................................  Commercial Organic Hops Production Trial...................  Jeffrey Klein........................      3,512
FNE98-196................................  Establishment of an Herbal Ley: Phase 1....................  Stephen Sheen........................      1,375
FNE98-197................................  Managed Intensive Grazing..................................  Ray Paddock..........................      8,353
FNE98-198................................  An Alternative to Flooding for the Winter Protection of      Bert-Sid Look........................      4,938
                                            Cranberries in ME.
FNE98-199................................  Barber Ledge Organic Dairy: Composting.....................  Mark Russell.........................      1,535
FNE98-200................................  Organic No-Till Cropping System Farm Evaluation 1998-2000..  Jon Danko............................      4,200
FNE98-202................................  Evaluating Raised Beds and Various Mulches for Vegetable     Ed Armacost..........................      3,120
                                            Production.
FNE98-203................................  Squash Vine Borer and Cotton Row Covers....................  Bryan O'Hara.........................      1,540
FNE98-204................................  Raspberry Mulch Evaluation.................................  Chris Bailey.........................      1,895
FNE98-205................................  Sustainable Aquaculture Waste Management Through Cranberry   Wilson Sallum........................      6,625
                                            Bogs.
FNE98-206................................  Low-input Sustainable Dairy Farming Through Draft Horse      Dennis Trainor.......................      1,825
                                            Power.
FNE98-207................................  Development of a Potting Media Utilizing Composted Poultry   Jay Martin...........................      1,744
                                            Litter.
FNE98-208................................  Sheep Farmstead Cheesemaking in CT.........................  Suzanne Sankow.......................      3,050
FNE98-209................................  Timing and Intensity of Cultivation and Effects on Weed      Gerald Fortin........................      2,770
                                            Control.
FNE98-210................................  Development and Implementation of Marketing Strategies for   Dave Randall.........................      4,770
                                            Emu Meat.
FNE98-211................................  Developing Excellence in Grass Hay Farming.................  Matthew Beckerink....................      7,500
FNE98-212................................  Elk Farming................................................  Debra Armstrong......................      5,610
FNE98-214................................  Goldenseal Production for Sustainable Woodlot Management...  Tom Griffin..........................      4,125
FNE98-214................................  Designing and Establishing a Small-Scale Goat Milk           Thomas Clark.........................      1,223
                                            Cooperative.
FNE98-216................................  Integrated Approach in Controlling Japanese Beetles Project  George Joseph........................      4,117
FNE98-217................................  Northeast Livestock Export Program (Phase  III)............  Lydia Ratcliff.......................      5,370
FNE98-218................................  Improving the Viability of Lamb Production in VT through     Lawrence Faillace....................      2,766
                                            the Use of Superior Genetics.
FNE98-219................................  Rootswork 1998--A Community-based Research, Demonstration,   Linda Faillace.......................      3,393
                                            Education and Participation Project.
FNE98-220................................  Forest Grown Medicinal Plants to Increase Woodlot Income...  Charles Baylies......................      1,545
FNE98-221................................  Effect of Compost Teas in Controlling Late Blight Damage to  Donald Kretschmann...................        500
                                            Tomatoes in Pennsylvania.
FNE98-222................................  Improving Air Quality in Diary Barns Using Sodium Bisulfate  Mia Lee Morrison.....................      1,690
FNE98-223................................  Apple Pest Management Trial................................  Louis Lego...........................      2,669
FNE98-224................................  Sustainable Fire Pruning on Lowbrush Blueberries with        Thomas Ford..........................      1,895
                                            Recycled Paper.
FNE98-225................................  Year Round Hydroponic Tomato Production....................  Donnie Tenney........................      2,499
FNE98-226................................  Expanding Local Production of Cage Cultured Hybrid Bass by   Fred Hays............................      4,996
                                            Demonstrating an Integrated Approach with Limited Space
                                            and Equipment and Farmer Cooperation.
FNE98-227................................  The Feasibility of a Growing Organic, Wild Simulated         Michael Fillion......................      5,500
                                            Ginseng in a Northern Maine Climate.
FNE98-228................................  Low-Cost Conversion of Cow Dairy to Sheep Dairy............  Neil Urie............................      4,625
FNE98-229................................  Research and Development for Existing Cooperative Preorder   Jean Paul Courtens...................      4,970
                                            Distribution of Local Foods.
FS98-066.................................  Adding Value to Kentucky Grown Produce Through Season        Ann Bell.............................      8,670
                                            Extension and Market Development.
FS98-067.................................  Feasibility of Indoor Culture and Production of Ornamental   Robert Draughon......................      2,216
                                            Goldfish.
FS98-068.................................  Late Blight Suppression in Tomatoes--Using Competing Fungi   Tom Elmore...........................      5,800
                                            on Leaf Surfaces.
FS98-069.................................  Integrated Goat Management System for Fiber and Meat.......  Claud Evans..........................     10,000
FS98-070.................................  Red Plastic Mulch as an Alternative to Insecticides in       John Frazier.........................      7,390
                                            Production of Seedless Watermelons.
FS98-071.................................  Workshop on Parasite Control Through On-Farm Fecal Studies.  Susan Gladin.........................      6,545
FS98-072.................................  Microbial Input for Organic Production of Vegetables.......  Skip Glover..........................      9,039
FS98-073.................................  Developing a Diary hair Sheep: Assessing the Potentials....  Army Hayner..........................      4,377
FS98-074.................................  Alfalfa Hay Production to Lower Soil Phosphorus Levels       Keith Boozer.........................      9,556
                                            Caused by Animal Waste Application.
FS98-075.................................  An Intensive Marketing Workshop for Growers and Ranchers...  Sue Johnson..........................      7,561
FS98-076.................................  Development of Low Input Sustainable Practices for Rose      Jacqueline Jones.....................      2,690
                                            Production.
FS98-077.................................  Test marketing and Financial Analysis of Fresh Cut Flowers.  Emmett Lowe..........................      5,416
FS98-078.................................  High-Fructose Corn Syrup as a Replacement for Mepiquat to    Hubert Morris........................      2,224
                                            Reduce Vegetative Growth in Cotton.
FS98-079.................................  Demonstration of a Low-Input Diversified Small Farm          Theodore Nesmith.....................      8,900
                                            Operation.
FS98-080.................................  Establishment of a Grazing Management School for Producers.  Kenneth Rogers.......................      9,260
FS98-081.................................  Soil Nutrient Balancing in Vegetable Produc-  tion.........  Mark W. Schonbeck....................      7,325
FS98-082.................................  Using Shearing to Control Nantucket Pine Tip Moth in         William Slaugher, Jr.................      5,672
                                            Virginia Pine Christmas Trees.
FS98-083.................................  Organic Specialty Lettuce Production in Tobacco Greenhouses  John Vollmer.........................      7,455
FW98-002.................................  Baby Corn-Alternative Crop for Southwest Washington........  Owen Schaffner.......................      3,460
FW98-003.................................  Local Feed Production for Tilapia..........................  Nocolas Songsong.....................      4,500
FW98-004.................................  The Conversion of Agricultural Waste into Plant and Fish     Robert Gann..........................      3,400
                                            Food.
FW98-009.................................  Soil Solarization as a Methyl Bromide Alternative in         Touxia Thauxaochay...................      4,000
                                            Strawberries.
FW98-012.................................  Solarization for Small Farm ``Specialty  Crops''...........  Mike Smith...........................      4,000
FW98-019.................................  Using a Cultivable Catchment System to Establish a Dryland   John Leaf............................      2,700
                                            Commercial Truck Farm.
FW98-020.................................  Testing Alternative Crop Rotations for Traditional Small     James Faughnan.......................      3,000
                                            Grain/Fallow System.
FW98-021.................................  SDA Community Nutritional Support Group....................  Litani Ahoia.........................      4,646
FW98-024.................................  Integrated Weed Management of Musk Thistle with Emphasis on  Larry Malschke.......................      2,938
                                            Biological Control.
FW98-025.................................  Annual Forage Production for an Intensive Winter Grazing     John Haws............................      2,665
                                            System.
FW98-030.................................  Permanent Irrigated Pasture Demonstration Project Reducing   Milford Denetolaw....................      3,100
                                            Irrigation Water Use.
FW98-031.................................  Navajo Nation Livestock Disease Survey.....................  Glenda Davis.........................      7,000
FW98-032.................................  The Sustainable Use of Cover Crops in an Annual Vegetable    Don Bustos...........................      4,289
                                            Production System in Northern New Mexico.
FW98-035.................................  Annual Forages for Dryland Rotations.......................  Vern Pluhar..........................      1,540
FW98-036.................................  Brewster Area-wide Management (BAM)--Low Impact Control of   Jim Davis............................     10,000
                                            Codling Moth and Leafroller in Applies.
FW98-055.................................  Onenoa Eel and Tilapia Farm................................  Alosina Toamalatai...................      2,210
FW98-056.................................  Piggery Deep Litter System.................................  Nikolao Mageo........................      2,975
FW98-057.................................  Beef Cattle Pasture Management Project.....................  Ma'ataura Te'o.......................      2,900
FW98-062.................................  Free Range Pork Production.................................  Samuel Okami.........................      5,390
FW98-063.................................  Total Utilization of Swine Waste for Crop and Hog            Ronald McKeehan......................      4,985
                                            Productivity.
FW98-064.................................  Propagation of Indigenous Lingonberry Species for            Vickie Talbot........................      5,000
                                            Sustainable Development.
FW98-065.................................  Cultures and La Manga Cattlemen's Association Range          Dennis Moeller.......................      8,700
                                            Analysis and Improvement Project.
FW98-067.................................  Low Cost Vacuum Silage in the Pacific Northwest............  Tim Clark............................      3,460
FW98-072.................................  Goats as a Source of Weed and Brush Control in Forest        Aaron Albaugh........................      5,000
                                            Plantations.
FW98-074.................................  Clover Creek Ranch Early Weaning Compari-  son.............  Ron Jones............................      2,658
FW98-075.................................  High Quality Perennial Forage Peanut (Arachis pintal)        Zach Gibson..........................      5,000
                                            Pastures for Sustainable Cattle Production in Hawaii.
FW98-076.................................  Organic Soil Amendments and Fertilization Practices for      Woody Deryckx........................      8,025
                                            Processed Vegetable Crops: A Study in Nitrogen
                                            Mineralization and Soil Quality.
FW98-082.................................  Alternative Techniques for Control of Apple Replant Disease  Fred Barkley.........................      3,200
FW98-093.................................  Cull Potato Composting.....................................  Steve McCullough.....................      7,500
FW98-097.................................  Fear and Loathing in the Potato Patch: Controlling           John O'Connor........................      9,910
                                            Nematodes with Rape Seed Meal and Green Manures.
FW98-099.................................  Wiersema Dairy Agroforestry Project........................  Jim Wiersema.........................      5,000
                                                                                                                                              ----------
                                                 TOTAL, PRODUCER GRANTS...............................  .....................................    619,480
--------------------------------------------------------------------------------------------------------------------------------------------------------

                             formula funds
    Question. What is the rationale for the reductions proposed in 
formula grant funding? Why doesn't the Administration consider these 
programs a priority?
    Answer. As you know, the Administration supports a balanced 
portfolio of funding for university-based agricultural research 
including formula programs, competitive grants, special grants and 
projects, and other programs such as Smith-Lever 3(d).
    In fiscal year 1999, formula programs received approximately $540 
million, almost five times the funding for competitive grants funded 
through the NRI. The Administration believes that the fiscal year 2000 
budget proposals, which reduces this imbalance, actually results in 
increased funding for formula institutions.
    This is because redirecting funds to competitive grant programs 
does not have to be at the expense of our land grant partners. In 
fiscal year 1998, land grant colleges and universities received 
approximately 75 percent of the funds awarded under CSREES competitive 
grant programs. If past percentages hold true, the proposed $81 million 
increase in the National Research Initiative in fiscal year 2000 may 
result in $61 million in additional research to land grant colleges and 
universities more than offsetting the proposed decrease in formula 
funds and ensuring that federal research, extension and education 
programs meet national priorities. The Administration also believes 
focusing on competitive programs will allow USDA to leverage research 
dollars from other agencies such as NSF, Environment Protection Agency, 
and National Institutes of Health to agricultural problems, thereby 
increasing the funding opportunities for land grant partners. A broadly 
competitive grant program will also ensure that scientific expertise 
from outside the land grant system will be brought to bear on 
agricultural problems, thereby increasing the potential return to 
taxpayers. Through this approach to research funding, the 
Administration believes more resources can be devoted to agricultural 
problems and we can continue to provide our farmers, ranchers and 
consumers with world-class cutting edge research to meet the ever 
increasing array of production, processing and nutritional challenges 
that face them.
    Competitive grants are an important mechanism for achieving 
accountability to taxpayers. The Agricultural Research, Extension and 
Education Reform Act of 1998 sets specific standards for federally 
funded agricultural research activities, including activities resulting 
from formula funding programs. Section 101 (a) requires that 
agricultural research, extension or education activities address 
priority concerns that are of national, multi-state or regional in 
significance. The legislation also requires the Secretary of 
Agriculture set research priorities after consulting with persons who 
conduct or use agricultural, research, extension or education and that 
entities receiving formula funds also develop a procedure for receiving 
such input into program development. Competitive grant programs provide 
an opportunity for the Administration to meet that statutory obligation 
to taxpayers. Following extensive consultation with stakeholders 
including the National Research, Extension and Education Advisory 
Board, the land grant university system, and producer representatives, 
the Administration develops a list of national agricultural research 
priorities for fiscal year 2000, including food safety, methyl bromide 
alternatives, small farms, Food Quality Protection Act implementation 
and water quality. Through the competitive grants process, the 
Cooperative State Research, Education, and Extension Service (CSREES) 
can ensure that scarce federal resources are used to address these high 
priority concerns. States and localities may still choose to invest the 
funds they receive through formula programs or other sources to address 
issues of immediate state and local concern as identified through their 
own stakeholder input process. Since they are free to use those funds, 
as well as the funds they receive from formula programs in the manner 
they choose, the impact of the proposed fiscal year 2000 budget will 
vary from state to state.
    Question. How is the increased funding provided for fiscal year 
1999 for each formula program being used?
    Answer. The laws authorizing Federal formula programs enable the 
States to determine how to use their formula allocations for specific 
projects or programs to address critical issues facing agriculture in 
their States, region, and the Nation. Generally, the areas of research 
supported with Hatch Act funding include forest and natural resources; 
crop resources; animal resources; people, communities and institutions; 
competitions trade, adjustment, price, and income policy; and food 
science and human nutrition. The areas of research supported with 
McIntire-Stennis funding include timber production; forest land 
management; wood utilization; the associated development of new 
products and distribution systems; and wildlife, recreation, water, 
range, and environmental quality. Evans-Allen funding supports research 
emphasizing small-scale agriculture; human nutrition; rural development 
and quality of living; crop resources; and animal resources. Animal 
Health and Disease funding is dedicated to improving the health and 
productivity of animals; protecting human health through control of 
animal diseases transmissible to humans; minimizing livestock and 
poultry losses resulting from transportation and handling; and 
facilitating the effective treatment and prevention of animal diseases.
    Funds provided to the States under the Smith-Lever 3(b) and (c) 
formula program support base extension programs in Nutrition, Diet and 
Health; Natural Resources and Environmental Management; 4-H and Youth 
Development; Leadership and Volunteer Development. The base programs 
are the foundation of the extension mission, but there are special 
emphasis areas that are periodically targeted as National Initiatives 
by the Cooperative Extension System. Currently, the National 
Initiatives include Food Safety and Quality; Children, Youth, and 
Families at Risk; Managing Change in Agriculture; Workforce 
Preparation; Healthy People/Healthy Communities; Animal Waste; and 
Child Care. Formula funds provided to the 1890 Institutions for 
extension activities are used to address the needs of small-scale and 
minority agricultural producers and other limited-resource audiences.
                               management
    Question. How does CSREES cover its overhead and management costs? 
Please provide an accounting of these costs for fiscal year 1998.
    Answer. Funds to administer CSREES' programs are obtained in 
primarily two ways: from a percentage set-aside of a program's total 
appropriation or from funds appropriated specifically for Federal 
administration. An accounting of these costs for fiscal year 1998 are 
as follows:

                Fiscal Year 1998 CSREES Management Costs

Personnel Compensation:
    Total personnel compensation........................     $20,336,340
    Personnel benefits..................................       5,016,930
    Benefits for former personnel.......................             728
                    --------------------------------------------------------
                    ____________________________________________________
      Total Personnel Comp. & Benefits..................      25,353,998
                    ========================================================
                    ____________________________________________________
Other Costs:
    Travel..............................................       1,647,529
    Transportation of things............................          82,222
    Communications, utilities, and misc. charges........         907,585
    Printing and reproduction...........................         988,641
    Advisory and assistance services....................         148,716
    Other services......................................       1,149,181
    Purchases of goods and services from Government 
      Accounts..........................................       1,041,678
    Supplies and materials..............................         460,279
    Equipment...........................................         285,972
    Interest for prompt payment.........................             414
                    --------------------------------------------------------
                    ____________________________________________________
      Total Other Costs.................................       7,712,217
                    ========================================================
                    ____________________________________________________
      Total Fiscal Year 1998 Management Costs...........      33,066,215

    Question. How does CSREES cover the indirect costs of research? 
Please provide an accounting of these costs for fiscal year 1998.
    Answer. The indirect costs of research conducted by land-grant 
universities and other recipients of CSREES funding are realized in two 
ways. First, a percentage of funds may be charged by recipients against 
competitively-awarded research grants to pay indirect costs. The 
percentage of funds that can be used to pay indirect costs is subject 
to the recipient's Federally-negotiated indirect cost rate and any 
statutory limitations on indirect cost recovery. For example, Section 
711 of the General Provisions of the fiscal year 1999 appropriations 
act, Public Law 105-277, limits the recovery of indirect costs under 
research grants awarded by CSREES to 14 percent.
    Second, indirect costs of research are borne by land-grant 
universities and other recipients under certain situations. For 
example, a recipient may elect to waive all or part of the indirect 
costs to which they are entitled so that all, or a larger portion of, 
the Federal funds provided under an award are used to support the 
direct costs of the research. In cases where indirect costs are 
statutorily limited, the recipient must use other resources to offset 
differences between allowed and actual indirect costs. There also are 
some CSREES programs under which no indirect cost recovery is allowed, 
such as earmarked Special Research Grants, and the recipient must bear 
all indirect costs of the research being conducted.
    The fiscal year 1998 funds awarded and indirect costs charged in 
those research programs allowing indirect costs are shown below:

------------------------------------------------------------------------
                                            Total Funds   Indirect Costs
                 Program                      Awarded         Charged
------------------------------------------------------------------------
Federal Administration..................      $7,833,643        $875,173
Higher Education........................       4,330,108         342,708
National Research Initiative............      50,622,574       6,493,936
Special Research Grants (competitively-        5,857,333         617,603
 awarded)...............................
                                         -------------------------------
      Totals............................      68,643,658       8,329,420
------------------------------------------------------------------------

                           competitive grants
    Question. The President's fiscal year 2000 budget for the 
Cooperative State Research, Education, and Extension Service indicates 
a shift in funding from formula and special research grants to 
competitive research. What evidence is there to support that the 
competitive process selects higher priority agriculture research of 
greater benefit to agricultural producers than research funded through 
formula or special grants?
    Answer. The Administration believes that the highest possible rate 
of return to funds allocated for agricultural research is through a 
balanced portfolio of funding for university-based agricultural 
research including formula programs, competitive grants, special grants 
and projects, and other programs such as Smith-Lever 3(d).
    The Administration, under the Agricultural Research, Extension, and 
Education Reform Act of 1998 has a statutory mandate to ensure that 
agricultural research, extension, and education activities address 
national, multi-state, or regional priorities. The Administration sets 
these priorities through on-going consultation with the National 
Research, Extension, and Education Advisory Board, the land grant 
research and extension system, and producer organizations. This 
stakeholder input process ensures that competitive grant programs meet 
national, multistate, or regional priorities. Competitive grants can 
also be a tool to address national issues which have a narrower 
regional focus. For instance, the fiscal year 2000 budget contains a 
request for $5 million to support competitive grants for Methyl Bromide 
alternatives. This program will benefit producers in very specific 
areas of the country while addressing a pressing national need. Also, 
while competitive grant program areas address broad national 
priorities, the individual proposals which are submitted and funded may 
represent issues of particular local concern.
    The Administration also believes that competitive grant programs, 
open to a broad array of scientists, will attract the best scientific 
talent to the solution of high priority agricultural problems. In fact, 
much of the best talent lies within the land grant college and 
university system. In fiscal year 1998, approximately 75 percent of 
grants funded under CSREES' National Research Initiative--NRI--went to 
institutions in the land grant system. Through competitive programs, 
such as the NRI, land grant colleges and universities receive research 
support, and taxpayers are assured that scarce funds are addressing 
problems of the highest national priority. States and localities may, 
of course, use formula fund resources, state funds, and private support 
to address the local priorities of their stakeholders, as allowed under 
the authorizing statutes for these programs.
    Question. For each of fiscal years 1997 and 1998, show who received 
funding awards through the National Research Initiative, e.g., the 
percent of funds awarded to land-grant colleges and universities, to 
the Agricultural Research Service, to other federal agencies, to state 
extension agencies, etc.
    Answer.
    [The information follows:]

                       NATIONAL RESEARCH INITIATIVE COMPETITIVE GRANTS PROGRAM GRANTS AWARDED FROM FISCAL YEARS 1997 APPROPRIATION
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Dollars      Percentage of                      Dollars      Percentage of
                                                          Grants awarded    awarded in     funds awarded  Grants awarded    awarded in     funds awarded
                 Performing organization                  in fiscal year    fiscal year   in fiscal year  in fiscal year    fiscal year   in fiscal year
                                                               1997            1997            1997            1998            1998            1998
--------------------------------------------------------------------------------------------------------------------------------------------------------
Individual..............................................               8        $705,000               1               2        $171,000               1
1862 Land-Grant Universities (includes SAES)............             411      51,045,252              69              71       9,736,473              77
1890 Land-Grant Universities............................               1          49,772         ( \1\ )  ..............  ..............  ..............
Other...................................................               2         357,000         ( \1\ )  ..............  ..............  ..............
Private Non-Profit......................................              26       3,070,500               4               5         443,800               4
Private Profit..........................................               2         280,000         ( \1\ )  ..............  ..............  ..............
Private Universities....................................              39       5,000,054               7               7         498,583               4
Public Universities.....................................              76       8,367,660              11              16       1,114,292               9
State/Local Government..................................  ..............  ..............  ..............  ..............  ..............  ..............
Agricultural Research Service...........................              20       2,841,679               4               2         260,000               2
Forest Service..........................................               5         471,870               1               2         148,500               1
Veterinary Schools and College..........................              13       1,859,298               3               2         300,000               2
1994 Institutions.......................................  ..............  ..............  ..............  ..............  ..............  ..............
Hispanic Serving Institutions...........................  ..............  ..............  ..............  ..............  ..............  ..............
                                                         -----------------------------------------------------------------------------------------------
      TOTAL.............................................             603      74,048,085             100             107      12,672,648             100
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Less than 1 percent.


                       NATIONAL RESEARCH INITIATIVE COMPETITIVE GRANTS PROGRAM GRANTS AWARDED FROM FISCAL YEARS 1998 APPROPRIATION
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Dollars      Percentage of                      Dollars      Percentage of
                                                          Grants awarded    awarded in     funds awarded  Grants awarded    awarded in     funds awarded
                 Performing organization                  in fiscal year    fiscal year   in fiscal year  in fiscal year    fiscal year   in fiscal year
                                                               1997            1997            1997            1998            1998            1998
--------------------------------------------------------------------------------------------------------------------------------------------------------
Individual..............................................               1         $85,000         ( \1\ )  ..............  ..............  ..............
1862 Land-Grant Universities (includes SAES)............             304      39,483,187              78             207     $26,948,373              72
1890 Land-Grant Universities............................  ..............  ..............  ..............               1          49,493         ( \1\ )
Other...................................................               1          14,000         ( \1\ )  ..............  ..............  ..............
Private Non-Profit......................................              22       1,410,250               3               6         939,700               3
Private Profit..........................................  ..............  ..............  ..............               1          81,820         ( \1\ )
Private Universities....................................              26       3,349,100               7              13       1,585,580               4
Public Universities.....................................              35       3,382,762               7              39       4,209,491              11
State/Local Government..................................  ..............  ..............  ..............  ..............  ..............  ..............
Agricultural Research Service...........................               6         855,000               2               8       1,519,946               4
Forest Service..........................................               1         159,329         ( \1\ )               3         201,060         ( \1\ )
Veterinary Schools and College..........................              10       1,673,946               3          \2\ 10       1,523,724               4
1994 Institutions.......................................  ..............  ..............  ..............  ..............  ..............  ..............
Hispanic Serving Institutions...........................               1          90,000         ( \1\ )  ..............  ..............  ..............
Department of Commerce..................................  ..............  ..............  ..............               1         150,000         ( \1\ )
                                                         -----------------------------------------------------------------------------------------------
      TOTAL.............................................             408      50,622,574             100             289      37,209,187             100
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Less than 1 percent.
\2\ Includes one 1890 Institution.

                      national research initiative
    Question. The fiscal year 2000 budget justification indicates a 
$43,407,663 carryover into fiscal year 1999 of funds available for the 
National Research Initiative. No carryover into fiscal year 2000 is 
estimated. What is the reason for the $43,407,663 carryover?
    Answer. The no year funding authority for the National Research 
Initiative has allowed greater flexibility in awarding grants with 
start dates that best suit the needs of the research area. Carryover 
funds largely represent grants that were reviewed in the previous 
fiscal year, but that have start dates after September 30th. Most of 
these grants will start sometime in the fall or early winter of the 
following fiscal year. Starting grants later allows investigators who 
do field work to start their investigations as necessary to take 
advantage of a summer growing season. In addition, being able to 
carryover funds from one fiscal year to the next distributes the work 
load required to administer awards more uniformly during any given 12-
month period. Without carryover, work load was concentrated during a 
short time period at the end of each fiscal year which became 
unmanageable under the heavy workload CSREES sustains (over 2000 awards 
each year). Carryover funding also provides CSREES with greater 
flexibility in funding programs and taking advantage of new research 
opportunities by offering new programs and by combining small amounts 
of funds from successive years into meaningful programs.
                         food safety initiative
    Question. The conferees on the fiscal year 1999 Appropriations Act 
directed USDA to consult with the Food and Drug Administration (FDA) 
regarding food safety objectives and recommended that $5 million of the 
food safety component of the National Research Initiative be used to 
meet those needs. What consultations with FDA occurred and what food 
safety objectives were identified? Is $5 million of the NRI food safety 
funds being reserved for this research?
    Answer. The Conference report of Oct 2, 1998, directed USDA to 
consult with the Food and Drug Administration--FDA--regarding food 
safety research objectives of that agency and recommended that $5.0 
million of the funds provided for the food safety component of the 
National Research Initiative--NRI--be used to meet those needs. In 
meeting this directive, the NRI program staff developed from 
stakeholder meetings and the National Food Safety Conference a list of 
research areas that addressed the President's Food Safety Initiative 
and supported the public health mission of Federal regulatory agencies. 
These food safety research areas were provided to, and a joint meeting 
held with, representatives from the FDA's Center for Food Safety and 
Applied Nutrition, as well as from agencies within USDA, including the 
Food Safety and Inspection Service, the Agriculture Marketing Service, 
the Office of Risk Assessment and Cost-Benefit Analysis, the Economic 
Research Service, and the Agricultural Research Service. As a result, a 
supplemental NRI program titled, Epidemiological Approaches for Food 
Safety, was developed. The program will support research in the 
following areas:( a) identification of sources and reservoirs of 
pathogenic organisms and their toxins in food, animal feed, and the 
environment; (b) determination of the levels of microbial contamination 
in finished food products; (c) identification of farm-based production 
practices that contribute to increased prevalence of foodborne 
pathogens; and (d) identification of potential sites of contamination 
in the processing, transportation, retail setting, and consumer use of 
food products. Proposals are encouraged that use collaborations and 
partnerships among institutions and bring a multidisciplinary approach 
to derive innovative approaches to solve problems. Proposals are to 
describe how research outcomes will be transferred for implementation. 
It is anticipated that some awards will be granted up to $1 million in 
fiscal year 2000. The deadline for submission of proposals was April 5, 
1999. This research will provide a better understanding of the multiple 
factors involved in food safety and provide science-based information 
for those who establish public health policy. The information from this 
research will help to better identify the sources, incidence, and 
control of disease-causing microorganisms in meats, poultry, seafood, 
fruits and vegetables, and other food products.
                      national research initiative
    Question. The prepared testimony submitted to the Committee 
indicates that the increase requested for the National Research 
Initiative (NRI) will ``enable the NRI to attract more of the best 
scientists.'' How will a funding increase do this?
    Answer. The National Research Initiative is the largest competitive 
research grants program in the USDA and is unique because all 
scientists throughout the country, regardless of where they work, are 
eligible to compete for funds. However, at current funding levels, the 
NRI is not positioned to take full advantage of the potential 
scientific expertise because inadequate funding discourages many 
excellent scientists from participating in USDA programs. Agriculture 
needs to attract the best scientists, regardless of where they work, to 
address key research problems. This is best done by competitive 
programs at adequate levels of funding. Increased funding for the NRI 
also means that additional funds would be available for agricultural 
research at small and midsized institutions and in states that 
typically are less successful in the competitive grants arena. These 
funds are provided through the NRI Strengthening Program which targets 
10 percent of total NRI funding towards small and midsized institutions 
and institutions in USDA EPSCoR states. As funds for the NRI increase, 
so do funds for the Strengthening program. Finally, substantial funding 
increases would attract beginning investigators into scientific fields 
that would benefit the agricultural system by increasing available 
funds for postdoctoral fellows and new investigators grants.
                          extension activities
Expanded Food and Nutrition Education Program (EFNEP)
    Question. Why is the Administration proposing a $2.348 million 
increase in funding for the Smith-Lever 3(d) Food and Nutrition 
Education Program for fiscal year 2000 when it proposed to cut the 
program by this same amount last year?
    Answer. In fiscal year 1999, EFNEP and other CSREES programs were 
reduced to provide the funding necessary to support Department and 
Presidential initiatives and to help eliminate the Federal deficit. In 
fiscal year 2000, the budget once again focuses on high priority 
research, education, and extension programs including the Expanded Food 
and Nutrition Education Program. EFNEP has been and continues to be 
very effective in providing low-income families information to increase 
nutritional knowledge and improve nutritional practices. The delivery 
and use of dietary information is critical to meeting the needs of the 
undernourished portion of the population, especially children. This 
multi-faceted program addresses many USDA and national goals and 
initiatives, including the President's Initiatives on Food Safety and 
Child Care.
                       farm safety and agrability
    Question. Why does the Administration propose to discontinue 
funding for the Smith-Lever 3(d) farm safety and AgrAbility programs?
    Answer. The U.S. Department of Agriculture has determined that 
alternative funds from formula programs, State and local governments, 
and private sources could be used to support aspects of this program 
deemed to be of a high priority at State and/or local levels.
                              rural health
    Question. Please give the Committee an update on the Louisiana and 
Mississippi rural health projects funded for the last several years.
    Answer. The focus of the Nurse Managed Family Health Care Center 
project being conducted by Southern University and A&M College in Baton 
Rouge, Louisiana is health promotion and disease prevention for at-risk 
populations residing in rural and inner city neighborhoods in south 
Louisiana. Quality, cost-effective, community-based primary health care 
services are being offered where graduate nurse faculty, nursing 
students, and physicians located in community health outreach centers 
assist women, children, and the elderly in understanding and utilizing 
self-care health practices.
    More than 1,300 rural and urban citizens have been served by Nurse 
Managed Clinics and the Jag Mobile, a mobile health clinic equipped 
with a laboratory, patient processing areas, pharmacy, nurse's station, 
examination rooms, and a conference room for teaching. The clients 
include senior citizens, homeless individuals and families, refugees, 
battered women, and those seeking substance abuse treatment. In 
addition, 540 children enrolled in Head Start have received health 
services.
    Services include: physical examinations; childhood vaccinations; 
and height and weight, blood pressure, and vision screenings. Health 
education is provided to participants to enhance health promotion and 
disease prevention by increasing self-care capabilities. Health 
education topics include nutrition, safety, breast self-examination, 
dental health, hypertension, and diabetes.
    During fiscal year 1997, more than 200 nursing students from 
Southern University and A&M College and 44 nursing students from 
Southeastern in Hammond utilized the Jag Mobile as a clinical 
experience. Eight nutrition education students from Southern University 
and A&M College were also assigned to the mobile unit for a clinical 
rotation. The Louisiana State Board of Nursing has granted approval for 
the Nurse Managed Clinic and the mobile unit to serve as training 
facilities for nursing students.
    The Mississippi Rural Health Corps is a collaborative effort of the 
states' 15 community and junior colleges and Mississippi State 
University Extension Service to increase the number of health care 
professionals in rural practice. Since Fiscal Year 1993, the project 
has provided student loans to nursing and allied health students who 
are willing to commit to a period of service in rural Mississippi upon 
graduation.
    Since the inception of the program, 1,499 students have graduated 
from the program. A total of 561 have completed their service 
obligation and 580 are currently completing their obligation by working 
in rural areas. In fiscal year 1998, 559 Rural Health Corp loans were 
awarded to nursing and allied health professional students enrolled in 
the community college system and 9 loans were granted to community 
college nursing faculty members to pursue advanced degrees.
    In addition, statewide health education is provided by Mississippi 
State University Extension Service. In fiscal year 1998, the major 
focus was on increasing the understanding of medical self-care, breast 
cancer prevention, tobacco avoidance, and teen postponement of sexual 
involvement. One hundred thousand women were reached with breast self 
exam training, 20,000 individuals were taught medical self-care 
techniques, and a self-care Web site was created to provide health 
education throughout the state.
    Mississippi State University Extension Service personnel form 
community based healthcare coalitions to expand the health education 
outreach. Currently, there are 18 active coalitions. During fiscal year 
1998, the coalitions conducted 52 health-related events such as health 
fairs, health screenings, and a variety of seminars and workshops.
    Last year for the first time, the Rural Medical Scholars program 
was started to interest high school students in serving as physicians 
in rural Mississippi. Twenty-eight students participated in a 5-week 
residential experience at Mississippi State University. The students 
completed two pre-med courses, ``shadowed'' physicians, and attended a 
lecture series for aspiring physicians. In fiscal year 1999, an 
additional week of training will be added. Thirty students will be 
selected for this program in fiscal year 1999.
    In fiscal year 1999, the Scholars program will also be expanded to 
include a Rural Health Explorers component for high school students 
with a more general interest in health care careers. The Explorers will 
take one course, either anatomy or physiology, tour hospitals, interact 
with health care professionals, and talk with community college 
representatives about academic requirements for health care careers. 
The goal is to have thirty students complete the Rural Health Explorers 
program in fiscal year 1999.
                            1890 facilities
    Question. What is the current demand for 1890's facilities funding? 
Is the fiscal year 1999 funding sufficient to meet project requests 
from the 1890 institutions approved by the agency?
    Answer. The availability of adequate agricultural research and 
education facilities at the 1890 Institutions currently lags far behind 
that of the 1862 institutions. There is a significant need to renovate 
buildings and to construct and equip new facilities at the 1890 
Institutions to ensure high quality training for future scientists and 
educators, the recruitment and retention of faculty, and the needed 
infrastructure for the generation and dissemination of agricultural 
research and extension knowledge.
    The fiscal year 1999 appropriation for Section 1447 is not 
sufficient to meet the project needs of the 17 institutions. The fiscal 
year 1999 funding allows an average award of less than $475,000 to each 
school. Usually a school stockpiles the funds over a period of several 
years until they have a critical mass of capital to enter into 
subcontracts for renovation or construction or to purchase equipment. 
Unfortunately, in situations such as this, the buying power of the 
funds are diminished by inflation. In addition, even after five years 
of funding at this level many schools are able to address only a 
portion of their needs.
    Question. Provide a list, by 1890 institutions, of the renovation 
and construction projects funded in each of fiscal year 1997 and 1998.
    Answer. As mentioned in the above response, projects completed in 
any one year may be funded by the accumulation of prior year funds. The 
1890 facilities follows.

                                   1980 FACILITIES PROGRAM SUMMARY OF PROGRESS
                                          [Fiscal Years 1997 and 1998]
----------------------------------------------------------------------------------------------------------------
            Institution                               1997                                  1998
----------------------------------------------------------------------------------------------------------------
Alabama A&M University, Normal,      --Complete initial structural          --Obtain modern lab equipment and
 Alabama.                             assessments and architectural          other instructional resources to
                                      renderings for the Research            support traditional and non-
                                      Extension Conference Center and the    traditional learning opportunities
                                      Food Science and Nutrition            --Renovate and construct teaching
                                      Laboratories                           and research training facilities
                                     --The Distance Learning Center is       for all program areas
                                      operative                             --Purchase state-of-the-art research
                                     --The bid materials have been           and training equipment for food and
                                      completed for the purchase of          agricultural sciences programs
                                      equipment for the farm, plant, food   --Improve the coordination among
                                      and animal biotechnology               extension, research and academic
                                      laboratories                           programs by enhancing extension
                                     --Bids have been completed for          facilities and equipment, including
                                      replacement windows in the James I.    computer networking and distance
                                      Dawson Extension Building.             education.
 
Tuskegee University, Tuskegee,       --A schematic drawing and plan of      --Renovate and upgrade Milbank Hall
 Alabama.                             work was developed and presented to    for research
                                      the University Administration for     --Upgrade the Vocation Building as
                                      the renovation of the Woodruff Food    an Extension Activity Center
                                      Processing Laboratories               --Upgrade gutters and repair
                                     --The asbestos survey was completed     Morrison-Mayberry Hall for
                                      and a report was submitted to the      extension activity.
                                      University
                                     --The decision was made to renovate
                                      the Vocational Education Building
                                      for extension work
                                     --The construction of the Caprine
                                      Research Facility has been completed
                                     --The roof for Campbell Hall has been
                                      replaced
                                     These facilities will provide updated
                                      extension, research and education
                                      initiatives in food technology and
                                      processing laboratories to conduct
                                      hands-on demonstration for youth,
                                      family and community life
                                      experiences, interdisciplinary
                                      research on ruminants, agro-
                                      forestry, food processing, food
                                      safety and quality, and
                                      environmental quality and waste
                                      management.
 
University of Arkansas, Pine Bluff,  --Purchase data processing equipment   --Improve and further develop two
 Arkansas.                           --Partially construct, furnish and      farm sites to enhance the quality
                                      equip the Extension complex            of research and outreach
                                     --Purchase farm and laboratory         --Purchase equipment to support
                                      supplies and equipment                 research, extension and instruction
                                     --Renovate farm structures             --Renovate Woodard Hall, which
                                     --Partially construct a demonstration   houses the departments of
                                      fish processing facility               Agriculture and Aquaculture
                                     --Partially construct a sheep          --Expand the child development
                                      facility.                              laboratory and playground in Adair-
                                                                             Greenhouse Hall
                                                                            --Renovate farm structures including
                                                                             the S. J. Parker Research Center,
                                                                             and a fish hatchery.
 
Delaware State University, Dover,    --Complete the construction of the     --Construct an animal handling,
 Delaware.                            greenhouse                             holding and teaching facility
                                     --Begin construction of School of      --Construct an office, laboratory
                                      Agriculture herbarium                  and classroom building to support
                                     --Construct ponds                       the research, extension and
                                     --Convert dairy barn to a small         academic programs and centralize
                                      animal lab.                            the location of two academic
                                                                             departments of the School of
                                                                             Agriculture, Natural Resources,
                                                                             Family and Consumer Sciences.
 
Florida A&M University,              --Complete construction of a facility  --Acquire land to construct a
 Tallahassee, Florida.                to house research, teaching and        facility for research, teaching and
                                      extension demonstration animals        extension aquaculture
                                     --Complete construction of             --Develop program plans and
                                      teleconference centers on campus and   specifications for a multi-purpose
                                      at the University farm site in         research, teaching and extension
                                      Quincy, Florida                        facility
                                     --Purchase furniture and equipment     --Monitor program plans for the
                                      for distance education programs        construction of the agriculture
                                     --Develop feasibility proposal for      multi-purpose research, teaching,
                                      multi purpose research and extension   and extension facility
                                      facility                              --Construct an outreach facility for
                                     --Purchase equipment for a water        youth development programs at the
                                      quality lab and a plant                farm site
                                      biotechnology lab                     --Develop environmental science
                                     --Install irrigation wells for animal   programs for workshops, seminars,
                                      and vegetable research and             conferences, and distance learning
                                      demonstration projects                 programs for rural and urban youth
                                     --Initiate plans for construction of    and families.
                                      farm shop and an equipment shed at
                                      farm site
                                     --Repair a dam and construct a dock
                                      at a two acre pond for acquaculture
                                      and environmental studies
                                     --Renovate an entomology lab for
                                      research programs.
 
Fort Valley State University, Fort   Funds for fiscal years 1996 and 1997   --Construction of a family
 Valley, Georgia.                     have not been awarded pending the      development center
                                      submission of proposals by the        --Acquisition of laboratory and
                                      University. However, the objectives    demonstration equipment.
                                      of the grant for the fiscal years
                                      1993-1995 were for construction of a
                                      small ruminant research and
                                      extension center; a research,
                                      extension education support center;
                                      and a research, extension human
                                      development and family life center.
 
Kentucky State University,           --Repair roof, replace boiler, and     --Design, develop, and select a site
 Frankfort, Ken-  tucky.              complete the horticulture and          for a research, extension and
                                      entomology labs in the Atwood          teaching aquaculture field station
                                      Research Facility                      to expand the aquaculture program.
                                     --Purchase and install
                                      telecommunication and interactive
                                      video conferencing equipment in the
                                      extension building
                                     --Complete parking lot
                                     --Complete plumbing and electrical
                                      upgrades for the greenhouse
                                     --Initiate pond repair.
 
Southern University and A&M          --Purchase and install equipment       --Upgrade equipment in Fisher Hall
 College, Baton Rouge, Louisiana.     including animal pens, electronic      to establish a state-of-the-art
                                      timers, portable bleachers, portable   computer-assisted and multimedia
                                      panels, poultry coops                  instruction facility
                                     --Purchase a small vehicle             --Equip a Small Farm Family Resource
                                     --Purchase fire and sound evacuation,   Development Center
                                      security and monitoring systems for   --Complete the Multi-purpose
                                      the Multi-purpose Livestock Show       Livestock Show Arena.
                                      Arena.
 
University of Maryland Eastern       --Design, plan, and construct the      --Site planning and design of the
 Shore, Princess Anne, Maryland.      Food Science and Technology Research   Plant Science Teaching and Research
                                      and Extension Center                   Center and an Ag Tech Center
                                     --Renovate the Lifespan Human          --Renovate the interactive teaching
                                      Development Center.                    lab for the early childhood
                                                                             education program
                                                                            --Purchase equipment for research
                                                                             and teaching programs.
 
Alcorn State University, Lorman, MS  --Construct multi-purpose building     University is preparing a proposal
                                     --Renovate research facilities.         for fiscal year 1998 funds.
 
Lincoln University, Jefferson City,  --Completed Phase 11 construction of   --Construct greenhouse/propagation
 Missouri.                            Allen and Foster Halls for extension   facility for research and teaching
                                      and research                           programs
                                     --Review plans and specifications for  --Construct farm equipment/hay
                                      the beef cattle/sheep handling         storage facility and mobile
                                      facilities, storage facility,          residence for research, teaching,
                                      vehicle storage facility, greenhouse   and extension programs
                                      and irrigation unit, and multi-
                                      purpose building.
 
North Carolina A&T State             --Continue renovation and              --Wire and connect offices and
 University, Greensboro, North        construction on Coltrane Hall for      classrooms for teaching to fiber
 Carolina.                            extension                              optic network in Benbow Hall,
                                     --Initiate planning and construction    Carver Hall, C. H. Moore Ag
                                      of the Extension/Research Office       Research Facility, Webb Hall, and
                                      Building                               Coltrane Hall
                                     --Initiate planning for renovation/    --Upgrade equipment for School of Ag-
                                      conversion of Farm Barn                IV Studio
                                     --Renovate Ward Hall for research      --Upgrade computer network equipment
                                     --Renovate Analytical and Food/         and purchase computers for Benbow
                                      Nutrition Labs                         Hall for research
                                     --Purchase scientific equipment.       --Purchase scientific equipment for
                                                                             Analytical Services Laboratory for
                                                                             research
                                                                            --Purchase teleconferencing
                                                                             equipment for Coltrane Hall for
                                                                             extension
 
Langston University, Langston,       --Construct/renovate Extension/        --Construct/renovate Research/
 Oklahoma.                            Research Complex.                      Extension Building
                                                                            --Construct/renovate greenhouse
                                                                            --Construct new facility to house
                                                                             teaching, research and extension
                                                                             programs
 
South Carolina State University,     --Continue renovation/repair on        --Complete construction on Extension
 Orangeburg, South Carolina.          residential youth camp                 Office Complex
                                     --Continue construction on Distant     --Construct/Renovate Commercial
                                      Learning                               Foodservice Management Laboratory
                                     --Purchase equipment for Extension     Renovate R. L. Hurst Research Center
                                      Office Complex.                       Renovate Staley Hall for teaching
 
Tennessee State University           --Construct a research and extension   --Develop a comprehensive distance
 Nashville, Tennessee.                facility.                              learning studio
                                                                            --Renovate/construct teaching
                                                                             learning center
 
Prairie View A&M University,         --Purchased some of the equipment      --Continue to purchase equipment and
 Prairie View, Texas.                 needed for the Cooperative             vehicles for the CARC
                                      Agricultural Research Center (CARC)   --Continue to construct H.S. Estelle
                                     --Construct/renovate H.S. Estelle 4-H   4-H and Youth Camp
                                      and Youth Camp                        --Purchase equipment for
                                     --Renovate dairy goat center,           Communications Network
                                      creamery laboratory, meat             --Continue renovations for dairy
                                      laboratory, greenhouse, swine          goat center, creamery laboratory,
                                      center, feed mill, poultry center,     meat laboratory, greenhouse, swine
                                      and human nutrition/food science       center, feed mill, poultry center,
                                      laboratories.                          human nutrition/food science
                                                                             laboratories
                                                                            --Renovate Carden-Waller Extension
                                                                             Building
                                                                            --Renovate Jesse H. & Mary Gibbs
                                                                             Jones Building, calf/hay barn, and
                                                                             farm operations for research
                                                                            --Renovate teaching labs
                                                                            --Plan and construct Family
                                                                             Development Research/Extension
                                                                             Center
                                                                            --Construction addition to
                                                                             Cooperative Extension Office and
                                                                             Training Facility; multi purpose
                                                                             pavilion; and Animal Systems
                                                                             Building
                                                                            --Install access gates to Extension
                                                                             parking lots
                                                                            --Construct greenhouse for research
 
Virginia State University,           --Purchase equipment for plant         --Complete purchase of equipment for
 Petersburg, Vir-  ginia.             science and aquaculture research       Desktop Publishing and Reference
                                      labs                                   Center
                                     --Purchase equipment for distant       --Complete renovations on Animal
                                      education capability in new            Science Teaching Laboratory
                                      extension building                    --Renovate former sheep facility to
                                     --Construct/renovate Poultry Building   office and storage facility
                                     --Construct/renovate Pole Barn
                                      Building
                                     --Construct greenhouse (Phase 1)
                                     --Construct service building on
                                      Randolph Farm.
----------------------------------------------------------------------------------------------------------------

                       1994 institutions funding
    Question. Is there a need for facilities funding for the 1994 
institutions? How does the fiscal year 2000 budget address this need?
    Answer. There is a significant need for facilities funding for the 
thirty 1994 land grant institutions. Current facilities do not place 
these institutions in a strong position to address broad research, 
education and extension issues related to the food and agricultural 
sciences which are important to the communities and students served by 
these institutions. Of critical need is funding for research 
facilities. Such funding would enhance the utilization of funds 
currently appropriated through the U.S. Department of Agriculture, 
Cooperative State Research, Education, and Extension Service for higher 
education and cooperative extension programs, and anticipated research 
program funding proposed in the President's fiscal year 2000 budget. 
Facilities grants to these institutions would be useful to assist in 
the purchase of equipment and land, and the planning, construction, 
alteration or renovation of buildings to strengthen their capacity to 
conduct research in the food and agricultural sciences and the delivery 
of relevant research-based information through cooperative extension 
programs. In the fiscal year 2000 budget there are no funds to address 
facilities funding for the 1994 institutions.
                      extension indian reservation
    Question. The fiscal year 2000 request proposes an increase of 
$3,286,000 for the Extension Indian Reservation Program. Which Indian 
reservations currently have an extension agent, and which Indian 
Reservations will receive an agent if the budget request is approved?
    Answer. We currently have Extension agents on 25 reservations in 15 
states. These include Alaska--Tanana Chiefs' Conference; Arizona--
Navajo Reservation, Ship Rock and Window Rock, San Carlos Apache 
Reservation, Colorado River Indian Tribes Reservation, and Hopi 
Reservation; Florida--Seminole Reservation; Idaho--Fort Hall 
Reservation; Mississippi--Choctaw Reservation; Montana--Flathead 
Reservation, Northern Cheyenne Reservation, Blackfeet Reservation, and 
the Fort Belknap Reservation; North Carolina--Cherokee Reservation; 
North Dakota--Fort Berthold Reservation; New Mexico--Jicarilla Apache 
Reservation and the Zuni Reservation; Nevada--Nevada Indian 
Reservations; Oklahoma--Muscogee (Creek) Nation; Oregon--Warm Springs 
Reservation; South Dakota--Pine Ridge Reservation and the Rosebud 
Reservation; Washington--Chehalis Reservation and the Colville 
Reservation; and Wyoming--Wind River Reservation.
    We also have previously submitted applications from Alaska--
Kenaitze Nation; Arizona--Navajo Reservation at Crown Point, Tuba City, 
Chin Le, and Kayenta; and the Hualapai and Havasupai Reservations; 
Colorado--the Southern Ute Reservation and the Ute Mountain 
Reservation; Idaho--the Fort Hall Reservation; Kansas--the Kickapoo 
Nation; Montana--the Crow Reservation and the Rocky Boy's Reservation; 
North Dakota--the Fort Totten Reservation, the Standing Rock 
Reservation, and the Turtle Mountain Reservation; New York--the St. 
Regis Mohawk Reservation; Rhode Island--the Narragansett Nation; and 
South Dakota--the Cheyenne River Reservation. These have not been 
funded, nor have they been recently updated. We anticipate new 
applications from each of these, should the increase be provided.
    We have had recent inquiries from the Menominee Nation--Wisconsin; 
the Cherokee Nation--Oklahoma; the Tohono O'odham, Gila River, and 
White Mountain Apache Reservations--Arizona; and the Couer D'Alene 
Reservation-- Idaho.
    If the increase is enacted, we expect to receive applications, or 
new applications, from most of the locations listed above and from more 
Reservations in Idaho, New Mexico, Texas, Utah, Wisconsin, and 
Washington.
                         integrated activities
    Question. The Administration proposes first-time funding of $73 
million for an integrated research, education, and extension 
competitive grants program, as authorized by the Agricultural Research, 
Extension, and Education Reform Act of 1998. Does the authorization 
require that a separate appropriations account be created for these 
integrated activities?
    Answer. Section 406 of the Agricultural Research, Extension, and 
Education Reform Act of 1998 authorizes an integrated research, 
education, and extension competitive grants program, but it does not 
require that a separate appropriations account be created. The account 
implements authorizing legislation to break down the artificial barrier 
between research and education and extension, as well as to include 
initiatives. The Administration is proposing that the new account be 
created to enable the agency to more efficiently manage existing 
parallel research and extension programs authorized and administered 
under separate legislative authorities and separate appropriation 
accounts, as well as new programs that promote integrated approaches to 
problem-solving. This is not the first year that some of the programs 
in this account have been funded. Water quality, food safety, and 
pesticide impact assessment were funded under the Special Research 
grants and Smith Lever 3(d) programs in previous years. Fiscal year 
1999 level was $30 million.
    Question. Is the Department providing fiscal year 1999 funding for 
integrated activities? If so, please explain.
    Answer. The integrated research, education, and extension 
competitive grants program is not being implemented in fiscal year 
1999. However, as it has for the past several years, CSREES will manage 
the fiscal year 1999 Special Research Grants and Smith-Lever 3(d) 
funding for the National Pesticide Impact Assessment Program so that 
single proposals addressing research and extension issues are submitted 
by the States to the agency for review and award. This approach has 
significantly streamlined the submission, review, and award process. 
Because of the separate authorizations and appropriations accounts, we 
have continued to track obligations separately.
    Question. How has the Department determined which programs should 
be funded under a new integrated authorities account?
    Answer. CSREES, which resulted from the 1994 merger of the former 
Cooperative State Research Service and the former Extension Service, 
has previously administered parallel research and extension programs in 
several areas, including the Water Quality, National Agricultural 
Pesticide Impact Assessment, and Food Safety programs. These programs 
were administered under the separate legislative authorities for 
Special Research Grants and Smith-Lever 3(d), and the use of funds 
awarded under these programs was limited to only research activities or 
only extension activities. The agency determined that it would be 
appropriate to include these parallel programs, as well as new programs 
promoting integrated approaches to problem-solving, in the new account 
so that research, extension, and education activities can be fully 
integrated without the artificial barriers resulting from separate 
legislative authorities. The integrated authorities account will enable 
the agency to more efficiently manage these programs by streamlining 
the proposal submission, review, and award processes.
                              farm*a*syst
    Question. Please give us a status report on the Farm*A*Syst funded 
through the Water Quality grant program and the level of funding 
provided for this program for each of fiscal years 1997, 1998, and 
1999.
    Answer. Farm*A*Syst has now spread to 47 states, plus Puerto Rico 
and the Virgin Islands. More than 80,000 assessments have been 
conducted since the program began. Nineteen of these states raised a 
total of over $1.1 million in matching funds. An additional $55 million 
in private citizen funding has been invested in pollution prevention 
measures due to Farm*A*Syst findings. One study in Nebraska showed that 
farmers spent an average of $5,400 each in renovations to protect water 
supplies. In addition to general farm assessments, the program is 
evolving into commodity-specific assessments such as new pilot 
assessments in cotton, potatoes, dairy, and beef. In Mississippi, more 
than 2,000 properties have been assessed; and over 10,000 youth have 
been trained in simple assessments. The Delta Council FARM group uses 
materials in their environmental stewardship program. California has 
certified over 900 dairy farms to date with this program. In Michigan, 
farmers receive a 20 percent insurance premium reduction for 
implementing assessment and prevention measures. Several states used 
trained volunteers to deliver the program.
    For rural homeowners without major agriculture, the Home-A-Syst 
program was developed. This program addresses issues such as rural well 
and septic maintenance and hazardous waste. This program is now in 31 
states; and booklets are in the third printing after distribution of 
26,000 copies. Half of these states have raised a total of $510,000 in 
matching funds.
    Funding for fiscal year 1997 was $197,977; fiscal year 1998 was 
$148,483; and fiscal year 1999 is planned for $111,362 to the national 
coordinating staff in Wisconsin. An additional $497,000 is available in 
fiscal year 1999 for competitive grants to states to strengthen their 
programs.
     food quality protection act risk mitigation and crops at risk
    Question. Please explain how the proposed Food Quality Protection 
Act (FQPA) Risk Mitigation and Crops at Risk programs will help 
producers meet requirements of FQPA. Which FQPA requirements? Who would 
be eligible for these programs? Provide some specific examples of the 
activities to be carried out through these programs.
    Answer. The new Crops At Risk (CAR) from FQPA Implementation 
program is requesting $5.0 million for fiscal year 2000. Many crops and 
cropping systems face potentially severe economic constraints as a 
result of the impending loss of certain pesticides through 
implementation of the Food Quality Protection Act (FQPA). In the short 
term, these are mainly small-acreage fruit and vegetable crops due to 
the current elimination or restrictions on organophosphate and 
carbamate pesticides. However, slightly further down the road, many 
more crops, including the large-acreage grain, forage and fiber crops 
will be impacted as well. The Crops At Risk (CAR) program is an 
intermediate-term research and implementation program designed to keep 
the crop or cropping system as the focal point. The goal of this 
program is to design and promote the development of new Integrated Pest 
Management (IPM) strategies to assist producers transition to new 
technologies necessitated by FQPA implementation. Crop Profiles, which 
are being developed through the leadership of the Office of Pest 
Management Policy (OPMP) will be used to prioritize a list of crops 
potentially at risk within each state as a result of FQPA 
implementation. State priorities will then be assessed at the regional 
level to identify crosscutting challenges and opportunities for multi-
state and multi-regional cooperation. The resulting reports will serve 
as the basis for priority setting for this competitive research grants 
program to be coordinated through CSREES in consultation with OPMP.
    The funding mechanism, for the Crops at Risk program, will involve 
the awarding of competitive grants whose merit has been determined 
following a relevancy and scientific peer review process. The request 
for proposals will be developed to attract innovative applications for 
projects that demonstrate integrated research, education and extension 
activities.
                       food recovery and gleaning
    Question. A new Food Recovery and Gleaning Community Infrastructure 
Grants Program is proposed to be funded for fiscal year 2000 as an 
integrated activity. The budget justification indicates that $10 
million is proposed to be awarded to support infrastructure projects; 
$2,850,000 in Smith-Lever 3(d) funding is to be awarded to establish a 
technical assistance and education network to help coordinate gleaning 
activities, establish local hunger programs, and administer food 
recovery programs; and $2,150,000 is to establish a competitive food 
recovery and gleaning competitive grants program. For fiscal year 1999, 
the President proposed that a Food Recovery and Gleaning program be 
managed and overseen by USDA's Food and Nutrition Service. Why is the 
President now proposing that this be a CSREES activity?
    Answer. The Secretary has determined that CSREES should be the lead 
USDA agency on food recovery and gleaning grants for a number of 
reasons:
  --CSREES is the USDA agency with the most significant previous hands-
        on experience giving grants to food recovery and gleaning and 
        related activities (through the Fund for Rural America), as 
        well as the USDA agency with the greatest expertise overall in 
        giving grants to grass-roots activities.
  --There are numerous CSREES-related food recovery and gleaning 
        projects sponsored by state and local extension services which 
        have proven track records of success in efficiently feeding 
        hungry people, utilizing volunteers, and empowering 
        communities.
  --The CSREES-affiliated Cooperative Extension System has a unique 
        ability to help serve isolated rural areas, which are currently 
        under served by nonprofit feeding groups.
  --Tying such grants to the Cooperative Extension System will help the 
        effort fully utilize the expertise of universities and county 
        offices, as well as increase hunger-related volunteer 
        activities through the 4-H Program.
  --It is desirable to better integrate food recovery and gleaning 
        projects with Community Food Projects grants, which are 
        currently awarded by CSREES, as well as to place the Food 
        Recovery and Gleaning Initiative in the same overall USDA 
        mission area as the overall Community Food Security Initiative.
    Question. Please explain the need for a separate food recovery and 
gleaning competitive grants program, and why such grants can't be 
funded through the Department's other competitive research programs?
    Answer. The food recovery and gleaning grants would go mostly to 
infrastructure improvements and extension activities that directly feed 
people and help people better utilize the food provided. Most of these 
activities would not qualify as research activities that could be 
funded under research programs.
    In previous years USDA had limited ability to provide small grants 
for food recovery and gleaning activities through both the AmeriCorps 
National Service Program and the Fund for Rural America (FRA). Because 
the USDA AmeriCorps program has been eliminated and the fiscal year 
1999 Agriculture Appropriations Act prevents USDA from using funds to 
administer the FRA, USDA can no longer use those avenues to fund such 
efforts. The Department has been able, over the last few years, to 
provide some publicity and technical assistance to food recovery and 
gleaning projects, but USDA currently lacks the ability to provide 
significant financial resources to help local efforts to directly 
expand their infrastructure to recover, glean, and distribute excess 
foods. The $15 million grant program would provide significant aid to 
hard-pressed nonprofit feeding organizations throughout the country, 
many of whom now report that they are unable to keep up with large-
scale, recent increases in demand for supplemental and emergency food.
    A 1998 study by the Second Harvest Food Bank Network indicated that 
over 21 million Americans obtain supplemental and emergency food from 
food pantries and hot meal programs, most of which are run by faith-
based nonprofit groups. Most of these groups have recently reported 
that they have experienced dramatic increases in demand for food--
especially from families with children and/or families in which one or 
more adults are working. These groups have also reported that they have 
been generally unable to collect enough additional food to meet the 
rising need of their clients.
    Existing USDA food recovery and gleaning efforts have certainly 
been helpful. However, we know that--because local efforts often lack 
the appropriate equipment and processes for collecting, transporting, 
heating, refrigerating, packaging, processing, and distributing the 
food, nonprofit groups and other local entities are often unable to 
fully utilize USDA technical assistance and publicity to expand their 
efforts. Such groups and entities repeatedly inform USDA that they need 
monetary assistance to buy those pieces of equipment and build those 
processes.
    Due to this lack of local infrastructure--even though food can be 
safely recovered from farms, ranches, orchards, manufacturing and 
processing plants, wholesale and retail markets, restaurants and food 
service operations--an estimated 96 billion pounds of the 356 billion 
pounds of food produced for human consumption in America continues to 
be wasted. By providing limited Federal funds to leverage community-
based efforts to recover, glean, and distribute such food, hundreds of 
millions of pounds of additional, wholesome food can be distributed to 
hungry Americans each year.
    It is clear that community organizations (including faith-based 
organizations) are willing to bring significant resources of their own 
to aid food recovery and gleaning efforts and community volunteers are 
able and willing to provide free labor to such efforts. Yet these 
organizations still require some help from the Federal government--as 
well as from state and local governments, foundations, and private 
businesses. Federal assistance is needed to provide seed money and 
leverage other resources.
    Question. Please distinguish between activities eligible for 
funding through the Department's Commodity Assistance Program and those 
which would be undertaken this through this new grant.
    Answer. Most of the funds ($45 million) currently available to 
states for the administration of the Emergency Food Assistance Program 
(TEFAP) are used to transport and otherwise handle USDA commodities 
distributed through TEFAP. The remainder of the funding is usually used 
by states to support the transport and handling of donated food already 
moving through the emergency feeding system. Thus, states have very 
limited ability to use such funds to help non-profit and often 
community-based, faith-based organizations substantially improve their 
infrastructure to obtain and use new sources of food.
    Furthermore, food banks and their member agencies throughout the 
country are currently reporting that they are facing dramatic increases 
in request for food--particularly from working poor families--and that 
they are frequently unable to provide the additional food needed to 
meet the additional demand. In addition, food banks and their member 
agencies are facing great difficulty making up the 10 percent cut in 
fiscal year 1999 in TEFAP appropriations. For this reason, the 
Administration has proposed returning funding for TEFAP food purchases 
to the fiscal year 1998 level of $100 million, as well as proposing an 
additional $15 million in funding to help such agencies develop and 
support the channels necessary to obtain and distribute large-scale new 
sources of donated food.
    Question. What types of nonprofit organizations will be eligible 
for the $10 million ``infrastructure'' component of this program and 
please give examples of the types of ``infrastructure'' projects which 
would be eligible for funding and the need to provide federal support 
for these projects.
    Answer. Any non-profit organization, including faith-based, 
community-based, as described in section 501(c) (3) of title 26, United 
States Code; state governments; local government agencies (including 
school districts), and Indian tribal governments would be eligible to 
receive the grants.
    The following of some of the ``infrastructure'' items that could be 
funded by the grants:
  --equipment and supplies to harvest, collect, sort, process, store, 
        dehydrate, preserve, transport, and distribute recovered and 
        gleaned food;
  --infrastructure additions needed to start or expand programs that 
        combine food recovery with job training.
  --preparation and distribution of handbooks, resource guides, and 
        instructional materials (including materials to help persons 
        use recovered food safely, nutritiously, and cost effectively);
  --equipment, programs, and systems (including integrated 
        transportation systems) to improve operations and integration 
        of food recovery and gleaning efforts;
    Funds provided through the grants would only be used to start new 
activities or expand or improve existing activities; funds would not 
replace funding for existing activities. Federal assistance would be 
used in conjunction with private, non-profit, and State funds to 
empower community-based food recovery and gleaning efforts and 
encourage community volunteerism, as well as to increase ties to 
broader community food security activities.
    Preferences would be given to applicants based on the following 
criteria:
  --the offer of non-Federal matching funds in excess of the match 
        required; the cost-effectiveness of the project; the 
        effectiveness of similar projects operated by the eligible 
        grantee;
  --the socio-economic composition of the population to be served by 
        the project;
  --the extent to which the project promotes the self-sufficiency of 
        communities and food recipients, utilizes sweat equity to help 
        individuals collect their own food, increases the dignity of 
        food recipients, and helps individuals train for eventual paid 
        employment;
  --the extent to which the project includes partnerships with other 
        private or public entities involved with other community food 
        security activities; and
  --the extent to which the project will directly affect an area that 
        is designed as an empowerment zone or enterprise community.
                              farm*a*syst
    Question. Will the Administration's proposal to provide water 
quality funding through the integrated activities program affect the 
Farm*A*Syst program?
    Answer. It is anticipated that the Farm*A*Syst program will not be 
affected by the Administration's proposal to provide water quality 
funding through the integrated activities program. The integrated 
activities program is expected to maintain and strengthen existing 
National initiatives, such as the Farm*A*Syst program, by ensuring that 
the knowledge and technology generated by research is delivered to the 
end-users, including producers, communities, and consumers.
                             methyl bromide
    Question. The fiscal year 2000 budget proposes $5 million under the 
integrated activities program for a Methyl Bromide Transitions Program. 
The budget justification indicates that the ARS is focusing on long-
term methyl bromide replacement strategies, this program will focus on 
short-and intermediate-term solutions. How much of the funding proposed 
for this program will be for research? Why not expand or reorient the 
ARS program rather than begin a new research program?
    Answer. The new funding in the proposed Methyl Bromide Transitions 
Program would be available to research projects, research and extension 
combined projects, and extension projects through a competitive grants 
program that would be made available to land-grant and other 
universities, extension programs, and other research facilities that 
normally compete through the USDA-CSREES competitive grants programs. 
Each category--research , research and extension, and extension-would 
receive approximately one-third of the funding. Much of the pre-plant 
methyl bromide alternative research in ARS has focused on fresh market 
tomato and strawberries. The CSREES competitive grants program would 
focus on integrated approaches that include: 1) increased support for 
minor use chemicals on commodities, such as lettuce, pepper, other 
vegetables; 2) increased integrated research and extension activities 
on alternatives for ornamentals; 3) increase opportunities for field 
testing of integrated approaches for strawberry and fresh market 
tomato; 4) extension activities on implementation of alternatives; and 
5) increased technology transfer of results to growers through 
education programs. The use of the competitive process would assure 
that new research activities were complementary to ARS and met the 
needs of industry.
    Question. The budget justification indicates that technology 
transfer of research into practical management alternatives for methyl 
bromide will be done through cooperative extension activities. How much 
of the request $5 million is for these activities? What research 
findings will be transferred to users?
    Answer. Cooperative Extension and Education activities would 
receive approximately one-third of the proposed funding. These 
activities would more rapidly promote technology transfer from ARS and 
support new alternative programs by expanding field testing of 
integrated approaches, implementation of successful alternatives now 
available, and provide more demonstration of alternatives to growers. 
This would include tomato and strawberry but focus on other vegetables 
and ornamentals that are dependent on methyl bromide. ARS sponsors 
field-scale validations of the most promising alternatives identified 
in experimental plots. Parallel programs are proceeding in Florida and 
California ($250,000 each annually) with emphasis on tomatoes in 
Florida and strawberries in California. Research teams that include ARS 
and university scientists, extension personnel, and grower 
representatives meet periodically to evaluate research results and plan 
future trails. To help transfer the technology to growers, many of the 
field-scale validations are done with active grower participation on 
commercial farms. Such alternatives are being tested at seven 
strawberry sites in California, scattered from just north of San Diego 
to Watsonsville and with one site in the Central Valley, to test 
alternatives under a range of growing conditions. There are five sites 
devoted to perennials, in Florida, there are five sites each for 
tomatoes and strawberries. $50,000 of the Florida funds supports 
extension efforts to facilitate adoption of alternatives.
                              small farms
    Question. Please explain in more detail the need for the small 
farms programs proposed in the budget and why these needs aren't being 
met through the Department's existing rural development; natural 
resources and environment; farm assistance programs; and research, 
education and extension programs.
    Answer. The National Commission on Smalls 1998 Report, A Time to 
Act, provides an excellent description of the plight of the Nation's 
small farmers and makes a compelling case for immediate, effective 
action on the part of USDA, its Land Grant partners, and other public 
and private sector organizations and groups who work with farmers. 
There are many reasons why the Cooperative State Research, Education, 
and Extension Service (CSREES) and its Land Grant partners need to 
develop and deliver programs that will stop the erosion of the Nation's 
small farms. A few of the most important are: (1) Small farms often 
lead the way in new product development, (2) Small farms enhance the 
quality of life for all Americans and protect natural resources for the 
entire Nation, (3) Small farms also enhance the quality of life for 
urban communities, and (4) Small farms protect resources that serve all 
Americans.
    Small farmers also have special and varied needs and the National 
Small Farm Program must address those needs. Small farms are highly 
varied in size, mix of animal and plant enterprises, gate receipts and 
gender and cultural background of the farm operator. A few examples 
will illustrate the complexity of the small farm population and its 
needs.
    Small farms produce an enormous range of products and many of them 
are products for which the existing research base is not well 
developed. Organic production provides one example. Relatively little 
research-based information is available for organic producers.
    Small farms are not unsuccessful large farms. Small farmers are 
resourceful entrepreneurs who produce valuable agricultural products 
using more limited fiscal, human and land resources that their larger 
scale neighbors. They have special research, education and extension 
needs because they have fewer resources available to them than larger 
farms.
    Small farms differ widely from state to state and even within the 
same state. Small farmers include many different cultural and social 
groups. For example, language can be a barrier for some, and these 
groups need information available to them in their own languages. Some 
small farmers have limited educational backgrounds. They also have 
special information needs. Education and extension programs must 
address these multiple groups of clients.
    In general, the special and varied needs of small farmers have not 
been met because the majority of resources of the Nation's agricultural 
system have for several decades been increasingly devoted to research, 
development, assistance, and education/extension programs which have 
led to greater industrialization of the agricultural sector. While 
industrialization has certainly resulted in enormous gains and benefits 
for our food and fiber system, the small farmers, now representing 94 
percent of all farms and receiving 41 percent of all agricultural 
receipts, contribute immensely to our Nation's food production and are 
the foundation of our Nation.
    Question. The budget justification indicates that the $4 million 
requested for the small farms program will enable CSREES to reach the 
three goals of the National Small Farm Program ``much more rapidly''. 
Please explain how these goals are currently being met by CSREES and 
how the proposed farm program will expedite the agency's ability to 
meet these goals.
    Answer. There are three principal goals for the National Small Farm 
Program. They are based on the goals for the CSREES National Plan for 
Small Farms and reflect many of the primary concerns raised in the 
National Commission on Small Farms report, A Time to Act.
    The goals are to enhance the economic viability of small farms, to 
improve the contribution of small farms to environmental quality, and 
to enrich the quality of life for small farm families. These goals are 
currently being addressed through CSREES National Small Farm Program, a 
program which currently relies on formula funding and programs at the 
1862 and 1890 Land Grant Institutions. Programs at these institutions 
tend to be quite small, usually supporting professionals part-time to 
meet the needs of the small farmer communities.
    The Small Farms Initiative proposed for fiscal year 2000 will 
substantially improve education and outreach for small farmers. The 
priority programs that need to be developed are: appropriate production 
practices, marketing strategies, consumer awareness, entrepreneurial 
skills, communication and information networks, and helping beginning 
farmers establish viable farm operations and enterprises.
                                 ______
                                 
                  Questions Submitted by Senator Burns
                        fiscal year 2000 budget
    Question. Funding for Research and Education Activities are vitally 
important to enhance university curriculums and to increase 
opportunities for agricultural producers on new cropping methods, 
marketing methods, new information in the industry and ways to increase 
efficiency. How will USDA restore the $2.5 million cut in order to give 
agricultural producers an extra edge with today's depressed prices?
    Answer. Following extensive consultation with stakeholders, 
including the National Agricultural Research, Education, Extension, and 
Economics Advisory Board, the land-grant university system, and 
producer representatives, the Administration developed a portfolio of 
national agricultural research, extension, and education priorities for 
fiscal year 2000, including food safety, methyl bromide alternatives, 
small farms, Food Quality Protection Act implementation, and water 
quality. States and localities may still choose to address issues of 
immediate state and local concern as identified through their own 
stakeholder input process. Since States are free to use formula funds 
in the manner they choose, the impact of the reduction in the CSREES 
Research and Education Activities account will vary from state to 
state. Overall, the Administration is proposing an increase of 2.6 
percent in the CSREES discretionary budget, and an additional 
$152,500,000 in mandatory funding, for high priority research, 
education, and extension programs that will significantly expand and 
strengthen the knowledge of agriculture in the United States.
    Question. Funding for Extension Activities is vitally important for 
rural areas. Extension agents and programs provided by county extension 
of flee provide support and education to farming and ranching 
communities. How will USDA restore the $16.2 million cut from the 
budget?
    Answer. Following extensive consultation with stakeholders, 
including the National Agricultural Research, Education, Extension, and 
Economics Advisory Board, the land-grant university system, and 
producer representatives, the Administration developed a portfolio of 
national agricultural research, extension, and education priorities for 
fiscal year 2000, including food safety, methyl bromide alternatives, 
small farms, Food Quality Protection Act implementation, and water 
quality. States and localities may still choose to address issues of 
immediate state and local concern as identified through their own 
stakeholder input process. Since States are free to use formula funds 
in the manner they choose, the impact of the reduction in the CSREES 
Extension Activities account will vary from state to state. Overall, 
the Administration is proposing an increase of 2.6 percent in the 
CSREES discretionary budget, and an additional $152,500,000 in 
mandatory funding, for high priority research, education, and extension 
programs that will significantly expand and strengthen the knowledge of 
agriculture in the United States.
                                 ______
                                 

                       Farm Credit Administration

                 Questions Submitted by Senator Cochran
                              competition
    Question. The Philosophy Statement on Intra-System Competition 
adopted by the Board last July affirms the Board's belief that 
competition within the System is beneficial for the customer. Will all 
of the institutions be able to lend across geographic boundaries on 
both short-term loans and long-term loans or will there be any 
regulations from one lending institution to another where the 
institutions will not be equal in all aspects?
    Answer. The Farm Credit Administration (FCA or Agency) Board's 
philosophy statement expresses support for:
  --Farm Credit System (FCS or System) customers being able to choose 
        the System lender with which they want to do business. We call 
        this ``customer choice.''
  --Each System direct lender being able to offer all financial 
        services authorized by the Farm Credit Act (Act). We call this 
        ``cross-title lending.''
  --Each association being able to choose the System bank from which it 
        will be funded. We call this ``funding choice.''
    In November of last year, we published the proposed Customer Choice 
Rule, which would allow all institutions to lend across geographic 
boundaries. If the Board adopts that rule substantially as proposed, 
every association would be able to make a loan to any customer at the 
customer's choice. In this respect, all associations would be treated 
the same.
    This proposed rule would not change the types of loans an 
association can make. Federal Land Bank Associations (FLBAs) and 
Federal Land Credit Associations (FLCAs) could still make only long-
term mortgage loans under title I of the Act. Production Credit 
Associations (PCAs) could still make only short- and intermediate-term 
loans under title II of the Act. A customer seeking a long-term 
mortgage loan, for example, could apply to any Agricultural Credit 
Association (ACA), FLBA, or FLCA. A customer seeking short- or 
intermediate-term credit could apply to any ACA or PCA.
    FCA faces a statutory obstacle to giving customers the opportunity 
to obtain any type of loan from any association. The FCA Board would 
have to amend or issue new charters to associations that now have only 
title I or title II lending authority. The 1992 amendments to the Act 
prohibit this for FLBAs and PCAs in Louisiana, Mississippi, Alabama, 
and New Mexico \1\. These same FLBAs and PCAs under existing law could 
make both long-term and short-term loans if the following actions were 
taken:
---------------------------------------------------------------------------
    \1\ Section 5.17(a)(2) and (C) applies to the associations in the 
three southern states in the former Jackson district. FCA cannot 
overcharter existing associations without the consent of the affected 
FLBA or PCA and the respective funding bank. Sections 5.17 (a)(13) and 
(14) contain similar consent requirements before overchartering 
associations that reaffiliated under section 433 of the Agricultural 
Credit Act of 1987. Today, these provisions apply only to the 
associations located in New Mexico.
---------------------------------------------------------------------------
  --They merge with the unlike association(s) in their territory; or
  --They get permission from each association that now provides the 
        type of credit that they wish to provide in that association's 
        territory. These limits on FCA's chartering authority for 
        associations do not exist elsewhere in the country.
                          equity-based lending
    Question. Some of the lending banks are now reverting to the 1980's 
``equity based'' lending because crop and livestock projections do not 
justify writing a loan. Do you see farm credit borrowers significantly 
hurting from the same actions that took place a decade ago?
    Answer. We have found that System institutions learned from the 
mistakes of the mid 1980's crisis and, as a result, no longer emphasize 
collateral based lending practices that were referred to as ``equity 
lending'' in the 1980s. System institutions shifted to a repayment 
based lending philosophy, which was further strengthened with a 
disciplined approach to credit extension, using underwriting standards 
tailored to the types of commodities financed. In addition, FCA revised 
regulations addressing System underwriting standards to ensure ``an 
applicant has the operational, financial, and management resources 
necessary to repay the debt from cashflow.''
    When the agricultural economy is experiencing stress, however, FCS 
institutions have considerable flexibility under existing regulations 
to provide appropriate relief. Such relief efforts may include, but are 
not necessarily limited to, extending the terms of loan repayment or 
restructuring a borrower's debt obligations. A System institution may 
consider easing some loan documentation or credit-extension terms for 
new loans to certain borrowers or requesting FCA to grant relief from 
specific regulatory requirements. When conducted in a reasonable and 
prudent manner, the FCA will consider FCS efforts to work with 
distressed borrowers as consistent with safe and sound business 
practices.
    Over the past 10 years, the majority of FCS institutions have 
increased substantially the level of capital they maintain. In fact, 
the level of risk funds (which includes permanent capital and the 
allowance for losses on loans and other property owned) in relation to 
loans outstanding and other property owned increased from 10.9 percent 
at yearend 1989 to 21.1 percent at yearend 1998. The total capital of 
the System grew from $3.8 billion at the end of 1989 to $12.5 billion 
at the end of 1998. This indicates that System borrowers contributed 
substantially to rebuilding the financial strength of their cooperative 
associations and banks so that the institutions would be better able to 
withstand a downturn in the agriculture environment should it occur and 
be better positioned to work with their stockholder borrowers if 
necessary.
                       competitive interest rates
    Question. Does the Farm Credit Act prohibit Farm Credit 
institutions from offering interest rates that are below their 
competitors' rates? If yes, why?
    Answer. The Act does not expressly prohibit FCS institutions from 
offering interest rates that are below their competitors' rates. The 
Act provides that ``it shall be the objective'' of System lenders to 
set interest rates and other charges ``at the lowest reasonable cost on 
a sound business basis,'' taking into consideration the lender's cost 
of funds, necessary reserves, and the cost of providing services to its 
members.
    Under Section 1.1(c) of the Act, only System institutions that use 
regulatory accounting practices (RAP), as provided in the Farm Credit 
Act Amendments of 1986 and part 624 of FCA regulations, are prohibited 
from pricing their loans below competitive market rates. Currently, 
there are no FCS institutions using RAP. For FCS institutions not using 
RAP, neither the statute nor regulations specifically prohibit them 
from pricing their loans below their competitors.
    Question. There have been a lot of complaints directed towards Farm 
Credit Services of the Midlands because of special loan programs. Has 
this issue been taken care of and what actions have been taken to keep 
these special programs from offering below market rates?
    Answer. In early 1998, the FCA did receive several complaints from 
commercial banks regarding the loan pricing practices of the Farm 
Credit Services of the Midlands (now the FCS of America). The 
complaints were directed toward a special loan program promoting 5-year 
fixed-rate term loans for capital purchases (such as equipment 
purchases); and 15-year fixed-rate real estate loans. Both had a rate 
of 7.75 percent with no limit on loan size, no prepayment penalty, and 
no origination fee. At the time of the complaints, there were numerous 
advertised rates in the association's four-state trade territory from 
equipment and farm supply dealers that were similar to the rate offered 
by the association for similar loan products.
    Based on our examination of the association and our review and 
analysis of its loan pricing practices, including the above noted 
special program, we found no evidence that the FCS of America was 
offering interest rates that did not recover costs and earn a profit, 
or were significantly different than those rates currently offered 
under its differential pricing program. Further, we found no evidence 
that the institution's pricing program resulted in any violations of 
applicable law and regulations or was an unsafe or unsound practice.
    In our examinations of System institutions, the FCA evaluates an 
institution's earnings, including whether the institution obtains and 
uses competitor rate information in the pricing of its loan portfolio. 
The documents we reviewed indicated that the association obtained 
surveys of loan rates offered by banks and non-bank lenders in its 
territory. Also, the association's advertised loan rates were within 
the ranges of the rates offered by its competitors.
    We issued an informational memorandum to all System institutions on 
February 11, 1999, restating the statutory and regulatory requirements 
related to loan pricing, as well as how the FCA examines an 
institution's loan pricing practices. The memorandum stated that, 
consistent with the law, regulations, and sound business practices, 
System institutions should price loans at a level sufficient to cover 
all costs, fund provisions to the allowance accounts, and accumulate 
capital. Specific consideration should be given to the cost of funds, 
the cost of servicing loans, other costs of operations, interest rate 
risks, profit and marketing objectives, and the competitive 
environment. FCA examiners evaluate whether interest rates charged are 
consistent with established policies and are sufficient to cover costs 
and adequately capitalize the institution, while maintaining safety and 
soundness and remaining competitive in the marketplace.
    Question. Have there been any other cases of below market pricing 
in the past four years and what action was taken if there was?
    Answer. Over the past four years, our reviews of unfair or below 
market loan pricing have found no instances where an institution's loan 
pricing program resulted in below market pricing or was outside of the 
range of rates offered by competitors.
    Question. How does the FCA determine the competitive rate? Are Farm 
Credit Institutions required to do surveys of their competitors' 
prices? If yes, how often and why?
    Answer. As the System's regulator, FCA does not determine the 
competitive rate. The rate varies by location, type of lender, type of 
credit, qualifications of the borrower, and other loan terms. It is 
difficult to obtain exact information about actual loan rates and terms 
on loan pricing practices of institutions that are competitors of FCS 
institutions. While advertised rates provide useful information, the 
rates charged in individual transactions are often higher or lower than 
quoted rates. Generally, appropriate loan rates for System institutions 
are those that are sufficient to cover all costs, including credit 
risk, and earn a profit to be able to accumulate capital in 
consideration of the law, regulations, sound business practices and the 
competitive environment.
    No provision of the Act or FCA regulations expressly requires 
System institutions to conduct market surveys of competitors' loan 
rates. However, we believe that obtaining timely information of what an 
institution's competitors are charging for equivalent products is a 
sound and essential business practice and should be a part of the loan 
pricing policies and interest rate programs that System banks and 
associations are required to establish. We have strongly encouraged FCS 
institutions to conduct competitor interest rate surveys periodically 
to ensure their pricing practices are comparable to the market.
    Competitors now include more than commercial banks and other 
traditional lenders. There are many non-traditional lenders, such as 
John Deere and Pioneer Hi-Bred, also competing for agricultural loans. 
If there are instances of loan pricing by FCS institutions that appear 
to be outside of prevailing market interest rates, they would be 
scrutinized closely by our examiners.
                 government performance and results act
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. I, along with my fellow Board members, developed the FCA's 
vision statement, which serves as the basis for our Strategic Plan. As 
the CEO, I established performance-based management, through FCA's 
Leadership Team, focusing on accountability and regular reporting to 
the FCA Board on goal achievements. We have already begun gathering 
information to prepare our performance report to Congress and the 
public for the year ending September 30, 1999, which is due in March 
2000.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Our performance expectations are reflected in the 
individual merit performance plans of each of our managers and 
supervisors. Each executive has a performance plan for the Agency 
performance measures for which they are responsible, individually and 
collectively. These same performance expectations are the backbone of 
the quarterly report the FCA Board receives from management. This 
report describes the progress toward accomplishing our goals and 
objectives.
    Question. How is performance information being used to manage the 
agency?
    Answer. We use Agency plans and performance measures to develop 
direction, manage expenses, and provide objective feedback on success 
in meeting our goals. We focus on performance results and initiatives 
that support our goals and objectives. We are also critiquing 
activities that do not add value to accomplishing our stated goals. 
FCA's planning process is driven by customer and mission requirements. 
These include developing direct input and analysis of markets, 
identifying emerging needs and risks that dictate internal changes for 
FCA, and then shifting resources and priorities to meet these needs.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. We developed office budgets for fiscal year 2000 based on 
resources needed to accomplish Strategic Plan initiatives that were 
tied directly to our performance indicators. We also identified 
initiatives to further enhance our goal of ensuring the continued 
safety and soundness of the System. These initiatives were included in 
the performance plans supporting staff requirements and salaries to 
fund the planned work.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. As a financial regulator, the objectives of our strategic 
and operating plans focus on ensuring the FCS operates safely and 
soundly, meets the requirements of the statute and regulations, and 
benefits farmers, ranchers, agricultural cooperatives, and rural 
America as Congress intended. To further our success in meeting these 
goals, we have expanded our outreach and communication efforts to our 
customer base through a series of meetings and symposiums on topics of 
mutual interest. Also, our recent Philosophy Statement supports actions 
that will ensure a relevant FCS for the future. The introduction of a 
``Best People, Best Products, Best Practices'' initiative within the 
Agency has resulted in a clearer focus on what is important.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The cost accounting system within our Financial Management 
System links expenses by goals and functions. The system was modified 
in October of this fiscal year to ensure the linkage between these 
systems.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. Budget justifications to Congress are driven by object 
classes, such as salaries. Performance is tied to strategies and 
related activities designed to achieve results. In addition, the budget 
uses a 2-year horizon, while many worthwhile outcomes take much longer. 
We are developing 5-year human resource and financial plans to estimate 
and plan resources through the life cycle and significant milestones of 
major strategies. It is also clear that plans will necessarily change 
in order to stay relevant and reflect changes in assumptions. We expect 
to update plans as we learn from our experiences and sharpen 
performance measures.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. Yes. We have reliable data, and the databases are in place 
for reporting 17 of 20 measures included in our annual performance 
plan. The databases for two of the measures will be ready in time for 
the March 2000 report. The final measure includes a new customer survey 
that will not be completed until after the initial report is prepared.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. Future funding requests will consider actual performance 
compared to target performance by addressing these outcomes in the 
budget development and justification process. We are now developing a 
5-year financial plan to support the FCA 5-year Strategic Plan. 
Requests will continue to demand cost-effective performance and direct 
resources to higher value activities for public and mission goals. One 
of our performance measures uses the cost of the FCA budget to the 
customers of FCS institutions to determine customer value.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. We allocate the full costs of activities in support of a 
performance goal to that goal, including associated overhead costs.
                                 ______
                                 

                   Research, Education, and Economics

                 Questions Submitted by Senator Cochran
                     strategic planning task force
    Question. Please give us a report on the progress being made by the 
Strategic Planning Task Force on Research Facilities mandated by the 
Farm Bill.
    Answer. The Strategic Planning Task Force on Research Facilities 
has completed its review of agricultural research facilities and has 
prepared a draft report which has been widely circulated for review. 
The task force will meet in early summer to finalize the report in 
light of the comments that have been received.
    Question. Is the report of the Strategic Planning Task Force still 
scheduled to be released in April of 1999?
    Answer. It is anticipated that the final report will be printed and 
distributed this summer.
    Question. Are any of the Strategic Planning Task Force's 
forthcoming recommendations reflected in the President's fiscal year 
2000 Budget?
    Answer. Recommendations of the task force are not included in the 
President's fiscal year 2000 budget.
                     biobased coordinating council
    An increase of $1,500,000 is proposed for fiscal year 2000 in 
funding for the Under Secretary for Research, Education and Economics, 
as Chair of the Biobased Coordinating Council, to develop a list of 
biobased products. The budget justification indicates that the funds 
would be used to promote acquisition of biobased products and to help 
develop a biobased products list, including the development of 
standards, as well as for facilitating technology transfer to new 
products and for other purposes.
    Question. Under what authority was the Biobased Coordinating 
Council established? What is the composition and purpose of the 
Council?
    Answer. The Biobased Products Coordination Council (BPCC) was 
originally created as the New Uses Coordinating Council by Secretary 
Glickman in a decision memorandum dated September 13, 1995. The 
council's name was changed in 1996 to be more descriptive of and 
consistent with current terminology. The BPCC's purpose is to provide 
strategic planning and policy input on the development of biobased 
products from agricultural materials, including forestry materials, for 
commercial and industrial purposes. The BPCC garners input from its 
USDA members and actively collects economic, product and marketing 
information from other Federal agencies and non-Federal groups. A major 
accomplishment of the BPCC was planning and hosting a government-wide 
conference on the acquisition of value added products from agricultural 
materials. The conference, the National Marketplace for the 
Environment, was held in November 1997 in Washington, D.C. The BPCC 
will continue to be a part of other conferences and forums to further 
the government's and public's knowledge of biobased products.
    The Council's purpose was further strengthened by the Agricultural 
Research, Extension, and Education Reform Act of 1998 (AREERA). For 
example, one section of this law authorizes the Secretary of 
Agriculture to ``coordinate the research, technical expertise, economic 
information, and market information resources and activities of the 
Department to develop, commercialize, and promote the use of biobased 
products.'' Another section of the law identifies new and alternative 
uses and production of agricultural commodities and products as a 
priority mission area. The BPCC is carrying out these types of 
coordination activities on behalf of the Department.
    The BPCC is chaired by the Under Secretary for Research, Education 
and Economics and is composed of representatives from each interested 
USDA agency and office. Ex officio members include representatives from 
the Environmental Protection Agency, the Department of Energy, and the 
Office of the Federal Environmental Executive.
    Question. Describe in more detail how the $1,500,000 requested to 
develop a list of biobased products will be allocated, e.g., for 
promotion, development of a list, and technology transfer.
    Answer. The funds will be allocated to those activities supported 
in the BPCC strategic plan. Among the major activities that would be 
carried out or started in fiscal year 2000 are: the development, 
publication and maintenance of a biobased products list as directed in 
Executive Order 13101; educational activities, such as training and 
conferences, to inform the public and government agencies about 
biobased products; demonstration projects to create awareness of and 
demand for biobased materials; development of Internet-based 
information systems to promote biobased products; support for the 
Office of the Environmental Executive; and support for technology 
transfer activities through our research agencies with involvement of 
the private sector and industry partners.
    Question. Give examples of the activities which will be undertaken 
both to promote the acquisition of biobased products and to facilitate 
the transfer of technology to new products.
    Answer. Two activities have been accomplished which are the 
building blocks for future activities. The National Marketplace for the 
Environment conference in November, 1997, brought to Washington D.C. a 
huge showcase for biobased products, processes, and partnerships. 
Biobased products are a foundation piece for environmentally preferable 
purchasing by government agencies as directed in Executive Order 13101, 
Greening the Government Through Waste Prevention, Recycling, and 
Federal Acquisition. The publication of a Biobased Products List will 
be a major tool to promote acquisition of biobased products.
    Agriculture's leadership and innovation are essential in the 
development of biobased products. Research conducted under Cooperative 
Research and Development Agreements (CRADAs) will allow for the 
transfer of new technology to the private sector and industry. This 
pathway to technology transfer will be used in the development of 
biobased products.
    Another example that will promote acquisition of biobased products 
is the ``Federal Track'' (sponsored by the Office of the Federal 
Environmental Executive) in the annual National Recycling Coalition's 
Congress and Exposition. In this event Federal, State, and local 
governments join with educational institutions and commercial 
businesses to share information, success stories, and challenges on 
efforts to reach the goals of the Resource Conservation and Recovery 
Act of 1976 and related environmental activities.
                              stakeholders
    Question. How do the Department's research, education and extension 
agencies communicate with its stakeholders and customers on a regular 
basis? Please give specific examples.
    Answer. The main method of communication between the REE mission 
area and its stakeholders is through the National Research, Extension, 
Education and Economics Advisory Board. This board was established in 
the 1996 Federal Agricultural Improvement and Reform Act of 1996. The 
Advisory Board's role is to provide consultation to the Secretary and 
land grant colleges and universities on long-term and short-term 
national policies and priorities for agricultural research, extension, 
education and economics. In fiscal year 1998, for example the board 
held three public meetings in Washington DC, including the Second 
National Stakeholder Symposium, to solicit input and comment from those 
who conduct and use agricultural research, extension, education and 
economics. The board also held a regional listening session in Utah to 
hear the specific concerns of stakeholders in the Western region. The 
board held the Third annual Stakeholder Symposium on March 18 of this 
year.
    The REE agencies also use a variety of other venues, such as 
meetings, conferences, workshops, and public hearings to discuss with 
stakeholders and customers specific issues of particular importance to 
them. While the nature and focus of these activities varies, they are 
all important in helping the agencies and mission area to understand 
and therefore be responsive to stakeholders and customers needs.
    The Agricultural Research Service (ARS) has a long history of 
meaningful interactions with its customers and stakeholders. ARS' 
research scientists know who their customers and stakeholders are and 
they interact with them, formally and informally, throughout the life 
of the project. Customer input is important in helping to set the 
research direction for each project and customers help to evaluate the 
products and outcomes of that research. Each of ARS' eight Area Offices 
also conduct aggressive outreach efforts with State and regional 
customers and stakeholders of ARS research. At the National level ARS 
senior managers and National Program Leaders are in almost constant 
contact with the major organizations, associations, and a wide variety 
of Federal action and regulatory agencies that either use ARS developed 
knowledge and technology or have a keen interest in the work of the 
Agency. In developing its new Strategic Plan 1997-2002, ARS solicited 
customer input by printing the draft plan in the Federal Register and 
mailing copies to 1,400 customers and stakeholders.
    In the early stages of the development of the new National Program 
structure, the National Program Staff sent copies of various draft 
program statements to approximately 1,400 customers and stakeholders 
inviting their review and comments. A critical step in the 
implementation of the 23 National Programs is a series of planning 
workshops that bring together customers, stakeholders, partners, and 
ARS scientists. These workshops help identify specific customer needs, 
problems, and concerns that feed into the Agency's planning process. By 
this approach ARS is able to keep its research focused on solving 
specific problems confronting American agriculture.
    The following list of planning workshops (completed and upcoming) 
demonstrates the comprehensive outreach effort being made by ARS to 
ensure the relevancy of its research:
  --Animal Genomes, Germplasm, Reproduction, and Development, February, 
        2000
  --Animal Production Systems, February, 2000
  --Animal Health, September, 1999
  --Arthropod Pests of Animals and Humans, May, 1999
  --Animal Well-Being & Stress Control Systems, April, 1999
  --Aquaculture, September, 2000
  --Human Nutrition Requirements, Food Composition, & Intake, March, 
        2000
  --Food Safety (animal & plant products), February, 1999
  --Water Quality & Management, December, 1998
  --Soil Resource Management, October, 1998
  --Air Quality, May, 1999
  --Global Change, October, 1999
  --Grazing lands Management, February, 1999
  --Manure & Byproduct Utilization. April, 1998
  --Integrated Farming Systems, November, 1999
  --Plant, Microbial & Insect Germplasm Conservation & Development, 
        July, 1999
  --Plant Biological & Molecular Processes, February, 1999
  --Plant Diseases, August, 1999
  --Crop Protection & Quarantine, September, 1999
  --Crop Production, September, 1999
  --New Uses, Quality, & Marketability of Plant & Animal Products, May, 
        1999
  --Bioenergy & Energy Alternatives, April, 1999
  --Methyl Bromide Alternatives, November, 1998
    As part of its on-going commitment to be responsive to 
stakeholders, the Cooperative State Research, Education, and Extension 
Service coordinated a public forum, ``The USDA Solicitation of Input 
from Stakeholders regarding the Initiative for Future Agriculture and 
Food Systems'' in July 1998. The purpose of this forum was to foster 
dialogue between USDA and stakeholders on the implementation of the 
mandatory spending program authorized in Section 401 of Agricultural 
Research, Extension, and Education Reform Act of 1998 for competitive 
grants to address critical emerging agricultural issues. CSREES also 
coordinated a public meeting in December 1998 to solicit input from 
stakeholders regarding the role of the USDA/HHS Joint Institute for 
Food Safety Research. Agency personnel are using the input to develop 
plans for the Institute, which was created to (1) develop a strategic 
plan for conducting food safety research activities consistent with the 
President's Food Safety Initiative and (2) efficiently coordinate all 
Federal food safety research, including research conducted with the 
private sector and academia, to ultimately reduce the incidence of 
foodborne illness to the greatest extent feasible.
    CSREES has recently published in the Federal Register a proposed 
rule on stakeholder input requirements for recipients of agricultural 
research, education and extension formula funds. This proposed rule 
will implement section 102(c) of the Agricultural Research, Extension 
and Education Reform Act of 1996, and will require land grant and 
extension partners to report annually on the actions taken to encourage 
stakeholder input, and a brief statement of the process used by a 
recipient institution to identify individuals or groups as stakeholders 
and to collect input from them. The Department believes that these 
formal channels, as well as our continuing involvement with land grant 
and extension policy committees and farmer representatives will ensure 
that USDA's research, extension and education portfolio addresses the 
highest priority needs of American agriculture.
    ERS uses conferences, workshops, and briefings to seek stakeholder 
input on proposed studies. These activities are developed in 
conjunction with the scientific associations, cooperating universities, 
and other organizations concerned with research on agriculture. Recent 
examples include:
  --A workshop on economic analysis of long-term field trials of 
        organic farming systems in Washington, DC, in April 1999. The 
        workshop brought together economists associated with the long-
        term projects, the Organic Farming Research Foundation, the 
        Rodale Institute, the Wallace Institute for Alternative 
        Agriculture, the Leopold Center, and representatives of USDA 
        extension and research programs.
  --Two workshops on the issue of phasing out methyl bromide in 
        Gainesville, Florida in March, 1998, and in Sacramento, 
        California in June 1998. The participants included growers, 
        environmentalists, researchers, input suppliers, and State and 
        Federal administrators. Input from these meetings formed the 
        basis for an inventory of methyl bromide alternatives and the 
        information was used to produce economic models of the 
        potential impact of the methyl bromide phaseout.
  --A March 1999 workshop that brought together representatives of the 
        private sector, universities, the National Research Council, 
        the Congressional Research Service, and other USDA and federal 
        agencies to discuss economic research needs on transportation 
        issues and their impact on U.S. agricultural export 
        performance.
  --A Fall 1998 conference of experts on the economic and public health 
        consequences of achieving USDA's dietary guidelines, and a 
        follow-up conference in the spring of 1998 on the impacts of 
        possible changes to those guidelines.
    ERS also regularly attends industry meetings attended by its 
stakeholders. For example, its researchers attend the Fertilizer 
Institute's Economics and Information Committee meeting each Spring, 
the International Poultry Waste Management Conference, the 
International Conference on Methyl Bromide Alternatives, and numerous 
annual conferences sponsored by commodity groups. ERS also meets 
directly with specific stakeholders and customers to discuss issues of 
particular importance to them to obtain their individual opinions and 
perspectives. For example, ERS leadership met with seven organizations 
in the fresh produce industry to discuss their desire to see more 
research on concentration in their industry. The Agency plans to expand 
its repertoire of communication channels by developing a series of 
round tables with a broad range of commodity and industry groups. The 
first of these round tables is being planned for mid-1999.
    One of the primary ways that NASS regularly communicates with its 
stakeholders, customers, and data providers is through the grassroots 
contacts maintained by the 45 field offices. These State offices work 
directly with State cooperators, usually State departments of 
agriculture, and keep in touch with the agricultural leaders in farm 
organizations and producers across their States. All NASS field offices 
have toll-free numbers. Each field office has a Home Page in addition 
to NASS's main Home Page. NASS Headquarters staff also attend a number 
of national agricultural commodity meetings, exhibitions, conferences, 
and meetings of the National Association of State Departments of 
Agriculture. In addition, NASS hosts many visitors each year for its 
crop and livestock report ``lock-up'' briefings.
    Another major source of feedback for NASS are data users meetings 
held at least twice per year. Input gathered at these meetings help 
NASS keep its statistical program responsive to the current needs of 
the agricultural sector.
                    response to stakeholder concerns
    Question. Name changes that have been made in the Department's 
research program over the past year to respond to the concerns and 
needs of its stakeholders and customers?
    Answer. The REE agencies regularly make adjustments in its programs 
in response to stakeholder and customer concerns and needs. Many are 
adjustments within programs based on new understandings of stakeholders 
problems or concerns.
    At the laboratory, Area Office, and headquarters levels, ARS 
maintains continual contact with a wide range of customers and 
stakeholders. The purpose of this dialogue is to keep our research 
program relevant to its mission of solving critical national problems 
that confront American agriculture. In the last 18 months, ARS has made 
a number of changes in its research activities in response to customer 
and stakeholder input.
    One of the most important changes to occur is the initial 
implementation of the aggregation of 1100+ research projects into 23 
National Programs. This process has had active input from ARS' 
customers, stakeholders, and partners since its inception. Draft 
program statements were submitted to our customers for review and 
comment. Planning workshops have been or will be held for each program 
or major program components. These workshops bring together customers, 
stakeholders, partners, and ARS scientists to help focus the Agency's 
research program on meeting the highest priority needs of American 
agriculture. ARS is also strengthening it peer review processes to 
ensure the quality of research programs. By mid-summer, the National 
Program Staff will make an Annual Report on each of the 23 National 
Programs available to its customers, stakeholders, and partners on the 
ARS home page. The Agency intends to send a notice to all interested 
parties when these reports are available, inviting their review and 
comments.
    In response to stakeholder input, in fiscal year 1999 CSREES added 
the following National Research Initiative programs: Epidemiological 
Approaches for Food Safety; and The United States Rice Genome 
Sequencing Project.
    ERS continually appraises and adjusts research plans to address 
stakeholder and customer needs. As an example, a new research project 
was formulated based on perceived concerns about the role of 
agriculture in emerging water quality problems of coastal areas. 
Initial plans for the project have been based on a host of specific 
situations, such as the hypoxia problem in the northern Gulf of Mexico, 
pfiesteria piscida eruptions in North Carolina's Albemarle Sound and 
the Chesapeake Bay, red tides in Florida, and salinity and nutrient 
problems in the San Francisco Delta and Puget Sound, all characterized 
as harmful algal blooms attributed to excessive nutrient enrichment of 
coastal waters.
    Other priority studies designed to respond to issues presented to 
it by key stakeholder and customers include: An ERS-wide study of 
concentration in the food system; an analysis of the changing global 
meat market and its implications for US trade; a multi-division 
research activity on the economic impacts of biotechnology; a major 
initiative on risk management; and analyzing the impact of the 
financial crisis on US agricultural exports. In addition, the Agency 
has responded to stakeholder and customer requests by reinstating a 
full complement of its commodity analysis reports, and making them 
available in concise form on the Internet. Following a meeting with 
seven representatives of the fresh product industry, ERS initiated a 
study of retail trade practices and market structure in the produce 
industry.
    On an on-going basis, NASS modifies and enhances the content and 
access to the vast array of data it provides customers. For example, 
the Advanced Very High Resolution Radiometer (AVHRR) instrument 
contained on the NOAA-14 weather satellite continues to be used to 
monitor changing vegetative conditions throughout the growing season. 
The NASS Internet web page allows Agency and external users to 
reference the following 1995-1999 map products on a real time basis: 
vegetative index maps, ratio comparisons to the previous year, within-
year thumbnail time series, and frost danger. In response to customer 
requests, a new product was created to compare the current period's 
data to that of a 4-year median (1995-1998). In addition to GIF 
(Graphic Interchange Format) images, ftp (file transfer protocal) users 
now have access to postscript files allowing high resolution printing 
of the AVHRR products from the web.
    Research also produces Landsat images categorized by specific 
crops, which is helping to meet the demand for spatial information on 
crops. A new initiative has been launched to develop external 
partnerships that will increase remote sensing capabilities for State 
Statistical Offices.
    Research into the graphical display of data, which will allow users 
a better understanding of inherent patterns and structure, and a better 
ability to visualize and analyze data, has begun. The long-term goal of 
this research is to allow the users to dynamically generate graphical 
displays through the web. Historically, access to the data have been in 
tabular form only.
                           research portfolio
    Question. Dr. Gonzalez, you indicate in the testimony you have 
submitted to the Committee that ``we must find ways to balance the 
research portfolio in helping colleges and universities enhance their 
future capacity with base funding'' to strengthen their ability to 
compete successfully for research funding. Would you please describe 
the imbalances which have been identified by the Department and what 
the Administration is doing to correct these problems.
    Answer. When I refer to balances in the research portfolio, I am 
thinking mainly of imbalances between the various categories of land 
grant colleges and universities that we have across the nation. 
Specifically, I refer to the vast differences in funding between our 
1862 land grants and our minority-serving institutions, namely the 
1890's and the 1994's and some Hispanic Serving Institutions. For these 
institutions to compete for funds in a competitive environment, the 
system must identify ways for these institutions to use their formula 
funds to leverage additional capacity building resources. Very soon, 
the Cooperative State Research, Education and Extension Service will 
publish in the Federal Register a proposed rule to implement Section 
226 of the Agricultural Research, Extension and Education Reform Act of 
1998 which requires increased non-federal matching funds for 1890 
institutions. The Reform Act also allows the 1994 institutions to 
conduct research and extension programs under cooperative agreements 
with other land grant institutions. Both of these provisions will allow 
these institutions to use their existing formula fund resources to 
improve their research capacity, make them more competitive for state 
and private sector resources, and add diversity in approach to the 
solution of agricultural problems.
                       integrated pest management
    Question. Will the Administration achieve its goal for the adoption 
of Integrated Pest Management (IPM) practices on 75 percent of U.S. 
cropland by the year 2000? Where are you currently in meeting this 
goal?
    Answer. Consensus has emerged that Integrated Pest Management--
IPM--systems should be measured along a continuum, ranging from no 
integration of management tactics to high levels of IPM adoption. The 
Department's 1994 report, Adoption of Integrated Pest Management in the 
United States, measured adoption along a continuum, and this approach 
was refined by Consumers Union in its 1996 report, Pest Management at 
the Crossroads. This report estimates that in the year 1996, 70 percent 
of crop acreage was managed with pest management systems at the low end 
of the IPM continuum. Our goal is to develop and help growers implement 
IPM strategies that will enable them to move from the low to the high 
end of the continuum. This will involve incrementally-enhancing 
biologically-based IPM systems within each production system.
    The overall percentage of U.S. crop acres under IPM in 1998 remains 
at the 70 percent level, and will likely remain constant in 1999. 
However, we remain convinced that the increased investments proposed in 
the President's budget request for fiscal year 2000 will permit us to 
reach the 75 percent adoption goal by 2000. More importantly, we 
believe that these investments will accelerate the adoption of IPM 
systems at the medium and high end of the continuum. We believe that 
increased adoption of pest management systems at the high end of the 
IPM continuum will benefit all Americans by increasing profitability, 
protecting water quality and farm worker safety, and enhancing the 
wholesome quality of our Nation's food supply. We believe that an 
accelerated effort is warranted to develop IPM strategies and to assist 
growers to implement pest management strategies through educational 
programs that will help them reduce reliance on high-risk pesticides 
and enhance sustainability of their operations.
                         agricultural problems
    Question. Please describe the Department's response to acute 
agricultural problems, such as the wheat and barley scab crisis and to 
the avian influenza.
    Answer. The U. S. Department of Agriculture (USDA) recognizes the 
seriousness of acute agricultural problems, such as wheat and barley 
scab, and avian influenza.
    The USDA-Agricultural Research Service (ARS) is expanding its 
research program on Fusarium Head Blight, and is working closely with 
the U.S. Wheat and Barley Scab Initiative to increase collaboration 
between Federal and State laboratories. The Cereal Rust Laboratory and 
the wheat genetic improvement project at St. Paul, Minnesota, have 
focused efforts on improved varieties with enhanced resistance to scab. 
In fact, a wheat line with significant resistance has been released 
from that program. In Peoria, Illinois, emphasis has been on the 
importance of the toxin in virulence and upon biocontrol approaches. 
$1,000,000 was appropriated to ARS for scab research in Minnesota in 
fiscal year 98. In fiscal year 99, Congress appropriated an additional 
$3,000,000 for cooperative research between ARS and the U.S. Wheat and 
Barley Scab Initiative. ARS is allocating the $3,000,000 to in-house 
research and grants to scientists in 20 States participating in the 
Initiative.
    The Southeast Poultry Research Laboratory (SEPRL) located in 
Athens, Georgia, has been intimately involved in the eradication, 
control, and prevention of the highly infectious and lethal avian 
influenza virus. The research program will assist the U.S. poultry 
industry and other countries in influenza control. Assisting other 
countries with information and collaborative research is an effective 
strategy to prevent highly pathogenic Avian Influenza from being 
introduced into the U.S.
    SEPRL has been particularly active in research on H5N1 avian 
influenza, which occurred in Hong Kong in 1997. The H5N1 outbreak began 
as a problem in chickens and spread to infect at least 18 people. SEPRL 
has collaborated with the Agriculture and Fisheries Department in Hong 
Kong and the Hong Kong Zoo on the agricultural aspects of the disease 
outbreak. This includes providing expert advice and research 
collaboration on currently available and new serologic tests to detect 
the virus and diagnose the disease and delivery of a new vaccine to 
protect poultry. SEPRL collaborated with the Centers for Disease 
Control (CDC) in Atlanta, Georgia, on the characterization of isolates 
of the H5N1 viruses. The CDC conducts, as required by law, all aspects 
on diagnosis of the H5N1 influenza in humans and handles all human 
clinical specimens. The SEPRL provided collaborative research support 
on molecular epidemiology of the viruses and testing the human isolates 
for ability to infect and cause disease in poultry and other bird 
species.
                  information to farmers and producers
    Question. How does the Department currently ensure that information 
for the Department's research and analyses reaches farmers and 
producers? What improvements are being proposed for 2000?
    Answer. The Department uses a variety of avenues to ensure that 
information and technology from its research and analysis program 
reaches farmers.
    ARS scientists work directly with farmers and producers by 
involving them in field trials, research workshops, and other informal 
and formal outreach. For example, the Area-Wide Integrated Pest 
Management Project in the Pacific Northwest directly involves dozens of 
farmers. Once results began to be analyzed, the program also became a 
demonstration to inform many other growers of ways to reduce their use 
of chemical pesticides.
    ARS produces a number of technical and semi-technical publications 
that provide important research results and analyses to small and large 
farmers and producers. For example, ARS recently published a series of 
manuals for crop residue management to reduce erosion and improve soil 
quality for farmers bringing their land out of the Conservation Reserve 
Program. ARS also publishes information such as the Cotton Ginner's 
Handbook, which provides new research information to the industry. ARS 
also distributes research information written for broad public 
audiences including farmers and producers through such Agency 
publications as Agricultural Research Magazine and the Quarterly Report 
of Research Results.
    In order to make efficient use of resources, ARS disseminates 
research results through information multipliers such as commodity and 
trade associations, farm and general media, and educational and service 
organizations and agencies such as Cooperative Extension offices and 
State Agricultural Experiment Stations. ARS also distributes 
information through appropriate USDA farm service and regulatory 
agencies. For example, ARS supplied extensive amounts of research 
information for the Grasshopper IPM User Handbook, which is available 
to farmers through USDA Animal and Plant Health Inspection Service.
    Tremendous amounts of ARS information are being made accessible 
through the Internet. All technical and semi-technical publications are 
now also published electronically, providing wider access to the 
information. Individual labs as well as Agency programs maintain web 
sites that include new research results and analyses. ARS maintains a 
searchable web site that provides extensive resources to farmers and 
other stakeholders at http://www.ars.usda.gov. Information about ARS's 
research initiatives in 23 National Programs and ongoing workshops is 
available at this site and also at http://www.nps.ars.usda.gov.
    The many resources of the National Agricultural Library (NAL) are 
also Web-accessible. From the home page at http://www.nal.usda.gov 
farmers and producers can search the bibliographic database, AGRICOLA, 
with more than 3,500,000 citations to the literature of agriculture, a 
significant portion of which are USDA publications. Specific 
Information Centers at NAL support such diverse communities as small 
farms (Sustainable Agriculture Information Center), mayors and rural 
communities (Rural Information Center), and those concerned about water 
quality (Water Quality Information Center). The Food and Nutrition 
Information Center covers the range of nutrition interests of farmers 
and producers and provides information relevant to the school lunch 
program, WIC program participants, dieticians and the general public.
    ARS improvements proposed for 2000:
  --A systematic effort will be made to provide direct access to ARS 
        research publications in electronic form on the Web.
  --Continuation of outreach to farmers and producers through National 
        Program workshops and reviews across the country.
    The Cooperative Extension Service is the premier system for 
disseminating information from Federal and land grant research programs 
to farmers and producers. The Agricultural Research, Extension and 
Education Reform Act of 1996 gives the Cooperative State Research, 
Education, and Extension Service new authority to link research, 
extension and education programs in Section 406. The fiscal year 2000 
budget takes full advantage of this new authority by proposing 
integrated research projects in the areas of FQPA Implementation, 
Methyl Bromide Transitions, Food Safety and Water Quality, among 
others. These topics represent immediate concerns where research 
results must be translated to on-the ground impacts as soon as 
possible. The Department believes that linking research and extension 
from the beginning will ensure the most efficient transfer of new 
knowledge to farmers and ranchers.
    ERS has a comprehensive dissemination program to ensure that its 
information, research and analyses reach the widest possible audience. 
This program includes (with no charge to users): electronic copies of 
all agency reports on the Internet; e-mail subscriptions for time-
sensitive crop, livestock, and agricultural trade reports; and 
documents available through a fax-on-demand system. It also includes 
wide distribution of printed reports and summaries to the news media 
and other information services, to State cooperative extension 
programs, and to farmer and producer groups for use in their 
communications. Additionally, all ERS reports are available (for the 
cost of distribution) from the USDA Order Desk, 1-800-999-6779, which 
is a service operated by the National Technical Information Service of 
the Department of Commerce.
    In addition to the release of each research and market analysis 
report, a broader publication program has been designed to generate 
articles and features in ERS and USDA periodicals, and in popular, 
widely-read outlets such as Choices, and the Journal of Soil and Water 
Conservation, and peer-reviewed journals. ERS regularly publishes a 
variety of monographs targeting a diverse clientele and stakeholder 
constituency, and designed to communicate complex issues and research 
findings in a straightforward and useful manner:
  --Agricultural Outlook is the Agency's main outlet for summarizing 
        the situation and outlook for agricultural commodities, and for 
        communicating in an easily readable manner the findings of 
        analyses and research on a broad range of commodity market, 
        trade, and natural resource policy issues.
  --Rural Development Perspectives publishes the results of new 
        research on rural economic and social changes. Articles are 
        especially targeted toward areas with policy relevance.
  --Rural Conditions and Trends provides yearly updates of current 
        economic, social, and policy developments affecting rural 
        America.
  --Food Review, ERS' magazine of food economics, provides public and 
        private decision makers with data and analyses of the economic 
        issues surrounding domestic and foreign food consumption, food 
        prices, export opportunities, food safety, nutrition, 
        marketing, and the impacts of Federal food regulations and 
        policy reforms.
    ERS has recently made a number of investments in improved 
electronic information dissemination which will continue in 2000. 
Through these investments ERS has improved its capacity to access 
information from the U.S. trade database and share it more easily with 
other users. The Agency is now developing a prototype of a web-based 
interactive data base, which would make our data directly and easily 
accessible to policy makers and the general public. The Agency is also 
reviewing our system for disseminating printed information to assure 
that we are reaching key individuals and groups, including 
organizations which can further disseminate our work to farmers and 
producers. ERS has developed new products--country, commodity and issue 
briefing rooms--which are updated regularly. These provide users with 
focused and timely information from both our data bases and published 
work.
    Annually NASS publishes over 400 national reports which cover more 
than 120 crop and 45 livestock items. These basic and unbiased data are 
necessary to maintain an orderly association between the consumption, 
supply, marketing, and input sectors of agriculture. The popularity of 
accessing NASS information through Internet continues to grow. During a 
recent month, the USDA Web Server was accessed an average of 1,600,000 
times a week, of which inquiries to NASS accounted for nearly 254,000. 
The NASS crops and livestock reports were first in popularity among 
USDA agencies, with 11,000 to 14,300 hits per week. E-mail 
subscriptions to NASS reports increased over 30 percent in the last 
year and electronic subscriptions for all reports total nearly 13,000. 
NASS continues to work with ERS, WAOB, and Cornell University to 
enhance the USDA Economics and Statistics System Internet site at 
Cornell University. The Mann Library at Cornell University archives 
reports and provides an e-mail subscription service for NASS, ERS, and 
WAOB under a cooperative agreement. The new USDA Economics and 
Statistics System Home Page improves navigation from any page. The e-
mail subscription process was upgraded to enable customers to click on 
the desired reports in order to subscribe.
                                 ______
                                 

           Federal Administration and Special Research Grants

                 Questions Submitted by Senator Cochran
                      aflatoxin research, illinois
    Question. Please provide a description of the research that has 
been conducted under the Aflatoxin Research, Illinois grant.
    Answer. This research is focused on development of strains of corn 
which will be highly resistant to infection with Aspergillus flavus and 
the production of aflatoxin under field conditions. After 
identification of resistant strains through field testing, transfer of 
genetic material into usable corn inbred strains will be performed.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for the 
research?
    Answer. There is much national concern about the role of aflatoxins 
as carcinogens in the human population. The aflatoxin material is also 
toxic to animals and humans. The presence of the fungus in corn results 
in a lower value for the crop and the possible rejection of the corn. 
Aflatoxin contamination continues to be a serious problem in the 
southern and southeastern United States, although outbreaks can and 
have occurred during severe drought conditions in the upper mid-west 
and other areas during the past few years.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the research was the reduction of 
infestation of corn with Aspergillus flavus and the consequent 
reduction of aflatoxin in the corn produced. The researchers have 
produced strains with resistance genes for both prevention of infection 
with A. flavus as well as the production of the aflatoxin itself. Field 
trials have been in progress to determine effectiveness of these 
resistance factors under normal growing conditions when exposed to the 
fungus.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1990, $87,000; fiscal year 1991, $131,000; fiscal 
years 1992-1993, $134,000 per year; fiscal year 1994, $126,000; and 
fiscal years 1995 through 1999, $113,000 per year. A total of 
$1,177,000 has been appropriated.
    Question. What is the source and amount of non-federal funds by 
fiscal year?
    Answer. The non-federal funds have been from state appropriated 
dollars in the form of principal investigator and technical salaries, 
equipment usage, and experimental plot expenses. These have been at the 
level of $130,000 for fiscal years 1997 and 1998.
    Question. Where is this work being carried out?
    Answer. The research is being performed in the Department of Crop 
Sciences at the University of Illinois.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
was 1995, but the project was revised last year to continue to fiscal 
year 2002. The primary reason for the extension of the work is that 
there appear to be multiple resistance genes which are necessary to 
prevent both the infection with the fungus and the synthesis of the 
aflatoxin compound. The investigators are very optimistic about the 
future success of this approach and this work will be discussed at a 
meeting of Multi-State Research Project NC-129 on January 25-26, in New 
Orleans.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last evaluation by the agency was in 1996 at which time 
the project was considered to be progressing well and had a high 
probability of success in meeting its original objectives. The project 
also receives a form of peer review as it is discussed each year during 
the annual meeting of NC-129, a project focused on mycotoxin production 
and toxicity of the toxins in animals and humans.
         ag-based industrial lubricants research program, iowa
    Question. Please provide a description of the research that has 
been funded under the Ag-Based Industrial Lubricants Research Program 
grant.
    Answer. This project is a continuation of eight years of activity 
conducted to target specific applications, establish baseline 
performance data, develop formulations of additives and chemical 
modifications, administer laboratory and field tests, characterize, and 
build relationships for commercialization of industrial lubricants 
derived from U.S. grown vegetable base oils. Baseline performance data 
will be compiled to establish fatty acid compositions, guide genetic 
modifications, additive development, establish standards relative to 
toxicity and biodegradability, and characterize compatibility with 
specific metallic and non-metallic components. The grant has been peer 
reviewed internally at the University of Northern Iowa.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Primary local and regional need is related to expanding 
value-added applications of agricultural commodities in order to 
stimulate increased demand and raise crop prices paid to farmers. On a 
national level, the need is to provide renewable, safer, more 
environmentally-sound alternatives to petroleum based industrial 
lubricants. The principal investigator believes this research to be of 
local, regional, and national importance.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the program was sponsored by non-
federal funding to develop a soybean-based hydraulic oil which was 
introduced to market in July of 1997, marketed by AGRI Industries of 
West Des Moines, Iowa as BioSOY hydraulic fluid. In part as a result of 
the product's availability, Iowa law SF2185 was unanimously passed that 
requires users of state owned equipment to demonstrate a preference for 
purchasing soybean-based hydraulic fluid when applicable. As of January 
1999, and with the consensus of AGRI Industries, the original license 
was transferred to West Central Cooperative of Ralston, Iowa, which is 
in a better position than AGRI to market the product. Field testing of 
two grease formulations and a dielectric transformer coolant has begun, 
as well as development of a two-cycle engine lubricant and bar and 
chain oil. A large volume of technical data has been compiled specific 
to crop-based oil and lubricants. This program has identified and has 
begun servicing a broad array of market development requirements, 
including demonstrating specific performance features, expanding 
awareness, and supporting government purchase initiatives.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Federal funding for this project began with a 1998 
appropriation of $200,000. The fiscal year 1999 appropriation is 
$250,000 for a total of $450,000 appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Since 1992 this research program has received cash grants 
from the Iowa Soybean Promotion Board, Carver Scientific Research 
Initiatives, in addition to several in-kind donations from industry to 
develop and coordinate commercialization of what has since become 
BioSOY hydraulic oil. Beginning in 1995, the state of Iowa began to 
support the program through its Wallace Technology Transfer Foundation. 
Beginning in 1996, state funding was provided by legislative 
appropriation through the Iowa Department of Economic Development. 
Additional funding has been provided by the Iowa Department of 
Agriculture and Land Stewardship. In fiscal year 1998, $150,000 was 
appropriated through the Iowa Department of Economic Development, 
$50,000 from the Iowa Soybean Promotion Board, $25,000 from Iowa 
Department of Agriculture and Land Stewardship, $32,500 from John 
Deere, and other awards and service revenues totaling approximately 
$60,000. State funding for the program in the amount of $250,000 has 
been requested through direct appropriation to the university.
    Question. Where is the work being carried out?
    Answer. Laboratory and literature studies are being carried out 
primarily at the Ag-based Industrial Lubricants Research Program 
facility in Waverly, Iowa, with minor portions of activity being 
conducted on the campus of the University of Northern Iowa in Cedar 
Falls, Iowa and the laboratories of various industrial affiliates 
located throughout the state and country. Field tests are being 
conducted at Sandia National Laboratories, U.S. Department of Army test 
sites, some municipalities, and in industrial equipment located 
throughout the nation.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Data collection, additive and modification research, 
characterization, and supplier development objective of the first year 
are ongoing. The development of the dielectric transformer coolant is 
an added objective and has been expedited through to field testing. 
Activities to expand public awareness and support government purchase 
initiatives have been added to the original objectives. This activity 
will be significant in implementing the lubricants section of Executive 
Order 13101. Field testing of some products is expected to be completed 
within a year, and additional lubricant applications are anticipated to 
be targeted within a year for development in subsequent periods.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The cognizant staff scientist reviews quarterly reports and 
has determined that this research is conducted in accordance with the 
mission of the agency.
        agricultural diversification and specialty crops, hawaii
    Question. Please provide a description of the research that has 
been funded under the Agricultural Diversification and Specialty Crops 
grant.
    Answer. With the resurgence of interest in Hawaiian culture and 
corresponding increased prevalence of Hawaiian dances, there is 
increased pressure on plant materials found in State and Federal 
forests in Hawaii. To this end, the University of Hawaii College of 
Tropical Agriculture and Human Resources has been working on the ``lei 
project'', involving about 20 members from the College and different 
organizations in the state working together to develop a handbook for 
the production and business of materials for Hawaiian lei. Efforts 
continue to find entrepreneurs to grow and process taro on a large 
scale for hypoallergenic products. Work is continuing with Maui onion 
growers who are potentially interested in obtaining a Federal Marketing 
Order for their unique onions. This effort has focused on researching 
market potential and giving informational talks. Work continues on 
kava, a root crop used as a non-addictive natural relaxant. Work 
continues on high pressure food processing of pineapple and other 
tropical fruits to eliminate quarantine problems and utilize cull 
fruits. This project is merit reviewed by the university.
    Question. According to the research proposal, or the principal 
investigator, what is the national, regional or local need for this 
research?
    Answer. Unfortunately, Hawaii's economy is not sharing the current 
growth and prosperity of the other states on the U.S. mainland. The 
small projects that are being undertaken under the umbrella of the 
Diversified Agriculture project are just one attempt to provide to some 
current and would-be entrepreneurs the tools they need to make business 
decisions about agricultural opportunities. The principal investigator 
believes this research to be of local and Pacific regional need, and, 
in some cases, national need.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the original proposal was to screen potential 
food and non-food crops for commercial development in Hawaii and then 
make earnest attempts to work with willing and able entrepreneurs to 
move the results of research into the private sector. As mentioned 
above, the lei project has been working with the people who know how to 
produce the 85 plants most likely to be made into a lei. That knowledge 
will be transferred to willing entrepreneurs so that they can take 
advantage of the opportunity created by the increased awareness of the 
Hawaiian culture. The taro project struggles with the reality of a 
tight economy and a lack of risk-taking, mass production-oriented 
entrepreneurs. The lessons learned from this work and the written 
outputs have been serving and will continue to serve as templates for 
other crops and opportunities in Hawaii. `This Hawaii Product Went to 
Market' will continue to serve agricultural entrepreneurs needs for 
years past the end of this project. Expanding the market for Hawaii's 
agriculture, in this case Maui onions, is a goal that will be met if 
the growers decide they want to make the effort to self-regulate their 
industry with a Federal marketing order.
    Question. How long has this work been underway and how much has 
been appropriated, by fiscal year, through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1988-1989, $156,000 per year; fiscal years 1990-
1993, $154,000 per year; fiscal year 1994, $145,000; and fiscal years 
1995-1999, $131,000 per year. A total of $1,728,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The University of Hawaii provides in-kind support in the 
form of laboratory and office facilities, equipment and equipment 
maintenance, and administrative support services: $68,503 in fiscal 
year 1992; $75,165 in fiscal year 1993; and $74,663 in each fiscal year 
1994-1998. In addition, nearly $50,000 of in-kind support has come from 
private sector and state partners, $8,000 from the Office of Hawaiian 
Affairs, and $30,000 from the private sector on the high pressure 
minimal processing project.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the University of Hawaii's 
College of Tropical Agriculture and Human Resources on the island of 
Oahu, and on the islands of Maui and Hawaii.
    Question. What is the anticipated completion date for the original 
objectives of this project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. All taro work is complete. Work on the marketing book is 
also complete. Work continues on kava, high pressure processing, and 
other projects consistent with the original goal. Work on kava 
agronomics is expected to continue through fiscal year 1999. High 
pressure processing for pineapple, papaya, and banana is expected to 
continue for another 1-2 years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency representative to this project meets with the 
investigators at least twice each year to review progress and plan 
subsequent activities. This close interaction has led the project 
though a progression of steps from research discovery to near-term 
commercialization of various products, and, in the case of high 
pressure processing, back to testing and development of a new 
technology for possible commercial use.
              agricultural diversity/red river, mn and nd
    Question. Please provide a description of the research that has 
been funded under the Agricultural Diversity/Red River Grant.
    Answer. This multi-year, multi-phase project will have six specific 
components. They are:
  --vegetable growing research, especially field and glasshouse-related 
        research;
  --vegetable collection and storage research and/or related storage or 
        distribution business development;
  --development of processing industries for the fresh market or 
        research related to the fresh products for market; development 
        of marketing and/or supply associations among vegetable 
        producers; development of processing industries for the ready-
        to-eat salad market or research related to ready-to-eat 
        products; and development of processing industries for the 
        frozen vegetable products market or research related to frozen 
        products. The first phase of this multi-phase project will 
        concentrate its industry development and research activities in 
        three areas: vegetable growing research, especially field and 
        glasshouse-related research, development of marketing and/or 
        supply associations among vegetable producers, and development 
        of processing industries for the ready-to-eat salad market or 
        research related to ready-to-eat products. The second phase of 
        this multi-phase project will concentrate its activities in 
        four areas: continued research on vegetable production, 
        including commercial greenhouse production and field production 
        using Missouri River water for irrigation; development of 
        markets for fresh product; preparation of a business plan for a 
        ready-to-eat delicatessen salad processing facility in the 
        region; and analysis of the potential for adding higher value 
        complementary crops to the rotation mix in vegetable producing 
        areas.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Initially the growing of vegetables in the region was 
driven by an opportunity to meet increasing consumer demand for fresh 
vegetables and concerns over both the cost of water and the 
environmental impacts of the use of chemicals in the traditional 
vegetable-producing regions of the southern United States. This 
industry currently raises three crops of vegetables a year. This 
requires extensive irrigation in the hot summer months. Population 
growth and increased domestic and industrial demands for water have 
created significant pressures to shift water usage away from 
agriculture and toward other domestic and industrial needs. 
Additionally, use of chemicals to fight soil bacteria has raised 
environmental concerns in these states. These issues created a need to 
identify other regions to produce vegetables, especially in the summer 
months. The northern plains states of Minnesota, North Dakota, and 
South Dakota have been identified as one area that could meet this 
need. In addition, the opportunity to add a high-value crop to the 
rotation cycle for northern Great Plains farmers can help to decrease 
their dependence upon program crops. The shift in cropping patterns can 
have a positive effect on farm income and lessen the need for outside 
or Federal financial assistance. Interest in the potential for adding 
higher value crop to the rotation cycle, including vegetables, has 
increased significantly in the past year due to the poor farm economy. 
Research on the potential for adding new crops to the region's 
production base could help stabilize the farm economy in the region and 
lessen the need for outside financial assistance to farmers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The project objectives include: (1) conduct three 
replicated field trials on growing of carrots; (2) continue study of 
vegetable growing techniques in Europe, and continue negotiations with 
vegetable growing research facilities/laboratories in Europe to 
transfer growing knowledge to the region; (3) review current and future 
market opportunities for further development of the industry and 
identify strategies and partners for pursuing these opportunities and 
take appropriate organizing steps; (4) develop and maintain a WWW 
Webpage for this vegetable industry project; (5) conduct market 
research for establishment of a ready-to-eat delicatessen salad 
processing facility in the region; (6) conduct market research for 
establishment of a ready-to-eat fresh-bagged salad processing facility 
in the region; (7) continue business development planning for 
establishment of a ready-to-eat delicatessen salad processing facility 
in the region; and (8) continue business development planning for 
establishment of a ready-to-eat fresh-bagged salad processing facility 
in the region. Funding for this project was received July 1, 1998 at 
which time work on the project began. Accomplishments to date include: 
Establishment of an advisory task force of producers, researchers, and 
economic developers. Completion of a comprehensive search of the 
published literature in the northern Great Plains region regarding 
vegetable production. The data are now being catalogued by specific 
category, including vegetable types and type of research--i.e. 
production, processing, storage, etc. Maps are being prepared that will 
show soil types, precipitation, climate, and ground water. Overlays of 
these data are also being prepared in order to identify specific high 
potential areas for growing vegetables. A public information brochure 
titled ``Growing and Processing Vegetables on the Northern Great 
Plains: Options and Opportunities'' has been prepared. The USDA 
provided funding to prepare the report, and the Ford Foundation funds 
were used to print the report.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work supported by this grant began in fiscal year 1998 
with appropriations for fiscal year 1998 and 1999 for $250,000 per year 
for a total of $500,000 appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal support will come from private growers, state 
agri-development project funds, the Ford Foundation, and other local 
foundations. The amount of non-federal support since July 1, 1998 has 
been approximately $50,000.
    Question. Where is the work being carried out?
    Answer. The work is being carried out in Minnesota, North Dakota, 
and South Dakota.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Since this is a new project and has not yet started, any 
original objectives have not been met. It is expected that this will be 
a multi-year, multi-phase project. Work is expected to continue until 
June 30, 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project will be evaluated by review of the proposal and 
the annual project reports.
                      agriculture water usage, ga
    Question. Please provide a description of the research that has 
been funded under the Agriculture Water Usage, GA grant.
    Answer. The Cooperative State Research, Education, and Extension 
Service has requested the university to submit a grant proposal that 
has not been completed to date, but it will be written to cover the 
period from June 1999 to June 2002.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Water has become a major issue in the southeast. The tri-
state water ``issue'' between Florida, Georgia, and Alabama is seeking 
to allocate interstate waters in the primary river basins which begin 
in the Atlanta area. These allocation formulas were to be completed by 
December of 1998, but an extension has been granted to complete the 
development of the allocation formulas by December of 1999. The salt 
water intrusion problem associated with coastal Georgia and South 
Carolina is also a major issue. Both these problems suffer from the 
lack of data on agricultural water use across the state. This program 
seeks to develop a monitoring and modeling strategy to determine how 
much water is used by agricultural irrigation. The program is designed 
to begin with Georgia and then allow expansion into neighboring states 
for a better estimate of agricultural water use.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. This is the first year of this particular grant program. 
However, the project has begun by hiring of strategic personnel for the 
monitoring program, and development of the equipment and the data base 
to be used for obtaining volunteers for the monitoring phase. This 
integrated project will involve the development of computer based 
models to take a monitoring sample and extrapolate that information for 
the entire state.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $300,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The scope of the project is of such magnitude and 
importance in Georgia that this appropriation is not sufficient to 
support the entire project effort. The state of Georgia through the 
Georgia Department of Natural Resources, Environmental Protection 
Division has appropriated $289,000 for fiscal year 1998-1999 and is 
expected to appropriate $250,000 per year for an additional four years 
to help support this project.
    Question. Where is the work being carried out?
    Answer. Research will be conducted from the University of Georgia, 
College of Agricultural and Environmental Sciences. The primary 
coordination of the program will be centered in the Biological and 
Agricultural Engineering Unit at Tifton, Georgia, but the program will 
involve input from personnel in Griffin and Athens, and researchers 
outside the University of Georgia.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This project, within the overall agricultural water use 
program, is anticipated to be completed within the original five-year 
time frame. Since this project is new, objectives have not been 
completed to date.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project is new and has not been through an agency 
evaluation.
                  alliance for food protection, ne, ga
    Question. Please provide a description of the research that has 
been funded under the Alliance for Food Protection grant.
    Answer. The fiscal year 1999 appropriation supports the 
continuation of a collaborative alliance between the University of 
Georgia Center for Food Safety and Quality Enhancement and the 
University of Nebraska Department of Food Science and Technology. 
Fiscal Year 1998 funds supported research at the University of Nebraska 
on the detection, identification, and characterization of food 
allergens, the effects of processing on peanut allergens, and 
investigation of the efficacy of using various types of thermal 
processes to reduce or destroy the toxicity and mutagenicity of certain 
Fusarium metabolites in corn and corn products. Research at the 
University of Georgia was directed toward determining the foodborne 
significance of Helicobacter pylori, determining the effect of 
antimicrobials to eliminate Arcobacter from pork, determining the 
survival of E. coli O157:H7 at reduced water activity, and using 
extrusion cooking to destroy peanut allergens. CSREES has requested, 
but has not yet received, proposals from the University of Georgia and 
the University of Nebraska in support of the fiscal year 1999 
appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the proposed research 
addresses emerging issues in food safety which have national, regional, 
and local significance. Specifically, research will address bacterial 
pathogens that can cause ulcers, cancer, and diarrheal illness, toxic 
fungal metabolites in corn products, and allergens in foods that cause 
serious reactions, including death, in sensitive people. These emerging 
issues affect consumers, the food industry, and food producers at all 
levels, national, state, and local.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The original goal of this research was to first, facilitate 
the development and modification of food processing and preservation 
technologies to enhance the microbiological and chemical safety of 
products as they reach the consumer; and second, develop new rapid and 
sensitive techniques for detecting pathogens and their toxins as well 
as toxic chemicals and allergens in foods. The University of Nebraska 
developed assays for detection of peanut, milk, egg, and almond 
residues in processed foods, produced high-quality antibodies for these 
assays, identified a soybean allergen and two sunflower seed allergens, 
discovered clues as to the reason why Brazil nuts cause severe allergic 
reactions, discovered that certain types of Fusarium fungi do not 
produce mutagenic substances, developed a simple liquid chromatographic 
procedure for determination of moniliformin toxin, found that the corn 
flake manufacturing process can reduce levels of fungal toxins such as 
aflatoxin and fumonisins, and also found that low levels of 
carcinogenic aflatoxins in corn grits might be reduced to less than 
regulatory actions levels by the corn flake manufacturing process. The 
University of Georgia developed methods to culture Helicobacter pylori, 
and detect the pathogen in foods, the effect of antibiotics on the fate 
of E. coli O157:H7 in reduced water activity conditions, and found that 
extrusion cooking can greatly reduce allergens in peanuts.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1996, 
and $300,000 was appropriated in fiscal years 1996 through 1999, for a 
total appropriation of $1,200,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were $117,000 state funds and $250,000 industry and miscellaneous in 
fiscal year 1996 and were estimated to be a minimum of $111,000 state 
funds and $305,000 industry and miscellaneous in fiscal year 1997; 
$70,000 state funds and $295,000 industry and miscellaneous funds in 
fiscal year 1998; and are estimated to be a minimum of $25,000 state 
funds and $25,000 industry funds in fiscal year 1999.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the University of Georgia 
Center for Food Safety and Quality Enhancement in Griffin, Georgia and 
at the University of Nebraska Department of Food Science and Technology 
in Lincoln, Nebraska.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives have not yet been met. The 
researchers anticipate that work will be completed on the original 
objectives in 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposals submitted in support of the appropriation on an annual basis. 
A review of the proposal from the University of Nebraska was conducted 
on January 16, 1998, and good progress was demonstrated on the 
objectives undertaken in 1997. A review of the proposal from the 
University of Georgia was conducted on January 21, 1998, and good 
progress was demonstrated on the objectives undertaken in 1997. In both 
cases, a CSREES scientist reviewed annual reports submitted by the 
cooperating institutions. These annual reports include the Principal 
Investigators' synopsis of their results, as well as listing public 
presentations of the funded research as scientific meetings and in 
peer-reviewed journals, which are other independent indicators of the 
progress made in the research.
                    alternative crops, north dakota
    Question. Please provide a description of the research that has 
been funded under the Alternative Crops, North Dakota program.
    Answer. The alternative crops project has two main thrusts--
development and utilization of alternative or novel crops and 
utilization of traditional crops. The goals of the project are to 
diversify income at the farm gate, reduce reliance on monoculture to 
help alleviate pest problems, while providing new agricultural and 
industrial products to society. Some of the new areas under 
investigation include feeding of co-products to livestock, development 
of white wheat as an alternative crop, production of certified dried 
bean seed, and borage--a perennial herb. Previous work continues with 
oilseed crops such as crambe, rapeseed, and safflower as a renewable 
supply of industrial oil, products from food crops for novel new uses 
in paints, coatings, food ingredients, and the development of new 
biochemical and enzymatic processes to refine oils for industrial uses. 
The projects funded in this appropriation are evaluated by a peer-panel 
chosen by the Associate Dean of Research at North Dakota State 
University. The internal peer review was conducted on the following 
criteria: (1) probability and extent of generating value-added 
agricultural products, (2) technical and financial feasibility, (3) 
scientific merit, (4) innovation, (5) probability of rapid 
commercialization, and (6) interdisciplinary research efforts.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that nationally, 
developing new crops and new markets for agricultural products is 
critical for both environmental and economic reasons. Enhanced 
biodiversity that comes from the successful commercialization of new 
crops aids farmers in dealing with pests and reducing the dependency 
upon pesticides. New markets are needed to provide more economic 
stability for agricultural products, especially as Federal price 
supports are gradually withdrawn. Regionally, the temperate areas of 
the Midwest have the potential to grow a great number of different 
crops but are in need of publicly-sponsored research efforts to reveal 
the most practical, efficient, and economical crops and products to 
pursue. Potential national need for this research project could 
possibly be funded by the competitive grants provided under the 
Initiative for Future Food and Agricultural Systems or the National 
Research Initiative competitive grants.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was and still is to 
introduce, evaluate, and test new crops which will broaden the economic 
diversity of crops grown in North Dakota. The primary emphasis is to 
find new crops, new uses, and create value added products, such as 
crambe, lupin, canola, safflower, cool-season grain legumes, buckwheat, 
amaranth, field pea production and utilization, transgenic sugar beets 
to produce levan, utilization and processing lupin flower, 
confectionery sunflower production, growing and marketing of carrots, 
crop-derived red food dye and high quality pectin as food ingredients, 
innovative biochemical means of splitting crop oils, and other new uses 
of oilseed crops, development of markets for new crops as livestock and 
fish feeds. These efforts have forged a strong link with the private 
sector, and successfully spawned several crops and products into 
profitable private sector businesses
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Appropriations by fiscal year are as follows: 1990, 
$494,000; 1991, $497,000; 1992 and 1993, $700,000 per year; 1994, 
$658,000; 1995, $592,000; and in 1996 through 1999, $550,000 per year. 
A total of $5,841,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In fiscal year 1991, $10,170 was provided by state 
appropriations. In fiscal year 1992, $29,158, was also provided by 
state appropriations and self-generated funds. In fiscal year 1993, 
$30,084, was provided by state appropriations. In fiscal year 1994, 
$161,628 was provided by state funds, $3,189 provided by industry and 
$9,020 provided by other sources, totaling $173,837. In fiscal year 
1995, $370,618 was provided by state appropriations, $1,496 provided by 
self-generated funds, $1,581 provided by industry, and $5,970 was 
provided in other non-federal funds, totaling $379,665 for fiscal year 
1995. In fiscal year 1996, $285,042 was provided by state 
appropriation, $4,742 provided by industry, $14,247 provided from other 
non-federal funds totaling $304,031 for 1996. In fiscal year 1997, 
$462,012 was provided by state appropriations, $8,080 was provided by 
self-generated funds, $8,217 was provided by industry, and $103,063 was 
provided from other non-federal funds totaling $581,372 for fiscal year 
1997.
    Question. Where is this work being carried out?
    Answer. The work is conducted on the campus of North Dakota State 
University and at the Carrington Research and Extension Center, 
Carrington, North Dakota, and the Williston Research Center, which are 
both in North Dakota. Work is also done in eastern Montana.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Fiscal year 1999 is the tenth year of activity under this 
grant. The primary emphasis has been to find new crops with non-food 
uses and create value added products. The original objectives have been 
met and continue to expand.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The cognizant staff scientist annually reviews the project 
and has determined that the research is conducted in accordance with 
the mission of this agency.
                alternative crops for arid lands, texas
    Question. Please provide a description of the research that has 
been funded under the Alternative Crops for Arid Lands, Texas grant.
    Answer. This grant is to develop the two most abundant plants in 
southwestern United States, i.e. mesquite and cactus, into commercial 
crops through a combination of applied research and market development. 
In Texas, New Mexico, Arizona, and California, these plants occupy 
72,000,000 acres. This grant is peer reviewed internally and external 
reviewers include a private sector cactus breeder, the Texas 
Agricultural Extension Service, and a specialist in wood products 
marketing.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this goal?
    Answer. The semi-arid regions of the United States that border with 
Mexico in Texas, New Mexico, Arizona, and California have some of the 
highest unemployment rates, lowest economic returns per acre, and 
lowest incomes in the United States. The two most abundant plant 
species in this region are prickly pear cactus and mesquite. By working 
with Mexican researchers, this grant will help to stabilize the 
economic situation of rural poor in Mexico and the United States. There 
are few crops capable of being grown sustainably in these regions. Due 
to the nitrogen fixing capability, and thus soil improving properties 
of mesquite and high water use efficiency of cactus, these plants 
contribute to sustainable agriculture and will diversify southwestern 
agriculture. This research group is the only center in the United 
States developing these plants as crops.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to dramatically improve the economic returns 
and year-to-year economic stability in the southwestern United States 
from arid and semi-aid lands. For cactus, the goal has been to provide 
improved varieties that can be harvested and processed into food and 
forage. Accomplishments include: established collection of 130 
varieties; established procedures for improving breeding; establishment 
of a new cactus plantation in the Rio Grande Valley; retail sales of a 
new vegetable cactus variety through largest retail grocery in Texas. 
Mesquite accomplishments include: presentations to architects in all 
major cities in Texas; demonstrations of mesquite products at the World 
Trade Fair in Chicago, which resulted in a new manufacturing facility 
in Texas; a potential one hundred dollars per acre annual return from a 
ten-year field study of mesquite growth. Recent research has suggested 
that a sustainable system for mesquite management can avoid land 
clearing by bulldozers and aerial herbicides in fragile and sensitive 
semi-arid landscapes by creating markets for mesquite products and 
using the tree's natural drought tolerance and nitrogen fixing 
properties.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994 
and the appropriation for fiscal year 1994 was $94,000. For fiscal 
years 1995 through 1997 the appropriation was $85,000 per year and for 
fiscal year 1999 is $100,000. A total of $449,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In fiscal year 1994, $43,215 was provided by the Texas 
legislature.
    Question. Where is the work being carried out?
    Answer. The work is being conducted by Texas A&M University, 
Kingsville, Texas.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Significant but small Texas cactus and mesquite industries 
now exist. Transformation of these small industries into medium 
industries and transfer of the arid technologies to low rainfall areas 
of the Midwestern and southeastern United States will continue 10 years 
into the next century.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Evaluation of this project is conducted annually based on 
the annual progress report and discussions with the principal 
investigator, as appropriate. The review is conducted by the cognizant 
staff scientist who has determined that this research is in accordance 
with the mission of the agency.
         alternative marine and freshwater species, mississippi
    Question. Please provide a description of the research that has 
been funded under the alternative marine and freshwater species grant.
    Answer. The research has focused on the culture of hybrid striped 
bass, freshwater prawns, hybrid crappie, and crawfish. Nutritional and 
water quality requirements and alternative management and harvest 
strategies for these species have been evaluated and field tested. 
Applied knowledge from this research will improve production efficiency 
and facilitate commercialization of these alternative species and 
provide alternative management strategies. The project undergoes peer 
review by the university and is also reviewed by the CSREES Program 
Leader on an annual basis.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher indicates that it is essential 
that alternative species and production strategies be considered to 
help the industry diversify and expand while taking advantage of 
existing infrastructure. Diversification will benefit both the producer 
and consumer of aquaculture products. Research generated from this 
grant should lead to alternative production systems that can have 
national, regional, and local impact.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to develop and 
evaluate aquaculture production technologies that would lead to the use 
of alternative species and management strategies in commercial 
aquaculture production. Research evaluating stocking rates, feeding 
regimens, nutritional requirements, and methods to reduce stress in 
hybrid striped bass production systems has led to the development of 
improved production efficiency in these systems. Recent research has 
led to improved feed formulation and feeding strategies for hybrid 
striped bass. The effects of feeding frequency and temperature on 
growth have been evaluated. Researchers have also researched management 
strategies to improve production efficiency and cost effectiveness in 
non-forage based crawfish production systems.
    Question. How long has the work been underway and how much has been 
appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
and the appropriation for fiscal years 1991-1993 has been $275,000 per 
year, $258,000 in 1994, and $308,000 each year in fiscal years 1995-
1999. A total of $2,623,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university reports a total of $332,091 of non-federal 
funding to support research carried out under this program for fiscal 
years 1991-1994, $70,636 in fiscal year 1995, $79,935 in fiscal year 
1996, $124,893 in fiscal year 1997, and $328,023 in fiscal year 1998. 
The primary source of the non-federal funding was from the state. 
Additional funding is provided from product sales, industry 
contributions, and other miscellaneous sources
    Question. Where is the work being carried out?
    Answer. Research is being conducted at Mississippi State 
University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original specific research objectives were to be 
completed in 1994. These specific research objectives have been met, 
however, the broader research objectives of the program are still being 
addressed. The specific research outlined in the current proposal will 
be completed in fiscal year 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to submit an accomplishment 
report when the new grant proposal is submitted to CSREES for funding. 
The 1998 review indicated that the research addresses an important 
opportunity in the aquaculture industry, that research objectives were 
met, that progress on previous research was well documented, and that 
the proposed research builds on the previous work funded through this 
program. The research on hybrid striped bass and crawfish funded 
through this program complements research conducted through other USDA 
programs.
                    alternative salmon products, ak
    Question. Please provide a description of the research that has 
been funded under the Alternative Salmon Products grant.
    Answer. This was a new grant in fiscal year 1998. Research was 
aimed at developing a commercial pin-bone removal machine to reduce 
production costs of salmon fillets and thus open markets for salmon 
fillet shatter packs. CSREES has requested, but has not yet received a 
proposal in support of the fiscal year 1999 appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The Alaska salmon industry has lost considerable market 
share worldwide to farmed salmon production. In 1994, the farmed salmon 
market share surpassed Alaska's market share of the world's salmon 
supply and has continued to climb every year since. In 1997, Norwegian 
farmed salmon production exceeded Alaska wild stock harvests. Also in 
1997, Chilean coho salmon exports to Japan exceeded North American 
sockeye salmon exports to Japan. Japan has traditionally been Alaska's 
strongest and most lucrative export market. The current situation is an 
example of foreign competition undermining a traditional American 
industry. Federal support of product development in this area has 
dropped from $17,300,000 to $3,000,000 nationwide, largely through a 
significant reduction in Saltonstall-Kennedy funds. USDA traditionally 
has supported fish food research primarily from aquacultured fish. The 
Alaska salmon industry is a multi-state industry. Though the product is 
harvested in Alaska, the benefits are shared with fishermen residents 
in Washington state, Oregon, California and throughout the nation.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The research goal is the development of market-desired 
salmon products using wild-caught salmon. In 1998, researchers 
addressed the problem of deboning wild-caught fish so that they can be 
marketed frozen rather than canned, and thus compete effectively with 
pen-reared salmon. Researchers designed, built, and tested three 
prototype pinbone removal machines, making sequential improvements in 
design.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998, 
with appropriations in fiscal years 1998 and 1999 of $400,000 per year 
for a total of $800,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Industry will contribute approximately $200,000, based on 
an estimated cost of $50,000 per plant, times four plants, for 
commercial testing of the beta prototypes during the summer 1998 salmon 
season in Alaska.
    Question. Where is this work being carried out?
    Answer. The work with be conducted at the University of Alaska 
Fairbanks--Fishery Industrial Technology Center in Kodiak, Alaska, and 
at the Geophysical Institute of the University of Alaska Fairbanks, in 
Fairbanks, Alaska.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional related objectives?
    Answer. The anticipated completion of the full objectives of this 
research area, including original and related objectives, will require 
about five years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The proposal received in support of the fiscal year 1998 
appropriation was reviewed for merit by a CSREES specialist on January 
21, 1998. At that time, the agency science specialist believed that the 
projects addressed needs and interests of the Alaskan salmon industry.
                 animal science food safety consortium
    Question. Please provide a description of the research that has 
been funded under the animal science food safety consortium program.
    Answer. The research goal of the Food Safety Consortium is to 
improve the safety of foods, specifically poultry and red meat 
products, consumed by humans. In order to accomplish this, the 
Consortium consists of three Universities that specialize in beef, 
poultry, and pork. In coordination, they have focused on accomplishing 
six objectives: (1) to develop techniques for rapid detection of 
infectious agents and toxins in meat and poultry; (2) to develop a 
statistical approach for evaluating potential health risks; (3) to 
identify effective intervention points to control microbiological or 
chemical hazards; (4) to develop monitoring methodologies to detect 
these hazards in the distribution chain; (5) to develop technologies to 
complement the development of Hazard Analysis and Critical Control 
Point--HACCP--programs by USDA; and (6) to estimate costs and benefits 
associated with intervention alternatives.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local need for this 
research?
    Answer. A safer meat product food supply would reduce the economic 
losses related to days away from work, medical treatment, and even 
human suffering and death as a result of foodborne illnesses. The costs 
are estimated at over $5,000,000,000 a year. The Consortium's 
participation in technology transfer to health departments and trade 
associations are helping on a regional and local level to help educate 
consumers and food handlers on safe handling procedures. Scientific-
based testing that is being developed will help provide food that will 
be accepted in international markets and increase exports and 
sustainable rural economies at home. On a regional and local level, 
each of the institutions are involved in HACCP program training for 
industry and are holding seminars for industry to discuss food safety 
research findings. In addition, the University of Arkansas is teaching 
food safety programs to children in state elementary schools. Potential 
national need for this research project could possibly be funded by the 
competitive grants provided under the Initiative for Future Food and 
Agricultural Systems or the National Research Initiative competitive 
grants.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The original goal was to bring together research and 
expertise of institutions in three states in order to best address the 
areas of poultry, beef, and pork meat production from the farm to the 
consumer's table. In coordination with each other, they seek to develop 
detection, monitoring, and prevention techniques to control or prevent 
the presence of infectious agents and chemical toxins in the food 
supply. Each year advisory and technical committees provide guidance 
and expertise in research planning. Major accomplishments occurred in 
1998. Research at the University of Arkansas emphasized risk assessment 
and analysis, chemical interventions for raw poultry, control measures 
for cooked poultry, and rapid detection methods. Major projects 
included tests that showed up to 30 percent of surveyed households with 
Salmonella-infected children had significant levels of Salmonella 
traced to non-food sources in the homes. Risk assessment models were 
developed to predict the relative reductions in the incidence of 
Salmonella-positive poultry carcasses. Control of pathogens in poultry 
also centered on thermal processing and use of bacteriocins. Three new 
bacteriocins with the ability to inhibit foodborne pathogens were 
produced. Nucleic acid probes and polymerase chain reaction assays were 
developed to detect Arcobacter and Campylobacter jejuni. At Iowa State 
University, research concentrated on swine production, swine 
processing, irradiation, methodologies of detecting bacteria, and risk 
assessment. Projects included a study of the impact of modern livestock 
production practices on the incidence of Salmonella, the use of hot 
water rinses as a method of carcass decontamination, the effect of 
irradiation on lipid oxidation and off-flavor development in cooked 
pork, and the effects of HACCP procedures on the economic costs of 
pathogens in pork production. Work performed at Kansas State University 
emphasized sampling and testing for microorganisms and intervention 
strategies for pathogen control in beef. Research with sponge sampling 
of carcasses provided information required for microbiological testing 
at large and small plants and enabled the offering of hands-on training 
for processors and inspectors. Studies of steam pasteurization found 
that the process is a viable intervention technique for reducing 
bacteria on freshly slaughtered beef carcasses. The Kansas State 
investigators also continued refining and enhancing sampling and 
testing procedures for Hazard Analysis Critical Control Point 
implementation and verification.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $1,400,000; fiscal year 1990, $1,678,000; 
fiscal year 1991, $1,845,000; fiscal years 1992-1993, $1,942,000; 
fiscal year 1994, $1,825,000; fiscal years 1995-1996, $1,743,000 each 
year; fiscal year 1997, $1,690,000; fiscal years 1998-1999, $1,521,000 
each year. A total of $18,850,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $1,313,653 State appropriations, $2,959 product sales, 
$35,600 industry, and $259,735 miscellaneous for a total of $1,611,947 
in 1991; $1,270,835 State appropriations, $10,129 product sales, 
$90,505 industry, and $267,590 miscellaneous for a total of $1,639,050 
in 1992; $1,334,680 State appropriations, $1,365 product sales, $33,800 
industry, and $356,308 miscellaneous for a total of $1,726,153 in 1993; 
$1,911,389 State appropriations, $192,834 industry, and $200,000 
miscellaneous for a total of $2,304,223 in 1994; $1,761,290 State 
appropriations, $221,970 industry, and $91,885 miscellaneous for a 
total of $2,075,145 in 1995; $2,643,666 State appropriations and 
$152,431 industry, for a total of $2,796,097 in 1996; and $1,776,167 
State appropriations and $824,378 industry, for a total of $2,600,545 
in 1997; $612,000 State appropriations and $1,238,899 industry, for a 
total of $1,850,899 in 1998. Thus, from 1991 through 1998 a total of 
$16,604,068 in non-federal funds was provided.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Iowa State University, 
Kansas State University, and University of Arkansas at Fayetteville, 
University of Arkansas for Medical Sciences at Little Rock, and 
Arkansas Children's Hospital.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The research projects from the Consortium continue to 
evolve and build on the original objectives first set out in 1989. 
Additional objectives are revised on an annual basis to enhance the 
original six objectives. For example, one of the original objectives 
was to look at risk assessment in the safety of animal food products. 
In 1998, the Consortium sent a principal investigator to work in USDA's 
Office of Risk Assessment and Cost Benefit Analysis. Another objective 
was the detection and surveillance of foodborne pathogens. Recently, 
the Consortium has participated in research projects that have made 
significant contributions to the establishment of scientific parameters 
used in HACCP programs. The principal investigators have developed 
patented tests that have significantly reduced the time necessary to 
detect pathogens in the processing plants. The Food Safety Consortium 
continues to use peer evaluated projects to address priority issues.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. There has never been a formal evaluation of the Food Safety 
Consortium but instead, a annual conference is organized where a 
designated representative from CSREES attends. The annual conference 
was held in October, 1998. Along with other invited agency 
representatives such as FSIS, ARS, and ERS, CSREES participates in a 
steering committee meeting which critiques projects and discusses 
research priorities. CSREES representatives were considered part of the 
Technical Advisory Committee as well as members of the Food Safety 
Consortium Steering Committee and fully participated in meetings and 
conference calls. The individual projects are also peer reviewed. The 
peer review results, by expert scientists who are not members of the 
Consortium, determine those projects selected for funding.
                apple fire blight, michigan and new york
    Question. Please provide a description of the research that has 
been funded under the Controlling Fire Blight Disease of Apple Trees, 
Michigan and New York, grant.
    Answer. This project studies fire blight in apple trees, which is a 
bacterial disease that can kill spurs, branches, and whole trees. The 
management of this disease is difficult because only one antibiotic 
treatment is available. The objectives of this research are to develop 
fire blight resistance varieties, evaluate biological and chemical 
control methodologies for disease management, and develop an education 
and extension component for disease management.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Fire blight is a destructive disease of apple trees that 
can kill the trees. This disease is caused by bacteria and effects 
apple trees in all apple growing areas of the nation. In the northeast, 
the disease is more prevalent because of humid weather conditions. The 
principal researcher believes this research to be of national, 
regional, and local need.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals of this research are to develop transgenic apple 
trees through various molecular technologies, to develop new approaches 
to antibiotic treatments of disease, to develop an early screening 
technique for tree sensitivity to the disease, to evaluate biological 
and cultural controls, and to develop and improve education and 
extension components of disease management. The last objective involves 
using disease prediction models.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. fiscal year 1997 was the first year funds were appropriated 
for this grant at $325,000. For fiscal year 1998-1999, $500,000 was 
appropriated per year. A total of $1,325,000 has been appropriated.
    Question. What are the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds for 1997 were $40,127 for Michigan 
and $104,166 for New York State. The funds for 1998 are state 
appropriated at $25,071, and $15,000 in funds from the Michigan Apple 
Research Committee for a total of $40,071 from Michigan whereas New 
York is estimating state appropriated funds at $104,166 for 1998. The 
state appropriated funds for 1999 are $49,771 for Michigan, and New 
York is estimating state appropriated funds at $106,689 for 1999.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Michigan State University 
and Cornell University, New York Experiment Station.
    Question. What is the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated date of completion for the original 
objectives was 1998. The objectives have not been met. It is estimated 
by the researchers that three to five years is need to complete this 
project.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last merit review of this project was in January, 1998. 
In summary, the evaluation indicated that progress was demonstrated in 
all the objectives. In New York, rootstock transformation was 
successful in two commercially-important apple varieties and another 
transgenic line preformed well in field trails. The use of the hrpN 
gene for resistance to fire blight was used to produce transgenic lines 
in apple. Biological control agents, systemic acquired resistance 
inducers, and bactericides were evaluated for their use in integrated 
pest management of fire blight. Commercial orchards were mapped for 
tree loss due to fire blight rootstock infection, and the internal 
movement of fire blight through healthy apple scion tissue was 
investigated. In Michigan, bacteriophages were used as potential 
biological control agents for fire blight control on apple trees under 
field conditions. Management of fire blight was evaluated using 
chemical growth regulation and induced resistance strategies. The 
effects of hrpA genese on elicitation of the HR and causation of the 
fire blight was studied using Arabidopsis and immature pear as a model.
                         aquaculture, louisiana
    Question. Please provide a description of the research that has 
been funded under the Aquaculture, Louisiana grant.
    Answer. Research has focused on catfish, crawfish, and hybrid 
striped bass in commercial aquaculture. Research has included basic and 
applied research in the areas of production systems, genetics, aquatic 
animal health, nutrition, off flavor, water quality, and germplasm 
preservation. Grants are awarded to scientists within the university on 
a competitive peer review basis. The entire proposal is also reviewed 
by the CSREES Program Manager on an annual basis.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher indicates that improved production 
efficiency and product safety and quality for a number of important 
aquaculture species will enhance the profitability and sustainability 
of the aquaculture industry in the region. The research funded through 
this program focuses on the production of a number of important 
aquaculture species such as catfish, crawfish, and hybrid striped bass. 
Aquaculture research at national centers is supported through Regional 
Aquaculture Center grants.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the research was to provide science-
based information through a basic and applied research base that 
specifically addressed the needs of the aquaculture industry in 
Louisiana and the southern states. The university has completed studies 
in the area of fish nutrition, fish health, fish genetics, production 
management strategies, alternative species, seafood processing, product 
quality, and broodstock development. Research has led to improved 
channel catfish and hybrid striped bass feed formulations, production 
of new channel catfish vaccines, improved extraction and detection 
methods for the off-flavor compounds, production of genetically-
improved channel catfish with increased resistance to bacterial 
infection, developed procedures for production of gene maps for channel 
catfish, improved harvesting and production strategies for crawfish, 
and improved processing technologies for crawfish and other aquaculture 
products. Research continues to be directed at important opportunities 
to enhance production efficiency and the commercial viability of 
sustainable aquaculture systems in the region.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Research to be conducted under this program will continue 
as initiated under the Aquaculture General program in fiscal years 1988 
through 1991. The work supported by this new grant category began in 
fiscal year 1992 and the appropriation for fiscal years 1992-1993 was 
$390,000 per year, $367,000 in fiscal year 1994, and $330,000 each year 
in fiscal years 1995-1999, for a total of $2,797,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates that non-federal funding for this 
program is as follows: in fiscal year 1991, $310,051; in fiscal year 
1992, $266,857; in fiscal year 1993, $249,320; in fiscal year 1994, 
$188,816; in fiscal year 1995, $159,810; in fiscal year 1996, $150,104; 
in fiscal year 1997, $158,808; and in fiscal year 1998, $110,101. The 
primary source of this funding was from state sources and self-
generated funds with minor contributions from industry and other non-
federal sources.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Louisiana State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original specific objectives were to be completed in 
1990. These specific research objectives have been met, however, the 
broader objectives of the research program are still being addressed. 
The specific research outlined in the current proposal will be 
completed in fiscal year 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to provide an accomplishment 
report each year when the new grant proposal is submitted to CSREES for 
funding. In addition, the CSREES program manager conducted site visits 
in 1996 and 1997 to meet with the scientists involved in the project 
and review the progress of the research. The 1998 review of the project 
indicated that the research is addressing important research needs of 
the aquaculture industry, that the facilities are excellent, that the 
principal investigators are well qualified, that the experimental 
design is sound, that the proposed research represented a logical 
progression of research previously funded through this program, and 
that the progress on previous research funded under this program is 
well documented. The 1999 CSREES review will be completed within three 
weeks of submission of the proposal. The researchers are asked to the 
develop a research proposal consistent with the National Science and 
Technology Council's Strategic Plans for Aquaculture Research and 
Development. Research results from this program have had a significant 
impact on the aquaculture industry in Louisiana and the region.
      aquaculture product and marketing development, west virginia
    Question. Please provide a description of the research that has 
been funded under the Aquaculture Product and Marketing Development, 
West Virginia.
    Answer. The proposed study is aimed at developing a viable and 
competitive aquaculture industry in West Virginia and Appalachia. 
Specific research strategies include the development of marketing 
strategies for trout producers and processors, increasing the economic 
efficiency and profitability of trout-based enterprises, improving the 
consistency and quality of fresh trout fillets, and of value-added 
smoked trout products. The proposal also contains a technology transfer 
component to disseminate information generated by the project. The 
proposal represents a significant investment for a new initiative under 
the Special Research Grants Authority. CSREES did not approve the 
original proposal and has requested a revised proposal.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The researchers indicate that there is a regional and 
national need to evaluate marketing and product development for small 
scale aquaculture systems in rural communities. In addition there is a 
need to improve the efficiency and sustainability of these systems. The 
researchers also indicate that the proposed research is consistent with 
the National Science and Technology Council's Strategic Plan for 
Aquaculture Research and Development.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The proposed research represents a new initiative aimed at 
developing sound marketing strategies for aquaculture products in the 
region, improving the economic efficiency of aquaculture production 
systems, and improving the quality, and variety of aquaculture products 
in the region. CSREES has conducted an in-depth peer review of the 
proposal and has recommended that the university submit a revised 
proposal that addresses concern expressed by the reviewers and the 
CSREES Program manager.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. A grant has been awarded from funds appropriated as 
follows: fiscal year 1998, $600,000 and fiscal year 1999, $750,000. A 
total of $1,350,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates that significant non-federal 
funding will be provided in fiscal year 1998 primarily from state 
sources to cover the salaries of the principal investigators. As the 
program develops, additional non-federal funding is expected.
    Question. Where is this work being carried out?
    Answer. The research would be conducted at the University of West 
Virginia in Morgantown and at off campus sites with a variety of 
potential cooperators.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is fiscal year 2000. The project was initiated in fiscal year 1998.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES conducted an external and internal peer review of 
the original proposal. The proposal was peer reviewed by 10 external 
reviewers and the CSREES National Program leaders for Aquaculture, and 
the CSREES Aquaculture Program Specialist. Although the proposal was 
aimed at important issues facing the aquaculture industry in the 
region, a number of significant concerns were expressed by the 
reviewers and CSREES Program Leaders. These concerns with 
recommendations were presented to the University, and a revised 
proposal was requested. CSREES has withheld authority of the University 
to utilize funds until an acceptable proposal has been submitted and 
approved by the agency. CSREES is currently awaiting receipt of the 
revised proposal.
             aquaculture research, stoneville, mississippi
    Question. Please provide a description of the research funded under 
the aquaculture research Stoneville, Mississippi grant.
    Answer. The primary objectives of this research have been to 
improve practical feeds and feeding strategies that enhance fish health 
and production efficiency in channel catfish ponds. Additionally, 
scientists are evaluating the application of acoustical instrumentation 
in commercial aquaculture. The project undergoes peer review by the 
university and by the CSREES Program Leader on an annual basis.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher indicates that the research 
findings from this project have a direct impact on the profitability 
and sustainability of a significant segment of the domestic aquaculture 
industry. The farmed-raised catfish industry accounts for over 55 
percent of the total U.S. aquaculture industry. Research funded by this 
program is directed towards improved feeds and feeding strategies. In 
addition, research is directed towards acoustical monitoring and 
inventory of catfish in pond production systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to address the 
research needs of the catfish industry in the areas of water quality 
and nutrition. The research has led to improved water quality 
management practices in commercial catfish ponds. Research in the area 
of catfish nutrition has led to improved diet formulation and feeding 
strategies that have been widely adopted by the industry. Scientists 
are currently evaluating vitamin supplementation in catfish feed 
formulations using conditions that closely reflect commercial 
production ponds. Research findings from this program have had a direct 
impact on least-cost feed formulations utilized by commercial feed 
mills resulting in reduced cost of commercial feeds without reducing 
performance and productivity. Scientists are also evaluating feed 
delivery techniques to improve feed conversion efficiency. Studies 
evaluating acoustical instrumentation have demonstrated possible 
applications in commercial aquaculture. Researchers are developing 
sonar electronics hardware and computer-generated graphics 
communications interface software for the application of monitoring 
count and size of channel catfish in the pond.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1980-1981, $150,000 per year; fiscal year 1982, 
$240,000; fiscal years 1983-1984, $270,000 per year; fiscal year 1985, 
$420,000; fiscal years 1986-1987, $400,000 per year; fiscal year 1988, 
$500,000; fiscal year 1989, $588,000; fiscal year 1990, $581,000; 
fiscal year 1991, $600,000; fiscal years 1992-1993, $700,000 per year; 
fiscal year 1994, $658,000; fiscal years 1995-1997, $592,000 each year; 
$642,000 in fiscal year 1998; and $592,000 in fiscal year 1999. A total 
of $9,637,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates a total of $2,101,508 in non-
federal funding to support this research for fiscal years 1991-1994; 
$1,128,451 in fiscal year 1995; $601,473 in fiscal year 1996; $463,990 
in fiscal year 1997; and $464,266 in fiscal year 1998. The primary 
source of non-federal funding is from the state. Additional funding is 
provided from product sales, industry contributions, and other 
miscellaneous sources.
    Question. Where is this work being carried out?
    Answer. The grants have been awarded to the Mississippi 
Agricultural Experiment Station. All research is conducted at the Delta 
Branch Experiment Station, Stoneville, Mississippi. The acoustical 
research in aquaculture is conducted in cooperation with the National 
Center for Physical Acoustics at the University of Mississippi.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the specific original 
research objectives was 1984. These specific research objectives have 
been met, however, the broader research objectives of the program are 
still being addressed. The specific research outlined in the current 
proposal will be completed in 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to provide an accomplishment 
report when the new proposal is submitted to CSREES for funding. CSREES 
Program manager conducted a site visit in 1998. The 1998 review 
indicated that the research targets important opportunities in the 
farm-raised catfish industry. Significant progress has been reported on 
past research and the experimental and scientific design of the new 
project are sound. Scientists involved in the project are leading 
authorities in this area of research and linkages between the 
researchers and the catfish industry has lead to accelerated adoption 
of research findings. Adoption of improved feeds and feeding strategies 
developed through this program by the catfish industry has led to 
improved production efficiency in commercial catfish operations. CSREES 
is planning a comprehensive review of the catfish research program at 
Mississippi State University in late 1999.
                         aquaculture, virginia
    Question. Please provide a description of the research that has 
been funded under the Aquaculture, Virginia grant.
    Answer. The proposal research will document and develop fish 
production parameters and culture methods, analyze management 
economics, and provide information on industry marketing and economic 
development of a recirculating aquaculture system-based industry.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The investigators indicate that there is a need to develop 
a highly competitive, sustainable aquaculture industry to meet consumer 
demand for cultivated aquatic foods that are of high quality, safe, 
competitively priced, nutritious, and are produced in an 
environmentally-responsible manner with maximum opportunity for 
profitability in all sectors of the industry.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. Program objectives include research to identify 
commercially-viable aquaculture species utilizing recirculating 
aquaculture system technology, verify production and culture management 
protocols utilizing this technology, analyze production budgets 
providing information to build business plans, investigate marketing 
development strategies, and prepare scientific, technical, and popular 
publications to disseminate the results of this research. This is a new 
research initiative and the year one proposal is currently under review 
by CSREES.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This is a new research initiative and the appropriation for 
fiscal year 1999 is $100,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates a minimum of $90,000 of non-
federal funding in fiscal year 1999 primarily from state sources. As 
the program develops, additional non-federal funding is expected.
    Question. Where is this work being carried out?
    Answer. The research will be conducted through the Virginia 
Agricultural Experiment Station, Virginia Polytechnic Institute and 
State University, Blacksburg, Virginia, and in collaboration with 
private aquaculture firms in Virginia.
    Question. What was the anticipated completion date for the original 
objective of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This proposal seeks funding for year one of a proposed 
three year project. The anticipated completion date for the fiscal year 
1999 component of the project is July 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This is a new research initiative and the year one proposal 
is currently under review by CSREES. The agency will evaluate the 
progress of this project on an annual basis. The university will be 
required to submit an accomplishment report each year when the new 
proposal is submitted to CSREES for funding.
   babcock institute for international dairy research and development
    Question. Please provide a description of the research that has 
been funded under the Babcock Institute grant.
    Answer. The Babcock Institute for International Dairy Research and 
Development was established with participation of the University of 
Wisconsin-Madison College of Agriculture and Life Sciences, School of 
Veterinary Medicine, and the Cooperative Extension Division. The 
objective of the Babcock Institute is to link the U.S. dairy industry 
with the rest of the world through degree training, continuing 
education, technology transfer, adaptive research, scientific 
collaboration, and market analysis.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the need is to strengthen 
dairy industries around the world, to enhance international commercial 
and scientific collaborative opportunities for the U.S. dairy industry, 
and to draw upon global perspectives to build insight into the 
strategic planning of the U.S. dairy industry.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the Institute remains the linkage of the U.S. 
dairy industry with the rest of the world through training, continuing 
education and outreach, technology transfer, adaptive research, 
scientific collaboration and market analysis. Initial efforts were 
focused on planning and staffing. An initial activity was, and 
continues to be, the development of multi-language extension materials 
about basic management techniques essential to optimize performance of 
U.S. dairy cattle overseas. This activity has grown to include manuals 
on Breeding and Genetics, Lactation and Milking, and Basic Dairy Farm 
Financial Management published in English, Spanish, French, Russian, 
and Chinese. Research on potential implications of NAFTA and GATT on 
the U.S. dairy industry was completed. A technical workshop on dairy 
grazing in New Zealand and the mid-west was organized and held in 
Madison during the fall of 1993. A technical workshop on Nutrient 
Management, Manure, and the Dairy Industry: European Perspectives and 
Wisconsin's Challenges was held in Madison, Wisconsin during September, 
1994. A round table was held in January, 1995 addressing ``World Dairy 
Markets in the Post-GATT Era''. Sponsored the Great Lakes Dairy Sheep 
Symposium in 1995 and 1996. Created a World Wide Web site in 1996 for 
distribution of Babcock Institute technical dairy fact sheets in four 
languages. The first International Dairy Short Course for a group of 
producers and technicians from Argentina has been organized on the 
University of Wisconsin Campus. Scientist's are being supported in 
collaborative research with New Zealand primarily to gain a better 
understanding of grazing systems as related to dairy management. An 
analysis of the impact of changes in European dairy policies has been 
completed. The Institute sponsored a Minnesota-Wisconsin Dairy Policy 
Conference to provide insights into current agricultural programs and 
policy issues in the dairy sector of the U.S. economy.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1992 and 1993, $75,000 per year; fiscal year 
1994, $250,000; fiscal years 1995-1998, $312,000 per year, and fiscal 
year 1999, $400,000. A total of $2,048,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. During fiscal year 1992, $13,145 of State funds were used 
to support this program and $19,745 of State funds in fiscal year 1993 
for a total of $32,890 during the first two years of this research. 
Information is not available for fiscal years 1994-1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the University of Wisconsin-
Madison College of Agriculture and Life Sciences.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Babcock Institute's overarching mission has been to 
link the U.S. dairy industry and its trade potential with overseas 
dairy industries and markets. The original objectives of this project 
have remained consistent over the years. However, each year specific 
objectives were proposed to further the mission of the Institute and to 
build on previous accomplishments. The Institute has accomplished 
specific objectives each year in a timely manner. The Babcock Institute 
has remained true to its original objective of linking Wisconsin and 
the U.S. to dairy industries around the world. This objective remains 
of increasing importance with continued development of international 
markets for dairy products and technologies. The University researchers 
anticipate that work currently in progress will be completed by 
September, 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Babcock Institute undergoes two independent review 
processes each year. The first is done by a committee of university and 
industry representatives who review the annual research proposal and 
amend it prior to submission to the agency. The annual proposal is 
reviewed by agency technical staff prior to approval for fund release. 
In addition, the institute was included in a comprehensive review of 
the programs of the Department of Dairy Science at the University of 
Wisconsin in May, 1995. The agency project officer has conducted two on 
site reviews of the institute since it's formation in 1992. The most 
recent review has found that the approach proposed by the researchers 
is appropriate and that the researchers are well qualified to perform 
the objectives as stated. The objectives of the proposal are within the 
mission of the USDA and the Cooperative State Research, Education, and 
Extension Service.
        binational agricultural research and development program
    Question. Please provide a description of the research that has 
been funded under the Binational Agricultural Research and Development 
Program--BARD--grant.
    Answer. The Binational Agricultural Research and Development 
Program is a competitive grants program that supports agricultural 
research of importance to both the United States and Israel. The areas 
of research supported by the BARD program include plant and animal 
sciences, water and soil science, aquaculture, agricultural economics, 
and agricultural engineering. Research projects submitted for funding 
must involve collaboration between U.S. scientists and Israeli 
scientists. The funds available through the BARD Special Research 
Grants Program are used to support Land-Grant university scientists in 
the U.S. portion of projects receiving BARD awards.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. All proposals receiving awards through the BARD Program 
have national, regional, and/or local significance to agriculture in 
both the United States and Israel. Thus, applicants must convince the 
review panel of the global significance of the proposed work in order 
to receive funding. The fundamental research supported by the BARD 
program provides the knowledge base needed to solve important 
agricultural problems in the U.S. and Israel as they arise.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the BARD program is to support fundamental 
research that is important to agriculture in both the U.S. and Israel. 
Many fundamental discoveries and accomplishments have been made in the 
research areas supported by BARD. These discoveries and accomplishments 
will lead to reduction of livestock diseases, increased livestock 
production, improved production of plants under harsh environmental 
conditions, and improved resistance of plants to disease. The 
scientific quality of BARD-supported research is reflected in its 
publication record. During the past decade, nearly 2,000 papers were 
published in more than 200 refereed scientific journals. More than 38 
percent appeared in ``high impact'' journals, including prestigious 
scientific journals and another 30 percent appeared in the top 
agricultural research journals. On average, each project produced five 
refereed publications. In addition, there was an even larger number of 
presentations at the professional conferences, congresses, symposia, 
and workshops. In the period 1979 through 1998, a total of 820 grants 
were awarded, over 1,000 scientific articles were published, and 8 
patents awarded.
    Several examples of BARD projects include:
  --Work supported by the BARD program at the University of Florida 
        resulted in the DNA sequencing of the citrus tristeza virus. 
        This virus has caused major economic losses to the citrus 
        industry in both the U.S. and Israel. The sequencing 
        information can now be used to develop effective methods to 
        protect citrus trees by creating safe strains of the virus that 
        project the trees from disease-causing strains.
  --Bovine Genetics. Innovative statistical methods were developed to 
        analyze variation and heritable traits in dairy cattle and to 
        improve classical dairy breeding programs. In addition, 
        continuation projects have initiated a shift from statistical 
        analyses of heritability to genome mapping. This has directly 
        contributed to the international bovine genome mapping program.
  --Control of Fungal Diseases. Molecular approaches were employed to 
        produce new commercial tomato varieties with resistance to 
        several important fungal diseases. These new varieties are used 
        commercially worldwide. The study helped explain the genetic 
        diversity of the widespread pathogenic strains of the Fusarium 
        fungus and identified unique DNA sequences that led to the 
        development of diagnostic probes that enable precise 
        identification of the virulent forms of the fungus.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. In 1977, an agreement was signed between the U.S. and 
Israeli governments which established BARD. An initial endowment fund 
of $80,000,000 was established through equal contributions from each 
country. Subsequently, that endowment was increased by $30,000,000 for 
a total of $110,000,000. Funds for BARD are available from the interest 
earned on that endowment. In the early part of this decade, a reduction 
in interest rates, combined with increased research costs, impeded the 
ability of the BARD program to adequately meet the agricultural 
research needs of each country's producers and consumers. In fiscal 
year 1994, the Department directed that $2,500,000 of funding, which 
had been appropriated for CSREES's National Research Initiative 
Competitive Grants Program, be used for the BARD Program to supplement 
the interest earned from the endowment. The supplementary funds were 
matched by Israel. In fiscal year 1995, Congressional language directed 
that CSREES again use $2,500,000 of the National Research Initiative's 
appropriation for BARD, and in fiscal year 1996, the Department 
directed that a third $2,500,000 increment of the National Research 
Initiative's appropriation be used for BARD. CSREES received a direct 
appropriation in the amount of $2,000,000 for BARD in fiscal year 1997, 
$500,000 in fiscal year 1998, and $400,000 in fiscal year 1999.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The supplemental funds provided by CSREES are matched each 
year by the Israeli government. Each BARD grant funded by CSREES is for 
supporting Land-Grant university scientists in the U.S. portion of a 
collaborative project between U.S. and Israeli scientists. The Israeli 
portion of the project is supported by supplemental funds from Israel 
or from interest on the endowment. Therefore, half of each project is 
supported by non-federal funds.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objective of BARD is to support fundamental science of 
importance to agriculture in the U.S. and Israel. The generation of 
knowledge and the need for scientific research was seen as an ongoing 
process. The trust fund was established to provide a long-term source 
of funding to conduct research of high priority to both the U.S. and 
Israel. The creators of the BARD program determined that a 10-year 
review should be conducted to ensure its relevance and impact. The 10-
year external review panel strongly endorsed the success of BARD and 
recommended its continuance and enhancement. Due to the ongoing nature 
of scientific research, the annual funding of grant awards is focused 
on development and application of state-of-the-art science. Each grant 
project is funded for two or three years, and the results feed into the 
greater scientific body of knowledge generated by these and other 
scientists.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The USDA and the Israeli Ministry of Agriculture conducted 
a 10-year External Review of the BARD program and published the report 
in September of 1988. The objective of that external review was to 
evaluate the effectiveness of BARD and the suitability of its concept 
for bi-national collaborative research. The report concluded that the 
BARD program had achieved its objectives. The Report of the Review 
Committee concluded that ``BARD is working very well, with extremely 
high efficiency.'' ``Its organization is robust and its scientific, 
technological, and economical achievements are outstanding.'' ``The 
project evaluation and management infrastructure has been paramount in 
allowing BARD's programs to evolve and flourish.'' The Report made 
recommendations relative to operational procedures for managing the 
grant proposals and emphasized the need for increasing the corpus of 
the endowment. BARD is now undergoing a 20-year external review. The 
review will evaluate the scientific and economic impact of the 
program's funded research as well as its general operations.
                      biodiesel research, missouri
    Question. Please provide a description of the research that has 
been funded under the biodiesel research grant.
    Answer. Research on biodiesel involves examining the feasibility of 
producing biodiesel and other higher value products from oilseed crops 
including soybeans, canola, sunflower, and industrial rapeseed. The 
project is also evaluating local processing plants whereby farmers 
could produce crops and process the crops locally and use the fuel and 
high protein feed coproducts on their farms or locally. This project 
undergoes merit review at the College of Agriculture.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The initial work is being conducted in Missouri. The 
results may provide the agricultural community with alternative crops 
and more diverse markets, additional marketable products, and a locally 
grown source of fuel. This will result in increased investment in local 
communities, additional jobs, and increased value added in the farm and 
rural community sectors.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals were to examine the feasibility of producing 
biodiesel and other higher value products from oilseed crops, plus to 
increase the value of coproducts. Results indicate that biodiesel can 
be produced most economically from soybeans, primarily because of the 
high value of soybean meal. Since small quantities of biodiesel 
regularly sell for at least $4.00 per gallon, the structure of the 
production, marketing, and transportation is currently under evaluation 
to identify more efficient and less costly ways to produce and market 
biodiesel. Also, a study of which markets might provide the best 
opportunity to use increased levels of biodiesel is underway. Such 
markets might include underground mining and the marine industry in 
addition to urban mass transit systems and cities having problems 
meeting more stringent air quality mandates. Research results indicate 
that for each one million gallons of biodiesel used by the Kansas City, 
Missouri, transit fleet in a B20 blend consisting of 20 percent 
biodiesel and 80 percent petroleum-based diesel, the estimated impacts 
would be: almost 100 additional jobs; increased investment of $500,000; 
net increase in personal income of $3,200,000; and increase in total 
economic activity in the region of $9,600,000. Research has also 
identified that rapeseed meal compares favorably to soybean meal and 
blood meal as an animal feed. It has a higher escape protein value than 
soybean meal. This research is carried out in close cooperation and 
coordination with other state and Federal agencies, plus trade 
associations such as the National Biodiesel Board, the United Soybean 
Board, American Soybean Association, and others.
    Question. How long has this work been underway, and how much has 
been appropriated by fiscal year, through fiscal year 1999?
    Answer. The work for this program began in fiscal 1993, and the 
appropriation for that year was $50,000. The appropriation for fiscal 
year 1994 was $141,000; and for fiscal years 1995 through 1999, 
$152,000 annually. A total of $951,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The source of non-federal funds is state appropriated 
funds. The level in 1994 was $7,310. The funding level for 1995 was 
$74,854. Cost sharing by the University of Missouri each year for 
fiscal year 96 and fiscal year 97 was $80,000 and $86,000, 
respectively. Total cost sharing for the project by the University of 
Missouri has been $242,224. Additionally, some work funded by this 
grant has been conducted in cooperation with the National Biodiesel 
Board, plus the Missouri Soybean Merchandising Council.
    Question. Where is this work being carried out?
    Answer. The work is being carried out at the University of 
Missouri-Columbia.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principals estimate that the work with biodiesel will 
require an additional two years to complete. Additionally, the work on 
higher value products, such as solvents from biodiesel, is expected to 
be ongoing. Successes with the higher value products will result in 
more value added opportunities for farmers and rural communities. Also, 
much of the work in commercializing biodiesel has been with the B20, 20 
percent blend, with petroleum-based diesel. This biodiesel research is 
evaluating the use of biodiesel in much smaller blends, such as one 
percent or one-half percent. At this use level, biodiesel would be 
considered an additive rather than as a fuel extender. With this 
scenario, the primary benefit would be a cost-competitive lubricant 
with superior performance characteristics, thereby making the product 
more valuable as a lubricant that as a fuel.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The evaluation of using biodiesel as a complete fuel and in 
a blend has been met. This project is evaluated on an annual basis 
based on the annual progress report, discussions with the principal 
investigator as appropriate, and agency participation in collaborative 
activities related to this project. The review is conducted by the 
cognizant staff scientist, and it has been determined that the research 
is performed in accordance with the mission of this agency.
                      brucellosis vaccine, montana
    Question. Please provide a description of the research that has 
been conducted under the Brucellosis Vaccines, Montana grant.
    Answer. This project will study the immune response of bison to 
Brucella abortus bacteria and then develop a vaccine that will be 
effective in stimulating an immune response in bison. The second part 
of the project will be to incorporate the appropriate antigens in a 
novel delivery system utilizing the binding of bacteria carrying these 
antigens to forage type grasses.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for the 
research?
    Answer. The research project is intended to develop a strategy for 
vaccinating or immunizing cattle against brucellosis by incorporation 
of Brucella abortus genes into forage plants. The cattle eat the plants 
containing the bacterial proteins and then develop an immunity against 
the bacteria, thus preventing any infection following exposure to the 
bacteria.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the project will be to accomplish 
incorporation of Brucella genes which code for specific antigens into 
forage plants and have the genes expressed so that the desired proteins 
are produced. The project is expected to be funded and started in May, 
1999.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work is just being initiated in fiscal year 1999 and 
the appropriation for fiscal year 1999 is $150,000.
    Question. What is the source and amount of non-federal funds by 
fiscal year?
    Answer. The source and amount of non-federal funds for fiscal year 
1999 can not be determined until after the end of the fiscal year.
    Question. Where is this work being performed?
    Answer. The work is being performed at Montana State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
was May, 2002 or three years from the initiation of the project.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. As the project is just being started, there has been no 
evaluation as yet.
        center for animal health and productivity, pennsylvania
    Question. Please provide a description of the research that has 
been funded under the Center for Animal Health and Productivity grant.
    Answer. This research is designed to reduce nutrient transfer to 
the environment surrounding dairy farms in the Chesapeake Bay 
watershed. Progress to date includes the development of an individual 
dairy cow model which will predict absorbed amino acids and the loss of 
nitrogen in manure. This model has been developed into user friendly 
software so that trained farm advisors can evaluate herd nutrient 
management status while on a farm site. A whole farm model has been 
developed which integrates feeding and agronomic practices to predict 
utilization of nitrogen and farm surpluses. Using these tools, a survey 
of dairy farms in the region has been done to assess nitrogen status on 
dairy farms and potential management practices to reduce nitrogen 
excesses on dairy farms. Refinement of the model tools and research to 
refine estimates of the environmental fate of excess nitrogen from 
dairy farms is in progress. Two on-site reviews of the program have 
been conducted by the CSREES Project Officer and a third is planned 
during 1999. The animal and farm models have been published in peer 
reviewed scientific journals.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that reducing non-point 
pollution of ground and surface water by nitrogen from intensive 
livestock production units is of concern nationally, and especially in 
sensitive ecosystems like the Chesapeake Bay. This research is designed 
to find alternative feeding and cropping systems which will reduce net 
nutrient flux on Pennsylvania dairy farms to near zero.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research remains the development 
of whole farm management systems which will reduce nutrient losses to 
the external environment to near zero. To date the researchers have 
developed their own models to more accurately formulate rations for 
individual dairy cows which permit the comparison of alternative 
feeding programs based upon both maximal animal performance and minimal 
nutrient losses in animal waste. This model is being tested on select 
commercial dairy farms to evaluate the extent to which total nitrogen 
losses in manure can be reduced without impacting economic performance 
of the farm. At the same time, whole farm nutrient models have been 
developed to evaluate alternative cropping systems which will make 
maximum use of nutrients from animal waste and minimize nutrient flux 
from the total farm system. These tools are currently being used to 
survey the current status of nutrient balance on farms in the area and 
efforts to fine tune the tools are in progress.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. A grant has been awarded from funds appropriated in fiscal 
year 1993 for $134,000 and in fiscal year 1994 for $126,000. In fiscal 
years 1995-1999, $113,000 has been appropriated each year. A total of 
$825,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. This information is not available at the present time.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the University of 
Pennsylvania, College of Veterinary Medicine.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The University researchers anticipate that work currently 
underway will be completed by September, 1999. This will complete the 
original objectives of the research. The principal researcher indicates 
that consideration has been given to the broadening of objectives to 
include additional nutrients in the model system, but this has been 
dropped because technical expertise required is currently not readily 
available.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Center for Animal Health and Productivity project was 
last reviewed in June, 1997. An on-site review by agency technical 
staff was conducted in June, 1995. It was concluded that project 
objectives are within the goals of the program, are within the mission 
of both the USDA and CSREES, and the institution is well equipped and 
qualified to carry out the research project. The institution has made 
excellent progress towards the completion of the original goals of the 
project, but still must evaluate the effectiveness of the use of the 
new tools developed in reducing nutrient runoff from commercial dairy 
farms in the watershed of the Chesapeake Bay.
              center for innovative food technology, ohio
    Question. Please provide a description of the research that has 
been funded under the Center for Innovative Food Technology grant.
    Answer. Funds from the fiscal year 1998 grant are supporting 
research projects on using neural network/fuzzy logic tools to develop 
a model of a growing and processing cycle for canning tomatoes, using 
electrostatic coating for snack foods and baked goods, combining 
several non-thermal processing techniques to sterilize low acid liquid 
foods, using Near Infrared reflectance systems to measure protein and 
ash content in wheat flour, using membrane separation systems to 
produce extended shelf life milk products, and developing a protocol 
for testing the microbial load of ingredients in meat processing 
facilities. fiscal year 1998 funds are supporting research from March 
1, 1998, through February 28, 1999. CSREES has requested, but not yet 
received, a proposal in support of the fiscal year 1999 appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the value-added food 
processing industry is the largest industry in Midwestern states, 
including Ohio where the industry contributes over $17,000,000,000 to 
the annual economy. From an economic development point of view, 
processing and adding value to crops grown within a region is the 
largest possible stimulus to that region's total economic product. This 
program aims to partner with and encourage small and medium-sized 
companies to undertake innovative research that might otherwise not be 
undertaken due to risk aversion and limited financial resources for 
research and development in these companies. The principal researcher 
believes that, although the initial impact of this research will be 
regional, the recipient organization of this grant is part of a 
technology transfer network and proactively seeks opportunities to 
deploy technologies developed through this research to the food 
industry on a national basis. Research on value added products of 
national significance could potentially be supported by competitive 
grants awarded under the National Research Initiative or under the 
Initiative for Food and Agricultural Systems.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The original goal of the research was to develop innovative 
processing techniques to increase food safety and quality or reduce 
processing costs. The neural network project has developed a model for 
predicting the harvesting time that will optimize product quality and 
economic return to the grower, processor, and consumer. The coating 
project has demonstrated the shelf life, sanitation, and product cost 
advantages available through the use of this technology. The filtration 
project will allow fluid milk processors to lower their costs and 
increase water quality by removing high Biological Oxygen Demand 
materials from municipal treatment systems. The sterilization project 
will lower processing costs by increasing the shelf life of liquid 
products. The extended shelf life project has resulted in the marketing 
of single serving, long shelf life milk products, and the Near Infrared 
project will allow flour millers to develop improved process control 
systems.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1995. 
The project received appropriations of $181,000 in fiscal years 1995 
through 1997, $281,000 in fiscal year 1998, and $381,000 in fiscal year 
1999. A total of $1,205,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In fiscal year 1995, non-federal funds included $26,000 
from state funds and $70,000 from industry memberships. In fiscal year 
1996, non-federal funds included $26,000 in state funds and $80,000 in 
industry funds. In fiscal year 1997, non-federal funds included $35,000 
in state funds and $95,000 in industry memberships. In 1998, $35,000 in 
state funds and $105,000 in private industry memberships contributed to 
the support of the project.
    Question. Where is this work being carried out?
    Answer. Research is being conducted in the laboratories of the Ohio 
State University and at various participating companies in Ohio, 
Illinois, and Pennsylvania.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigator anticipates that some projects 
supported by the fiscal year 1996 grant will be completed by February 
28, 1998. At the current funding level, it is anticipated that funding 
will be required through fiscal year 2000 to achieve the goal of self-
sufficiency.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
The last review of the proposal was conducted on January 28, 1998. At 
that time, the agency science specialist believed that the projects 
addressed issues relevant to food manufacturing, were scientifically 
sound, and that satisfactory progress was being demonstrated using 
previously awarded grant funds.
                   center for rural studies, vermont
    Question. Please provide a description of the program that has been 
funded under the Center for Rural Studies Project in Vermont.
    Answer. The Center for Rural Studies Project involves applied 
research focused on developing and refining social and economic 
indicators used to evaluate the impact of economic development 
programming and activities. They are perfecting a delivery format for 
technical assistance for community and small business development. A 
major component of current research relates to utilization of the world 
wide web as a delivery vehicle. Project proposal undergoes a merit 
review within the agency.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. This is an on-going pilot to demonstrate the effective 
development and implementation of applied research, training, 
education, and technical assistance related to rural development. The 
grant has addressed methodology and strategies for assessing rural 
development program impacts.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to create a database and analytical 
capability for rural development programming in Vermont. Examples of 
past accomplishments include maps presented to target child hunger 
programs, targeted areas for other types of rural development program 
intervention, analytical reports to guide the development of retail 
shopping areas, an ``Economic Handbook for Vermont Counties'', and 
strategies for using the world wide web to disseminate information.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The grant was initiated in fiscal year 1992. Appropriated 
amounts are: fiscal years 1992-93, $37,000 per year; fiscal year 1994, 
$35,000; fiscal years 1995-98, $32,000 per year; fiscal year 1999, 
$200,000 for total appropriations of $437,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Fiscal year 1991 included $91,130 in state matching funds. 
fiscal years 1993, $143,124; 1994-96, $3,547 state matching funds. 
fiscal years 1997-98 state dollars were $2,931 plus researcher's 
salary. 1999 dollars are not known at this time.
    Question. Where is this work being carried out?
    Answer. Applied research and outreach is being carried out through 
the University of Vermont.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original completion date was September 30, 1993. The 
original objectives of this research have been met. The additional 
objectives being presented for the current year will be completed by 
September 30, 2000. Proposal for current has not been received to date.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the merit of research proposals as 
they are submitted. No formal evaluation of this project has been 
conducted. The principal investigators and project managers submit 
annual reports to the agency to document impact of the project. Agency 
evaluation of the project includes peer review of accomplishments and 
proposal objectives and targeted outcomes.
                     chesapeake bay agroecology, md
    Question. Please provide a description of the research that has 
been funded under the Chesapeake Bay Agroecology, Maryland, special 
grant.
    Answer. The Chesapeake Bay Agroecology grant focuses on increasing 
our understanding of nutrient cycling, retention, and utilization by 
vital agricultural industries located within vulnerable Chesapeake Bay 
watershed ecosystems that have been impacted by outbreaks of the toxic 
microorganisms Pfiesteria. There is a specific focus on Maryland's 
Eastern Shore. This research focus has been identified as a priority by 
the State of Maryland's Blue Ribbon Pfiesteria Action Commission 
Report--1997--and by a Research, Education, and Economics--REE--
strategic plan emphasis--Greater Harmony Between Agriculture and the 
Environment--that calls for ``a better understanding of the linkages 
between agricultural production, water and soil quality, range and 
forest land health, and habitat protection.'' Requested funds in fiscal 
year 1999 will support interdisciplinary projects that bring together 
the expertise of numerous scientists located at institutions throughout 
the University System of Maryland. These scientists continue to 
generate technical and scientific advances that guide Federal, state, 
and local policy responses to Pfiesteria outbreaks.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The continued viability of Maryland's important coastal 
agricultural economy, and the protection of Chesapeake Bay and Atlantic 
Coastal aquatic and agricultural resources from future Pfiesteria 
outbreaks, depends upon our ability to prevent future toxic algal 
blooms by stemming the flow of nitrogen, phosphorus, and other 
agricultural nutrients into estuarine waterways.
    Maryland is an acknowledged leader in implementing agricultural 
nutrient management, soil conservation, conservation reserve, 
Chesapeake Bay tributary team, and other cooperative planning 
strategies. However, non-point sources of nutrients remain a major 
source of pollution into Atlantic Coastal waterways, and farmland 
remains the largest controllable source of non-point nutrient loading 
into Chesapeake Bay. Thus, its essential that we continue to increase 
our efforts to stem nutrient losses into waterways while preserving and 
enhancing important agricultural industries.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is to increase our understanding 
of nutrient--nitrogen and phosphorus--cycling, retention, and 
utilization by vital agricultural industries located in coastal regions 
of Chesapeake Bay, and to develop new technologies and strategies that 
limit nutrient losses while enhancing vital agricultural industries. 
This project was initiated in fiscal year 1999.
    Question. How long has this work been underway and how much as been 
appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $150,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The project is in its first year. The state of Maryland has 
pledged to match 100 percent of the Federal funds provided in fiscal 
year 1999 and in future years for the Chesapeake Bay Agroecology 
Project.
    Question. Where is the work being carried out?
    Answer. This research will be conducted at University System of 
Maryland institutions and field research stations located throughout 
the state, with an emphasis on the Eastern Shore of Maryland which 
experienced significant Pfiesteria outbreaks.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This project begins in fiscal year 1999. There will be a 
need for additional Federal, state, and private investment in research 
to develop new approaches for agricultural nutrient control in 
estuarine systems for the foreseeable future.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project begins in fiscal year 1999. The projects 
supported by this special grant will be peer reviewed by an 
independent, external scientific panel and will be competitively 
awarded to qualified scientists located throughout the University 
System of Maryland.
                  chesapeake bay aquaculture, maryland
    Question. Please provide a description of the research funded under 
the Chesapeake Bay Aquaculture grant.
    Answer. The objective of this research is to improve the culture of 
striped bass and its hybrids through genetic improvement, reproductive 
biology, nutrition, health management, waste management, and product 
quality. The research provides a good balance between basic and applied 
research. The university awards grants based on an internal competitive 
peer review, and the CSREES Program Manager reviews the proposal each 
year.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the Mid-Atlantic region 
of the country has significant opportunities to contribute to the 
overall development of the domestic aquaculture industry. Research 
supported through this program should have broad application and 
enhance production efficiency and the sustainability of aquaculture as 
a form of production agriculture.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original research goal was to generate new knowledge 
that can be utilized by the aquaculture industry to address serious 
problems limiting the expansion of the industry in Maryland and the 
Mid-Atlantic region. The program focuses on closing the life cycle of 
the striped bass and its hybrids, enhancing production efficiency, 
decreasing effluents, and improving product quality under aquaculture 
conditions. Research is conducted in the areas of growth, reproduction 
and development, aquacultural systems, product quality, and aquatic 
animal health. Progress has been made in developing controlled 
artificial spawning techniques and refining the nutritional 
requirements of striped bass. Scientists continue studies to optimize 
water quality in closed systems. Water calcium levels above 250 ppm 
were shown to increase survival in striped bass. Researchers indicate 
that increased environmental calcium may improve survival and that 
intermediate salinity levels may improve the feed conversion efficiency 
in juvenile striped bass. Researchers have developed improved 
techniques for storing striped bass sperm. Growth hormone 
administration was shown to increase body length in striped bass. The 
aquatic animal health component of the research is aimed at the 
prediction and management of dinoflagellate blooms in estuarine hybrid 
striped bass ponds
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported under this grant began in fiscal year 
1990 and the appropriation for fiscal year 1990 was $370,000. The 
appropriation for fiscal years 1991-1993 was $437,000 per year; fiscal 
year 1994, $411,000; fiscal years 1995-1998, $370,000 each year; and 
fiscal year 1999, $385,000. A total of $3,957,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university reports the amount of non-federal funding 
for this program is as follows: in fiscal years 1991 and 1992, 
$200,000; in fiscal years 1993 and 1994, $175,000; in fiscal year 1995, 
$400,000; in fiscal year 1996 $536,000; in fiscal year 1997 
approximately $400,000; in fiscal year 1998, $360,000. The university 
reports that these funds are from direct state appropriations and other 
non-federal funding sources.
    Question. Where is the work being carried out?
    Answer. Research is being conducted at the University of Maryland.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original specific research objectives were to completed 
in 1993. These specific research objectives have been met, however, the 
broader research objectives of the program are still being addressed. 
The specific research outlined in the current proposal will be 
completed in fiscal year 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to submit an accomplishment 
report when the new proposal is submitted to CSREES for funding. The 
1998 review indicated the proposal was well written with objectives 
clearly stated; that excellent progress is reported on previous work; 
that scientific and technical expertise is excellent; and that the 
proposal addresses high priority research needs. The 1999 CSREES review 
will be completed within three weeks of submission of the proposal. The 
researchers are asked to the develop a research proposal consistent 
with the National Science and Technology Council's Strategic Plans for 
Aquaculture Research and Development. The proposal does address high 
priority research needs for the aquaculture industry at the state, 
regional, and national level.
                            citrus tristeza
    Question. Please provide a description of the research that has 
been funded under the citrus tristeza research program grant.
    Answer. CSREES has developed a RCA with input from industry and 
researchers for a competitive grant program for this program.
    Question. According to this research proposal, or the principal 
investigator, what is the national, regional, or local need for this 
research?
    Answer. Citrus Tristeza virus is a problem in all citrus growing 
areas of the United States. The recent introduction of a new vector, 
the brown citrus aphid, into Florida has allowed for another pathotype 
of the virus to be introduced. This is a more destructive pathotype of 
the virus that is more devasting that than those already in the citrus 
producing areas.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is to reduce losses in citrus 
through research, characterization, and detection of citrus tristeza 
virus strains, biology, and control of the brown citrus aphid; host 
plant resistance; epidemiology and crop loss assessment; development of 
cross-protecting citrus tristeza virus strains; and research to enhance 
virus free budwood programs.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $500,000.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. There are no non-federal funds provided for this grant.
    Question. Where is this work being carried out?
    Answer. Research is being carried out at land grant universities 
and research centers in the United States, primarily Florida, Texas, 
California, and Arizona.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Since this is a new program, the original objectives have 
not yet been met.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project will under peer review at the University level 
and agency merit review.
          competitiveness of agriculture products, washington
    Question. Please provide a description of the research that has 
been done under the Competitiveness of Agriculture Products research 
grant?
    Answer. This research improves opportunities for Northwest firms to 
export forest products and food products.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local need for this 
research?
    Answer. Shipping forest products from the Pacific Northwest to 
Asian markets costs less than shipping them to the eastern population 
centers in the United States. Research has focused on opening Asian 
markets including the more complete transfer of U.S. light frame 
construction building technology primarily to Japan in direct support 
of the efforts to deregulate the Japanese housing sector, thereby 
providing large opportunities to export higher valued secondary 
manufactured products to Japan. The Asian economic crisis has 
temporarily lowered demand requiring market research on how to protect 
the export gains that have been made. Research has also been focused on 
forest management alternatives that can better satisfy environmental 
goals with less negative impacts on timber-dependent communities. 
Priorities are set by an outside Executive Board, and they review 
progress quarterly. Faculty review the technical merits of each project 
proposal.
    Export of foods--specifically produced to meet Asian tastes--
improves the global competitiveness of the Pacific Northwest. Research 
focuses on foreign market assessments, product development, and policy 
and trade barriers. The focus is on technology that can add value to 
U.S. agricultural products while meeting changes brought by 
international trade agreements. This grant is awarded competitively at 
the state level.
    There is a very large opportunity to increase the export of 
materials and building systems to Asian markets. Northwest companies 
that could export are generally small and are not able to provide their 
own research. Construction technologies used in Asian markets are 
inferior to U.S. technology, yet there is a long history of use and 
cultural appreciation of traditional methods. Deregulation and change 
in these markets has required extensive research on comparability of 
alternative product and building standards, quality and service needs, 
training in the U.S. technology, and customization to foreign consumer 
values. The Pacific Northwest can grow more wood with higher quality 
using more advanced technologies while reducing the impact on timber-
dependent communities from harvest constraints to protect certain 
species. The Northwest agricultural economy is highly dependent upon 
being able to export given that food production in the region greatly 
exceeds food consumption.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the research in both wood products and food is 
to provide the information on markets and product technologies that can 
open higher-valued international markets to U.S. exporters. Foreign 
purchasers need information on the advantages of U.S. products and U.S. 
exporters need information on the substantially different quality and 
service requirements for serving foreign markets. Value added wood 
product exports had increased over 200 percent prior to the Asian 
crisis, but still remain 100 percent above earlier levels. If the 
United States can remain competitive and retain its presence in these 
markets in the face of a stronger dollar, exports should return to a 
high growth path once their economies begin to recover.
    The food production research has focused on finding new market 
opportunities for Pacific Northwest producers, solving technical 
impediments to exports and developing new products and new processes 
that will enhance exports. It has pinpointed emerging market 
opportunities in Southeast Asia, China, Mexico, and Latin America. It 
has improved the export quality of diverse products such as asparagus, 
apples, grass-seed, and wheat, and it has helped commercialize high-
value products such as Wagyu beef, azuki beans, wasabi radish, and 
burdock and pioneered new food processing technologies that produce 
fresh-like, shelf-stable products and save energy and reduce waste.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. The work began in fiscal year 1992. The appropriation for 
fiscal years 1992-1993 was $800,000 each year; fiscal year 1994, 
$752,000; fiscal years 1995-1998, $677,000 each year; and $680,000 in 
fiscal year 1999. A total of $5,740,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $716,986 State appropriations, $209,622 product sales, 
$114,000 industry, and $661,119 miscellaneous, for a total of 
$1,701,727 in 1991; $727,345 State appropriations, $114,581 product 
sales, $299,000 industry, and $347,425 miscellaneous for a total of 
$1,488,351 in 1992; $1,259,437 State appropriations, $55,089 product 
sales, $131,000 industry, and $3,000 miscellaneous, for a total of 
$1,448,526 in 1993; $801,000 State appropriations, $1,055,000 product 
sales, $1,040,000 industry, and $244,000 miscellaneous, for a total of 
$3,140,000 in 1994; $810,000 State appropriations, $42,970 product 
sales, $785,000 industry, and $2,000,000 gift of a ranch due to the 
International Marketing Program for Agricultural commodities and Trade 
Center's research on Wagyu cattle, for a total of $3,637,970 in 1995; 
$844,000 State appropriations, $45,000 product sales $900,000 industry, 
and $45,000 miscellaneous, for a total of $1,834,000 in 1996; $876,000 
State appropriations, $1,606,000 industry, for a total of $2,482,000 in 
1997, and $1,180,000 State appropriations, $604,000 industry, for a 
total of $1,784,000 in 1998.
    Question. Where is the work being carried out?
    Answer. The food research is being carried out by the International 
Marketing Program for Agricultural Commodities and Trade at Washington 
State University, Pullman, and the forest products research is carried 
out at the Center for International Trade in Forest Products at the 
University of Washington, Seattle.
    Question. What was the anticipated completion date of the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was projected for 3 years duration to be 
completed following fiscal year 2000.
    Question. When was the last agency evaluation of this project? 
Provide the summary of the last evaluation conducted.
    Answer. Two evaluations of the Washington State University 
component of the project were conducted in 1992 by the U.S. Department 
of Agriculture. The State of Washington Legislative Budget Committee 
gave the Washington State Center exemplary marks for meeting its 
objectives. On-site reviews are conducted annually of the University of 
Washington component of the project through annual meetings of the 
project's executive board attended by the agency's staff. Both 
components are reviewed annually by the agency. The project is meeting 
the key objective of trade expansion through innovative research. The 
University of Washington project was formally reviewed by the agency in 
1991. State reviews were completed in 1992 and 1994. A formal review by 
the University was completed in 1997. A broad survey of constituents 
impacted by the research was completed, resulting in a very favorable 
review of the Center's activities and a recommendation to continue this 
research. In 1998, State of Washington legislation eliminated the 
requirement for state reviews of the center, including one scheduled 
for 1999, based on hearings that focused on the other favorable reviews 
and the continuous oversight by the Executive Board.
                  contagious equine metritis, kentucky
    Question. Please provide a description of the research that has 
been conducted under the Contagious Equine Metritis, Kentucky grant.
    Answer. The research being conducted is focusing on a new variant 
of the original equine metritis agent, and CSREES has requested the 
university to submit a grant proposal that has not yet been received.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for the 
research?
    Answer. The need for this research is national in scope. Several 
years ago, contagious equine metritis caused serious problems and 
caused embargoes on importation of horses from other countries. The 
original organism is currently being controlled, but a new variant has 
caused concern that it may not respond to current control measures.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal is planned to be a study of the economic 
impact that this may have on the equine industry, including both racing 
and performance horses. Also, work will be done to ensure that adequate 
control measures are in place to prevent widespread infection with this 
new variant.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work will be initiated in fiscal year 1999 and the 
appropriation for fiscal year 1999 is $250,000.
    Question. What is the source and amount of non-federal funds by 
fiscal year?
    Answer. No information is presently available as to the probable 
amounts or sources of non-federal fund in fiscal year 1999 for this 
project.
    Question. Where is this work being performed?
    Answer. The research is being performed at the Department of 
Veterinary Science, University of Kentucky.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original project 
will be about one year after initiation of the project or May, 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. As the project is just being started, no agency evaluation 
has been done at this time.
                      cool season legume research
    Question. Please provide a description of the research that has 
been funded under the Cool Season Legume Research grant.
    Answer. The Cool Season Legume Research Program involves projects 
to improve efficiency and sustainability of pea, lentil, chickpea, and 
fava bean cropping systems collaborative research. Scientist from seven 
states where these crops are grown have developed cooperative research 
projects directed toward crop improvement, crop protection, crop 
management, and human nutrition/product development. CSREES has 
requested the universities to sub grant proposals for 1999 funding.
    Question. According to the research proposal, or principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The multi-state region covered by this program represents 
most of the nation's production of cool season food legumes. These 
minor crops are very important economically to the region, are the 
primary source of these important food items, and contribute 
significantly to U.S. agricultural exports. The growers face a number 
of production problems that need research if this industry is to 
compete with international competition. In addition, use of these crops 
in rotation with wheat is critical to the production of wheat, the 
major cash crop for the region. National research in the area of crop 
genetics could potentially be supported by competitive grants awarded 
under the National Research Initiative and the Initiative for Food and 
Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The principal researcher believes the original goal of this 
project was to improve efficiency and sustainability of cool season 
food legumes through an integrated collaborative research program and 
genetic resistance to important virus diseases in peas and lentils. 
Evaluation studies of biocontrol agents for root disease organisms on 
peas are underway. Other studies are evaluating integration of genetic 
resistance and chemical control. Considerable progress has been made 
using biotechnology to facilitate gene identification and transfer. 
Management system studies have addressed tillage and weed control 
issues.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
with appropriations for fiscal year 1991 of $375,000; fiscal year 1992 
and 1993 $387,000 per year; fiscal year 1994, $364,000; fiscal year 
1995, $103,000; fiscal years 1996 and 1999, $329,000 per year. A total 
of $2,932,000 has been appropriated.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The non-federal funds provided for this grant were as 
follows: 1991. $304,761 state appropriations, $14,000 industry, and 
$18,071 other nonfederal; 1992, $364,851 state appropriations, $15,000 
industry, and $14,000 other non-federal; 1993, $400,191 state 
appropriations, $19,725 industry, and $10,063, other non-federal; and 
1994, $147,607 non-federal support. Non-federal support for 1995 was 
$150,607; for 1996 it was $386,887; for 1997 $384,628; and for 1998, 
$392,000.
    Question. Where is this work being carried out?
    Answer. Research has been conducted at agricultural experiment 
stations in Idaho, Oregon, Washington, Wisconsin, Minnesota, New York, 
and New Hampshire. The funds have been awarded competitively among 
participating states and not all states receive funds each year.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The projected duration of the initial project was five 
years. Revised objectives are expected to be completed in 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation?
    Answer. The project is evaluated annually by a university/industry 
advisory panel. Proposals are peer reviewed at the universities and by 
CSREES National Program Leaders. This research has provided vital 
information which is already being used to improve production 
management. However, a number of critical issues related to insect and 
disease control as well as crop quality remain to be addressed. 
Breeding for insect and disease resistance is given the highest 
priority, while crop management alternatives to help reduce disease and 
insect pest problems will continue to be studied.
                         cotton research, texas
    Question. Please provide a description of the research that has 
been funded under the Cotton Research, Texas, grant.
    Answer. CSREES has requested the university to submit a grant 
proposal for fiscal year 1999, that has not yet been received. Texas 
A&M and Texas Tech Universities have developed an integrated research 
effort to address cotton production issues using a comprehensive 
approach in order to strengthen the cotton industry in the high plains. 
Priority productions and marketing issues will be studied.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The proposed project is expected to help support a broad 
based program to address priority research needs of cotton grown on the 
Texas high plain. The specific issues will include production, 
processing, marketing, and utilization.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this project is to improve cotton production in 
West Texas and expand the demand for cotton grown in the area.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998. 
The appropriation for fiscal years 1998-1999 was $200,000. A total of 
$400,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds supporting the project were $156,000 
in fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. The work will be conducted at the Texas A&M University 
Research and Extension Center, Lubbock and Texas Technical University 
Campus.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigators anticipate the developmental 
phase of this project which will establish priorities and provide 
planning for a long-term comprehensive program should be completed in 
fiscal year 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project received a comprehensive review and evaluation 
at its inseption by Texas A&M and Texas Tech Universities and the 
CSREES National Program Leader. It will be evaluated annually 
throughout its lifetime.
          cranberry-blueberry disease and breeding, new jersey
    Question. Please provide a description of the research that has 
been funded under the Cranberry-Blueberry Disease and Breeding, New 
Jersey grant.
    Answer. The work has focused on identification and monitoring of 
insect pests on blueberries and cranberries; the identification, 
breeding, and incorporation of superior germplasm into horticulturally-
desirable genotypes; identification and determination of several fungal 
fruit-rotting species; and identification of root-rot resistant 
cranberry genotypes. Overall, research has focused on the attainment of 
cultural management methods that are environmentally compatible, while 
reducing blueberry and cranberry crop losses. This project was not 
awarded competitively but has undergone peer review at the university 
level and merit review at CSREES.
    Question. According to the research proposal, or the principal 
investigator, what is the national, regional, or local need for this 
research?
    Answer. This project involves diseases having major impacts on New 
Jersey's cranberry and blueberry industries, but the findings here are 
being shared with experts in Wisconsin, Michigan, and New England.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was the development of cranberry and 
blueberry cultivars compatible with new disease and production 
management strategies. Over 75 blueberry selections with wild blueberry 
accessions resistant to secondary mummy berry infections have been 
moved into advanced testing identified. The biology and seasonal life 
history of spotted fireworm on cranberries has been determined. A 
pheromone trap-based monitoring system for cranberry fruitworm was 
developed and further refined for commercialization in 1997. Blueberry 
fruit volatiles attractive to blueberry maggots were identified and 
tested in the field. Seven major fungal fruit-rotting species were 
identified, and their incidence in 10 major cultivars of blueberry and 
cranberry were determined. It is likely that resistance to fruit rot is 
specific to fungal species. Researchers have planted over 4,500 
cranberry progeny for evaluation.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1985, $100,000; fiscal years 1986-1987, $95,000 
per year; fiscal years 1988-1989, $260,000 per year; fiscal year 1990, 
$275,000; fiscal years 1991-1993, $260,000 per year; fiscal year 1994, 
$244,000; and fiscal years 1995-1999, $220,000 each year. A total of 
$3,209,000 has been appropriated
    Question. What is the source and amount of non-federal funds 
provided by fiscal?
    Answer. State and non-federal sources are providing funds in the 
amount of 250,000 each year.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at the New Jersey 
Agricultural Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The completion date for the original objectives was 1995. 
Those objectives have not been met. To complete the breeding, disease, 
and insect management and provision of new management guidelines for 
extension and crop consultants, it estimated that an additional five to 
nine years will be required.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted?
    Answer. The last agency evaluation of this project occurred in 
January, 1998. In summary, the evaluation stated that the effort has 
continued to be highly productive, with various improved management 
strategies, plant materials, and environmentally-balanced pesticides 
being areas of major impact. Some specific accomplishments included 
continued evaluation of blueberry and cranberry germplasm for yield, 
color, fruit rot, and flavor; and development of an efficient plant 
regeneration system for cranberry for genetic transformation. Other 
research includes trap and lure development for monitoring the 
cranberry fruitworm and evaluation of several aphicides in blueberries. 
The discovery of an antisporulant in a registered fungicide provide for 
a novel use patent for blueberry anthracnose control.
                 cranberry and blueberry, massachusetts
    Question. Please provide a description of the research that has 
been funded under the cranberry/blueberry research program grant.
    Answer. This is a new research project that will aid in the 
reduction of pesticide dependence in cranberry and blueberry production 
in Massachusetts. The main target pests are dodder, weeds, and fungi. 
This research will provide an integrated pest management approach to 
cranberry and blueberry production. This project was not awarded 
competitively but has undergone peer review at the university level and 
merit review at CSREES.
    Question. According to this research proposal, or the principal 
investigator, what is the national, regional, or local need for this 
research?
    Answer. The research is a new approach to managing pests associated 
with cranberries and blueberries in Massachusetts. The program will 
focus on the use of molecular genetics to reduce pesticide dependency 
in cranberry production. The research will be applicable to all 
cranberry research in states where cranberries are produced. Ongoing 
regional research in this area is supported by grants awarded under the 
Minor Crop Pest Management Program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals of this research are to determine whether early 
emerging and late emerging dodder populations can be differentiated 
using molecular markers; to determine the relationships among several 
isolates of a fungus which might be used in biological control; to 
screen various plant pathogen fungi isolates for infectivity and 
virulence and determine the presence of genes in these isolates; and 
develop an in vitro assay system for root rot and induce resistance in 
cranberry plants caused by different isotypes of the fungus.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $150,000.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. There are no non-federal funds provided for this grant in 
1999.
    Question. Where is this work being carried out?
    Answer. Research is being carried out at the University of 
Massachusetts Cranberry Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Since this is a new program, the original objectives have 
not yet been met.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project will under peer review at the University level 
and agency merit review.
                            critical issues
    Question. Please provide a description of the research that has 
been funded under the Critical Issues grant.
    Answer. These funds support research on critical issues related to 
new or emerging pests and diseases of animals and plants. The program 
is expected to initiate research in a short time period until other 
resources can be secured to address the issue. The program began in 
fiscal year 1996 when potato late blight and vesicular stomatitis in 
animals were the two targeted emerging problems chosen for funding. 
Funding for vesicular stomatitis research was continued through fiscal 
year 1997 in an effort to identify either insect carriers of the virus 
that could transmit the disease among animals or the wildlife 
reservoirs of the virus which could contribute to initiation of future 
outbreaks. In fiscal year 1997, the critical issues funding continued 
to support research on potato late blight so that growers will be able 
to manage disease outbreaks more effectively with integrated pest 
management programs. During fiscal year 1998, these funds were used for 
support of a project on a newly emerging corona virus strain that is 
considered to be a probable cause of severe outbreaks of shipping fever 
or pneumonia in shipped beef cattle. For plant diseases, fiscal year 
1998 funds were used to support two major research projects on a new 
disease of sorghum, Sorghum Ergot. The two projects were Epidemiology 
and Life History of Ergot and Development of Integrated Control of 
Sorghum Ergot.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Vesicular stomatitis was of national impact due to its 
similarity to foot and mouth disease and the negative effect on 
movement of horses, cattle, and swine during an outbreak. Since 1992 
new, highly virulent strains of the potato late blight fungus 
Phytophthora infestans caused severe losses in potato and tomato 
production throughout the United States, resulting in what some experts 
term a national crisis. From 1993 to 1995, a series of meetings 
involving growers, consultants, industry, academia, and government 
assessed the growing problem, and participants concluded that 
extraordinary steps were needed to mobilize research efforts that would 
help address the problem in the near term. Bovine shipping fever causes 
heavy economic losses to the beef industry in cattle being shipped to 
feedlots and vaccines for currently recognized viruses seem to be 
ineffective in certain settings in preventing outbreaks. The isolation 
of a probable new virus, bovine respiratory corona virus, represents an 
opportunity to contribute to the reduction of this disease complex in 
cattle. Sorghum Ergot is a serious disease of sorghum which was first 
detected in Texas in March, 1997. It rapidly spread to almost all 
sorghum growing regions of the U.S. by September 1997. Decisions on 
specific research needs and focus of research projects is decided after 
consultation with a variety of commodity stakeholders, other USDA 
agencies, especially the Animal and Plant Health Inspection Service, 
scientists in land grant system, and other public input.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. In animals, the goal was to discover natural reservoirs of 
the vesicular stomatitis virus and insects which are capable of 
transmitting the disease among animals. At this time, we have been 
unable to find significant wild life hosts which could serve as a 
reservoir for the virus during periods between outbreaks nor have the 
researchers been able to isolate the virus from insects in areas 
affected during the most recent outbreak. The bovine respiratory 
disease work on the apparently new respiratory corona virus is expected 
to validate the role of this virus in outbreaks of pneumonia in cattle 
vaccinated for other known causes of shipping fever. Confirmation of 
such a fact will provide a basis for development of control measures 
including vaccine development. Research was initiated to provide 
growers with the knowledge and technologies they need to reduce 
economic losses resulting from potato late blight with less reliance on 
pesticides. Research initiated with fiscal year 1996 funds is making 
progress in developing modeling tools and management approaches that 
are an important step towards reducing the devastating effects of late 
blight. The National Late Blight Fungicide Trial provided important 
information on the efficacy of an array of fungicide programs. A World 
Wide Web site was established to provide growers, researchers and 
industry with the latest information on management of potato late 
blight. The research projects on Sorghum Ergot were intended to develop 
information about the history and epidemiology of the disease which 
would lead to studies on development of integrated control programs for 
this fungus.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. $200,000 per year were appropriated in fiscal years 1996-
1999 for a total appropriation of $800,000 to date.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. This information is not currently available.
    Question. Where is this work being carried out?
    Answer. The vesicular stomatitis work was conducted at the 
University of Arizona and Colorado State University. The potato late 
blight work has been conducted at Washington State University, Oregon 
State University, University of Idaho, University of Wisconsin, 
Pennsylvania State University, and North Carolina State University. The 
bovine respiratory disease work is being performed at Louisiana State 
University. The Sorghum Ergot work is being done at the University of 
Nebraska and Texas A&M University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Critical Issues funds are intended to support the 
initiation of research on issues requiring immediate attention until 
other, longer-term resources are available. The objectives of the 
projects are short-term and are expected to be completed within a 1-2 
year period. This has been true for the vesicular stomatitis and potato 
late blight work. These projects have been reviewed to ensure 
compliance with the original goals during fiscal year 1997. The 
subsequent project grants for potato blight in 1997 and for Sorghum 
Ergot and bovine respiratory disease in 1998 have short term goals and 
are expected to be completed by the end of their project years which 
will occur in late spring 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. All projects were reviewed for scientific merit before 
funding decisions were made. Also, scientists being supported with 
these funds are in close contact with CSREES' National Program Leaders 
in these areas so that the agency is kept abreast of developments as 
they occur. In addition, site visits are arranged when convenient to 
include as part of other official travel to that state. The vesicular 
stomatitis research has received one site visit review in early 1998 
and will be reviewed as a completed project in March, 1999. It is 
expected that the final results of the bovine respiratory work will be 
reviewed during early July, 1999. The plant related projects have 
received similar reviews as the projects have moved forward, and the 
results are being reported at regional and national meetings.
         dairy and meat goat research, prairie view a&m, texas
    Question. Please provide a description of the research that has 
been funded under the dairy goat research grant?
    Answer. The program has addressed a range of issues associated with 
goat production. Research by scientists at the International Dairy Goat 
Center, Prairie View A&M University, focuses on problems affecting goat 
production in the United States. Issues included are the study of 
nutritional requirements of goats, disease problems, methods to improve 
reproductive efficiency in the doe, the use of gene transfer to improve 
caprine genetics, and the evaluation of breeding schemes to improve 
meat and milk production. Currently, research is in progress to assess 
the economics of alternative breeding and rearing systems for goats in 
the southeastern region of the U.S., to study the incidence and impact 
of intestinal parasites, and to develop least-cost health management 
strategies for parasite control.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that nationally, most of 
the farm enterprises that include goats are diverse and maintain a 
relatively small number of animals. Responding to disease, nutrition, 
breeding, and management problems will improve efficiency of production 
and economic returns to the enterprise.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to conduct research 
that will lead to improvement in goat production among the many small 
producers in the United States. Research has been conducted to develop 
and improve nutritional standards, improve genetic lines for meat and 
milk production, and to define mechanisms that impede reproductive 
efficiency in goats. Current efforts focus on the development of 
enterprise budget management tools for goat producers in the Texas gulf 
coast region.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded through appropriated funds as 
follows: $100,000 per year for fiscal years 1983-1985; $95,000 per year 
for fiscal years 1986-1988; no funds were appropriated in fiscal year 
1989; $74,000 for fiscal year 1990; $75,000 per year for fiscal years 
1991-1993; $70,000 for fiscal year 1994; and $63,000 per year for 
fiscal years 1995-1999. A total of $1,269,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The University reports no non-federal funds expended on 
this program.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Prairie View A&M University 
in Texas.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The overall objective of this research is to support the 
needs of small farms engaged in the production of meat and milk from 
goats along the Texas Gulf Coast. The university researchers continue 
to address those needs on an annual basis and anticipate that work 
currently in progress will be completed by the end of fiscal year 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Dairy/Meat Goat Research grant was reviewed last in 
June, 1997. The project objectives are within the goals of the program, 
are within the mission of both USDA and CSREES, and the institution is 
well equipped and qualified to carry out the research project.
                delta rural revitalization, mississippi
    Question. Please provide a description of the program that has been 
funded under the Delta Rural Revitalization, Mississippi Project?
    Answer. The Delta Rural Revitalization, Mississippi Project 
involves applied research and outreach focused on creating new and 
expanded economic development opportunities for the Mississippi Delta 
region. The project has gone through several phases in the delineation 
of a strategy for long range development within the region. Phase I was 
completed with the delivery of a baseline assessment of the economic, 
social, and political factors that enhance or impede the advancement of 
the region. Phase II of the project evaluated the potential for 
entrepreneurship and small business creation as mechanisms to improve 
economic conditions. Phase III is now focusing on technical assistance 
to Delta region manufacturing firms to strengthen their ability to 
provide employment and incomes and includes to development and 
refinement of data bases and development statistics. The proposals are 
submitted for internal review and evaluation within the agency. 
Recommendations are presented to enhance impact on regional and 
national agendas and provide greater impact on targeted region.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. This is an on-going pilot to demonstrate the effective 
development and implementation of applied research, training, 
education, and technical assistance related to job and business 
development as a development strategy. The principal researcher 
believes that the databases, technical assistance, and analytical 
capability will increase the effectiveness of economic development and 
entrepreneurial activity in the region.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The applied research and outreach project was designed to 
increase ability to strategically guide economic development through 
target industry attraction. They developed an analytical baseline for 
the Delta region to benchmark economic development progress and to 
profile potential arenas of opportunity. An entrepreneurial forum was 
established to help new business ventures with start-up advice and 
assistance. A venture capital association was formed to help both 
inventors and businessmen find capital resources to carry out 
development initiatives. The emphasis of the project is now shifted to 
technical assistance for existing industries.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from appropriated funds in the 
following amounts per year: fiscal year 1989, $175,000; fiscal year 
1990, $173,000; fiscal years 1991-93, $175,000 per year; fiscal year 
1994, $164,000; fiscal years 1995-99, $148,000 per year. A total of 
$1,777,000 has been appropriated and awarded.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Total non-federal funds directed to this project, as 
reported by Mississippi State University, are: fiscal year 1991, 
$117,866; fiscal year 1992, $84,402; fiscal year 1993, $68,961; fiscal 
year 1998, $57,404. Reports for other years are incomplete at this 
time.
    Question. Where is this work being carried out?
    Answer. Applied research and outreach is being carried out through 
Mississippi State University and sub-contractors.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original completion date was September 30, 1990. The 
original objectives of this research have been met. The additional 
objectives being presented for the current year should be completed by 
September 30, 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the merit of research proposals as 
they are submitted. No formal evaluation of this project has been 
conducted. The principal investigators and project managers submit 
periodic reports to the agency to document impact of the project. 
Significant suggestions have been offered to improve the relevance and 
impact of this project. Time lines tend to lag on targeted 
accomplishments. An assessment of the project was conducted by the 
Social Science Research Center at Mississippi State University and a 
report compiled in November, 1996.
                   designing foods for health, texas
    Question. Please provide a description of the research that has 
been funded under the Designing Foods for Health, Texas grant.
    Answer. Designing fruits and vegetables for improved health and 
nutrition will be the over all goal. Health scientists have documented 
that naturally-occurring compounds such as flavonoids, carotenoids, and 
antioxidants, have health benefits to prevent heart disease, stroke, 
and some forms of cancer. The goal of Texas A&M researchers is to 
develop fruits and vegetables that have uniform, high levels of these 
compounds so all consumers can prevent disease through their diet. 
CSREES has requested the university to submit a grant proposal that has 
not yet been received.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The need for this research is to improve the quality of 
fruits and vegetables. Fruits and vegetables have naturally-occurring 
compounds that promote health and prevent disease. Health scientists 
have documented these compounds and have evidence that they do prevent 
certain diseases. The medical community is stating that preventing 
disease is more advantageous than trying to cure it.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research will be to design fruits 
and vegetables that assist in preventing diseases through diet.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $250,000.
    Question. What are the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are estimated to be as follows: $146,449 state appropriations and 
$200,000 miscellaneous in fiscal year 1999.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at the Vegetable and Fruit 
Improvement Center and other locations within the Texas A&M University 
System.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is projected to be 2003. This research is a long-term project and must 
be continued as health scientists continue to document the compounds in 
foods that promote disease prevention.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Texas A&M researchers will conduct a peer review prior to 
submitting the proposal for fiscal year 1999.
                      drought mitigation, nebraska
    Question. Please provide a description of the research that has 
been funded under the Drought Mitigation grant.
    Answer. The National Drought Mitigation Center in the School of 
Natural Resource Sciences at the University of Nebraska has a 
comprehensive program aimed at lessening societal vulnerability to 
drought by promoting and conducting research on drought mitigation and 
preparedness technologies, improving coordination of drought-related 
activities and actions within and between levels of government, and 
assisting in the development, dissemination, and implementation of 
appropriate mitigation and preparedness technologies in the public and 
private sectors. Emphasis is directed toward research and outreach 
projects and mitigation/management strategies and programs that stress 
risk minimization measures rather than reactive actions.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The Federal Emergency Management Agency has recently 
estimated that annual losses attributable to drought in the United 
States are between $6,000,000,000-8,000,000,000. Drought impacts are 
escalating in response to increasing demands for water and other 
natural resources, increasing and shifting population, new 
technologies, and social behavior. These impacts are diverse and affect 
the economic, environmental, and social sectors of society. This fact 
was reinforced dramatically in 1996 in the Southwestern United States. 
Impacts in Texas alone were estimated to be more than $5,000,000,000.
    The Center is receiving non-federal funds in support of this 
research from the University of Nebraska. In addition, the Center is 
attracting support for specific projects that are an integral part of 
its mission from federal and state sources.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to create a National 
Drought Mitigation Center and develop a comprehensive program aimed at 
lessening societal vulnerability to drought. The Center has created an 
information clearinghouse and is delivering information to a diverse 
audience of users through its home page. Over 50,000 users now access 
the Center's home page each month. The Center's award winning home page 
was used extensively by state and federal agencies during the 1996 
drought to assist in the evaluation and response process. This home 
page networks users of drought-related information in the United States 
and elsewhere with information that would otherwise be unavailable or 
inaccessible to users.
    The National Drought Mitigation Center played an important role in 
the response of federal and state government to the 1996 severe drought 
in the Southwest and southern Great Plains states. In addition to 
providing timely and relevant information on drought severity and 
alternative response, mitigation, and planning measures, the Center 
participated in the Multi-state Drought Task Force workshop organized 
at the request of President Clinton and helped formulate long-term 
recommendations to improve the way this Nation prepares for and 
responds to drought. The Center is also a member of the Western 
Governors' Association Drought Task Force. This Task Force made 
recommendations to reduce the risks associated with drought in the 
western United States.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant received an appropriation 
of $200,000 in fiscal years 1995 through 1999, for a total 
appropriation of $1,000,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The University of Nebraska contributed $75,737 of non-
federal funds in support of this research in fiscal year 1995, $58,977 
in fiscal year 1996, and $61,545 in fiscal year 1997. The University of 
Nebraska contributed $67,819 in fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. The research will be conducted at the University of 
Nebraska-Lincoln.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The research conducted under this project is being 
undertaken under a series of nine tasks. Significant progress on each 
of these tasks has been made, but these activities are ongoing. The 
information clearinghouse has been created, but new information and 
documents are continuously added to the home page in response to users' 
needs and requests. In addition, the drought watch section is updated 
monthly to assist users in evaluating current climate and water supply 
conditions. Research on new climatic indices to monitor drought and 
water supply conditions are being tested and mitigation technologies 
and existing state drought plans are continuously evaluated. New 
activities are also being initiated in response to the growing interest 
and awareness in drought mitigation in the United States and elsewhere. 
For example, the activities of the Western Drought Coordination Council 
provides the Center with a broadening range of activities on an annual 
basis.
    Question. When was the last evaluation of this project? Provide a 
summary of the last evaluation conducted.
    Answer. The project was peer-reviewed at the time the proposal was 
prepared in 1998. Each year when the new proposal is prepared, it is 
reviewed at the university and again at CSREES. The project is 
evaluated for progress toward completion of objectives, new activities 
proposed, and accomplishments.
                          ecosystems, alabama
    Question. Please provide a description of the research that has 
been funded under the Ecosystems, Alabama, grant.
    Answer. In 1998, CSREES approved a proposal from Auburn University 
to support projects at two Community Colleges in Alabama--Faulkner 
State Community College and Alabama Southern Community College. The 
Faulkner State Community College's project is intended to (1) fund the 
development of distance education classrooms for estuarine-and marine-
related education, and (2) to establish an aquaculture-related 
veterinary technician education program. The Alabama Southern Community 
College project will purchase and install laboratory equipment to 
further the educational capacity of the Center for Excellence in 
Forestry, Paper, and Chemical Technology.
    Question. According to the research proposal, or the principal 
researcher, what is the local, regional, or national need for this 
project?
    Answer. Faulkner State Community College asserts that their 
veterinary technician program will be the only such program in the 
country, providing the first two years of the degree program leading to 
an A.A. degree at Faulkner State, and the second two years leading to a 
bachelor's degree at Auburn University. The distance education capacity 
is intended to better integrate marine and estuary research into 
educational activities.
    The Center for Excellence in Forestry, Paper, and Chemical 
Technology at Alabama Southern Community College is believed to be a 
unique educational opportunity in the Southeastern United States due to 
the merging of four individual technology training programs. These 
programs are: (1) Industrial Maintenance, (2) Electronics and 
Instrumentation, (3) Paper Process, and (4) Chemical Process training.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals for these projects include the development of a 
veterinary technician training program and integration of marine and 
estuary research into classrooms at Faulkner State Community College; 
and to establish a state-of-the-art wood paper process and chemical 
process laboratory at Alabama Southern Community College.
    These projects were initiated during the late summer of 1998, and 
no progress has yet been reported.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. These projects were initiated September 1, 1998, and have 
received a total of $1,000,000 to date with $500,000 appropriated per 
year in fiscal years 1998 and 1999.
    Question. What is the source and amount of non-federal funds 
provided to support this project?
    Answer. No non-federal funds have been identified to support this 
project.
    Question. Where is this work to be carried out?
    Answer. The project will be conducted at the Faulkner State 
Community College Aquaculture Center in Alabama and at the Alabama 
Southern Community College Center for Forestry, Paper, and Chemical 
Technology.
    Question. What is the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Alabama Southern Community College project proposal 
indicates a two year budget for project completion. The Faulkner State 
Community College proposal was for one year only. The objectives have 
not yet been met but are well underway.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project began in fiscal year 1998 and has not had a 
formal, onsite review to date. It received a merit review at the time 
the project proposal was submitted.
                    environmental research, new york
    Question. Please provide a description of the research that has 
been funded under the environmental research grant.
    Answer. The environmental research in New York has several major 
goals. These are: (1) to better understand the impacts of nutrient 
flows, principally nitrogen, from agriculture on non-agricultural 
ecosystems, forests, wetlands, and water resources in mixed ecosystem 
landscapes; (2) to improve knowledge of agricultural contributions to 
greenhouse gas emissions and effects of projected climate change on 
crop production; and (3) to develop innovative approaches and 
technologies for improving the efficiency of agricultural production 
and/or reducing environmental impacts of agriculture. New thrusts for 
the coming year include: 1) to improve understanding of the impacts of 
land application of biosolids on the sustainability of New York 
agriculture and on water quality, and to develop management practices 
and guidelines for sustainable use of biosolids in New York 
agriculture; and 2) to evaluate spatial and temporal variability of 
crop yields within fields and to develop management practices that 
increase productivity, increase the efficiency of use of inputs, and 
reduce environmental impacts of agriculture.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Interactions between agriculture and the environment are 
many and complex and require multi-disciplinary efforts to both 
understand the interactions and to develop effective management 
strategies. Programs supported by the special grant are multi-
disciplinary in nature, involving technical scientists from a range of 
disciplines, together with social scientists and economists. 
Additionally, translation of knowledge from plot or field studies to 
larger scales, such as landscape to regional and global, is needed to 
provide information that is useful to policy makers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. One goal of the program is to identify impacts of nitrogen 
flows from agricultural lands on adjacent natural ecosystems, forests 
and wetlands, and water resources, and to devise management strategies 
to minimize these impacts.
    Nitrogen leaching from maize-based cropping systems has been shown 
to be higher when organic sources of nitrogen, manures, and plow-down 
alfalfa are used as nitrogen sources for crop growth compared to use of 
inorganic fertilizers. Attempts to use an interseeded cover crop to 
capture and recycle excess nitrogen left over after the cropping season 
were only marginally successful due to limited growth of the cover crop 
following maize harvest in New York's climate. A computer-based 
nitrogen decision support system to improve recommendations for on-farm 
nitrogen management was developed and implemented in New York.
    A second goal of the program is to investigate several interactions 
between agriculture and climate change. Studies of methane fluxes to/
from soils showed that northern hardwood forests are both a source and 
a sink for this powerful greenhouse gas and overall may be a net source 
of methane. In contrast, upland agricultural systems were consistently 
found to be a sink for methane. Use of legume green manures to supply 
nitrogen in an organic production system increased methane emissions 
two-fold, creating a conflict between a sustainable agriculture 
practice and the environment.
    No-tillage agriculture was shown to increase preservation of 
existing soil organic carbon, but accumulation of carbon derived from 
crop inputs was higher with conventional tillage. Inputs of carbon to 
soils from root exudates and residues were found to be more important 
to carbon sequestration in soils than were residues from the tops of 
plants.
    A third goal of developing innovative approaches to management 
systems and technologies has the following components:
  --Whole farm analysis and planning
  --Soil quality changes in the Chesapeake farms sustainable 
        agriculture project
  --Use of constructed wetlands to mitigate phosphorus run-off from 
        barnyards Assessments of nutrient use and management on farms 
        have been carried out in Cayuga County, New York and in 
        Pennsylvania, in conjunction with Rodale Institute. In New 
        York, mass nutrient balance data on dairy farms has shown that, 
        because of nutrient imports in feed and inadequate cropland 
        area, nutrients excreted in manure exceed crop requirements. 
        Coupling of models for nutrient management and animal diets was 
        used to develop improved management practices. On one farm, 
        production of nitrogen in manure was reduced 25 percent by more 
        accurate balancing of animal diets and on a second farm 
        modification of the cropping pattern reduced the imported 
        nitrogen in feed by 13 percent.
    Soil quality assessments at the Chesapeake farms sustainable 
agriculture project on Maryland's Eastern shore, where various cropping 
systems are being compared with the conventional corn-soybean rotation, 
have shown that soil quality improves as the cropping system becomes 
more complex, involves less tillage, and has more organic inputs.
    Mitigation of phosphorus in runoff from barnlots by a constructed 
wetland system is being evaluated on a 500 head dairy farm in New York. 
Different substrates in the wetland beds are being evaluated, including 
soil, limestone, norlite, and wollastonite. To date, the soil and 
norlite materials are proving to be the most effective at phosphorus 
removal.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
with an appropriation of $297,000. The fiscal years 1992-1993 
appropriation was $575,000 per year; $540,000 in fiscal year 1994; and 
fiscal years 1995 through 1999, $486,000 each year. A total of 
$4,417,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In fiscal year 1991, Cornell University provided $27,893 
and the State of New York provided $118,014. In fiscal year 1992, 
Cornell University provided $37,476 and the State of New York $188,915. 
In fiscal year 1993, Cornell University provided $13,650 and the State 
of New York $243,251. In fiscal year 1994, the State of New York 
provided $214,989. In fiscal year 1995, the State of New York provided 
$233,085. In fiscal year 1996, the State of New York provided $388,301.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at Cornell University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original estimate was for a five-year program, and many 
of the initial objectives in the nitrogen and climate change areas have 
been met. New objectives evolved from the original, work and the 
program was also oriented to consider broader dimensions of 
environmental management, particularly strategies for community-based 
watershed management, involving linkage of technical knowledge with 
social and local governmental perspectives and needs. Estimated 
completion dates for current program elements are:
    1998-1999 program year:
  --Nutrient processing in wetlands
  --Use of weather forecasts in weed management
  --Use of constructed wetlands to remediate barnyard run-off
  --Effect of climate variability on crop production
  --Carbon storage in soils
    Completion beyond 1999:
  --Watershed science and management
  --Effects of elevated CO2 on crop yield potential
  --Remington farms sustainable agriculture project--a 10-year project
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project was peer reviewed in 1997 and 1998. Overall, 
the project was rated very high. Specific ratings included the 
following:
  --Outstanding scientific merit.
  --Appropriate methodology.
  --Excellent previous accomplishments.
  --The project has potential for significant impact concerning the 
        relationship of agriculture to global change.
  --The proposal is well conceived and well written.
              environmental risk factors/cancer, new york
    Question. Please provide a description of the work that has been 
funded under the Environmental Risk Factors/Cancer, New York, grant.
    Answer. The agency has requested the University to submit a renewal 
grant proposal that is currently being reviewed.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, and local need for this 
research?
    Answer. The American Cancer Society estimated that over 178,000 
women in the United States were diagnosed with breast cancer in 1998. 
The role of environmental risk factors, such as pesticides, is of 
concern to women, the agricultural community, and policymakers. This 
project, emphasizing risk reduction prevention information, will work 
at filling that void.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original and continuing goals of this research are:
  --To establish and maintain a database of critical evaluations on the 
        current scientific evidence of breast carcinogenicity and 
        effects on breast cancer risk for selected pesticides.
  --To effectively communicate database information to the scientific 
        community, federal agencies, pubic health professionals, the 
        agricultural community, and the general public using innovative 
        electronic methods of communication, in-service training 
        sessions, printed materials, and exhibits.
  --To further develop the Breast Cancer Environmental Risk Factors--
        BCERF--World Wide Web to improve ease of use, add informational 
        materials and hyperlinks, and determine the feasibility of 
        developing an online, searchable bibliography on pesticides and 
        breast cancer risk accessible through this Web site.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1997, 
and appropriations were as follow: fiscal years 1997, 1998, and 1999, 
$100,000 per year for a total of $300,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $150,000 state appropriations for fiscal year 1996; 
$250,000 per year in state funds--New York--were requested for fiscal 
years 1997, 1998, and 1999.
    Question. Where is this work being carried out?
    Answer. This research is conducted at the Cornell University, 
Ithaca, New York.
    Question. What was the anticipated completion date for the original 
objective of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This was a new project which began in April 1997. The 
anticipated completion date is March 31, 1999.
    Objectives met: Database was established during year one and is 
updated and expanded each year. It currently has over 2,400 entries 
with over 200 added each quarter. Also, it includes full bibliographies 
of all pesticide and dietary/lifestyle scientific critical reviews. 
Scientific Critical Evaluation of seven pesticides--four in fiscal year 
1997; three in fiscal year 1998--have been completed or are nearing 
completion. Two pesticides and/or non-pesticide agrochemical will be 
developed in fiscal year 1999. Science-based information material--fact 
sheets--have been developed not only for the seven pesticides, but also 
for four diet/lifestyle breast cancer risk factors, plus two on water 
contaminants and cancer, two on food safety, and two general fact 
sheets on breast cancer. Nine additional fact sheets are to be 
developed in fiscal year 1999. Two video teleconferences and an in-
service have been held and evaluated. Followup telephone surveys of 
1997 facilitators at BCERF satellite video conference downlink sites 
and participants at the June 1997 on-campus training program was 
completed, and an analysis of response data was initiated. The Farm 
Exhibit is expected to be completed in Spring 1999 and evaluated during 
Summer 1999. The BCERF website was revamped in 1997-1998 and relaunched 
in September 1998. The number of browsers accessing the BCERF home page 
has risen from 380 to 450 hits per month during the summer of 1998 to 
1,053 hits in November and 3,490 hits in December.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. As a relatively new project, a complete evaluation has not 
been conducted, although the proposal is currently under review. 
Periodic progress reports have been made throughout the year. The 
project is moving towards achieving its desired goals. A final 
evaluation will be made after March 31, 2000.
    BCERF has done an evaluation of the video teleconferences and in-
service and have had the pesticide fact sheets reviewed by several 
focus groups--breast cancer survivors and women not having breast 
cancer.
    The participants brought a variety of perspectives to the 
discussion, providing BCERF with a wealth of important feedback on our 
fact sheets and educational approach. Some of the conclusions we have 
drawn from this evaluation have already resulted in simple changes made 
in the preparation of current fact sheets. Other feedback from this 
evaluation will inform our planning efforts for the education component 
in general.
                    expanded wheat pasture, oklahoma
    Question. Please provide a description of the research that has 
been funded under the Expanded Wheat Pasture, Oklahoma grant.
    Answer. This project was designed to develop improved 
supplementation programs and new systems for technology delivery to 
reduce production risk of raising cattle on wheat pasture. The work 
involves evaluation of grazing termination date on grain and beef 
production, assess the impact of wheat cultural practices, and develop 
an economic model to evaluate alternative decisions on grain/beef 
production. Additional effort is directed toward development of cool 
season perennial forage grasses to complement wheat pasture. The 
proposal for fiscal year 1999 has been requested.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that this work addresses 
the needs of wheat/cattle producers of Oklahoma as a primary focus. 
However, it would appear to have application regionally in adjacent 
wheat growing states.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to develop 
economically-viable management systems for use of wheat for 
supplemental pasture for beef cattle before the crop starts making 
grain. This work has already shown how the use of feed supplements can 
increase net profit from cattle grazing on wheat pasture. The study has 
identified management practices, e.g. date of planting, cultivar 
selection, grazing intensity, and date of cattle removal that produce 
the optimum grain yield and cattle gain. A Wheat/Stocker Management 
Model has been developed as a decision aid to help producers assess 
income risk in the operation. Work is underway on a Wheat Grazing 
Systems simulation model.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1989 
and appropriations were as follows: fiscal year 1989, $400,000; fiscal 
year 1990, $148,000; fiscal year 1991, $275,000; fiscal years 1992-
1993, $337,000 per year; fiscal year 1994, $317,000; and fiscal years 
1995-1999, $285,000 each year. A total of $3,239,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $175,796 state appropriations in 1991; $174,074 state 
appropriations in 1992; and $236,584 state appropriations in 1993. The 
non-federal support for 1994 was $238,058 for state appropriations. 
Funds for fiscal year 1995 were $275,426, for 1996 were $120,000, for 
1997 were $190,510, and for 1998 $224,500.
    Question. Where is this work being carried out?
    Answer. The research is being done at Oklahoma State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This project started in 1989 with a projection of 10 years 
to complete the research objectives. Some objectives are nearing 
completion while others will require further study. A number of wheat 
cultivars have been identified which will tolerate grazing and still 
produce economic grain yields. The grazing cut off date for grain 
production has been established. However, year to year variation need 
additional study in order to develop a reliable decision support 
system.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This program is reviewed annually. Each year's funding 
cycle is peer reviewed internally and by CSREES National Program 
Leaders for scientific merit and relevance. Results from this project 
are currently being used by ranchers to help with management decisions 
concerning stocker cattle grazed on wheat that will be harvested for 
grain. Current work is designed to refine the current information and 
identify wheat cultivars and grazing management for optimum economic 
return.
                   expert ipm decision support system
    Question. Please provide a description of the research that has 
been funded under the Expert IPM Decision Support System grant.
    Answer. A prototype information and decision support system was 
developed in collaboration with Purdue University and the Department of 
Energy's Argonne National Laboratory that integrates and manages 
information from multiple data sources. Development of this system now 
continues with the collaboration of the Office of Pest Management 
Policy--OPMP--and the National Science Foundation Center for Integrated 
Pest Management--CIPM--at North Carolina State University--NCSU. 
Components of the Pest Management Information Decision Support System--
PMIDSS--include information on the U.S. Environmental Protection 
Agency--EPA--review status of pesticides, crop losses caused by pests, 
status of minor use registrations--IR-4--current research in progress, 
and priorities of IPM implementation teams. The PMIDSS data, along with 
OPMP/Pesticide Impact Assessment Program--PIAP--crop profiles, provide 
the background information that is critical to the development of 
commodity-specific transition strategies in response to the Food 
Quality Protection Act--FQPA--driven regulatory decisions.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. When fully operational, the PMIDSS will serve national, 
regional, and local needs for research and extension activities. At the 
national level, the system supports the USDA/EPA Memorandum of 
Understanding--MOU--to identify crop protection gaps and to find 
alternatives to pesticides either under FQPA regulatory review or those 
being lost due to pest resistance. The system will assist in the 
identification of priorities for the Pest Management Alternatives 
Program and regional IPM Special Grants and Special Projects. It will 
provide a mechanism for decision transparency and for all stakeholders 
to interact with the priority setting process. The ultimate result will 
be to help insure that farmers have adequate alternatives for managing 
pests at the specific local level.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the PMIDSS was to refine the process of 
identification for IPM needs of USDA, EPA, and the states. This goal 
reinforces the state and Federal partnerships to disseminate important 
pest management information for improved decision making and 
environmental quality, and to address future needs. In 1996 and 1997, 
the program addressed priority commodity pest management needs 
resulting from voluntary pesticide cancellations and regulatory 
cancellations, responding to the MOU and a supplemental MOU between EPA 
and USDA. The supplemental MOU was signed in April 1996, at which time 
there were 58 pesticides and 374 uses identified and prioritized. The 
process included information on cancellations furnished by EPA. 
Selected uses were sent to the states' PIAP and IPM networks. Impacts 
of cancellations affecting individual states were reported for 
inclusion in the decision support system. Twenty-five minor use crops 
on which 40 specific pests were identified in the 1997 Request For 
Proposals. Results were also used by the regional IPM grants program 
Request For Proposals. The Pest Management Alternatives Program 
WorkBench prototype--a major component of PMIDSS--was made accessible 
on a test basis through a web-based server maintained by the CIPM at 
North Carolina State University and the software has been delivered. A 
web-based pest management information system that allows concurrent 
multiple database searches of four key databases--Crop Profiles, 
National Council for Food and Agricultural Policy--NCFAP--Pesticide Use 
Data, OPMP Pipeline, and the Reregistration Notification Network--is 
presently available through a secure web server maintained by CIPM.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work began in 1994 with development of the concept and 
design, and has proceeded through steps including database 
identification and specific development of a prototype and software. 
Current development is to bring the product to the web and provide 
multiple database search capabilities for ease of data access. In 
fiscal year 1994, we expended $40,000 of CSREES administrative funds 
and $90,000 from Science and Education Evaluation Funds to initiate 
collaborative work with the Argonne National Laboratory. In fiscal year 
1995, we expended $172,000 as a Cooperative Agreement with Purdue 
University and Argonne National Laboratory from the Pest Management 
Alternative Special Grant Funds and $5,000 from PIAP funds. In fiscal 
year 1996, we expended $177,000 in a cooperative agreement with Purdue 
University and Argonne National Laboratory from Pest Management 
Alternative Special Grant Funds, $21,000 from Research, Extension, and 
Education Evaluation Funds, and $40,000 from PIAP funds--for 
development of PIAP data fields. In fiscal years 1997 and 1998, we 
expended $165,425 and $177,000 to Purdue University and Argonne 
National Laboratory. In fiscal year 1999 we are expending $177,000 to 
NCSU-CIPM, to make the system web-based and provide access to multiple 
databases.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. It is difficult for us to estimate the amount of non-
federal funds supporting the PMIDSS. Purdue University, Cornell 
University, and NCSU have contributed non-federal resources in the form 
of dollars and personnel time. The CIPM at NCSU is supported in large 
part by corporate funds, part of which have underwritten Center 
personnel salaries. A number of states have provided information that 
is part of the information base. Many program areas are contributing 
databases that are part of the Pest Management Information Decision 
Support System.
    Question. Where is this work being carried out?
    Answer. Presently, the bulk of the work is carried out in 
Washington, D.C. and in Raleigh, North Carolina. CSREES has National 
Program Leaders in IPM, PIAP, and IR-4 program areas working on PMIDSS. 
The CIPM at NCSU manages the web server where the prototype and a pest 
management information system is located and is developing the multiple 
concurrent database search and decision support capability. Interaction 
and information is provided by every state in our system. We are in the 
process of strengthening the role of Land Grant partners in this 
program and additional database access is being developed through CIPM 
at NCSU and through a sub-contract with George Mason University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Our original estimate was two to three years with adequate 
resources to complete the developmental work. However, the design 
considerations became more complex with the 1996 passage of the FQPA. 
Program needs dictated an expansion and change in information bases. In 
addition, technology that was unavailable in 1994--the web--is now a 
major and needed part of the program strategy. We feel we are 
reasonably addressing FQPA objectives with available resources to 
become an ongoing activity of the USDA. Utility of the system to the 
Agency, Land Grant partners, and the private sector stakeholders will 
increase as additional databases are added to both the data access and 
decision support aspects of the project. It is critical that the data 
sources be maintained as part of an interconnected system. Toward that 
end, the PMIDSS team is now working directly with many data providers--
IR-4, NASS, NCFAP--and users--CSREES, OPMP, EPA, commodity groups, and 
agribusiness--to assure that needed data are available, consistent, 
current, and searchable. The PMIDSS program is a key component for 
transparent data access and decision support for FQPA responses by OPMP 
and CSREES.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation.
    Answer. PMIDSS underwent a formal review in June 1997, and a major 
piece of the system, the Pest Management Alternatives Program 
WorkBench, was reviewed by regionally-selected land grant scientists 
and others in November 1997. In August 1998, a progress review 
evaluated the engineered software product and determined the need for a 
web-accessible multiple database search and look-up function for the 
system. A concept review held in September 1998 demonstrated the 
functionality of a web-based decision support system. The June review 
recommendations included: focus the system on the needs of the Pest 
Management Alternatives Program, timely delivery of the software 
product to USDA, and development of a plan to sustain the system in a 
user-friendly, widely available format. The November evaluation of the 
WorkBench brought the following comments and recommendations: the 
WorkBench provides good linkages to relevant databases and brings 
together essential information on pest management issues; the system 
should be placed on the World Wide Web for greater access and utility; 
tell potential users that it is available; and invest in high quality 
databases to support and enhance data integrity of the WorkBench. 
Development now focuses on the needs of the Pest Management 
Alternatives Program, the requirements of FQPA, and an easy-to-use 
interface for data search and access. Data access is focused on current 
and transparent databases to address critical FQPA needs.
         farm and rural business finance: illinois and arkansas
    Question. Please provide a description of the research that has 
been funded under the farm and rural business finance program.
    Answer. Federal funding for this project provides partial support 
for the Center for Farm and Rural Business Finance which conducts a 
program of research and information on the financing of farms and rural 
businesses in the United States. The plan of work focuses on the 
financial management performance of farm and rural businesses, 
evaluation of financial markets and credit institutions serving rural 
America, and the impacts of public policies and regulations on the 
structure and performance of rural financial markets. This project 
addresses some of the same issues included in the RRF Project NC-221, 
Financing Agriculture and Rural America: Issues of Policy, Structure, 
and Technical Change. Professional staff at the two institutions are 
engaged in both projects. Proposals for the grant funds for this 
special project are peer reviewed at the performing institutions and 
are reviewed for merit within the CSREES when received. Additional peer 
review occurs with the Hatch project included in NC-221.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The need is national in scope in that the shifting policy 
environment, the changing structure within the agricultural sector, and 
managerial responses to technical change and changes in tax regulations 
have nationwide impacts. Regional and local needs vary with the 
commodity mix in the agricultural sector and the availability of 
financial institutions and services to meet local needs. The new 
agricultural policies that have altered the ``safety net'' 
significantly increase the financial risk for farmers, ranchers, and 
agribusinesses. Changes to the Federal income tax, capital gains tax, 
and estate tax provisions can have significant impacts on owners of 
agricultural assets. Consolidations are occurring within the Farm 
Credit System, and increased integration and coordination at the farm 
level within hog and other concentrated enterprises are providing 
access to additional sources of capital.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal is to assist farmers, ranchers, and rural 
businesses with research-based information on financial management as 
they face increasingly complex financial markets. The project is 
completing projects on the post-acquisition performance of banks 
resulting from recent mergers, levels and trends in small farm and 
small business lending across different types of commercial banks, and 
the measurement and classification of the financial performance of 
agribusiness firms. Additional projects have developed a model of 
working capital management applicable to a wide variety of selected 
agribusiness firms and have identified primary risks associated with 
lending to integrated farm production units. Other projects are 
measuring the longer term impacts of changes in the Federal tax laws on 
the financial performance of Illinois farms, evaluating the financial 
characteristics of rural banks and assessing their competitiveness in 
rural financial markets, and identifying the financial characteristics 
of high performing agricultural banks. A project at the University of 
Arkansas is analyzing the effects of financing in accelerating the 
cattle cycle.
    Question. How long has the work been underway, and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work has been underway since 1992. Appropriations were 
$125,000 in fiscal year 1992, $125,000 in fiscal year 1993, $118,000 in 
fiscal year 1994, $106,000 per year in fiscal year 1995 through fiscal 
year 1997, $87,000 per year in fiscal year 1998 and fiscal year 1999. 
Appropriations through fiscal year 1999 total $860,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal sources and funds provided for this program 
in fiscal year 1992 totaled $259,427 with $58,427 in State 
appropriations, $189,000 from industry and $12,000 from miscellaneous 
sources. In fiscal year 1993, the total was $287,890 with $94,588 in 
State appropriations, $133,000 from industry, and $25,000 from 
miscellaneous sources. In fiscal year 1994, the total was $391,000 with 
$221,000 coming from State appropriations, $45,000 from industry, and 
$125,000 from the National Research Initiative competitive grants 
programs. In fiscal year 1995 the total was $185,000 where $46,000 came 
from State appropriations, $62,500 from industry and $76,500 from 
miscellaneous sources. In fiscal year 1996, the total was $344,000 
where $294,000 was appropriated from State sources and $50,000 from 
private sources. In fiscal year 1997, $125,000 was appropriated from 
State sources, $103,000 was received through a National Research 
Initiative grant, and $130,876 was received from the Council on Food 
and Agricultural Research. In fiscal year 1998, $176,250 was received 
from a Fund for Rural America grant, $65,000 from a CSREES Special 
Research Grant, and $20,000 from miscellaneous sources. Non-federal 
support for fiscal year 1999 has not been identified.
    Question. Where is the work being carried out?
    Answer. Researchers and professional staff conducting this program 
are located at the University of Illinois and the University of 
Arkansas.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives of the program, as amended with 
additional funding and new termination dates, now extend to fiscal year 
1999. Although initial objectives have been met, new developments in 
the rural finance environment call for continuing work to address new 
dimensions of the objectives. Anticipated completion dates of these 
amended objectives extend through fiscal year 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the latest evaluation conducted.
    Answer. The project is evaluated periodically during the year 
through direct contact with the Director of the Center and the project 
leaders, as reports are received, and annually when proposals are 
submitted. Internal agency criteria are used to evaluate the program in 
terms of whether objectives are being met, appropriate methods are 
being used, and timelines are being met to a reasonable extent. The 
general objectives of this program continue to be met and results from 
specific projects are evaluated as they evolve. The latest evaluation 
shows 16 separate projects underway that have or are nearing 
completion. Results are applicable to issues within the rural finance 
community. A National Symposium for Agricultural Finance Executives 
provides a valuable service and visibility for the Center. The program 
has led to an impressive number of publications by the Project Director 
and the project leaders. Articles have been published in leading U.S. 
agricultural and finance journals and in international journals 
addressing the same topics.
               feed barley for rangeland cattle, montana
    Question. Please provide a description of the research that has 
been funded under the Feed Barley for Rangeland Cattle, Montana grant.
    Answer. This project will support research on the nutritional value 
of barley cultivars as feed for beef cattle. This effort will assist 
with the breeding and selection of superior types that can be more 
competitive with other feed grains and improve farmer income from 
barley crops grown in rotational systems in the Northern Great Plains. 
The project was subjected to a merit review.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Barley as a feed grain is grown extensively in the United 
States. Based on chemical analyses and the experience of some cattle 
feeders, the principal researcher believes it should have a feed value 
on par with corn and wheat. However, it is listed as inferior to both 
in feeds hand books and is, therefore, discounted in the market. 
Comprehensive feeding studies of various barley types will be conducted 
to document the value as a feed grain for beef cattle.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to determine the 
true feed value of barley for feeder cattle, and thereby improve the 
economic return to barley production.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1996 
and the appropriation for fiscal year 1996 was $250,000, for fiscal 
year 1997, $500,000, and in fiscal years 1998 and 1999, $600,000 per 
year. The total appropriation is $1,950,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds for this project were $160,000 in 1996, 
$174,500 in 1997, and $168,000 in 1998.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Montana State University.
    Question. When was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion of the original objective is 
fiscal year 2001. Integrating of findings into management systems is 
expected by 2005 with outreach and information dissemination completed 
by 2010.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted?
    Answer. The project is evaluated annually. It undergoes a 
scientific merit review by two Department Heads and three peer faculty 
members. It is reviewed again by a CSREES scientist upon submission.
                          floriculture, hawaii
    Question. Please provide a description of the research that has 
been funded under the floriculture program grant.
    Answer. The research carried out with these funds involves 
wholesale and retail U.S. and Japan market research, development of new 
varieties for aesthetic values and pest resistance, and pest management 
strategies to meet quarantine needs and consumer expectations.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The researcher believes the tropical cut flower and foliage 
industry in Hawaii, which includes anthurium, orchids, flowering 
gingers, bird of paradise, heliconia, protea, and cut foliage is worth 
over $50,000,000 primarily in out-of-state sales. Development of 
disease resistant cultivars and quarantine pest management strategies 
that reduce pesticide usage are high priority issues at the national 
level.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the research was to develop superior 
Hawaii anthuriums, orchids, protea, and exotic tropical flower 
varieties with disease resistance, particularly to anthurium blight 
which devastated the Hawaii anthurium industry through the mid-1980's 
and reduced Hawaii's market share. Additionally, research focused on 
development of post-harvest handling practices and quarantine pest 
control. To date, a new anthurium cultivar has been patented and 
released. Additional blight resistant cultivars are being propagated 
and tested by the anthurium industry. Disease resistant protea 
germplasm has been obtained from South Africa and is being used in the 
protea breeding program. A post-harvest hot water dip treatment has 
been developed and is being used commercially on tolerant cutflower 
species to meet quarantine requirements.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $300,000; fiscal years 1990-1993, $296,000 
per year; fiscal year 1994, $278,000; and fiscal years 1995-1999, 
$250,000 each year. A total of $3,012,000 has been appropriated since 
1989.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: State appropriations of $87,937 in 1995, $56,680 in 
1997, and $62,600 in 1998 for a total of $207,217 since 1995.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by the University of Hawaii at 
Manoa and Hilo.
    Question. When was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objectives in the original project were to maintain 
Hawaii floricultural industry competitive. This objective continues to 
be the principal direction for the projects. Because the industry and 
the markets are changing pests are becoming either resistant or newer 
strains. And quarantines are changing with technology the objective 
remains valid.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The individual projects funded under this Special Research 
Grant are evaluated through merit review to ensure that good science is 
being used. This evaluation is the major tool used to award funds to 
the projects.
        food and agriculture policy institute, iowa and missouri
    Question. Please provide a description of the research that has 
been done at the food and agriculture policy institute program.
    Answer. The Food and Agriculture Policy Research Institute--FAPRI--
was established by Iowa State University and the University of 
Missouri, Columbia, in 1984. The purpose of the institute is to conduct 
comprehensive analyses and disseminate results about the economic 
impacts of U.S. food, farm, and trade policies to agricultural 
producers, agribusinessmen, and public policymakers. Iowa State 
conducts research on the economic interrelationships within and between 
domestic and foreign food and agricultural markets from the farm gate 
to market destinations; develops and maintains databases and analytical 
support systems to facilitate the analysis of agricultural and trade 
policy issues; and evaluates the impacts of U.S. and foreign commodity 
supply, demand, and public policy programs on agricultural trade. The 
University of Missouri maintains models of the domestic agricultural 
economy and directs its efforts primarily to the analysis of domestic 
policy issues. The two universities maintain linkages with a number of 
other universities who provide data and analytical support to the 
system.
    The universities maintain a comprehensive analytical modeling 
system of the U.S. and international food and agricultural sectors to 
evaluate near-and long-term economic implications of alternative farm 
policies for the basic commodities. Each year, and more often if 
conditions require, the system is used to provide economic information 
on potential impacts out to 10 years in the future of farm policies on 
farm prices, income, output, government program cost and means to 
enhance the management of farm programs at the national level.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local need for this 
research?
    Answer. The Nation's agricultural sector and its components are 
subject to numerous Federal policies and programs. FAPRI is the only 
publicly-supported, non-federal organization with the analytical 
capability to assess and evaluate the numerous public policies and 
programs affecting the agricultural sector and report results to a 
broad constituency including farmers, agribusinessmen, and Federal and 
State policymakers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to develop the analytical capability 
to assess and evaluate U.S. farm policies on the U.S. agricultural 
sector and disseminate this information to farmers, farm and other 
agricultural organizations, and public policymakers. The mission has 
been expanded to include assessment of trade and environmental policy 
impacts and their interaction with the agricultural sector at national, 
regional, and farm levels. The models in place are also used to assess 
fiscal and monetary policy implications and impacts of new technologies 
such as biotechnological innovations on the agricultural sector.
    Both institutions maintain large econometric models and data sets 
which are regularly updated to analyze farm and trade policy 
alternatives and the impacts of various programs on the several sub 
sectors of the agricultural economy. This update was especially 
valuable for conducting analyses to assess policy options for the 1996 
farm bill. During the past year, the FAPRI completed 35-40 studies 
addressing policy issues such as assessments of the 1996 Farm Bill, 
alternative ethanol programs, USDA's proposed milk market order reform, 
U.S.-Canada agricultural trade, the importance of fast track to U.S. 
agriculture of economic recession in the Middle East and the economic 
meltdown in Russia. Numerous studies were completed addressing 
improvements made to the empirical modeling system to improve domestic 
and international policy capabilities. The FAPRI staff has made 
numerous public appearances throughout the U.S. to agricultural groups 
and Congressional committees and Executive branch groups addressing 
policy issues.
    Question. How long has the work been underway and how much has been 
appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1984-1985, $450,000 per year; fiscal years 1986-
1987, $357,000 per year; fiscal year 1988, $425,000; fiscal year 1989, 
$463,000; fiscal year 1990, $714,000; fiscal years 1991-1993, $750,000 
per year; fiscal year 1994, $705,000; fiscal years 1995-1996, $850,000 
each year; and fiscal years 1997-1999, $800,000 each year. The total 
amount appropriated is $10,271,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $260,355 State appropriations, $113,565 industry, and 
$37,913 miscellaneous for a total of $411,833 in 1991; $321,074 State 
appropriations, $51,500 industry, and $35,100 miscellaneous for a total 
of $407,674 in 1992; $234,796 State appropriations and $70,378 industry 
for a total of $305,174 in 1993; $78,286 State appropriations, $43,925 
industry, and $29,750 miscellaneous in 1994 for a total of $151,961 in 
1994; $80,155 State appropriations, $37,128 industry, and $42,236 
miscellaneous for a total of $159,519 for 1995; $124,123 in State 
appropriations with no other funding for 1996; and $79,000 in State 
appropriations, $50,000 industry, and $25,000 miscellaneous for a total 
of $154,000 in 1997; and $88,800 State appropriations, $75,200 
industry, and $34,687 miscellaneous for a total of $198,687 in 1998.
    Question. Where is this work being carried out?
    Answer. The program is carried out at the Center for Agriculture 
and Rural Development, Iowa State University and the Center for 
National Food and Agricultural Policy, University of Missouri.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This is a continuing program of research and analysis for 
the purpose of assessing farm and related policy actions and proposed 
actions likely to affect the agricultural sector and its components.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The annual proposal is carefully reviewed for adherence to 
stated objectives and progress before the special research grant in 
awarded. It is also peer reviewed prior to its submission. No formal 
evaluation of this program has been conducted.
                         food irradiation, iowa
    Question. Please provide a description of the research that has 
been funded under the food irradiation grant.
    Answer. Since the Linear Accelerator Facility was placed in 
operation in March 1993, studies on the effect of irradiation on shelf-
life extension, safety, and quality of ground beef, beef steaks, ham, 
pork chops from loins, chicken breasts, and turkey have been conducted. 
Studies combining irradiation with high hydrostatic pressure and 
cooking, using whole chicken breasts, turkey, and ham, have been 
conducted to determine the combination of these treatments that will 
yield a shelf-stable product while maintaining high eating quality. 
Several studies were conducted to determine whether consumers can 
detect a difference between irradiated and non-irradiated ground beef 
patties. Experiments were also conducted to investigate consumer 
acceptance of pork products irradiated to prevent trichinosis. Test 
markets of irradiated chicken breasts were conducted to determine 
consumers' willingness to pay for irradiated products. Research on the 
effect of packaging materials on quality of irradiated meat is in 
progress. The fiscal year 1998 funds are supporting research from May 
1, 1998 through June 30, 1999. CSREES has requested, but not yet 
received, a proposal in support of the fiscal year 1999 appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes consumers' attention and 
concern about the safety of fresh meat and poultry has increased with 
recent outbreaks of foodborne illness from E. coli 0157:H7. The meat 
industry has also expressed interest regarding the quality of 
irradiated products and how this process can be used to yield high 
quality fresh meats that are free of pathogens. The recent massive 
recall of over 25,000,000 pounds of ground beef due to illness caused 
by E. coli 0157:H7 contamination has resulted in huge economic losses. 
With the recent Food and Drug Administration--FDA--clearance of 
irradiation of red meat, research needs leading to commercialization of 
this technology have been enhanced. Additionally, researchers from 
eight other research institutes have used the irradiation facility for 
research projects. Thus, the principal researcher believes this 
research to be of national, regional, and local need.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The original goal of the research was to generate knowledge 
necessary to develop a research and technology transfer program leading 
to commercial use of irradiation of foods, whereby consumers would be 
provided with food products with enhanced safety. The effectiveness of 
irradiation, using an electron beam accelerator, in destroying known 
pathogenic bacteria in pork and beef has been determined. Mathematical 
models have been developed to predict the growth of bacteria in low-
dose irradiated ground pork. Demonstration of irradiation technology 
has been presented to some commercial firms, and plans are being 
developed for some large scale test markets.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
when $100,000 was appropriated for this project. The appropriations for 
fiscal years 1992 and 1993 were $237,000 per year; fiscal year 1994, 
$223,000; fiscal years 1995-1997, $201,000 each year; and fiscal years 
1998 and 1999, $200,000 per year. A total of $1,800,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The project received $1,037,270 in State of Iowa funds--
$1,000,000 of which was for capital construction--in fiscal year 1991; 
$37,942 in state funds and $67,800 in industry grants in fiscal year 
1992; $68,897 in state funds, $78,300 in industry grants, and $9,666 in 
user fees in fiscal year 1993; $70,652 in state funds, $35,420 in 
industry grants, and $47,788 in user fees in fiscal year 1994; $72,772 
in state funds, $100,000 in industry grants, and $55,211 in user fees 
in fiscal year 1995; $81,540 in state funds, $115,300 in industry 
grants, and $50,963 in user fees in fiscal year 1996; $77,963 in state 
funds, $253,450 in industry grants, and $46,550 in user fees in fiscal 
year 1997; and $100,200 in state funds, $205,900 in industry grants, 
and $36,200 in user fees in fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Iowa State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigator anticipates that the project's 
original objectives will be met within a few years after the USDA final 
rules are issued.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A review of the proposal supporting the fiscal year 1998 
appropriation was conducted on January 16, 1998. Previous studies 
funded under this project have provided useful information toward 
understanding how irradiation can be useful in eliminating or reducing 
foodborne pathogens in meat products. It is anticipated that the 
proposed research will continue to further the understanding of how 
irradiation can be used to improve shelf-life and enhance safety of 
meats and meat products.
               food marketing policy center, connecticut
    Question. Please provide a description of the research done under 
the Food Marketing Policy Center grant.
    Answer. The Food Marketing Policy Center was established in 1988 at 
the University of Connecticut at Storrs. The Center conducts research 
on food and agricultural marketing and related policy questions. The 
intent is to provide information that contributes to improved 
performance of the food production and marketing system. The Policy 
Center is primarily an economic research organization, but it conducts 
interdisciplinary research as appropriate and it communicates results 
to the public. Key users include farm and consumer organizations, 
agricultural business firms, public agencies, state legislatures, and 
the U.S. Congress. The Center facilitates research at cooperating 
institutions by organizing research workshops twice annually, 
furnishing common data bases, preparing research publications, and 
providing leadership for joint research efforts including the 
sponsorship of research conferences.
    This grant is not competitively awarded at the state or regional 
level, but the proposal is reviewed by the Experiment Station Director 
and the Department Head, and is subject to internal merit review.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The research proposal identifies an ongoing national need 
to continually improve the economic efficiency and operation of the 
U.S. food marketing system to benefit farmers, merchants, processors, 
and consumers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The ongoing research goal is to identify marketing problems 
and assess alternatives that improve economic performance of the U.S. 
agricultural and food marketing sector. The Center serves as a core 
research group for Regional Research Project NE-165, Private 
Strategies, Public Policies, and Food System Performance. The research 
agenda includes industrial organization, strategic marketing, economics 
of food safety, cooperatives, and public policy including antitrust and 
regulation. The Food Marketing Policy Center conducts economic research 
on food marketing, including descriptions of food quality issues and 
enhancement policies, private label branding, advertising strategies 
for cooperatives, assessment of food retail mergers and competition, 
evaluation of dairy regulations, branded product marketing, supermarket 
chain entry, oligopsony in agricultural markets, and impacts of 
cooperatives on food market performance.
    The Center has prepared and distributed over 45 working papers, 35 
policy research reports, 16 policy issue papers, 8 books, and it has 
reprinted and distributed over 65 important journal articles to 
researchers, industry, and Federal and State legislators, and decision 
makers.
    This grant will support work on nine projects with two targeted 
research problem areas: impacts of changes in strategies, technologies, 
consumer behavior and policies on the economic performance of the food 
system, and economic analysis of private and public strategies to 
assess their impacts on improvements in food safety and quality. 
Projects include competitive strategy analysis of cooperatives and 
investor-owned firms; firm dominance in food manufacturing; 
advertising; mergers, product relatedness and performance outcomes; 
effects of market structure and concentration on promotional activity; 
testing theories of oligopoly conduct; relationships between market 
structure, firm position, and price levels; strategic responses to food 
safety and nutritional regulation; and trade agreement effects on food 
quality and trade.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1988, $150,000; fiscal year 1989, $285,000; fiscal 
year 1990, $373,000; fiscal years 1991-1993, $393,000 per year; fiscal 
year 1994, $369,000; fiscal years 1995-1998, $332,000 each year; and 
fiscal year 1999, $400,000. A total of $4,084,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are State appropriations as follows: $234,259 in fiscal year 1991; 
$231,741 in fiscal year 1992; $201,288 in fiscal year 1993; $234,557 in 
fiscal year 1994; $219,380 in fiscal year 1995; $134,399 in fiscal year 
1996; $135,490 in fiscal year 1997; and in fiscal year 1998, $164,772 
at the University of Connecticut and $30,000 at the University of 
Massachusetts. The decline reflects a change in reporting only salary 
and related fringe benefits and excludes overhead for facilities and 
utilities.
    Question. Where is the work being carried out?
    Answer. The research is being carried out by the Agricultural 
Experiment Station at Storrs and at the University of Massachusetts.
    Question. What was the anticipated completion date for the original 
objectives of the projects? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1987 was for 24 months. According 
to the principal researcher, the objective of conducting policy-
oriented research on food manufacturing and distribution industries to 
assist state and Federal policy makers in improving the performance of 
the food system is still an ongoing public concern, given increasing 
levels of concentration in food processing. The current phase, 
initially funded in fiscal year 1997, will be completed in 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES annually reviews project reports, succeeding annual 
project proposals, research studies, and educational programs. A merit 
review of the fiscal year 1998 proposal was conducted in February 1998, 
and a similar review of the fiscal year 1999 proposal will be 
conducted. A comprehensive outside review was conducted in April 1998. 
Assessment criteria include peer review of results and publications, 
administrative review and approval of proposals, and reports by 
external sources.
                    food processing center, nebraska
    Question. Please provide a description of the research that has 
been funded under the food processing center grant.
    Answer. The University of Nebraska Food Processing Center has been 
conducting short-term, highly-applied research projects to assist small 
and mid-sized food processing companies and entrepreneurs to develop or 
improve processes and products and to develop new food processing 
enterprises. Projects were selected based on the estimated economic 
impact of the technical assistance or the criticality of the technical 
assistance to the future of the firm or venture. Priorities were placed 
on projects relating to the safety of the food product or process and 
to the fulfillment of regulatory mandates such as nutrition labeling, 
use of approved and effective ingredients, and adherence to regulations 
imposed by foreign governments. In addition, several research projects 
were conducted to improve or assess the quality, extend the shelf-life, 
or assess or improve the processing efficiency of specialty food 
products which impacted several processors or used alternative 
agricultural products. fiscal year 1998 funds are supporting research 
from July 1, 1998 through June 30, 1999. CSREES has requested, but not 
yet received, a proposal in support of the fiscal year 1999 
appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the primary impact of 
this project will be statewide. Small and mid-sized food processing 
companies and entrepreneurs have limited technological capabilities for 
addressing issues related to product development, process development, 
product and process evaluation, food safety, quality assurance, and 
regulatory mandates. The short-term research and technology transfer 
projects conducted as part of this overall project will aid these 
companies in appropriately addressing these oftentimes complicated 
issues.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the research, as stated previously, is to 
assist small and mid-sized food processing companies and entrepreneurs 
to develop or improve processes and products and to develop new food 
processing enterprises. Technological evaluations were conducted for 
120 individuals or companies interested in developing new food 
processing businesses. These evaluations included formulations, 
processes, processing equipment, packaging, shelf-life, sensory, 
nutritional attributes, microbiological quality, regulatory 
considerations, and other factors. Additionally, microbiological 
analyses, shelf-life assessments, sanitation audits, and nutritional 
analyses were conducted for numerous Nebraska food companies.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1992. 
The appropriations were $50,000 per year for fiscal years 1992-1993 ; 
$47,000 for fiscal year 1994; and $42,000 per year for fiscal years 
1995-1999. A total of $357,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The Food Processing Center received $402,389 in State funds 
and $1,771,856 in food industry grants and miscellaneous sources from 
1992 through 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the University of Nebraska.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Because this project supports ongoing technical assistance 
to clients, the objectives are ongoing.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
A review of the proposal was conducted on January 12, 1998. Progress 
under previous grants for this project appears to be satisfactory, with 
numerous examples of assistance cited and summaries of short-term 
projects provided by the principal investigator.
                            food quality, ak
    Question. Please provide a description of the research that has 
been funded under the Food Quality, Alaska grant.
    Answer. This is a new grant in fiscal year 1999. Research will be 
aimed at establishing the Salmon Quality Implementation Project. The 
project has two parts. The first part is the evaluation, design, and 
implementation of a voluntary quality seal that can be attached to 
salmon that meet the existing standards for premium and number one 
grade. The second part is a series of workshops and training sessions 
on salmon quality handling and maintenance for workers at all levels of 
the industry, from harvesting to retail.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The seafood industry is Alaska's largest employer and main 
source of revenue in many communities along its 38,000 miles of 
coastline. The salmon fishery is second only to groundfish in providing 
the most value in the industry. It is the mainstay of many traditional, 
family-owned businesses. The salmon industry is regional, involving 
thousands of fishermen and processing workers from Washington State, 
Oregon, California, and throughout the nation that come to Alaska to 
participate in the fishery. In recent years, the Alaska salmon industry 
has suffered economically from increased competition from international 
salmon farmers, mainly in Norway and Chile. They have made great 
inroads in many traditional markets, surpassed Alaska in salmon 
production, and now set the product standard in the marketplace. One 
key for American businesses to recapture and strengthen their salmon 
markets is to guarantee and promote the quality of wild Alaska salmon. 
This project will provide the industry with the research and 
information needed to accomplish this.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The original goal of this research was to ensure a 
consistent and predictable level of handling and quality for Alaska 
seafood. In doing so, the project will help Alaska seafood processors 
strengthen or maintain their place in domestic and international 
markets. Because this is a new grant, no progress has yet been 
reported.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $350,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The State of Alaska, the Alaska Seafood Marketing 
Institute, and the industry will contribute considerable personnel 
hours to perform the work described in the application. The state will 
contribute the time of several staff people to research and help 
establish the voluntary quality seal program. Staff time would account 
for approximately $10,000. The Alaska Seafood Marketing Institute will 
have a staff person set up training workshops throughout Alaska.
    Question. Where is this work being carried out?
    Answer. The work will be administered at the University of Alaska 
Fairbanks. Field work will be carried out in numerous Alaska fishing 
communities.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the quality and 
handling training portion of the project is July 1, 2000. The 
anticipated completion date for the voluntary quality seal portion of 
the project is December 31, 2000. The project managers will able to 
report at that time on their success at meeting project objectives.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. It is anticipated that the proposal received in support of 
the fiscal year 1999 appropriation will be reviewed for merit by a 
CSREES specialist shortly after it is received by the agency.
                              food safety
    Question. Please provide a description of the research that has 
been funded under the Food Safety grant.
    Answer. This program is to provide funding for competitively-
awarded research grants. The focus of the program is on very high 
priority issues each year and it reflects areas of major importance 
under the Food Safety Initiative. The request for proposals for fiscal 
year 1998 focused on major issues related to the safety of fresh and 
minimally processed fruits and vegetable which is an area of concern to 
the public. For fiscal year 1999, we will request proposals that again 
address the safety of fresh fruits and vegetables, and request 
proposals in two additional areas of food safety of major importance: 
the scientific basis for critical control points in food processing and 
handling and risk assessments on bacterial pathogens in foods. For 
fiscal year 2000, the focus will continue to be on current and emerging 
National issues in food safety. The input of stakeholders and other 
Federal agencies will again be used to determine the focus. It is 
expected that risk assessments related to foodborne pathogens, the 
scientific basis for critical control points and critical limits, and 
the development of safe and efficacious techniques to enhance or ensure 
microbiological safety will continue to be important. The specific food 
groups targeted will be chosen to respond to high priority issues, and 
it is also anticipated that minimally-processed and ready to eat 
foods--which can include fruits, vegetables, meat, and dairy products--
will continue to be viewed as important.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. As part of the needed research effort under the President's 
Food Safety Initiative, this program addresses gaps in information 
available to support control measures in food safety in food 
production, processing, handling, and regulation. Several agencies and 
stakeholder meetings have combined to establish priorities for research 
for consumer protection and in support of regulatory actions in food 
safety. The request for proposals reflects these priorities.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this grant program is to support problem-
solving food safety research that addresses current and emerging 
National issues in food safety. It is intended to respond to high-
priority issues with information and interventions that will have 
applications in the near term. For this reason, the program stresses 
established or documented linkage with industry partner(s), and clear 
and effective plans for technology transfer to end users.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998. 
The appropriation for fiscal year 1998 was $2,000,000 and for fiscal 
year 1999 is $5,000,000. A total of $7,000,000 has been appropriated 
for this program. The fiscal year 2000 budget proposes $15,000,000 for 
an integrated program for food safety research and education.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Because this is a new program with the first awards being 
made in fiscal year 1998, we are unable to report contributions to this 
work from other funding sources.
    Question. Where is the work being carried out?
    Answer. Research funded through this program is being conducted at 
Cornell University, Rutgers University, North Dakota State University, 
Purdue University, Ag Innovations LLC, Pennsylvania State University, 
University of Delaware, University of Arkansas, University of 
Tennessee, Oregon State University, University of Florida, and Auburn 
University in 1998. All institutions will be able to compete for 
funding in 1999.
    Question. What was the anticipated date for the original objectives 
of the project? Have those objectives been met? What is the anticipated 
completion date of additional or related objectives?
    Answer. This program first received funding for fiscal year 1998 
and again in fiscal year 1999. Current and evolving concerns about food 
safety are expected to prompt continued funding of this program.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The research proposals for this program were evaluated by a 
peer panel of 13 scientists from universities, government, and 
industry. Of 40 proposals submitted to the peer review panel, 12 were 
selected for funding. The criteria used in evaluating the soundness of 
the proposed research were: conceptual adequacy of the hypothesis or 
approach as related to the program objectives; clarity and delineation 
of proposed project objectives as related to National issues and 
objectives; adequacy of the description of the proposed work; 
suitability and feasibility of the methodology for conducting the work; 
probability of success of the project; novelty, uniqueness, and 
originality; qualifications of the proposed project personnel, 
partnerships, and adequacy of the facilities; established or documented 
linkage with industry partner(s); and a clear and effective plan for 
educational outreach and technology transfer to end users.
                          food safety, alabama
    Question. Please provide a description of the research that has 
been funded under the Food Safety, Alabama, grant.
    Answer. CSREES has requested the university to submit a grant 
proposal that has not yet been received. Auburn Research Center's Food 
Safety Program will develop a method of food inspection that involves 
the placement of a sensor chip on food items. The goal is for these 
chips to automatically inventory and assess the safety at any point 
from source to consumption on every food product sold in the U.S.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Most food-borne illness can be attributed to bacteria. The 
sensor chips developed at Auburn University will target the bacteria 
that causes most of these illnesses. This technology could result in 
financial savings nationally, regionally, and locally through the 
prevention of food-borne illness and its related costs.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this project will be to reduce the 
incidence of food-borne illness through the use of a sensor chip that 
will assess the safety of food items as they move through the food 
chain. Since a grant proposal from Auburn University has not yet been 
received, there are no accomplishments to report to date.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant will begin in fiscal year 
1999 and the appropriation for fiscal year 1999 is $300,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Since a grant proposal from Auburn University has not yet 
been received, the source and amount of non-federal funds for this 
research is not yet known.
    Question. Where is the work being carried out?
    Answer. Research will be conducted at Auburn University, in Auburn 
Research Center's Food Safety Program.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
will be one year following the date of the award. The anticipated award 
date will be in April or May of fiscal year 1999. Since a grant 
proposal from Auburn University has not yet been received, related 
additional objectives are not yet known.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Since a grant proposal from Auburn University has not yet 
been received, this research has not yet been evaluated by the agency.
                 food systems research group, wisconsin
    Question. Please provide a description of the research that has 
been done under the Food Systems Research Group program.
    Answer. The Group conducts research on contemporary issues 
affecting the organization and competitiveness of the U.S. food system 
in domestic and international markets. The issues include new 
technologies, market structure, and government policies and programs. 
Studies have been completed on pricing of cheddar cheese, fed cattle, 
and hogs; changes in private label product markets; causes of 
structural change in the flour milling, soybean oil milling, wet corn 
milling, cottonseed milling, beef packing, and broiler processing 
industries; competition in U.S. food markets; and the relationship 
between U.S. food market structure and the industry's performance in 
global markets. The research proposal was subject to an administrative 
review and a peer review by the university prior to submission to 
CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes that the U.S. food system 
is changing rapidly in response to a large number of global economic, 
social, and technological changes. Research is needed to determine the 
effects of these changes on the system's organization and performance, 
and to ascertain needed adjustments in public policies based upon sound 
research. There is a national need to assess and evaluate the 
organization and performance of the Nation's food industry to ensure 
that it continues to satisfy performance expectations of farmers and 
consumers and adheres to acceptable standards of conduct. In spite of 
the growing concentration in food production-processing and increasing 
public policy questions concerning the performance of this industry, 
few organizations like the Food Systems Research Group are providing 
research needed for public and private decision making.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The original goal was to assess and evaluate the 
organization and performance of the U.S. food industry and provide 
recommendations for improvements. Recent work in the broiler industry 
shows that increased productivity and reduced real feed costs have 
significantly increased the competitiveness of the sector and 
stimulated market growth. Other empirical studies show that strong 
antitrust policies result in improved international competitiveness of 
U.S. firms, and that competition is essential for achieving greater 
efficiency and technological progress. A few years ago the Group 
completed a study of the National Cheese Exchange which resulted in a 
major public report, Congressional hearings, and a Wisconsin task 
force. Alternative pricing mechanisms were developed to avoid the 
problems of a very thin market which is used to price a large volume of 
off-market sales. The Group has completed numerous studies on economic 
structure and performance issues of the U.S. food manufacturing and 
distribution system. Basic research is conducted on market theories; 
effects of mergers, new technologies, and firm conduct on industry 
structure and organization; factors affecting industry prices, profits, 
efficiency, and progressiveness; and impact of public policies and 
regulations on food system organization and performance.
    Question. How long has this work been underway, and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1976-1981, $150,000 per year; fiscal years 1982-
1985, $156,000 per year; fiscal years 1986-1989, $148,000 per year; 
fiscal year 1990, $219,000; fiscal years 1991-1993, $261,000 per year; 
fiscal year 1994, $245,000; fiscal years 1995-1998, $221,000 per year; 
and fiscal year 1999, $225,000. A total of $4,472,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: State appropriations of $120,304 in 1991; $119,448 in 
1992; $85,188 in 1993; $96,838 in 1994; $59,435 in 1995; $50,636 in 
1996; $56,421 in 1997; and $64,004 in 1998.
    Question. Where is the work being carried out?
    Answer. The grant supports research at the University of Wisconsin, 
Madison.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1976 was for a period of 36 
months. The current phase of the program will be completed in 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES performed a merit review of the project in February 
1998, as it evaluated the 1998 project proposal, and concluded that the 
Food Systems Research Group at the University of Wisconsin does 
excellent research on structure, conduct, and performance of selected 
segments of the food industry, and has won many professional awards. 
Much of the work provides empirical tests of competing theories. In 
spite of the growing concentration in food production-processing and 
increasing public policy questions concerning the performance of this 
industry, few organizations like the Food Systems Research Group are 
providing research needed for public and private decision making. 
Research results appear in several peer reviewed professional journals 
and the popular press, and researchers have ongoing dialog with private 
and public decision makers.
                      forestry research, arkansas
    Question. Please provide a description of the research that has 
been done under the Forestry Research grant.
    Answer. The Arkansas Forest Resources Center offers programs of 
research, education, and outreach to the landowners of Arkansas and the 
surrounding region. This has been accomplished through continuing 
education events for landowners, the development of a series of 
distance-learning tutorials, and the funding of 20 assistantships for 
the first two classes of graduate students in the new forest resources 
master's program. A partial list of workshops includes: Uneven-aged 
Silviculture of Loblolly and Shortleaf Pine Forest Types, Environmental 
Law & Policy, Timber Income Tax Update, Thinning Methods and 
Operations, Introduction to ArcView 3.0, Estate Planning, Forest 
Finance Applications: Basic Tools for Daily Practice, and Opportunities 
in Forest Regeneration. The educational thrust has combined Center and 
private dollars to establish one of only three of the country's ArcView 
Learning Centers for natural resources. To better provide the highly 
educated professionals needed in the natural resources professions, 
educational tutorials are being developed in dendrology--tree ID, plant 
morphology, silvics--that aid in the (1) transfer of students in 
community colleges to institutions with forest resources offerings, and 
(2) forest resources education of non-majors at institutions without 
forest resources faculty. Furthermore, the University of Arkansas 
activated a new Master of Science program in the Fall 1998.
    Research projects address issues of species diversity, richness, 
redundance, and the resilience of disturbed and undisturbed hardwood 
stands of the Mississippi River floodplain. Furthermore, research has 
indicated that neotropical migratory birds are indicators of ecosystem 
health. Factors influencing their breeding range include habitat 
destruction/alteration and forest fragmentation. Thus, issues of re-
establishment and structure of hardwood stands are important for 
timber, non-timber values, and the quality of life enjoyed regionally, 
nationally, and internationally. Also, other projects are contributing 
to the development of (1) a biological control agent for the southern 
pine beetle, (2) alternative forest crops for the economically-
depressed Delta region, and (3) technologies for enhanced fiber and 
wood production from nonindustrial and industrial lands. Newer projects 
include an important regional social science study of the ethical 
values held by people of the southern United States. These issues will 
grow in importance as southern forests assume greater proportions of 
the national demand for fiber and wood.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, and local need for this 
research?
    Answer. With the reduced levels of production of wood products from 
the Northwest, southern forests are increasingly having to produce a 
major portion of wood products for the United States. This increased 
demand and production make it critical that the forestry community 
understand the possible environment effects of forestry practice. 
Social implications of the conflicts between forest production and 
environmental quality will become more and more important.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The thrust of goal one is developing alternative forest 
management strategies of achieving multi-resource objectives; i.e., 
production of timber, wildlife, recreation and other values of the 
forest on private industrial and non-industrial forest lands and pubic 
lands. Significant progress has been made in several areas. Some 
examples include: developing intensive fiber farming systems as 
alternatives to soybeans for Mississippi Delta farmers, taking the 
first step toward biological control of the southern pine beetle by 
discovering the nutrient needs of predators of the beetle so predators 
can be grown and studied in artificial cultures. The first survey of 
nonindustrial landowners in Arkansas for 15 years has been conducted. 
The survey shows that because of the average age of landowners--60+ 
years--there will be a massive change in ownership in the next 10-20 
years. Landowners continue to not be aware of assistance programs. The 
survey also indicated a concern about government programs and possible 
intervention on private land. This information will be useful in 
understanding future timber supply trends from private holdings and in 
the design of assistance and educational programs.
    Ongoing projects include a broad array of topics, competitively 
awarded within the Center. These include best management practices, 
ecological characteristics, effects of different forest management 
regimes, stream-sided buffer zone effectiveness, effects of winter 
logging, and secondary processing efficiency.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows:

        Fiscal year                                   Funds Appropriated
1994..........................................................  $470,000
1995..........................................................   523,000
1996..........................................................   523,000
1997..........................................................   523,000
1998..........................................................   523,000
1999..........................................................   523,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 3,085,000

    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funding and its source provided to this 
grant in 1994 was $411,726 State appropriations and $380,000 industry 
for a total of $791,726; $491,301 State appropriations and $785,262 
industry for a total of $1,276,563 for 1995; a total of $695,204 from 
State and industry sources for 1996; a total of $1,115,341 from these 
sources in 1997; and an estimated total of $1,000,000 for 1998. For 
1999, the State legislature appropriated approximately $850,000 above 
the 1998 level.
    Question. Where is this work being carried out?
    Answer. The Arkansas Forest Resources Center is administered from 
the School of Forest Resources on the campus of the University of 
Arkansas at Monticello. Individual studies are being conducted at the 
University of Arkansas at Fayetteville and several locations across the 
State.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Grants were received in 1994-1999 with funds distributed 
for use over the 3 to 5 years following the activation year. Projects 
are on schedule; work from 1994 funding is nearing completion. Forestry 
research is long term. Center objectives and selected projects will be 
continued beyond the life of individual grants, using the 
infrastructure and capacity developed with these Special Research 
Grants.
    Question. When was the last agency evaluation of the project? 
Provide a summary of the last evaluation conducted.
    Answer. In 1991, an agency team visited Monticello and reviewed 
faculty qualifications, supporting sources, and the feasibility of the 
proposal. The team exit report indicated the faculty was highly 
capable, the infrastructure needed strengthening, and the proposal 
concepts were feasible. Since 1991, there has not been a formal program 
review; however, a review is planned for the year 2000, pending fund 
availability.
       fruit and vegetable market analysis, arizona and missouri
    Question. Please provide a description of the research that has 
been funded under the fruit and vegetable market analysis program.
    Answer. The purpose is to provide timely knowledge and analysis of 
the impacts of trade, environmental, monetary, and other public 
policies and programs upon the Nation's fruit and vegetable industry to 
farmers, agribusinessmen, and policymakers through a program of 
empirical assessment and evaluation.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional or local need for this 
research?
    Answer. The U.S. fruit and vegetable sector is experiencing 
increased growth from greater domestic and export demand. However, the 
growth of this sector depends upon its ability to compete domestically 
and internationally and to conform with the regulatory environment in 
which it operates. This program of research provides increasingly 
critical information to farmers and policymakers on the implications 
and impacts of various policies and programs such as environmental, 
trade, labor, and food safety. It is the only such program providing 
analysis of the total U.S. sector.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to develop the analytical capability to assess 
and evaluate public policies and programs impacting the U.S. fruit and 
vegetable industry and disseminate the results to policy makers, 
industry organizations, producers, and other users. Proposals have been 
submitted that outline long-range plans and specific projects for 
funding. Models have been developed for 18 major, as measured in 
production, consumption, and trade, U.S. fruits and vegetables 
representing 80 percent of the farm value of the U.S. fruit and 
vegetable industry. Trade models for those commodities with a 
significant import and/or export sector will also be developed. These 
models feed into a larger food and agricultural sector model to support 
analyses of cross commodity and policy effects.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $329,000; for fiscal years 
1995-1998, $296,000 each year; and for fiscal year 1999, $320,000. A 
total of $1,833,000, has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funding and its source provided to this 
grant in 1994 was $50,073 State appropriations and $11,000 industry for 
a total of $61,073; $21,876 State appropriations and $36,624 industry 
for a total of $58,500 for 1995; a total of $62,400 from State and 
industry sources expected for 1996; and $50,000 each year from these 
sources in 1997 and 1998.
    Question. Where is the work being carried out?
    Answer. The work is being carried out at Arizona State University 
and the University of Missouri.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The university researchers anticipate that work is an 
ongoing project to look at the impact of various public policy 
proposals on the U.S. fruit and vegetable industry.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We have conducted no formal evaluation. However annual 
proposals are peer reviewed for scientific merit and relevance; also 
each annual budget proposal is carefully reviewed and work progress is 
compared with prior year's objectives. Informal discussions with 
congressional staff indicate that analyses are extremely useful.
                 generic commodity promotion, new york
    Question. Please provide a description of the research that has 
been done under the generic commodity promotion program.
    Answer. The grant supports, in part, the National Institute on 
Commodity Promotion Research and Evaluation which provides objective 
analyses of national and state commodity checkoff programs designed to 
enhance domestic and export demand. The overall project proposal was 
merit reviewed at the university level. A competitive peer review 
process is used to select specific research projects.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher states that producers are 
contributing about $1,000,000 annually to commodity research and 
promotion funds designed to expand the domestic and export markets for 
their products. The number of commodity groups participating and the 
size of the funds available could continue to grow. The 1996 Federal 
Agriculture Improvement and Reform Act--FAIR--requires all Federally-
constituted research and promotion boards to evaluate their programs at 
least every five years. Accurate evaluations require the development of 
sophisticated techniques that differentiate the impact of research and 
promotion expenditures from several other market influencing factors.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to determine the economic effectiveness of 
generic promotion programs designed to increase the sales of 
agricultural commodities in domestic and international markets. Recent 
accomplishments of this project include: access to a commodity 
advertising database for researchers; methodologies for using retail 
scanner data, estimating advertising wearout, and testing sensitivity 
of results based on various estimating procedures; relative 
effectiveness of advertising versus other kinds of promotion 
activities; and understanding of factors affecting producer attitudes 
toward checkoff programs. In addition, the Institute has sponsored 
educational workshops and conferences for directors and Chief Executive 
Officers of commodity research and promotion boards to help them comply 
with the FAIR Act requirements for evaluating promotion and research 
activities.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by the grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $235,000 and for fiscal 
years 1995-1999, $212,000 each year. A total of $1,295,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal matching funds and sources allocated to 
this grant by Cornell University are as follows: $97,333 a year in 
State appropriations for 1994-96; $125,650 for 1997; and $130,430 for 
1998. Collaborating institutions performing work under subcontract also 
contribute non-federal matching funds.
    Question. Where is this work being carried out?
    Answer. The work is being carried out at Cornell University in 
collaboration with eight other land-grant universities.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1994 was for a period of 21 
months, however, the need to evaluate the benefits of commodity 
promotion and research programs is a growing regional and national 
concern as producers take on greater responsibility for marketing their 
products. An increasing number of promotion and research programs are 
being evaluated. The current phase of the program will be completed in 
2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES performed a merit review of the project in February 
1998, as it evaluated the 1998 project proposal, and determined that 
``the project has sound objectives and procedures that are helping 
private and public decision makers effectively expand markets for U.S. 
agricultural products leading to a highly competitive agricultural 
production system and enhanced economic opportunity for Americans.'' 
The principal investigator is well recognized for his leadership in 
this area of research. Research results appear in several peer reviewed 
professional journals and popular press, and researchers have ongoing 
dialog with private and public decision makers.
                             global change
    Question. Please provide a description of the research that has 
been funded under the global change grant.
    Answer. Radiation from the sun occurs in a spectrum of wavelengths 
with a majority of wavelengths being beneficial to humans and other 
living organisms. A small portion of the short wavelength radiation, 
what is known as the Ultraviolet or UV-B Region of the spectrum, is 
harmful to many biological organisms. Fortunately, most of the UV-B 
radiation from the sun is absorbed by ozone located in the stratosphere 
and does not reach the surface of the earth. The discovery of a 
deterioration of the stratospheric ozone layer and the ozone hole over 
polar regions has raised concern about the real potential for increased 
UV-B irradiance reaching the surface of the earth and the significant 
negative impact this could have on all biological systems including 
man, animals, and plants of agricultural importance. There is an urgent 
need to determine the amount of UV-B radiation reaching the earth's 
surface and to learn more about the effect of this changing 
environmental force. The Cooperative State Research, Education and 
Extension Service, CSREES, is in the process of establishing a network 
for monitoring surface UV-B radiation which will meet the needs of the 
science community of the United States, and which will be compatible 
with similar networks being developed throughout the world. The fiscal 
year 1998 grant supports work through September, 1999.
    This grant is part of a government-wide initiative. The research is 
closely coordinated with other Federal agencies involved in the U. S. 
Global Change Research Program Inter-agency UV-Monitoring Network Plan.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes destruction of the 
stratospheric ozone layer, our shield from the full intensity of solar 
radiation, continues to increase. This creates a high priority need for 
information to document not only the levels of UV-B radiation reaching 
the earth's surface, but the climatology of that radiation. The United 
States, and the rest of the world, needs to know the strength of the 
UV-B radiation reaching the earth and the potential impact on all forms 
of life, especially animal and plant life of agriculturally-important 
species. The principal researcher believes this research to be of 
national as well as regional and local importance.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The USDA UV-B Network is to provide accurate, 
geographically-dispersed data on UV-B radiation reaching the surface of 
the earth and to detect trends over time in this type of radiation. A 
primary problem which had to be overcome in order to reach this goal is 
the development of instrumentation adequate to make the measurements 
required for the monitoring network. A major advance occurred during 
1996 with the availability to the network of a new multi-band 
instrument which will provide the spectral information needed to 
support both biological and atmospheric science research and to serve 
as ground-truth for satellite measurements. These instruments have been 
deployed and are currently in operation at twenty-six monitoring sites 
across the United States, including Hawaii. The researchers plan to 
have additional sites in Alaska, Puerto Rico, Oregon, North Carolina, 
and Oklahoma operational by the summer of 1999.
    Two grants to design and build advanced spectroradiometers have 
been awarded under the National Research Initiative Competitive Grants 
Program. These instruments are to be used in a research network to make 
precise measurements of the total UV-B spectra at selected sites. The 
first of these instruments failed to meet spectral performance 
standards when tested and calibrated by the National Institute of 
Science and Technology. An alternative design which resulted in a much 
larger and more difficult instrument to deploy has been developed. The 
first of two advanced instruments was deployed at Table Mountain near 
Boulder, Colorado during the fall of 1998. The second will be installed 
at Beltsville, Maryland during the spring of 1999.
    To gain experience in network operation, broadband instruments 
along with ancillary instruments were installed at ten sites and have 
been in operation for the last 52-60 months. These sites are now 
equipped with a full compliment of instruments including the new multi-
band instrument. Additional sites developed during the last 12 months 
are similarly equipped with broadband and the new multi-band UV 
instrument. Data from each site is transmitted daily to Colorado State 
University for preliminary analysis, distribution, and archiving. These 
data are available, within 24 hours of collection, on the Internet via 
a World Wide Web Site located in the Natural Resources Research 
Laboratory at Colorado State University. The Department of Agriculture 
is also a participant in the development of a central calibration 
facility at Department of Commerce facilities in Boulder, Colorado. The 
purpose of the central calibration facility is to ensure uniform and 
acceptable calibration and characterization of all instruments used in 
interagency UV-B monitoring programs.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1992, 
and the appropriation for fiscal years 1992-1993 was $2,000,000 per 
year; fiscal year 1994 was $1,175,000; fiscal year 1995 was $1,625,000; 
fiscal year 1996 was $1,615,000; fiscal year 1997 was $1,567,000; and 
fiscal years 1998 and 1999 was $1,000,000 per year. A total of 
$11,982,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $162,000 state appropriations in 1993; $183,106 state 
appropriations in 1994; and $285,430 provided by Colorado State 
University in 1995.
    Question. Where is this work being carried out?
    Answer. Colorado State University is managing the operating 
network, which when completed will include all regions of the country. 
At least 30 sites are planned for the climatological network including 
sites in Hawaii, Alaska, and Puerto Rico in order to provide broad 
geographic coverage. Ten sites have been operational with broad band 
instruments for up to five years and 26 sites are now operational with 
new generation instruments. The research level network began with the 
first instrument installed at the Table Mountain, Colorado instrument 
intercomparison site and the second to be installed at the Department 
of Agriculture Plant Stress Laboratory at Beltsville, Maryland. 
Negotiations are underway with the Department of Energy Solar Radiation 
site near Ponca City, Oklahoma as part of the Atmospheric Radiation 
Measurements field network as a potential site for the third instrument 
to be deployed later in 1999.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. As with other weather and climate observations, this 
network will be an ongoing need for the predictable future. These 
measurements will provide information on the nature and seriousness of 
UV-B radiation in the United States and will provide ground truth 
validation to other predictions of UV-B irradiance. The project has now 
met it's first objective of the establishment of a climatological 
network to monitor UV-B radiation at the surface of the earth. Years of 
operation will be required to measure trends in UV-B radiation and to 
develop models to predict the climatology of UV-B radiation.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency has assigned two technical staff to continuously 
monitor activities in the global change research program. A team of 
three experts in UV-B radiation measurement technology reviewed 
specifications for the development of the advanced spectroradiometers 
in July, 1996 prior to the procurement of major components of the 
instrument. A panel of radiation spectra scientists was brought in to 
review data derived from the new multi-band instruments in December, 
1996 to advise on the interpretation and analysis of data derived from 
these instruments. Agency staff is in contact with program management 
on a weekly basis and has visited the program headquarters six times 
during the last year. A review of the UV-B Monitoring Program by a 
panel of technical experts from outside the Department is planned for 
1999.
              global marketing support services, arkansas
    Question. Please provide a description of the research that has 
been done under the global marketing support services program.
    Answer. This grant supports the University of Arkansas Global 
Marketing Support Services program to provide research and service to 
agribusinesses. The objective of the university research is to identify 
potential foreign markets for Arkansas products and to conduct and 
disseminate foreign market assessment and evaluation studies to 
agribusiness firms. The research proposal received a merit review at 
the university prior to submission to CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes the emerging importance 
of global trade to the nation's economy and the reduction of trade 
barriers world-wide present unprecedented opportunities for cooperative 
public-private-university research to develop expertise in world 
markets.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to develop a university research and service 
organization to support international trade development activities by 
local area businesses. Research is conducted to determine the demand 
for specific Arkansas products in selected countries. In the past year, 
four export training workshops were held. Twelve Industry Opportunity 
Reports were completed and, as a result of these reports and one-on-one 
technical assistance, six firms entered the export market for the first 
time. Seven factsheets were completed and distributed and a peer-
reviewed publication on international joint ventures was published. An 
Internet website has been established to distribute information, and an 
Internet international market is being developed. Case studies of firms 
engaged in international market development are being developed as an 
educational tool. A new market analysis of Slovakia is underway.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $47,000; for fiscal years 
1995 through 1997, $92,000 per year; and for fiscal years 1998 and 
1999, $127,000 per year. A total of $577,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were $90,000 per year in State appropriations for 1994 through 1996; 
$51,700 for 1997; and $80,000 for 1998.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at the University of 
Arkansas, Fayetteville.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1994 was for a period of 12 
months, but the objective of expanding the export capacity of small to 
medium-sized agribusiness firms will not be met until 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES performed a merit review of the project in February 
1998, as it evaluated the 1998 proposal and determined that the 
``Global Marketing Support project provides leadership for a 
comprehensive program to integrate Arkansas into the global economy. It 
provides workshops, educational materials, technical assistance that 
help mostly small and moderate-size businesses understand and enter the 
export market. It provides market analyses and other research to back-
up its educational programs.''
                             grain sorghum
    Question. Please provide a description of the research that has 
been funded under the Grain Sorghum grant.
    Answer. This project was designed to improve the yield improvement 
of grain sorghum cultivars by developing early maturing hybrids with a 
longer grain filling period. The research focuses on identification of 
sorghum germplasm, which have a longer grain filling period or earlier 
maturation date. These traits may be used to shift more of the 
production to grain and less to vegetative growth, thus enabling more 
efficient use of the limited water supply. These funds are awarded to 
scientists working on sorghum at Kansas State University.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The focus of this research is toward the non-irrigated 
lands of Kansas where sorghum can produce a grain crop under conditions 
that would not be possible with corn and is, therefore, very important 
in the rotation with wheat. While the research is directed toward 
Kansas conditions, it would also apply to adjoining states. Germplasm 
research of national significance could potentially be supported by the 
competitive grants awarded under the National Research Initiative or 
the Initiative for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research is to identify germplasm 
and use it to develop grain sorghum cultivars that mature earlier and 
produce more grain. Initial studies have identified genetic 
characteristics controlling grain yield under a range of climatic 
conditions. Researchers have identified several sorghum lines, which 
have a grain-filling period as much as one-third longer than U.S. 
adapted parent lines. Analyses show that variability exists, the trait 
is genetically controlled, and incorporation into adapted germplasm can 
be accomplished. Simulation of expected production gains has been 
initiated.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1997 
and the appropriation for fiscal years 1997 through 1999 was $106,000 
per year for a total of $318,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In 1998, Kansas State provided support via salaries and 
associated fringe benefits of $31,852, associated indirect costs of 
$14,652, and in-kind costs of $45,580, for a total of $92,084.
    Question. Where is this work being carried out?
    Answer. These funds are awarded to Kansas State University, which 
allocates the money to Kansas State University scientists working on 
sorghum.
    Question. When was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objectives of this project, which began in 1997, are to 
develop sorghum parental lines with genetically longer grain fill 
duration and identify changes in management necessary to optimize grain 
production in these lines. Five years or more are required to 
accomplish the objectives. The first objective has been completed. The 
researchers expect to complete the next three original objectives by 
2004 and subsequent objectives by 2006. Preliminary results have 
contributed toward the understanding of factors controlling grain yield 
and the development of higher yielding sorghum cultivars for Kansas.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project is subjected to the institutional review and 
approval process, as well as review by a CSREES scientist. In addition, 
stakeholder input was obtained through formal and informal methods. The 
institutional review of the project confirmed that high priority issues 
of the sorghum industry in Kansas and other sorghum producing states 
were being addressed.
        grass seed cropping systems for sustainable agriculture
    Question. Please provide a description of the research that has 
been funded under the Grass Seed Cropping Systems for Sustainable 
Agriculture grant.
    Answer. This program was developed to provide management systems 
for sustainable grass seed production without field burning of the 
straw residue following harvest which results in adverse air quality 
problems. Grass seed yields are often significantly reduced the 
following season if the residue is not burned. The fiscal year 1999 
grant proposal has been requested.
    Funds from this grant are awarded competitively to scientists at 
Oregon State University, the University of Idaho, and Washington State 
University engaged in research on grass seed production. Each award is 
been passed a merit review by peer scientist.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that according to 
information provided by technical committees representing researchers 
and the grass seed industry, the need for this research is to develop 
sustainable systems of seed production that do not depend on field 
burning of straw residue. Much of the grass seed for the United States, 
including lawn grasses, is produced in the area. Field burning of straw 
residue creates unacceptable levels of air pollution and yields of some 
cultivar decline without burning.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal for this project is to develop grass seed 
production systems that do not depend on field burning of straw 
residue. To date, joint planning by state experiment station 
administrators and researchers from the three states with industry 
input have developed an integrated regional research effort to solve 
the problem.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $470,000, and for fiscal 
years 1995-1999, $423,000 each year. A total of $2,585,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal support for this project in fiscal year 
1994 was $266,055, $298,052 for fiscal year 1995, $282,053 in 1996, 
$301,650 in 1997, and 310,700 in 1998.
    Question. Where is this work being carried out?
    Answer. The research will be conducted by the three state 
agricultural experiment stations in Idaho, Oregon, and Washington.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Completion of the initial objectives was anticipated to 
take five years and, therefore, should be completed in 1999. Revised 
goals leading to application of new management systems will require 
additional time.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The entire project is reviewed annually by a steering 
committee for focus and relevance. The combined proposal is reviewed by 
CSREES before funds are awarded.
    Considerable progress has been made toward identifying the 
consequences of phased out field burning of straw residue on grass seed 
production. Current and future effort are directed toward development 
of sustainable systems without field burning. This program is subject 
to annual comprehensive evaluation by a team of peer scientist, 
industry representatives, and farmers. The results are used to guide 
research for the next year. Each proposal is subjected to the 
institution project approval process and reviewed by the CSREES 
National Program Leader.
                         human nutrition, iowa
    Question. Please provide a description of the work that has been 
funded under the Human Nutrition, Iowa grant.
    Answer. This research aims to develop animal and plant foods with 
nutritionally-optimal fat content and to improve utilization of foods 
containing non-nutrient health protectants, components that may reduce 
health risks. The research includes human and animal nutrient 
utilization, consumer food choices, and economic impacts of designed 
food to support optimal nutrition. The fiscal year 1998 grant supports 
research efforts of 35 investigators from six disciplines through June 
1999. CSREES requested that the university submit a grant proposal for 
fiscal year 1999 which is now under CSREES merit review.
    Question. Cipal researcher, what is the national, regional or local 
need for this research?
    Answer. The research addresses food quality, nutrition, and optimal 
health. Much of the research focuses on improving the nutritional 
quality of foods important to the economy of the Midwest, while making 
those improvements economically feasible. Ongoing research focuses on 
increasing health protective lipids and plant chemicals in human foods. 
Such foods have recently been called functional foods and the 
development of functional foods is of high priority to the food 
industry.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the Center for Designing Foods to Improve 
Nutrition, the administrative unit for this grant, is to improve human 
nutrition and health maintenance by determining how to improve animal 
and plant food fat content and how to increase availability of health-
protectant factors in the human food supply. The research includes food 
production, processing, consumer choices, biological utilization, and 
economic impacts.
    The researchers have developed milk, eggs, and pork enriched in the 
fatty acid called conjugated linoleic acid. This compound has unique 
cancer preventive properties derived from animal fats. Studies suggest 
that pork enriched with conjugated linoleic acid may be highly 
acceptable to consumers. Several studies have demonstrated the 
modifying key enzymes that are important for lipid synthesis in plants 
impact oil accumulation in the seeds. The Center's research group on 
soybean health effects assessed the ability of soybean isoflavones 
during menopause to maintain bone density and reduce menopausal 
symptoms. They found that soybean isolate with isoflavones reduced bone 
loss in postmenopausal women. Several studies have demonstrated that 
research with cultured cells showed that oxidants can cause damage to a 
gene that is important in the development of many cancers and that 
antioxidants, including glutathione, may be able to prevent this 
damage. Additional research was aimed at identification and 
characterization of novel iron compounds from milk that will improve 
iron absorption and utilization. Researchers observed that low 
molecular weight proteins found in human milk are responsible for high 
iron bioavailability.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
with an appropriation of $300,000. The fiscal years 1992-1993 
appropriation was $500,000 per year; $470,000 in fiscal year 1994; 
$473,000 per year in fiscal years 1995 through 1999. A total of 
$4,135,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $293,000 university, $312,869 industry, and $14,000 
miscellaneous in 1991; $90,000 state appropriations, $473,608 
university, $131,160 industry, and $116,560 miscellaneous in 1992; 
$307,500 state appropriations, $472,081 university, and $222,267 
industry in 1993; $486,000 university and $254,000 private in 1994; 
$210,000 university and $200,000 private in 1995; $613,770 university 
and $207,811 private in 1996; $690,736 university and $458,000 private 
in 1997; and $502,124 university and $700,000 private in 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the Center for Designing 
Foods to Improve Nutrition, Iowa State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original overall objective to design foods to improve 
nutrition is continuing to be addressed. A new set of related 
objectives will be completed in 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The grant proposals for fiscal years 1998 and 1999 have 
undergone extensive scientific peer review by the grantee. Progress and 
objectives will be further reviewed by the Center's newly formed 
External Advisory Council.
                       human nutrition, louisiana
    Question. Please provide a description of the work that has been 
funded under the Human Nutrition, Louisiana grant.
    Answer. Obesity is a growing problem in the United States and world 
wide. This grant entitled, Dietary Fat and Obesity, will help answer 
three issues about this important problem. First, is there a mechanism 
for tasting fat which can be used to reduce its preference? Second, 
does exercise enhance the ability to use fat? And third, are there 
genetic factors which can influence the response to dietary fats? The 
fiscal year 1998 grant supports research through July 2000. The 
University has submitted a revised comprehensive proposal for fiscal 
year 1999.
    Question. According to the principal researcher, what is the 
national, regional or local need for this research?
    Answer. Obesity is an epidemic in the United States and the role of 
dietary fat as a cause of this epidemic is hotly debated. This grant is 
currently supporting a project which is studying the preventive effects 
of a sugar and soybean oil commodity-derived fat substitute on the 
development of obesity and associated problems. It is also partly 
funded by industry.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The overall goal of this grant is to identify the basis for 
the susceptibility to obesity of some people who eat high fat diets and 
to understand how they differ from those people who are resistant to 
becoming obese when eating a high fat diet. The researchers have 
identified that some people can taste selected polyunsaturated fatty 
acids but others cannot. The relation of this taste to other tastes, 
and its influence on food preferences are the current line of study in 
this project. In a second project, they have shown marked differences 
between individuals in their response to an increase in dietary fat 
intake. When exercise is added, the adaptation to a high fat diet is 
much more rapid, suggesting the importance for public policy of 
increasing efforts to encourage Americans to become more active. In a 
third project they found that the dietary intakes of total fat, 
saturated and monounsaturated fats were associated with insulin 
resistance. A single circulating fatty acid--20 carbons long with three 
cis double bonds--was the strongest independent predicator of fasting 
insulin. Surprisingly, and contrary to this hypothesis, trans fatty 
acids in the serum were not markers of insulin resistance.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
and the appropriation for fiscal years 1991-1993 was $800,000 per year; 
for fiscal years 1994-1999 was $752,000 per year. A total of $6,912,000 
has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $523,100 state appropriations in 1991; $515,100 state 
appropriations and $2,216,606 private in 1992; $536,100 state 
appropriations and $940,000 private in 1993; $627,000 state 
appropriations and $3,775,000 private in 1994; $546,100 state 
appropriations and $3,100,000 private in 1995; $1,471,000 state 
appropriations and $2,488,000 private in 1996; $1,998,000 state 
appropriations and $2,104,000 private in 1997; and $987,000 state 
appropriations and $1,892,000 private in 1998.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at the Pennington Biomedical 
Research Center, Louisiana State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is fiscal 2000. The objectives to be completed over the remaining time 
of the grant will be reviewed by an external advisory team.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. In March 1999 an on-site panel of researchers evaluated the 
proposed objectives and experimental protocols. On the basis of the 
critiques from the reviewers, the proposal for fiscal year 1999 was 
revised. Another review will be conducted in March 1999, allowing for 
implementation of the research projects to fulfill these objectives.
                       human nutrition, new york
    Question. Please provide a description of the work that has been 
funded under the Human Nutrition, New York grant.
    Answer. The focus of this work remained unchanged during the last 
fiscal year. The general objective was improving the knowledge base 
needed to evaluate and, when appropriate, implement the increased 
reliance on plant-based foods that is at the core of current Federal 
dietary guidelines. Current dietary guidelines use this approach as a 
principal strategy to control energy consumption, reduce fat intake, 
modify the composition of ingested lipids, enhance the consumption of 
foods associated with reduced cancer risk, and simultaneously insure 
that macro-and micronutrient needs are met. The grant has brought 
together investigators whose expertise ranges from basic nutritional 
molecular biology to the behavioral sciences that are key in enabling 
consumers to adopt newly discovered knowledge easily and effectively. 
The fiscal year 1998 grant supports research through September 1999.
    CSREES has requested that the university submit a comprehensive 
grant proposal for the next grant period. The university plans to 
change the focus to basic, human, and social science food and nutrition 
issues that complement the university's initiative in genomics. 
Opportunities exist on those aspects of mammalian and plant genomics 
that relate most directly to dietary guidelines and to the 
international acceptance of genetically-engineered foods.
    Question. According to the principal researcher, what is the 
national, regional or local need for this research?
    Answer. Inappropriate diets and physical activity patterns are the 
second leading etiology of preventable morbidity and mortality in this 
country. As greater emphasis is given to strategies that permit 
individuals to take increasing responsibility for their health and 
identify genetic and environmental risk factors, the knowledge gained 
by research sponsored by this grant becomes increasingly valuable. This 
knowledge is used by consumers in making informed food choices, by food 
producers and processors in anticipating consumer demands, and by 
public health professionals in designing health promotion and disease 
prevention strategies.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The newly revised dietary guidelines reemphasize expected 
health benefits from the increased consumption of fruits, vegetables, 
and grain products. As pointed out in the response to the first 
question, investigations are carried out at the molecular, behavioral 
and community levels.
    Changes in fat levels and composition of the American diet are 
expected to alter lipid metabolism. Lipoprotein lipase is a pivotal 
enzyme that regulates lipid metabolism. A novel technique to tag an 
immunologically portion of the enzyme was developed. The researchers 
expect that this will enable the identification of key domains of this 
enzyme and thus lead to a better understanding of the handling of 
dietary fat. Other work focusing on fat led to the development of the 
first system for high precision analysis of stable isotope ratios from 
organic compounds separated by gas chromatography. This methodology has 
led to improved detection of lipid metabolites in human blood.
    Scientific and public health understanding of the role of preformed 
vitamin A and its precursors in health has grown markedly in the last 
few years. Researchers discovered a novel regulatory mechanism of one 
of the nuclear receptors that is responsive to vitamin A or its 
metabolites. Related work has led to the development of methodology to 
assess the vitamin A content of plant foods and better methods for 
assessing the absorption and conversion of vitamin A precursors to 
active metabolites.
    Selenium's role in the prevention of selected cancers is receiving 
national attention. Forty accessions from the brassica collection in 
Plant Genetic Resources Laboratory were raised under field and 
greenhouse conditions. A ten-fold range in selenium content was 
discovered which was related to the sulfur content, but not the total 
protein content of the material. It is expected that this work will 
enhance future plant breeding techniques that have enhanced nutritional 
outcome as a major goal.
    The university's community work included an assessment of the 
opportunities and constraints for increasing plant food consumption in 
five counties with findings indicating the need for closer links 
between producers and consumers. This led to a descriptive analysis 
which documented the major features of a county area that contains a 
metropolitan concentration surrounded with highly productive and varied 
agriculture production. In a separate effort, a community decision-
making approach for improving food and nutrition was developed and 
subsequently implemented in six counties. A university community 
partnership model for integrating nutrition research and intervention 
was also developed and tested by community stakeholders.
    In addition, researchers completed studies on the consumption of 
low-fat foods by children. Detailed food records of children attending 
day-care centers were collected. They observed that the majority of the 
children's calories were consumed in the centers, the majority of 
calories were consumed from snacks, and that carbohydrates were the 
major determinant of total caloric intake. In another study dietary 
risk factors among Hispanic/Latino families were assessed in a sample 
of 575 households. Major findings suggested that consumption of 
calories from saturated fat and the degree of obesity were 
significantly higher among migrant Hispanic women compared to non-
migrants.
    Question. How long has this work been underway, and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $450,000; fiscal years 1990-1991, $556,000 
per year; fiscal years 1992-1993, $735,000 per year; fiscal year 1994, 
$691,000; fiscal years 1995-1999, $622,000 each year. A total of 
$6,833,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $154,056 state appropriations and $2,456 private in 
1991; $238,430 state appropriations and $60,746 private in 1992; 
$19,401 state appropriations and $22,083 private in 1993; $202,441 
state appropriations and $1,175 private in 1994; $296,794 state 
appropriations in 1995; $348,127 in state appropriations and $39,593 
private in 1996; $133,162 state appropriations in 1997; and $8,185 
university appropriations, $166,752 state appropriations, and $7,905 
private in 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Cornell University, New 
York.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original overall objective to integrate nutrition goals 
and food systems is continuing to be addressed. A set of new related 
objectives was submitted in 1997 and will be the research focus through 
1999. The university plans to change the focus to basic, human and 
social science food and nutrition issues that complement the 
university's initiative in genomics.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The grant proposal for fiscal year 1997 was subjected to 
extensive peer review, and the recommendations were incorporated into 
the ensuing experimental designs.
                    hydroponic tomato production, oh
    Question. Please provide a description of the research that has 
been funded under the Hydroponic Tomato Production, OH grant.
    Answer. CSREES has requested the university to submit a grant 
proposal that has been not yet been received. Cultural practices, 
greenhouse design, and economics will be evaluated for the areas. 
Tomato production will be evaluated as an alternative enterprise.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The research is needed to develop and evaluate management 
protocols for economical production of greenhouse tomatoes as an 
alternative crop for that area.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals of the research is to provide 
recommendations for management systems for successful operation of 
greenhouse tomatoes as an alterative crop.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
and the appropriation for fiscal year 1998 was $140,000, and for fiscal 
year 1999 is $200,000. A total of $340,000, has been appropriated.
    Question. What is the source and amount of non-federal provided by 
fiscal year?
    Answer. The non-federal funds provided for support of the project 
are from State funds totaling $19,400 for fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. The research will be conducted by the Ohio State 
Agricultural Experiment Station at selected locations in Ohio.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigator for this project anticipates 
completion of the original objectives in fiscal year 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project was subjected to a peer review in the 
institution and again reviewed by the CSREES National Program Leader 
when initiated in 1998.
              illinois-missouri alliance for biotechnology
    Question. Please provide a description of the research that has 
been funded under the Illinois-Missouri Alliance grant.
    Answer. The Illinois-Missouri Alliance has initiated a competitive 
grants program in agricultural biotechnology for research in targeted 
priority areas of need related to corn and soybeans. The scope of 
interest includes production, processing, marketing, utilization, 
inputs, and support services, along with economic, social, 
environmental, and natural resource concerns. The Alliance has 
solicited research project proposals from scientists at Illinois and 
Missouri and other midwestern institutions, and has conducted peer 
reviews for science quality, commercial feasibility and potential 
economic impact to select the proposals that will be funded. In 1998 
the Alliance awarded four research grants at four institutions totaling 
$1,013,000.
    In 1998 the Alliance also started an on-line magazine called 
AgBioForum devoted to the economics and management of agricultural 
biotechnology. The purpose of AgBioForum is to provide unbiased timely 
information and new ideas leading to socially-responsible and 
economically-efficient decisions in science, public policy, and private 
strategies pertaining to agricultural biotechnology. In its first four 
months, AgBioForum experienced over 23,000 hits from individuals in 
universities, industry, government, and international organizations.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal investigator has indicated that the goal of 
the Alliance is the pre-commercial development of emerging 
biotechnology discoveries for agriculture. The midwestern region 
produces more than half of the nation's output of corn and soybean 
crops, and is critical to domestic food security and United States 
competitiveness in global agricultural markets. Alliance grants are 
awarded on a regional basis to advance corn and soybean production in 
the Midwest. The Alliance is implementing a research strategy that it 
hopes will generate important biotechnological developments that are 
rapidly adaptable to unique local soil, climatic, and socioeconomic 
conditions of the region. Alliance grants are awarded to projects with 
a clearly defined marketable product or service derived from 
biotechnology research. Biotechnology research of national significance 
could potentially be supported by competitive grants awarded under the 
National Research Initiative or the Initiative for Future Food and 
Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. fiscal year 1998 was the fourth year of funding for the 
Alliance. The research program focuses on the two major commodity 
crops, corn and soybeans, as produced, processed, and marketed in the 
midwest. The goal of this biotechnology program is to fund integrated 
research and development projects that will lead to specifically-
defined practical technologies for commercialization. The projects 
funded in fiscal year 1998 include efforts to: (1) engineer maize to 
produce genistein, a possible anti-cancer agent, (2) detect and select 
superior resistance to soybean sudden death syndrome, (3) isolation of 
specialized seed-forming genes in grassy relatives of maize, and (4) 
development of high oil maize hybrids.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through 1999?
    Answer. The work supported by this grant began in fiscal year 1995. 
The appropriations for fiscal years 1995 and 1996 were $1,357,000 each 
year, for fiscal year 1997, $1,316,000, and for fiscal years 1998 and 
1999, $1,184,000 per year, bringing the total appropriations to date to 
$6,398,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The Alliance has not specified a required amount of 
matching funds, but it is expected that most projects will have 
commitments for significant direct and in-kind non-federal support. 
Since Alliance projects are still underway, the exact amount of the 
non-federal contribution is still unknown. The non-federal contribution 
is expected to be substantial, and a system for accounting for future 
non-federal contributions is in place.
    Question. Where is this work being carried out?
    Answer. The research projects identified for funding in fiscal 
years 1995 through 1998 are being conducted at the University of 
Illinois, the University of Missouri, Iowa State University, 
Northwestern University, Southern Illinois University, and the 
Agricultural Research Service.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Each project proposal for Alliance funding has a target 
date for completion. The four initial projects were three-year studies 
with anticipated completions at the end of fiscal year 1998. Most of 
the second and third rounds of projects are also three-year studies 
with anticipated completions at the end of fiscal years 1999 and 2000, 
respectively.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Illinois-Missouri Biotechnology Alliance was evaluated 
for scientific merit by an agency peer review panel on January 29, 
1998. The panel recommended approval of the project pending receipt of 
supplemental information on administrative aspects of the project. The 
supplemental information was received, and we are satisfied that the 
program is being administered in compliance with the purpose of the 
grant. A peer review panel of scientists was scheduled to re-evaluate 
the project for scientific merit on February 9, 1999.
           improved dairy management practices, pennsylvania
    Question. Please provide a description of the research that has 
been funded under the Improved Dairy Management Practices grant.
    Answer. The research focuses on developing methods to help dairy 
farmers in the adoption of new technology and management practices 
which lead to improved dairy farm profitability. Individual research 
projects funded by the grant are determined by a competitive peer 
review process administered by the Institution using peers from other 
Institutions located primarily in other States.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the local need is the 
identification and implementation of profit enhancing management 
strategies for Pennsylvania dairy farms in response to changing market 
conditions and emerging technologies. The current focus is to develop 
economically-viable solutions to issues confronting Pennsylvania dairy 
farmers such as dealing with animal waste in an environmentally-
friendly manner, reducing the cost of forage production systems, 
including grazing systems, and to develop a better understanding of 
decision processes by dairy farmers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research remains the same, which 
is the development of methods to help dairy farmers in the adoption of 
new technology and management practices which lead to improved dairy 
farm profitability. A farm management survey is complete and analysis 
of results is in progress. Farm financial models have been developed 
and are undergoing field tests on selected farms. Workshops to teach 
elements of business management to dairy farmers have been conducted, 
and survey instruments are in place to monitor effectiveness of 
workshops. Research is currently underway to develop improved models 
for nutrient management on northeastern dairy farms, to evaluate the 
potential role of intensive grazing systems to replace harvested 
forage, and to better understand how decisions are made by dairy farm 
families. Refinements of an expert computer based system to assist 
dairy farmers in controlling the udder disease, mastitis, is underway. 
A study to evaluate the induction of lactation on dairy profitability 
is underway. An additional study to evaluate the impact of improved 
protein nutrition during late gestation on dairy cow performance has 
been initiated.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1992 
and the appropriation for fiscal years 1992 and 1993 was $335,000 per 
year. The fiscal year 1994 appropriation was $329,000 and $296,000 each 
year in fiscal years 1995-1999. A total of $2,479,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. During fiscal year 1992, $354,917 were from State funds, 
and $16,000 from Industry, for a total of $370,417. During fiscal year 
1993, $360,374 were from State funds and $16,000 from Industry for a 
total of $376,374. Information is not available for fiscal years 1994-
1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Pennsylvania State 
University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal researcher anticipated completion of the 
original objectives by March, 1994. The original objectives were met. 
Availability of continued funding has permitted the institution to 
develop a competitively awarded grant program within the institution to 
address priority issues related to management of dairy farms. Proposals 
are reviewed and ranked by peers in other institutions prior to award. 
It is anticipated that awards from the fiscal year 1999 appropriation 
will be complete in September, 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency accepts technical review of specific proposals 
funded by this grant on an annual basis. The overall proposal is review 
by the agency on an annual basis. In addition, technical staff has 
conducted on-site review of the program in 1993 and in 1995. The 
overall objectives of the work funded by this grant has direct 
relationship to the development of Integrated Management System as well 
as to aspects of animal production systems on animal well-being and 
impact on the environment.
                   improved fruit practices, michigan
    Question. Please provide a description of the work that has been 
done under the improved fruit practices grant.
    Answer. The request for proposal for fiscal year 1999 has been 
issued. Funds from this grant will be awarded competitively to 
scientists at Michigan State University working with these crops. This 
research will involve a multidisciplinary approach to reduce chemical 
use on apple, blueberry, and sour cherry, three important Michigan 
fruit crops, and improve the management of dry edible beans and sugar 
beets. Research will be conducted on crop management techniques and 
reduced chemical use.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes Michigan's need for this 
research is to develop and maintain/expand their tree fruit and small 
fruits industry. There is a need to improve the culture and management 
of dry edible beans and sugar beets.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The planned objectives of the research are to reduce the 
chemical contamination of the environment from fruit production and 
improve production practices for beans and beets through 
multidisciplinary research, including pesticides, and the development 
of new nonchemical production methods.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $494,000, and for fiscal 
years 1995-1999, $445,000 each year. A total of $2,719,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
in fiscal year 1994 were $437,338 from state appropriations and 
$135,000 from industry, for fiscal year 1995 were $574,494 from state 
appropriations and $127,000 from industry, and a total of $908,969 for 
1996. The non-federal funds for 1997 totaled $752,500. The non-federal 
funds for 1998 total $729,145.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Michigan State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Principal Investigators have reported significant 
progress toward improved cultural practices for these speciality crops 
which is expected to reduce the need for chemical pesticides, and 
expect to complete the original objective by the end of fiscal year 
1999. Long-term goals are expected to take an additional five years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project has not been subjected to a comprehensive 
review. The annual proposals including all of its sub projects are 
subjected to peer review before submission to CSREES before they are 
approved. The project has progress toward the objective of developing 
management practices and strategies for economical production of 
specialty crops in Michigan with reduced chemical pesticide use. This 
program is evaluated at the end of each research cycle and priorities 
adjusted for the next years funding. The evaluation is performed by 
scientists at Michigan State University.
                 infectious disease research, colorado
    Question. Please provide a description of the research that has 
been conducted under the Infectious Disease Research, Colorado grant.
    Answer. This center will be focused on the development of a 
multidisciplinary structure to address such diseases and disseminate 
critical information on trade issues. The Center will utilize a network 
of related research and services programs at collaborating universities 
and state and Federal agencies. All activities will be reviewed and 
evaluated by an interdisciplinary group which will include scientists 
and livestock commodity representatives. Finally, a core laboratory 
facility will be established to provide diagnostic support of the 
program.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for the 
research?
    Answer. The need for this research is to provide valid risk 
assessment models for diseases which affect international trade and 
animal and public health. Livestock producers and the industry need 
this type of information to enable them to make correct disease 
management decisions.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to establish a regional center that will foster 
interactive work on risk assessment, disease control, and minimize the 
economic impact of disease outbreaks in livestock.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant will begin in fiscal year 
1999 and the appropriation for fiscal year 1999 is $250,000.
    Question. What is the source and amount of non-federal funds by 
fiscal year?
    Answer. Currently there is no information on non-federal 
contributions to the project.
    Question. Where is this work being performed?
    Answer. The research will be conducted at the College of Veterinary 
Medicine, Colorado State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date is 2003.
    Question. When was the last agency evaluation of this project? 
Provide a summary of it.
    Answer. Because the project is just being initiated, no evaluation 
has been done.
          institute for food science and engineering, arkansas
    Question. Please provide a description of the research that has 
been funded under the Institute for Food Science and Engineering grant.
    Answer. As the flagship center for the Institute of Food Science 
and Engineering, the Center for Food Processing and Engineering has as 
its objectives to facilitate and encourage value-added research and 
improve the processing of agricultural products. The Center requires 
researchers to obtain matching funds from industry to support their 
research. Research projects have been funded by 39 different companies 
from 17 states and 4 countries. The next request for proposals to the 
Institute will be issued in February 1999. The Center for Food Safety 
and Quality, with a mission to conduct research on the safety and 
quality of foods relative to microbiological and chemical hazards, was 
activated on January 1, 1997. Center researchers are presently 
receiving funding through the Food Safety Consortium. The Institute has 
also received funding from the United Nations Food and Agriculture 
Organization to establish a Center of Excellence for Food Quality and 
Safety. fiscal year 1998 funds are supporting research from March 1, 
1998, through February 28, 1999. CSREES has requested, but not yet 
received, a proposal in support of the fiscal year 1999 appropriation.
    Question. According to the research proposal, or the principal, or 
the principal researcher, what is the national, regional or local need 
for this research?
    Answer. The principal researcher believes the Institute will 
provide technical support and expertise to small and mid-sized food 
processors that usually do not possess adequate expertise in-house. The 
economy of the southern region will be improved through the creation of 
new jobs and a high multiplier effect from the research. The Institute 
will develop and disseminate scientific information and provide 
educational programs related to value-added further processing, 
storage, and marketing of food products. These efforts will assure food 
safety, improve the sensory and nutritional quality of food, and meet 
the nutritional requirements and food preferences of a changing 
society. Value added research of national significance could 
potentially be supported by competitive grants awarded under the 
Initiative for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research is to establish an 
Institute of Food Science and Engineering at the University of 
Arkansas-Fayetteville. The Institute for Food Science and Engineering 
and the Center for Food Processing and Engineering are operating. 
Research projects at the Center include: postharvest management 
practices for rice, such as studies of physicochemical properties, 
bacterial load of rice products, and milling systems, and development 
of methods to improve the texture and dill flavor of pickles, and the 
color of acidified pickled vegetables, with estimated impact to the 
pickle industry of $500,000 annually. Researchers have developed 12 
mechanized systems for total vineyard mechanization which maintain or 
improve juice and wine quality. Research on physicochemical properties 
of potatoes and bitterness in carrots and have had estimated economic 
impacts of several million dollars. Research on elecrochemical flow-
through systems for chicken processing water and near infrared, mid-
infrared imaging for large scale fruit processing have important 
applications in industry. Institute staff, including the Descriptive 
Sensory Panel, have assisted both national food processing companies 
and small commercial kitchens in process development, with an impact of 
up to 2,000,000 annually on the Arkansas vegetable processing industry. 
The Institute's FAO Center of Excellence presents workshops in the 
United States as well as planning train the trainer courses in Mexico 
and Central America to improve the safety of imported fresh fruit and 
vegetables. To date, 70 publications, two IMPACT reports, and a 
quarterly newsletter have served to keep the industry and fellow 
scientists informed of research and technology transfer activities.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1996. 
The appropriation for fiscal years 1996 and 1997 was $750,000 each 
year, $950,000 for fiscal year 1998, and $1,250,000 for fiscal year 
1999. A total of $3,700,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
include $184,700 in state funds and $93,000 from industry in fiscal 
year 1996, and $187,357 in state funds and $320,403 in industry funds 
in fiscal year 1997. Thus far in fiscal year 1998, industry has 
provided $93,599, with firm commitments of an additional $55,000. The 
state has also provided facilities and administrative and clerical 
support estimated at $303,694 through June 30, 1998. The Institute has 
also received $48,000 to establish the FAO Center of Excellence.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at the University of Arkansas at 
Fayetteville.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal researcher anticipates that work will be 
completed on the original goals in fiscal year 2002. The goals of this 
project related to establishing the centers of the Institute have not 
been fully met. The Center for Food Processing and Engineering and the 
Center for Food Safety and Quality are in operation; activation of the 
Center for Human Nutrition is scheduled for 1999. The objectives 
related to research and service to industry, food entrepreneurs, and 
the general public would continue to be ongoing.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
In a review of the proposal on January 8, 1998, the assessment was that 
satisfactory progress was demonstrated in meeting the goals of the 
Institute.
                       integrated pest management
    Question. Please provide a description of the research that has 
been funded under the Integrated Pest Management special grant.
    Answer. This special research grant develops new pest management 
tools to address critical pest problems identified by farmers and 
others in a crop production region. Funds are distributed though the 
Regional Integrated Pest Management--IPM--Grants Program, which 
provides competitively awarded grants to develop new pest management 
tactics to replace management tools lost to the Food Quality Protection 
Act--FQPA--issues, validate the effectiveness of new tactics in a 
production setting, and help producers implement these tactics by 
providing educational training programs. Proposals submitted to the 
Regional IPM Grants program undergo technical and merit review at the 
regional levels.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The ability of the Nation's agricultural production system 
to keep pace with domestic and global demand for food and fiber is 
dependant on access to safe, profitable, and reliable pest management 
systems. For a variety of reasons, many of the chemical control 
alternatives that farmers and other pest managers have relied on for 
many years are no longer available. The loss of these important tools 
is likely to continue at an accelerated rate over the next several 
years. The FQPA will have significant impacts on pest management 
systems in the United States over the next decade, and the ``minor 
use''--high value crops grown on relatively few acres--will be 
particularly hard hit. Regulatory decisions under FQPA are focused on 
organophosphate insecticides, which are widely used tools in IPM and 
Resistance Management programs. For these reasons and others, it is 
essential that farmers be provided with new pest management tools and 
better information so they can remain competitive in today's global 
marketplace. These special IPM research grant funds address important 
issues via a request for proposals distributed to applied agricultural 
scientists throughout the United States. This request for proposals 
focuses on the development and testing of practical alternatives for 
IPM and Resistance Management Systems to replace organophosphate 
insecticides which likely will be lost due to FQPA.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is to provide farmers with new 
pest management options that allow them to reduce dependence on 
chemical pesticides, improve their profitability, and protect vital 
natural resources. The research supported by this special grant has 
made an important contribution to increasing knowledge about new 
approaches to pest management, but the need for continued investment in 
this area of research is greater than ever.
    Question. How long has this work been underway and how much as been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1981, $1,500,000; fiscal years 1982 through 1985, 
$3,091,000 per year; fiscal years 1986 through 1989, $2,940,000; fiscal 
year 1990, $2,903,000; fiscal year 1991, $4,000,000; fiscal years 1992 
and 1993, $4,457,000 per year, fiscal year 1994, $3,034,000; and fiscal 
years 1995-1999, $2,731,000 each year. A total of $58,130,000 has been 
appropriated since fiscal year 1981.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. A study of the sources of non-federal funds which 
contribute to this research effort was conducted in 1993 and 1994 and 
the results are as follows. In fiscal year 1993, state appropriations, 
$841,017, product sales, $33,987, industry grants, $17,081, and other, 
$31,737, which totaled $923,822. For fiscal year 1994, state 
appropriations, $2,303,458, product sales, $77,157, industry grants, 
$210,110, and other, $216,552 which totaled $2,807,277. These studies, 
which have not been repeated since 1994, have demonstrated a trend 
toward greater annual state investments in Integrated Pest Management 
research.
    Question. Where is the work being carried out?
    Answer. Scientists in all states are eligible to compete for this 
funding on a competitive basis. This research is currently being 
carried out by State Agricultural Experiment Stations in more than 40 
states.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Due to the passage of FQPA in 1996, the economic and 
environmental pressures facing U.S. agriculture today are greater than 
they were in 1981 when Federal funds were first appropriated for this 
special research grant. It is important for government to address 
agricultural producers' needs by participation in the development and 
implementation of new approaches to pest management with the emergence 
or introduction of new pests, as existing pests become resistant to 
current control methods, as new pesticide regulations are implemented, 
and as national and international markets shift.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Evaluation of this project is a continuous process. 
Projects funded by this research grant are awarded through a 
competitive process that includes relevance, technical, and merit 
reviews by multi-disciplinary panels of peers. Progress reports are 
reviewed to evaluate accomplishments, and special scrutiny and interest 
is given to studies involving new control strategies relating to at-
risk sites with pest management usage patterns impacted by FQPA 
implementation.
                integrated production systems, oklahoma
    Question. Please provide a description of the research that has 
been funded under the Integrated Production Systems, Oklahoma grant.
    Answer. This grant focuses on the development of efficient 
management systems for production of watermelons and blackberries under 
intensively-managed conditions. The work will address biotic and 
abiotic production components under Southeastern Oklahoma conditions 
for use in production guidelines. This will include planting densities, 
fertilizer studies, weed management and insect and disease control. The 
request for the fiscal year 1999 proposal has been issued, the grant 
will be competitively awarded to scientists working at the West Watkins 
Agricultural Research Center--WWAR--based on a merit review conducted 
by Oklahoma State University personnel.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for the 
research.
    Answer. The principal researcher believes the need for this 
research is focused on the local area of Southeastern Oklahoma, an area 
that is economically-depressed and in need of alternative crops to 
diversify the dominant cow/calf livestock production.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to develop new and 
alternative crops to supplement and diversify the cow/calf livestock 
agriculture of Southeastern Oklahoma with emphasis on horticultural 
crops. Work to date has shown promise for strawberries, blackberries, 
cabbage, melons, and blueberries. CD-ROM technology transfer to 
research results to support an expert system will be developed for 
grower use.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Work supported by this grant started in fiscal year 1984 
and the appropriations were: fiscal year 1984, $200,000; fiscal year 
1985, $250,000; fiscal year 1986, $238,000; fiscal years 1987-1989, 
$188,000 per year; fiscal years 1990-1991, $186,000 per year; fiscal 
year 1992, $193,000; fiscal year 1993, $190,000; fiscal year 1994, 
$179,000; fiscal years 1995-1998, $161,000 each year; and fiscal year 
1999, $180,000. A total of $3,010,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year through fiscal year 1999?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $165,989 state appropriations in 1991; $160,421 state 
appropriations in 1992; and $164,278 state appropriations in 1993. Non-
federal support for 1994 was $141,850 for state appropriations. Funds 
for fiscal year 1995 were $129,552; for 1996, $146,000; for 1997, 
$152,000; and for 1998, $148,000.
    Question. Where is this work being carried out?
    Answer. This research is being done at the West Watkins 
Agricultural Research and Extension Center at Lane, Oklahoma, a branch 
of the Oklahoma State Agricultural Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives of this project were to develop 
production systems for alternative crops with economic potential for 
southeastern Oklahoma. Each year's funding cycle has addressed specific 
crop and management objectives to be completed over two years time. 
These short term objectives have been met for each of the completed two 
year projects. However the original objective of developing alternative 
cropping systems is very long term and have not been completed.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Each of the annual project proposals has been put through 
the institutions review and is reviewed by a CSREES scientist before 
approval. In addition to the annual review of individual proposals, a 
comprehensive review of the Lane Agricultural Center, where this 
research is conducted, was conducted in 1993. This review reviled that 
work supported by this grant is central to the mission of that station 
and represents an important contribution to the agriculture of the 
area. This work has provided practical management information for 
farmers of southeastern Oklahoma that has improved their ability to 
economically-produce small fruit and vegetable crops. This project is 
evaluated internally at the end of each year in order to set priorities 
for the next year.
international agricultural market structures and institutions, kentucky
    Question. Please provide a description of the research that has 
been done under the international agricultural market structures and 
institutions program.
    Answer. This is a new project and the University of Kentucky is 
submitting its first grant proposal in fiscal year 1999. The research 
will identify a variety of market factors that affect the success of 
American firms in international agricultural markets, estimate the 
impact of such factors, and make recommendations to policy makers and 
business firms.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. U.S. firms need to become more aggressive in international 
markets, but these markets are unfamiliar to many firms. The structure 
of international markets and the institutions that serve them are often 
different than in domestic markets. Furthermore, the structures and 
institutions are continuously changing.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to increase the international marketing success 
of American farmers and agribusinesses by increasing their 
understanding of how international markets work.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by the grant begins in fiscal year 1999 
and the appropriation is $250,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal matching funds and sources will be 
identified in the grant proposal when it is completed.
    Question. Where is this work being carried out?
    Answer. The work will be carried out at University of Kentucky in 
Lexington.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objectives and duration of the project will be 
specified in the grant proposal.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This is a new project. CSREES will carefully review the 
proposal when it is received.
                  international arid lands consortium
    Question. Please provide a description of the research that has 
been funded under the International Arid Lands consortium.
    Answer. fiscal year 1998 was the fifth year that Cooperative State 
Research, Education, and Extension Service funded the International 
Arid Lands Consortium. The Forest Service supported the program during 
fiscal year 1993 to develop an ecological approach to multiple-use 
management and sustainable use of arid and semi-arid lands. Projects 
that began in 1994-1997 will continue to be funded to address issues of 
land reclamation, land use, water resources development and 
conservation, water quality, and inventory technology and remote 
sensing. All proposals are peer reviewed and awarded competitively, 
whereby the principal investigator must be from a Consortium member 
institution.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the consortium is devoted 
to the development, management, and reclamation of arid and semi-arid 
lands in the United States, Israel, and elsewhere in the world. The 
International Arid Lands Consortium will work to achieve research and 
development, educational and training initiatives, and demonstration 
projects. The current member institutions are the University of 
Arizona, The University of Illinois, Jewish National Fund, New Mexico 
State University, South Dakota State University, Texas A&M University, 
Kingsville, and Nevada's Desert Research Institute. The United States 
Department of Agriculture's Forest Service works very closely with The 
International Arid Lands Consortium through a service-wide memorandum 
of understanding. The Consortium's affiliate members include Egypt's 
Ministry of Agriculture and Land Reclamation Undersecretarial for 
Afforestation and Jordan's Higher Council for Science and Technology.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the Consortium was and continues to be 
acknowledged as the leading international organization supporting 
ecological sustainability of arid and semi-arid lands. To date, 56 
projects have been funded, 37 of which are to conduct research and 
development, 14 for demonstration projects, and 5 for international 
workshops. Funds approximating $3,390,000 have been used to fund these 
projects.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The International Arid Lands Consortium was incorporated in 
1991. Funds were appropriated to the Forest Service in 1993. Additional 
funds were received during each of the years that followed. $329,000 
has been appropriated from CSREES for fiscal years 1994 through 1998, 
and $400,000 for fiscal year 1999 for total appropriations of 
$2,045,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Members of the International Arid Lands Consortium have 
provided funds to support the Consortium office in Tucson, Arizona, and 
for printed materials as needed. Each member has provided travel and 
operations support for semi-annual meetings, teleconferences, and other 
related activities. In fiscal years 1993-1996, $60,000 in state 
appropriations were provided. Industry provided $84,083 and $100,000 in 
fiscal years 1993 and 1995, respectively. Additional funds of $34,000 
were received during 1996 from the Egyptian affiliate member to enhance 
future collaboration. Funds of $25,000 from industry were received in 
1998.
    Question. Where is this work being carried out?
    Answer. Research is currently being conducted at the University of 
Arizona, South Dakota State University, Texas A&M University, 
Kingsville, New Mexico State University, University of Illinois, and 
several research and education institutions in Israel.
    Question. What was the anticipated completion date for the original 
objectives of the projects? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives.
    Answer. Almost all research and demonstration projects that started 
during 1993 and 1994 have been completed. The projects started in 1995-
1997 are expected to be completed within 15 months depending upon the 
nature of the project. Projects started during 1998 will be completed 
within 2 years. Several demonstration projects were completed and 5 
international workshops were held during 1994 through 1998. The 
International Arid Lands Consortium is an organization with long-term 
goals.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The cognizant staff scientist reviews the project semi-
annually and has determined that the research is conducted is in 
accordance with the mission of the agency.
                     iowa biotechnology consortium
    Question. Please provide a description of the work that has been 
funded under the Iowa Biotechnology Consortium grant.
    Answer. This Consortium formed between Iowa State University, the 
University of Iowa, and the City of Cedar Rapids, Iowa, has served as 
the focal point for cooperative biotechnology research studies to 
recover and utilize byproduct materials arising from new and emerging 
industries in biotechnology with an emphasis on fermentation wastes and 
agribusiness. Both fundamental and applied research studies are being 
conducted to reduce the burden of agricultural bioprocessing wastes on 
municipal waste management systems and to transform components of these 
agricultural wastes into commercially-viable products. The overall 
project involves a coordinated approach by a diverse group of 
investigators, and funding decisions for individual studies within each 
participating institution are based on a competitive process with a 
peer panel review and evaluation. The overall project proposal 
submitted to us, which combines the selected individual studies, is 
also peer reviewed for scientific merit by a biotechnology panel 
designated by our agency.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Developments in biotechnology have added to the national 
need for improved management systems that increase the capacity and 
sophistication of agricultural waste processing. These researchers 
believe that technological breakthroughs are possible to deal 
effectively with the increasing burden of agricultural wastes and that 
useful byproduct materials can be recovered and recycled through the 
bioprocessing of wastes. The principal investigators consider this 
research to be of national, regional, and local importance. While they 
are working with wastes that are generated in and problematic for the 
State of Iowa, these waste streams are similar to those generated by 
agricultural industries across the United States.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals of this project were aimed at enhancing 
the recovery and utilization of by-product materials arising from 
industries using biotechnology. Recycling agricultural wastes, 
isolating useful byproducts, and developing value added processing 
remain the primary thrusts of the project. The Consortium has utilized 
a multi-disciplinary, multi-faceted research approach and has brought 
together a cadre of active scientists to assist in finding uses for the 
by-product waste streams generated by agricultural processing. The 
Consortium is making significant scientific progress related to the 
bioconversion, biocatalysis, membrane concentration, and bioseparation 
of by-products. Recent new studies have been initiated on value-added 
products related to culture of polysaccharide-producing bacteria, 
screening of agricultural seed processing fractions for biocatalysts, 
conversion of lignocellulose to lactic acid, the use of waste by-
products as feeds for livestock and aquacultural species, composting 
strategies for waste streams, and exploitation of micro-organisms that 
colonize extreme environments found in food processing plants..
    Question. How long has this work been under way and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $1,225,000; fiscal year 1990, $1,593,000; 
fiscal year 1991, $1,756,000; fiscal year 1992, $1,953,000; fiscal year 
1993, $2,000,000; fiscal year 1994, $1,880,000; fiscal years 1995-1996 
$1,792,000 each year; fiscal year 1997, $1,738,000; and $1,564,000 per 
year in fiscal years 1998 and 1999. A total of $18,857,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds and sources provided for this grant were 
as follows: $623,803 from the State of Iowa and $42,813 from the city 
of Cedar Rapids in 1991; $768,287 from the State of Iowa and $365,813 
from the city of Cedar Rapids in 1992; $858,113 from the State of Iowa 
and $170,000 from the city of Cedar Rapids in 1993; $841,689 from the 
State of Iowa and $36,000 from the City of Cedar Rapids in 1994; 
$1,016,505 from the State of Iowa and $36,000 from the city of Cedar 
Rapids in 1995; $862,558 from the State of Iowa and $40,000 from the 
City of Cedar Rapids in 1996; $1,044,864 from the State of Iowa and 
$50,000 from the City of Cedar Rapids in 1997; and $303,549 from the 
State of Iowa and $50,000 from the City of Cedar Rapids in 1998.
    In addition, leveraging of Federal grant monies has been obtained 
in the form of industrial matching funds or contracts for related 
projects. Some of the more noteworthy awards are as follows: $20,000 
from Archer Daniels Midland; $342,720 from Ajinomoto; $40,000 from 
BASF; $18,000 from Bluestem Solid Waste Agency; $1,748,975 from 
Cargill; $177,200 from Heartland Lysine, Inc.; $48,000 from Horizon 
Technology, Inc.; $75,274 from Iowa Corn Promotion Board; $65,200 from 
Iowa Energy Center; $80,273 from National Corn Growers Association, 
$25,000 from National Pork Producers Council; and $11,500 from 
PathoGenesis Corporation.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at Iowa State University and 
the University of Iowa, in collaboration with the City of Cedar Rapids.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Consortium was originally formed between the City of 
Cedar Rapids and the participating universities to assist the City in 
dealing with wastes associated with corn and oat processing and 
milling, biocatalysis to produce high-fructose syrups, and one of the 
largest fermentation facilities in the world. More recently, the 
diversified economic base of the Cedar Rapids area has attracted new 
biotechnology industries, which have added greatly to the volume of 
industrial waste streams. Since its inception, the Consortium has 
worked closely with the City and the industries producing these 
agricultural wastes. Because the studies continue to make progress in 
analyzing waste streams and in devising laboratory procedures for 
extracting useful products, no date has been established for the 
completion of this research. The City of Cedar Rapids is investing 
funds from other sources in special waste treatment facilities to 
conduct large scale tests of new treatment methods. Several years will 
be required to complete these tests and to refine separation 
technologies.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The fiscal year 1998 project proposal was evaluated for 
scientific merit on January 29,1998, by an agency peer panel that 
recommended its approval for the award. The Iowa Biotechnology 
Consortium proposal for fiscal year 1999 will be evaluated for 
scientific merit by a biotechnology peer review panel designated by the 
agency on February 9, 1999. The panel will review and evaluate the 
future studies that are proposed in the grant application and will make 
recommendations regarding overall approval of the project. In addition, 
the peer panel will assess past progress as a part of the approval 
process and of post-award management. A visit by the Program Manager to 
the research facilities of the cooperating institutions to conduct an 
on-site assessment is scheduled to occur during October, 1999.
                    ir-4 minor crop pest management
    Question. Please provide a description of the research that has 
been funded under the IR-4 Minor Crop Pest Management grant.
    Answer. The Minor Crop Pest Management Program--IR-4--formerly the 
IR-4 Pesticide Clearance Program, is a joint effort between the State 
Agricultural Experiment Stations, CSREES, and the Agricultural Research 
Service--ARS. IR-4 provides the national leadership, coordination, and 
focal point for obtaining data to support the regulatory clearance 
through the U.S. Environmental Protection Agency--EPA--for pesticides 
and biological control agents for specialty food crops such as fruits 
and vegetables as well as non-food crops like turf and ornamentals. In 
many cases, the agricultural chemical industry cannot economically 
justify the time and expense required to conduct the necessary research 
for products with limited market potential. With assistance from IR-4, 
registration-related costs are manageable, and producers of a large 
number of small acreage crops such as vegetables, fruits, nuts, herbs, 
and other specialized crops have access to necessary pest control 
products. In order to accomplish the above, a four-step process has 
been developed. Step one involves research prioritization. Because of 
limited resources, IR-4 requests and receives input from stakeholders 
on potential research projects. Yearly workshops are conducted that 
involve growers, commodity organizations, university research and 
extension specialists, EPA staff, and industry representatives to 
determine which projects are the most critical to minor crop 
agriculture. Step two is research planning. Research protocols are 
written after careful review and comments from stakeholders. Step three 
is research implementation. A typical IR-4 program consists of both 
field and laboratory phases. For the field work, researchers apply the 
crop protection chemical to the target crop per directions from the 
protocol. The crop is harvested and transferred to the laboratories 
where the amount of chemical remaining, if any, in the crop is 
determined. All field and laboratory research is conducted under EPA 
Good Laboratory Practices--GLP's. Step four is data submission and 
approval. The data are critically reviewed and formatted into a 
regulatory package and submitted to the EPA for their review. If 
appropriate, the EPA will approve the submission and grant a tolerance 
to use the chemical on the target minor crop.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The basic mission of IR-4 is to aid producers of minor food 
crops and ornamentals in obtaining needed crop protection products. IR-
4 is the principal public effort supporting the registration of 
pesticides and biological pest control agents for the $35,000,000,000 
plus minor crop industry. This is a national effort which identifies 
needs by a network of users, commodity groups and state university and 
Federal researchers. This research is highly significant to national 
and regional as well as local needs.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to obtain minor use and specialty use pesticide 
registrations, assist in the maintenance of current registrations and 
to assist with the development and registration of biopesticides and 
safer or Reduced Risk chemicals useful in Integrated Pest Management--
IPM--systems for minor crops. During the past two years, over 650 new 
minor food use clearance requests were submitted to IR-4 from growers, 
state, and Federal scientists and extension specialists. After 
evaluation and prioritization, over 300 studies consisting of over 
1,100 field trials throughout the U.S. have been conducted in 1997 and 
1998 alone. Accomplishments included the recent clearance of the 
herbicide pyridate on the ultra-minor crop garbanzo beans--chick pea--
grown on only 15,000 acres in the Pacific Northwest, which will have an 
estimated economic impact of increasing net revenue by over $3,300,000. 
This crop has become an important rotational crop due to changes in the 
government farm programs in that region. In 1998, EPA approved 55 new 
uses based on IR-4 data. In addition, EPA approved 43 Section 18 
Emergency Exemptions which were supported with IR-4 data. IR-4 has 
recently developed and submitted data to EPA for the insect growth 
regulator tebufenozide on blueberry, caneberries, canola, cranberry, 
mint and turnip. IR-4 expects EPA to register these reduced risk uses 
in early 1999. This chemical is extremely effective, and it has the 
potential to replace many high risk organophosphate and carbamate 
insecticides. The Cranberry Institute has estimated the use of 
tebufenozide can provide economic benefits from $17,000,000 to 
$35,000,000 annually depending on the severity of the target pest 
infestations. Because of its unique ability to control problem pests 
without damaging non-target pests and the environment, tebufenozide 
received the 1998 EPA Green Chemistry award. IR-4 has also worked with 
the vegetable herbicide clomazone to develop data that supported 24C 
registrations in Delaware, Virginia, and Maryland providing over 
$4,000,000 in benefits to snapbean, summer squash, and cucumber growers 
in those states.
    IR-4 provided residue data to support the FIFRA 88-mandated 
reregistration of more than 700 minor uses identified by growers as 
critical needs. Without IR-4, these uses would have been cancelled and 
not allowed for crop protection by minor crop growers. One of these IR-
4 defenses was streptomycin for the treatment of edible dry beans grown 
for seed on 15,000 acres in California and valued at $4,000,000 
annually. California seed is sold to growers in Colorado, Nebraska, 
Minnesota, the Dakotas, Wisconsin, Michigan, and New York where a 
disease known as halo blight can devastate untreated bean plantings. 
For this reason, growers will not purchase seed that is not treated 
with streptomycin.
    Registrations for the control of insect, disease and weed pests of 
commercially grown ornamental crops continues to be an important 
objective of the IR-4 Project. Since 1977, IR-4 has assisted with the 
registration of over 5,100 pesticides and biological pest control 
agents on woody nursery stock, flowers, and turf grass. Recently, IR-4 
developed data to allow the use of a herbicide for the control of 
yellow nutsedge and other grassy weeds in woody and perennial 
ornamental crops. In California alone, over 100,000 acres are treated 
with this herbicide, thereby saving growers $1,600,000 compared to hand 
weeding. IR-4 also continues to work closely with nurserymen and 
growers to develop pesticides such as azadiractin, a naturally-
occurring insecticide, for IPM programs.
    Biopesticides have been an important IR-4 thrust since 1982. IR-4 
conducts a competitive grants program to develop research data to 
support the registration of microbial and biochemical pest control 
products on minor crops. Equally important, IR-4 interacts with public 
guidance on EPA registration procedures. EPA granted 65 IR-4 supported 
biopesticide clearances in 1998 including one for Kaolin for insect, 
fungal, and bacteria control on 48 crops.
    The Food Use part of the IR-4 Program continues to have a high 
productivity which, according to EPA, supports 40 percent of all EPA 
pesticide registrations. Since the programs inception in 1963, IR-4 has 
been granted over 4,700 food use clearances--over 1,400 since 1984.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from appropriated funds as 
follows: Program redirection in fiscal year 1975, $250,000; fiscal year 
1976, $500,000; fiscal years 1977-1980, $1,000,000 per year; fiscal 
year 1981, $1,250,000; fiscal years 1982-1985, $1,400,000 per year; 
fiscal years 1986-1989, $1,369,000 per year; fiscal year 1990, 
$1,975,000; fiscal year 1991, $3,000,000; fiscal years 1992-1993, 
$3,500,000; fiscal year 1994, $6,345,000; fiscal year 1995 through 
1997, $5,711,000 per year; and fiscal years 1998 and 1999, $8,990,000. 
A total of $70,509,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $891,856 state appropriations and $65,402 industry in 
1991; $1,002,834 state appropriations and $104,292 industry in 1992; 
$1,086,876 state appropriations and $310,133 industry in 1993; $550,160 
state appropriations, $408,600 industry, and $924,169 miscellaneous in 
1994; $775,432 state appropriations, $266,714 industry, and $751,375 
miscellaneous in 1995; and an estimated $800,000 state appropriations, 
$250,000 industry, and $800,000 miscellaneous in each year of 1996, 
1997, 1998, and 1999.
    Question. Where is this work being carried out?
    Answer. Field work is performed at the State and Territorial 
Experiment Stations. Laboratory analysis is conducted primarily at the 
California, New York, Florida, and Michigan Agricultural Experiment 
Stations with assistance by the Oregon, Hawaii, North Dakota, North 
Carolina, Washington, Virginia, and Idaho Agricultural Experiment 
Stations. Field Research Centers located in Hawaii, Oregon, Washington, 
California, Wisconsin, Michigan, North Dakota, South Dakota, North 
Carolina, Florida, Tennessee, Texas, New Jersey, New York, Maryland, 
and New Hampshire conduct the field residue program. Protocol 
development, data assimilation, writing petitions, and registration 
processing are coordinated through the New Jersey Agricultural 
Experiment Station. ARS is conducting minor use pesticide studies at 
field locations in California, Georgia, Ohio, South Carolina, Texas, 
and Washington. ARS laboratories in Georgia, Maryland, and Washington 
are cooperating with analyzes.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Selected categories of the Special Research Grants Program 
address important national and regional research initiatives. IR-4 is 
involved in research on biological systems that by their nature are 
ever changing and presenting new challenges to agriculture. The IR-4 
workload is anticipated to be long term because of the sensitivities 
about food safety and the environment, and the eventual loss of a large 
number of conventional pesticide registrations for minor crops because 
of the 1996 Food Quality Protection Act--FQPA. The FQPA presents a 
serious challenge to minor crop pest management. It is estimated that 
there will be significant loss of conventional pesticide registrations 
for minor crops. IR-4 has developed a strategy to minimize the impact 
of loss of the critical pest control tools needed by our domestic minor 
crop growers. The IR-4 strategy involves the following factors: first, 
facilitating regulatory clearance of ``Reduced Risk'' pesticides for 
minor crops; second, when appropriate, develop risk mitigation measures 
for existing minor use registrations; third, assist with the 
registration of biologically-based pest control products for minor 
crops; and fourth, register and maintain pesticides essential to IPM 
systems
    This strategy has been in place since April 1997 and has helped IR-
4 achieve significant accomplishments. Since 1996, IR-4 has expedited 
research efforts on over 150 studies relating to reduced risk 
pesticides, biopesticides, and conventional pesticides critical to IPM 
programs. Several of these uses are referenced as ``Reduced Risk'' or 
``BioBased'' alternatives in the Consumer Union's ``Worse First'' 
report. For example, IR-4 has developed and submitted data to EPA for 
the biobased pesticide Spinosad on potato. This use has the potential 
to replace or reduce many of the high risk organophosphate and 
carbamate insecticide uses on potato. The FQPA program thrust will be 
carried out along with the traditional minor crop pesticide clearance 
program. Since FQPA requires that the EPA review all of the almost 
10,000 tolerances by 2006, it is anticipated that the IR-4 program will 
have a significant challenge to help bring new crop protection 
solutions to minor crop growers well into the next century.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Each year the program is peer reviewed and reviewed by 
CSREES' senior scientific staff. A summary of those reviews indicate 
excellent progress in achieving the objective of providing safe pest 
controls for minor uses. In December 1997, CSREES sponsored a Peer 
Review of the Project by a panel of representatives from USDA, EPA, 
commodity groups, the food processing industry, the crop protection 
industry, and the land grant university system with a final report 
issued January 1998. The report covered the areas of response to FQPA, 
Project operations, accomplishments, good laboratory practices--GLP--
the ARS companion program, and future outlook with specific 
recommendations for each area. Most of those recommendations have been 
implemented in 1998 programs or will be implemented in 1999. The panel 
was in unanimous agreement that IR-4 is a very successful program which 
serves an important need to producers of agricultural products for 
ultimate consumption by the American public. The program is effectively 
and efficiently administered by a dedicated professional staff. The 
goal in 1999 and beyond will be to build on this basis and fully 
implement the recommendations of the panel. This review and previous 
reviews have resulted in significant improvement in the IR-4 programs 
productivity and quality of research. Additionally, the customers 
served by IR-4 have provided input to the program to enhance its 
effectiveness.
                           jointed goatgrass
    Question. Please provide a description of the research that has 
been funded under the Jointed Goatgrass grant.
    Answer. Research is conducted as sub-projects by more than 30 
scientists in 10 western and mid-western states on systems for 
suppression of jointed goatgrass in winter wheat production systems. 
Research includes integrated cultural management, reduction of seed in 
the soil, identification of more competitive wheat varieties and crop 
rotations, and modeling to predict economic outcomes of changing 
management practices. The premier research projects continue to be four 
regional, long-term integrated management studies conducted across nine 
states. In these studies, various cultural control practices such as 
seeding rates, row spacing, planting dates, seed size, competitive 
varieties, fertilizer placement, crop rotations, and tillage practices 
are being evaluated as an integrated management system for the 
suppression of jointed goatgrass. Research is also being conducted on 
genetic diversity in the jointed goatgrass population, soil conditions 
responsible for persistence of jointed goatgrass seedbank, timing and 
intensity of tillage on seed persistence in the soil, gene flow between 
wheat and jointed goatgrass, identification of crop traits that make 
wheat more competitive against jointed goatgrass, and making the 
bioeconomic model more user friendly. All funded projects have a 
technology transfer component, and a national extension coordinator 
insures that growers and extension personnel are fully informed about 
all options for the managing this devastating weed. The National 
Extension Coordinator is housed at Colorado State University.
    Question. According to the research proposal or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Jointed goatgrass infests nearly 5,000,000 acres of winter 
wheat lands in the west and mid-west. Through the efforts of the 
national program, the rate of spread of this weed has decreased 
significantly in the past 5 years. However, jointed goatgrass still 
costs U.S. wheat producers an estimated $145,000,000 annually in lost 
yield, reduced quality, production of less profitable crops, increased 
management costs, and reduced land values. Control of jointed goatgrass 
in a standing wheat crop is impossible with currently available 
technology because seed survives in the soil for five years or more, 
and because jointed goatgrass is genetically related to wheat. Jointed 
goatgrass has increased rapidly in the past 25 years in part because of 
the widespread adoption of conservation tillage systems. Jointed 
goatgrass proliferated in such systems, and it greatly impedes the 
universal adoption of such practices. The principal investigator and 
the National Association of Wheat Growers believe this research is of 
high national and regional importance.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this project is to reduce the devastating 
effect of jointed goatgrass on winter wheat production and quality, and 
to prevent the spread of this weed into new, non-infested areas. 
Numerous individual cultural control practices have been evaluated in 
several states as to their effectiveness for the suppression of jointed 
goatgrass and on the growth and yield of wheat. Four regional, long-
term integrated management projects have been established where three 
or more individual cultural control practices have been combined into 
an integrated management system for the suppression of jointed 
goatgrass in winter wheat. Early results from these projects show 
promising results for the management of jointed goatgrass. A 
bioeconomic model has been constructed that combines jointed goatgrass 
population biology information, weather data, and responses of jointed 
goatgrass and wheat to various cultural control practices, and predicts 
wheat yields, response of jointed goatgrass, and economic outcomes from 
changing production practices. Six regional symposia have been held to 
transfer to producers and extension personnel the latest information on 
the identification, biology and management of jointed goatgrass in 
winter wheat. A World Wide Web site has been established to further 
enhance information transfer. Also, a videotape and a slide set have 
been produced to assist extension personnel in transferring information 
on jointed goatgrass biology and management.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $329,000; for fiscal years 
1995-1997, $296,000, each year; $346,000 for fiscal year 1998; and 
$360,000 in fiscal year 1999 bringing the total appropriations to 
$1,923,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: for 1994, $82,198 state appropriations, $82,256 from 
industry, and $14,871 miscellaneous; for fiscal year 1995, $67,442 
state appropriations, $38,496 from industry, and $13,304 miscellaneous; 
for each fiscal year 1996-1997, an estimated $70,000 state 
appropriations, $50,000 from industry, and $14,000 miscellaneous; and 
for 1998, $231,335 state appropriations and $42,570 from State wheat 
commissions.
    Question. Where is this work being carried out?
    Answer. The research is being conducted by University scientists in 
the states with serious infestations including Washington State 
University, who are the principal coordinating institution and receive 
the grant, Colorado, Kansas, Nebraska, Oklahoma, Utah, Oregon, Idaho, 
Montana, Wyoming, and South Dakota.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was initiated to accomplish significant results 
in five years, and significant accomplishments have been made. However, 
the jointed goatgrass problem will require an additional five more 
years to accomplish all of the objectives and to have effective 
management practices available for producers to control jointed 
goatgrass in winter wheat.
    Question. When was the agency evaluation of this project? Provide a 
summary of the last evaluation conducted.
    Answer. Each year the grant is peer reviewed and reviewed by 
CSREES's senior scientific staff. Grants are awarded on a competitive 
basis using a peer review process by Washington State University.
             livestock and dairy policy, new york and texas
    Question. Please provide a description of the research that has 
been done under the livestock and dairy policy program grant?
    Answer. The purpose of this grant is to assess the possible 
economic impacts on the U.S. livestock and dairy sectors from various 
macroeconomic, farm, environmental, and trade policies and new 
technologies. Both Cornell University and Texas A&M University conduct 
analyses of these policies and disseminate the information to 
policymakers, farmers, and agribusinessmen. Cornell focuses on sector-
level dairy policies, and Texas A&M focuses on policies affecting 
livestock and dairy at the farm level.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Information on the implications of new and alternative 
farm, trade, and macroeconomic policies affecting the livestock and 
dairy sectors is of special interest to policy-making officials, 
farmers, and others. Such information enables farmers and 
agribusinessmen to make necessary adjustments to their operations to 
enhance profitability and for national public officials to consider 
alternatives to sustain adequate supplies and minimize costs. The 
principal researchers believe this research to be of national, 
regional, and local significance.
    Question. What was the original goal of this research and what has 
been done to date?
    Answer. The original goal was to establish a specialized research 
program that could provide timely and comprehensive analyses of 
numerous policy and technological changes affecting livestock and dairy 
farmers and agribusinessmen and advise them and policymakers promptly 
of possible outcomes. This goal has been achieved and the program 
continues to provide timely assessments and evaluations of provisions 
and proposed changes in agricultural policies, the General Agreement on 
Tariffs and Trade, and the North American Free Trade Agreement; various 
income and excise tax measures; and alternative pricing measures for 
milk. The institutions were integrally involved in several current 
studies relating to dairy provisions in the 1996 farm legislation. 
These studies contributed significantly to the development of proposed 
regulations called for in this legislation. Both institutions maintain 
extension outreach programs to disseminate results of their analyses 
throughout the United States. They have organized a national Dairy 
Markets and Policy Extension committee to advise and assist them in 
this effort. This latter committee was especially helpful to USDA in 
educating farmers about proposed milk marketing order changes last 
year.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $450,000; fiscal year 1990, $518,000; fiscal 
years 1991-1993, $525,000 per year; fiscal year 1994, $494,000; fiscal 
years 1995-1998, $445,000 each year; and fiscal year 1999, $475,000. A 
total of $5,292,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $37,420 State appropriations in 1991; $162,086 State 
appropriations and $133,278 product sales for a total of $295,364 in 
1992; and $301,817 State appropriations, $1,412 industry, and $7,121 
miscellaneous for a total of $310,350 in 1993; $24,702 State 
appropriations and $5,961 industry for a total of $30,663 in 1994; 
$235,526 State appropriations for 1995; $250,000 in State 
appropriations for 1996; and approximately $245,000 in State funding 
for 1997 and 1998.
    Question. Where is this work being carried out?
    Answer. The research is being conducted at Cornell University and 
Texas A&M University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This program is of a continuing nature for the purpose of 
assessing existing issues and proposed policy changes affecting the 
livestock and dairy industries.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We have conducted no formal evaluations of this project. 
Annual proposals for funding, however, are peer reviewed for relevance 
and scientific merit. Our agency contact is also in regular contact 
with principal researchers at each institution to discuss progress 
toward project objectives. Discussions with congressional staff and 
USDA policy makers support the usefulness of policy analyses provided 
by this project.
                   lowbush blueberry research, maine
    Question. Please provide a description of the research that has 
been funded under the lowbush blueberry research program grant.
    Answer. Interdisciplinary research is being conducted on many 
aspects of lowbush blueberry culture and processing including 
investigations into factors affecting processing quality, biological 
control of insect pest, sustainable pollination, weed, disease, and 
fertility management, cold heartiness, and group water protection.
    Question. According to this research proposal, or the principal 
investigator, what is the national, regional, or local need for this 
research?
    Answer. Maine produces 99 percent of all lowbush blueberries or 33 
percent of all blueberries in the United States. This work is of major 
local interest and helps maintain the continued availability and high 
quality of the native fruit commodity.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original research goal was to provide answers to unique 
lowbush blueberry production, pest, and processing problems. Research 
to date indicates that the field sanitizer was able to use heat to 
control insect pests without adversely affecting plant growth, while 
providing a non-chemical alternative for pest management. Biological 
control agents were sued to control fireworms. Lowbush blueberry yields 
were increased by use of native leafcutter and alfalfa leafcutter bees. 
Mechanical harvesting was found to be effective and had yields and 
fruit quality comparable to hand harvest, providing growers with a more 
efficient tool to harvest blueberries. Productes for the use in food 
industry are being extracted from cull berries, therefore, improving 
utilization and reducing waste.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1990, $170,000; fiscal year 1991, $202,000; fiscal 
years 1992-1993, $185,000 per year; fiscal year 1994, $208,000; and 
fiscal years 1995-1999, $220,000 per year. A total of $2,050,000 has 
been appropriated to date.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. Direct industry support was about $65,000 from 1996-1998, 
per year. The 1999 nonfederal support is $205,832 from industry.
    Question. Where is this work being carried out?
    Answer. Research is being carried out at the University of Maine.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives have not yet been met. The 
University of Maine researchers estimate that the project will be 
concluded at the end of fiscal year 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last agency merit review of this project was January, 
1998. Research accomplishments included investigations of post 
emergence, grass-specific herbicides to control weeds rather than the 
use of broad spectrum; timing of fertilization treatments; and 
comparisons of various fertilizer combinations have indicated that 
fertilizers containing nitrogen increase yields. Other research 
accomplishments include the insect management of blueberry maggots 
through behavioral control and the use of less toxic chemicals from 
control of blueberry flea beetles.
                        maple research, vermont
    Question. Please provide a description of the research that has 
been funded under the Maple Research grant?
    Answer. The research is designed to increase understanding of the 
sources of heavy metal contamination in maple sap and syrup and explore 
methods of reducing or eliminating lead and other heavy metal 
contaminant levels in the finished product through alteration of 
manufacturing equipment and processes. The project is annually 
subjected to the University's merit review process.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local focus for this 
research?
    Answer. Maple products are an important cultural heritage, and a 
source of seasonal income in maple growing areas of rural America. 
Identifying sources of heavy metal contaminants during processing and 
methods to remove contaminants from products is important in assuring 
consumers that these food products are not harmful.
    Question. What was the original goal of this research and what has 
been accomplished?
    Answer. The goal of this research is to conduct research on maple 
tree physiology, management of maple stands, and related aspects of the 
maple syrup industry in Vermont and the Northeast. The primary goal of 
this work has been to identify and eliminate sources of lead and other 
heavy metal contaminants in maple syrup.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Work under this project began in fiscal year 1985. Annual 
appropriations in support of this project are as follows: fiscal year 
1985--$100,000; fiscal years 1986 and 1987--$95,000 per year; fiscal 
years 1988 and 1989--$100,000 per year; fiscal years 1990 through 
1993--$99,000 per year; fiscal year 1994--$93,000; fiscal years 1995 
through 1997--$84,000 each year; and fiscal years 1998 and 1999--
$100,000 per year. A total of $1,431,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal fiscal support for this project is provided by 
two primary sources and one secondary source. The primary sources are 
state appropriations and product sales. The secondary source is local 
support, but that support is not available each year. The total non-
federal contribution from these sources provides an average ratio of 
.86 to 1. The low ratio was .6 to 1 early in the project. More recently 
the ratio has been 1.1 to 1.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at the Vermont 
Agricultural Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The work from this project, relative to maple tree 
physiology and management of maple stands has been completed. The 
objective of identifying sources of heavy metals in maple syrup 
products and, subsequently, reducing them is underway. The anticipated 
completion date is 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Project proposals and progress reports are reviewed and 
evaluated annually by the U.S. Department of Agriculture. Satisfactory 
progress has been made on tree physiology and maple tree management. 
Progressive work on identifying sources and controlling maple syrup 
contaminants is in place and is being monitored by the Department.
                           meadowfoam, oregon
    Question. Please provide a description of the research that has 
been funded under the Meadowfoam, Oregon grant.
    Answer. This funding will be used to: develop meadowfoam cultivars 
with increased seed yield, lodging resistance, oil concentration, and 
insect resistance; increase seed, field test, and deploy several new 
experimental cultivars; enhance the genome map of meadowfoam; develop 
DNA markers for molecular breeding and genetic analysis in meadowfoam; 
and map genes affecting self-pollination, seed yield, oil content, and 
insect resistance. The proposal will be internally and externally 
reviewed for scientific merit. This research will be reviewed by state 
and Federal scientists and administrators for merit and progress.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. This research is needed to increase the productivity of 
meadowfoam as an edible and industrial oilseed crop. Meadowfoam oil is 
a basic feedstock for lubricants, cosmetics, and personal care 
products. Oregon State University has recently developed a food grade 
meadowfoam oil that should open edible oil markets for this crop. This 
research is needed to expand the range of production of meadowfoam and 
to supply U.S. farmers with competitive cultivars--varieties--for 
commercial production.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to increase the 
productivity of meadowfoam as an oilseed crop for U.S. farmers. This 
work continues with the new appropriation in 1999.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $300,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds have not been provided.
    Question. Where is this work being carried out?
    Answer. The breeding research is being conducted at Corvallis, 
Oregon. Cultivars are being field tested at four sites in the western 
United States including Corvallis and Medford, Oregon, Mt. Vernon, 
Washington, and Davis, California, and three sites in the eastern 
United States including Blacksburg, Virginia, and two as yet 
unspecified sites.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objectives of the project sponsored by Cooperative 
State Research, Education, Extension Service have not yet been met, 
however, these objectives are anticipated to be complete within the 
first year of the project.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This is the first year of this project.
                   michigan biotechnology consortium
    Question. Please provide a description of the work that has been 
funded under the Michigan Biotechnology Consortium grant.
    Answer. The objective of the Consortium's research program is to 
develop bioprocessing technology to manufacture products from 
agricultural raw materials; to increase the utilization of agricultural 
raw materials; reduce agricultural surpluses; degrade agricultural and 
associated wastes, thereby decreasing environmental costs of 
agricultural products and processes; and to reduce the need to import 
foreign petroleum. Using the tools of bioprocessing, agricultural 
resources can be transformed into products equal in function and value 
to those currently made from petroleum.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes results from the research 
will help to develop bioprocessing technologies to manufacture value-
added products from agricultural raw materials, which increases their 
utilization, reduces commodity surpluses, reduces environmental costs, 
and decreases the need for foreign petroleum thus contributing 
significantly to local, regional, and national priorities. 
Biotechnology research of national significance could potentially be 
supported by competitive grants awarded under the National Research 
Initiative or the Initiative for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is to select and develop market-
viable technologies that form the basis for new companies, new jobs, 
and additional tax revenues for local, state, and Federal governments. 
During the past several years, the Consortium has used funding from the 
Special Grants program to develop technologies that are now in the 
marketplace. Examples include: Production of lactic acid using corn as 
the feedstock resulting in a polymer for biodegradable plastics and a 
disinfectant. A $200,000,000 plant has been built in Nebraska to 
produce lactic acid by this process for domestic and foreign markets. 
Corn was used as a feedstock to develop plant growth formulations to 
enhance plant growth and productivity and to reduce plant stress. 
Growth promoters are being introduced to the marketplace on a 
nationwide basis. Biodegradable plastic resins developed from 
cornstarch were made to produce compostable films for lawn and leaf 
litter bags, agricultural mulch films, and other soluble films. 
Biodegradable plastic resins from cornstarch were also developed for 
moldable products such as disposable cutlery, plastic containers, and 
toys and toothbrushes. The market for resins is in excess of 
$2,000,000,000 annually. Corn was also used for the development of all-
natural flavors and derivatives including a salty-flavored compound 
that can replace monosodium glutamate in low sodium foods. Low-cost, 
readily-available carbohydrates--from whey--were used to produce high-
quality, high-value optically-pure chiral intermediates for the 
pharmaceutical and agrochemical industries.
    A sand/manure separation system for dairy farms was developed to 
cost-effectively separate manure from sand and recycle both components. 
Biodegradable adhesives have been developed from agricultural 
resources. Numerous enzymes have been characterized and are now in use 
to provide value added modifications in the processing of agricultural 
products. A stabilized phytase enzyme has been developed to improve 
digestibility of forage-based animal feeds and reduce animal wastes. 
Improved methods to clean up herbicides, pesticides, and other 
agriculturally-important materials have been developed. Many of these 
products have been commercialized through licensing agreements with 
industrial partners or new company start-ups. Special grant funding in 
fiscal year 1998 allowed the Consortium to develop several new agri-
based products including: paint removers; calcium magnesium acetate 
deicer; biobased membrane polymers for liquid crystals, metals 
recovery, and other uses; improved specialty enzymes; and high value 
animal feed from rice straw. Funding also supported a technology 
transfer program that brought researchers from almost 30 land grant 
universities, Federal laboratories, and USDA, together with Consortium 
researchers to review numerous commercially-promising agriculturally-
based technologies. A cooperative research and development agreement 
was signed with the USDA's Northern Regional Laboratories to develop 
technology for an oxidant-stable protease for laundry detergents, 
household cleaners, body cleaners, and dehairing and leather tanning 
agents.
    Question. How long has this work been under way and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $1,750,000; fiscal year 1990, $2,160,000; 
fiscal year 1991, $2,246,000; fiscal years 1992-1993, $2,358,000 per 
year; fiscal year 1994, $2,217,000; fiscal year 1995, $1,995,000; 
fiscal years 1996 and 1997, $750,000 per year; and fiscal years 1998 
and 1999, $675,000 per year. A total of $17,934,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $1,750,000 in State of Michigan appropriations, 
$160,000 from industry, and $1,000,000 from miscellaneous in 1991; 
$1,750,000 in State of Michigan appropriations, $175,000 from industry, 
and $1,000,000 from miscellaneous in 1992; $1,750,000 in State of 
Michigan appropriations and $100,000 from industry in 1993; $1,750,000 
in State of Michigan appropriations, $175,000 from industry, and 
$100,000 from miscellaneous in 1994; $200,000 in State of Michigan 
appropriations and $2,035,000 from industry in 1995; $1,250,000 in 
State of Michigan appropriations, $350,000 from industry, and 
$6,000,000 from miscellaneous in 1996; $402,500 from industry and 
$10,000,000 from miscellaneous in 1997; and $500,000 in State of 
Michigan appropriations, $90,000 from the North Central Biotechnical 
Program, $150,000 from the Illinois Corn Marketing Board, and $820,000 
from the California Air Resources Board in 1998. A total of $31,507,500 
has been provided to support this work by non-federal sources.
    Question. Where is this work being carried out?
    Answer. The research is being conducted on the campus of Michigan 
State University and at the Michigan Biotechnology Institute 
International. Demonstrations of technology occur throughout the United 
States.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Consortium reports specific milestones for technology 
development over a five year period. Specific milestones for 
technologies which will be commercialized in fiscal year 1999 were 
established in fiscal year 1995 and updated annually. The Consortium 
has been successful in effectively closing the gap between research and 
commercialization in the five-year period.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Michigan Biotechnology Institute was evaluated for 
scientific merit by an agency peer review panel on January 29, 1998. 
The panel recommended approval of the project pending receipt of 
supplemental information on administrative aspects of the project. A 
peer panel of scientists is scheduled to re-evaluate the scientific 
merit of the project on February 9, 1999.
         midwest advanced food manufacturing alliance, nebraska
    Question. Please provide a description of the research that has 
been funded under the Midwest Advanced Food Manufacturing Alliance 
grant.
    Answer. The stated purpose of the Midwest Advanced Food 
Manufacturing Alliance is to expedite the development of new 
manufacturing and processing technologies for food and related products 
derived from United States produced crops and livestock. The Alliance 
involves research scientists in food science and technology, food 
engineering, nutrition, microbiology, computer science, and other 
relevant areas from 12 leading Midwestern universities and private 
sector researchers from numerous United States food processing 
companies. Specific research projects are awarded on a competitive 
basis to university scientists with matching funds from non-federal 
sources for research involving the processing, packaging, storage, and 
transportation of food products. Projects selected for funding are 
merit reviewed by non-participating university scientists, industry 
scientists, and scientists from professional organizations. Close 
cooperation between corporate and university researchers assure that 
the latest scientific advances are applied to the most relevant 
problems and that solutions are efficiently transferred and used by the 
private sector. fiscal year 1998 funds are supporting research from 
June 1, 1998 through May 31, 1999. CSREES has requested, but not yet 
received, a proposal in support of the fiscal year 1999 appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
project?
    Answer. The principal researcher believes the food manufacturing 
industry is the number one manufacturing industry in the Midwestern 
region and that opportunities for trade in high value processed food 
products will grow exponentially on a worldwide basis. The Alliance is 
positioned to fill the void in longer range research and development 
for the food industry. Though the focus is regional, it is anticipated 
that impacts may also be local and national.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal, as stated previously, was to expedite the 
development of new manufacturing and processing technologies for food 
and related products derived from United States produced crops and 
livestock. This is accomplished by conducting a research proposal 
competition among faculty from the 12 participating universities to 
fund research projects where matching funds are available from 
industry. Fourteen projects were funded from fiscal year 1994 funds 
with completion and final reports due by May 1, 1996. Ten projects were 
funded from fiscal year 1995 funds with anticipated completion and 
final reports due by August 31, 1997. Ten projects were also funded 
from fiscal year 1996 funds with anticipated completion and final 
reports due by May 31, 1998. Eleven projects were funded from fiscal 
year 1997 funds with anticipated completion and final reports due by 
May 31, 1999. Nine projects were funded from fiscal year 1998 funds 
with anticipated completion and final reports due by May 31, 2000. 
Proposals are reviewed for scientific merit by independent scientists, 
and final selection of projects includes consideration of industrial 
interest and commitment on non-Federal matching funds.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994. 
The appropriation for fiscal year 1994 was $470,000, and for fiscal 
years 1995-1999, $423,000 each year. A total of $2,585,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Industry matching funds were $823,148 in fiscal year 1994, 
$414,164 in fiscal year 1995, $576,600 in fiscal year 1996, $429,579 in 
fiscal year 1997, and $557,549 in fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. The work is being coordinated by the Nebraska Agricultural 
Experiment Station at Lincoln. Specific research projects are also 
being conducted at 10 other universities that are part of the Alliance.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The overall objectives of the Alliance are ongoing. Funding 
supports the continuing and evolving needs and opportunities for foods 
manufactured and processed from United States produced crops and 
livestock.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
A review of the proposal was conducted on January 12, 1998. The 
principal investigator has provided descriptions of projects funded by 
this grant. Scientifically sound, industry-relevant projects appear to 
be the basis of the project, with impactful results expected.
                  midwest agricultural products, iowa
    Question. Please provide a description of the research that has 
been done under the Midwest Agricultural Products program.
    Answer. The Midwest Agribusiness Trade Research and Information 
Center does applied research to improve the global competitiveness and 
marketability of agricultural products produced in the Midwest and 
disseminates the results to small and medium-sized agribusinesses. 
Projects include analyses of potential markets for U.S. agricultural 
products and equipment/technology in several countries; attitudes of 
foreign consumers; development of new/improved U.S. products to meet 
foreign needs. The overall project proposal received a merit review at 
the university level and individual research activities are reviewed by 
the principal investigator and other faculty.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes that agribusiness firms 
in the United States, especially small to medium-sized firms, have a 
large unrealized potential to expand export sales and foreign business 
ventures. These untapped opportunities exist in the Pacific Rim and in 
emerging markets such as Mexico, China, and Eastern Europe. The 
reluctance of small to medium-sized firms to explore these market 
opportunities is, in part, due to the high cost of market information 
and analysis and the perceived high risk of doing business in new 
markets. This project meets the needs of these firms at the local, 
regional, and national level.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The goal is to enhance the exports of agricultural 
commodities, value-added products, and equipment produced by Midwestern 
agribusiness firms through research and education programs involving 
close-working relationships with those firms. Recent results include 
analyses of the markets in selected countries--Hungary, Poland, 
Lithuania, Egypt and Morocco--to identify opportunities for U.S. food 
products, processes, and equipment; Mexican consumer response to U.S. 
pork products; comparative advantage of U.S. pork in North American 
markets; impact of the North American Free Trade Agreement on Midwest 
beef industry; evaluation of 60 varieties of corn for dry milling for 
the Mexican market; forums that link international leaders visiting 
Iowa State University with agribusiness leaders; linkages between 
international and Midwest business interests; and profiles on several 
overseas companies suitable as trading partners. Several business 
agreements and a considerable amount of trade has resulted from these 
activities. The primary audience is small to medium-sized agribusiness 
firms because they often lack the resources to conduct studies or 
acquire sufficient marketing information to engage in international 
trade. As a result of much work to establish trading relationships with 
China, the Des Moines sister-city of Shijiazhuang, China established a 
trade office in Des Moines.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1992. 
The appropriation for fiscal years 1992-1993 was $700,000 per year; 
fiscal year 1994, $658,000; and fiscal years 1995-1999, $592,000 per 
year. A total of $5,018,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $185,495 State appropriations and $373,897 industry for 
a total of $559,392 in 1992; $183,192 State appropriations and $318,966 
industry for a total of $502,158 in 1993; $127,948 State appropriations 
and $500,394 industry for a total of $628,342 in 1994; $258,053 State 
appropriations and $389,834 industry for a total of $647,887 for 1995; 
$165,425 State appropriations for 1996; $162,883 State appropriations 
for 1997; and $143,850 State appropriations and $51,384 industry for a 
total of $195,234 in 1998. Industry contributions were not reported for 
1996-1997.
    Question. Where is the work being carried out?
    Answer. The program is carried out by Iowa State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1992 was for a period of 24 
months, however, the objective of expanding the export capacity of 
small to medium-sized agribusiness firms is an ongoing regional and 
national concern. The current phase of the program will be completed in 
2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES performed a merit review of the project in January 
1998, as it evaluated the project proposal for 1998, and concluded that 
``the project has sound objectives and procedures that are helping 
agribusiness effectively expand markets for U.S. agricultural products 
leading to a highly competitive agricultural production system and 
enhanced economic opportunity for Americans''. Research results appear 
in several peer-reviewed professional journals and the popular press.
                       milk safety, pennsylvania
    Question. Please provide a description of the research that has 
been funded under the milk safety grant.
    Answer. The overall goal of the milk safety program is to provide 
insight into factors that help ensure an adequate and safe milk supply. 
Toward that end, the research has focused on factors that affect milk 
production, processing, manufacturing, and consumption. Special 
attention has been given to ways of preventing and/or treating 
pathogens that enter the milk supply. Projects are selected for funding 
each year based on competitive, peer reviews by scientists outside the 
recipient institution. The fiscal year 1999 grant will support research 
through June 30, 2000. CSREES has requested the University to submit a 
proposal in support of fiscal year 1999 funds, but the proposal has not 
yet been received due to the University's merit review process to 
select projects for funding.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that the question of 
microbial safety is of paramount interest to the milk/dairy industry at 
all levels--national, regional and local. Dairy products have been 
associated with several large outbreaks of staphylococcal food 
poisoning. Coagulase negative Staphylococcus infections are one of the 
most common intramammary infections of dairy cattle, and bovine 
mastitis, the most important infectious disease affecting the quality 
and quantity of milk produced in the nation, costs producers an average 
$180 per cow per year. Listeria monocytogenes is present in about 4 
percent of raw milk and has the potential to grow to dangerous levels 
during refrigerated storage making pasteurization critical in 
preventing foodborne illnesses from this organism. The population of 
infants, elderly, and immunosuppressed individuals at risk for 
Listeriosis in the United States continues to grow rapidly. 
Understanding the growth of Listeria will provide pathways to minimize 
the occurrence of food poisoning related to milk and dairy products. 
Pathogenic E. coli species, including E. coli O157:H7, are of public 
health concern. For products which receive minimal thermal processing 
or which may be preserved primarily by acidification, development of 
additional means of controlling the growth of these foodborne pathogens 
is of critical importance in guaranteeing a safe milk supply. Ensuring 
safety of dairy products impacts not only consumer health and 
confidence in the safety of the food supply, but economic viability as 
well.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The research is aimed at minimizing or eliminating future 
foodborne disease outbreaks from milk and dairy products. Researchers 
demonstrated that when subjected to a sublethal heat shock prior to 
pasteurization, Listeria monocytogenes becomes much more heat-resistant 
than previously thought, likely requiring the design of new 
pasteurization guidelines to ensure the safety of dairy products. They 
also developed a simple, fast, sensitive, specific, and inexpensive 
method for the detection of Listeria monocytogenes in dairy products 
that will allow dairy processors to rapidly and easily screen for the 
presence of this pathogen in their products and in the processing 
environment. A computer model of Listeria monocytogenes growth in dairy 
foods under dynamic refrigeration conditions and during extended 
storage is under development to provide producers and processors a 
technology for further enhancing the safety of fluid milk and related 
products. Researchers have identified potential approaches for 
enhancing natural defense mechanisms of the bovine mammary gland 
through vaccination and immunoregulation. Discoveries of factors 
influencing growth of Staphylococcus aureus could be used to prevent or 
contain growth of this pathogen in foods. Researchers have identified 
and sequenced a gene from this bacterium that is essential for growth 
under stressful conditions. Consumer research has identified 
characteristics of consumers most likely to have a high general concern 
about milk and dairy product safety and nutrition.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded for milk consumption and milk 
safety from funds appropriated as follows: fiscal years 1986 through 
1989, $285,000 per year; fiscal year 1990, $281,000; fiscal year 1991, 
$283,000; fiscal year 1992, $284,000; fiscal year 1993, $184,000; 
fiscal years 1994-1998, $268,000 per year; and fiscal year 1999, 
$250,000. A total of $3,762,000 has been appropriated for milk safety 
and milk consumption.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The University estimates that non-federal funds contributed 
to this project include the following costs and salaries: $265,000 for 
fiscal year 1991; $224,700 for fiscal year 1992; $142,600 for fiscal 
year 1993; and $252,168 for fiscal year 1995. No data are currently 
available for other fiscal years.
    Question. Where is the work being carried out?
    Answer. The research is being conducted at the Pennsylvania State 
University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The researchers anticipate that research supported by this 
grant should be concluded in 1999. Continuing and evolving needs 
related to the safety of milk and dairy products are expected to reveal 
new related objectives.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
The proposal supporting the fiscal year 1998 appropriation was reviewed 
on April 23, 1998, and the agency science specialist concluded that the 
projects addressed important issues related to safety of milk and dairy 
products, were scientifically sound, and that satisfactory progress was 
being demonstrated using previously awarded grant funds.
                         minor use animal drugs
    Question. Please provide a description of the research that has 
been funded under the minor use animal drug program grant.
    Answer. The National Agricultural Program to Approve Animal Drugs 
for Minor Species and Uses--NRSP-7--was established to obtain the Food 
and Drug Administration approval of animal drugs intended for use in 
minor species and for minor uses in major species. The objectives of 
the program are to identify the animal drug needs for minor species and 
minor uses in major species; generate and disseminate data for the 
safe, effective, and legal use of drugs used primarily in therapy or 
reproductive management of minor animal species; and facilitate the 
Food and Drug Administration--FDA--in obtaining approvals for minor 
uses. Studies are conducted to determine efficacy, target animal 
safety, human food safety, and environmental safety. The shortage of 
drugs for minor food animal uses is a concern well recognized by animal 
producers, veterinarians, animal scientists, and regulators. The funds 
for the special research grant are divided between the four regional 
animal drug coordinators and the headquarters at Cornell University for 
support of the drug approval program. The NRSP-7 funds are being 
utilized by the State Agricultural Experiment Stations where the 
regional animal drug coordinators are located as well as by other 
stations to develop data required for meeting approval requirements. 
Participants in the research program consist of the regional 
coordinators, State Agricultural Experiment Stations, USDA's 
Agricultural Research Service, schools of veterinary medicine, and the 
pharmaceutical companies. Research priorities are continually updated 
through workshops and meetings with producer groups representing 
species categories such as small ruminants, game birds, fur-bearing 
animals, and aquaculture species. Each request for drug approval is 
evaluated by the technical committee according to established criteria 
which include significance to the animal industry, cost of developing 
the necessary data, availability of a pharmaceutical sponsor, and food 
safety implications. The fiscal year 1998 research grants terminate in 
April 2000. The 1999 grant proposals have been requested by the agency. 
All grants are reviewed for relevance to industry needs and undergo 
scientific peer review.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Animal agriculture throughout the United States has relied 
on chemical and pharmaceutical companies to provide their industry safe 
and efficacious drugs to combat diseases and parasites. The high cost 
incurred to obtain data to approve these drugs, when coupled with 
limited economic returns, has limited the availability of approved 
drugs for minor uses and minor species. The economic losses due to the 
unavailability of drugs to producers for minor species and minor uses 
threatens the economic viability of some segments of the animal 
industry. The need for approved drugs to control diseases in minor 
species and for minor uses in major species has increased with 
intensified production units and consumer demand for residue-free meat 
and animal products. The program provides research needed to develop 
and ultimately culminate in drug approval by FDA for the above 
purposes. The goals are accomplished through the use of regional animal 
drug coordinators as well as a national coordinator to prioritize the 
need, secure investigators at Federal, state and private institutions, 
and oversee the research and data compilation necessary to meet Federal 
regulations for approval. All drug approvals are national, although 
industry use may be regional. For example, certain aquaculture and the 
game bird industries are concentrated in specific geographic sections 
of the country. The administration believes this research to be of 
national, regional, or local need.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original NRSP-7 goal to obtain approval by the Food and 
Drug Administration for animal drugs intended for use in minor species 
and for minor uses in major species remains as the dominant goal of the 
program. In recent years, the research program has expanded or given 
additional emphasis to aquaculture species, veal calves, and sheep. In 
addition, several new animal drug requests were recently received for 
game birds. The importance of environmental assessment, residue 
withdrawals, and occupational safety have increasingly been given more 
attention during the approval process to help assure consumer 
protection. To date, 299 drug requests have been submitted to the Minor 
Use Animal Drug Program for the development of data in support of the 
submission of a New Animal Drug Approval. Working in conjunction with 
many universities, 25 public master files have been published in the 
Federal Register providing approval for drug use in minor species. 
Currently, 24 active research projects are being conducted in 15 states 
involving 18 animal species and 17 different drugs. Whereas a total of 
299 animal drug requests have been submitted to the program since 1983, 
program funding has been available for only about one out of every five 
requests. In 1998, four FDA reviews were completed and will be 
published as Public Master Files. They were tilmicosin for the 
treatment of chronic respiratory disease in sheep; clorsulon for the 
treatment of hepatic disease caused by Fasciola hepatica; long-acting 
oxytetracycline in sheep for bacterial pneumonia; and ivermectin 
injection for the treatment of Ostertagia ostertagia in American bison. 
Through this safe and efficient process, consumers can be assured that 
human health is not jeopardized in any way. Moreover, the Minor Use 
Animal Drug Program has averaged only $200,000 in Federal funding for 
each of the drugs that have been approved for minor species. The Center 
for Veterinary Medicine of the Food and Drug Administration is 
cooperating and supporting this program to the fullest extent. The 
program is a prime example of Federal interagency cooperation in 
coordination with academic institutions, pharmaceutical industries, and 
commodity interests to effectively meet an urgent need.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from appropriated funds in the 
amount of $240,000 per year for fiscal years 1982-1985; $229,000 per 
year for fiscal years 1986-1989; $226,000 for fiscal year 1990; 
$450,000 for fiscal year 1991; $464,000 per year for fiscal years 1992 
and 1993; $611,000 for fiscal year 1994; and $550,000 per year for 
fiscal years 1995-1999. A total of $6,841,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $156,099 state appropriations, $29,409 industry 
contributions and $11,365 miscellaneous in 1991; $265,523 state 
appropriations, $1,182 product sales, $10,805 industry contributions, 
and $59 miscellaneous in 1992; $212,004 state appropriations, $315 
industry contributions, and $103 miscellaneous in 1993; $157,690 state 
appropriations and $7,103 miscellaneous in 1994; $84,359 state 
appropriations in 1995; $191,835 non-federal support in 1996; $357,099 
non-federal support in 1997; and $104,596 state appropriations and 
$97,375 industry contributions in 1998.
    Question. Where is this work being carried out?
    Answer. The grants have been awarded to the four regional animal 
drug coordinators located at Cornell University, the University of 
Florida, Michigan State University, and the University of California-
Davis, and to program Headquarters at Cornell University. Research is 
conducted at these universities and through allocation of these funds 
for specific experiments at the State Agricultural Experiment Stations, 
the Agricultural Research Service, the U.S. Department of Interior, and 
in conjunction with several pharmaceutical companies.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Selected categories of the Special Research Grants program 
address important national/regional research initiatives. The overall 
objectives established cooperatively with FDA and industry remain 
valid. However, specific objectives continually are met and revised to 
reflect the changing priorities for FDA, industry, and consumers. 
Research projects for this program have involved 20 different animal 
and aquaculture species with emphasis given in recent years to research 
on drugs for the expanding aquaculture industry and increasing number 
of requests from the sheep, veal calf, and game bird industries. The 
program involves research on biological systems that by their nature 
are ever changing and presenting new challenges and/or threats to 
agriculture. Especially with the new sensitivities about food safety 
and environment protection, there is a high priority for continuation 
of these ongoing projects.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency conducted a formal review of the Minor Use 
Animal Drug Program in 1997. An external review team of experts 
representing animal drug research and development, the veterinary 
profession, the pharmaceutical industry, and academia found the program 
to be very productive. Recommendations from the review included: (a) 
improve the visibility of the Minor Use Animal Drug Program, (b) 
improve working relationships with the veterinary and pharmaceutical 
communities, and (c) acquire additional support for the program by 
pharmaceutical companies, universities, and the Federal government to 
meet the identified national needs with emphasis on responsiveness to 
industry needs and food and environmental safety. Annually, grant 
proposals are scientifically peer reviewed, and twice a year the agency 
and program representatives meet with the Food and Drug Administration 
representatives to evaluate progress and to prioritize research 
requests. Workshops are held periodically to identify priorities for 
the program whereby producers, pharmaceutical companies, FDA, and 
researchers participate.
                      molluscan shellfish, oregon
    Question. Please provide a description of the research that has 
been funded under the Molluscan Shellfish grant.
    Answer. The research under this program was initiated in fiscal 
year 1995. A germplasm repository for molluscan shellfish was 
established and is serving as a source of genetic material for genetic 
improvement of cultured shellfish stocks. A broodstock selection 
program was implemented in partnership with industry and is currently 
evaluating selected families for commercial production. This repository 
was also used to establish a population of tetraploid pacific oysters 
for use in the production in triploid oysters and has established a 
population of Kumamoto oysters. The proposal is put though the 
university's peer review process and is reviewed by the CSREES Program 
Manager.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The researchers indicate that there is a national need for 
a molluscan broodstock development program to benefit the commercial 
industry through conservation, genetic manipulation, and wise 
management of the genetic resources of molluscan shellfish.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals of this research program are to establish a 
repository for molluscan shellfish germplasm, to establish breeding 
programs for commercial production of molluscan shellfish, and to 
establish a resource center for the industry researchers and other 
interested parties in the U.S. and abroad. The oyster broodstock 
selection program was implemented in partnership with industry and 
performance trials of selected stocks continue at commercial sites. 
Tetraploid oysters are being produced for use in the production of 
triploid seedstock to be used in commercial production trials. A 
temperature-controlled algae culture facility has been constructed to 
provide adequate nutrition to the oysters used in the studies. Oyster 
broodstock conditioning systems have been developed. Approximately 150 
families have been produced from wild broodstock, and these are 
currently being evaluated at commercial grow-out sites in Alaska, 
Oregon, California, and Washington.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1995 
with an appropriation of $250,000; fiscal year 1996 was $300,000; and 
fiscal years 1997 through 1999 was $400,000. A total of $1,750,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates a total of $135,454 of non-federal 
funding in fiscal year 1995 primarily from state sources; in fiscal 
year 1996, 1997, and 1998 no cost sharing was provided.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Oregon State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Although the specific research objectives outlined in the 
original proposal were to be completed in 1996, researchers anticipated 
that the original broad objectives would be completed in 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES Program manager evaluates the progress of this 
project on an annual basis. The university is required to submit an 
accomplishment report when the new proposal is submitted to CSREES for 
funding. The 1998 review indicated that the researchers were well 
qualified to conduct the research and work in close cooperation with 
the private sector. The research addresses an important opportunity for 
the industry, and the work complements other research being funded 
though USDA on molluscan shellfish. The 1999 CSREES review will be 
completed within three weeks of submission of the proposal. The 
researchers are asked to the develop a research proposal consistent 
with the National Science and Technology Council's Strategic Plans for 
Aquaculture Research and Development.
                    multi-commodity research, oregon
    Question. Please provide a description of the research done under 
the multi-commodity research program?
    Answer. This research provides agricultural market research and 
analysis to support Pacific Northwest producers and agribusiness in 
penetrating new and expanding Pacific Rim markets for value-added 
products. It examines the potential for increasing the competitiveness 
and economic value-added by Pacific Northwest agriculture through 
improvements in food production, processing, and trade by assisting 
decision makers in developing economic and business strategies. The 
grant is not competitively awarded at the state or regional level, but 
the proposal is merit reviewed at the Experiment Station and the 
departmental levels.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher states that Oregon and other 
Pacific Northwest States produce a wide variety of agricultural 
commodities and products with commercial potential for export to 
Pacific Rim countries. Research and analysis are necessary to guide 
agricultural producers and processors in assessing markets and 
developing market strategies and value-added products, and in 
developing marketing strategics tailored to specific Pacific Rim 
markets. The principal researcher believes this research to be of 
national, regional and local need.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. This research is to gain better specific understanding of 
the technical, economic, and social relationships that define Oregon's 
value-added agricultural sector, and examine how these factors affect 
the economic performance of the sector. This project investigates and 
develops innovations in value-added agriculture to improve the economic 
performance of the agricultural and food manufacturing sectors in the 
Pacific Northwest. The current research plan examines the economic 
variables that underlie competition in food production, processing, and 
marketing in the Pacific Rim; addresses technological challenges in 
transportation, storage, and quality maintenance; assists in testing 
and evaluating new product ideas; and monitors economic performance of 
the Oregon value-added agricultural industry. Work in progress has 
resulted in research output in four topic areas: market research, 
packaging research, sensory research, and food processing industry 
strategic planning. Output includes development of a World Wide Web 
site for Pacific Northwest exports, data bases, survey work, and 
collaborative research activity with industry and with institute and 
university researchers in selected Asian countries. Manuscripts, 
working papers, journal articles, and graduate theses are outputs to 
date.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The research began in fiscal year 1993 with an 
appropriation of $300,000. The fiscal year 1994 appropriation was 
$282,000, and fiscal years 1995 through 1999 appropriations were 
$364,000 for each year. The total amount appropriated is $2,402,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funding for this grant was $168,824 in State 
appropriations in fiscal year 1991, $177,574 in State appropriations in 
1993, and $162,394 in State appropriations in fiscal year 1994. This 
project involves the use of Oregon State University administrative 
personnel, equipment, utilities and facilities that are indirect costs 
to the project. These costs constitute an Oregon State University 
contribution to this project which is not allowable as a reimbursable 
expense. Due to a change in university policy regarding indirect costs, 
the university has not reported the amount of non-federal funds 
appropriated for fiscal years 1995-1999.
    Question. Where is the work being carried out?
    Answer. The research is carried out at Oregon State University in 
Corvallis and at the Northwest Food Innovation Center in Portland, 
Oregon.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This Special Grant is awarded on a year-by-year basis. 
Oregon State University traditionally requests funds for this project 
on an annual basis and has budgeted the funds to individual sub-
projects on that basis. Progress on the original objectives is as 
follows: baseline data have been accumulated; an economic growth 
assessment model is being refined; global competitiveness is being 
assessed for value-added Pacific Northwest agricultural products; 
targets for performance are being worked out with agricultural 
industries; and trade teams have been involved in assessing the ability 
of U.S. based industries to meet the demands for noodle production for 
Asian markets. The anticipated completion date is 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES reviews project reports, succeeding annual project 
proposals, research studies, and educational programs. A CSREES merit 
review was dated August 1998. The work was found to be scientifically 
sound and of high priority to the region.
           multi-cropping strategies for aquaculture, hawaii
    Question. Please provide a description of the research funded under 
the multi-cropping strategies for aquaculture research grant in Hawaii.
    Answer. The original goal of this program was to identify and 
develop the sustainable and commercial opportunities inherent in the 
Molokai aquaculture community while maintaining the cultural and 
physical environment unique to Molokai. In fiscal year 1993, the 
university redirected this research program to address the 
opportunities of alternative aquaculture production systems, including 
the ancient Hawaiian fish ponds on the island of Molokai. A community-
based research identification process has been used to identify and 
develop specific research projects and prioritize objectives in this 
program. Current research includes work in the area of water quality 
characterization to accelerate permitting of aquaculture systems. Field 
testing of alternative species is underway. The proposal is placed 
through the university's peer review process and is reviewed by the 
CSREES Program Manager.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researchers indicate that the primary need 
for this research is to assist the native Hawaiians in improving the 
profitability and sustainability of the ancient Hawaiian fish ponds and 
other appropriate aquaculture systems as part of a total community 
development program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this program was to develop technology 
for the co-production of shrimp and oysters in aquacultural production 
systems. Research led to the development of oyster production systems 
that have been field tested under commercial conditions. The overall 
goal of the current project is to identify and develop sustainable and 
commercial opportunities inherent in the Molokai aquaculture community 
while maintaining the cultural and physical environment unique to 
Molokai. Multidimensional field testing and evaluation of existing and 
restored ancient Hawaiian fish ponds is currently underway. Hatchery 
techniques have been developed for the culture of the Pacific 
threadfin, Moi, and seaweed. Techniques for the culture of two edible 
aquatic plants have been refined. Researchers are currently 
characterizing differences in water quality in fish ponds to establish 
criteria for fish pond permitting and management. Current studies 
involve shrimp and ornamental fish production and integration of 
agriculture and aquaculture systems.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. This research was initiated in fiscal year 1987 and 
$152,000 per year was appropriated in fiscal years 1987 through 1989. 
The fiscal year 1990-1993 appropriations were $150,000 per year; 
$141,000 in fiscal year 1994; and $127,000 per year in fiscal years 
1995-1999. A total of $1,832,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university reports a total of $137,286 of non-federal 
funding for this program in fiscal years 1991-1994, $318,468 in fiscal 
years 1995-1996, $116,730 in fiscal year 1997, and $197,000 in fiscal 
year 1998. The primary source of non-federal funding was from state, 
county, and private sources.
    Question. Where is this work being carried out?
    Answer. Research is being conducted through the University of 
Hawaii on the island of Molokai.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The completion date for the original project was 1993. The 
original objectives were met. The specific research outlined in the 
current proposal will be completed in fiscal year 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to provide an accomplishment 
report when the new grant proposal is submitted to CSREES for funding. 
The 1998 review indicated that progress has been made in the 
implementation of the program despite the challenges of developing a 
community-based program in such a unique social and cultural 
environment. Progress in the implementation of the program is well 
documented. The 1999 CSREES review will be completed within two weeks 
of submission of the proposal. The researchers are asked to the develop 
a research proposal consistent with the National Science and Technology 
Council's Strategic Plan for Aquaculture Research and Development.
             national biological impact assessment program
    Question. Please provide a description of the work that has been 
funded under the National Biological Impact Assessment Program grant.
    Answer. The National Biological Impact Assessment Program supports 
the environmentally-responsible use of biotechnology products to 
benefit agriculture and the environment. This grant supports the 
Information Systems for Biotechnology which is a national resource in 
agricultural biotechnology information. This system serves the research 
community by providing information about biotechnology regulations and 
the environmental issues associated with small-and large-scale releases 
of genetically-modified organisms. It provides searchable databases, 
documents, and resource lists on the internet, a monthly News Report, 
custom software to assist in risk assessment and risk management, and 
printed reference materials.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. During the last decade there has been an explosion of new 
information produced by rapid advances in biotechnology and its 
beneficial application to agriculture and the environment. This program 
fulfills an important national need to provide scientists easy access 
to relevant information that will facilitate conducting research that 
complies with the oversight and regulatory requirements for testing 
biotechnology products, and foster the safe application of 
biotechnology to benefit agriculture and the environment. The 
Information System for Biotechnology was the first on-line system to 
address the information needs of the national agricultural 
biotechnology research community, and it continues to be one of the 
most comprehensive sources of information on this topic.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the Program remains in force today: to 
facilitate and assess the safe application of new techniques for the 
genetic modification of plants, animals, and microorganisms to benefit 
agriculture and the environment. Since its inception in 1989, the 
Program has developed tools and resources to provide scientists, 
regulators, teachers, administrators, and the interested public with 
value-added information in a readily-accessible form. It has fostered 
the development of a computer-based information system that has grown 
into an internet site serving more than 4,200 requests per month from 
over 40 countries. The site carries documents pertaining to regulatory 
oversight of biotechnology products, policy statements, and risk 
assessment and risk management information. Searchable databases 
include records of all environmental releases of genetically-engineered 
organisms conducted under authority of the Department of Agriculture, 
institutional biosafety committees, state regulatory contacts, and 
biotechnology research centers and companies. A monthly News Report, 
covering research, regulatory, legal, and international issues, is 
distributed to 1,500 e-mail and 500 print subscribers. In previous 
years, biosafety training workshops were conducted for public and 
private sector scientists and state regulatory officials. Major 
activities now underway include a risk assessment workshop on 
Ecological Effects of Pest Resistance Genes in Managed Ecosystems, to 
be held January 31-February 3, 1999, and publication of ``Greenhouse 
Research with Transgenic Plants and Microbes: A Common Sense Guide to 
Containment,'' a guidebook for safely conducting research in 
greenhouses.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $125,000; fiscal year 1990, $123,000; fiscal 
years 1991-1993, $300,000 per year; fiscal year 1994, $282,000; and 
fiscal years 1995-1999, $254,000 per year. A total of $2,700,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. This program is administered through the Department of 
Biochemistry at Virginia Polytechnic Institute and State University--
VPISU. The university contributes administrative and clerical support 
which amounts to approximately $5,000 per year.
    Question. Where is this work being carried out?
    Answer. The grant award is with VPISU. Former and current partners 
in the program include the Pennsylvania State University, Louisiana 
State University, North Carolina Biotechnology Center, Michigan State 
University, Arizona State University, National Agricultural Library, 
and Institute for Biotechnology Information.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. There remains a continuing critical need to address the 
safety of genetically-modified organisms to benefit agriculture and the 
environment. Application of Biotechnology is expanding rapidly. 
Increasing amounts of new information needs to be properly integrated 
into the computerized information system each year. This program has 
been very successful in providing essential, updated information on the 
conduct of safe field experiments. Thus, the program remains a high 
priority and needs to be continued.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An external panel of scientists reviewed this program in 
1994. The review report was highly complimentary of this project and 
recommended continuation of the program. Another external review and 
site visit is being planned for the year 2000. The current proposal was 
peer-reviewed at VPISU prior to submission.
          nematode resistance genetic engineering, new mexico
    Question. Please provide a description of the work that has been 
funded under the Nematode Resistance Genetic Engineering Project grant.
    Answer. This research is designed to investigate naturally-
occurring compounds from diverse sources that may confer pesticidal 
resistance if introduced into agronomic plants. The main target pests 
are plant parasitic nematodes. The work is using molecular biological 
techniques to incorporate genes into agronomic plants which will 
shorten the time frame to produce transgenic plants. This project was 
not awarded competitively but has undergone peer review at the 
university level and merit review at CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes that the successful 
development of these techniques and subsequence transfer of nematode 
resistant genes into agronomic plants will provide an environmentally-
sound system for all plants susceptible to plant parasitic nematodes. 
The principal researcher believes that this project has the potential 
for both regional and national application.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to provide an 
alternative approach for the control of plant parasitic nematodes 
through the use of molecular biological technologies to transfer 
pesticide resistance to plants. A nematode-stimulated promoter element 
was engineered for insertion in front of a bacteria toxin. A unique 
technique utilizing insect intestinal membrane vesicles were used as 
tools for detection of specific protein binding domains. The synthetic 
gene, CRY3A Bt, has been successful in field trails on potato and 
eggplants.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
and the appropriations for fiscal years 1991-1993 were $150,000 per 
year; $141,000 in 1994; and $127,000 per year in fiscal years 1995-
1999. A total of $1,226,000 has been appropriated thus far.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $65,000 state appropriations in 1991; $62,000 in state 
appropriations in 1992; $75,000 in state appropriations in 1994; and 
$75,000 state appropriations in 1995. For 1996, the University and the 
Plant Genetic Engineering Laboratory provided matching contributions in 
faculty and staff salaries, facilities, equipment maintenance and 
replacement, and administrative support. In 1997, there were no 
matching non-federal funds. In 1998, $48,000 state appropriated funds 
were provided. In 1999, $62,747 is being appropriated in non-federal 
funds.
    Question. Where is the work being carried out?
    Answer. Research is being conducted at the New Mexico State 
University, and at collaborating universities in the region.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives have not as yet been met. The 
estimated completion date for this project is in 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last evaluation of this project was a merit review 
conducted in January, 1998. In summary, the overall goal of this 
project is to use molecular technology to develop pesticide capability 
in plants of agronomic importance. A plant transformation system was 
developed to improve the historically difficult transformation 
efficiently of monocots. In field trails of transformed eggplants and 
potatoes, high levels of effectiveness against insects have been found. 
Several potato and alfalfa lines have been transformed and established 
in field plots and are being tested at this time. Other constructs are 
being used in many crops to determine resistance to nematodes and other 
crop pests.
            nonfood agricultural products program, nebraska
    Question. Please provide a description of the research that has 
been funded under the Nonfood Agricultural Products Program grant.
    Answer. This work focuses on the identification of specific market 
niches that can be filled by products produced from agricultural 
materials, developing the needed technology to produce the product, and 
working with the private sector to transfer the technology into 
commercial practice. Major areas of application include starch-based 
polymers, use of tallow as diesel fuel, improvements in ethanol 
production, use of vegetable oil as drip oil for irrigation wells, 
production of levulinic acid, the extraction of wax from grain sorghum, 
and production of microcrystalline cellulose from crop biomass. The 
Dean and Director of Agricultural Research has initiated a review 
process that parallels the process used for Experiment Station 
projects. Two to three faculty member are asked to critically review 
the proposal using criteria as described by Cooperative State Research, 
Education and Extension Service in the letter soliciting proposals for 
1999.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes our ability to produce 
agricultural commodities exceeds our needs for food and feed. These 
commodities are environmentally-friendly feedstocks which can be used 
in the production of many biochemicals and biomaterials that have 
traditionally been produced from petroleum. The production of the 
commodities and the value-added processing of these commodities is 
regional in scope.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The objectives are to identify niche markets for industrial 
utilization of agricultural products; improve and develop conversion 
processes as needed for specific product isolation and utilization; 
provide technical, marketing, and business assistance to industries; 
and coordinate agricultural industrial materials research at the 
University of Nebraska, Lincoln. Accomplishments include 
commercialization of soybean-based drip oil for irrigation wells. 
Bruning Grain Co. Is marketing ``Soy Bio Drip.'' MCC Technologies, Inc. 
continues to refine the processing requirement and develop a business 
plan for production of microcrystalline cellulose from crop residues 
such as corn cobs, wheat straw, and cellulose via a reactive extrusion 
process developed by the university's Industrial Agricultural Products 
Center. Commercialization activities continue in the area of printable 
plastics. The Center is currently negotiating a royalty position with a 
major producer of smart cards. There are continuing activities with the 
areas of phone cards and credit cards. The Center also is currently 
negotiating a royalty position with a company for the use of 
biodegradable loose-fill packaging technology developed at the Center. 
Various hardness grades of plastic particle media blast using a 
combination of commercially-available biodegradable polymers have been 
produced, and two formulations are currently being tested by U.S. 
Technology Corporation. All of these commercialization projects are the 
result of research efforts, most of which have been supported by the 
Nonfood Agricultural Products Program.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The funding levels for this project are $109,000 in 1990; 
$110,000 per year in fiscal years 1991-1993; $103,000 in fiscal year 
1994; $93,000 in fiscal year 1995; and $64,000 in fiscal years 1996-
1999 per year. A total of $891,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-Federal funding for this project is: in fiscal year 
1992, $315,000; fiscal year 1993, $330,000; fiscal year 1994, $330,000; 
fiscal year 1995, $309,000; fiscal year 1996, $251,000; fiscal year 
1997, $250,000; and fiscal year 1998, $340,000. These funds were from 
Nebraska Corn, Soybean, Wheat, Sorghum, and Beef Boards, World Wildlife 
Fund, Nebraska Bankers Association, United Soybean Board and National 
Corn Growers Association, Bioplastics, Inc., Biofoam, Inc. and M.C.C. 
Technologies, Inc.
    Question. Where is this work being carried out?
    Answer. This work is being conducted at the Industrial Agricultural 
Products Center, L.W. Chase Hall, University of Nebraska, East Campus, 
Lincoln, Nebraska.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The objectives of the original projects have been 
completed. Specific objectives have been identified in each renewal 
request.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project is evaluated based on the annual progress 
report. The cognizant staff scientist has reviewed the project and 
determined that the research is conducted in accordance with the 
mission of this agency.
              oil resources from desert plants, new mexico
    Question. Please provide a description of the research that has 
been done under the Oil Resources from Desert Plants, New Mexico.
    Answer. The Plant Genetic Engineering Laboratory has been exploring 
the potential for the production of high value industrial oils from 
agricultural products. The effort has been focused on transferring the 
unique oil producing capability of jojoba into oilseed rape and 
soybean. With the development of technology to both isolate the enzyme 
components of oil biosynthesis and successfully transform the target 
plants, significant advances have been made with jojoba. In addition, 
oil enzymes have been studied in castor, oilseed rape, desert primrose, 
cyanobacteria, and meadowfoam. A panel of scientists is scheduled to 
re-evaluate the scientific merit of the project on February 9, 1999.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes desert plant sources of 
valuable oils for industrial applications are typically low yielding 
and limited in climatic areas for farm production. Genetic engineering 
offers an opportunity to move genetic capability to high yielding major 
crops. Many of the oils and their derivative acids, waxes, and others 
can directly substitute for imports of similar polymer materials, 
especially petroleum.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the research is to transfer the unique oil 
producing capability of jojoba and other native shrubs into higher 
yielding crops such as oilseed rape and soybean. This is a form of 
metabolic engineering, and it requires the transfer of coordinated 
groups of genes and enzymes into the host plant to catalyze the 
necessary biochemical reactions. Recent progress includes successful 
transformation of tobacco and alfalfa plants with oil metabolism genes 
from the meadowfoam plant and a cyanobacterium.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. This research began in fiscal year 1989 with a $100,000 
grant under the Supplemental and Alternative Crops program. Grants have 
been awarded under the Special Research Grants program as follows: 
fiscal year 1990, $148,000; fiscal years 1991-1993, $200,000 per year; 
fiscal year 1994, $188,000; fiscal years 1995-1996, $169,000 each year; 
and fiscal years 1997 through 1999, $175,000 per year. A total of 
$1,899,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Matching funds in the amount of $27,747 from State and 
private sources were used to help fund this project in fiscal year 
1998. New Mexico State University and the Plant Genetic Engineering 
Laboratory also provide $90,000 for in-kind support per year including 
faculty salaries, graduate student stipends, facilities, equipment 
maintenance, and administrative support services.
    Question. Where is this work being carried out?
    Answer. The research is being conducted by the Plant Genetics 
Engineering Laboratory at New Mexico State University, Las Cruces, New 
Mexico.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. An estimate of the total time in Federal funds required to 
complete all phases of the project is 3-4 years. The application of 
this research for improved management of natural resources will evolve 
and expand as technology in the area advances .
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Oil Resources from Desert Plants, New Mexico project 
was evaluated for scientific merit by an agency peer review panel on 
January 29, 1998. The panel recommended approval of the project pending 
receipt of supplemental information on administrative aspects of the 
project. The Institution conducts an internal peer review of this 
project by scientists with expertise in this area of research. A panel 
of scientists is scheduled to re-evaluate the scientific merit of the 
project for the agency on February 9, 1999.
                 organic waste utilization, new mexico
    Question. Please provide a description of the research that has 
been funded under the Organic Waste Utilization, New Mexico grant.
    Answer. Composted dairy waste is utilized as a pretreatment to land 
application. Composting dairy waste before land application may 
alleviate many of the potential problems associated with dairy waste 
use in agronomic production systems. Composting may also add value to 
the dairy waste as a potential landscape or potting medium. High 
temperatures maintained in the composting process may be sufficient for 
killing enteric pathogens and weed seeds in dairy waste. Noxious odors 
and water content may be reduced via composting. Composted dairy waste 
may be easier to apply, produce better seed beds, and not increase soil 
salinity as much as uncomposted dairy waste. Changes in the physical 
structure of the soil are being monitored for the effects of composted 
vs uncomposted amendments. This project undergoes annual peer review 
from academic institutions and experts from government and state 
agencies, and industrial partners.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the research will address 
the utilization of dairy waste combined with other high-carbon waste 
from agriculture and industry, including potash and paper waste, for 
composting. This approach to waste management will have high impact for 
states where dairy and agriculture are important industry sectors. This 
is especially true for New Mexico and the southwest United States where 
the dairy business is growing rapidly. This research will also provide 
an additional pollution prevention tool for the industrial sectors 
dealing with potash and paper waste. The principal investigator 
believes this research to be of local, regional and national 
importance.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the research was and continues to 
determine the feasibility of simultaneously composting dairy waste from 
agriculture and industry. The research will determine effects of 
utilizing composted waste, as opposed to raw waste, as a soil amendment 
on plant growth, irrigation requirements, and nutrient and heavy metal 
uptake. Phase I, to determine the feasibility of simultaneous 
composting dairy waste with available high carbon wastes from 
agriculture and industry, has been completed. Phase II, to determine 
the appropriate ratios of waste to carbon substrate for successful 
composting is completed. Phase III, to determine the kinetics of 
nutrient release and effects of composted material on heavy metal 
uptake will be completed this year.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1996 
and the appropriation for fiscal year 1996 was $150,000, and for fiscal 
years 1997 through 1999, $100,000 per year. A total of $450,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds for the duration of this grant from 
the state appropriation is $75,000. There is another $50,000 in-kind 
support from the industrial partners. Additionally, a sum of $15,000 
from the New Mexico State Highway Department has been leveraged by this 
project.
    Question. Where is this work being carried out?
    Answer. This work is being carried out in New Mexico under the 
direction of the Waste-Management Education and Research Consortium in 
collaboration with The Composting Council and industrial partners, such 
as Envio in Ohio, Plains Electric, and McKinley Paper in New Mexico.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Completion date of the initial phases will be March 2000. 
Objectives are being met as the project continues. The project has been 
progressing according to the specified targets. Phases I and II have 
been completed. Phase IV has been added in order to evaluate the multi-
year compost application on parameters such as plant growth, soil water 
retention, and soil salinity.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project has been evaluated based on the semi-annual 
progress report and research findings presented at conferences. The 
cognizant staff scientist has reviewed the project and determined that 
this research is conducted in accordance with the mission of this 
agency.
                    pasture & forage research, utah
    Question. Please provide a description of the research that has 
been funded under the Pasture and Forage Research, Utah grant.
    Answer. This is a multidisciplinary effort to develop profitable 
and sustainable pasture and forage management systems. CSREES has 
requested the university to submit a grant proposal that has not yet 
been received.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The proposed research under this Special Research Grant 
will address issues related to forage production and utilization in 
Utah.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this project is to develop a 
comprehensive guide for the management of irrigated pastures to assist 
livestock producers reduce cost and increase net returns.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1997 
and the appropriation for fiscal year 1997 was $200,000, and for fiscal 
years 1998 and 1999, $225,000 per year. A total of $650,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds in support of this project and related 
activities were $360,200 for 1997 and $356,000 for 1998.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at the Utah Agricultural 
Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigators anticipate the completion date 
for these objectives to be in 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The grant is peer reviewed annually through the 
institutions project approval process as well as by CSREES National 
Program Leader.
                peach tree short life in south carolina
    Question. Please provide a description of the research that has 
been funded under the Peach Tree Short Life in South Carolina grant.
    Answer. Progress continued in 1998 with focus on the evaluation and 
longevity and productivity of Guardian rootstocks on peach tree short 
life sites in the southeast and replant sites throughout North America. 
More fundamental work has involved the biochemical characterization of 
the egg-kill factor produced by a bacteria on nematode eggs. Other 
basic studies involved the cloning of genes associated with production 
and expression of toxins from bacteria. New studies were initiated on 
the use of solarization to reduce nematode populations for peach tree 
replant. This project was not awarded competitively but has undergone 
peer review at the university level and merit review at CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. According to the principal researcher, the problem of 
disease on peach, nectarine, and plum trees in the southeastern United 
States effects is very great. More than 70 percent of peach acreage in 
the southeast is effected. Research continued on the improvement of 
rootstocks and the use of the cultivar Guardian BY520-9 which has now 
been released in 22 states including California, New Jersey, and 
Michigan where bacterial canker is a problem.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research was the continued evaluation of 
productivity of peach Guardian BY520-9 rootstocks on peach tree short 
life and investigations into novel management for ring nematodes by 
bacteria. Recent accomplishments include the increase in bulk 
commercial production of Guardian seed while two new Guardian 
selections have had very good nursery trails. Guardian rootstock 
continues to be tested in 22 states and is performing well. A marker 
for a gene for rootstock resistance to two root-knot nematode species 
was sequenced and successfully use to correctly sort current commercial 
rootstocks according to their known nematode resistance or 
susceptibility. A major find is that the egg-kill factor produced by 
the bacteria kill root-knot nematode eggs as well as ring nematode 
eggs.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1981, $100,000; fiscal years 1982-1985, $192,000 
per year; fiscal years 1986-1988, $183,000 per year; fiscal year 1989, 
$192,000; fiscal year 1990, $190,000; fiscal years 1991-1993, $192,000 
per year; fiscal year 1994, $180,000; fiscal years 1995-1999, $162,000 
per year. A total of $3,365,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources for this grant were as 
follows: $149,281 state appropriations in 1991; $153,276 state 
appropriations in 1992; $149,918 state appropriations in 1993; $211,090 
state appropriations in 1994; $193,976 in state appropriations in 1995; 
$169,806 in state appropriations in 1996 and 1997; $150,693 in state 
appropriations in 1998; and $92,099 in state appropriations in 1999.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at South Carolina 
Agricultural Experiment Station.
    Question. What as the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The researchers anticipate that the work may be completed 
in fiscal year 2000. Adequate progress has been made to assure that the 
objectives will be met before the completion date.
    Question. What was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last agency evaluation of this project was a merit 
review completed January, 1998. In summary, the evaluation of peach 
rootstocks with resistance to peach tree short life is of continued 
importance in managing this disease. The use of biological control 
strategies in suppression of plant parasitic nematodes are a 
complementary area of research in that it can enhance disease 
management by protecting the peach rootstocks. Solarization of orchard 
sites prior to peach tree replanting significantly altered the 
microbial community and suppressed nematode multiplication in the 
rhizosphere. Some accomplishments were the increased production and 
release of commercial Guardian seed and continued evaluation of 
rootstock in 22 states and provinces. A molecular techniques that 
separates resistant and susceptible peach rootstocks was validated.
               pest control alternatives, south carolina
    Question. Please provide a description of the research that has 
been funded under the Pest Control Alternatives grant.
    Answer. This grant supports research and technology transfer to 
provide growers with alternatives for managing pests and to implement 
the use of new alternatives reducing the sole reliance on chemical 
pesticides.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The investigators contributing to the research and 
technology transfer at South Carolina believe that need for the 
development of alternatives for managing pests on vegetables is a 
regional and national problem. Contributions from the South Carolina 
work are projected by South Carolina to impact vegetable production in 
the Southern region and consumers of vegetable production from the 
Southern region. Research on pest management alternatives of national 
significance could potentially be supported by competitive grants 
awarded under the Pest Management Alternatives Program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this program is to investigate alternative 
methods of managing insects, plant diseases, and nematodes in vegetable 
crops as complements to or as substitutes for conventional chemical 
sprays. The role of indigenous predators, parasites, and pathogens in 
controlling insect pests are being evaluated. Technology transfer to 
conventional and Integrated Pest Management--IPM--systems has resulted 
in modified thresholds for caterpillar pests in collards and tomatoes 
which incorporate the impact of beneficial insects in the system and a 
sampling plan for tomato fruitworm which considers numbers of 
parasitized eggs used to schedule insecticide sprays. Several vegetable 
crops have been successfully grown without chemical insecticides. 
Refinements in field scouting techniques for insect pests of cole crops 
has translated into reliable treatment decisions--using microbial 
materials--with substantial savings in time required for field 
scouting. Biological control agents have been isolated, identified, and 
used in tests to demonstrate their potential in reducing dependence on 
chemical insecticides. The value of indigenous biological control 
agents has been demonstrated. The impacts of these against target pests 
have been shown along with the adverse effects of chemical insecticides 
on these natural control agents--especially predators and parasites. 
There are now crops--cole crops, for example--for which the use of 
chemical insecticides is avoided altogether, with no loss in yield and 
quality. However, other crops--e.g. tomato, peas, beans--still require 
chemicals for pest control, until alternatives can be found.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work supported by this grant began in fiscal year 1992 
and the appropriation for fiscal years 1992 and 1993 was $125,000 per 
year. In fiscal year 1994 the appropriation was $118,000 and in fiscal 
years 1995 through 1999, $106,000 per year. A total of $898,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. South Carolina has provided approximately $200,000 in 
personnel support and operating dollars per year from State 
appropriations based on the Principal Investigator's estimate.
    Question. Where is the work being carried out?
    Answer. This research and technology transfer program is being 
conducted at the South Carolina Agricultural Experiment Station, 
Clemson University at Clemson, Florence, and Charleston, South 
Carolina.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives of the project were for five years. 
The project has been revised in 1998. Research on objective A: Develop 
and evaluate microbial pest control agents for control of plant 
pathogens and insect pests of vegetables, is defuse and non-conclusive. 
It would be far superior for continued work in this area to be 
submitted to competitive peer review programs where the investigators 
would need to clearly focus specific activities and receive the benefit 
of the comments of peer scientists. Objective B: Determine the efficacy 
of innovative cultural practices for vegetable production systems in 
South Carolina. Objective C: Assess the role of indigenous predators, 
parasites, and pathogens in controlling insect pests; determine 
environmental and biological factors that influence the abundance and 
distribution of these indigenous beneficials; and consider the presence 
of natural enemies, as well as pests, in management decisions, is the 
area where the most progress appears evident and has been cited in the 
accomplishments. We feel that the base of information and orientation 
of the research in this area is adequate and of quality that the 
investigators could compete well in competitive grant programs such as 
sustainable agriculture or regional IPM grant programs, and would 
benefit from the peer review process. Progress in this area is an 
ongoing process as explanations are sought for the results being 
obtained. Objectives D: Evaluate and develop germplasm, breeding lines 
and cultivars for resistance to major pathogens of commercially 
important vegetables. Objective E: Transfer new technology to user 
groups, has not demonstrated any progress that would not be anticipated 
from ongoing conventional sources of funds.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We evaluate this project annually when we process the grant 
and plan to evaluate this project through a site visit during early 
summer of 1999.
                  pesticide impact assessment program
    Question. Please provide a description of the research that has 
been funded under the Pesticide Impact Assessment grant?
    Answer. Research funded by the Pesticide Impact Assessment 
Program--PIAP--discovers, gathers, publishes, and distributes crop and 
livestock profiles which address the information needs for 
implementation of the Food Quality Protection Act--FQPA. These data 
include the use and effectiveness of pest management alternatives which 
is essential to the maintenance of economically competitive U.S. crops 
and livestock production systems. This program produces and publishes 
crop and livestock production profiles which are documents that 
evaluate the biologic and economic impact, implications and 
consequences of replacing existing pest management options with 
alternatives. By coordinating PIAP data collections in conjunction with 
the survey activities of the National Agricultural Statistic Service--
NASS--and the Agricultural Marketing Service's--AMS--Pesticide Data 
Program, special pest management information needs of small acreage and 
minor crop farmers are better served.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. This program provides the U. S. Environmental Protection 
Agency--EPA--and USDA with information on the use, importance, and 
effectiveness of pest management alternatives essential to U.S. 
agricultural crops and livestock production. This program, in 
responding to the information needs of the EPA, is supporting the 
national implementation of the FQPA. In recent years, a special focus 
of the PIAP has been directed into minor crop production systems. To 
ensure relevance and focus on minor crops, this program solicits pest 
management needs assessments from producers, gathered by the NASS, 
Land-Grant University System scientists, and the Department's Office of 
Pest Management Policy--OPMP. The EPA uses these data in making 
environmentally-sound regulatory decisions. The USDA uses scientists 
from the Land-Grant University System to identify commodities where 
critical pests threaten the production system, for FQPA risk 
assessments, and for identification of risk management options for 
specific production systems. Through this cooperative interaction, USDA 
and EPA receive state-generated agricultural information needed for 
sound regulatory decisionmaking. The state partner receives Federal 
funds, participatory input into the regulatory process, and direct 
access to timely regulatory information.
    Question. What was the original and current goal of this research 
and what has been accomplished to date?
    Answer. The PIAP has been an on-going research effort whose 
original goal in 1977 was to gather data to provide comprehensive 
assessments documenting the probable impact on agriculture if certain 
pesticides would no longer be available. A Federally-coordinated 
network of state scientist contacts has been established in the 
intervening years as broader and more environmentally-enlightened goals 
evolved within this program. Today the PIAP goals are defined as: (1) 
to focus on the collection and delivery of high quality science-based 
pest management information for use in the regulatory process; and (2) 
to maintain and enhance a strong partnership between USDA and the Land 
Grant System in order to continue the positive interactive flow of 
vital pest management information between USDA, the regulatory 
community, and production agriculture.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1977-1981, $1,810,000 per year; fiscal years 
1982-1985, $2,069,000 per year; fiscal years 1986-1988, $1,968,000 per 
year; fiscal year 1989, $2,218,000; fiscal year 1990, $2,437,000; 
fiscal years 1991-1993, $2,968,000 per year; fiscal year 1994, 
$1,474,000; and fiscal years l995-1999, $1,327,000 per year. A total of 
$44,898,000 has been appropriated since fiscal year 1977.
    Question. What is the source and amount of the non-federal funds 
provided by fiscal year?
    Answer. The majority of the cost of the state scientist and the 
PIAP program is born by the state partner. The exact contribution of 
each state is not known, nor has this information been requested to be 
reported by the states to the Federal partner during the duration of 
this program. The Federal program funds provided to the states by 
CSREES have been used by state partners to partially defray their costs 
of staffing a PIAP State Liaison Representative on their Land Grant 
campus. The remaining program expenses, above the Federal contribution, 
are born by each state and include the cost of program participant 
salaries, facility/clerical expenditures, travel, and supplies. These 
costs, several times beyond the Federal contribution, are considered 
the non-federal support for this program. The size of the state 
contribution varies from state to state, but estimates of matching 
support for this program range from 3 to 6 times the Federal dollar 
investment.
    Question. Where is this work being carried out?
    Answer. Work on the PIAP is underway at State Agricultural 
Experiment Stations in 50 states and 5 Territories. The distribution of 
competitively-awarded PIAP Regional Grants is coordinated through the 
Agricultural Experiment Station in a lead state in each of the four 
regions of the United States: namely, California in the western region; 
Michigan in the north central region; Pennsylvania in the northeastern 
region; and Florida in the southern region.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The PIAP has been an on-going research effort which gathers 
relevant pest management information necessary for the changing 
regulatory scene. A Federally-coordinated network of state scientist 
contacts has been developed to address the information needs of the 
regulatory community. With leadership from OPMP, this multi-agency 
program coordinates the gathering of high quality pest management 
information from our State partners. The combined data needs of FQPA, 
EPA, and The Government Performance and Results Act--GPRA--have 
resulted in a growing need for accurate and timely pest management 
information in 1999. Thus, the original 1977 objectives of the PIAP 
have been met but the information needs of production agriculture and 
U. S. citizen's continue to grow with the empowering regulations of new 
legislation which require the continuation of these activities to 
demonstrate responsible and responsive federal engagement on pesticide 
issues.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A comprehensive evaluation and review of the PIAP was 
conducted in February 1995. The review panel's report was published in 
June 1995. The review team was composed of 10 scientists representing 
EPA, Industry, agricultural commodity groups, the Federal government, 
and the Land Grant System. This thorough review directed the program to 
focus on data collection relating to pesticide usage on minor crops, 
the efficacy of pest management alternatives, and issues responsive to 
stakeholder's needs. In response to these recommendations, CSREES 
brought together the programmatic and budgetary components of the 
program into a single coordinated PIAP effort. During fiscal year 1999, 
OPMP enhanced it's leadership input to this program focusing on 
information which supports the timely and rational implementation FQPA.
                      pest management alternatives
    Question. Please provide a description of the research that has 
been funded under the Pest Management Alternatives special grant.
    Answer. This special research grant supports projects that help 
farmers respond to the environmental and regulatory issues confronting 
agriculture. These special grant funds support research that provides 
farmers with replacement technologies for pesticides that are under 
consideration for regulatory action by the Environmental Protection 
Agency--EPA--and for which producers do not have effective 
alternatives. The passage of the Food Quality Protection Act of 1996--
FQPA--makes this special research grant of critical importance to the 
Nation's farmers.
    New pest management tools are being developed to address critical 
pest problems identified by farmers and others in a crop production 
region, and to identify new approaches to managing pests without some 
of the most widely used pesticides. Farmers have identified the lack of 
effective alternative pest management tactics as a primary reason for 
not implementing Integrated Pest Management--IPM--on their farms. Where 
effective alternative tactics have been developed, they are widely and 
rapidly implemented by farmers. These special research grant funds are 
distributed on a competitive basis to all eligible research 
institutions through the Pest Management Alternatives Program or PMAP. 
Research priorities for PMAP are established with the help of a 
database analysis system, which draws upon the expertise of the land-
grant university system, commodity groups, and others.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The ability of the Nation's agricultural production system 
to keep pace with domestic and global demand for food and fiber is 
dependant on access to safe, profitable and reliable pest management 
systems. For a variety of factors, farmers and other pest managers have 
fewer chemical control options available to them than they did at the 
beginning of the decade, and this trend is likely to continue at an 
accelerated rate. The FQPA will have significant impacts on pest 
management systems in the United States over the next decade, and the 
``minor use''--high value crops grown on relatively few acres--will be 
particularly hard hit. For these reasons and others, it is essential 
that farmers be provided with new pest management tools and better 
information so they can remain competitive in today's global 
marketplace.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. This research is conducted to help farmers respond to the 
environmental and regulatory issues confronting agriculture by 
providing them with new options for managing pests. The research 
supported by this special grant is identifying new ways to manage pests 
without key pesticides that may no longer be available as FQPA is 
implemented. Some highlights of the research funded through PMAP 
include progress on surface amendments to reduce air pollution by 
Telone, a fumigant; latent infection assessment and fungicide mixtures 
for brown rot control; development of a pesticide use/pesticide 
recommendation database; implementation of alternatives to carbofuran 
for control of rice water weevil; substitution of behavioral control 
for organophosphate sprays against apple maggot; pheromone mating 
disruption in orchards; application technology; and integration of 
natural enemy thresholds for greenbug management in wheat. Progress on 
additional research has been made to collect data on alternatives for 
pest management in watermelon insects and diseases of cucurbit crops in 
the South Central States; on developing IPM and monitoring networks in 
Northeastern vegetation crops; assessment of insecticide and IPM usage 
in alfalfa and small grains; and alternative management practices for 
minor tree fruit crops.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1996 through 1999, $1,623,000 each year. A total 
of $6,492,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds are not required by this grants program.
    Question. Where is the work being carried out?
    Answer. All State Agricultural Experiment Stations, all colleges 
and universities, other research institutions and organizations, 
Federal agencies, private organizations or corporations, and 
individuals are eligible to compete for this funding. This research is 
currently being carried out by State Agricultural Experiment Stations 
and other research organizations located in 20 states.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The economic and environmental pressures facing U.S. 
agriculture today are greater today than in 1996 when Federal funds 
were first appropriated for this special research grant. There will be 
a need for continued investment in research to develop new approaches 
to managing pests for the foreseeable future as the FQPA is 
implemented.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Each new draft of Request for Proposals--RFP--and all 
project proposals are evaluated annually by multi-disciplinary 
relevancy and merit review panels. A joint USDA/EPA workshop to 
evaluate the progress and scope of PMAP is planned for May 1999. The 
projects supported by this special research grant have consistently 
provided key knowledge needed in developing new approaches to pest 
management. The focus on pesticides targeted by FQPA assures that 
critical pest management alternatives are being addressed. PMAP has 
supported 57 projects in 25 States since it started four years ago--
just enough time for the first cycle of projects to be completed. 
Promising results could soon be put into practice in the field.
                   phytophthora root rot, new mexico
    Question. Please provide a description of the research that has 
been funded under the Phytophthora Root Rot grant.
    Answer. Work has continued to focus in general on the development 
of strategies for sustainable vegetable production in irrigated lands. 
Work has continued on the search for Phytophthora root rot resistance 
in chilies, identification of molecular markers for rot tolerant genes, 
investigation on irrigation modification as a means to manage root rot, 
and soil bed temperature control as a means to manage disease. This 
project was not awarded competitively but has undergone peer review at 
the university level and merit review at CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes that since Phytophthora 
disease threatens chili production in west Texas, New Mexico, and 
Eastern Arizona, this problem is of state-and regional significance.
    Question. What is the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to improve chile production through 
genetically-superior cultivars, combined with new improved cultural 
practices. Researchers have developed a highly effective disease screen 
that selects resistant seedlings, found that genes for resistance to 
root rot do not provide protection against Phytophthora foliar blight, 
that a wild species of Capsicum is immune to the fungus, and that 
molecular markers are useful to introgress genes for tolerance. They 
also found that alternate row irrigation and drip irrigation 
significantly reduce Phytophthora root rot. Control of soil temperature 
with soil mulches can greatly impede the progression of root rot in the 
irrigated field.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991 
with an appropriation of $125,000 for that year. The fiscal years 1992-
1993 appropriation was $150,000 per year; $141,000 in fiscal year 1994; 
and $127,000 per year in fiscal years 1995-1999. A total of $1,201,000 
has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds from state appropriations and the 
California Pepper Commission were $255,614 in 1997; $253,614 in 1998; 
and state appropriations in 1999 are $260,682.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at New Mexico State University. 
be to develop educational and outreach material
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
was 1995. These objectives have not been met. Related programs deal 
with research and development efforts designed to prevent or manage 
diseases impacting vegetable production in irrigated areas, and 
cooperators estimate that the objectives of these programs should be 
met by 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last merit review was made in January, 1998. In 
summary, the development of resistant cultivars and research on 
interactions of Capsicum and Phytophthora for developing strategies for 
irrigated crop growers to be competitive in the international economic 
arena continued. More than 30,050 seedlings were screened for 
resistance to root rot and/or foliar blight in the greenhouse. This 
technique allows the resistant plants to be saved and used in the 
breeding program. Field evaluations of advanced lines continued with 11 
green chile lines, 11 red chile lines, 18 advanced paprika lines, and 8 
jalapeno lines were evaluated for released by this program.
         plant, drought, and disease resistance gene cataloging
    Question. Please provide a description of the research that has 
been funded under the Plant, Drought, and Disease Resistance Gene 
Cataloging grant.
    Answer. The purpose of this work is to identify, characterize, and 
catalog important genes in crop plants that result in the ability to 
resist stress caused by drought and disease organisms. The specific 
objectives are: construct, curate, and distribute cDNA libraries for 
genes that are differentially expressed in response to drought or 
disease pressure; sequence DNA of these genes; characterize the pattern 
of expression; and develop databases to share information with other 
scientists.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The long term goal of this research is to improve plant 
resistant to drought and disease for New Mexico and U.S. crops. This 
information has application throughout the nation, especially in the 
arid/semi-arid regions. The principal researchers believe this research 
to be of national, regional, and local need. Genetic research of 
national significance could potentially be supported by competitive 
grants awarded under the National Research Initiative or the Initiative 
for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The long term goal of this research is to produce better 
adapted crops for New Mexico and the U.S. In year one, New Mexico State 
University established the facility, developed a database to catalogue 
cDNAs, and began the initial work of sequencing and cataloging genes 
into biologically informative groups. To date, they have isolated the 
appropriate DNA to construct libraries of drought-stress induced 
transcripts from three different chile genotypes, one grass, and one 
clover. Additionally, they have selected the germplasm to characterize 
for other species.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
and the appropriation for fiscal years 1998 and 1999 is $150,000 per 
year for a total of $300,000.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. In fiscal year 1998, New Mexico Agricultural Experiment 
Station provided $8,444 in nonfederal funds. The funds covered a 
portion of the salary for the two principle investigators.
    Question. Where is this work being carried out?
    Answer. The research is primarily conducted at New Mexico State 
University. Collaborations with Los Alamos National Lab, Los Alamos, 
New Mexico, and the National Center for Genome Resources, Santa Fe, New 
Mexico, have been established.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This project, which began in 1998, was designed to 
demonstrate significant accomplishments within a five-year time frame. 
The principle investigators report significant progress on year one 
objectives.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project began in fiscal year 1998 and the head of the 
Department of Agronomy and Horticulture has established a scientific 
peer review process for this project based on the review tool used for 
Hatch projects at New Mexico State University.
                   postharvest rice straw, california
    Question. Please provide a description of the research that has 
been funded under the Postharvest Rice Straw, California grant.
    Answer. The postharvest rice straw special grant was initiated in 
May 1997 and has two main objectives: first, characterize current 
capabilities, costs, and constraints in harvesting and handling rice 
straw as a renewable material for commercial products; and second, 
investigate alternative harvest and handling systems and evaluate their 
specialized equipment and system designs.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. California legislation mandates reduction in the amount of 
open rice straw burning, the principal method of rice straw disposal. 
Efficient harvest and handling may make rice straw a suitable raw 
material for user businesses while meeting straw burning regulations 
and improving air quality. The principal researcher believes this 
research to be of regional and local need.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to demonstrate efficient and economic rice 
straw harvest and handling, thereby establishing rice straw as a 
feedstock for value-added manufacturing and other uses. This project is 
only recently initiated and is fully organized, including outreach to 
the rice industry.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1997. 
The appropriation for fiscal year 1997 was $100,000 and in fiscal years 
1998 and 1999 was $300,000 per year. A total of $700,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The California Rice Industry Association and the California 
Rice Research Board are potential supporters. The University of 
California at Davis is cost sharing on salary of the investigators.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at the Department of Biological 
and Agricultural Engineering, University of California-Davis, 
California and at field sites in the rice growing region
    Question. What was the anticipated date for the original objectives 
of the project? Have those objectives been met? What is the anticipated 
completion date of additional or related objectives?
    Answer. It is anticipated by the University of California-Davis 
that the postharvest rice straw project will be complete in 2002. The 
project is on track for the objectives pertaining to current equipment 
assessment, economic and systems modeling including geographical 
information systems, and environmental issues.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The evaluation of the projected was completed at the end of 
January 1999 based on the 1998 summary of accomplishments.
                            potato research
    Question. Please provide a description of the research that has 
been funded under the Potato Research grant.
    Answer. Scientists at several of the State Agricultural Experiment 
Stations in the Northeast, Northwest, and North Central States are 
breeding new potato varieties, high yielding, disease and insect 
resistant potato cultivars adapted to the growing conditions in their 
particular areas, both for the fresh market and processing. Research is 
being conducted in such areas as protoplast regeneration, somoclonal 
variation, storage, propagation, germplasm preservation, and cultural 
practices. Congressional language for fiscal years 1997, 1998, and 1999 
has directed CSREES to award these funds on a competitive basis. In 
1997 and 1998, CSREES published a request for proposals in the Federal 
Register and awarded grants competitively based on a scientific peer 
review; the number of grants were eight in 1997 and ten in 1998.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes this research effort 
addresses needs of the potato producers and processors. Research areas 
being studied include storage and postharvest handling of potatoes and 
their effect on potato quality. Potato producer and processor needs are 
breeding and genetics, culture factors, and pest control on potato 
production.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to improve potato production through 
genetics and cultural practices as well as improve storage for quality 
potatoes for processing and fresh market. This research has resulted in 
a number of new high yielding, good quality, disease and insect 
resistant cultivars, which are now being used in the processing 
industry and in the fresh market. Regional comprehensive breeding 
programs have been developed to produce cultivars targeted to the 
specific growing conditions of that region. A number of the new 
cultivars have also been adaptable to other regions. These programs 
have also had success in identifying resistance to pests and pathogens 
in wild germplasm and are developing expertise to incorporate genetic 
engineering approaches as traditional components of the program.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1983, $200,000; fiscal year 1984, $400,000; fiscal 
year 1985, $600,000; fiscal years 1986-1987, $761,000 per year; fiscal 
year 1988, $997,000; fiscal year 1989, $1,177,000; fiscal year 1990, 
$1,310,000; fiscal year 1991, $1,371,000; fiscal years 1992 and 1993, 
$1,435,000 per year; fiscal year 1994, $1,349,000; fiscal years 1995 
through 1998, $1,214,000; and fiscal year 1999, $1,300,000. A total of 
$17,952,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $401,424 state appropriations, $4,897 product sales, 
$249,830 industry, and $30,092 miscellaneous in 1991; $567,626 state 
appropriations, $6,182 product sales, $334,478 industry, and $44,323 
miscellaneous in 1992; $556,291 state appropriations, $9,341 product 
sales, $409,541 industry, and $44,859 miscellaneous in 1993; $696,079 
state appropriations, $21,467 product sales, $321,214 industry, and 
$226,363 miscellaneous in 1994; $935,702 state appropriations, $35,376 
product sales, $494,891 industry, and $230,080 miscellaneous in 1995; 
and an estimated $900,000 state appropriations, $10,000 product sales, 
$400,000 industry, and $200,000 miscellaneous in each of 1996, 1997 and 
1998.
    Question. Where is this work being carried out?
    Answer. The research work is being carried out at the Cornell, 
Idaho, Maine, Maryland, Michigan, North Dakota, Oregon, Pennsylvania, 
and Washington State Agricultural Experiment Stations.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was initiated to accomplish significant results 
in about five years. Because the research is based on genetic varietal 
development, progress is developing new potato varieties takes from 5 
to 10 years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Beginning in fiscal year 1997, these funds have been 
awarded on a competitive basis using a scientific peer review. In 
addition, the agency conducts a formal meeting with representatives 
from the potato industry to review research needs and provide input to 
the agency on the merits of the proposals.
                    precision agriculture, kentucky
    Question. Please provide a description of the research that has 
been funded under the Precision Agriculture, KY grant.
    Answer. CSREES has requested the university to submit a grant 
proposal that has not yet been received. Research will evaluate site-
specific practices for production of corn and soy beans under field 
conditions. The work will compare various combinations of management 
practices using site-specific technology and evaluate economics of its 
application.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The need for this research is to provide objective 
information about precision agriculture technologies to assist farmers 
in the development of management systems that are productive, 
economical, and environmentally benign.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research is to evaluate site 
specified technologies and develop recommendations for their use in 
crop management systems.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The supported by this grant begins in fiscal year 1999 and 
the appropriation for fiscal year 1999 is $500,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. This is a new project which has not yet begun and, 
therefore, no non-federal funds have been used.
    Question. Where is this work being carried out?
    Answer. The research will be conducted at the Kentucky Agricultural 
Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for this project is 2003.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project will be evaluated upon receipt of the required 
grant proposal.
                   precision agriculture, mississippi
    Question. Please provide a description of the research that has 
been funded under the Precision Agriculture, MS grant.
    Answer. CSREES has requested the university to submit a grant 
proposal that has not yet been received. This research will evaluate 
the use of site-specific technology and assess the economics of its 
application. Cultural practices will be studied and integrated into a 
management system using site-specific technology to monitor yield and 
variable rate application. This project will expand on work conducted 
under the Special Technology Special Research Grant funded at $350,000 
in fiscal year 1997 and $600,000 in 1998.
    Question. According to the research proposal, or the principal 
researcher, why national, regional or local need for this research?
    Answer. The need for this research is to provide farmers with 
unbiased information on the application and economics of site specific 
technologies for cotton production in the mid-south.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to evaluate site 
specific technologies and develop recommendations for management 
decisions related to fertilization, pest control, and other cultural 
practices.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $1,000,000.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The non-federal funds provided for this grant are $620,300.
    Question. Where is this work being carried out?
    Answer. The research will be conducted on various Mississippi 
Agricultural Experiment Station branch locations around the state.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The Principle Investigators anticipated the completion date 
for the original objective to be in fiscal year 2004.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project was subject to an initial evaluation at its 
start in fiscal year 1998.
                    pre-harvest food safety, kansas
    Question. Please provide a description of the research that has 
been conducted under the Pre-Harvest Food Safety, Kansas grant.
    Answer. Longitudinal studies on the fecal shedding of Escherichia 
coli 0157:H7 by cattle on beef cow-calf ranches are being done to 
determine the impact of various routine management practices on the 
shedding rate. The purpose of the research is to develop an 
understanding of the management factors that contribute to the 
incidence of E. coli 0157:H7 in beef cattle. The project also allows 
for a comparison of large vs small cow-calf operations.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for the 
research?
    Answer. The presence of E. coli in beef animals sent to slaughter 
can contribute to the contamination of meat products produced from such 
animals. This has increased the need for control measures that could 
reduce the incidence of such food-borne human pathogens in food animals 
during the production cycle. This type of research has been identified 
as critical by all food animal commodity groups as well as public 
health officials and consumers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to determine the incidence of E. coli 
0157:H7 in large vs small beef cow-calf operations and describe the 
management factors that contribute to or affect the rate of shedding of 
organisms in the feces of such animals. E. coli 0157:H7 has been 
detected in 3.11 percent of monthly fecal samples--n=3152--, with 4.57 
percent of the 2,058 animals having at least one positive sample. Fecal 
shedding was normally transient; only one animal was positive on more 
than one sampling date. In addition, there was a difference in 
prevalence between farms. Sources of drinking water were also examined 
and 3.5 percent of 199 water samples were positive. Management 
practices on the ten farms are being examined to determine if there are 
specific risk factors that can be identified.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1996. 
The appropriations for fiscal years 1996 through 1999 was $212,000 per 
year. A total of $848,000 has been appropriated.
    Question. What is the source and amount of non-federal funds by 
fiscal year?
    Answer. Non-Federal funds have been contributed to this project as 
follows: In fiscal year 1996 non-federal funds provided to this project 
were $150,000 in state appropriations and $91,450 in contributed 
indirect costs; 1997 non-federal funds provided to this project were 
$165,000 in state appropriated funds and $90,300 in contributed 
indirect costs; 1998 non-federal funds provided to this project were 
$175,000 in state funds and 91,500 in contributed indirect costs.
    Question. Where is this work being performed?
    Answer. This research is being conducted at Kansas State 
University, University of Nebraska-Lincoln, and at ranches in Kansas, 
Nebraska, and Colorado.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date was October 1, 1998, for 
the original objectives. However, the project was not initiated until 
several months after the expected date of October 1995 so they should 
finish the original objectives in late spring of 1999. As the project 
has progressed, the Principal Investigator has added other important 
questions to the original research plan and has planned to look more 
closely at management interventions that could help reduce the 
incidence of E. coli shedding in beef cattle. Thus, the project should 
continue for some time after the original expected period of time.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project was evaluated by an on-site visit on October 
28-29, 1997 by CSREES. The project team was doing an excellent job and 
the interactive collaboration was outstanding. The research team has 
also been successful in bringing other participants into the program. 
Also, the project leader provided a very comprehensive written report 
on November 1998, including manuscripts currently under review for 
publication, which has permitted a further assessment of the continued 
progress on this important project.
             preservation and processing research, oklahoma
    Question. Please provide a description of the research that has 
been funded under the preservation and processing grant.
    Answer. Research has focused on the effects of preharvest and 
postharvest factors on the market quality of fresh and minimally 
processed horticultural products, including marigolds, pecans, 
watermelons, and peaches. Researchers are developing harvester 
prototypes for marigold flowers and drying and threshing systems for 
marigold petal drying and separation. A fruit orienting mechanism is 
being developed for incorporation into an on-line grading system. An 
integrated harvesting and postharvest handling system is being 
developed for fresh market and processing market horticultural 
products. Research continues on methods to determine textural 
properties of pecans, determine optimum operating parameters for 
supercritical carbon dioxide and other alternative partial oil 
extraction, and develop and optimize modified atmosphere packaging 
techniques for pecan shelf life extension. fiscal year 1998 funds are 
supporting research through June 30, 2000. CSREES has requested, but 
not yet received, a proposal in support of the fiscal year 1999 
appropriation.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that technological 
improvements in fruit, nut, and vegetable handling systems are needed 
to supply domestic markets and support continued participation in 
international commerce, which is a national need. New environmentally-
friendly processing systems have been developed and are being 
commercialized in Oklahoma, with broad application to numerous crops 
with international marketing potential. Processing systems under 
development for commercial adaptation will support market expansion of 
pecans, affecting product market potential and value regionally. 
Improvements in postharvest handling and processing are necessary to 
support growth of the industry and ensure competitive involvement in 
national and international commerce of horticultural commodities 
uniquely suited for production in Oklahoma. New extraction facilities 
will also have a positive impact on local economies, incorporating a 
new value added processing industry and providing local employment 
opportunities.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the research has been to define the major 
limitations for maintaining quality of harvested fruits, vegetables and 
tree nuts and prescribe appropriate harvesting, handling, and 
processing protocols to extend shelf life and marketability of 
harvested horticultural commodities, thus maintaining profitability of 
production systems and assuring an economic market niche for Oklahoma 
producers and food processors. A systems approach to develop 
complementary cropping, harvesting, handling, and processing operations 
has resulted in development of improved handling systems for cucurbit 
and tree fruit crops. Nondestructive processing systems for partial oil 
reduction of tree nuts have been developed to extend shelf life and 
lower the calorie content for the raw or processed product. Funding has 
been secured for construction of a commercial nut extraction facility 
in Oklahoma, pending successful pilot testing which is underway. 
Technologies and procedures previously developed for cucurbit and tree 
fruit systems are being applied to development of okra, pepper, sage, 
basil, tree nut, sweet corn, and marigold cropping, handling, and light 
processing systems, with a targeted completion date of 2001. Research 
from this project provided the basis for commercial high relative 
humidity storage of peaches and to attract companies to the state to 
construct new value added food processing facilities.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1985, $100,000; fiscal year 1986, $142,000; fiscal 
year 1987, $242,000; fiscal years 1988 and 1989, $267,000 per year; 
fiscal year 1990, $264,000; fiscal year 1991, $265,000; fiscal year 
1992, $282,000; fiscal year 1993, $267,000; fiscal year 1994, $251,000; 
and fiscal years 1995-1999, $226,000 each year. A total of $3,477,000 
has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. State funds have been provided as follows: fiscal year 
1991, $126,900; fiscal year 1992, $209,783; fiscal year 1993, $219,243; 
fiscal year 1994, $308,421; fiscal year 1995, $229,489; year 1996, 
$366,570; fiscal year 1997, $397,881; and fiscal year 1998, $205,662. 
The State also provided $16,100,000 for development of an Agricultural 
Products and Food Processing Center and approximately $2,000,000 to 
staff the facility.
    Question. Where is the work being carried out?
    Answer. This work is being conducted at the Oklahoma State 
Agricultural Experiment Station, in conjunction with ongoing production 
research at the Wes Watkins Agricultural Research and Extension Center 
and the South Central Agricultural Research Laboratories.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. It is expected that ongoing research will be completed in 
2002. Additional related objectives beyond this date would address 
further opportunities for horticulture industry growth and economic 
development.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
A review of the proposal supporting the fiscal year 1998 appropriation 
was conducted on January 16, 1998. The project was evaluated as part of 
a comprehensive CSREES program site review in the fall of 1995, with a 
recommendation by the review team to continue the value-added product 
development.
                        rangeland ecosystems, nm
    Question. Please provide a description of the research that has 
been funded under the Rangeland Ecosystems, NM grant?
    Answer. Current research is focused on the ecology of noxious and 
invasive weeds that are endemic to New Mexico's rangelands. Competitive 
research grants have been awarded that deal with studying the 
physiological and toxicological effects of these weeds on livestock.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local focus for this 
research?
    Answer. Noxious weeds are a serious problem in the southwestern 
United States. About one-fifth of the rangeland in Texas and more than 
one-half in New Mexico is infested to some degree. Under this program, 
researchers are working to develop an integrated weed management 
approach.
    Question. What was the original goal of this research and what has 
been accomplished?
    Answer. Accomplished research led to understanding of broom 
snakeweed and other noxious weeds including a better understanding of 
plant's strategy for invasion and persistence. The primary focus of 
research at this time is addressing the need for an integrated weed 
management approach for noxious weeds, especially broom snakeweed.
    Research is addressing three general areas which are ecology and 
management, biological control, and toxicology and animal health. One 
specific accomplishment is the biological control arena; several plant 
pathogens and insects are proving to be effective in broom snakeweed's 
control.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1989, $100,000; fiscal year 1990, $148,000; fiscal 
year 1991, $150,000; fiscal years 1992 and 1993, $200,000 per year; 
fiscal year 1994, $188,000; fiscal years 1995 and 1996, $169,000 each 
year; fiscal year 1997, $175,000; fiscal year 1998, $185,000; and 
fiscal year 1999, $200,000. A total of $1,884,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $249,251 state appropriations in 1991; $200,110 state 
appropriations in 1992; $334,779 state appropriations in 1993; $302,793 
state appropriations in 1994; $294,451 state appropriations in 1995; 
and an estimated $300,000 in state appropriations in each fiscal year 
of 1996, 1997, and 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at New Mexico State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was initiated in 1989. Currently, additional 
and related objectives have evolved and anticipated completion date for 
these is 2000. Considerable progress has been made on many of the 
objectives. Anticipated completion date of the additional and related 
objectives that have resulted based on the current work would indicate 
another 5 years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Each year the grant is peer reviewed with oversight by an 
administrative executive committee within the College of Agriculture 
and Home Economics at New Mexico State University. Additionally, 
CSREES' senior scientific staff review the progress of the grant. Those 
reviews indicated progress in achieving the objectives.
                  regional barley gene mapping project
    Question. Please provide a description of the work that has been 
funded under the Regional Barley Gene Mapping Project grant.
    Answer. The Regional Barley Genome Mapping Project is a multi-
disciplinary, multi-institutional project to develop a genome map of 
barley. Specific objectives are to: construct a publicly-available 
medium resolution barley genome map; use the map to identify and locate 
loci, especially quantitative trait loci controlling economically-
important traits such as yield, maturity, adaptation, resistance to 
biotic and abiotic stresses, malting quality, and feed value; provide 
the framework for efficient molecular marker-assisted selection 
strategies in barley varietal development; identify chromosome regions 
for further, higher resolution mapping with the objective of 
characterizing and utilizing genes of interest; and establish a 
cooperative mapping project ranging from molecular genetics to breeding 
that will be an organizational model for cereals and other crop plants. 
All funds are awarded on a competitive basis.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes barley breeders 
nationwide need information about the location of agriculturally-
important genes controlling resistance to biotic and abiotic stresses, 
yield, and quality factors in order to rapidly develop new, improved 
cultivars and respond to disease and pest threats. This project 
provides that information along with appropriate molecular markers to 
track these traits through the breeding and selection process.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this project was to develop a 
restriction fragment length polymorphism map for barley and associated 
important genetic traits to provide closely linked molecular markers 
for barley breeders. The project has developed comprehensive linkage 
maps defining the entire barley genome in three experimental 
populations and determined the location, number, effect, and 
interaction of genes determining a range of economically-important 
traits. Additionally, the project has supported the development and use 
of an array of genomics tools that are publicly available. Technical 
papers have been published to report results to the scientific 
community.
    Question. How long has this work been under way and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1990, $153,000; fiscal year 1991, $262,000; fiscal 
years 1992-1993, $412,000 per year; fiscal year 1994, $387,000; fiscal 
years 1995-1998, $348,000 each year; and fiscal year 1999, $400,000. A 
total of $3,418,000 has been appropriated.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The nonfederal funds and sources provided for this grant 
were as follows: $203,760 from industry in 1991; $212,750 from industry 
in 1992; $115,000 from industry in 1993; $89,000 from industry in 1994; 
and $35,000 from the State of Washington and $108,000 in other 
nonfederal funding, for a total of $143,000 in 1995. Nonfederal funds 
were $163,000 for 1996 and $178,240 in 1997. In 1998, the project 
received $35,000 from industry.
    Question. Where is this work being carried out?
    Answer. Research is being conducted in the state agricultural 
experiment stations of Oregon, Colorado, Washington, Montana, Idaho, 
North Dakota, Minnesota, New York, Virginia, and California.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objective was to produce a genetic map of 
agronomically-important traits of the barley genome. The anticipated 
time to complete this task was estimated at 10 years with completion in 
1999. The initial goals have been exceeded; however, maps are never 
``done''. The next step will be physical mapping of gene rich regions 
in order to study the genes and understand pathways. Researchers will 
focus on quality and disease resistance.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. In 1998, the special grant proposal was subjected to the 
project approval process at Oregon State University, which is the lead 
university, and reviewed by a CSREES scientist. This project is made up 
of many competitively-awarded mini-grants. A subgroup of the National 
Barley Improvement Committee, which is composed of elected 
representatives of research, growers, and industry, serves as the peer 
panel to review and select proposals based on relevance to the original 
objectives and scientific merit. Multi-disciplinary, multi-
institutional, and continuing projects are given the highest priority. 
The overall project and its mini-grants have been judged to be 
scientifically sound and appropriate for the stated objectives, based 
on comments and rating from peer scientists which is done on each 
support prior to selection.
               regionalized implications of farm programs
    Question. Please provide a description of the research that has 
been done under the program on regionalized implications of farm 
programs grant.
    Answer. The purpose of this research is to estimate the impacts of 
farm, trade, fiscal policies and monetary programs, and assess their 
alternatives on the economic viability of typical crop and livestock 
production operations located in different regions of the United 
States.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. There is a national need for research that provides an 
assessment and evaluation of the potential impacts of Federal farm, 
trade, and fiscal policies on the economic viability and 
competitiveness of farmers located in different regions of the United 
States. Policy impacts vary regionally because of differences in farm 
productivity, input costs, climate, farm enterprises, and size. The 
research results are widely used by farmers and public policymakers 
concerned about minimizing policy and program inequities between 
regions and farm sizes.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original, as well as current, goal was and continues to 
be to provide the farm community, agribusiness groups, and public 
officials information about farm, trade, and fiscal policy implications 
by developing regionalized models that reflect farming characteristics 
for major production regions of the United States. The researchers have 
developed a farm level policy analysis system encompassing major U.S. 
farm production regions. This system interfaces with existing 
agricultural sector models used for farm, macroeconomic, and trade 
policy analysis. The universities have expanded the number and types of 
representative farms to 80. Typical farm models also are being 
developed for Mexico and Canada under a collaborative agreement for use 
in analyzing impacts of the North American Free Trade Agreement.
    Policy studies completed this past year at the request of 
policymakers and farm groups included analyses of the impacts of 
marketing loan provisions on farmers' economic viability; drought on 
farm income and farm viability; early provision of market transition 
payments, risk management accounts; and other crop insurance and 
disaster assistance alternatives.
    Results of these analyses were presented to more than 60 different 
groups across the U.S., including, of course, both congressional 
agriculture committees. The Agricultural Food Policy Center web site, 
which contains copies of all Working and Briefing Papers, was visited 
more than 345,000 times during May-November, 1998 and more than 
2,000,000,000 bytes of information was transferred.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1990 
and the appropriation for fiscal year 1990 was $346,000. The fiscal 
years 1991-1993 appropriations were $348,000 per year; $327,000 in 
fiscal year 1994; and $294,000 in each of the fiscal years 1995 through 
1999. A total of $3,187,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $288,843 State appropriations and $46,773 industry for 
a total of $335,616 in 1991; $45,661 State appropriations in 1992; 
$33,979 State appropriations in 1993; $40,967 State appropriations in 
1994; $161,876 State appropriations in 1995; $187,717 State 
appropriations for 1996; $137,100 for 1997; and $161,400 for 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by the Texas A&M University and 
University of Missouri at Columbia.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This program is of a continuing nature for the purpose of 
assessing the impacts of existing policies and issues and proposed 
policy and program changes at the individual firm level for feed grain, 
wheat, cotton, rice, oilseed, and livestock producers. In addition, the 
representative farms are constantly being updated as farming practices 
change. Currently the researchers are making adjustments for the 
increasing use of Bt and Round-Up Ready seeds.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. No formal evaluation of this project has been carried out; 
however, the CSREES representative is in frequent communication with 
the principal investigator concerning policy analyses procedures and 
studies.
                             rice modeling
    Question. Please provide a description of the research that has 
been funded under the Rice Modeling grant.
    Answer. The purpose of this research project is to develop a 
regional, national, and global rice industry model for use in analyzing 
the impact of changes in domestic and foreign public policies on 
production, trade, stocks, substitute crops, farm prices, and domestic 
as well as global consumption.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Research is needed to assist both the U.S. rice industry 
and national policymakers in assessing the impact of existing and 
proposed changes in public policies for rice. This research enables 
improved analysis of both international and domestic policy changes on 
rice production, stocks, prices of substitute crops, and consumption. 
It has been, and is being used to analyze the impacts of farm policy 
proposals on the U.S. rice industry, to analyze the impact of the World 
Trade Organization and the Uruguay Round agreements on U.S. trade, to 
analyze the impact of emerging rice importing and exporting countries 
on U.S. rice exports, and to analyze the market for different rice 
types--qualities--and seasonal demand and supply factors that affect 
the global rice market. The principal researcher believes this research 
addresses national, regional, and local needs.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to develop 
international, national, and regional models to analyze the impact of 
foreign and domestic policy changes and forecast changes in production, 
trade, stocks, prices of substitute crops, farm prices, and 
consumption.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work actually began about four years ago and federal 
research grants from various sources have totaled roughly $2,000,000 
prior to this year. The work supported by this grant began in fiscal 
year 1996. The appropriation for fiscal years 1996 and 1997 was 
$395,000 per year; for fiscal years 1998 and 1999, $296,000 per year, 
for a total of $1,382,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds over the 4 years prior to this year 
totaled approximately $500,000. For the 1996 fiscal year, state 
appropriations were $178,000; and for 1997 and 1998, $150,000.
    Question. Where is the work being carried out?
    Answer. The research is being carried out at the University of 
Arkansas-Fayetteville and the University of Missouri-Columbia.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The domestic portion of the rice model has been completed. 
The international modeling research is a little over half completed, 
and the researchers estimate another five years is required. The 
purpose of constructing the models, however, is to provide on-going 
analyses of the impact of various policy proposals on the U.S. rice 
industry.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We have conducted no formal evaluation of this project. 
However, annual proposals are peer reviewed for relevance and 
scientific merit. Also, each annual budget proposal is carefully 
reviewed for adherence to stated objectives and annual progress is 
discussed with the principal investigators.
                       rural development centers
    Question. Please provide a description of the research that has 
been funded under the Rural Development Centers Program grant.
    Answer. The overall objectives of the research agenda of the five 
rural development centers are to: Improve economic competitiveness and 
diversification in rural areas; support management and strategic 
planning for economic development; create community capacity through 
leadership; assist in family and community adjustments to stress and 
change; and promote constructive use of the environment. The function 
of the Centers is to increase the productivity of regional faculty both 
in doing research on rural issues and in using that research to do 
effective outreach with rural communities. These projects have 
undergone a merit review.
    Question. According to the research proposal, or one of the 
principal investigators, what is the national, regional or local need 
for this research?
    Answer. The number of research faculty who are addressing broader 
rural issues is declining in many places. The multi-disciplinary, 
multi-state work supported by the Centers becomes even more crucial in 
a period of reduced research emphasis. Critical needs are being met by 
Center support including public lands policy, changing rural migration 
patterns, fiscal alternatives for local-governments, and forest 
stewardship education. Specific needs for regional research are 
reviewed annually by the Centers. The focus of proposals varies from 
year-to-year depending on the shifting priorities of rural clients.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The Rural Development Center mission is to strengthen rural 
families, communities, and businesses by facilitating collaborative 
socio-economic research and extension through higher education 
institutions in the various regions. Research programs are undertaken 
after evaluating broader regional and national priorities. Following 
are some accomplishments of selected research activities conducted 
under the auspices of various centers.
    Industrial recruitment is one of the most popular methods of 
economic development in the northeast U.S. But increasingly the cost 
effectiveness of this strategy is being questioned. More and more, 
communities are capitalizing on an alternative strategy called Business 
Retention and Expansion--BR&E. BR&E seeks to catalyze on local economic 
development efforts by creating a team of local leaders to help the 
community improve its business climate, identify and address 
impediments to growth, and retention of existing businesses. The 
Northeast Center supported the development of BR&E materials that have 
been used in training workshops across the country. Business Retention 
and Expansion International sponsored the workshops. Economic 
development professionals in 31 states in the U.S. and in Canada have 
purchased these BR&E materials to develop programs in their local 
communities to retain and expand existing businesses, and reduce the 
high costs associated with industrial recruitment strategies. The 
materials also have been translated into French and Polish and shared 
internationally.
    A research study funded by the Northeast Rural Development Center 
assessed the consumer credit knowledge of rural poor and ethnic 
minorities and determined their use and management practices. An 
educational program that focuses on the wise use of consumer credit was 
developed and offered to a diverse extension audience. In-service 
workshops also were offered to extension educators in several states in 
the Northeast. Two additional Northeastern states, New York and New 
Jersey, have duplicated the curriculum for distribution to all 
counties. This program was coordinated with and contributed to the 
development of a short video that promotes the MONEY 2000 program, a 
program that encourages participants to save and/or reduce debt by 
$2,000 by the end of the year 2000. The video was distributed widely to 
extension personnel within the region and nation and to financial 
counselors at several military bases.
    University of Rhode Island teamed up to perform a mid-term 
assessment of the MONEY 2000 program that has been operating 
successfully in New Jersey and New York for several years. MONEY 2000 
was created to help families who are living paycheck-to-paycheck and 
struggling with low savings or high household debt. The goal of the 
program is to help participants either reduce debt or increase savings 
by $2,000 by the year 2,000. The analysis will focus on participants' 
behavioral changes and be used to suggest ways extension educators 
could improve the program. Results will be disseminated to state 
project leaders through the national MONEY 2000 listserv. Since it was 
launched in 1996, MONEY 2000 has helped over 7,000 people in more than 
30 states increase their net worth by more that $3,000,000.
    The Southern Rural Development Center partially funded and provided 
all logistical support for a National Conference, ``Linking Family and 
Community Strengths.'' The conference was also supported by CSREES, W. 
K. Kellogg Foundation, Farm Foundation, National 4-H Council and the 
other regional rural development centers. The conference was funded to 
support 12 mini-grant, $1,000 projects that would transform learning at 
the conference to action. One example of outcomes is noted by the 
Virginia report. The grantee used her funding to support the cost of 
providing ``Life in the State of Poverty'' simulation exercise in her 
state. Five social service agencies partnered to present the exercise 
in Fauquier County. Within a week after the activity, people began 
discussing ways ``to repair the community safety net.'' The County 
Administrator took seriously the dialogue of the training. He requested 
the Cooperative Extension Service staff to investigate creation of a 
volunteer coordinator position to track the resources available for 
families dropped from welfare roles. He even pledged county money. Word 
of this activity spread to the Governor's office requesting information 
abut what was happening in the county. A member of the U.S. House of 
Representatives has asked about a visit to Faquier County to observe 
the positive changes taking place. The Virginia Cooperative Extension 
Service, because of involvement in this training, continues to take the 
lead in educating limited resource families to move from self-
sufficiency and to move the community toward support of all families.
    Workers who commute can make important economic, fiscal, and social 
differences in both the county of their residence and the one where 
they work. When people cross state as well as county lines to get to 
work, these impacts can be multiplied. The Western Rural Development 
Center--WRDC--has funded a project to evaluate the effects of workers 
commuting across the Idaho/Wyoming and Nevada/Arizona state lines. The 
Idaho/Wyoming work is further along at this point. In the Idaho 
community 20 percent of the total personal income comes from the 
neighboring Teton county in Wyoming. And the Idaho commuters account 
for 75 percent of the commuters coming into the Jackson, Wyoming 
community. These workers are crossing a very tough mountain pass that 
is frequently closed with slides in the winter. The school, day care, 
housing, and other services are a difficult issue on the Idaho 
communities with very limited tax bases to support the needed services. 
The research is serving as a basis for discussions between the 
communities.
    Using a Western Rural Development Center supported Business R&E 
retention and expansion program, New Mexico State University Extension 
has assisted seven communities expand their economic base by saving and 
creating local jobs. Seven jobs were saved in Silver City when task 
force members facilitated a propane company's move to a new location. 
The Clovis task force intervened with city officials to save a 
$1,000,000 business complex. The R&E staff in Torrance County created 
75 jobs by helping a commercial greenhouse find suitable land. BC Hydro 
in Burnaby, British Columbia recently requested and received permission 
to adapt the Business R&E program materials for use in rural Canada.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1971, $75,000; fiscal year 1972, $225,000; fiscal 
year 1973, $317,000; fiscal years 1974-1981, $300,000 per year; fiscal 
years 1982-1985, $311,000 per year; fiscal years 1986-1987, $363,000 
per year; fiscal year 1988, $475,000; fiscal year 1989, $500,000; 
fiscal year 1990, $494,000; fiscal years 1991-1993, $500,000 per year; 
fiscal year 1994, $470,000; fiscal years 1995-1998, $423,000 per year; 
and fiscal year 1999, $523,000. A total of $10,641,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds available to the four Regional Centers 
for Rural Development were: fiscal year 1991, $1,117,000; fiscal year 
1992, $790,000; fiscal year 1993, $900,000; fiscal year 1994, $776,591; 
and fiscal year 1995, $710,0050; for a total of $4,293,641 across the 
five years for which there are complete data.
    Question. Where is this work being carried out?
    Answer. The regional rural development centers include the 
following. Northeast Regional Center for Rural Development, 
Pennsylvania State University; North Central Regional Center for Rural 
Development at Iowa State University; Southern Rural Development Center 
at Mississippi State University; and Western Rural Development Center 
at Oregon State University. There is also a rural development project 
at North Dakota State University which receives funding from the annual 
Rural Development Centers appropriation. Most of the research sponsored 
by the four regional centers is actually performed by resident faculty 
at land-grant universities in the respective region through 
subcontracts from that center's grant.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives.
    Answer. The regional rural development centers were established to 
provide an on-going ``value added'' component to link research and 
extension and by doing so to increase rural development under the 
special conditions in each region. The work of the Centers is being 
carried out in all 50 states and in some territories. The Centers 
compile a report of annual accomplishments and share those with the 
states in the region. The list of needs is constantly evolving and is 
being addressed through projects that are matched to the constantly 
shifting local agenda. The current phase of the program will be 
completed in 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Centers enlist the help of academic and private/public 
foundations personnel on advisory committees and boards of directors to 
help establish operating rules and provide professional, technical 
counsel and peer evaluation of Center projects and the principal 
investigators. The projects are evaluated annually by the advisory 
committees and the boards of directors against the five key issue areas 
and the objectives of each project for relevance, achievement, and 
initial impacts. Follow-up evaluation is carried out by the Center 
staffs in order to assess long-term impacts of these projects on local 
communities.
                        rural policies institute
    Question. Please provide a description of the research that has 
been funded under the Rural Policies Institute grant.
    Answer. The Rural Policy Research Institute--RUPRI--is a consortium 
of three universities designed to create a comprehensive approach to 
rural policy analysis. The Institute conducts research and facilitates 
public dialogue to increase public understanding of the rural impacts 
of national, regional, state, and local policies on rural areas of the 
United States.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. There is a need to estimate the impacts of changing state 
and national programs and policies on rural people and places. 
Objective public policy analysis can provide timely and accurate 
estimates of the impacts of proposed policy changes to allow more 
reasoned policy discussions and decisions. The principal researcher 
believes this research meets national, regional, and local needs.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of the Rural Policy Research Institute 
was to create a new model to provide timely, accurate, and unbiased 
estimates of the impacts of policies and new policy initiatives on 
rural people and places. The Institute has completed a number of 
successful policy research projects and developed three analytic models 
central to its mission. These projects focus on the rural implications 
of devolution, health care, education, housing, rural development, 
welfare reform, tax and telecommunications policy proposals. In 
addition, the Institute uses expert panels to provide policy decision 
support to a number of policy making groups at national and State 
levels. The expert panels and other collaborative research have, over 
the life of RUPRI, involved 150 scientists representing 16 different 
disciplines in 60 universities, 40 states, and three foreign countries. 
Currently, 50 nationally-recognized scientists and policy practitioners 
from 38 institutions and organizations serve on RUPRI panels, task 
forces, or work groups.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by these grants began in fiscal year 
1991, and the appropriation for fiscal year 1991 was $375,000. The 
fiscal year 1992 appropriation was $525,000; for fiscal year 1993, 
$692,000; for fiscal year 1994, $494,000; and fiscal years 1995-1999, 
$644,000 each year. A total of $5,306,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Aggregated non-federal funds to support the Rural Policy 
Research Institute across the three universities involved include 
unrecovered indirect costs, salary support from university and other 
non-federal sources, and various other grants, contracts, and 
reimbursable agreements. They amounted to $316,458 for fiscal year 
1991; $417,456 in fiscal year 1992; $605,302 in fiscal year 1993; 
$537,834 in fiscal year 1994; $584,516 in fiscal year 1995; for fiscal 
year 1996, $576,782; $186,859 in 1997; $153,614 for 1998; and an 
estimated $168,450 for 1999. Total to date including the 1999 estimate, 
is $3,547,271.
    Question. Where is this work being carried out?
    Answer. The Institute's member universities are: the University of 
Missouri-Columbia; the University of Nebraska-Lincoln; and Iowa State 
University, Ames.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Current funding will sustain activity through January 1998; 
however the original objectives were directed at building a permanent 
policy analytical capability.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We have conducted no formal evaluation, however, annual 
project proposals are peer reviewed for relevance and scientific merit.
                     russian wheat aphid, colorado
    Question. Please provide a description of the research that has 
been funded under the Russian Wheat Aphid, Colorado grant.
    Answer. Funding will support two key areas of research that are 
needed to assure long-term and sustainable Russian wheat aphid 
management. These are: (1) discovering new crop genes which provide 
resistance to the Russian wheat aphid--RWA--and incorporating them into 
commercially-acceptable wheat varieties, and (2) integrating the 
available control tactics into the most effective, efficient, and 
environmentally-sound production systems for the Great Plains.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The Russian wheat aphid is an exotic pest that entered the 
western United States without its normal complement of biological 
control agents. This insect has rapidly become the most important 
insect pest of wheat in the western United States. From 1986-1991 the 
total economic impact was estimated to be in excess of $657,000,000. In 
the same period, some 17,500,000 pounds of insecticides were used 
nationally for Russian wheat aphid control. The cost to American 
farmers of insecticide treatments was over $70,000,000. In addition, 
the intense use of insecticides on a crop that previously received 
little insecticide treatment raised concerns about the impact on water 
quality, human health, food safety, non-target organisms, and general 
environmental quality. Direct losses in Colorado have been as high as 
$27,000,000 in a single year with an average direct loss of above 
$11,000,000 per year, since 1987. Pest management research of national 
significance is supported by competitive grants awarded under the 
Integrated Pest Management program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals of the research are to: (1) discover new crop 
genes which provide resistance to the Russian wheat aphid and 
incorporate them into commercially-acceptable wheat varieties, and (2) 
integrate the available control tactics into the most effective, 
efficient, and environmentally-sound production systems for the Great 
Plains. The techniques of molecular genetics are being employed to 
reach the goal of identifying new genes for resistance to RWA and 
incorporating them into commercially-acceptable wheat varieties. 
Several DNA marker technologies used in other plant species have been 
successfully adapted for mapping RWA resistance genes in wheat. These 
include restriction fragment length polymorphism--RFLP--and amplified 
fragment length polymorphism--AFLP--techniques as well as 
microsatellite markers. RFLP markers were initially used to map two RWA 
resistance genes--Dn4, the one used in the resistant cultivar `Halt' 
and Dn2, an additional resistance gene that might be suitable for 
inclusion in a cultivar containing two resistance genes. Using AFLP, 
researchers have identified a DNA marker that is more tightly linked to 
DN4 than the previously identified closest RFLP marker. Recently, a 
microsatellite marker was identified that is tightly linked to Dn2. A 
combination of several DNA marker technologies is essential for finding 
DNA markers tightly linked to RWA resistance genes in wheat. Finding 
and identifying tightly linked markers are important achievements 
because tight linkages are critical to using this technology to 
expedite the development of RWA resistant wheat cultivars and are 
required for cloning the genes via positional cloning--an essential 
goal of the project. A new RWA resistance gene--Dn7--was identified by 
other researchers in South Africa. The gene comes from rye and is 
contained in a wheat/rye translocation that is carried in a wheat 
background. This material has been obtained and has been crossed with 
susceptible wheat to generate materials for use in molecular genetic 
analysis of Dn7 and to incorporate the gene into wheat. Dn7 is one of 
the resistance genes that is being targeted for molecular cloning in 
the Colorado State University program. Progress has also been made in 
Integrating Tactics for Management of RWA. In 1998, experimental 
dryland cropping systems were established in eastern Colorado. Two of 
these are located in growers fields and have been designed with grower 
input and are managed jointly with the grower-cooperator. Long-term 
studies were initiated to compare the experimental systems with typical 
wheat production systems in the area. The experimental systems were 
designed to optimize the effects of environmentally-sound pest 
management tactics--particularly resistant cultivars, the effects of 
cultural practices [such as planting date, harvesting date, grazing, 
etc.--, and biological control--reducing RWA numbers through the 
actions of predators and parasites. In addition, the experimental 
systems were designed to optimize water use efficiency and other 
agronomic and profitability factors. At each location, wheat and other 
adapted dryland crops are grown in proximity to each other so that 
interactions among various crops and various production practices can 
be studied. Rotations over time of wheat with other crops also are 
being investigated. These large-scale experimental systems will be 
ideal arenas in which to determine the best way to apply the knowledge 
already gained about specific aspects of RWA biology and ecology, 
production practices, and the effectiveness of naturally occurring RWA 
parasites and predators. These large-scale experimental cropping 
systems also will provide valuable information on RWA management to 
wheat growers who are considering adding additional crops to their 
dryland cropping systems.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
and the appropriation for fiscal years 1998 and 1999 is $200,000 per 
year for a total of $400,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year.
    Answer. State appropriations and the Colorado Wheat Administrative 
Committee have demonstrated strong support for this effort. The total 
per year is approximately $775,000 in new funding from the state of 
Colorado and redirected funds from within the university.
    Question. Where is the work being carried out?
    Answer. Research will be conducted on the campus of Colorado State 
University, at Colorado State University research stations, and on the 
farms of cooperators throughout Colorado. Outreach and extension 
activities will be focused on wheat growers in Colorado, Nebraska, 
Wyoming, Kansas, New Mexico, Texas, and Oklahoma.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This is a new project. It is anticipated to continue for a 
total of five years with a completion date of July 2003.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project will be evaluated by a CSREES site visit on 
February 4 and 5, 1999.
       seafood harvesting, processing, and marketing, mississippi
    Question. Please provide a description of the research that has 
been funded under the seafood harvesting, processing, and marketing 
grant.
    Answer. Research related to seafood safety, quality, and by-product 
utilization has been supported by this grant. Funds from the fiscal 
year 1998 grant are supporting research through September 30, 1999. 
CSREES has requested the University to submit a proposal, which has not 
yet been received, in support of fiscal year 1999 funds. For fiscal 
1999, funds will support research on: microbial population changes 
during retail display of shrimp; development of an impedance-based 
method to rapidly detect microorganisms on shrimp; determine physical, 
chemical, microbiological, and sensory differences between pond and 
tank aquaculture tilapia; and evaluate processes for utilization of 
uncooked shrimp processing by-products for production of flavor 
extracts.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes that national needs 
reflected in the project include providing consumers with affordable 
alternative seafood products. Alternative sources of seafood protein 
are needed because of a drastic decline in natural harvests due to 
overexploitation. Other national needs addressed in this project 
include reducing pollution during seafood and aquaculture food 
processing by converting byproducts into value-added food ingredients 
or materials. Regionally, much is unknown about the short-and long-term 
effects of the new seafood Hazard Analysis Critical Control Point--
HACCP--regulations on the livelihood of Mississippi seafood and 
aquaculture food producers and processors who are typically small and 
lack sufficient resources to remain competitive. Continuation of this 
project will provide continued assistance to Gulf-Coast seafood 
processors in meeting new U.S. regulations as well as new international 
regulations that are important for Mississippi export products. 
Locally, catfish processors are a major employer of the severely 
economically depressed Delta region of Mississippi. By further 
enhancing the value of catfish products, this project seeks to improve 
the livelihood of individuals both on the Gulf coast and in the 
aquaculture region of the state.
    Question. What was the original goal of the research and what has 
been accomplished to date?
    Answer. The original goals of the research were to improve the 
quality and safety of catfish and improve the utilization of catfish 
byproducts and underutilized marine species. Due to successes of the 
original project, subsequent efforts are focusing on additional uses of 
seafood and aquaculture foods by improving processing strategies and 
providing alternative products from waste materials. The project has 
thus expanded to include crab, shrimp, oysters, freshwater prawns, 
hybrid striped bass, tilapia, and crawfish. The Food and Drug 
Administration has passed rulings affecting the potential viability of 
Mississippi seafood and aquaculture harvesters and processors; emphasis 
is thus being placed on addressing possible adverse consequences 
resulting from these changes.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1990 
when $368,000 was appropriated for this project. The appropriations for 
fiscal years 1991-1993 were $361,000 per year; fiscal year 1994, 
$339,000; and fiscal years 1995-1999, $305,000 each year. A total of 
$3,315,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The State of Mississippi contributed $1,949 to this project 
in fiscal year 1991; $41,286 in fiscal year 1992; $67,072 in fiscal 
year 1993; $91,215 in fiscal year 1994; $147,911 in fiscal year 1995; 
and $61,848 in fiscal year 1996. Product sales contributed $7,044 in 
1991, $13,481 in 1992, $13,704 in 1993, and $5,901 in 1994. Industry 
grants contributed $14 in 1992 and $31,796 in 1993. Other non-federal 
funds contributed $80 in fiscal year 1991, $838 in 1992, and $17,823 in 
1993. The total non-federal funds contributed to this project from 1991 
through 1996 was $501,962. In fiscal year 1998, $151,286 in state 
funds, $8,790 in self-generated funds, and $23,877 in other non-federal 
funds were obtained.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by scientists in the 
Departments of Food Science and Technology and Agricultural Economics 
of the Mississippi Agricultural and Forestry Experiment Station at 
Mississippi State University and at the Coastal Research and Extension 
Center, Seafood Processing Laboratory, in Pascagoula, Mississippi.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The principal investigators anticipate that research on the 
original objectives will be completed in 1999. Continuing needs by 
Mississippi seafood and aquaculture harvesters and processors related 
to improved quality, safety, and utilization will require research and 
development of new technologies to expand this industry.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An agency science specialist conducts a merit review of the 
proposal submitted in support of the appropriation on an annual basis. 
The last review of the proposal was conducted on April 13, 1998. At 
that time, the agency science specialist believed that the projects 
addressed needs and interests of the regional seafood and aquaculture 
industries.
                          small fruit research
    Question. Please provide a description of the research that has 
been funded under the Small Fruit Research grant.
    Answer. Funding for this special grant has been used to enhance the 
production and quality of small fruits--blackberry, blueberry, 
caneberry, cranberry, marionberry, raspberry, strawberry, and grape in 
the Pacific Northwestern states of Idaho, Oregon, and Washington. 
Research has been focused on crop genetics, production/physiology, pest 
management, berry/grape processing, marketing, and wine production. 
Proposals are selected after examination of their relevance to 
priorities identified within the region.
    Question. According the research proposal, or the principal 
researcher, what is the national, regional and local need for this 
research?
    Answer. There is a considerable demand for fresh and processed 
berry products in the United States. The demand is also high in urban 
Asian markets where consumer interest for berry products is strong. 
Currently, international marketing of Northwest small fruit commodities 
involves the sale of traditional products. Research on international 
consumer preferences, packaging, and products continues to be 
essential. The importance of berry and grape crops to the region has 
long been recognized by the three Northwest states: Washington, Idaho, 
and Oregon. These crops are mainstays of high-value, specialty 
horticulture. The universities and small fruits industry have made a 
strong commitment to the improvement of these crops as evidenced by the 
high level of internally-developed resources for research and 
marketing. Thus, the Northwest Center for Small Fruit Research has 
developed effectively over the last 8-10 years into its present fully 
established form.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. Genetic improvement of small fruit cultivars continues to 
be a powerful tool using germplasm collection and identification, field 
evaluation of new germplasm, and advanced selections from breeding 
programs, virus identification and elimination, and approaches that 
utilize genetic engineering. Research is identifying cultivars and 
developing cultural practices that growers can utilize to reduce crop 
losses. Research is evaluating and investigating nutritional factors, 
cultural management, temperature stress, effects of pruning, micro 
propagation, cold hardiness/low temperature injury, and effects of 
viticulture practices on wine quality of winery processing on wine 
quality. Small fruit research continues to reap acclaim for its 
components involving industry-driven cooperation between industry, 
state, and Federal research. Its genesis as a small-fruits program 
reflects the contributions of plant biology, the commitment to 
facilitating the efficiency of research and the coordination of 
marketing throughout a multi-state region. The Center represents an 
innovative organization which has created a cooperative strategy for 
university, USDA's Agricultural Research Service--ARS--and industry 
small fruit programs.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999.
    Answer. The initial support for this grant was an appropriation in 
fiscal year 1991 for $125,000. The appropriation for fiscal years 1992 
and 1993 was $187,000 per year; fiscal year 1994 was $235,000; fiscal 
years 1995-1998, $212,000 each year; and fiscal year 1999, $300,000. A 
total of $1,882,000 has been appropriated.
    Question. What is the source and amount of non-Federal funds 
provided by fiscal year?
    Answer. This project involves the use of Oregon State University--
OSU--administrative personnel, equipment, utilities and facilities that 
are indirect costs to the project. These costs constitute an OSU 
contribution to this research project, which is not allowable as a 
reimbursable expense under this project. The recent passage of Oregon's 
tax limitation laws reduce revenues that restrict our ability to cost 
share. Thus, our policy is that we do not provide any cost sharing or 
matching funds for this or other agreements in which we receive no 
indirect costs. We are committed to providing the required 
collaborative efforts by Oregon State University scientists and 
administrators to complete the work described in this proposal. And in 
an effort to satisfy the request for a dollar amount for non-Federal 
funds, an approximation could be found by applying CPI values to 
estimate expenditures on this program since 1996.
    Question. Where is the work being carried out?
    Answer. The research is being conducted at Oregon State University, 
Washington State University, and the University of Idaho. Oregon State 
University is the lead institution for this project.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives are still valid researchable 
issues, therefore this is a continuing process with priorities annually 
re-evaluated to appropriately adjust research direction within the 
project objectives.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project evaluation process is accomplished annually by 
peer reviewers whom are chosen and organized by expertise according to 
the five technical working groups with input from the designated 
Agricultural Experiment Station Representatives in Washington, Oregon, 
and Idaho. The Program Administrator in each state contacts possible 
reviewers for each proposal. The chair of the review process annually 
rotate between the Agricultural Experiment Station representatives. 
Each submitted proposal is peer-reviewed by a panel of five 
individuals--three scientists and two industry representatives--and is 
grouped into one of the Center Technical Working Groups, namely 
genetics, pest management, production/physiology, processing/packaging, 
and marketing. Proposals are evaluated on the following criteria: (1) 
the nature of the proposed research and its relevance to the needs of 
the small fruit industries; (2) the relevance of the proposal to 
current small fruit research designated priorities; (3) the scientific 
expertise of the scientists involved--training, experience, and 
accomplishments relative to specific areas of small fruit research; (4) 
the appropriateness of the level of funding requested, vis-a-vis, 
availability of funds; and (5) the likelihood of success. Reviewers 
complete an evaluation sheet for each proposal, rating the five 
criteria on a scale of one to ten, with ten being the best. Previously 
awarded projects are given special consideration in order to allow for 
funding for up to three years--when appropriate progress is 
demonstrated. Compilation of evaluations are distributed to the three 
Agricultural Experiment Station Directors and the USDA-ARS 
Horticultural Crops Research Laboratory Research Leader, who make the 
final determination of funding for each proposed project. Notification 
of awards are made in December. The peer review of all proposals is 
coordinated and processed through the Northwest Center for Small Fruit.
      southwest consortium for plant genetics and water resources
    Question. Please provide a description of the work that has been 
funded under the Southwest Consortium for Plant Genetics and Water 
Resources Program grant.
    Answer. New Mexico State University, Los Alamos National 
Laboratory, Texas Tech University, the University of Arizona, and the 
University of California at Riverside entered into a cooperative 
interdisciplinary research agreement constituted as the Southwest 
Consortium for Plant Genetics and Water Resources to facilitate 
research relevant to crop adaptation to arid and semi-arid regions. The 
overall goal of the Consortium is to bring together multi-disciplinary 
scientific teams to develop innovative advances in plant biotechnology 
and related areas to bear on agriculture and water use in and semi-arid 
regions. All grants made to the participating Institutions are awarded 
competitively by a scientific peer review process.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The Consortium is addressing the need for an integrated 
program that identifies specific problems of southwest agriculture, 
coordinates water and biotechnology research aimed at solving these 
problems, and facilitates the transfer of this information for 
commercialization. The specific research objectives of the Consortium 
include the development of crops with resistance to: drought and 
temperature extremes; adverse soil conditions; and pests and parasites. 
This research is highly significant to national, regional, and local 
needs. Biotechnology research of national significance is supported by 
competitive grants under the National Research Initiative and the 
Initiative for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this Consortium is to facilitate 
research to provide solutions for arid and semi-arid crop adaptation. 
Five participating institutions have developed research plans 
consistent with the Consortium's goals. Mini-grants to support research 
that would solve problems unique to southwest agriculture are awarded 
competitively following peer review. Specific attention is given to 
interdisciplinary agricultural research. Since its inception in 1985, 
the Consortium has provided essential support for the establishment of 
baseline data on new, forward thinking research relevant to the 
improvement of arid lands agriculture. Accomplishments include: 
identification of chromosome regions conferring water use and 
transpiration efficiency in wheat; analysis of the impact of water 
stress on host plant resistance to aphids and whiteflies on melon; and 
evaluation of genetic variation of water-soluble carbohydrates in 
spring wheat and salt-tolerance mechanisms.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1986, $285,000; fiscal years 1987-1989, $385,000 
per year; fiscal year 1990, $380,000; fiscal years 1991-1993, $400,000 
per year; fiscal year 1994, $376,000; and fiscal years 1995-1999, 
$338,000 each year. A total of $5,086,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The Consortium's lead institution, New Mexico State 
University, reports matching non-federal funds of $80,000 in state 
appropriations in 1992 and $100,000 in 1993-1998. Nonfederal funds 
spent on this project originate from the five institutions that 
participate in the Consortium and support researchers' salaries, 
facilities, equipment maintenance, and administrative assistance.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by the member institutions of 
the consortium: New Mexico State University; Los Alamos National 
Laboratory; Texas Tech University; the University of Arizona; and the 
University of California at Riverside.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was initiated in 1986 and accomplished 
significant results in the first five years. Additional and related 
objectives have been developed and anticipated completion date for 
these is 2001. The Consortium is successfully achieving its objectives 
through the funding of new interdisciplinary projects each year.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Mini-grants are awarded competitively to support research 
that would solve problems unique to southwest agriculture. The mini-
grant selection process is competitive. Proposals are evaluated by 
external peer reviewers, the Consortium Steering Committee, and the 
Consortium Scientific Committee. The review process includes: (1) 
preproposal screening by the Consortium Steering and Scientific 
committees; (2) request for proposals sent to those projects with 
preproposals that best meet the Consortium goals; and (3) external and 
internal review of all new proposals. After external and internal 
reviews, awards of up to $50,000 for up to two years of funding per 
project are made. An internal review of a progress report on each 
project is completed before the second year of funding is released.
                    soybean cyst nematode, missouri
    Question. Please provide a description of the research that has 
been funded under the Soybean Cyst Nematode grant.
    Answer. The research being funded by this grant is crucial to the 
development of effective management strategies to understand host 
parasite relationships of the pathosystems and each of its components. 
Work has dealt mainly with identifying Heterodera glycines-resistant 
genes and incorporating them into agronomically-superior cultivars. 
Basic studies elucidate the fundamental biology of the cyst nematode in 
regard to new management strategies. Applied work dealt with evaluating 
production systems and to new management strategies. This project was 
not awarded competitively but has undergone peer review at the 
university level and merit review at CSREES.
    Question. According to the research proposal, or the principal 
investigator, what is the national, regional, or local need for the 
research?
    Answer. The principal researcher believes that although this 
research is focused on the soybean cyst nematodes in Missouri, the 
problems are of regional and national significance. The soybean cyst 
nematode, Heterodera glycines is the most serious pest of soybean in 
the United States. The problems continue to increase in the Midwest 
where 12 states have yield reductions in soybean because of this 
nematode. Due to the nematodes ability to adapt to resistant varieties 
over time, new varieties are continually needed. Genetic research of 
national significance could potentially be supported by competitive 
grants awarded under the National Research Initiative or the Initiative 
for Future Food and Agricultural Systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is managing soybean cyst nematode 
through the various management strategies including the development of 
new resistant soybean varieties. To date, several nematode resistant 
soybean lines have been or will be released. The need for breeding 
soybean lines to develop resistant varieties with a broad spectrum of 
resistance continues. More fundamental research involves the 
utilization of new molecular technologies to identify genes responsible 
for resistance. Other aspects of the work relates to field management 
strategies for these nematodes.
    Question. How long has work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1979, $150,000; fiscal years 1980-1981, $250,000 
per year; fiscal year 1982, $240,000; fiscal years 1983-1985, $300,000 
per year; fiscal years 1986-1989, $285,000 per year; fiscal year 1990, 
$281,000, fiscal year 1991, $330,000; fiscal years 1992-1993, $359,000; 
fiscal year 1994, $337,000; fiscal years 1995-1997, $303,000 per year; 
fiscal year 1998, $450,000; and fiscal year 1999, $475,000. A total of 
$6,430,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $105,012 state appropriations in 1991; $84,368 state 
appropriations in 1992; $168.017 state appropriations in 1993; $118,725 
state appropriations in 1994; $33,498 in 1995 and 1996; $33,723 in 
state appropriations in 1997; $37,445 in state appropriations in 1998; 
and $201,994 in 1999.
    Question. Where is this work carried out?
    Answer. This research is being conducted at the Missouri 
Agriculture Experiment Station and the University of Missouri.
    Question. What is the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Many objectives are being met, but genetic interaction of 
the soybean cyst nematode/soybean is extremely complex. The anticipated 
completion date of the continuing research is in 2000.
    Question. What was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The last evaluation of this project was a merit review in 
January, 1998, and the renewal project will be evaluated in 1999. In 
summary, continued development of new management strategies for the 
soybean cyst nematode is extremely important. Progress in meeting the 
objectives in each goal continues with new varieties with nematode 
resistance being released yearly as well as excellent progress in other 
management strategies. The released lines include Delsoy 5710 and 
MPV437-NRR, while another nematode resistant strain is being evaluated 
in the uniform tests. More fundamental research involves the 
utilization of new molecular technologies to identify genes responsible 
for resistance. Over 118 PI lines have been fingerprinted to identify 
genetically diverse sources of nematode resistance. Gene fusion was 
utilized to monitor changes in soybean to determine effects on 
nodulation and nematodes. Other aspects of the works relates to field 
management strategies for these nematodes including effects of nutrient 
uptake on nematode development. Environmental effects on race 
development in nematodes has indicated that it is not soybean genotype 
driven but dependent on time of sampling and other factors not 
reflected in conventional nematode tests.
            steep iii-water quality in the pacific northwest
    Question. Please provide a description of the research that has 
been funded under the STEEP III--Water Quality in the Pacific Northwest 
grant.
    Answer. The STEEP III study was established in 1996 as the third 
phase of the tristate STEEP Program entitled ``Solutions to 
Environmental and Economic Problems,'' to meet the needs of farmers and 
ranchers in the Pacific Northwest in solving severe problems with soil 
erosion and water quality, while maintaining economically and 
environmentally sustainable agricultural production. An open call for 
research proposals is held by three cooperating states, Idaho, Oregon, 
and Washington. Awards are made competitively after both internal and 
external peer reviews within the states, and merit review by the 
agency.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. According to the research proposal, the soils of the 
Pacific Northwest wheat region are subject to severe wind and water 
erosion, which has taken a heavy toll of the topsoil in a little more 
than 100 years of farming. Due to the hilly terrain, water erosion has 
reduced potential soil productivity in the high rainfall areas of the 
region by about 50 percent. Wind erosion has reduced productivity on 
the sandy soils in the lower rainfall areas. Also, off-site 
environmental costs of water erosion are large. Although many of these 
are difficult to measure, they include damage from sediment to 
recreational areas, roadways, and other areas which costs taxpayers 
millions of dollars annually. Wind erosion, which occurs mostly in the 
spring and fall, also can be costly and environmentally damaging to air 
quality, and causes increasing concerns for human health and safety 
from blowing dusts. Water quality degradation is of increasing concern 
in the agricultural areas of this region, since sediment is a major 
pollutant of surface water runoff which may also carry potential 
chemical contaminants. The complex hydrology of the region's landscape 
has made it difficult to identify the sources of these chemicals in 
surface and ground waters. Water quality research of national 
significance could potentially be supported by competitive grants under 
the Water Quality Program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The primary goals are: to obtain and integrate new 
technical/scientific information on soils, crop plants, pests, energy, 
and farm profitability into sustainable, management systems; to develop 
tools for assessing the impacts of farming practices on soil erosion 
and water quality; and to disseminate conservation technology to the 
farm.
    The original STEEP and following STEEP II and STEEP III projects 
for erosion and water quality control, have provided growers a steady 
flow of information and technologies that have helped them meet 
economic, environmental, and resource conservation goals. Through the 
adoption of these technologies, the researchers believe that growers of 
wheat, barley, and other alternative crops have been able to reduce 
soil and wind erosion, improve water quality, and maintain or increase 
farm profitability. This has been accomplished through a tri-state, 
multi-disciplinary, multi-agency approach of basic and applied 
research, along with technology transfer and on-farm testing to assist 
growers with applying these research findings on their farms. The on-
farm testing program has directly involved growers and stakeholders in 
the planning and conduct of the research and educational efforts--and 
has helped growers evaluate conservation options, such as residue 
management, to meet conservation compliance requirements.
    STEEP programs have helped position farmers with new conservation 
technologies, such as direct seeding management systems, well in 
advance of deadlines to meet current and anticipated policy 
requirements. This preparation protects farmers against potential 
penalties and loss of government program benefits.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1991, 
and the appropriations for fiscal years 1991-1993 were $980,000 per 
year; in fiscal year 1994, $921,000; in fiscal year 1995, $829,000; and 
in fiscal years 1996-1999, $500,000 per year. A total of $6,690,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $938,812 state appropriations, $63,954 product sales, 
$156,656 industry, and $16,994 miscellaneous in 1991; $1,025,534 state 
appropriations, $75,795 product sales, $124,919 industry, and $88,696 
miscellaneous in 1992; $962,921 state appropriations, $62,776 product 
sales, $177,109 industry and $11,028 miscellaneous in 1993; $1,069,396 
state appropriations, $46,582 product sales, $169,628 industry, and 
$22,697 miscellaneous in 1994; and $1,013,562 state appropriations, 
$31,314 industry, and $107,151 miscellaneous in 1995. In 1996, 
Washington received $231,724 state appropriations; Oregon passed 
Measure 5 which reduced revenues and imposed funding restrictions so 
they were unable to provide any non-federal cost-sharing or matching 
funds; and Idaho contributed $81,525 state support, and $86,242 in 
estimated non-federal grant support, for a total non-federal 
contribution of $167,767. In 1997, Washington received $197,234 state 
appropriations; Oregon continues to have Measure 5 as law and continues 
to be unable to provide any non-federal cost-sharing or matching funds; 
and Idaho contributed $27,235 state support and $24,525 in estimated 
non-federal grant support for a total non-federal contribution of 
$51,760. In 1998, these same general levels of support have been 
continued.
    Question. Where is this work being carried out?
    Answer. The work under STEEP III will be done at laboratories and 
field research sites at the University of Idaho, Oregon State 
University, and Washington State University. Cooperative on-farm 
testing will be conducted in cooperation with growers on their fields 
in Idaho, Oregon and Washington.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The STEEP II project was completed in 1995, and the results 
were compiled in a final, five-year report in January 1997 showing that 
the original objectives have largely been met. The STEEP III project 
started in 1996 and will continue through the year 2000 as a five-year 
project.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency's program manager annually reviews progress 
reports, proposes new research on the STEEP Program, and attends the 
annual meetings to assess progress. The program is evaluated within the 
states each year by three committees: grower, technical, and 
administrative. Annual progress is reported at an annual meeting and 
compiled into written reports. These reports and the meeting are 
reviewed annually. Grower and industry input is solicited at the annual 
meeting on research objectives and accomplishments. The most recent 
evaluation was made at the January 1999 annual meeting which 
highlighted direct-seeding technology. This highly successful meeting 
attracted over 900 growers, scientists, and agricultural experts from 
the tri-state region. Farmer surveys are also distributed at each 
annual meeting, and results compiled to assess whether objectives are 
being successfully achieved.
                   sustainable agriculture, michigan
    Question. Please provide a description of the research that has 
been funded under the Sustainable Agriculture, Michigan program grant.
    Answer. This project is intended to develop agricultural production 
systems that are highly productive and profitable as well as being 
environmentally sustainable. More specifically, this project examines 
how to achieve a high nutrient flow from soil to crops and animals, and 
back to soil, with low loss to ground and surface waters. Pesticide 
application rates are also reduced. The grant is allocated by the 
Michigan Agricultural Experiment Station to priority areas within the 
general area of sustainable agriculture. Within each of those areas, 
grants are awarded based on research merit and proposal submission. The 
projects and proposals undergo annual formal review within the Michigan 
System prior to submission to CSREES, and then review within CSREES.
    Question. According to the research proposal or the principal 
researcher, what is the national, regional, or local need for this 
research.
    Answer. The principal researcher believes there is a need to better 
understand the biological processes occurring in Michigan's high-
nutrient-flow crop and animal systems. With high water tables, networks 
of lakes and slow-moving streams, and concern about environmental 
standards, field contamination by agricultural production materials is 
a high priority.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The specific goals of this research are to develop an 
agroecological framework for decision-making, develop crop and cover 
crop rotations, develop water table management strategies, and develop 
rotational grazing systems. Accomplishments to date include an 
extension publication on field crop ecology, development of on-farm 
compost demonstration sites, collection of research data and computer 
software models on water table management, completion of initial 
research trials on rotational grazing at three sites in Michigan, 
widespread testing of cover crops in several crop rotation systems, and 
tests of the use of nematology community structure as a method of 
detecting difference among farming systems. Findings from this project 
have demonstrated that rotational grazing reduces production costs and 
increases net profits, compared to traditional cow management. This 
project has also shown that composting is an effective way of 
stabilizing livestock waste, controlling odor, and improving nutrient 
composition for later land application. The computer modeling done with 
this project has shown reduced contamination of groundwater through 
alternative management practices employed in the project.
    Question. How long has this work been underway and how much as been 
appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1994 
with an appropriation of $494,000; $445,000 were appropriated in fiscal 
years 1995 through 1999, bringing total appropriations to $2,719,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Matching funds were provided at the state level for 
$511,900 in fiscal year 1994, $372,319 for fiscal year 1995, and 
$359,679 in fiscal year 1996. Matching support was not reported in 
fiscal years 1997 or 1998.
    Question. Where is this work being carried out?
    Answer. This work is being carried out in Michigan at several 
locations by Michigan State University. Locations include the Kellogg 
Biological Station, the Upper Peninsula Experiment Station, and farms 
around the state.
    Question. What was the anticipated completion date for the original 
objectives of this project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original project, begun in 1994, was proposed through 
April of 1997. Its specific objectives were met, with additional 
objectives addressed in subsequent related proposals. The current 
project is currently scheduled to go through September 30, 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last agency evaluation conducted.
    Answer. A formal evaluation of the Principal Investigator's program 
was concluded in 1997, commissioned by the C. S. Mott Foundation 
through an independent consultant. The project continues to have annual 
peer review. According to the Principal Investigator, the proposal has 
gone through the normal Michigan State University review process. 
First, all teams and collaborators of the project have met and reviewed 
the entire proposal with several suggestions and changes being 
incorporated. Secondly, research administrators in the fields of 
agronomy/soil science and entomology/pest management covering the major 
dimensions of the proposal have reviewed it for scientific 
appropriateness and accuracy as well as for overall balance and 
likelihood of achieving objectives. Their comments have been included 
as revisions to the proposal.
              sustainable agriculture systems for nebraska
    Question. Please provide a description of the research that has 
been funded under the Sustainable Agriculture Systems for Nebraska 
grant.
    Answer. This project is aimed at integration of field crops, animal 
production, agroforestry, livestock waste management, and diversified 
enterprises to meet production, economic, and environmental quality 
goals. The grant was awarded competitively within the University of 
Nebraska, and the integrated farm project has been reviewed annually 
for technical merit and progress toward goals by the internal review 
process of the university.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Farmers and ranchers in Nebraska and throughout the Midwest 
face increasing difficulties in maintaining profitable operations that 
are sustainable under increased production costs and more stringent 
environmental regulations. They continue to seek alternative production 
systems, integration of crop and animal enterprises, value-added 
products, including those from woody perennials, and new marketing 
approaches to secure more of the food dollar. Work on crop residue 
utilization is highly important to assess the loss of erosion 
mitigation when grazing occurs as well as the benefits of winter forage 
to production of lean beef. Erosion is still a major problem with 
monoculture cropping, and work with contour strips, residue management, 
and animal grazing is essential to provide good recommendations to 
farmers for how to manage fragile lands.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. This project has involved several components, with a number 
of results to date. In improving erosion control through grazing, 
calves were fed cornstalks from October through March, and fed some 
supplements. The calves had lower costs of production and reduced need 
for grain feed. The researcher's work on integrative cropping and 
agroforestry has shown that diversifying rotations centered around 
soybeans has provided increased economic returns. In the objective 
dealing with compost utilization, compost has provided increased 
sources of nitrogen and improved soil quality. Reports from this 
project have been disseminated through extension and through a 
sustainable agriculture newsletter.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. This project began in fiscal year 1992 with an 
appropriation of $70,000; subsequent appropriations are as follows: 
$70,000 in fiscal year 1993; $66,000 in fiscal year 1994; and $59,000 
per year in fiscal years 1995 through 1999. Total appropriations to 
date are $501,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Matching funds provided for this research include state 
funds in the amount of $25,313 for fiscal year 1992; $26,384 for fiscal 
year 1993; $27,306 for fiscal year 1994; $36,091 in fiscal year 1995, 
and $24,267 in fiscal year 1996. Matching funds were not reported in 
fiscal year 1997 or fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by the University of Nebraska 
at several locations in Nebraska, with the major part of the project at 
the Agricultural Research and Development Center near Mead, Nebraska.
    Question. What was the anticipated completion date for the original 
objectives of this project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original project proposed work through March of 1994. 
The current project proposes work addressing additional related 
objectives through March 31, 1999. It is expected that current 
objectives of the project will be met by this time period.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last agency evaluation conducted.
    Answer. There has not been a formal evaluation of this project, but 
progress reports have been submitted to the agency and reviewed by our 
scientific staff. There are no plans to do a performance evaluation in 
the future.
            sustainable and natural resources, pennsylvania
    Question. Please provide a description of the research that has 
been funded under the Sustainable Agriculture and Natural Resources, 
Pennsylvania, project?
    Answer. This project studies the cycling of nutrients in soil and 
crops with special emphasis on the development of indices for 
measurement of soil health. The project undergoes regular internal 
evaluation and assessment as part of Pennsylvania State University's 
major effort in soil quality and nutrient management research.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Degradation of soil health/quality is a most serious 
problem for agriculture both in the mid-Atlantic region and throughout 
the nation. State governments, both regionally and nationally, are 
attempting to address the issue of soil and water degradation in 
cropping systems and in intensive animal agriculture. Traditional soil 
test results are not providing the needed answers for effective 
nutrient management.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to understand the 
cycling of nutrients from animal agricultural production systems 
through soil and water into crops and back to food for animals or 
directly to humans in the case of vegetable production, and to use that 
knowledge to develop practical indicators of soil quality and health. 
If farmers are to manage their farm lands properly, indicators of soil 
quality and health must be developed that can be used by agricultural 
producers and consultants. Efforts under this project have been devoted 
to this goal with significant accomplishments to date. Management 
practices have been found to affect soil microbiology, and the fate of 
nutrients from crop residues and legume cover crops is being 
elucidated. A significant indicator of soil quality has been 
identified: measurement of the decomposition of filter paper has been 
shown to be an effective indicator of plant residue decomposition, 
which in turn has been shown to be highly correlated to nitrogen 
mineralization and also shows promise as an indicator of soil 
biological activity.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported under this grant began in fiscal year 
1993. The appropriation for fiscal year 1993 was $100,000; $94,000 per 
year in fiscal years 1994 through 1998; and $95,000 in fiscal year 1999 
for a total of $665,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. A total of $369,574 in matching support from university, 
state, and private industry sources was provided in fiscal year 1997. 
Matching support was not reported in fiscal year 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted by the Pennsylvania State 
University with cooperators throughout the state including the Rodale 
Institute Research Center and farms around the state.
    Question. What was the anticipated completion date for the original 
objectives of this project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project has met the specific objectives set forth in 
the original project which began in 1993 with an ending date in 1995. 
The continuing project addresses additional objectives related to the 
overall goal. The ending date for the current project objectives is 
June 30, 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last agency evaluation conducted.
    Answer. There has not been a formal evaluation of this project, but 
progress reports have been submitted to the agency and reviewed by our 
scientific staff. There are no plans to do a performance evaluation in 
the future.
                      sustainable beef supply, mt
    Question. Please provide a description of the research that has 
been funded under the Sustainable Beef Supply, Montana grant.
    Answer. This is a new project. Its purpose is to develop, 
implement, and evaluate a Montana Beef Quality Assurance Program for 
beef producers. It will center on training beef producers with regard 
to the best management practices to ensure food safety, feeder calf 
quality, and consistency.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The need for this research is to develop a reliable and 
predictable supply of safe, consumer-friendly beef of high quality. A 
National Beef Quality audit conducted by the National Cattlemen's Beef 
Association revealed that lack of proper quality control resulted in a 
loss of $103.16 per head slaughtered. Research will be used to develop 
a verifiable and certifiable beef supply that has been produced through 
a beef quality and assurance program.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals of this project are: develop a Beef 
Quality Assurance program for beef producers, implement a feeder calf 
certification program for Beef Quality Assurance-trained producers, 
implement an electronic identification and trucking system to document 
productivity of calves through various production schemes, and conduct 
producer educational programs focused on ranch financial management.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $500,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The State of Montana will contribute approximately $189,000 
in fiscal year 1999 to cover the salary of faculty at Montana State 
University involved with this project. In addition, the Montana 
Stockgrowers Association has contributed $15,000 this year to the 
project and will likely contribute additional funding.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Montana State University and 
on cooperating Montana ranches.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. This project will be initiated in fiscal year 1999 and will 
likely require three years to complete the objectives.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This is a new project. It will undergo a peer-review at the 
University before submission. The proposal, when received, will also be 
reviewed for merit prior to funding.
         sustainable pest management for dryland wheat, montana
    Question. Please provide a description of the research that has 
been funded under the Sustainable Pest Management for Dryland Wheat, 
Montana grant.
    Answer. Montana State University researchers are studying the 
influence of four cropping sequences and two tillage systems on 
insects, weeds, plant pathogens, nutrient management, physical and 
biological properties of soil, economic profitability, and 
environmental benefits. The research is being conducted on large 
experimental blocks in three different dryland farming regions--
northern, central, and eastern--in Montana. Each site differs 
climatologically and agronomically from one another yet represents a 
significant production area within the state.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. This project addresses pest management issues under 
different cropping sequences and tillage practices utilized in the 
Northern Great Plains for dryland wheat production. The wheat-fallow-
wheat system used by many farmers in the region favors the build up of 
many pests. Dollar losses due to insects, competitive weeds, and plant 
pathogens in dryland wheat production in Montana alone are staggering. 
For example, annual losses attributed to wheat stem sawfly exceeds 
$25,000,000; wild oat infestations causes an estimated $50,000,000 in 
harvest losses and management costs; and wheat streak mosaic has a 
monetary loss of $37,500,000. These and other pests also increase 
reliance on pesticides for crop protection which impacts environmental 
quality, increases production costs, and causes secondary pest 
outbreaks and resistance. The agronomic, environmental, and economical 
benefits of diversified crop rotations are numerous, but these benefits 
are largely unknown or not documented in dryland wheat production. As a 
result of this multi-disciplinary project, we can significantly reduce 
the economic impact of agriculturally important pests, improve soil 
health, reduce production costs, and improve production efficiency.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goals of the research are to investigate the physical, 
chemical, and biological interactions of cropping sequences, and 
tillage systems on soil attributes, water and nutrient use, weed 
species composition, presence of plant pathogens, and above and below 
ground insect populations. Profitability, marketing, and environmental 
benefits of diversified cropping systems will be examined so farmers 
can realize the risks and benefits of adopting these systems. Study 
results will be assimilated and transferred into practical solutions to 
farmers' problems relative to the constraints of dryland wheat 
production.
    The first cropping season has been completed. Data were collected 
on 26 different cropping sequences. Crops grown included spring wheat, 
pulses--pea, chickpea, and lentil--cool oilseed--mustard--warm 
oilseed--safflower--and sunflower. Numerous physical and chemical 
attributes of the soil were measured including available nutrients, 
soil aggregate characteristics, pH, forms of N, bulk density, salinity, 
water flow rates, and water holding capacity. Plant diseases were 
documented and soil samples taken for common root rot inoculum. Crop 
data taken included dates of plant emergence, vegetative dry matter, 
yield components, and straw residue. Insects in different crop 
rotations were estimated by sweep samples, sticky traps and pheromone 
traps. These results will be a valuable tool in assisting producers in 
understanding the interactions of cropping sequences and tillage 
systems as they impact pests and soil health. This work will also 
provide producers with a better opportunity to consider producing 
alternate crops under the Federal Agriculture Improvement Reform Act.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work supported by this grant began in fiscal year 1997 
and the appropriation for fiscal year 1997 was $200,000, and fiscal 
years 1998 and 1999, $400,000 per year. A total of $1,000,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds of $42,000 from the Montana Wheat and 
Barley Committee were provided for project support during 1997. Non-
federal funds of $80,000 from the Montana Wheat and Barley Committee 
were provided for project support during 1998.
    Question. Where is the work being carried out?
    Answer. Research is being conducted in three distinct dryland areas 
of Montana--north, central, and northeast--located on producer owned 
land. Each field site is within 45 miles of a Montana State University 
Agricultural Experiment Station research center.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The project was initially proposed for a duration of 3 
years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Yearly progress reports will be used to track the 
effectiveness of the program of research. Assessment of the precision 
of biological control organisms and estimates of profitability, 
marketability, and risk will be used to assess progress.
                 swine waste management, north carolina
    Question. Please provide a description of the research that has 
been funded under the Swine Waste Management, North Carolina, grant.
    Answer. During the past year, this multi-disciplinary project has 
expanded existing university efforts that have included plans to 
develop a prototype system for the treatment of animal waste which will 
be used to study and optimize new and innovative swine waste treatment 
processes. Specifically, the current project is focusing on the 
following topics: biological safety and nutrient quality of phosphoric 
acid-preserved animal mortality products processed by rendering, 
extrusion, and fluidized-bed cooking/dehydration; beneficial effects of 
swine manure biosolids on plant disease suppression; evaluation of 
alternative compost products; use of processed animal waste as a 
nitrogen and phosphorus source for Fraser Fir Christmas trees; 
production of a commercially-viable feed ingredient from animal wastes, 
cull sweet potatoes, and soybean hulls; routine techniques for 
monitoring the nutritional value of processed animal waste; and 
residual dietary phytase activity and phosphorus, calcium, and nitrogen 
content in fresh and composted manure.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The urgency for addressing environmental concerns relative 
to the intensive production of livestock and poultry continues to 
intensify in the United States. This is currently being reflected by 
strategies jointly proposed be U. S. Environmental Protection Agency 
and U. S. Department of Agriculture. In North Carolina, where livestock 
and poultry production account for approximately $5,000,000,000 in farm 
gate income annually, issues of adequate land area for recycling animal 
manures for crop uptake of nitrogen and phosphorus in some counties of 
intensive animal agriculture is especially sensitive. North Carolina is 
also currently in the process of implementing odor rules that will 
impact animal agriculture. Several other states and local regions are 
facing the same concerns. It is anticipated that deliverables from this 
research project will have a local, state and national impact.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The specific goals for this project include the following: 
utilize the North Carolina State University Animal Poultry Waste 
Management Center waste processing facility to develop optimum methods 
of screening, blending, fermenting, pelleting, extruding, and further 
processing animal waste-based nutrients for use as value-added 
products; installation of solid separation system at university swine 
research facility proximate to the Animal Poultry Waste Management 
Center waste processing facility; collect samples and establish supply 
sources of various types of animal waste by-products for conducting 
commercial scale processing and end-product evaluations; evaluate for 
targeted nutrient content and nutrient availability of processed 
materials targeted for use as plant nutrients; and evaluate materials 
processed for feedstuffs for targeted nutrient content and anti-
nutritional factors.
    These goals required assimilation of a multi-disciplinary research 
team, and completion of facilities that are able to heat treat, 
dehydrate, blend, extrude, compost, and pelletize the by-products to 
produce potentially valuable organic fertilizers or feed supplements. 
These tasks have been completed and the individual projects described 
previously are underway.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1997 
and the appropriation for fiscal year 1997 was $215,000; fiscal year 
1998 was $300,000; and fiscal year 1999 is $500,000. A total of 
$1,015,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. During fiscal year 1998 there were $244,622 in state funds 
provided in contract to North Carolina State University--NSCU--from 
North Carolina Department of Natural Resources and $80,460 in industry 
funds provided by membership monies from the members of the NCSU Animal 
and Poultry Waste Management Center in support of objectives related to 
this project.
    Question. Where is this work being carried out?
    Answer. This work is being conducted at North Carolina State 
University in Raleigh, North Carolina.
    Question. What was the anticipated date for the original objectives 
of the project? Have those objectives been met? What is the anticipated 
completion date of additional or related objectives?
    Answer. The original anticipated completion date was February 28, 
1999. Project objectives will not be completed by this date. The time 
to complete processes associated with equipment, facilities, and safety 
plans required for this project, coupled with unavoidable 
administrative delays in the secondary award process from Federal and 
university levels for this project, required a request for extension of 
the completion date to 2/29/00.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The Cooperative State Research, Education, and Extension 
Service conducted an evaluation of the progress of this work during 
January, 1999.
         tillage, silviculture, and waste management, louisiana
    Question. Please provide a description of the research that has 
been funded under the Tillage, Silviculture, and Waste Management 
Research Grant?
    Answer. This research has five components: Rice and Cotton Tillage, 
Bald Cypress and Water Tupelo Silviculture, and Dairy and Poultry Waste 
Management. More specifically, the Rice Scientist are looking for ways 
to improve stand establishment; the Cotton Scientists are focusing on 
the use of tillage systems to combat harmful insect populations; the 
Waste Management Scientist are quantifying the environmental and 
economic effectiveness of approved dairy and poultry waste disposal 
systems; and the Silviculturists are conducting a problem analysis on 
factors affecting Bald Cypress and Water Tupelo regeneration. The 
project is annually subjected to the university's merit review process.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researchers hypothesize that the crops, 
forests, and waste issues addressed by this project extend beyond the 
state borders, thus this research has, at a minimum, multi-state to 
regional application.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals were to: improve conservation tillage in 
rice and cotton farming; determine the effectiveness of no-discharge 
dairy waste treatment facilities; determine acceptable land treatment 
levels for poultry waste disposal; and to evaluate wetland forest 
regeneration processes. All components of the project have established 
research studies and are monitoring progress. For fiscal year 1998 the 
silviculture component was placed on hold and a sweet potato project 
was added. This decision was prompted by a staffing change in the 
Department of Forestry and Wildlife. Prior to this decision, an 
annotated bibliography of Bald Cypress Silviculture was completed and 
the responsible scientists had begun work on Water Tupelo regeneration. 
Louisiana State University's Agriculture Experiment Station Director 
remains actively engaged in the project by participating in the 
development and delivery of the annual proposal. Moreover, through his 
annual review process he fosters collegiality and professional 
discourse across Departments.
    Question. How long has the project been underway, and how much has 
been appropriated, by fiscal year, through fiscal year 1999?
    Answer. The work began in fiscal year 1994. The appropriation for 
fiscal year 1994 was $235,000. For fiscal years 1995-1999 the 
appropriation was $212,000 per year. This sums $1,295,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. State funding in support of these areas of research exceeds 
$750,000 annually.
    Question. Where is the work being carried out?
    Answer. Investigations are being conducted on the main campus at 
Louisiana State University as well as the Experiment Stations at 
Calhoun, Crowley, Chase, Winnsboro, St. Joseph, and Washington Parish, 
Louisiana.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related projects?
    Answer. The original work was scheduled for completion in 1999. 
Early term objectives have been met. The added experiments have closing 
dates ranging from 1999 to 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted?
    Answer. The last field evaluation was completed on December 12, 
1995. The evaluation summary complimented the scientists on the 
interdisciplinary components associated with this project, along with 
their investigative procedures, report writing, and external 
networking.
                       tomato wilt virus, georgia
    Question. Please provide a description of the research that has 
been funded under the tomato wilt virus research program grant.
    Answer. This is a new project that will provide the research to 
help in the reduction of major crop losses in the southeastern United 
Sates due to tomato spotted wilt disease. Research will focus on the 
vector biology and the virus transmitted by the vector. This project 
was not awarded competitively but has undergone peer review at the 
university level and merit review at CSREES.
    Question. According to this research proposal, or the principal 
investigator, what is the national, regional, or local need for this 
research?
    Answer. Tomato Wilt Virus has become a major yield-limiting 
constraint on a number of very important food crops. This is a problem 
world-wide, but in the last ten years has spread throughout the 
Southeastern states. Since this virus was first observed in Georgia in 
1986, it has caused an estimated $100,000,000 crop loss to the state. 
The wide host range of the virus and its vector make this a disease 
that is difficult to manage. The new strategies to manage this virus in 
Georgia will be applicable to all states where it occurs.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research is to reduce losses in the major 
crops grown in the Southwest due to spotted wilt. This requires 
identifying the sources of virus and vectors, determining the dynamics 
of the thrips species that transmit the virus, elucidating how the 
virus is acquired by thrips to identify possible genes to enhance virus 
resistance in plants, and adapting to crops in the Southeast the Risk 
Assessment Index for spotted wilt that is currently in implementation 
and refinement at the University of Georgia for peanut.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $200,000.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The non-federal funds provided for this grant are $84,736 
for 1999.
    Question. Where is this work being carried out?
    Answer. Research is being carried out at the University of Georgia 
and The Coastal Plain Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Since this is a new program, the original objectives have 
not yet been met.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project is under peer review at the University level 
and agency merit review.
                   tropical and subtropical research
    Question. Please provide a description of the research that has 
been funded under the tropical and subtropical research program grant.
    Answer. The Tropical and Subtropical Research--T STAR--Program is 
operating in coordination with the T STAR Caribbean and the T STAR 
Pacific Administrative Groups. State Agricultural Experiment Stations 
that are members of the Caribbean group are Florida, Puerto Rico, and 
the Virgin Islands; members of the Pacific group are Hawaii and Guam. 
The proposals are peer reviewed and are then selected for funding by 
the administrative groups.
    Non-member institutional interests are represented by the Executive 
Director of the Southern Region Agricultural Experiment Station 
Directors, who is a member of the Caribbean group, and the Executive 
Director of the Western Region Agricultural Experiment Station 
Directors, who is a member of the Pacific group. The Agricultural 
Research Service also has representation on the two groups, as does the 
CSREES scientist who manages the T STAR grant program.
    Funds for the program are divided equally between the two Basin 
Administrative Groups. The research objective of the program developed 
by the principal is to improve the agricultural productivity of many of 
the subtropical and tropical parts of the United States. Special 
research grants have been awarded for research on controlling insect, 
disease, and weed pests of crops; increasing the production and quality 
of tropical fruits, vegetables, and agronomic crops; promoting 
increased beef production through development of superior pastures; 
detection of heartwater disease of cattle and the influence of heat 
stress on dairy cattle reproduction; better use of land and water 
resources; developing computer models for efficient crop production 
systems and animal feeding systems; developing computer models for 
land-use decisions; using biotechnology methodologies for improving 
plant resistance to viral and bacterial diseases; using biotechnology 
to develop non-chemical, or biological, strategies for controlling 
insect pests; and potential for growing new speciality crops. fiscal 
year 1999 proposals have been requested.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes there is a need for the T 
STAR program to provide research-generated knowledge that enables 
informed choices in the responsible use of natural resources, 
facilitates the health and well being of American citizens through 
improved food safety and nutrition, provides frontline protection for 
the rest of the nation's farms and ranches from serious plant and 
animal diseases and pests, and enhances the ability of U.S. farmers to 
produce crops efficiently and economically and/or to introduce new 
crops and agricultural products with export potential to gain market 
share abroad. On a regional basis, the T STAR program addresses the 
unique challenges of practicing tropical agriculture, that is presence 
of pests year-round, heat stress, post-harvest processing to meet 
regulatory requirements for export, etc. The local need of Americans 
living in tropical regions of the nation for T STAR knowledge-based 
products to design and implement sustainable agricultural development 
within fragile tropical agroecosystems--particularly on tropical 
islands--and to develop new crops and niche markets.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to increase the 
production and quality of tropical crops; control pests and diseases of 
plants and animals; promote increased beef production; and conserve 
land and water resources. Grants have supported research on control 
strategies for Melon thrips; the biochemical nature of resistance to 
rust in nutsedge; development of bioherbicides for nutsedges; 
development of tomato cultivars with resistance to the spotted wilt 
virus; development of pheromones for monitoring and controlling the 
citrus root weevil; reducing the effects of heat stress in dairy 
cattle; development of a decision support system for vegetable 
production; finding cucurbits with resistance to silverleaf; developing 
a computer program for optimal supplementation strategies for beef and 
dairy cattle on tropical pastures; characterizing new strains of citrus 
tristeza virus in the Caribbean basin; determining the economic 
threshold for the citrus leaf miner on limes; using viral replicase 
genes to engineer rapid detection methods for geminiviruses; developing 
makers of bacterial spot resistance genes in tomato; breeding snap and 
kidney beans for resistance to golden mosaic virus and for heat 
tolerance; searching for resistance to papaya bunchy top disease; 
developing weed control for yam production; and bioengineering ringspot 
virus resistance in papaya.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The operation of the tropical and subtropical research 
program was transferred from ARS to CSREES, with CSREES funding being 
first provided in fiscal year 1983. Funds in the amount of $2,980,000 
per year were appropriated in fiscal years 1983 and 1984. In fiscal 
year 1985, $3,250,000 was appropriated. In fiscal years 1986, 1987, and 
1988, $3,091,000 was appropriated each year. $3,341,000 was 
appropriated in fiscal year 1989. The fiscal year 1990 appropriation 
was $3,299,000. The fiscal years 1991-1993 appropriations were 
$3,320,000 per year; $3,121,000 in fiscal year 1994; $2,809,000 in 
fiscal years 1995-1996; and $2,724,000 per year in fiscal years 1997 
through 1999. A total of $51,994,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. For fiscal year 1997, more than $1,000,000 of nonfederal 
were provided to the T STAR program from state appropriations, and for 
1998 $85,600. These state funds were in the form of faculty salary time 
commitments and indirect costs covered by the institutions.
    Question. Where is this work being carried out?
    Answer. This research is being conducted in Florida, Puerto Rico, 
Virgin Islands, Hawaii, and Guam. Work is also being done in other 
Pacific and Caribbean countries through agreements between institutions 
but not using Federal funds.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Research on tropical crop and animal agriculture is to 
increase productivity net profits, decrease harmful environmental 
impacts, conserve water, and natural resources. The need to continue 
with this project has been expressed by producers in the area, 
importers in the U.S. mainland and the institutions involved.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The projects that are funded by the T STAR Special Research 
Grant have been peer reviewed by panels of scientists in the U.S. to 
assure that good science is undertaken. Also, as part of the grant 
renewal process, progress reports are reviewed by the two 
Administrative Groups and by the grant manager at the national level. 
Workshops in which research results and their application for 
agricultural production are developed every two years. Research papers 
are published in the appropriate regional, national, and international 
forums available.
    The development in 1995 of the Strategic Plan for T STAR provided a 
mechanism to define priorities, examine program direction, and 
recommend operational changes. One of the principal points considered 
was to bring the Caribbean and Pacific Basin components closer and 
better coordinated. T STAR and the coordination which it implies was an 
outcome that will make this program better. Each sub project is peer 
reviewed annually at the initiating institution by the T STAR panel and 
by CSREES National Program Leaders.
                      turkey coronavirus, indiana
    Question. Please provide a description of the research that has 
been funded under the Turkey Coronavirus, Indiana, grant.
    Answer. This is a new grant in fiscal year 1999. CSREES has 
requested the university to submit a grant proposal that has not yet 
been received. The objectives of the research will be to: (1) develop 
enzyme-linked immunosorbent assays for detecting antibody to turkey 
coronavirus and turkey coronavirus antigen in turkey flocks, (2) 
elucidate immune responses in turkey poults infected with turkey 
coronavirus, and (3) determine which immunity, humoral and /or 
cellular, will provide the most effective protection for turkey poults 
against turkey coronavirus infection.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The need for this research is that the turkey industry 
plays a major role in animal agriculture in the U.S. This enteric 
disease of young turkey poults, called turkey poult enteritis or poult 
enteritis mortality syndrome, has contributed to significant economic 
losses by producers in Indiana, North Carolina, South Carolina, 
Virginia and other states. The cost to the industry is in the millions. 
Currently, no effective medication or vaccination is available for 
control and prevention of the disease. Although turkey poults that 
recover from the coronaviral enteritis may develop long-term immunity, 
little is known about the specific immunity. The proposed research will 
lead to further study on the understanding of immunological interaction 
between turkey poults and individual turkey coronaviral proteins and 
subsequent development of recombinant or a deoxyribonucleic acid 
vaccine for effective prevention of the disease. The enzyme-linked 
immunosorbent assays that will be developed in this research will 
provide an efficient tool for diagnosis and control of turkey poult 
enteritis.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The research is a new proposal so nothing has been 
accomplished to date. The goal of the research will be to develop 
enzyme-linked immunosorbent assays for monitoring antibody to turkey 
coronavirus and turkey coronavirus antigen in turkey flocks during 
acute outbreaks or recovery and in routine health monitoring and to 
develop effective vaccines to protect turkey poults against turkey 
coronavirus infection.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $200,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. This is a new proposal for fiscal year 1999. No non-federal 
funds will be provided in this fiscal year.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Purdue University in the 
Department of Veterinary Pathobiology and the Animal Disease Diagnostic 
Laboratory.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is December 31, 2001.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Since this is a new proposal, no evaluation has been 
conducted. However, it is anticipated that it will be reviewed by a 
CSREES specialist shortly after it is received by the agency.
                          urban pests, georgia
    Question. Please provide a description of the research that has 
been funded under the Urban Pests, Georgia grant.
    Answer. This research is focused on urban pests with specific 
emphasis on termites and ants. This project has been evaluated annually 
by CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes subterranean termites and 
ants are significant economic pests in the Southeastern United States. 
Damage and control costs for termites in Georgia were estimated at 
$44,500,000 in 1993. It is estimated that professional pest control 
operators apply over 23,000,000 pounds of active ingredients in and 
around homes each year. Chemicals currently registered for controlling 
these pests are less efficacious than desired and applied at an 
intensity that exceeds most agricultural settings.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of the termite research is to better understand 
the biology of subterranean termites and their responses to selected 
environmental cues in order to design monitoring, risk assessment, and 
precision-targeting control strategies using conventional and 
alternative methods. Additionally, an objective is to improve the 
identification of subterranean termites to the species level through 
studies of the termite genome, cuticular chemistry, morphometric 
characteristics, and termite behavior. Specific accomplishments in the 
termite research are as follows: Collection of three full years of data 
on over 80 different subterranean termite colonies in four of the major 
soil provinces in Georgia was completed in 1997. This data set has been 
compiled and is currently being analyzed using spacial analysis to 
assist in developing risk assessment models and precision-targeting of 
treatment options. Research with reduced-risk insecticides have 
provided data that will assist in registration of several novel 
chemistries within the next few years. Work with biological control 
agents has suggested that application of a naturally-occurring fungus 
to the structural components involved in a subterranean termite 
infestation should be efficacious in removing that infestation. 
Research continues to raise questions concerning the concept of baits 
as a termite control tactic. Recent data from termite behavior and 
genome studies indicate that the conventional concept of the monogyne--
one pair of parents--social structure of a termite colony is not valid 
raising questions about the real-world composition of subterranean 
termite societies.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This work supported by this grant began in fiscal year 1991 
and the appropriation for fiscal years 1991--1993 was $76,000 per year. 
In fiscal year 1994 the appropriation was $71,000 and in fiscal years 
1995 through 1999 the appropriation was $64,000 each year. A total of 
$619,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
by fiscal year were as follows: 1991--none, 1992--$26,000, 1993--
$18,000, 1994--$59,530, 1995--$59,539, 1996--$30,000, 1997-$80,00, 
1998-$50,000.
    Question. Where is the work being carried out?
    Answer. This research and technology transfer program is being 
conducted at the University of Georgia, Department of Entomology, 
Athens, Georgia..
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The grants have been processed on a year to year basis 
pending the availability of funds, however, the original objectives 
were essentially a five-to eight-year plan of work. CSREES 
entomologists judge that progress has been made on foraging behavior 
and the identification and development of termite baits. There has also 
been a publication of the research results.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project has been evaluated on an annual basis by 
CSREES, through the progress reports. Progress has been excellent.
                             vidalia onions
    Question. Please provide a description of the research that has 
been funded under the Vidalia Onion Grant.
    Answer. The research has concentrated on developing pungency 
testing procedures to improve quality and sensory consistency of 
Vidalia onions.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for the 
research?
    Answer. Vidalia onions are a specialty crop of extreme importance 
to the economy of certain areas of Georgia. The project is directed 
toward improving product quality and the nationally-and 
internationally-economic competitiveness of this production system.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The research has demonstrated that chemical tests can be 
used to accurately predict the pungency of onions prior to harvest, and 
perhaps flavor categorization, to consumers. The results have also 
indicated that several diseases affecting onions are the most serious 
problem in regard to quality and production.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The project began in fiscal year 1998 with an appropriation 
of $84,000 and for $100,000 in fiscal year 1999. A total of $184,000 
has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year.
    Answer. The non-federal funding for this project for the last two 
years was $193,137 from the state of Georgia and $251,427 in private 
funding.
    Question. Where is the work being carried out?
    Answer. The work is being conducted at the Coastal Plain Experiment 
Station in Tifton, Georgia and in test plots in several commercial 
field sites.
    Question. What was the anticipated completion date for the original 
objections of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated duration for the original project was five 
years. The initial objective of establishing procedures for pungency 
testing has proceeded ahead of schedule. The plant disease problems 
that have emerged will likely require several additional years, 
although the incidence and severity of these diseases are highly 
variable from year to year.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project is in it's second year, and the emphasis and 
objectives have changed from pungency research in fiscal year 1998 to 
onion disease research in fiscal year 1999. A CSREES review or 
evaluation has not yet been done on this project with plans to postpone 
the review until the end of the 1999 growing season when both aspects 
of the research project could be evaluated.
             viticulture consortium, new york & california
    Question. Please provide a description of the research that has 
been funded under the Viticulture Consortium grant.
    Answer. The University of California and Cornell University in New 
York conducted research on varietal responses of grapes, modeling of 
water requirements, management of diseases including Phyloxera, and 
other cultural aspects of grape production. Funds were used by the lead 
institutions to fund projects in the various grape-producing states 
within their region. Grants were made based on peer reviewed proposals 
and selected competitively by regional groups based on priorities 
developed by researchers, extension, and industry personnel.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The research being carried out is designed to help the 
viticulture and wine industries remain competitive in the U.S. and in 
the global market. Further, disease and insect problems are a concern 
of the industry, especially in new strains of phyloxera while overall 
improvement in all cultural management approaches to grape production 
need to continue.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research is to maintain or 
enhance the competitiveness of the U. S. Viticulture and wine industry 
in the global market.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal years 1996-1997, $500,000 per year; fiscal year 1998, 
$800,000; and fiscal year 1999, $1,000,000. A total of $2,800,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Each year the viticulture industry provides matching 
contributions in excess of the appropriated federal funds.
    Question. Where is the work being carried out?
    Answer. Research is being carried out in nine eastern states and 
California.
    Question. What is the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The research priorities set by the guidance group have not 
been met. The research is varied and complex and will take many years 
to complete.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project underwent merit review in January, 1998. The 
research proposals are peer-reviewed in both regions before selection. 
The review group is composed on industry, research, and extension 
personnel that are experts in viticulture.
                       water conservation, kansas
    Question. Please provide a description of the research that has 
been funded under the water conservation program grant.
    Answer. This research program is designed to develop and 
disseminate technical and economic information on the efficient use of 
water for irrigated crop production in western Kansas. The program has 
the following objectives:
  --Develop regression models to estimate the longevity of subsurface 
        drip irrigation systems using calculations of annual system 
        performance deterioration based on 13 years of operating 
        pressures and flow rates;
  --Evaluate utilization of livestock effluent with subsurface drip 
        irrigation and its effect on water redistribution and corn 
        water use patterns;
  --Develop best management practices for nitrogen fertigation using 
        subsurface drip irrigation systems for corn;
  --Estimate the long run economic impacts of irrigation efficiency 
        improvements for irrigated corn, wheat, and grain sorghum in 
        the farm sector and affiliated sectors of the High Plains 
        economy;
  --Disseminate irrigation research information and best management 
        practice recommendations to Kansas irrigators through a series 
        of extension bulletins and updates based on research-based 
        information.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher indicates that corn is the 
principal irrigated crop in Kansas and throughout the Great Plains. The 
principal researcher believes any realistic attempt to address 
overdraft of the High Plains Aquifer must address improvements in 
irrigation efficiency in corn production. The most common irrigation 
methods are furrow and sprinkler irrigation. The need to conserve water 
has focused attention on more efficient alternatives such as subsurface 
drip irrigation. This research will be of particular significance 
within the state and region. However, it also has national and 
international applications as advanced irrigation systems, such as 
subsurface drip irrigation, will be needed to improve irrigation water 
use efficiency in the next century.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The research goal is to determine the feasibility of 
subsurface drip irrigation and other alternative irrigation systems in 
western Kansas to sustain irrigated corn production to support the beef 
feedlot industry. The project also supports an educational effort 
through collection and dissemination of information on efficient 
irrigation methods. Subsurface drip irrigation acreage is increasing in 
Kansas and farmers are obtaining results on their own farms.
    The computer program Irrigation Economies Evaluation Svstem--IEES--
is complete and is being distributed by the Kansas State University 
Cooperative Extension Service. A report has been published which 
documents the data requirements and algorithms used in the model. A 
users guide is also available.
    Education poster sessions have been presented at three meetings. 
These posters were designed to inform potential users about the 
advantages of using the IEES software to evaluate irrigation options 
for farms in the Great Plains.
    A report entitled ``Economic Analysis of Alternative Irrigation 
Systems for Continuous Corn and Grain Sorghum in Western Kansas,'' has 
been completed. The results of this study indicate that a low drift 
nozzle center pivot system is the most profitable center pivot system 
to use for irrigation of corn and grain sorghum. Overall, a surge flood 
system was the most profitable because of its relatively low ownership 
costs. Although the subsurface drip system shows some potential, it is 
only economically feasible when above-average crop yield and price 
conditions exist.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1993 
with an appropriation of $94,000; $88,000 in fiscal year 1994; and 
$79,000 in fiscal years 1995-1999 each year. The total funds 
appropriated are $577,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $781,232 state appropriations, $55,205 product sales, 
$60,907 industry and miscellaneous in 1991; $868,408 state 
appropriations, $37,543 product sales, $35,484 industry and 
miscellaneous in 1992; $833,324 state appropriations, $54,964 product 
sales, $144,225 industry and miscellaneous in 1993. Amounts for other 
years should be similar.
    Question. Where is this work being carried out?
    Answer. The research is being conducted at Kansas State University. 
The field portion of the research is being conducted on Research 
Centers at Colby and Garden City, Kansas. Additional work is being 
carried out on campus at the Departments of Agronomy and Agricultural 
Economics in Manhattan, Kansas.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original anticipated completion date for the project 
was 1998. One of the most important objectives of the study is to 
evaluate longevity of the subsurface drip irrigation systems. These 
sites are unique to the region and very little information is available 
on system longevity. Pressing water quality problems of a regional and 
national scope has necessitated a change in the objectives to 
developing nutrient management practices under subsurface drip 
irrigation and utilization of livestock wastewater with subsurface drip 
irrigation. Additionally, changes in the federal farm program which 
allow greater planting flexibility has an effect on how irrigators make 
water/land allocation decisions. Field and economic studies related to 
allocation strategies, nutrient management, and wastewater utilization 
should be completed in three years.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project has been peer reviewed. The reviewers felt the 
project concept to be valid and the timetable for accomplishments to be 
on target.
                             water quality
    Question. Please provide a description of the research that has 
been funded under the Water Quality special research grant.
    Answer. The agency continues support of the national, 
competitively-awarded grants program as part of the Department's Water 
Quality Initiative. This program supports research to investigate the 
impacts of non-point source pollution from agriculture on water 
quality, and to develop improved, sustainable agricultural practices 
and systems that protect the environment and are economically 
profitable. This program is conducted jointly with the State 
Agricultural Experiment Stations, the U.S. Department of Agriculture's 
Agricultural Research Service and Natural Resources Conservation 
Service, the U.S. Environmental Protection Agency, the U.S. Geological 
Survey, extension specialists and other Federal, State, and local 
agencies. The water quality grants have supported more than 300 
research projects across the country. In fiscal years 1996 and 1997, 
funds were awarded to the five Management Systems Evaluation Areas 
projects in the Midwest to continue the water quality systems research 
started in 1990. In 1996, new projects were initiated as Agricultural 
Systems for Environmental Quality. The new projects focus on watershed-
scale agriculture production systems that reduce pollution of soil and 
water while maintaining productivity and profitability.
    In 1998, the U.S. Department of Agriculture joined with the 
Environmental Protection Agency and the National Science Foundation in 
the national Water and Watersheds program which focuses on watershed-
scale systems to improve water quality. Three projects have been funded 
under this new program.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The public is concerned about the possible risks to the 
environment, to soil quality, and to water quality resulting from the 
use of agricultural chemicals. Improved methods of detection of very 
minor amounts of chemicals in water have made the public, farmers, and 
policymakers more concerned about the use and management of these 
agricultural chemicals and wastes, while meeting the challenge of 
maintaining the efficiency and productivity of agricultural production 
systems. Water quality continues to be of high priority at local, 
regional and national levels. Results from the research are providing 
technologies to reduce pollutants, guidelines for site-specific 
farming, and improved farming systems.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals of the program were to determine the 
extent to which agriculture has impacted groundwater quality, and to 
develop new and improved, cost effective agricultural systems that 
enhance ground water quality. During the past three years, focus and 
allocation of resources have increased for surface water quality. Major 
progress has already been made on these goals. Examples of some of the 
results of recently completed research include the following:
  --Nebraska's water quality research indicates that irrigated corn can 
        be produced profitability with less water and nitrogen than 
        most farmers apply.
  --Ohio's Lake Erie Agricultural Systems for Environmental Quality 
        project, along with other State and Federal projects, is making 
        excellent progress in reducing phosphorus loading in two major 
        watersheds that discharge into Lake Erie. Watershed phosphorus 
        budgets indicate that the net annual accumulation of phosphorus 
        in the Maumee watershed has dropped from 23,000 metric tons to 
        2,600 metric tons. Farmers are no longer applying ``buildup'' 
        levels of phosphorus to their fields--a major cultural change.
  --In North Carolina, a 7-acre wetland is effectively removing 
        nitrates from the runoff and drainage of a 950-acre watershed 
        during the warm season; a Site-Specific Farming workshop was 
        held at Greensboro, North Carolina, and attracted some 200 
        participants; and several industrial and educational displays 
        have been developed for the Agricultural Systems for 
        Environmental Quality project.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work under the Water Quality Program began in fiscal 
year 1990 with an appropriation of $6,615,000. The subsequent 
appropriations were as follows: $8,000,000 in fiscal year 1991; 
$9,000,000 in fiscal year 1992; $8,950,000 in fiscal year 1993; 
$4,230,000 in fiscal year 1994; $2,757,000 in fiscal years 1995-1997; 
$2,461,000 in fiscal year 1998; and $3,461,000 in fiscal year 1999. A 
total of $50,988,000 has been appropriated for the Special Research 
Grants Water Quality Program.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds in support of the Water Quality 
program, provided by state appropriations, industry, product sales and 
other local sources, have averaged approximately $1,000,000 per year 
since the program began in 1990.
    Question. Where is this work being carried out?
    Answer. Funds provided under the Water Quality Program have been 
awarded to institutions in virtually every state, so work is being 
carried out in all parts of the country. The Management System 
Evaluation Area projects of the Midwest Initiative on Water Quality are 
headquartered in Iowa, Minnesota, Missouri, Nebraska, and Ohio, with 
satellite locations in North Dakota, South Dakota, and Wisconsin. Three 
new projects located in Indiana, North Carolina, and Ohio were 
initiated in fiscal year 1995. Three new projects located in Illinois, 
North Carolina, and Utah were initiated in 1998.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original goals of the Department's Water Quality 
Research Plan were to: (1) assess the seriousness and extent of 
agriculture's impact on groundwater quality, and (2) develop new and 
improved agricultural systems that are cost effective and enhance 
ground water quality. These original goals have been met; however, 
water quality programs need to have a long-term focus. The physical 
processes that link production practices to water quality and the 
socioeconomic processes that characterize adoption can both be of long 
duration. The adoption process, from first learning about a practice 
through implementation, can take years. While assistance is designed to 
speed up this process, overall progress can still be slow. Therefore, 
adequate resources must be made available for an extended period of 
time to ensure successful completion of the project.
    The original project was developed for five years with the 
expectation that it would be reviewed and possibly extended beyond the 
five-year period if warranted. The 1995 review of the program 
identified a need for increased attention to surface water quality 
problems. In 1996 and 1997, new water quality problems emerged; 
hypoxia, pfiesteria, etc.--which required renewed efforts. The research 
funded under the Special Research Grants Program has produced 
significant progress in understanding the impacts of agricultural 
practices on surface and groundwater pollution and in developing 
improved agricultural systems that are economically and environmentally 
sustainable. Implementation of some of these improved agricultural 
systems is already underway in a number of states. The focus over the 
next five years will be on developing and implementing agricultural 
systems that reduce the nutrient and contaminant loadings in our waters 
and watersheds.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An external review team evaluated the Management System 
Evaluation Areas and associated component projects in 1995. All 
Management System Evaluation Area projects have an impressive record of 
successfully implemented interdisciplinary teams to study water quality 
problems. A major conference on Management System Evaluation Area and 
Agricultural Systems for Environmental Quality results is scheduled in 
June 1999. Criteria used to evaluate the success of the Midwest 
Management System Evaluation Areas project included:
  --The relationship of the program to national and regional 
        priorities.
  --Contributions of the program to rural communities, to education of 
        scientists, and to the quality of life in rural communities.
  Methods used to transfer the project results to the customers and 
        clients.
  --Future opportunities and needs for environmental programs.
  --Progress toward accomplishing objectives.
                       weed control, north dakota
    Question. Please provide a description of the research that has 
been funded under the Weed Control, North Dakota grant.
    Answer. A major focus has been developing and evaluating systems to 
reduce herbicide use in crop production. The experiments of longest 
duration are field evaluations of sustainable, reduced tillage, and 
conventional crop rotation systems to ascertain changes in weed species 
and densities and in economic returns over time when weed management is 
reduced. Another emphasis has been weed biology, particularly 
understanding the unique physiological and genetic traits of herbicide-
resistant kochia and wild oat in an effort to recommend the most cost-
effective management alternatives. Another goal has been to improve the 
efficiency of postemergent herbicide use by utilizing additives that 
maximize weed control with reduced amounts of herbicide and by reducing 
spray volume and adapting new nozzle designs that improve application 
techniques.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The research address new methods to control weeds using 
systems control. The principles concerning effective use of additives 
with postemergent herbicides are being applied to improving the 
efficiency of postemergent herbicide use across the nation. Similarly, 
adaptation of herbicide application technology that allows reduced 
spray volumes while sustaining herbicide effectiveness is of nationwide 
benefit. The increased understanding of the inheritance and management 
of herbicide resistance in kochia and wild oat will be beneficial to 
management of these weeds in the central and northern regions of the 
United States where these weeds are abundant and cause major losses 
annually. The long-term field experiments should provide useful 
information on the positive and negative impacts of reduced weed 
management systems wherever spring-sown small grains are the primary 
crop.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The initial major activity was a long-term series of 
experiments to evaluate changes in weed species and populations and the 
economic returns in conventional, sustainable, and reduced tillage 
systems with rotations that are up to four years long. The research was 
initiated in 1993, but atypical wet conditions occurred for the first 
three years. It is felt that at least two complete cycles of crop 
rotations--eight years--will be necessary to accurately assess what 
farmers can expect from adopting new management systems.
    The research to improve the efficiency of herbicides lead to 
development of the principle that effectiveness of many postemergent 
herbicides can be improved by using additives that dissolve the 
herbicide. And this principle was utilized to develop a basic pH 
adjuvant that improves the effectiveness of several postemergent 
herbicides.
    The research with genetics of herbicide-resistant kochia has 
determined that inbreeding depression occurs when this naturally cross-
pollinated plant is self-pollinated to develop genetically uniform 
plants, which are desirable for many research objectives related to 
inheritance of genetic traits. However, this discovery also 
demonstrates that cross-pollination must be maintained in kochia for 
research intended to accurately simulate genetic changes and 
competition with crops that may occur in a field.
    Resistance of wild oat to many of the major herbicides used for its 
control in the United States has been documented, including resistance 
to imazamethabenz which has not been reported previously. Molecular 
biology and physiological studies have been initiated to better 
understand the cause of imazamethabenz resistance in wild oat, so 
management strategies can be recommended. Initial research has 
demonstrated that weed control by herbicides applied to weeds of 
recommended size has been equally effective when spray-drift-reducing 
or conventional nozzles are used. Because drift-reducing nozzles 
produce large droplets, the next step of evaluation is being initiated 
to determine whether small weeds are treated and controlled effectively 
when drift-reducing nozzles are used.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through year 1999?
    Answer. The support by this grant began in fiscal year 1992 and 
appropriation for fiscal years 1992 and 1993 was $500,000 per year; 
$470,000 in fiscal year 1994; and $423,000 per year in fiscal years 
1995 through 1999. A total of $3,585,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $27,030 state appropriations in 1992; $48,472 state 
appropriations in 1993; $41,969 state appropriations in 1994; $71,847 
state appropriations in 1995; $62,134 state appropriations in 1996; 
$78,579 state appropriations in 1997; and an estimated $70,000 state 
appropriations in 1998.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the North Dakota State 
University.
    Question. What was the anticipated completion date for the original 
objective of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original completion date for the long-term rotation 
experiment, utilizing the conventional, reduced tillage and sustainable 
management systems, was anticipated to be a minimum of 5 years, but the 
experience with atypically environmental conditions suggest that 8 to 
10 years will be necessary to attain a relatively steady state or 
logical end of the research. The current intent is to continue the 
research until at least 2002. The problems encountered due to the 
inbreeding depression in kochia suggests that it will be difficult to 
determine the true genetic nature of inheritance of herbicide 
resistance in this weed as quickly as projected. And due to the 
discovery of herbicide resistance of wild oat to imazamethabenz, the 
genetic and molecular biology research to characterize the nature of 
this resistance is just getting a good start. It is anticipated that 
the genetic and biology research with kochia and wild oat will need to 
continue until at least 2002.
    Question. When was the last Agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A scientific peer review of the written proposal was 
conducted in fiscal year 1998 by CSREES prior to awarding the grant. 
Based on comments from the reviewers, CSREES required that the 
university revise and resubmit the proposal. The resubmitted proposal 
was approved with the caveat that within one year a scientific peer, 
onsite, progress review would be conducted by CSREES. That progress 
review has not yet been completed.
                           wetland plants, la
    Question. Please provide a description of the research that has 
been funded under the Wetland Plants, Louisiana, grant.
    Answer. CSREES has requested the university to submit a grant 
proposal that is currently in preparation.
    Question. According to the principal researcher, what is the 
national, regional, or local need for this research?
    Answer. There is local, regional, and national need for this 
research. Coastal wetlands erosion is a serious environmental problem 
in many coastal locations around the United States. The problem is 
particularly severe in Louisiana where an acre of coastal wetlands is 
lost to erosion every 20 minutes. Current technologies, even at great 
expense, can only slightly reduce these losses. The research this grant 
is funding has the potential to provide a significant improvement with 
respect to both the magnitude and expense of future coastal erosion 
control efforts.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to develop an 
economically-feasible approach to controlling coastal wetlands erosion 
that would utilize vegetation to retain areas threatened by erosion and 
to rebuild lost land. To accomplish this, a system that incorporates 
agricultural principles involved in crop production is required. 
Specifically, a seed-based system utilizing appropriate planting 
material is required. While this is the first year of funding for this 
project from CSREES, progress has been rapid in developing this seed-
based system, and field trials in the marsh are already planned for 
1999.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 
1999, and the appropriation for fiscal year 1999 is $600,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $18,391 state appropriations, $5,319 industry grants, 
and $8,691 miscellaneous in 1999.
    Question. Where is this work being carried out?
    Answer. Research is being conducted at the Louisiana Agricultural 
Experiment Station.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Since this is a new program, the original objectives have 
not yet been met.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This is a new project, and there has been no prior agency 
evaluation. An agency evaluation is planned for fiscal year 2000 
following one year of project operation.
                             wheat genetics
    Question. Please provide a description of the research that has 
been funded under the Wheat Genetics grant.
    Answer. This project provides partial support for the Wheat 
Genetics Resource Center at the University of Kansas. The Center 
focuses on collection, evaluation, maintenance, and distribution of 
exotic wheat-related germplasm needed to develop new wheat cultivars 
resistant to disease, insects, and environmental stress.
    Question. According to the research proposal or the principal 
research, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes most cultivated varieties 
of wheat are derived from common sources. They lack the rich genetic 
diversity needed to develop resistance to diseases, insects, and 
environmental stress. The replacement of genetically-rich primitive 
cultivar and land races by modern, more uniform cultivars all over the 
world is causing erosion of wheat germplasm resources. New pests or 
those that have overcome varietal resistance pose a constant threat to 
the Nation's wheat production. Genetic resistance often resides in wild 
relatives of wheat. The researchers believe this program, which was 
established in Kansas, is providing service to wheat breeders 
nationally and internationally.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this research was to enhance the 
genetic diversity available to wheat breeders nationally and 
internationally by collecting, evaluating, maintaining, and 
distributing germplasm derived from wild relatives of wheat. To date, 
39 germplasm releases have been made containing new genes for 
resistance to such pests as Hessian fly, greenbug, leaf rust, soil-
borne mosaic virus and Russian wheat aphid. Germplasm stocks with 
resistance to leaf rust and powdery mildew are under development. 
Evaluation of germplasm for important resistance genes was carried out 
by Center scientists and cooperating institutions. Center scientists 
have introduced antifungal protein genes into the wheat plant to 
enhance its survival against pathogen attacks. One transgenic wheat 
line gave enhanced resistance to wheat scab, a devastating disease of 
wheat. In 1998, the Center filled 20 requests from U.S. wheat breeders 
for seed from the germplasm collection and 10 requests for seed of 
germplasm releases, as well as 34 requests from international breeders.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. Work supported by this grant began in fiscal year 1989. 
Appropriations were for fiscal year 1989, $100,000; fiscal year 1990, 
$99,000; fiscal year 1991, $149,000; fiscal years 1992-1993, $159,000 
per year; fiscal year 1994, $196,000; fiscal years 1995-1997, $176,000 
each year, and $261,000 each year in fiscal years 1998 and 1999. A 
total of $1,912,000 has been appropriated.
    Question. What is the source and amount of nonfederal funds 
provided by fiscal year?
    Answer. The nonfederal funds provided for this grant were as 
follows: $609,309 in 1991; $531,167 in 1992; and $730,082 in 1993, 
$468,960 in 1994; $563,671 in 1995; $457,840 in 1996; $495,820 in 1997; 
and $155,279 in 1998. Sources include state appropriations, product 
sales, and other organizations, such as state commodity associations.
    Question. Where is this work being carried out?
    Answer. This research is being conducted at Kansas State University 
at the Wheat Genetics Resource Center. The principle investigator also 
reports collaborative projects with other departments at Kansas State 
University, as well as other institutions in the U.S.
    Question. When was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The collection, evaluation, and enhancement of wheat 
germplasm is a continual process. Therefore, this project does not have 
a defined completion date.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The project was peer reviewed by the institution, Kansas 
Agricultural Experiment Station, and was found to address critically-
important issues in the winter wheat industry in Kansas and other 
states. As an ongoing project, the research has been productive based 
on germplasm releases and peer-reviewed journal articles and other 
publications. Additionally, each annual proposal is reviewed by a 
CSREES scientist.
                       wood utilization research
    Question. Please provide a description of the research that has 
been done under the wood utilization grant.
    Answer. The research includes: developing processes to upgrade low 
quality wood so it is suitable for higher value structural 
applications; catalyzing the formation of new business enterprises; and 
reducing environmental impact while improving systems for timber 
harvesting and forest products manufacturing.
    Question. According to the research proposal, or the principal 
researchers, what is the national, regional, or local need for this 
research?
    Answer. The forest products industry is very fragmented with many 
small firms which need publicly-sponsored research in order to remain 
economically viable. Research provides the woodworking machinery and 
tooling industry with technology to be more competitive in the global 
economy. Most of the companies helped through this research are too 
small to afford in-house research groups.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal is to generate new knowledge that will benefit the 
wood industry and the environment. New scientists are trained. 
Consumers benefit from better and more environmentally-sound products. 
Among the major accomplishments of the six centers are (1) design of 
glued-laminated beams that are reinforced with plastics to save 25-40 
percent of the wood fiber that would otherwise be needed, (2) 
technology to apply wood preservatives using super fluids to reduce 
environmental problems associated with present commercial treatments, 
(3) better harvesting systems that are efficient and environmentally 
acceptable, (4) increase of wood machining speeds and reduction of saw 
blade width to increase productivity and save raw material, (5) a 
patented system to apply pressure and vibration to prevent enzymatic 
sapstain which degrades hardwood lumber by $70,000,000 to $200,000,000 
per year, (6) reduction of quantity of wood bleaching chemicals needed 
by wood pulp producers, (7) design and strength of wood furniture 
frames to minimize wood requirements, and (8) adoption of European 
frame saw technology to composite lumber to provide a new raw material 
source for industry.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1985, $3,000,000; fiscal years 1986 through 1989, 
$2,852,000 per year; fiscal year 1990, $2,816,000; fiscal years 1991 
and 1992, $2,852,000 per year; fiscal year 1993, $4,153,000; fiscal 
year 1994, $4,176,000; fiscal years 1995 and 1996, $3,758,000 per year; 
fiscal years 1997 and 1998, $3,536,000 per year; and $5,136,000 in 
fiscal year 1999, which provided a $500,000 increase for the six 
existing centers, and $1,000,000 for two new centers. A total of 
$50,981,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Mississippi State University non-federal funds were: State 
appropriations, $2,498,800, $2,178,725, $2,353,225, 2,331,691, 
$2,650,230, $2,778,535, $2,582,617, and 2,543,017 for 1991, 1992, 1993, 
1994, 1995, 1996, 1997, and 1998, respectively. In addition, industrial 
funds averaged $783,458 for the 5 years from 1994 to 1998 in support of 
the Mississippi Forest Products Laboratory. Oregon State University 
state appropriations were: $1,337,962, $1,394,304, $1,256,750, 
$1,252,750, $1,417,755, $1,117,000, $1,100,000, $1,352,000 for 1991, 
1992, 1993, 1994, 1995, 1996, 1997, and 1998, respectively. Estimated 
non-public support was $670,000 this year. Michigan State University 
non-federal contributions for 1997 totaled $605,000. Three new 
locations were added in 1994: University of Minnesota-Duluth non-
federal match was $590,000, $550,000, $560,000, $371,930, and $307,532 
for 1994, 1995, 1996, 1997, and 1998; North Carolina State University 
was $126,000, $165,000, $135,000, $163,216, and $323,134 for 1994, 
1995, 1996, 1997, and 1998; University of Maine was $600,000, $445,723, 
$459,100, $477,464, and $526,210 for 1994, 1995, 1996, 1997, and 1998.
    Question. Where is the work being carried out?
    Answer. There are six locations. The initial three--Oregon State 
University, Mississippi State University, and Michigan State 
University--were joined by the University of Minnesota-Duluth, North 
Carolina State University, and the University of Maine in fiscal year 
1994. For 1999, they will be joined by a center at the University of 
Tennessee, and a second center at the University of Idaho, which will 
include a consortium of Idaho, Montana, and Washington State.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objective was to build and maintain three 
strong regional centers of wood utilization research. These centers 
have been established, and five more centers have been added. Projects 
begun in 1998 will be completed by 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. On site reviews of centers are conducted on a rotating 
basis. Each center's plans are reviewed yearly or more frequently. 
Progress reports are reviewed yearly. Center directors last met 
together for joint planning in June 1996 and will be meeting again in 
February 1999. Centers all have advisory committees or research 
committees which meet periodically. We conduct informal on-site reviews 
periodically. The Minnesota and Oregon sites were visited in 1996, and 
the North Carolina site was visited in 1997. Oregon State was visited 
in 1998. A Departmental panel reviewed the original three centers in 
1992 and 1993. At that time, the original objectives were broadened to 
include more consideration for environmental concerns. The centers have 
increased their focus on helping industry meet environmental objectives 
by conducting research leading to sustained timber production; 
extending the timber supply through improved processing; developing new 
structural applications for wood; and developing wood extractives to 
substitute for pesticides, preservatives, and adhesives.
                             wool research
    Question. Please provide a description of the research that has 
been funded under the wool research grant.
    Answer. The overall goals for this research are to develop 
objective measures of wool, mohair, cashmere, and other animal fibers 
to improve the quality of wool products while enhancing the 
profitability of the U.S. sheep and Angora goat industries. Specific 
objectives include: develop and evaluate measurement techniques for 
rapid objective evaluation of wool, mohair, cashmere, and other animal 
fibers; increase the use of objective measurements to increase fiber 
production, quality, and income to producers; and increase consumer 
acceptance of fabrics made from these fibers. The fiscal year 1998 
grants terminate between August 1999 and April 2000. The 1999 grant 
proposals have been requested by the agency. All grants are reviewed 
for relevance to industry needs and undergo scientific peer review.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. Collaboration exists among researchers in Texas, Wyoming, 
and Montana associated with this grant and other Federal, university, 
and industry scientists to assure responsiveness to the needs of those 
involved in wool and mohair production, marketing, and processing. The 
sheep and goat industries and the principal researchers believe that 
this research to be of national, regional, and local need. The research 
on wool, conducted by means of this grant, represents the only research 
efforts in the U.S. focused on improving the efficiency of measuring 
and assuring wool, mohair, and cashmere quality for garments made from 
these fibers.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The overall goal for this research is to develop objective 
measures of wool, mohair, cashmere, and other animal fibers with a 
focus on improving the efficiency of determining the quality of 
products made from these fibers while enhancing the profitability of 
the sheep and Angora goat industries. Research accomplishments included 
the development of rapid and inexpensive measurements of fiber 
diameter, distribution of animal fibers, and other fiber properties 
such as fiber length and color. Each of these properties are very 
important for grading and processing to determine ultimate softness, 
durability, dye characteristics, comfort, and garment price. Laser and 
near-infrared spectroscopy techniques were evaluated cooperatively with 
industry for the purpose of determining mohair yield, fiber diameter, 
and medullation. Research data from the program contributed to national 
and international programs designed to accelerate the use of the new 
technology by sheep and goat industries. The scientists also cooperated 
on several experiments by providing measured fiber data to improve 
selection, nutrition, management, and marketing studies with sheep, 
Angora, and Cashmere goats. Textiles manufacturers have expressed a 
willingness to pay premium prices for the improved preparation of U.S. 
wool. Investigators in the program found that the classing of raw wool, 
skirting, and the removal of belly wood provides a more desirable 
product to the textile manufacturer providing greater profits to the 
producer. These measurements impact the efficiency of the sheep and 
Angora goat industries, the effectiveness of monitoring the quality and 
consistency of imported products, and the satisfaction of buyers of 
wool, mohair and cashmere textiles. Historically, wool products were 
considered a strategic commodity in the United States for military use. 
It is important that the U.S. producers of wool, mohair, and cashmere 
are competitive in the world market and that consumers are assured high 
quality textiles.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Grants have been awarded from appropriated funds in the 
amount of $150,000 per year for fiscal years 1984-1985; $142,000 per 
year for fiscal years 1986-1989; $144,000 for fiscal year 1990; 
$198,000 for fiscal year 1991; $250,000 per year for fiscal years 1992-
1993; $235,000 for fiscal year 1994; $212,000 per year for fiscal years 
1995-1997; and $300,000 per year for fiscal years 1998-1999. A total of 
$3,181,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $150,913 state appropriations, $11,800 product sales, 
$5,817 industry, and $3,556 miscellaneous in 1991; $111,394 state 
appropriations, $25,451 product sales, $41,442 industry contributions 
and $3,068 miscellaneous in 1992; $152,699 state appropriations, 
$39,443 product sales, $40,804 industry contributions, and $3,556 
miscellaneous in 1993; $150,094 state appropriations, $35,284 product 
sales, $36,484 industry contributions, and $3,556 miscellaneous in 
1994; $67,345 state appropriations, $10,000 product sales, and $34,325 
industry contributions in 1995; $39,033 non-federal support in 1996; 
$174,486 non-federal support in 1997; and $200,307 state appropriations 
and $13,000 industry contributions in 1998.
    Question. Where is this work being carried out?
    Answer. The research is in progress at the Texas A&M University, 
Texas Agricultural Experiment Station at San Angelo, the University of 
Wyoming at Laramie, and Montana State University at Bozeman.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives to improve the efficiency and 
profitability of wool, mohair, and cashmere production and marketing 
are still valid. Specific objectives for individual laboratories and 
experiments are continually revised to reflect the changing research 
priorities for the wool, mohair, and cashmere industries and to satisfy 
consumer demands for products from these fibers. It is anticipated that 
five years will be required to complete the current research.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An external review of the overall wool research program was 
conducted in 1998 in Las Cruces, New Mexico by a team consisting of 
industry experts and peers from the scientific community. The review 
team concluded that the program was very productive and beneficial to 
the United States wool, mohair, and cashmere producers as well as the 
allied fiber industries. Research achievements, noted by the review 
team, included program input for testing methods and standards used to 
buy and sell wool for international trade. This has been very important 
in advancing issues important to domestic producers and maintaining 
competitiveness in the world market. World-wide acceptance of standards 
for the objective measurement of natural animal fibers due, in part, to 
the program has set the stage for the electronic marketing of wool and 
other fibers to aid the United States fiber industries in remaining 
competitive in the world market. Viable sheep and goat industries will 
support jobs for people in rural areas, supply alternative foods for 
public consumption, use natural means of brush control to abate fire on 
rangeland and inhabited areas, and provide alternative uses of land 
unsuitable for cultivation and cattle grazing.
    In addition to the program review, grant proposals are annually 
reviewed and the research facilities are periodically visited. The most 
recent visit and program assessment was in 1994 whereby it was 
determined that the stated objectives were being addressed and that 
they were consistent with industry needs. The principal investigators 
meet annually to evaluate progress and re-evaluate research priorities 
according to industry needs. Because the research encompassed in this 
grant is a component of a regional research project, accomplishments 
are reported annually to scientific peers and representatives from the 
sheep, goat, wool, mohair, and cashmere industries. In addition, the 
overall regional research project is peer reviewed every third year.
            agricultural development in the american pacific
    Question. Please provide a description of the research that has 
been funded under the Agricultural Development in the American Pacific 
program.
    Answer. The Agricultural Development in the American Pacific 
project called ADAP is a primary means for Land Grant research, 
extension, and instruction programs of the five participating 
institutions of American Samoa Community College, College of 
Micronesia, Northern Marianas College, University of Guam, and 
University of Hawaii, to collaborate and cooperate to enhance their 
impact on Pacific tropical agriculture and communities. ADAP is a 
mechanism to address common regional client-based issues while 
maintaining cultural, rural, economic, and environmental integrity. 
This special research grant is awarded noncompetitively to a program 
planned and approved by the five involved land grant institutions.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The principal researcher believes the five participating 
institutions are geographically dispersed yet facing many similar 
issues which can best be served through extensive networking and 
communication. ADAP facilitates communications and seeks to raise 
levels of academic achievement and improve the quality of education. 
ADAP's most unique feature is that twice each year it brings together 
the five Deans/Directors to discuss agriculture and human resources 
issues facing isolated, tropical ecosystems in the Pacific, and to plan 
and implement activities to address those issues. Priorities are 
categorized in three areas: sustainable systems, collaborations/
partnerships, and communication systems. Activities range from joint 
and collaborative efforts to overcome taro leaf blight in the Pacific, 
to seeking recognition of Pacific tropical agriculture by the National 
Association of State Universities and Land-Grant Colleges.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. ADAP's goals are to develop human resources within the 
institutions, to more effectively manage agricultural programs within 
and among the institutions, and to focus available resources on 
critical agricultural issues of the Pacific. Ongoing projects include 
animal health surveys, livestock waste management, dietary guidelines 
for Pacific foods, youth-at-risk assessment, artificial insemination 
demonstration/education, and market information collaboration with 
``state'' Departments of Agriculture. ADAP is now working jointly with 
the 22-nation Secretariat of the Pacific in developing a paraveterinary 
program. This program will use distance learning and site visits to 
train students from the cooperating nations and territories in animal 
health. This is a critical need for the Pacific region. Both ADAP and 
the Secretariat of the Pacific will contribute money as well as skilled 
personnel to assist in this project. In another regional cooperative 
effort, ADAP is planning a retreat for strategic planning among the 
``state'' and national Departments of Agriculture in the Pacific 
region, to be held in July 1999.
    Question. How long has this work been underway and how much has 
been appropriated, by fiscal year, through fiscal year 1999?
    Answer. This work was funded for seven years with an annual 
appropriation of $650,000 to the former Extension Service. In fiscal 
year 1994, an appropriation of $608,000 was made to CSREES to continue 
the ADAP program. The fiscal years 1996 through 1999 appropriations 
were $564,000 each year. The appropriation total to CSREES is 
$2,864,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funds are not provided. Unspecified in-kind 
support, such as facilities, equipment, and administrative support, are 
provided by each institution and, in some specific projects, by non-
ADAP collaborating institutions.
    Question. Where is this work being carried out?
    Answer. This work is being carried out by American Samoa Community 
College, College of Micronesia, Northern Marianas College, University 
of Guam, and the University of Hawaii.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The ADAP program has been achieving original program 
objectives, particularly in the areas of improvement in institutional 
capacity and communications. It is anticipated that an additional 5 to 
10 years will be needed to fully achieve collaborative integration of 
the American Pacific land grant programs.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A formal review of the ADAP program was conducted July 1-
10, 1997, and included visits by review team members to American Samoa 
Community College, College of Micronesia, Northern Marianas College, 
University of Guam, and University of Hawaii. ADAP incorporated review 
recommendations in preparing and adopting a new five-year 1997 
strategic plan. An agency specialist conducts a merit review of the 
proposals submitted in support of the appropriation annually. In a 
review of the proposal on April 23, 1998, progress was judged 
satisfactory.
             agricultural waste utilization, west virginia
    Question. Please provide a description of the research that has 
been funded under the Agricultural Waste Management, West Virginia 
grant.
    Answer. The West Virginia Department of Agriculture is conducting a 
project to validate the applicability and effectiveness of anaerobic 
filtration for treating municipal and agricultural wastes. POWER 
anaerobic filtration is a leading-edge technology specifically 
developed to biologically recover nutrients and energy from organic 
waste streams and produce an effluent which meets discharge permit 
requirements.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The current need for this technology is local, national, 
and international. The beneficiaries of this technology will be both 
the people and the environment anywhere in the world where problems of 
food, fertilizer, and energy shortages are currently in conflict with 
the preservation of environmental quality. The direct benefits include 
enhanced and expanded waste water treatment capacity, creation of new 
jobs, and revenue from by-products and water quality improvement.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal will go beyond the testing of waste materials in 
the digester and proceed with a program to compare the microbiological 
loading of rivers, where known environmental pollution is measurable, 
and where the total bacterial concentration in the rivers could be 
determined in real-time with a bioprobe. Specific microbial analysis 
may be able to correlate with farming activities.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
and the appropriation for fiscal year 1998 was $360,000 and for fiscal 
year 1999 is $250,000. A total of $610,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-Federal funds are not being expended.
    Question. Where is this work being carried out?
    Answer. Research will be conducted at Moorefield, West Virginia
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date of the original objectives 
is approximately two years. These objectives are within the original 
schedule.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The evaluation of the project was conducted at the end of 
January 1999 when the 1998 summary report was submitted.
                   animal waste management, oklahoma
    Question. Please provide a description of the research that has 
been funded under the Animal Waste Management, Oklahoma grant.
    Answer. This research project is designed to develop sustainable, 
environmentally-safe, and ecologically-sound best management principles 
and practices for beneficial animal waste applications for ``High 
Plains Agriculture'' in support of rural economic development through a 
Federal-state-local partnership. Emphasis will be placed on the rapidly 
expanding hog industry in the semiarid region, but information gained 
will also be applicable to the beef and dairy industries.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The Oklahoma Panhandle is the most productive agricultural 
region in the state with agricultural receipts in excess of 
$800,000,000. Nationally, Texas County in the Oklahoma Panhandle ranks 
number one in the state and in the top 15 of all counties in the United 
States relative to cash receipts. The rapid expansion of the hog 
industry in this semiarid region will only strengthen that position. 
The rapidly expanding swine industry was projected to add $650,000,000 
in pork and value added products in Oklahoma in 1997 with the slaughter 
and processing of over 4,000,000 hogs per year. Information gained from 
this study will provide the data base to develop best management 
practices to maximize beneficial nutrient use and minimize nuisance 
odor in semiarid and rangeland production systems. Practices developed 
will have significant implications regionally, nationally, and 
internationally. The semiarid agro-ecosystem is unique with climatic 
conditions consisting of low rainfall that promotes both dryland and 
irrigated agricultural practices; extremes in high and low 
temperatures; and soils characterized with alkaline pH, low in organic 
matter and high in calcium carbonate. This unique agro-ecosystem makes 
information gained from more humid environments inapplicable.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. Field work has been initiated and initial work shows a 
positive response to animal waste applications. Initial studies of 
ammonia loss from applications indicate there can be significant losses 
following land applications. The original goal of this research is to 
develop best management practices that will protect ground water 
supplies from pollution of nutrients, salts, and pathogens; maintain 
air quality; and minimize odors derived from the entire hog-house, 
lagoon, land-application, and or rangeland production system, thus 
maintaining the quality of life in the rural sector.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
and the appropriation for the fiscal years 1998 and 1999 is $250,000 
per year. A total of $500,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The research is matched by $554,000 non-federal funding. 
Other sources include state and industry.
    Question. Where is this work being carried out?
    Answer. This work has been initiated at The Oklahoma Panhandle 
Research and Extension Center located in Goodwell, Oklahoma. Further 
work will continue to be done at this site. The Center will provide the 
land area and a portion of the facilities and equipment necessary to 
conduct the major portion of the study. Other study sites will be 
developed on private land in cooperation with hog operations in the 
panhandle region.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original completion date was February 29, 2000. To 
document the results for these objectives more than one growing season 
will be needed. Completion of these objectives and additional 
objectives related to these will be February 28, 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This project was evaluated at the end of January 1999 when 
the summary report of the 1998 accomplishments was submitted. Results 
showed that a significant amount of ammonia will be volatilized almost 
immediately when the swine effluent is surface applied to crop land. 
Field plots have been established in order to receive various rates and 
methods of swine effluent applications. Plans have been made for a 
regional meeting titled, High Plains Animal Water Management 
Conference.
              center for agriculture and rural development
    Question. Please provide a description of the research that has 
been done under the Center for Agriculture and Rural Development 
program.
    Answer. The research provides current economic information on 
international trade in agriculture and analyses of the implications of 
trade policy alternatives on the agricultural sector of the United 
States and other countries.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. According to the proposal, trade negotiations and 
agreements are of national concern to policymakers, farmers, and 
agribusiness industries because of the implications for maintaining or 
opening markets and establishing improved terms of trade and prices. 
Typical agreements are extremely complex, requiring analysis by 
specialists to determine outcomes and to provide objective and accurate 
information to those impacted by such agreements. The specific research 
done under this project directly addresses national needs but has 
national, regional, and local implications.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The goal is to assess and evaluate various proposals 
affecting agricultural trade, to provide analytical support to the 
Office of the U.S. Trade Representative, and to provide information to 
farmers and agribusiness firms on the competitive implications of trade 
agreements. Theoretical studies and empirical and descriptive analyses 
of policy issues and technical problems pertaining to the Uruguay round 
of negotiations were completed and provided to negotiators and the 
agribusiness community. Knowledge developed in this phase is now being 
used to monitor the effects of the Uruguay Round Agricultural 
Agreement--URAA.
    This grant supports six projects focusing on URAA and the World 
Trade Organization--WTO--monitoring and implementation problems; 
implications of the URAA and WTO for Eastern Europe, Baltic, and the 
Newly Independent States; development of a model to assess the North 
American Free Trade Agreement and its linkages with the General 
Agreement on Tariffs and Trade; trade implications of U.S. food and 
development aid in developing countries; integration of China into 
world agricultural markets; and special projects as requested for the 
U.S. Trade Representative's office. Major emphasis is placed on 
developing and improving international livestock and grain sector 
models.
    This grant supports six projects focusing on the General Agreement 
on Tariffs and Trade monitoring and implementation problems; 
implications of the General Agreement on Tariffs and Trade for Eastern 
Europe, Baltic, and the Newly Independent States; development of a 
model to assess the North American Free Trade Agreement and its 
linkages with the General Agreement on Tariffs and Trade; trade 
implications of U.S. food and development aid in developing countries; 
integration of China into world agricultural markets; and special 
projects as requested for the U.S. Trade Representative's office.
    Question. How long has this work been underway and how much has 
been appropriated, by fiscal year, through fiscal year 1999?
    Answer. This research program was initiated in fiscal year 1989. 
Grants have been awarded from funds appropriated as follows: fiscal 
year 1989, $750,000; fiscal years 1990 and 1991, $74l,000 per year; 
fiscal years 1992-1993, $750,000 per year; fiscal year 1994, $705,000; 
fiscal year 1995, $612,000; fiscal year 1996, $655,000; and fiscal 
years 1997 through 1999 $355,000. A total of $6,769,000 has been 
appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $111,210 State appropriations and $175,616 
miscellaneous for a total of $286,826 in 1991; $113,779 State 
appropriations and $173,117 miscellaneous for a total of $286,896 in 
1992; $120,138 State appropriations and $164,707 miscellaneous for a 
total of $284,845 in 1993; $161,673 State appropriations and $32,000 
miscellaneous for a total of $193,673 in 1994; $161,000 State and 
$30,000 miscellaneous for a total of $191,000 in 1995; $70,000 State 
appropriations and $44,000 miscellaneous for a total of $114,000 in 
1996; $60,325 in State appropriations and $61,500 in miscellaneous 
funds for a total of $121,825 in 1997; and $72,000 in State 
appropriations and $75,000 in miscellaneous funds for a total of 
$147,000 in 1998.
    Question. Where is the work being carried out?
    Answer. The research program is carried out by the Center for 
Agriculture and Rural Development at Iowa State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives of the project envisioned the 
development of models capable of providing guidance to policymakers, 
researchers, and farmers and others of the impact of agricultural trade 
proposals on the U.S. agricultural sector. As such the objectives are 
on-going.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. We have conducted no formal evaluations; however, each 
annual proposal is peer reviewed for relevance and scientific merit. 
Also, an informal evaluation of this project takes place as a part of 
each annual project review and approval process.
                center for north american studies, texas
    Question. Please provide a description of the research that has 
been done under the Center for North American Studies program.
    Answer. The purpose of this grant is to develop linkages with 
educational and other institutions in Mexico and Canada in order to 
share data and faculty, conduct research identifying trade 
opportunities and marketing problems, conduct policy analysis, and 
develop a broad range of training programs preparing agricultural/
agribusiness firms for international marketing opportunities. The 
research proposal received a merit review at the university prior to 
submission to CSREES.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The program director believes that citizens of the United 
States, Mexico, and Canada have some similar concerns about the impact 
of the North American Free Trade Agreement--NAFTA--and that new, 
innovative approaches involving international cooperation are needed to 
assess and evaluate these issues. Research and training are needed to 
provide information to evaluate alternatives for expanding U.S. exports 
and to resolve potential social, economic, and environmental conflicts.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The goal is to promote strong agricultural ties among the 
three North American countries, foster greater cooperation in resolving 
critical agricultural issues of common interest, and ensure the 
continued competitiveness of U.S. agriculture. Institutional linkages 
with Mexican and Canadian universities continued to be developed and 
joint research and educational programs conducted. An international 
agribusiness information system, AGRINET, was created on the Internet 
and is accessible by firms from all three countries. A compilation of 
6,600 articles on agricultural issues is available electronically 
throughout the region. An international video conference enabled U.S. 
faculty to make presentations at a Mexican trade conference. Research 
focused on potential markets in Mexico for U.S. products, such as rice, 
dairy, livestock, meat, feed, fresh fruits, and vegetables. A new model 
is being developed to analyze the impact of international trade 
agreements on farm and trade policy of NAFTA countries. Training 
programs included several seminars and conferences to increase the 
international capacity of U.S. firms; over 2,800 people attended in 
1997. New international agribusiness courses were offered at several 
Texas institutions. Some of these educational programs were developed 
with faculty from Mexican and Canadian institutions and used with 
audiences in those countries.
    Question. How long has this work been underway, and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Work supported by this grant began with an appropriation of 
$94,000 in fiscal year 1994; $81,000 in fiscal year 1995; and $87,000 
per year for fiscal years 1996 through 1999. A total of $523,000 has 
been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
are as follows: $39,000 State appropriations in fiscal year 1994; 
$54,000 in 1995; $60,000 in 1996 and 1997; and $84,500 in 1998.
    Question. Where is the work being carried out?
    Answer. The program is being carried out at Texas A&M University 
through the Texas Agricultural Experiment Station in collaboration with 
other segments of the Texas A&M University System and Louisiana State 
University Agricultural Center.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1994 was for a period of 12 
months. The current phase of the program will be completed in the year 
2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation.
    Answer. CSREES performed a merit review of the project in February 
1998, as it evaluated the 1998 project proposal, and concluded that the 
project has sound objectives and procedures for helping U.S. firms to 
be successful in North American markets for agricultural products, 
thereby achieving CSREES goals of a highly competitive agricultural 
production system and enhanced economic opportunity for Americans. The 
principal investigator is well recognized for his leadership in the 
area of international trade.
                        data information system
    Question. Please provide a description of system development 
activities that have been funded.
    Answer. Cooperative State Research, Education, and Extension 
Service--CSREES--continues to fund activities under contract with a 
major information technology firm for the design and development of the 
Research, Education, and Economics Information System--REEIS. 
Previously-funded tasks that have been completed include the conduct of 
an inventory of databases targeted for inclusion in REEIS, the conduct 
of a comprehensive needs assessment focusing on information needs and 
practices within the Research, Education, and Economics mission 
agencies and State partner institutions, the design and development of 
a Web accessible catalog of databases identified in the inventory, and 
specifications for a retrieval language--a controlled vocabulary--for 
assisting users in accessing and searching REEIS databases. An 
additional task was completed under a separate contract that provided 
for an outside expert to conduct a review and evaluation of Web 
interfaces to the REEIS Database Catalog. A cooperative agreement with 
the University of Arkansas was also established to provide national 
leadership in coordinating the efforts of a National Steering Committee 
charged with guiding the development of the system. The Committee has 
met on three previous occasions, and a fourth meeting is planned in 
June, 1999. Currently underway, and critical to the development of 
REEIS, is a comprehensive review of state-of-the-art information 
technology systems that are available for use in developing the system. 
This will provide information needed by REEIS decision makers, systems 
staff, and other stakeholders to review the available information 
systems and technology options, and it will identify a representative 
set of tools and technologies that will serve as the basis for 
conducting benchmark studies and development of system prototypes. 
Funding is also provided under the REEIS initiative for enhancement of 
the Cooperative Extension System Plan of Work and Reporting System 
which has been targeted for ultimate inclusion in REEIS.
    Question. What is the national, regional or local need for this 
activity?
    Answer. At present, USDA's Research, Education, and Economics--
REE--mission agencies and their university partners lack a central, 
integrated, user-friendly electronic information system capable of 
providing access to thousands of programs and projects for which they 
are responsible that focus on food, agriculture, natural resources, and 
rural development. Such an information system is increasingly needed to 
enable the Department and its partners to readily conduct baseline and 
ongoing assessments and evaluations of research, education, extension, 
and economic programs and projects. In recent years, this need has 
become more urgent for several reasons. First, the United States needs 
a visionary publicly-funded research and development program to produce 
essential knowledge and innovations for meeting growing competition in 
a global market--which is largely attributable to the expanding 
research and development efforts of foreign nations. Second, a 
comprehensive information system is needed to serve as a primary 
reference source for development of new research and education projects 
on such diverse issues as increasing productivity in agriculture and 
processing, improving the safety and quality of food, and enhancing the 
sustainability of the environment and rural communities. Third, 
Federal/State policy makers and administrators are requiring empirical 
analyses to account for historical, current, and future use of public 
funds to provide a basis for redirecting funds to higher priority 
issues. Fourth, the Government Performance and Results Act--GPRA--has 
imposed reporting demands which current databases and decentralized 
information systems are not prepared to adequately satisfy. It is also 
envisioned that REEIS will play a key role in implementation of the 
Agricultural Research, Extension, and Education Reform Act--AREERA--of 
1998. In this regard, REEIS would be well positioned to: Provide 
linkages for decision making among REE agencies, enable consistent 
reporting on identical or similar issues, provide the public with 
understanding of the role and mission of REE agencies,Expand REE's 
outreach to a broader base of constituencies, Provide a better vehicle 
to facilitate interaction among REE agencies and their university 
partners, Link commonalities of research, extension, and teaching 
projects and programs through a single interface, and foster global 
interactions.
    Additionally, REEIS would serve to expand the Federal partnership 
by facilitating coalition-building with other Federal agencies.
    Question. What was the original goal of this initiative and what 
has been accomplished to date?
    Answer. The original goal of this initiative was to develop an 
information system that provides real-time tracking of research, 
extension, and education projects and programs; has the capability to 
communicate vertically between field, State, and Federal locations; 
enables the REE agencies and their partners to conduct rapid and 
comprehensive policy assessments and program evaluation analysis; 
facilitates assessment of technologies and practices employed in 
extension, education, economics, and research activities at the field 
and/or regional levels; provides clear and transparent public access to 
relevant parts of the information; and provides information management 
tools to enhance the timeliness and accuracy of REE-wide responses to 
inquiries about program objectives and expenditures.
    Over the last year-and-a-half, substantial system planning and 
development work has been completed. Work accomplished under five 
multi-task contracts awarded during this period was instrumental in 
meeting major milestones considered to be critical components and a 
prerequisite to the design, development, and implementation of REEIS. 
Major tasks included the conduct of a comprehensive strategic 
information audit of information practices and needs within the REE 
agencies and partner institutions; the identification and inventory of 
major research, extension, education, and economics/statistics 
databases maintained or supported by the REE mission agencies; the 
design, development, and preparation of the REEIS Database Catalog 
Prototype that affords Web access to the inventory of 38 databases 
initially identified as candidates for inclusion in REEIS; and the 
design and evaluation of the Web interface to the REEIS Database 
Catalog.
    The Needs Assessment, the main component of the strategic 
information audit, was recently completed. The purpose of the study was 
to identify system requirements as a prerequisite to development of 
detailed system specifications for a functional and physical design for 
REEIS. Over 130 system requirements are identified in the study which 
was undertaken with broad participation by REE agency personnel, State 
partners, and key stakeholders. A review and prioritization of the set 
of requirements by REE agency national program leaders, commodity 
specialists, and senior managers is currently underway.
    In further response to Congressional legislation, a comprehensive 
review is underway to identify state-of-the-art information systems 
that are available for use in developing REEIS. The first report 
resulting from the review provides a set of criteria for product 
selection and evaluation and an initial data warehousing product suite 
list. The final set of system products and tools will be included in an 
updated and maintained Information Systems Technology database for 
subsequent use in REEIS system development activity.
    Plans in fiscal year 1999 include the development of functional and 
physical specifications for REEIS, technical assessments of candidate 
databases for inclusion in REEIS, development and assessment of 
alternative system architectures, development and testing of a REEIS 
prototype, and updating and maintenance of the Information Systems 
Technology database and the REEIS Database Catalog. Implementation of 
the REEIS system, including training of REEIS users and technical 
system operators, is targeted for fiscal year 2000. The President's 
fiscal year 2000 budget requests $2,000,000 to support these efforts.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Congress first appropriated $400,000 REEIS in fiscal year 
1997 to begin planning its design and development. An additional 
$800,000 was appropriated in fiscal year 1998 and $1,000,000 was 
appropriated in fiscal year 1999 for a total of $2,200,000 in fiscal 
year 1997 the REEIS National Steering Committee was established to 
provide advice and guidance throughout the development and 
implementation process. Since its inception, the Committee has met 
three times, first recommending a plan of action and work 
specifications for conducting a strategic information audit and 
comprehensive needs assessment, and at its second and third meetings to 
review and evaluate contract deliverables, develop recommendations, and 
participate in assessing progress and plans for REEIS. The Committee 
will meet again this year in Washington, D.C. in June. Also in fiscal 
year 1997, a private information technology firm was engaged to conduct 
Phase I of a two-phase strategic information audit. Phase I resulted in 
a project management plan and specifications for the needs assessment, 
a REEIS database catalog, and controlled vocabulary.
    In fiscal year 1998 Phase II was launched with full-scale 
implementation of the needs assessment. Phase II has resulted in a 
comprehensive list of more than 130 system requirements and a detailed 
analysis of information needs and practices of potential REEIS users. 
Findings of the study are based on responses from administrators, 
budget, and GPRA staff, senior managers, and program leaders within REE 
as well as administrators, policy officials, and faculty from State 
partner institutions, and other stakeholders. Results of the needs 
assessment were formally presented in February, 1999 in Washington, 
D.C. Also funded in fiscal year 1998 was work to enhance the REEIS 
database catalog; advisory services for conducting an outside review of 
Web interfaces to the REEIS database catalog prototype; and cooperative 
agreements for constructing a Web site for Human Sciences Research and 
enhancement of the Cooperative Extension System Plan of Work and 
Reporting System. Funds were also provided in fiscal year 1998 for 
conducting a comprehensive review of state-of-the-art information 
technology systems. The first deliverable from this contract is a list 
of evaluation criteria for software systems and system product 
selection and an initial data warehousing product suite list. A final 
report from this effort will provide information needed by REEIS 
decision makers, system staff, and other stakeholders to review 
information systems and technology options that are available for use 
in developing the REEIS system. Additionally, the identification of a 
representative set of tools and technologies resulting from this effort 
will serve as the basis for conducting benchmark studies and prototypes 
in subsequent REEIS design and development activities.
    Projects to be funded in fiscal year 1999 include development of 
functional and physical specifications for REEIS, detailed technical 
assessments of candidate databases for inclusion in REEIS, assessments 
of alternative system architectures, development and testing of a REEIS 
prototype, and updating and maintenance of the Information Systems 
Technology database and the REEIS Database Catalog and its Web 
interface.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Non-federal funding does not apply at this time.
    Question. Where is this work being carried out?
    Answer. Leadership responsibility for REEIS resides within the 
CSREES Science and Education Resources Development division in 
Washington, DC. This provides for effective linkage within the REEIS 
platform of the Current Research Information System, the Food and 
Agricultural Education Information System, and appropriate extension 
databases. CSREES is working closely with all REE mission agencies and 
with the university system via a cooperative agreement with the 
University of Arkansas. We hope also to use the Intergovernmental 
Personnel Act to secure an IPA from another university to carry out 
REEIS essential management responsibilities. One staff person is 
assigned full time to manage and coordinate agency contracting 
activities and serves as the REEIS technical information program 
manager.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. It is anticipated that REEIS will become operational during 
the year 2000. The fiscal year 1997 appropriation of $400,000 covered 
start-up costs such as establishment of a National Steering Committee, 
preparation and specifications for contracting with an outside firm, 
contractor selection, project planning, and pre-design analyses 
conducted under contract with a major private sector information 
technology firm. Contract work completed included preparation of an 
inventory and prototype catalog of REE mission agency databases, a 
World Wide Web user interface to the catalog, specifications for a 
comprehensive needs assessment, and specifications for a controlled 
vocabulary for assisting user access to REEIS databases.
    The fiscal year 1998 appropriation of $800,000 allowed for the 
conduct of a comprehensive needs assessment within the REE mission 
agencies and partner institutions; implementation, testing, refining, 
and maintaining the catalog prototype and its Web interface; funding of 
cooperative agreements for enhancing the Cooperative Extension System 
Plan of Work and Reporting System and developing a Human Sciences 
Research Web site; and contract work, currently underway for conducting 
a review of information technology systems for use in developing the 
REEIS system. A portion of fiscal year 1998 funds is also targeted for 
creation of a data dictionary of core REEIS databases and the 
development of detailed specifications for a system design.
    The fiscal year 1999 appropriation of $1,000,000 will allow for the 
preparation of a REEIS system foundation and REEIS prototype. This 
includes the preparation of detailed technical descriptions of core 
REEIS databases; expansion, updating and maintenance of the data 
dictionary; preparation of REEIS architectural alternatives; completion 
of functional and physical system specifications for a system design; 
and development of prototypes.
    The requested increase for fiscal year 2000 is required to achieve 
broad implementation. REEIS will undertake system design, conduct 
benchmark tests of alternative architectures, continue development and 
testing of the REEIS prototype, and launch the operating system. 
Included is the need to conduct ongoing, iterative needs assessments 
within the agency and with its partners to align information system 
products and services with strategic information requirements necessary 
for meeting agency mission and goals and satisfying GPRA reporting 
requirements. Updating and maintenance of technical system assessments, 
conducting ongoing information technology evaluations, and enhancements 
of REEIS user interfaces will be needed to ensure currency and 
responsiveness over the life of the system. This entails the 
enlistment, training, and retention of essential personnel and staff 
and the purchase of computer hardware and software and related computer 
programming and technical services. Additionally, several current 
databases must be enhanced to distinguish the basis of investment--
county, State, or Federal funds--to provide information on planned 
expenditures, and to link investments to accomplishments and impact. 
Initial implementation is expected to be completed by the end of the 
year 2000.
    The strategic information audit, with participation of the REE 
mission agencies and university partners, has been completed and has 
resulted in a comprehensive list of system requirements that will serve 
as input to the development of detailed system specifications for 
REEIS. Currently underway is a comprehensive review of information 
technology systems which will identify a representative set of tools 
and technologies for REEIS development and serve as the basis for 
conducting benchmark studies and developing prototypes.
    The Research, Education, and Economics Information System meets a 
high priority national need for an operational, up-to-date and 
continually responsive national information system. REEIS is being 
designed to meet the data information needs of all REE agencies and 
their university and private sector cooperators. It will link data 
systems on research, education, extension, and economics. To achieve 
effective response for it users, annual maintenance costs will be 
ongoing.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Progress and accomplishments from the REEIS initiative have 
undergone and continue to undergo review and evaluation by the REE 
mission agencies, the REEIS National Steering Committee, our State 
partner institutions, and outside sources. The most recent evaluation 
of this project was conducted at the September, 1998, meeting of the 
REEIS National Steering Committee, comprised of representatives of the 
REE mission agencies, university partners, and other stakeholders. The 
evaluation specifically targeted preliminary findings from the REEIS 
Needs Assessment that were based on responses from a series of focus 
groups and interview sessions of policy officials, senior managers, and 
other stakeholders within the USDA/State university land-grant system. 
In addition, three work groups comprised of members of the Committee 
were charged with evaluating and critiquing a detailed questionnaire 
for use in completing the final segment of the needs assessment, 
serving as participants in an actual focus group session and critiquing 
its methodology, and reviewing and critiquing the Web version of the 
REEIS Database Catalog. Both oral and written reports from these work 
groups were presented and several of the work groups' recommendations 
are being implemented. Evaluations by REE agency policy officials, 
budget and GPRA staff, national program leaders, and senior managers of 
the final set of system requirements resulting from the needs 
assessment have been scheduled for completion by spring of 1999.
                     geographic information system
    Question. Please provide a description of the research that has 
been funded under the geographic information system program.
    Answer. The purpose of this program is to promote collaborative and 
innovative transfer of systems technologies to state and local 
governments and others in the public and private sectors. The current 
program is being carried out by the non-profit National Center for 
Resource Innovations. The directors and participants of the Center are 
the sub-contractors who are carrying out the program by working on 
agro-environmental problems at the national, regional, state, and 
neighborhood levels. They represent a wide spectrum of site-based 
expertise including four academic institutions, one regional 
development authority, one non-profit corporation, and the Southwest 
Indian Polytechnic Institute site added by Congress in 1997. This 
institutional arrangement has helped fill a role in linking some of the 
otherwise disparate efforts of agencies and academic institutions to 
apply them in the now seven regions of the country.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher believes that local officials are 
facing increasingly complex land management issues that require rapid 
access to resource knowledge and databases for decisionmaking. This 
project is needed to transfer relevant technology to state and local 
governments, including Native American communities, whose limited 
training budgets and sometimes-isolated location make it difficult to 
use the latest technology. The technology developed in the Center 
program is useful in improving the management of natural resources. 
While concentrating on issues related to agriculture, the independent, 
non-profit nature of the National Center for Resource Innovations 
facilitates linkages across disciplinary and institutional barriers and 
makes it possible to use analyses at the state and local levels which 
were initiated at the Federal level. While the early phases of the 
geographic information system concentrated on building information 
systems related to rural, physical, and natural resources, the current 
challenge is to integrate human economic, social, and demographic 
information in order to better understand the relationship of human 
communities to the landscape. At the other end of the spatial scale, 
the role of the public sector in geographic information system-based 
precision farming technologies, data capture, and information synthesis 
is the subject of a current study group.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal of this work was to serve as a pilot 
project for the transfer of geographic information systems technology 
related to natural resources to local governments.
    The Center has carried out this function. Economic and biological 
data are being presented in various formats to state and local 
governments and individuals. Through its seven regionally distributed 
sites, including the new Southwest Indian Polytechnic Institute site in 
New Mexico, the Center has implemented a variety of geographic systems 
technologies to local governments--both rural and urban. These include 
the recent expansion of transfer of geographic information technology 
through various distance education and Internet technologies.
    It is anticipated that the fiscal year 1999 grant will support work 
under this program through March 2000. The proposal for this work in 
1999 has been received and reviewed.
    Question. How long has this work been under way and how much has 
been appropriated through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1990, $494,000; fiscal year 1991, $747,000; fiscal 
years 1992 and 1993, $1,000,000 per year; fiscal year 1994, $1,011,000; 
fiscal year 1995, $877,000; fiscal year 1996, $939,000; and fiscal 
years 1997 through 1999, $844,000 per year. A total of $8,600,000 has 
been appropriated since the beginning of the program.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. To date, the work in this program for fiscal year 1990 
through fiscal year 1997, had $5,009,834 in non-federal support. In 
fiscal year 1990, non-federal support was $714,940 consisting of 
equipment, databases, and other miscellaneous contributions from 
foundations, city, and state governments. In fiscal year 1991, non-
federal support was $25,000 from county government. In fiscal year 
1992, non-federal support was $366,016 from county government, computer 
companies, and state governments consisting of equipment, software, 
facilities, and miscellaneous support. In fiscal year 1993, non-Federal 
support was $713,900 consisting of financial and miscellaneous support 
from foundations, county and state governments. In fiscal year 1994, 
the non-federal support was $713,643. In fiscal year 1995, the non-
federal support was $987,000. In fiscal year 1996, it was $567,173. It 
was $456,582 in fiscal year 1997. In 1998, non-federal dollars exceeded 
$1,000,000, and it is anticipated that they will again in 1999.
    Question. Where is this work being carried out?
    Answer. The National Center for Resource Innovation-Chesapeake Bay 
is located in Rosslyn, Virginia. This group is working under a 
cooperative agreement with the U.S. Department of Agriculture's Natural 
Resources Conservation Service to work with 13 northeastern states. The 
southeastern center in Valdosta, Georgia, in affiliation with the South 
Georgia Regional Development Center, has developed a comprehensive plan 
of the City of Adel as a model for other urban centers in the ten-
county region. The southwestern center, in Fayetteville-Arkansas, 
serves several local governments through its training facilities at the 
University of Arkansas, basing its technical approach on expertise and 
past experiences with the Federally-developed system known as GRASS. 
They have developed pilot projects for some local jurisdictions and 
state level databases, which they have provided online. Central 
Washington University focuses on training for state planning and on 
three local governments and the Yakima Nation in the Yakima watershed. 
The north central center in Grand Forks, North Dakota, in affiliation 
with the University of North Dakota, focuses on relating real time 
weather data to other spatial attributes. The University of Wisconsin-
Madison, functioning as the Great Lakes center, continues a long 
history of involvement in the application of this technology at the 
local level with strong focus on soils/land-use and the institutional 
aspects of the integration of a new technology. Native American 
communities are being reached through the newly-developed Southwestern 
Indian Polytechnic Institute facilities in Albuquerque, New Mexico.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives to build institutional frameworks 
for developing and disseminating geographic and related information to 
local decisionmakers is constantly evolving. Each site has developed 
approaches to addressing regional needs for modern technologies, and 
many innovative applications have been implemented. Technologies, 
including Internet-based educational and information exchange, have 
been developed to respond to the Center's customers. The Center has 
been asked to include these new technologies in order to bring its 
primarily rural users into new eras of public education and information 
management.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Proposals have been internally reviewed by Departmental 
personnel in different agencies. Beginning in 1995, the program has 
also been externally reviewed by local advisory committees and 
qualified professionals inside and outside of government. Their various 
comments and suggestions are sent to the agency for merit reviews.
                     gulf coast shrimp aquaculture
    Question. Please provide a description of the research that has 
been funded under the Gulf Coast Shrimp Aquaculture grant.
    Answer. Research funded under this program has provided much of the 
required information necessary for a viable U.S. marine shrimp farming 
industry. Studies have been conducted on biosecurity and environmental 
protection in shrimp production systems, prevention and detection of 
diseases via molecular biological techniques, and the development of 
high health and genetically-improved stocks for seed production. 
Performance trials on selected stocks in various production systems 
have been conducted, and seed production systems have reached 
commercial feasibility. A number of important viral pathogens of marine 
shrimp have been identified and protocols have been established for the 
detection of these viral pathogens that have decimated the shrimp 
industry world-wide. Improved viral detection techniques have led to 
the development of specific pathogen-free stocks of commercial 
importance. Researchers have responded rapidly to viral infections that 
have impacted the U.S. shrimp farming industry. Researchers will 
intensify efforts aimed at preventing new introductions of exotic viral 
pathogens.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. The principal researcher indicates that there is potential 
to enhance domestic production of marine shrimp through aquaculture in 
order to reduce the approximately $2,000,000,000 annual trade deficit 
in marine shrimp. Research should result in improving the supply of 
high quality seed, improved shrimp health management, improved 
biosecurity and environmental protection, and enhanced production 
efficiency in shrimp culture systems. The U.S. has the opportunity to 
become a major exporter of shrimp seed and broodstock and disease 
control and biosecurity technologies, products, and services.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goal was to increase domestic production of 
marine shrimp through aquaculture. Recent studies have focused on the 
prevention and detection of diseases, production of specific-pathogen 
free and specific-pathogen resistant seed and broodstock, biosecure and 
environmentally-compatible productions systems, and improved feeds and 
feeding strategies for broodstock maturation and larval production. 
Researchers have responded to severe disease outbreaks caused by the 
introduction of exotic viral pathogens into U.S. shrimp farms. 
Diagnostic and disinfection techniques for a number of important viral 
pathogens have been developed. In addition, scientists are currently 
addressing this problem by developing high health genetically-improved 
stocks and evaluating these animals under commercial production 
conditions. Biosecurity protocols and biosecure system technologies 
have been developed to prevent additional introductions of viral 
disease agents and escape of non-native species of shrimp.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year, through fiscal year 1999?
    Answer. Grants have been awarded from funds appropriated as 
follows: fiscal year 1985, $1,050,000; fiscal year 1986, $1,236,000; 
fiscal year 1987, $2,026,000; fiscal year 1988, $2,236,000; fiscal year 
1989, $2,736,000; fiscal year 1990, $3,195,000; fiscal year 1991, 
$3,365,000; fiscal years 1992-1993, $3,500,000 per year; fiscal year 
1994, $3,290,000; fiscal year 1995, $2,852,000; fiscal year 1996, 
$3,054,000; and fiscal years 1997 through 1999, $3,354,000. A total of 
$42,102,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The U.S. Marine Shrimp Farming Consortium--USMSFC--
estimates that non-federal funding for this program approaches 50 
percent of the Federal funding for fiscal years 1991-1997 and 
$1,240,297 in fiscal year 1998. The source of non-federal funding is 
primarily from state and miscellaneous sources.
    Question. Where is this work being carried out?
    Answer. The work is being carried out through grants awarded to the 
Oceanic Institute, Hawaii, and the Gulf Coast Research Laboratory in 
Mississippi. In addition, research is conducted through subcontracts at 
the University of Southern Mississippi, Tufts University, the Waddell 
Mariculture Center in South Carolina, the Texas Agricultural Experiment 
Station, and the University of Arizona.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original specific 
research objectives was 1987. The original specific objectives have 
been met, however broader research goals have not been met. Researchers 
anticipate that the specific research outlined in the current proposal 
will be completed in fiscal year 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. This program is reviewed annually by CSREES Program 
Managers. Participating institutions are required to submit a detailed 
accomplishment report with the submission of each new grant proposal. 
In addition, the agency conducts an in-depth on site review of the 
program every four years. The 1999 review of the program found that the 
progress during the last twelve months has been well documented and the 
proposal is well written. Research objectives are being met and the 
proposed research is consistent with the National Science and 
Technology Council's Strategic Plan for Aquaculture Research and 
Development. Facilities and expertise are very good and the close 
linkages between the researchers involved and the U.S. shrimp farming 
industry has greatly enhanced the commercialization of the research 
findings from this project. The USMSFC continues to address important 
research needs of the industry and has played a critical role in 
developing management strategies for protecting both wild and cultured 
stocks from the introduction of viral pathogens.
                      mariculture, north carolina
    Question. Please provide a description of the research that has 
been funded under the Mariculture, North Carolina grant.
    Answer. The proposal represents a new research and development 
initiative in marine finfish species for commercial aquaculture in the 
U.S. The long-term goal of the project is to develop methods for mass 
propagation of marine finfish for commercial cultivation and possible 
stock enhancement. Specific objectives include: development of captive 
sexually-mature snapper broodstock; control of maturation and 
reproduction; standardize methods for induced and natural spawning of 
conditioned fish; and establish environmental conditions for rearing of 
larvae. The proposal is put through the university's peer review 
process and is reviewed by the CSREES Program Manager.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. The researchers indicate that there is a regional and 
national need to develop aquacultural production systems for a variety 
of marine finfish. The researchers also indicate that the proposed 
research is consistent with the National Science and Technology 
Council's--NSTC--Strategic Plan for Aquaculture Research and 
Development.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The goal of this research program is to develop sustainable 
aquaculture production systems for marine finfish. The researchers are 
developing culture technologies and evaluating marine finfish species 
that have potential for commercial aquaculture production. Captive 
snapper were successfully matured and spawned and larvae reared through 
juvenile stages. Juveniles were supplied to commercial and governmental 
organizations for grow-out trials. Initial results appear promising 
with good survival rates and excellent feed conversion ratios.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998. 
The appropriation for fiscal year 1998 was $150,000, and for fiscal 
year 1999 is $250,000. A total of $400,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The university estimates a minimum of $115,000 of non-
federal funding in fiscal year 1998 primarily from state and private 
sources.
    Question. Where is this work being carried out?
    Answer. The research will be conducted at the Center for Marine 
Science Research at the University of North Carolina at Wilmington.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is fiscal year 1999. The project was initiated in fiscal year 1998.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the progress of this project on an 
annual basis. The university is required to submit an accomplishment 
report each year when the new proposal is submitted to CSREES for 
funding. The researchers have been asked to develop a research proposal 
consistent with the NSTC's Strategic Plans for Aquaculture Research and 
Development. The proposal is well-written and the objectives are 
clearly stated. The methodology and experimental design are generally 
sound. The research is relevant and addresses a potential opportunity 
for the aquaculture industry. The feasibility of attaining the 
objectives of the proposed research is good. The researcher is well 
qualified and has the appropriate background to conduct the research. 
Facilities are adequate and would be enhanced through this grant.
                  mississippi valley state university
    Question. Please provide a description of the project that has been 
funded under the Curriculum Development and Strengthening-Mississippi 
Valley State University grant.
    Answer. Academic programs have been broadened to include more 
agriculture-related courses consistent with the needs of students from 
the Mississippi Delta. Funds were used for curriculum development and 
to generally strengthen academic programs, including accreditation and 
reaccreditation efforts. Of the ten programs eligible for 
accreditation, nine have been accredited. Courses continue to be 
modified to reflect the needs of graduates as well as employers in the 
Mississippi Delta, with particular emphasis on those areas that 
employers have the greatest need. The funds continue to provide 
enhancements related to other program and administrative 
responsibilities support areas that positively impact program delivery 
and administration at Mississippi Valley State University. Curriculum 
additions have had a positive impact on student enrollment. The project 
has been merit reviewed.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
proposal?
    Answer. The primary need for this project is to satisfy a state and 
local need. The need is for strengthening university capacity and 
curriculum development at Mississippi Valley State University. Emphasis 
has been on degree programs that produce graduates with potential for 
improving the quality of life in rural areas. The Criminal Justice 
program has been developed and administered in a departmental unit with 
social work to provide for improved administration and academic 
counseling. A master's degree program in Criminal Justice is now 
offered. The baccalaureate major in Elementary education has been 
reinstated.
    Question. What was the original goal of this project and what has 
been accomplished to date?
    Answer. The original goal was to provide funding to strengthen the 
academic programs of the university. The academic programs have been 
strengthened as evidenced by student recruitment, which has improved to 
show a positive ratio between applications received and students 
admitted. Approximately one half of the applicants are enrolled. 
Increased quality of instruction and programs have benefitted students. 
This is reflected in the higher graduation rate, increased student 
enrollment, enriched faculty, and improved community relationship.
    Question. How long has this work been underway and how much has 
been appropriated, by fiscal year, through fiscal year 1999?
    Answer. This program was initiated in fiscal year 1987. Grants have 
been awarded from funds appropriated as follows: fiscal year 1987, 
$750,000; fiscal years 1988 and 1989, $625,000 per year; fiscal year 
1990, $617,000; fiscal year 1991, $642,000; fiscal years 1992 and 1993, 
$668,000 per year; fiscal year 1994, $593,000; fiscal year 1995, 
$544,000; fiscal years 1996-1999, $583,000 per year. A total of 
$8,064,000 was appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Mississippi Valley State University provided reports to 
document State and private funding during the period of this grant. The 
State figures provided here are for enhancement funds gained above the 
University's standard formula generated funds. The sources and amounts 
are as listed:

                                                     SOURCE
----------------------------------------------------------------------------------------------------------------
                           Fiscal year                                 State          Private          Total
----------------------------------------------------------------------------------------------------------------
1987............................................................  ..............        $168,640        $168,640
1988............................................................  ..............         186,036         186,036
1989............................................................         $68,658         190,258         258,916
1990............................................................         207,879         369,358         577,237
1991............................................................         333,263         337,700         670,963
1992............................................................         349,427         470,220         819,647
1993............................................................          35,750         358,680         394,430
1994............................................................         590,890         568,970       1,159,860
1995............................................................         841,654         530,300       1,371,954
1996............................................................       1,197,917         590,824       1,788,741
1997............................................................         309,717         755,629       1,065,346
1998............................................................         313,738         538,423         852,161
----------------------------------------------------------------------------------------------------------------

    Question. Where is this work being carried out?
    Answer. The program has been carried out on the campus at Itta Bena 
and at off-campus sites in Anguilla and Greenville and the Greenwood 
Center since the Spring Semester of 1996.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objectives completion date was June 1992, and 
the primary objective of erasing the financial deficit was accomplished 
at that time. The university has been operating on a sound financial 
basis as of July 1993. Curriculum and strengthening objectives are 
progressing very well. The objective of the current grant will be 
completed by September 30, 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The program has been evaluated on an annual basis by the 
agency. The annual progress report for fiscal year 1998 revealed 
progress in the academic programs. For example, the Social Work 
Department had significant positive changes in the quantity and quality 
of the faculty. The Business Department offered a component dealing 
with Agricultural land lease in the business law classes, and the other 
classes had topics on input and output analysis, agricultural 
stimulations, and initial farm planning. The major objectives of this 
project have been met. The funds are now used to maintain the level 
attained since receiving these funds. The fiscal year 1999 proposal 
will be peer reviewed. The last on-site visit was conducted on April 
21-23, 1993. Mississippi Valley State University has responded 
positively to recommendations of the on-site review team. The 
university has implemented a time and effort reporting system. Funds 
are requested on a reimbursable basis and are deposited in interest 
bearing accounts. The payment method for receiving USDA funds was 
changed to the electronic transfer system. Property acquired through 
Federal Grants are identified as such in the university property 
records, and the Drug-Free Workplace Policy had been implemented.
                 national alternative fuels laboratory
    Question. Please provide a description of the research that has 
been funded under the National Alternative Fuels Laboratory--NAFL--
grant.
    Answer. Through a nationally-marketed collaboration program in 
which the NAFL matches about half of its USDA funding with non-federal 
money to work on industry-relevant projects, NAFL researchers have (1) 
resolved ethanol-in-gasoline performance and environmental issues to 
accelerate the use of ethanol, (2) developed a lead-free ethanol-and 
biodiesel-containing alternative to leaded aviation gasoline, (3) 
initiated new biomass fuel technologies including an agricultural co-
products-to-ethanol process and an ethanol extraction process for 
removing contamination from fungus-infected wheat and barley, (4) 
initiated a program to increase E85--85 percent ethanol-15 percent 
gasoline--fuel economy and evaluate automobile exhaust emissions, (5) 
initiated and coordinated the 27-member Red River Valley Clean Cities--
RRVCC--Coalition to increase the number of alternative fuel vehicles in 
regional public and private fleets, and (6) built E85 refueling sites 
in North Dakota.
    Question. According to the research proposal or the principal 
researcher, what is the national, regional, or local need for this 
research.
    Answer. Our Nation needs to develop commercially-viable 
alternatives to fossil fuels to ensure energy security, improve air 
quality, and provide employment. It is crucial to national security and 
economic development that these new fuels are accurately represented in 
the marketplace and given an opportunity to compete fairly with 
traditional fossil fuels. The NAFL provides unbiased scientific data on 
fuel performance and environmental effects. Regional need for the 
research derives from the need to support regional agriculture and 
associated industries through (1) development of economic uses for 
agricultural co-products and (2) development of economic uses for 
mycotoxin-contaminated grains.
    Question. What was the original goal of this research, and what has 
been accomplished to date?
    Answer. The primary original goal was to develop a database of at-
the-pump-sampled conventional, reformulated, and alternative 
transportation fuels sold in the upper Midwest and throughout the U.S. 
to enable comparison of current and historical fuels on the basis of 
chemical and physical properties. The database is being expanded to 
include how gasoline chemistry affects air quality and fuel 
performance. Another original goal was to provide information on 
conversion of crop residues, agriculture processing wastes, high-
cellulose content municipal wastes, and other biomass materials to 
alternative fuels. The NAFL program supported North Dakota's first two 
public E85 refueling sites, an ongoing industry-supported effort to 
develop and build a new ethanol plant in the Grand Forks region, and 
resolved ethanol blend fuel economy and tailpipe emissions issues, and 
E85 engine cold-start problems.
    Question. How long has this work been underway, and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The NAFL work began in fiscal year 1991 and was, in part, 
sponsored by this grant. USDA appropriations in fiscal year 1991 
through fiscal year 1993 were $250,000 per year. Later awards were 
$235,000 in fiscal year 1994, $204,000 in fiscal year 1995, and 
$218,000 per year in fiscal years 1996 through 1999. A total of 
$2,061,000 has been appropriated over 9 years.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. To date, in fiscal year 1998, more than $60,000 in non-
federal collaborative funding has been secured from corn grower 
organizations, a state public service department, alternative fuels 
technology companies, the city of Winnipeg, and Ford Motor Company. An 
additional $40,000 in fiscal year 1998 non-federal funding is 
anticipated through projects proposed to the Kraus Group--an 
alternative fuels technology provider--and the Minnesota Chamber of 
Commerce. A total of $1,045,000 in non-federal funds has been secured 
for performance of NAFL program objectives over the duration of this 
grant. During fiscal year 1991 through fiscal year 1993, non-federal 
funding from the State of Illinois totaled $630,000. For fiscal year 
1994, non-federal funding of $105,000 was secured from the American 
Corn Growers' Association, the Renewable Fuels Association, and others. 
fiscal years 1995, 1996, and 1997 non-federal funding totals of 
$50,000, $60,000, and $140,000, respectively, were secured from corn 
grower organizations, state agriculture departments, alternative fuels 
technology companies, and regional economic development agencies.
    Question. Where is this work being carried out?
    Answer. The University of North Dakota Energy and Environmental 
Research Center--EERC--located in Grand Forks performs this work. The 
EERC is a research, development, demonstration, and commercialization 
facility that employs about 200 scientists, technicians, and support 
personnel.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The completion date for the original objectives was April 
30, 1992. The objectives were met. The work was then expanded to 
include partnerships with industry and agriculture. NAFL has been 
established as a center of expertise for development and demonstration 
of bio-based fuels, investigating fuel chemistry effects on engine 
performance and air quality, dissemination of accurate and objective 
information regarding ethanol in gasoline, and ethanol feedstock 
assessment and process development. Additional tasks which have been 
added include: the Red River Valley Clean Cities Coalition, 
implementing agricultural co-product-to-ethanol plant project, and 
commercializing an ethanol-based aviation fuel. These tasks should be 
completed by 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation.
    Answer. In June of 1998, the U.S. Department of Agriculture 
conducted an on-site evaluation, and the NAFL program was given a very 
favorable review. The program continues to be a model for Federal-
private sector collaborations. Personnel have continued to meet or 
exceed program objectives detailed at the initiation of each annual 
performance period.
               national center for peanut competitiveness
    Question. Please provide a description of the research that has 
been funded under the National Center for Peanut Competitiveness.
    Answer. The grant supports an interdisciplinary research and 
education program to enhance the competitiveness of the U.S. peanut 
industry by examining alternative production systems, developing new 
products and new markets, and improving product safety.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional, or local need for this 
research?
    Answer. Peanuts are a very important crop in several southern 
states. In many counties, peanuts provide more than 50 percent of all 
crop income. Peanut producers have been major beneficiaries of 
government income protection programs, but Federal farm and trade 
policies are changing and producers must become more competitive and 
market oriented.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The project helps peanut producers be more competitive in 
the global market. In the first year of the project--1998--a 
computerized expert system was adapted for hand-held computers that 
were used to help farmers reduce pest control costs. In addition, 
economic factors were added to a computerized disease risk management 
system which includes a large number of factors involved in the onset 
of a very destructive wilt. For every one-point improvement in the 
``wilt index,'' a farmer's net income is increased $9-14 an acre. USDA 
funds were used to leverage an additional $124,000 for research by the 
Center for Peanut Competitiveness.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998 
with an appropriation of $150,000. The appropriation for fiscal year 
1999 is $300,000, making a total of $450,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In fiscal year 1998, the state of Georgia contributed 
$141,181 and the state of Alabama, $15,000.
    Question. Where is this work being carried out?
    Answer. The Center is located at the University of Georgia at 
Griffen and involves cooperators from nearby peanut producing states, 
such as Auburn University in Alabama.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1998 was for a period of 36 
months, however, the need to improve the competitiveness of U.S. peanut 
growers continues to grow. The fiscal year 1999 proposal extends the 
project until 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES reviewed and approved the project proposal in 
February 1998. We believe its scientific objectives and procedures will 
enable the Center to improve the competitiveness of U.S. peanut 
producers.
                 pm-10 study, california and washington
    Question. Please provide a description of the research that has 
been funded under the PM-10 study, California and Washington research 
grant.
    Answer. The PM-10 study in California and Washington addresses the 
effects of emissions of PM-10 and PM-2.5 sized particulates, or dust, 
from agricultural land on air quality and development of control 
strategies. These studies are being conducted by scientists at the 
University of California-Davis and the Washington State University, in 
cooperation with Federal, state, and local agricultural, environmental, 
and health agencies, and farmers and growers in both states. The 
California program has focused on developing and refining methods to 
accurately measure and detect the sources of PM-10 and PM-2.5 emissions 
from various agricultural practices and to investigate alternative 
practices for reducing potential air pollution on susceptible 
California crops and soils. In addition, the California research has 
been expanded to include dust and gaseous emissions from cattle 
feedlots, dairies, and the poultry industry. This is in direct response 
to the increased public concern with odors and air quality problems 
possibly related to livestock operations. The Washington State 
University scientists are using refined instruments on field sites to 
measure and predict the effects of wind erosion and agricultural 
practices in the Columbia River Basin region on PM-10 and PM-2.5 
emissions, under both natural wind erosion and with portable wind 
tunnel studies. Alternative cropping and tillage practices, residue 
management, and weed control practices are being developed and compared 
for control of PM-10 and PM-2.5 emission pollution under Columbia River 
Basin conditions.
    Question. According to the research proposal, or the principal 
researcher, what is the national, regional or local need for this 
research?
    Answer. There has been growing national concern over the potential 
health and safety aspects of air pollution from dusts and suspended 
particulate matter resulting in passage of the 1990 Clean Air Act, as 
well as state air quality laws in both California and Washington. 
Because of particular problems from PM-10 and PM-2.5 emission in the 
arid regions of the Western United States, research on the role of 
agricultural operations in intensively cultivated soils in California 
and the Columbia River Basin, as sources of PM-10 and PM-2.5 pollution, 
will assist growers to develop alternative agricultural management 
practices to control PM-10 and PM-2.5 emissions.
    Question. What was the original goal of this research and what has 
been accomplished to date?
    Answer. The original goals of this research were to measure the PM-
10 emission rates from significant crop and tillage practices, to 
determine the source of PM-10 emissions on soils in agricultural 
regions of central and southern California and the Columbia River Basin 
in the Pacific Northwest, and to explore cost-effective alternative 
agricultural practices to control these emissions. More recently, 
studies of finer PM-2.5 particulates have been included because of 
their recognized potential health risks. In California, field 
measurements are being continued on both PM-2.5 and PM-10 emissions on 
production practices on almonds, figs, walnuts, cotton, wheat, and on 
ammonia emissions from dairy farms and feedlots. Similar studies in the 
Columbia River Basin are being conducted in Washington on a number of 
agricultural practices in the rain-fed and dryland croplands. 
Susceptible climatic and soil conditions and tillage and cropping 
practices have been identified and are being used to develop prediction 
tools to assist growers to adopt alternative practices to reduce 
potential air pollution by PM-10 and PM-2.5 particulate emissions.
    A Light Detection and Ranging system has been developed at the 
University of California at Davis that makes it possible to take a 
snapshot of the shape of an emission plume from a source such as a 
harvester, and to make estimates on the amount of particulate material 
emitted into the atmosphere and its subsequent transport.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant began in March 1994. The 
appropriation for fiscal year 1994 was $940,000; fiscal year 1995, 
$815,000; and for fiscal years 1996 through 1999, $873,000 per year. A 
total of $5,247,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. In California, the program is matched by State funds in the 
form of salaries, benefits, and operating costs. In Washington, there 
were no state or non-Federal funds in support of the PM-10 project in 
1994 and 1995. In 1996, state support was $22,566, and in 1997, state 
support was $102,364. Similar funding was continued in 1998.
    Question. Where is this work being carried out?
    Answer. This work is being directed by participating scientists at 
the University of California-Davis and at the Washington State 
University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date of the original objectives 
of this project is 2000. The first four objectives of the project on 
soil particle characterization are anticipated to be completed in 1999. 
The objectives on field control will continue. In 1998, a manual for 
practices was developed and circulated for use by growers in Washington 
State to reduce wind erosion on agricultural land. Implementation and 
development of these management practices will be a major role of this 
project in the future. Quarterly and annual reports on the Washington 
State project to date are available.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency's Program Manager annually reviews the research 
progress reports and proposed new research and attends the annual 
meetings of the program to assess progress. The program is also 
evaluated each year by technical, administrative, and agency personnel. 
Progress is reported at research review meetings three times a year, 
with the November 1998 meeting in Washington involving strong 
participation of a large number of growers and public advisory 
committee members. A formal on-site review by a panel of experts was 
conducted of the Washington program in November 1997, and a similar 
review of the California program is planned in the near future.
                          ag in the classroom
    Question. Please provide a description of the research that has 
been funded under the Ag in the Classroom grant.
    Answer. Ag in the Classroom is an extension outreach program 
designed to promote agricultural literacy among pre K-12 students. 
Funds appropriated for this program are used to leverage agricultural 
literacy activities in all 50 states, the District of Columbia, and 
U.S. territories by providing national leadership and guidance to the 
agricultural education community. This community serves the educational 
needs of more than 5,000,000 students through a network of more than 
120,000 teachers.
    Question. What is the national, regional, or local need for this 
project?
    Answer. This extension outreach program is directed toward the 
youth of America. In the Federal Agriculture Improvement and Reform Act 
of 1996--Public Law 104-127--Congress stated the importance of 
increasing the number of young Americans pursuing a baccalaureate or 
higher degrees in the food and agricultural sciences--section 805d. 
Agricultural literacy is a first step in creating both an interest and 
awareness of career opportunities in the food and agricultural 
sciences.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The original purpose of this extension outreach program was 
to promote agricultural literacy among this nation's youth. The 
Secretary of Agriculture established the Ag in the Classroom Program in 
1981 to help ensure that future generations are agriculturally 
literate. The mission of Ag in the Classroom is to help K-12 students 
understand the complexity of the total food and fiber system, 
appreciate its impact on our economy and society, and become citizens 
who are able to support wise agricultural policies. The Program 
encourages educators to integrate the critical role of agriculture in 
our economy and society into their teaching. The Program helps 
coordinate programs in all 50 states, the District of Columbia, and the 
U.S. territories. It provides leadership, counsel, and educational 
materials, and maintains a nationwide network of individual farmers, 
educators, agribusinesses, and local government officials who actively 
support the Ag in the Classroom mission.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal years to date?
    Answer. A total of $2,253,880 has been appropriated for this 
program as follows: fiscal year 1986, $76,000; fiscal years 1987 and 
1988, $74,000 per year; fiscal year 1989 $87,000; fiscal year 1990, 
$135,000; fiscal year 1991, $170,000; fiscal years 1992 and 1993, 
$208,000 per year; fiscal year 1994, $185,000; fiscal year 1995, 
$208,000; fiscal year 1996, $204,880; and fiscal years 1997 through 
1999, $208,000 per year.
    Question. What is the source and amount of non-Federal funds 
provided by fiscal year?
    Answer. This is not a grants program and does not require matching 
funds. However, the original intent was to have an Ag in the Classroom 
Program in all 50 states, the District of Columbia, and in the U.S. 
territories. This has been accomplished. These state programs receive 
no Federal dollars. Thus, the Federal Ag in the Classroom Program is 
highly leveraged, albeit indirectly, because the states support their 
own activities.
    Question. Where is the work being carried out?
    Answer. The work of Ag in the Classroom is being carried out in all 
50 states, the District of Columbia, and in the U.S. territories. The 
national program impacts an estimated 120,000 teachers and over 
5,000,000 students in grades K-12.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related activities?
    Answer. Ag in the Classroom is an extension outreach program. Given 
the original goals of the program were to promote agricultural literacy 
among America's youth and that we do not have a population fixed in 
time, this is a continuing effort. Indeed, as each generation becomes 
further removed from the agricultural heritage of this Nation, the need 
for Ag in the Classroom becomes more paramount.
    Current plans include the development of cooperative support 
agreements to develop a high quality web site to coordinate activities 
and curriculum modules among each of the Ag in the Classroom state 
coordinators, sponsor national teaching awards at the K-12 level, and 
to streamline the development and dissemination of materials. Ag in the 
Classroom will also continue its role in sponsoring the coordination of 
a national, annual conference, for the purpose of bringing the Ag in 
the Classroom community together to share experiences, ideas, 
materials, information, and techniques among state programs, educators, 
governmental agencies, agribusinesses and agricultural organizations.
    The state Ag in the Classroom Program coordinators--including the 
District of Columbia and the U.S. territories--have formed a National 
Ag in the Classroom Consortium.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Several efforts have been made to evaluate various aspects 
of the Ag in the Classroom program. A survey was conducted of 
constituents through the Ag in the Classroom newsletter evaluating the 
population affiliation to and involvement with Ag in the Classroom and 
topics that would affect the future direction of projects within the 
program. Findings from this survey indicated that readers wanted to 
know specific information about successful projects/program in the Ag 
in the Classroom community, access to age-specific lesson plans, 
updates on resource guides, and information on specific agricultural 
topics. The respondents were highly supportive of Ag in the Classroom.
    During the annual national conference, formal evaluations were 
conducted regarding the conference and future projects. Findings from 
these conferences indicated that the target audience found the 
conference extremely valuable for sharing ideas on local Ag in the 
Classroom projects/programs. In addition, they found the conference 
very useful for obtaining resource materials. Conference attendees 
indicated that they would like to see attention focused at the national 
level to develop a ``teacher friendly'' web site. They also indicated 
an interest in materials associated with agricultures' environmentalism 
role. A third issue that arose is the need for the national level to 
continue its role in the dissemination of resource guides and 
materials.
    The National Ag in the Classroom Consortium provides USDA with 
another source of stakeholder input for assistance in identifying and 
setting priorities. Evaluations have been conducted in several states 
by the state coordinator on different projects such as: newsletters, 
videos, and various other products/activities. Many of these findings 
are brought forward to the Executive Committee of the National Ag in 
the Classroom Consortium. Comments are then brought forward from the 
Executive Committee to the attention of the National Program Leader 
through a monthly conference call. This provides a model for continuous 
process improvement.
                       beef improvement--arkansas
    Question. Please provide a description of the program that has been 
funded as the Arkansas Beef Improvement Program.
    Answer. The Arkansas Beef Improvement Program uses three 
educational methods to demonstrate the decision making process and 
cost-effective management practices. The educational methods include 
demonstration farms that are enrolled in the program for five years, 
county workshops conducted over three evenings for two hours each 
evening, and five Beef Improvement special projects that were 
implemented this past year. An Arkansas Beef Improvement Executive 
Committee provides the overall direction for the program.
    Question. What is the national, regional or local need for this 
program?
    Answer. The implementation of specific cost-effective management 
practices vary from year to year, region to region, and state to state. 
The primary teaching objective of the Arkansas Beef Improvement Program 
is the decisionmaking process rather than specific management 
practices. Goal setting, evaluation of resources, and the process of 
selecting cost-effective management practices are emphasized in the 
decisionmaking process.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The overall goal of the Arkansas Beef Improvement Program 
was to enhance the efficiency and profitability of the Arkansas cattle 
producer. The program is still using demonstration farms to implement 
and evaluate cost-effective management practices, but during this past 
year, Beef Improvement Special Projects were implemented. There are 
five special projects. They are calving and breeding seasons; pasture 
renovation; hay quality and supplemental feeding; stocker cattle; and 
cow herd performance. Each project has its own requirements and 
objectives. Thirteen counties were selected to participate in the 
projects. Only one project per county was allowed. The objectives for 
the special projects were to concentrate on specific production 
problems and allow a means for more county agents and producers to 
become involved with the Arkansas Beef Improvement Program.
    Additional accomplishments for the Beef Improvement Program.
  --In 1997, four farms completed the five-year Arkansas Beef 
        Improvement program. Their accomplishments included: Mature cow 
        calf crop increased from 85 to 92 percent,Farms increased the 
        average number of mature cows by 68 percent,Total pounds of 
        beef sold per animal unit was 38 pounds higher the fifth year 
        of the program compared to the first year; The average gross 
        margin per farm increased by 138 percent--$28,664 vs. 
        $12,423,If the farms received the same selling price in 1997 as 
        they did in 1993, the average gross margin per animal unit 
        would be 12 percent higher--$129.72 vs. $145.4 andPounds weaned 
        per cow exposed increased 7.1 percent
  --Benchmark data for the four new farms added to the program in 1997 
        were collected. Data included beef cattle production 
        information, cow-calf budgets, soil test, forage test, cow herd 
        performance information, and forage inventory.
  --Arkansas Beef Improvement Workshops were delivered through county 
        Extension offices. Overall, the participants found the workshop 
        to be very meaningful to their operation and planned to 
        implement many of the production practices discussed.
    Question. How long has the program been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. $200,000 has been devoted to this project from Fiscal Years 
1993 through 1995 and in fiscal years 1996 through 1999, $197,000 was 
appropriated for a total of $1,388,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. $95,000 has been provided annually from 1993 to 1997 from 
state funds. Arkansas provided $118,154 this past fiscal year.
    Question. Where is the work being carried out?
    Answer. Since the initiation of the Arkansas Beef Improvement 
Program, ten demonstration farms in Arkansas--from ten different 
counties--completed their fifth year. Currently, there are four 
demonstration farms in the second year of the program. Thirteen Special 
Projects were implemented this past year. Arkansas Beef Improvement 
Workshops were conducted in 17 counties. Therefore, 44 counties have 
participated in the Arkansas Beef Improvement Program. By involving 
more counties, a better representation of the Arkansas cattle industry 
was obtained.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. Currently there are four demonstration farms enrolled in 
the program. These farms are on their second year. It was agreed the 
Extension team would work with these farms for five years. Data from 
the final year as well as an Arkansas Beef Improvement Producer Survey 
and County Agent Survey will be collected and summarized for 
evaluation. Commitments to the Arkansas Beef Improvement Special 
Projects vary in length, depending on the project and farm situation. 
Most Special Projects will last 3 to 5 years. The first year of the 
Special Projects is primarily devoted to collection of benchmark data. 
In the second year, management practices are implemented and the impact 
measured. The Arkansas Beef Improvement Workshops are an ongoing 
program in the counties.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A CSREES review of the project is conducted annually. The 
1998 review noted the project is taking a sound approach to improving 
beef production efficiency and profitability in Arkansas. The review 
advised that project results and materials be widely disseminated 
through publications and educational programs for the benefit of other 
producers in Arkansas and beyond.
                         delta teachers academy
    Question. Please provide a description of the program that has been 
funded under the Delta Teachers Academy project.
    Answer. The National Academy proposes to continue its Delta 
Teachers Academy in the Lower Mississippi Delta Region--a region of 219 
counties and parishes clustered around the Mississippi River 
encompassing portions of Arkansas, Illinois, Kentucky, Louisiana, 
Mississippi, Missouri, and Tennessee--focusing on educational 
improvement in the core subject areas. Specifically, the program will 
provide long-term academic enrichment to approximately 525 elementary 
and secondary school teachers at 35 sites by teaming them with 
university scholars for in-service training sessions during the school 
year and continuing with summer institutes. Through its Fellows Program 
the Delta Teachers Academy will also sustain the professional 
development of over 650 Academy graduates throughout the region. The 
Delta Teachers Academy grant is not awarded competitively; however, we 
require annual applications reporting the previous year's 
accomplishments and describing activities and expenditures planned for 
the upcoming year. These applications undergo merit review by at least 
three of our Ph.D. level staff before grant awards are made.
    Question. What is the national, regional, or local need for this 
project?
    Answer. According to the grant recipient, 33 percent of the 
children in the 219-county area comprising the Lower Mississippi Delta 
region live below the poverty line compared to 20.5 percent nationally. 
In 1996 the Children's Defense Fund stated that seven out of ten poor 
Southern families with children had at least one working family member. 
In 1996, 60 percent of Louisiana's public schools sampled ranked 
``below basic'' on the National Assessment of Education Progress test 
for eighth-graders. Poor educational performance, rural poverty, and 
limited economic development are strongly correlated as depicted in a 
1995 report from USDA's Economic Research Service. In its report to 
Congress in 1990, the Delta Development Commission cited serious 
educational problems including poor student performance in core content 
areas, demoralized teachers with little or no opportunity for academic 
development, and region-wide difficulty in recruiting and retaining 
qualified teachers. The Commission also stressed the links between 
these problems and the pervasive poverty and depressed economic 
conditions that characterize much of the seven-state Delta region. The 
Commission's report also cited that 75 percent of the region's 
workforce lacks the basic reading skills necessary for technical 
training and specifically cites the need for improved teacher training 
as one means for breaking the cycle of poverty and economic non-
competitiveness.
    Question. What was the original goal of the program and what has 
been accomplished to date?
    Answer. The original and continuing goal of the project is to 
address the problem of insufficient professional development 
opportunities for the elementary and secondary teachers of the seven-
state region. The Academy project has focused on the core subjects of 
English, geography, history, mathematics, and science. Humanities, 
language arts, social studies, reading, civics, and interdisciplinary 
subjects are also covered by some sites. The Delta Teachers Academy 
began by offering educational development activities for 100 teachers 
from approximately 50 rural districts at 10 sites. Training has now 
been expanded to include 525 teachers at 35 new sites across the entire 
seven-state region. In addition, there are over 650 graduates of the 
program whose professional development is sustained through the 
Academy's Fellows Program and who are leading teacher in-service 
training back at their home schools. The project has helped improve 
student performance and teacher training, morale, recruitment, and 
retention in the region.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. A total of $20,661,000 dollars has been appropriated to the 
Department of Agriculture for this project, including $2,000,000 
dollars in fiscal year 1994, $3,935,000 dollars in fiscal year 1995, 
$3,876,000 dollars in fiscal year 1996, $3,850,000 dollars in fiscal 
year 1997, and $3,500,000 dollars per year in fiscal years 1998 and 
1999.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. There are no non-federal funds identified for this project.
    Question. Where is the work being carried out?
    Answer. The Delta Teachers Academy project is coordinated out of 
The National Faculty's Southern Region office in New Orleans, 
Louisiana. The project is being conducted at 35 sites selected from 
within the seven-state Lower Mississippi Delta region including the 
states of Arkansas, Kentucky, Illinois, Louisiana, Mississippi, 
Missouri, and Tennessee.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original objective was to provide three full years of 
training to each faculty team established by the Delta Teachers Academy 
program. Training consists of four two-day academic sessions and one 
two-week summer institute for each team. This objective has been met 
for the original 24 faculty teams first funded under the Fiscal Year 
1994 Department of Agriculture grant, for the 15 additional teams 
established in 1995, and for the one new team established in fiscal 
year 1996. The 20 new teams established in fiscal year 1997 have 
received two years of training, and the 14 new teams established in 
fiscal year 1998 have received one year of training. As of the end of 
the Fiscal Year 1997 grant, 40 of the 41 faculty teams established by 
the Delta Teachers Academy will have met the original objective of the 
program. Objectives for the fiscal year 1999 grant include providing 
ongoing professional development of 33 teams consisting of 600 
participants; add two additional teams to maintain their general level 
of service to 35 teams throughout the region; instituting several new 
procedures for better meeting their clienteles needs based on the 
independent review completed by Westat; intensify its individual and 
field-based approach; and draft individual work plans for each site. 
The anticipated project completion date for the 35 current sites is 
September 30, 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. An assessment of the short-term impact of the Delta 
Teachers Academy by Westat, Inc. of Rockville, Maryland was completed 
in August 1997. Westat's study found that the vast majority of 
participants reported that the Academy had met their personal and 
professional needs by renewing their enthusiasm for teaching, improving 
their self-confidence, increasing their sense of professionalism, 
improving their knowledge of specific content areas, enhancing their 
teaching methods, and providing opportunities to interact with peers. 
The study also provided considerable evidence that teachers are 
applying what they have learned from the Academy in their own 
classrooms. For example:
  --90 percent reported applying academic content from the program in 
        their classrooms.
  --78 percent reported incorporating skills and strategies learned 
        developed at the Academy into their classroom teaching.
  --83 percent reported that their teaching approaches have become more 
        effective in improving student learning.
  --88 percent said the Academy had prepared them to assume leadership 
        roles in their schools.
  --89 percent noted changes in their students' work habits, attitudes, 
        aspirations, and achievements.
    A United States General Accounting Office review of the Academy's 
programs was also conducted in fiscal year 1995. The General Accounting 
Office report--GAO/RCED-95-208 included summary statistics on over 
1,000 teacher evaluations of Academy sessions as well as the General 
Accounting Office's own survey of participants. The General Accounting 
Office found that on average, participants reported that the Academy 
was more effective than any other teacher development program they had 
participated in, was very effective in renewing or enhancing knowledge 
in one or more academic subjects, and was generally effective in 
enhancing the teaching skills and strategies required for teaching 
challenging academic content.
    In addition, a site visit of the Delta Teachers Academy offices in 
New Orleans, Louisiana and of the National Faculty's Summer Institute 
at Tulane University was conducted by the Cooperative State Research, 
Education, and Extension Service's National Program Leader for Higher 
Education and Evaluation, during July 1996. The site visit confirmed 
that participating teachers are very enthusiastic about the Delta 
Teachers Academy program, that the instruction provided by The National 
Faculty's university scholars is on target and appropriate to the K-12 
teachers' needs, and that the facilities are very well suited to 
program requirements. The site visit further confirmed that the Delta 
Teachers Academy has strengthened the participating teachers' ability 
to teach by improving their content knowledge base, helped them become 
leaders of other teachers by requiring them to conduct staff 
development back at their home schools, and had a positive impact on 
student learning. School superintendents report greater student 
enthusiasm, more homework, and higher test scores for students whose 
teachers were in the Delta Teachers Academy program. As determined by 
such sources as reports from school superintendents, an outside expert 
evaluation, a GAO review, and site visits and merit reviews by Federal 
program staff, it appears that the project has met its original 
objective of providing increased teacher professional development 
opportunities in the seven-state Lower Mississippi Delta Region.
        diabetes detection and prevention, washington and hawaii
    Question. Please provide a description of the extension activity 
that has been funded under the Diabetes Detection and Prevention, 
Washington and Hawaii grant.
    Answer. CSREES has met with representatives of the Joslin Diabetes 
Centers and conversed with representatives of its State Cooperative 
Extension Partners in Washington and Hawaii. The grant will support 
demonstration and outreach activities designed to detect undiagnosed 
diabetes through use of a non-invasive ocular fluorescence technique. 
CSREES has requested that a revised proposal be submitted from the 
Joslin Diabetes Center.
    Question. According to the proposal, or the project director, what 
is the national, regional or local need for this extension program?
    Answer. The need for this demonstration program grows out of a need 
to reach more of the millions of Americans who have undiagnosed 
diabetes. Diabetes is currently one of the leading causes of death and 
disability in the U.S. adult population, and is highest among certain 
racial and ethnic populations, especially Native Americans, African 
Americans, Hispanic Americans, and Asians and Pacific Islanders.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The goal of this extension outreach project will be to 
provide (1) screening for diabetes among selected rural minority 
patient populations in Washington and Hawaii using innovative detection 
technology and blood glucose measures; (2) diabetes education 
prevention and care materials; and (3) case management support and 
follow-up services for patient referrals.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The work supported by this grant begins in fiscal year 1999 
and the appropriation for fiscal year 1999 is $550,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. There are no non-federal funds and sources expected for 
this grant.
    Question. Where is this work being carried out?
    Answer. The program will be conducted at Joslin Diabetes Centers at 
Swedish Hospital in Seattle, Washington, and Straub Medical Center in 
Hawaii. In addition, the Cooperative Extension offices in selected 
counties in Hawaii and Washington will be involved in program 
implementation.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date for the original objectives 
is 2002.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Because this is the first year of the project's funding, 
and it is in fact just getting underway, the Agency evaluation has not 
yet occurred. A mid-year evaluation of program outputs and the delivery 
process to date will occur in July 1999.
  extension specialist, arkansas (small farm management and marketing 
                           education project)
    Question. Please provide a description of the program that has been 
funded under the Small Farm Management and Marketing Education Project.
    Answer. The Small Family Farm Management and Marketing Education 
program provides farm financial education and support materials that 
are necessary for family farm enterprises to develop and maintain an 
effective financial management system for their operations. The program 
is located at the Dale Bumpers Small Farms Research Center located at 
Booneville, Arkansas, in a transition zone where horticultural crops, 
both warm and cool season forages, and ruminant animal issues may be 
researched. It relates to 151,000,000 acres of major land resource area 
in the United States and is specifically representative of 72,000,000 
acres in the upper mid-South. This program extends research on 
technical and efficiency issues to the limited resource hill-land 
family farmers located in the area. The program promotes the use of 
land resources, labor, and capital in a whole-farm context intended to 
sustain small family farms.
    Question. What is the national, regional or local need for this 
program?
    Answer. This program fills the need to evaluate the economic 
applicability of research conducted at the Center and to transfer the 
applicable results to operators of small family farms. This research 
considers the limitations and potentials faced by farmers as they 
decide how to improve their operations through the use of new 
technologies, minimize risk when risk capital is limited, combine 
enterprises on limited acreages to make better use of labor, and select 
and use equipment for multiple enterprises. Within the region and in 
local situations, feasible alternative enterprises are identified and 
methods to improve biological and economic efficiency are advanced. 
Value-added markets are being explored as a means of enhancing incomes 
and promoting the sustainability of small family farms.
    Question. What is the original goal of this program and what has 
been accomplished to date?
    Answer. The goal of the project continues to be to develop a small/
family farm management and marketing education program based upon the 
Center's mission, extend the research information to family farmers in 
the mid-South, provide support to county and state Extension 
professionals providing education on alternative agricultural 
management and marketing, and be a resource to faculty, agency 
personnel, and the public in farm management and marketing. An 
ambitious set of objectives include identifying niche marketing for 
alternative enterprises, encouraging use of computerized farm record 
systems, provide guidance on the development of whole-farm management 
systems, and conduct in-service and other training for relevant groups. 
In fiscal year 1998, the record keeping system was updated to include 
soil tests, fertilizer and chemical use, manure analyses, and other 
measures in addition to financial information. Tested programs and 
procedures in alternative agriculture have been disseminated to more 
than 13,000 producers through Extension publications, newspapers, and 
other media. Assistance has been provided to more than 17,500 
stakeholders in Arkansas, 27 other states, and two foreign countries. 
Program faculty have provided in-depth training on production practices 
and record keeping to 785 producers and worked with an extensive group 
of private and public organizations to form networks that provide 
programming to enhance production, profitability, and longevity in 
family farm enterprises.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The project has been underway since 1992. Appropriations of 
$100,000 have been made in each of the fiscal years 1992 through 1995. 
Appropriations in fiscal year 1996 through fiscal year 1999 were 
$99,000 for each year. A total of $796,000 has been appropriated.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. State matching funds have been provided through the 
Arkansas Cooperative Extension Service in fiscal year 1992 through 
fiscal year 1999. The amounts are $59,040 in fiscal year 1992, $55,680 
in fiscal year 1993, $54,250 in fiscal year 1994, $54,446 in fiscal 
year 1995, $54,446 in fiscal year 1996, $46,347 in fiscal year 1997 and 
$40,467 in fiscal year 1998. The total is $364,676.
    Question. Where is the work being carried out?
    Answer. The central location is the Dale Bumpers Small Farms 
Research Center at Booneville, Arkansas. It is being carried out 
primarily in the 10-state area served by the Center. These states are 
Alabama, Arkansas, Georgia, Kentucky, Louisiana, Mississippi, Missouri, 
Oklahoma, Tennessee and Texas.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal, one year in length, was extended as 
the research results continued to evolve and the educational needs of 
the target audience increased. During the coming year, the emphasis is 
on alternative enterprises, niche marketing, market reporting, farm 
management information, and record keeping. Contact is maintained with 
Extension personnel and other organizations.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A merit review of the current proposal is conducted each 
year when it is received using internal criteria that examine 
objectives, procedures, timelines, anticipated product, and the 
competency and experience of the project directors. The evaluation 
indicates that this is a productive project, especially in terms of its 
outreach. It complements the ongoing research at the Center, assessing 
economic feasibility, and developing farm management applications. The 
value of the work is evident in the growing number of stakeholders 
which are involved and in the expanded networking with private sector 
organizations.
                   extension specialist, mississippi
       (basic weather service for research and extension project)
    Question. Please provide a description of the program that has been 
funded as the Basic Weather Service for Research and Extension Project.
    Answer. The Basic Weather Service and Extension project is designed 
to fill a void in weather data due to closure of the Ag Weather Service 
facility in Stoneville, Mississippi. The funding will be used to gather 
and disseminate critical agricultural weather data for producers and 
researchers in Mississippi and surrounding states.
    Question. What is the national, regional or local need for this 
program?
    Answer. The grant proposal states that the Ag Weather Service 
facility was closed at Stoneville, Mississippi. This action has created 
a void in the availability of and access to critical weather data that 
producers and researchers use to make management decisions and to 
formulate work plans within the state and region.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The goal of the project is to collect, maintain, and 
disseminate weather information for producers and researchers in 
Mississippi and surrounding states. Electronic weather stations and 
links with other web sites to deliver weather data have been installed 
and developed. The project is providing timely data to producers in the 
Delta.
    Question. How long has the program been underway and how much has 
been appropriated by fiscal year through 1999?
    Answer. The funding for fiscal years 1997 and 1998 was $50,000 each 
year and for 1999 $100,000 was appropriated for a total of $200,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The State of Mississippi, through the Mississippi 
Cooperative Extension Service and Delta Research and Extension Center, 
provided $41,350 in state appropriated funds to support this project in 
1997 and 1998.
    Question. Where is the work being carried out?
    Answer. The project will be conducted at the Delta Research and 
Extension Center in Stoneville, Mississippi.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of the additional or related objectives?
    Answer. One of the original objectives, installation of equipment 
to collect weather data and establishment of a website, has been 
completed. The agriculture community--producers, markets, supplier of 
goods and services, and financial institutions--depend upon weather 
information as a guide for business planning and decision making. The 
National Weather Service has eliminated certain critical services to 
rural areas and to agriculture clientele. As agriculture implements new 
programs in pest management, crop production, and site-specific 
farming, near real-time weather data is critical to success of these 
programs. Weather services provided by the Stoneville project will be 
in cooperation with and complementary to services provided by the 
National Weather Service. Additional objectives relating to the 
continuing need to collect, process, and disseminate timely weather 
data are critical to the Delta Region. Current funding supports the 
objectives to ensure these weather services are available to the 
region.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Evaluation of the project and Internet website is being 
conducted with an on-line survey instrument and through e-mail 
responses about the site. An advisory group has been identified and is 
functioning to provide evaluative feedback on the weather center's 
current status as well as assessing needs for future plans for the 
project's continued mission.
                 income enhancement demonstration, ohio
    Question. Please provide a description of the program that has been 
funded under the Income Enhancement Demonstration Project for Northwest 
Ohio.
    Answer. The Federal funds support the Agricultural Business 
Enhancement Center which plays a major role in the development of the 
agricultural sector of Northwest Ohio. The Center provides a variety of 
management training programs, helps farmers and other agribusinesses 
develop comprehensive business plans, and facilitates business 
networking. CSREES performs an annual merit review of this project.
    Question. What is the national, regional, or local need for this 
program?
    Answer. The Center seeks to enhance the competitiveness for 
agricultural firms in Northwest Ohio and create greater economic 
opportunity for local residents. To be successful in business, farmers 
and other agribusiness firms must be able to adapt to a large number of 
major changes affecting the entire food system from the farmer to the 
consumer. These include changes in farm programs, globalization of 
markets, new technologies, information systems, consumers' concerns for 
food safety and nutrition, and society's concern for protecting the 
environment. Individuals, families, firms, and communities in Northwest 
Ohio need to understand the changes, and develop and implement 
effective strategies for dealing with change.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The original goal of the project was to help people develop 
new businesses and restructure and expand existing businesses in order 
to enhance incomes in Northwest Ohio. The Agricultural Business 
Enhancement Center conducts economic research on market opportunities, 
provides a variety of management training programs, helps individual 
farms and other agribusinesses develop comprehensive business plans, 
and facilitates networking with businesses in other regions of the 
United States and around the world. During 1997, for example, six 
business plans were completed--three firms decided to pursue financing 
and startup, and three firms decided to abandon their idea. Seven 
additional plans were in various stages of development. Out of 150 
women attending ``Women in Agriculture'' workshop, 85 percent said 
workshop participation would improve management of the family farm, 80 
percent said it would improve family relationships, and 22 percent said 
it would improve farm income. The Center completed its tomato 
processing plant feasibility study and accompanying business plan but 
was unsuccessful in finding a sufficient number of producers to invest 
in a cooperative or to find a private investor. A new study is underway 
to determine the feasibility of farmers markets at Ohio Turnpike 
plazas.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. The project began in 1991. Appropriations have been as 
follows:$145,000 in fiscal year 1991; $250,000 per year in fiscal years 
1992 through 1995; and $246,000 per year in fiscal years 1996 through 
1999. Appropriations to date total $2,129,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The State of Ohio has appropriated the following funds: 
$35,100 in fiscal year 1991; $72,368 in 1992; $56,930 in 1993; $30,547 
in 1994; $49,935 in 1995; $51,432 in 1996; $48,664 in 1997; and $53,736 
in 1998.
    Question. Where is the work being carried out?
    Answer. The Agricultural Business Enhancement Center is located in 
Bowling Green, Ohio and serves eight counties in the Toledo 
Metropolitan Area. Project leadership is being provided by the 
Department of Agricultural Economics, Ohio State University, Columbus, 
Ohio.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have these objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1991 was for a period of 12 
months, however, the ongoing needs of producers and agribusinesses to 
adjust to major changes in the agricultural sector continues to provide 
the Center with many challenges. The current phase of the program will 
be completed in September 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. CSREES performed a merit review of the project in March 
1998 as it evaluated the proposal for that year, and concluded that the 
project has a good track record of providing relevant and useful 
management and marketing education to local farmers and agribusinesses. 
However, the project leader was asked to submit plans for evaluating 
the impact of the project before funds would be released. The 
evaluation plan was approved in July 1998 and funds released in August.
                  integrated cow-calf management--iowa
    Question. Please provide a description of the program that has been 
funded as ``CHIPS: Cow-Calf Integrated Resource Management Program.''
    Answer. The CHIPS program is a grass roots, technical assistance 
program designed to provide management assistance services to Iowa cow-
calf producers. This integrated resource management--IRM--program was 
developed to impact the area's rural economy by maximizing the profit 
potential of individual livestock producers. Participating cooperators 
work one-on-one with trained technicians, utilizing a variety of 
management services designed to assist these producers as enterprise 
decisions are finalized. The CHIPS program was originally targeted in 
an 11-county area of southeast Iowa. The program has systematically 
grown to extend services to over 190 beef producers in over 60 Iowa 
counties.
    Question. What is the national, regional or local need for this 
program?
    Answer. The agricultural economy of Iowa has experienced 
significant changes over the past several years. These changes have 
impacted the economic structure and health of local and regional 
agricultural entities. Weather conditions, floods, depressed market 
prices, and industry changes have all contributed to these economic and 
industry changes.
    CHIPS has adjusted program focus and direction to respond to the 
economic conditions existing in the volatile cattle industry. This 
approach provides CHIPS cooperators with individualized alternatives to 
address the situation at hand. Technicians work with cooperators to 
address industry issues, including grain substitution options during 
high corn/soybean prices, management recommendations as the 
Conservation Reserve Program--CRP--acres are released, and updates 
regarding market programs. These examples reflect CHIPS long-term 
sustainable approach as sound management and economic decisions are 
finalized by cooperators. Through the CHIPS program, producers will 
have a performance and economic perspective of their beef operation. 
Decisions made from data collection and management recommendations are 
imperative as producers address these economic challenges. This 
approach supports both individual economic survival as well as 
strengthening the local and regional economic community.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The overall goal of CHIPS is to have a positive effect on 
the area's economy by improving the long-term profit potential of the 
local cattle industry. To address this broad project goal, CHIPS has 
established the following objectives:
  --Improve profit potential of cooperator farms.
  --Identify issues and trends in management data.
  --Raise awareness and understanding of over 2,000 agricultural 
        producers in Iowa about cow-calf production on highly erosive 
        land and integrated resource management.
  --Provide CHIPS cooperators intensive technical assistance to develop 
        goals and individualized farm recommendations, including 
        management areas such as pasture and forage production, 
        rations, utilization of resources, record systems, and 
        government farm program compliance. Over 190 cow-calf 
        operations were involved in this technical assistance program 
        during 1998.
  --Assist producers as they develop management skills to improve 
        efficiency and reduce costs of production as CHIPS 
        recommendations are implemented.
    During 1998, over 190 cooperators, involving approximately 16,000 
beef cows, participated in CHIPS. This program has expanded in 
cooperator numbers and geographical area. CHIPS has grown from one 
technician and 11 counties in 1992 to seven FTE technicians servicing 
60 counties in Iowa. The infrastructure has also changed. This 
expansion includes formation of CHIPS, Inc., a CHIPS Employee Handbook, 
administrative interaction with Iowa State University, Pathfinders 
RC&D, and Southern Iowa RC&D.
    During 1997-98, CHIPS technicians conducted 1,189 one-on-one farm 
consultations. Numerous management areas were reviewed, with over 9,900 
calves weighed, 3,500 beef cows weighed, and more than 4,100 head 
permanently identified. This information was utilized by the 
technicians to complete and analyze 69 Cow Herd Appraisal of 
Performance Software--CHAPS--and 19 Standardized Performance Analysis--
SPA--records. These contacts involve a wide variety of technical 
assistance, with primary emphasis on nutrition, cost-effective ration 
development, genetic evaluation, value-added practices, and cow 
production concerns. Included were more than 300 forage samples, with 
over 250 specific rations and projections distributed. Over 77 pasture 
consultations were conducted, 8 newsletters distributed to over 1,300 
agribusiness producers and representatives, and 44 soil samples 
collected. An educational Beef Value Added Tour to Kansas was 
coordinated by CHIPS, with 54 people attending the two-day event. Over 
650 people participated in 44 educational programs and presentations 
involving CHIPS technicians and support staff.
    Question. How long has the program been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. $138,000 was approved for fiscal year 1992; $138,000 for 
fiscal year 1993; $276,000 for fiscal year 1994; $350,000 for fiscal 
year 1995; $345,000 for fiscal year 1996; $345,000 for fiscal year 
1997; and $300,000 per year in fiscal years 1998 and 1999. Federal 
funding through fiscal year 1999 totals $2,192,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. CHIPS cooperators pay client fees of approximately $3.00 
per cow. This fee structure is on a sliding scale that adjusts for cow 
herd size. Approximately $45,000 client fees were collected from 
cooperators during fiscal year 1998.
    Question. Where is the work being carried out?
    Answer. The CHIPS program is being operated in six designated 
technician areas in Iowa. These include approximately 60 counties in 
the following Iowa areas: southeast--16 counties; south central--8 
counties; southwest--8 counties; northwest--8 counties; east central--8 
counties; and central--12 counties.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The CHIPS program was initially projected to address the 
goals and objectives of the project in a three-year time frame. As the 
program expanded, new services were extended to new geographical areas. 
As this expansion progressed, CHIPS adjusted the focus and direction of 
services to meet the rapidly changing needs of the cattle industry. The 
level of technical assistance and program delivery will require 
continued adaptation to emerging issues. Over the past several years, 
producers have been challenged by low forage quality and quantity due 
to excessive moisture and flooding, record high grain prices, closure 
of the Monfort beef packing plant in Des Moines, and depressed prices. 
As this occurred, CHIPS responded by adapting services and technical 
assistance to cooperators.
    The objectives and goals of CHIPS will continue to be modified and 
adapted to meet needs of the cooperators. CHIPS is developing an 
agreement with the Iowa Cattlemen's Association--ICA. The goal is to 
expand services to CHIPS clientele and support the value added Iowa 
Quality Beef program. This relationship is the direct result of 
discussions with the ICA, the Iowa Beef Center at Iowa State 
University, Precision Beef Alliance, and CHIPS. Cooperating beef groups 
will determine the services and administrative structure of CHIPS in 
the future.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A CSREES review of this project is conducted annually. In 
addition, three Iowa State University Extension personnel have been 
requested to conduct a CHIPS program evaluation. Included in this 
request is a review of CHAPS and SPA records to evaluate short-and 
long-term impacts, identification of production and management changes 
incorporated by cooperators due to CHIPS, and future services needed by 
clientele. This information will be essential to determine the 
financial and production impact of the program, and to determine what 
services and technical assistance should be supported. Preliminary 
information from the record evaluation indicates changes in production 
have had a positive impact on the operations involved in the CHIPS 
program. This evaluation process is to be completed by June, 1999.
           national education center for agricultural safety
    Question. Please provide a description of the extension project 
that has been funded under the National Education Center for 
Agricultural Safety grant.
    Answer. The National Education Center for Agricultural Safety is 
dedicated to reducing the level of preventable illnesses, injuries, and 
fatalities among farmers, ranchers, their families, and employees. The 
National Education Center for Agricultural Safety translates current 
research into training programs on the safety and health hazards that 
impact the agricultural workplace. Training methods include the use of 
real-life scenarios and simulations for the purpose of enhancing 
trainee knowledge and positively changing work behaviors so that unsafe 
work practices can be reduced and eliminated among the at-risk 
audiences. An 11,000 square foot training center developed with a 
$1,000,000 grant from Iowa houses the resources and simulators used in 
the hands-on training.
    Question. According to the extension proposal, or the project 
director, what is the national, regional or local need for this 
project?
    Answer. The project director believes this training to be of 
national, regional, and local need. Farming continues to be one of the 
most dangerous occupations in the United States. 1998 data provided by 
the National Safety Council showed that 830 farmers, ranchers, family 
members, and farm employees suffered fatal injuries while performing 
farm work. Most of these incidents were classified as preventable. The 
adoption of safe work habits is dependent upon the relevance, 
affordability and availability of safety training for at-risk and 
underserved agricultural audiences. It is the mission of the National 
Education Center for Agricultural Safety to make practical, hands-on 
training available in order to reduce the level of preventable 
illnesses, injuries, and fatalities in production agriculture.
    Question. What was the original goal of this training center and 
what has been accomplished to date?
    Answer. The original, and continuing goal of this project was to 
test the efficacy of adapting practical, hands-on training methods for 
reducing the level of preventable farm work incidents in the United 
States. Research indicates that trainees and students will positively 
respond to agricultural safety training if it simulates real life 
conditions of farming hazards. The National Education Center for 
Agricultural Safety is offering practical training initiatives 
concentrating on the hazards that negatively impact farm work, 
including hazards associated with the farm machinery, agrichemicals, 
livestock, confined spaces, and grain.
    During fiscal year 1998, over 400 individuals received training 
coordinated by National Education Center for Agricultural Safety. Among 
these trainees were emergency medical service personnel, farm 
cooperative patrons, agricultural youth, and high school agriculture 
teachers. Mail and phone follow-ups with many of these trainees have 
shown that most are sharing critical safety and health information with 
their peers, parents, and other at-risk audiences. For example, one 
Montana family trained during the National Education Center for 
Agricultural Safety AG Families--USA program, have conducted seven 
community-based programs for adults and children in Western Montana. 
Another dairy farm family from the Milwaukee, Wisconsin, area, planned 
and conducted a comprehensive farm safety day camp for over 100 farm 
youth in eastern Wisconsin.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal years through fiscal year 1999?
    Answer. The work supported by this grant began in fiscal year 1998, 
and the appropriation for fiscal years 1998 and 1999 is $195,000 per 
year for a total of $390,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. The non-federal funds and sources provided for this grant 
were as follows: $450,000 state appropriations dedicated for 
construction of the Phase II training sites at the National Education 
Center for Agricultural Safety, and $75,000 miscellaneous cash and in-
kind donations during fiscal year 1998. Non-federal funds were provided 
by Deere & Company, DuPont Corp., Double L Group, Ltd., Melroe Company, 
Dubuque Racing Association, and the Theisens' Farm, Home and Auto 
Company.
    Question. Where is this work being carried out?
    Answer. Training under this grant will be conducted at the National 
Education Center for Agricultural Safety, located on the campus of 
Northeast Iowa Community College in Peosta, Iowa.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The anticipated completion date of the original objectives 
is approximately March 31, 1999. Many of these objectives have already 
been met. Anticipated completion date of additional objectives is March 
31, 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. A CSREES merit review of the project application was 
conducted in the spring of 1998. The project will be completing its 
first year March 31, 1999. The National Education Center for 
Agricultural Safety will utilize multiple evaluation tools such as pre 
and post testing, follow-up surveys to determine knowledge gain and 
behavior change, external evaluators, and an advisory committee.
                  pilot technology project, wisconsin
    Question. Please provide a description of the program that has been 
funded under the Wisconsin Pilot Technology Project.
    Answer. Primary industrial extension activity of the Manufacturing 
Technology Transfer program is the delivery of technical assistance to 
manufacturing companies. Executive direction in determining the 
assistance required will be provided by the University of Wisconsin--
Stout's Northwest Wisconsin Manufacturing Outreach Center--NWMOC--with 
direct consultation and long-term in-plant assistance delivered 
primarily through the efforts of university Project Managers and Co-op 
students. Direct assistance may be delivered through staff of the 
University of Wisconsin System, both two-and four-year institutions, 
and Extension services; the Wisconsin Technical college System; 
secondary schools; the private sector, professional societies, and 
private consultants, or attendance at state or national seminars. The 
project also draws on many other state resources to add expertise and 
capacity to network facilitation and in-plant extension activities. The 
project has undergone a merit review.
    Question. What is the national, regional, or local need for this 
program?
    Answer. America's manufacturers continue to face tremendous global 
competition. There are enormous pressures to improve the quality of 
products; reduce the time consumed to bring new products to market; and 
there remains an ever increasing demand to reduce the costs of 
products. Currently there is a strong movement in manufacturing to use 
speed-to-market combined with new product introduction as a tool to 
obtain a competitive advantage. While high quality and cost 
efficiencies continue to be mandatory commitments for today's 
manufacturers, great value is now being placed on speed-to-market. 
Large companies are not the only ones influenced by these trends. 
Small-and medium-size manufacturers often supply larger firms. Hence, 
they must be able to quickly process large amounts of information and 
solve complex problems.
    Question. What is the original goal of this program and what has 
been accomplished to date?
    Answer. The Manufacturing Technology Transfer program's principal 
objective is the development of a competitive, secure manufacturing 
base through the mechanism of industrial extension. The program 
principally targets small and medium-size manufacturers in rural 
Wisconsin. This funding will: continue to provide valuable industrial 
extension service to the target audience; support the continued 
empirical development of an industrial extension model; and investigate 
the use of new manufacturing technologies to support global 
competitiveness of manufacturers. Productivity improvements were 
reported by the companies showing impressive economic impact to the 
region through implementation of:
  --Client operations assessment/plant evaluation and strategy 
        development
  --Opportunities for productivity improvements.
  --Implement new organizational and operational methods
  --Investigate new manufacturing technologies.
  --Establish quality assurance/total quality systems.
  --Establish ongoing training programs.
  --Deliver on-site instruction in new technologies, improved methods 
        and processes.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. This project has been underway since fiscal year 1992 and 
was funded for $165,000 per year in fiscal years 1992 through 1995, and 
for $163,000 in fiscal years 1996 through 1999 for a total of 
$1,312,000.
    Question. What is the source of and amount of non-federal funds 
provided by fiscal year?
    Answer. No non-federal funds have been provided for this project.
    Question. Where is this work being carried out?
    Answer. The work will be carried out by the University of 
Wisconsin-Stout.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1992 was for a period of 12 
months. However, the Manufacturing Technology Transfer Program was 
developed as a continuously evolving industrial extension strategy for 
serving the needs of the manufacturing community. The Manufacturing 
Technology Transfer Program is measured by success in meeting the 
objectives of the past five years' proposals, including the delivery of 
modernization assistance and development of an industrial extension 
model. The current phase of the program will be completed in 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. To measure the success of the project, a client evaluation 
process has been developed which includes an evaluation questionnaire. 
Evaluations indicate significant forward strides in job creation, new 
businesses, expanded productivity, and enhanced international 
competitiveness. An agency evaluation of this project was last 
performed by the Department of Commerce in 1997.
                  range policy development, new mexico
    Question. Please provide a description of the program that has been 
funded under the Range Policy Development research grant.
    Answer. The Range Policy Development project has collected local 
economic data throughout the State. Local data have been used to 
develop an economic model to help explain the relationships among local 
economies and primary industries. The model is intended to enable 
policymakers to better understand how local and State economies are 
tied to primary industries, especially those industries that use public 
lands. The initial focus of the project has been on the livestock 
grazing industry. The project has undergone merit review within CSREES, 
and funds have been awarded to the institution following 
recommendations by the review panel.
    Question. What is the local, regional, or national need for this 
program?
    Answer. In New Mexico and throughout the western states, many local 
economies are dependent on the use and management of public range and 
forest lands. However, there exists a great deal of disagreement about 
the true level of dependence of individual communities on these public 
land-based industries, and, consequently, disagreement about the local, 
statewide, and regional impacts of public policies that alter the use 
and management of these lands. Through better understanding of how 
public lands impact local and regional economies, we may be better able 
to predict the outcomes of potential legislation or amended land use 
policies, resulting in policies that enhance, rather that detract from, 
local economies.
    Early results from this project have been encouraging and have 
spawned a six-state collaboration to design a regional economic model 
based on the New Mexico prototype. This regional coalition has been 
seeking funds from multiple sources, including the Fund for Rural 
America.
    Question. What is the goal of this program and what has been 
accomplished to date?
    Answer. New Mexico is in the process of developing detailed input-
output models for each county from local and state tax revenue data. 
The economists are following up with workshops across the state to 
present information from economic forecasts to local decisionmakers. 
Further, the project calls for increasing the utility of the models by 
expanding the scope of the database to include industries in addition 
to the grazing enterprises.
    Question. How long has this work been under way and how much has 
been appropriated through fiscal year 1999?
    Answer. This project was initiated in December 1994. It has been 
funded year-to-year to accomplish annual objectives. The first tier of 
objectives were met in 2 years. The second phase is currently scheduled 
for completion during 1999. The total appropriation for the project has 
been $964,240. Of that total, $197,000 appropriated for fiscal year 
1998 has been extended through November 1999. The 1999 appropriation of 
$197,000 has yet to be awarded, as we have yet to receive and review a 
request from the institution.
    Question. What is the source and amount of non-federal funds to 
support this project?
    Answer. The project budget does not indicate any non-federal 
support. However, Agricultural Research Stations in five other States 
have economists currently working together on a Regional Research 
Project, with the intent of improving and expanding upon the New Mexico 
project.
    Question. Where is this work being carried out?
    Answer. Research is being conducted statewide based from New Mexico 
State University in Las Cruces, New Mexico.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. According to the project director, most of the original 
objectives have been accomplished. In this second phase of the project, 
the investigators are collecting data to allow incorporation of other 
industry and government sectors into the model. Objectives for this 
phase should be completed near the end of 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The proposal for continued funding most recently underwent 
merit review by a team of CSREES National Program Staff in May 1998, 
and a review of progress-to-date was conducted by the project liaison 
in September 1997. The reviews focused on criteria including the 
relevance of the project goals, the suitability of the proposed 
research methods, and the extent of progress made toward addressing the 
goals of the project. Both reviews found that phase one objectives had 
been met and that adequate progress had been made toward the objectives 
of the second phase of the project. A more comprehensive evaluation of 
the project, originally scheduled for Fall 1998, has been rescheduled 
for December 1999 to coincide with the no-cost extension requested by 
the project managers at New Mexico State.
                      rural development, oklahoma
    Question. Please provide a description of the program that has been 
funded under the Rural Development, Oklahoma Project.
    Answer. This program provides financial and technical assistance to 
small business to create and retain jobs in rural Oklahoma and to 
stimulate the local economies. The program is carried out through 
financial services, business incubators, problem-solving assistance to 
small-and medium-sized manufacturers, and technical assistance to rural 
small businesses. The program is expanding to include assistance to 
rural small businesses to enter international trade. The program 
continues to evaluate new products and processes that may result in new 
industries or be applied to improve existing manufacturing processes. 
The project has undergone a merit review.
    Question. What is the national, regional, or local need for this 
program?
    Answer. The increased demand for small business financing and 
technical assistance verifies the need for the program. Each year 
financing secured for small businesses has significantly increased. The 
demand for business incubators is also on the rise. Last year, Rural 
Enterprises--REI--agreed to mange two more business incubators bringing 
the total REI-managed facilities to thirteen. Also, small businesses 
continue to need access to technical and business management 
assistance, worker training, and international trade assistance in 
order to stay competitive in domestic and world markets.
    Question. What was the original goal of this program and what has 
been accomplished?
    Answer. The original goal of the program was to create jobs in 
rural Oklahoma by providing systematic access to improved technology, 
training, financial, and business management assistance. REI is a 
Certified Development Corporation for the small Business Administration 
as well as a designated Certified Development Financial Institution. As 
a result, REI has been successful in obtaining financing for 
entrepreneurs and rural small businesses totaling $119,060,129. Special 
technical assistance efforts have included problem-solving assistance 
to small manufacturers; training and dissemination of information on 
ISO9000 to assist rural businesses compete with a global market; 
providing manufacturers with a ``Quick View Assessment'' program which 
enables manufacturers to compare their facilities and operations with 
other companies across the United States; and working one-on-one with 
small businesses providing on-site assistance with inventory control, 
cash flow management, and marketing.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Appropriations to date are as follows: $433,000 per year in 
fiscal years 1988-89; $430,000 in fiscal year 1990; $431,000 in fiscal 
year 1991, $300,000 per year in fiscal years 1992-95; $296,000 per year 
in fiscal years 1996-97; $150,000 per year in fiscal years 1998-1999. 
Appropriations total $3,819,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. No non-federal funds have been provided for this project.
    Question. Where is this work being carried out?
    Answer. The work is being carried out at Rural Enterprises, Inc., 
REI, in Durant, Oklahoma.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1988 was for a period of 12 
months. However, the objectives of Rural Enterprises, Inc. are on-going 
because of the nature of the activity. The clientele is diverse and 
decentralized. The engineering and management consultation model being 
pursued with individual clients results in a situation where hundreds 
of problems are being pursued simultaneously and when solved are 
replaced by new issues resulting from international competition, 
regulations, training needs, and changeover costs. The next phase of 
the program will be completed in 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. REI itself conducts an on-going evaluation process to 
measure the organization's effectiveness and efficiency in 
accomplishing its objectives, and this is documented on a quarterly 
basis through our reporting system. Over 6,000 jobs have been created 
and retained for new and expanding businesses as a result of this 
program. While the program has met its key objective of job creation in 
rural Oklahoma, the nature of its outreach effort continues to evolve 
and change as business sustainability and profitably confront new 
challenges within small and rural communities. CSREES has not conducted 
an evaluation of the Rural Enterprises, Inc. project.
             rural development through tourism, new mexico
    Question. Please provide a description of the program that has been 
funded under the Rural Economic Development Through Tourism--REDTT--
Project in New Mexico.
    Answer. The Rural Economic Development Through Tourism Project 
involves applied research and outreach focused on locally-based tourism 
development strategies to enhance economic opportunity in small and 
rural communities in New Mexico. Components of the agenda support 
training of local leadership and tourism professionals, strategic 
planning and market development, and technical assistance to 
communities. The proposals submitted are submitted for internal review 
and evaluation within the agency. Recommendations are presented to 
enhance impact on regional and national agendas.
    Question. What is the national, regional or local need for this 
program?
    Answer. This is an on-going pilot to demonstrate the effective 
development and implementation of applied research, training, 
education, and technical assistance related to rural tourism as a 
development strategy. The grant has demonstrated that a long-term 
commitment of resources and activity can lead to effective development 
of tourism resources and build new market opportunities and tourism 
products for small communities. This project would provide an excellent 
proposal for the Fund for Rural America.
    Question. What was the original goal of this program and what has 
been accomplished?
    Answer. The applied research and outreach project was designed by 
the State Cooperative Extension Organization to increase the ability of 
the public sector to enhance economic opportunity for rural communities 
through tourism development. A regional task force composed of 
Extension professionals and community leaders from business, industry, 
education, and government--local, state, and Federal--was developed to 
guide and advise the development and implementation of locally-based 
programming and research. The results include video training materials, 
a public relations package, image studies and profiles, regional 
tourism guides, development of tourism bus packages, festival planning 
workshops, development of regional tours, and a mini-grants program for 
tourism development.
    Question. How long has this work been underway and how much has 
been appropriated through fiscal year 1999?
    Answer. In fiscal years 1992 through 1995 the amount of $230,000 
was appropriated. The appropriation for fiscal years 1996 and 1977 was 
$227,000 per year; for fiscal year 1998 was $247,000; and for fiscal 
year 1999 was $280,000. Total appropriated funds to date is $1,901,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. fiscal year 1992 included $38,764 in state matching funds. 
fiscal years 1993,1994, 1995, and 1996 included $39,360 of state 
matching funds. fiscal years 1997 and 1998 include $39,040 state 
matching funds.
    Question. Where is this work being carried out?
    Answer. Applied research and outreach is being carried out through 
New Mexico State University.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original completion date was September 30, 1993. The 
original objectives of this research have been met. The additional 
objectives being presented for the current year will be completed by 
September 30, 2000.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency evaluates the merit of research proposals as 
they are submitted. No formal evaluation of this project has been 
conducted. The principal investigators and project managers submit 
annual reports to the agency to document impact of the project. Each 
year, the project has demonstrated significant accomplishment in the 
reports submitted. Impacts include significant increases in attendance 
of local festivals, increase in number of tour bus visits to New 
Mexico, training to over 700 tourism employees in the region, and 
establishment of a number of new businesses. Agency evaluation of the 
project includes peer review of accomplishments and proposal objectives 
and targeted outcomes.
                     rural rehabilitation, georgia
    Question. Please provide a description of the program that has been 
funded under the Rural Rehabilitation project in Georgia.
    Answer. The program has tested the feasibility of providing 
satellite-based adult literacy education, in association with 
vocational rehabilitation services, to handicapped adults in rural 
Georgia. The program has developed curriculum, tested and adapted 
technology, established student recruitment and retention strategies, 
expanded to Statewide coverage, and provided successful adult literacy 
education.
    Question. What is the national, regional, or local need for this 
program?
    Answer. A state task force has estimated that 25 percent of 
Georgia's adult population is functionally illiterate. Functional 
illiteracy is regarded in Georgia as a form of disability. The extent 
of adult functional illiteracy is similar throughout much of rural 
America.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The original goal of this program was to prove that 
distance learning can be an effective tool for reaching and teaching 
functionally illiterate adults in rural areas. This program has 
demonstrated that satellite-based literacy training, in cooperation 
with vocational rehabilitation services, can successfully provide adult 
literacy education designed to improve critical reading, writing, and 
thinking skills, for handicapped rural adults. Over the past 9 years, 
test scores and attendance and completion rates of students in the 
satellite-based program have shown that distance learning is an 
effective delivery system for instructing low-level readers and non-
readers. Test scores and attendance rates of students in this program 
have been comparable to those of students in traditional, urban 
classes.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Funding for this program was initially appropriated in 
fiscal year 1989, and the program has been in operation since March 
1989. Through fiscal year 1998, appropriations for this program have 
been as follows: $129,000 in fiscal year 1989; $256,000 per year in 
fiscal years 1990, 1991, and 1992; $250,000 per year in fiscal years 
1993, 1994, and 1995; and $246,000 per year in fiscal years 1996, 1997, 
1998 and 1999. Funds appropriated to date total $2,631,000. These 
Federal funds are typically used for program innovation and quality 
improvement.
    Question. What is the source of and amount of non-federal funds 
provided by fiscal year?
    Answer. The fiscal year 1998 source of non-federal funds provided 
for this program are state appropriated funds from the Georgia 
Department of Adult Education. Prior years sources also included 
private contributions from the Woodruff Foundation and other local 
foundations. Through fiscal year 1998, the total amount of non-federal 
funds provided the project has been $8,006,901. The breakdown by fiscal 
year is: $164,000 in fiscal year 1988; $270,500 in fiscal year 1989; 
$809,675 in fiscal year 1990; $656,765 in fiscal year 1991; $65,000 in 
fiscal year 1992; $1,019,821 in fiscal year 1993; $20,000 in fiscal 
year 1994; $872,500 in fiscal year 1995; $1,500,000 in fiscal year 
1996; $1,319,320 in fiscal year 1997; and $1,309,320 in fiscal year 
1998.
    Question. Where is this work being carried out?
    Answer. The Georgia Tech Satellite Literacy Project is sponsored 
and operated by four organizations: Georgia Institute of Technology's 
Center for Rehabilitation Technology, the Center for Rehabilitation 
Technology, Inc., Literacy Action, Inc., and the Georgia Department of 
Technical and Adult Education. The program grantee is CRT, Inc., a 
private, not-for-profit business advisory board to the Center for 
Rehabilitation Technology, College of Architecture, Georgia Institute 
of Technology, from which the literacy instruction has been provided.
    Question. What was the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. It was anticipated that it would take three years to 
demonstrate that distance learning can be an effective tool for 
reaching and teaching functionally illiterate adults in rural areas. 
That original objective was met in Fiscal 1991. Additional objectives 
since fiscal year 1991 have been to expand the outreach of the 
satellite based adult literacy program to enough additional sites 
throughout the State of Georgia so that all potential participants have 
reasonable access to the program, and to continually upgrade the 
quality of class programming and the technical capacities of the 
system. The fiscal year 1997 technological upgrades expanded the 
capacity of the program more than 25-fold, from 77 to over 2,000 
downlink sites, and a 6-fold increase in broadcast hours, and made 
materials available as supplemental tools to all Georgia literacy 
classes. As of December 1997, the Georgia Tech Satellite Literacy 
Program is in a period of transition from that of providing literacy 
instruction via direct television broadcasts to classrooms to that of 
development and dissemination of technology-based instructional aids. 
The project has been renamed the Lifelong Learning Network, or LNN. 
This change is being made based upon the request of the major sponsor, 
the Georgia Department of Technical and Adult Education, Office of 
Adult Literacy. The LNN will develop and produce video-based 
instructional supplements, technology-based curriculum and training for 
adult literacy practitioners, and multi-media projects for literacy 
students.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. The agency receives annual reports on the project that are 
used, together with agency merit review, to assess its progress. Based 
on these reports, the agency has found that the project has made steady 
progress in demonstrating the feasibility of utilizing distance 
learning technology and teaching methods to provide adult literacy 
education programs to handicapped adults throughout the State of 
Georgia. The project has been successful in applying the latest 
distance education technology to both control the program cost per 
participant and, most recently, to expand the availability of the 
program.
         technology transfer projects, oklahoma and mississippi
    Question. Please provide a description of the program that has been 
funded under the Oklahoma and Mississippi Technology Transfer Projects.
    Answer. The original work involved the transfer of uncommercialized 
technologies from Federal laboratories and universities to rural 
businesses and communities. The objectives have evolved to providing 
more one-on-one assistance to small manufacturers. This type of 
assistance responds to the stated needs of the small manufacturing 
community and fills a recognized gap in the existing service provider 
community. This project has undergone a merit review.
    Question. What is the national, regional, or local need for this 
program?
    Answer. Manufacturing extension programs throughout the country 
have identified one-on-one engineering technology assistance as a need 
for small manufacturers as they attempt to become more competitive and 
profitable.
    Question. What is the original goal of this program and what has 
been accomplished to date?
    Answer. The primary goal of these programs is to contribute to an 
increase in business productivity, employment opportunities, and per 
capita income by utilizing technology and information from Federal 
laboratories; Rural Enterprises Development Corporation and Industrial 
Technology Research and Development Center in Durant, Oklahoma; 
Mississippi State Food and Fiber Center; Vocational-Technical Education 
System; Center for Local Government Technology; Cooperative Extension 
Service; and other university departments and non-campus agencies. 
Specific program objectives are to:
  --Develop greater profitability of existing enterprises.
  --Aid in the acquisition, creation, or expansion of business and 
        industry in the area.
  --Establish an effective response process for technological and 
        industrial-related inquires.
  --Devise effective communication procedures regarding the program for 
        the relevant audiences.
    Question. How long has this work been underway and how much has 
been appropriated by fiscal year through fiscal year 1999?
    Answer. Funding appropriated to date is as follows: $350,000 per 
year in fiscal years 1984 and 1985; $335,000 in fiscal year 1986; 
$333,000 per year in fiscal years 1987 through 1990; $331,000 per year 
in fiscal years 1991 through 1995; and $326,000 per year in fiscal 
years 1996 through 1999. Appropriations to date total $5,326,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Oklahoma State University and Mississippi State University 
have provided considerable amounts of matching support from state funds 
over the life of the project. Over the past four years, support has 
included a significant portion of engineering faculty salaries as well 
as the administrative support of county and district extension staff.
    Question. Where is this work being carried out?
    Answer. The work is being carried out at Mississippi State 
University and Oklahoma Sate University.
    Question. What is the anticipated completion date for the original 
objectives of the project? Have those objectives been met? What is the 
anticipated completion date of additional or related objectives?
    Answer. The original proposal in 1984 was for 12 months. The 
original objectives have been, and continue to be met. Although 
individual client projects have a beginning and end, the technology 
transfer process is continuous. Over the past years, specific and 
measurable annual objectives and the achievement of objectives have 
been documented in annual reports. The objectives of both programs have 
been to: continue the delivery of high-quality engineering assistance 
and technology transfer services to small manufactures: conduct joint 
workshops, client referral, and joint research and application 
projects; and demonstrate a value of service to clients many times 
project operating costs. The current phase of the program will be 
completed in 1999.
    Question. When was the last agency evaluation of this project? 
Provide a summary of the last evaluation conducted.
    Answer. Site visits and merit reviews have been conducted annually 
on these projects as well as client surveys by project staff 
themselves. Survey results have documented job creation, productivity 
enhancement, and local community economic activity. The Technology 
Transfer program has impacted the integration of emerging technologies 
that are benefitting the citizens, ranging from assisting small 
businesses and industries in integrating new computer hardware and 
software for conducting electronic commerce, to providing extensive 
online information resources. The Technology Transfer Funds have served 
as a catalyst for the development of a long range telecommunications 
network plan for the total extension service to link all county 
extension offices and research centers directly to the Mississippi 
data/video backbone and provide access to the Internet.
                         wood biomass, new york
    Question. Please provide a description of the program that has been 
funded under the Wood Biomass Grant?
    Answer. The objective of this project is to expand, implement, and 
gain acceptance of wood biomass as a sustainable, renewable and 
environmentally-affable fuel source. In addition, the project is deemed 
to support the promotion of alternative forest products for the 
Nation's Central and Northern Hardwood forests regions.
    Question. What is the national, regional, or local need for this 
program?
    Answer. The principal researchers hypothesize that the project is 
of national interest. Biomass research studies through the U.S. 
Departments of Agriculture and Energy span 20 or more years. This work 
clearly demonstrates that the nation is in a position to scientifically 
produce environmentally-affable fuels for power generation systems. 
Except for co-generation plants the current cost of conventional power 
supply fuels currently precludes the wholesale adoption of this 
technology. Complementing the planned fuel supply are many sidebar 
benefits including carbon sequestration, rural economic development, 
wildlife habitat, and soil erosion and sedimentation associated with 
conventional agriculture.
    Question. What was the original goal of this program and what has 
been accomplished to date?
    Answer. The goal of this project is to promote, through applied 
research and technology transfer, wood biomass as a sustainable wood 
supply for (1) power generation, (2) alternative farm products, (3) 
wise stewardship of land resources, and (4) enhanced farm 
profitability.
    To accommodate these goals, scientists at the State University of 
New York are planting willow trials on several sites and under several 
conditions. Site preparation and planting has occurred on several 
locations, and more are planned. Cornell University, a partner 
institution in the project, has hired a technology transfer specialist 
to coordinate educational activities resulting from this work. Common 
events include field days, news articles, videos, and exhibits.
    Question. How long has the work been underway and how much has been 
appropriated by fiscal year through fiscal year 1999?
    Answer. This aspect of the program began with an appropriation of 
$200,000 in fiscal year 1995. An additional $197,000 was appropriated 
by the Congress for fiscal years 1996 through 1999. This sums $988,000.
    Question. What is the source and amount of non-federal funds 
provided by fiscal year?
    Answer. Four state partners and approximately 18 private partners 
contribute resources at a ratio of nearly 1.5 to 1 for this project.
    Question. Where is the work being carried out?
    Answer. The field work is being conducted on private and state land 
near Syracuse, New York. Electronic and print media allows Cornell's 
technology transfer activities to extend far beyond that point.
    Question. What was the anticipated completion date for the original 
objectives of the project. Have those objectives been met? What is the 
completion date of additional or related objectives?
    Answer. The completion date for the original objectives of the 
project, willow cultivar planting, was September 30, 1996. With the 
addition of some new dimensions to the project, the completion date is 
now 2003. Because of the timing of one of the fiscal awards, some 
weather related problems and some land contract problems all of the 
original objectives have not been met. Most of the unmet objectives 
should be completed in 2000.
    Question. When was the last agency evaluation of the project? 
Provide a summary of the last evaluation conducted.
    Answer. A field review of the project was conducted on August 20-
21, 1997. Excerpts from the review report include (1) positive 
accolades for their quarterly progress reports, (2) positive accolades 
for the outreach program being conducted by Cornell University, (3) 
praise for the scientific outreach by the principal investigators, (4) 
praise for connecting the willow biomass program to the poultry waste 
and riparian issues in New York state, and (5) praise for gaining the 
acceptance of willow biomass as an agricultural crop for state property 
tax purposes. On the concern side, CSREES' project administrator 
flagged the delay in establishing the demonstration farm and requested 
diligence in bringing this aspect of the project to fruition. 
Subsequent reports from the project reveal that this aspect has been 
satisfactorily addressed.
                                 ______
                                 

     SUBMITTED QUESTIONS ON GOVERNMENT PERFORMANCE AND RESULTS ACT

                 Questions Submitted by Senator Cochran
  Alternative Agricultural Research and Commercialization Corporation
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. In accordance with the Act, AARCC has developed a strategic 
plan and annual performance plans for fiscal year 1999 and fiscal year 
2000.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The performance goals and objectives contained in AARCC's 
strategic and annual performance plans were taken from AARCC's business 
plan, which, together with the by-laws, is the operational framework 
for the corporation. The business plan was approved by the AARCC board 
of directors and is the basis by which the board measures the 
performance of the corporation. As the Executive Director, I am 
evaluated, in part, on my ability to have the corporation meet its 
annual and strategic goals.
    Question. How is performance information being used to manage the 
agency?
    Answer. Performance against AARCC's business plan targets is a 
major consideration in establishing a value for AARCC's portfolio and 
preparing the corporation for privatization. Since the business plan 
also anticipates a certain level of repayments to the revolving fund 
each year, performance information is also used to anticipate the 
necessary level of future appropriations. AARCC's budget requests are 
developed accordingly.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. AARCC developed its fiscal year 2000 budget request with 
the expectation that two to three of its portfolio companies would 
complete initial public offerings (IPOs) during the fiscal year. If 
these companies complete successful IPOs and become publicly traded, 
then their capacity for job creation and growth increases. Returns to 
the AARCC revolving fund are also realized through the sale of AARCC's 
stock in the company. This contributes to the attainment of all four 
objectives in AARCC's annual performance plan: increased economic 
development and job creation in rural areas, profitable and efficient 
uses of limited natural resources, development of profitable U.S. 
companies that manufacture products from renewable agricultural, 
forestry, and or animal-based raw materials, and a reduced need for 
appropriated funding for AARCC.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. AARCC has not found it necessary to significantly alter its 
program in order to accomplish its GPRA goals and objectives. The GPRA 
goals and objectives are already expressed as short- and long-term 
milestones in the AARCC business plan. In some instances, timetables 
for accomplishing these milestones have been extended due to unusual 
budget constraints during fiscal year 1999. Nevertheless, AARCC has 
still been able to pursue a number of initiatives to support the 
accomplishment of its performance targets.
    With respect to its performance goal to increase public awareness 
of AARCC and its mission, AARCC has recently introduced of the 
Industrial Agriculture Clearinghouse, an internet-based service 
designed to assist in commercializing new uses for agricultural 
products. To date, the Clearinghouse has been visited 3,864 times; 
AARCC's fiscal year 1999 performance indicator was 2,800 hits.
    Additionally, AARCC has been instrumental in organizing USDA's Bio-
based Products Coordination Council. A primary responsibility of the 
Council is the semi-annual publication in the Federal Register of a 
bio-based products list. This list provides Federal agencies with a 
variety of product alternatives that comply with the environmentally 
preferable purchasing requirements of Executive Order 13101, Greening 
the Government Through Recycling, Waste Prevention, and Federal 
Acquisition. This Executive Order, signed on September 14, 1998, 
strengthens and expands the Federal government's commitment to 
recycling and buying recycled-content and environmentally preferable 
products.
    Finally, in an effort to increase awareness of AARCC and bio-based 
products within the investment community, AARCC co-sponsored an 
investment forum last October and is co-sponsoring another one in June. 
These events are targeted to investors with an interest in 
environmental technologies. They have been organized to showcase 
products and technologies from the bio-based products industry 
generally, and AARCC-funded companies specifically.
    Another performance goal is to obtain a clean and timely audit 
opinion on AARCC's audited financial statements. To this end, AARCC is 
working with an outside contractor and USDA's Office of Inspector 
General (OIG) to develop a new system of internal controls. These 
controls are still being developed and will be implemented later this 
fiscal year. Consequently, AARCC's performance goal of obtaining a 
clean audit opinion in fiscal year 1999 has been delayed until fiscal 
year 2000.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. AARCC's budget structure is dictated by statute--16 percent 
of amounts in the revolving fund (appropriated funds plus return on 
investment) are reserved for administrative expenses; 84 percent must 
be used to fund new projects. The administrative portion of the budget 
supports the salaries, benefits, travel and related expenses of the 
AARCC staff and board of directors. This part of the budget also funds 
the public education, information technology, and financial management 
activities included as management initiatives in AARCC's annual 
performance plan. It is by financing new investments, the activity 
funded by 84 percent of AARCC's overall budget, that AARCC attempts to 
accomplish the performance goals identified in its annual performance 
plan.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. Currently, the Federal Agriculture Improvement and Reform 
(FAIR) Act requires that a full one percent of AARCC's annual 
appropriation be spent to conduct due diligence reviews of prospective 
investment projects. Because the size of AARCC's portfolio has grown 
considerably since this legislation was enacted, the funds sequestered 
by this provision would be better spent to enhance the performance of 
the existing portfolio investments. This could be accomplished by 
redirecting the one percent to be used for follow-on investments in 
existing portfolio companies, or for expenses associated with project 
monitoring activity, or both. Making this change, however, would 
require an amendment to the FAIR Act.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. We anticipate that a reporting of reliable data regarding 
AARCC's net present value and the annual rate of return on its 
portfolio investments will be delayed by a year. AARCC's performance 
plan submitted as part of its fiscal year 2000 budget request showed 
hard data as being available at the end of fiscal year 1999. Due to an 
unexpected reduction of 50 percent in AARCC's fiscal year 1999 
appropriation, funds were not available during fiscal year 1999 to let 
the RFP required to secure an outside valuation of the AARCC portfolio. 
This activity has been postponed until fiscal year 2000 and will not be 
complete in time to meet the March 2000 deadline for issuing AARCC's 
first annual performance report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. AARCC's funding requests are specified in its business 
plan, which ties future requests to anticipated returns on the 
investment portfolio. AARCC has identified a 20 percent annual rate of 
return as a performance goal for fiscal year 2000. This translates into 
anticipated cumulative repayments of $1.7 million and a subsequent 
appropriation request of $15 million.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. AARCC has only one performance goal, to accelerate 
commercialization of industrial and consumer products made from 
renewable agricultural, forestry, and animal by-product raw materials. 
Consequently, all resources available to AARCC in a given fiscal year 
are dedicated to accomplishing that goal.
                     Agricultural Marketing Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. We have developed a strategic plan that includes goals and 
objectives that are linked to each budget activity within AMS. Internal 
semi-annual and external annual performance reporting ensure the 
agency's compliance.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Every AMS senior executive's performance standards include 
an element requiring effective leadership and timely action in 
implementing established program goals and objectives.
    Question. How is performance information being used to manage the 
agency?
    Answer. Through effective leadership, adapting to changing 
priorities, and the ability to develop and carry out goals and 
objectives, the agency's senior executive staff manage their respective 
programs by utilizing performance data information.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. AMS funding requests for fiscal year 2000 reflect both 
program performance and the changing agricultural market structure. For 
example, the marketing of U.S. products is increasingly influenced by 
changes in the international marketplace. The fiscal year 2000 budget 
request includes funding to expand reporting in foreign markets and 
development of organic certification to enhance the international 
trading of U.S. agricultural products.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. AMS' Strategic Plan and fiscal year 2000 Annual Performance 
Plan include specific objectives to improve performance. Two examples 
are the implementation of the organic standards program and the 
restructuring of the dairy marketing agreements and orders program. AMS 
plans to implement national organic production and labeling standards, 
and implement an accreditation and certification program using those 
standards to achieve its goal of facilitating the strategic marketing 
of U.S. agricultural products in domestic and international markets. 
Through reorganization and streamlining, AMS continues to reform the 
Milk Marketing Order Program to achieve its goal of ensuring fair and 
competitive agricultural marketing through marketing tools and 
regulations.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance plan includes a performance goal for each 
AMS budget activity.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. Since the linkage is direct, no changes are necessary to 
the account and activity structure in the budget justification.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. AMS expects to have reliable data for the first performance 
report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. As in the past, future funding decisions will be based on 
both program performance and changing marketing structure.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Each of AMS' budget requests are associated with goals in 
the performance plan and reflect the full agency costs in carrying out 
that goal, including overhead.
                     Agricultural Research Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act? Answer. As 
Administrator, I have supported the development of the Agency's outcome 
oriented strategic plan and streamlined the National Program Staff in 
order to more effectively manage the research program. Also, I have 
strongly supported the GPRA workgroup recommendation to aggregate the 
Agency's more than 1,100 research projects into a National Program 
structure. These changes have helped to reinforce the attention of ARS 
scientists and managers on producing research outcomes that directly 
address issues and problems confronting American agriculture. In 
addition, the creation of National Programs has greatly strengthened 
the interactions between ARS and its customers, partners, and 
stakeholders. While many aspects of research do not lend themselves to 
a strict performance-based management regime, the changes that have 
been made in the management of ARS' research program will move the 
Agency in that general direction.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The principal tool for moving the agency towards a greater 
focus on performance management is the development and full 
implementation of the National Programs. The National Program Staff is 
the component primarily responsible for managing the ARS research 
program. Each National Program Leader has an element in his/her 
performance standards that require him/her to plan, organize, and hold 
customer workshops that are essential to shaping each National Program. 
The Annual Performance Plan and the Annual CRIS Project Report, were 
just completely revised to make them more responsive to performance-
based management.
    Question. How is performance information being used to manage the 
agency?
    Answer. The 23 new National Programs are the principal components 
of the Agency's approach to programmatic accountability. The National 
Programs support the ARS Strategic Plan 1997-2002 and each is focused 
on specific short- and long-term outcomes. Performance information 
(both current and projected up to two years) is the basis of the Annual 
Performance Plan and the Annual Performance Report. The National 
Program Staff is currently developing a brief annual report for each of 
the 23 National Programs which will be available on the ARS home page 
this summer. NPS also plans to comprehensively review its performance 
information data gathering efforts (both substance and process) before 
it begins to collect information on fiscal year 1999 performance.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. In the ARS Annual Performance Plan covering fiscal years 
1999 and 2000, the Agency specifically identified performance measures 
that will be achieved if Congress concurs with the budget request. 
While research does not lend itself easily to the use of numerical 
metrics, the enactment of GPRA has begun to change the culture of ARS 
by strengthening the Agency's focus on the ultimate outcome of its 
work.
    As an example of how ARS displays fiscal year 2000 requests for new 
or additional funding in its Annual Performance Plan, under Performance 
Goal 2.1.2.1, ``Demonstrate new integrated technologies to protect 
plants, animals, and ecosystems,'' ARS is requesting increases of:
  --$1,667,000 for areawide integrated pest management programs, and 
        IPM component technology for fruits and vegetables treated with 
        organophosphates and carbamates and pests under large-scale 
        action agency eradication.
  --$1,500,000 for the Office of Pest Management Policy.
  --$900,000 for wheat and barley scab research.
  --$1,000,000 for research on brucellosis vaccines for wildlife.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. In response to the enactment of GPRA, ARS completely 
changed the way it manages its research program. Traditionally, the 
Agency managed its research through 1100 plus individual CRIS projects. 
A workgroup was established in 1994 to develop recommendations on how 
best to implement GPRA in a research agency. Based on its 
recommendations the various research projects were organized into 
National Programs. The National Program Staff with considerable input 
from ARS scientists, customers, stakeholders, and partners, developed 
23 National Programs which are now being refined and implemented 
through a series of workshops. The National Program structure will far 
more effectively focus the work of the Agency on achieving the goals 
and objectives identified in the 5-year Strategic Plan and the 
AnnualPerformance Plans than would the previous approach.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance goals are directly linked between the 
Strategic Plan and the Annual Performance Plans. The Performance Plan 
is linked, at the level of the five General Goals, to the traditional 
budget accounts by a crosswalk.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No specific changes in the appropriation account and 
activity structure are anticipated at this time. However, if the new 
National program structure proves to be a useful framework for setting 
forth annual program goals for research activities in ways that improve 
results and accountability, then the appropriations committees and the 
Department may consider changes in the budget activity structure. The 
Department would consult with the committees to ensure any changes 
would improve the budget appropriation process from both the executive 
branch and Congressional perspectives.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. After considerable internal study and wide-ranging informal 
discussions with other Federal research agencies, ARS concluded that it 
could not meaningfully display its accomplishments of its research 
program using numerical metrics as envisioned in GPRA. In the 
Explanatory Notes that accompanied the Agency's fiscal year 1997 budget 
request, ARS provided a preliminary performance plan that counted 
scientific publications, new CRADAs, patent applications, and so forth. 
The information generated by that approach did not even remotely 
address the intent of GPRA. As a result, ARS requested a waiver under 
GPRA to use a narrative approach. OMB concurred. Following the 
structure of the ARS Strategic Plan 1997-2002, the Annual Performance 
Plan for fiscal years 1999 and 2000 identifies approximately 150 
specific anticipated accomplishments for each year that, if achieved, 
will enable the Agency to meet its performance goals. Even though GPRA 
does not require a performance report until March of 2000, ARS decided 
to complete its first report covering over 150 milestones that had been 
identified in last year's Annual Performance Plan. Each fiscal year 
1998 indicator of progress (anticipated accomplishment that 
demonstrates progress towards a longer term goal) has a narrative 
description of what was actually accomplished and a description of the 
outcome or impact of that work. ARS demonstrated its commitment to 
programmatic accountability by developing a combined document 
containing the Annual Performance Report for fiscal year 1998 and the 
Annual Performance Plan for fiscal years 1999 and 2000 a year ahead of 
the statutory requirement.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. As mentioned earlier, since it was not possible to 
meaningfully track research with numerical measures, ARS requested a 
waiver under GPRA to use a narrative approach concurred to by OMB. 
Following the structure of the ARS Strategic Plan 1997-2002, the Annual 
Performance Plan for fiscal years 1999 and 2000 identifies 
approximately 150 specific accomplishments or milestones that the 
Agency anticipates achieving in each fiscal year. Successful 
achievement of these milestones will indicate progress towards the 
broader goals and objectives contained in the strategic plan. If the 
agency successfully meets most of these milestones, the Congress can 
have confidence that steady progress is being made towards the General 
Goals.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Because of the ongoing nature of research, the Annual 
Performance Plan anticipates milestones and outcomes which the Agency 
anticipates accomplishing in fiscal years 1999 and 2000. The Plan does 
not associate specific funding to these anticipated accomplishments. 
Where the Plan does directly link specific levels of resources with 
research activities is in areas where the fiscal year 2000 budget 
requests ``new'' money. In the most recent Plan, ARS has identified 
over 45 anticipated accomplishments that would occur if Congress 
approves the budget request.
               Animal and Plant Health Inspection Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The APHIS Administrator will incorporate elements into all 
senior managers performance standards which help focus management on 
desired program results, consistent with Government Performance and 
Results Act (GPRA) requirements. He has also involved managers 
throughout APHIS programs in revisiting their Annual Performance Plan 
goals, indicators, and targets; by doing so, they have clarified and 
refined the Agency's fiscal year 2000 plans.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The performance of senior managers will be reviewed and 
judged based on their attainment of GPRA goals.
    Question. How is performance information being used to manage the 
agency?
    Answer. One of the major benefits of focusing on GPRA requirements 
has been the establishment of baseline data to determine where our 
programs currently stand in terms of results. This information will 
enable us to track progress and trends, set more accurate targets, 
communicate results to our stakeholders and customers, and make 
management decisions based on actual performance information.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Program performance was a key factor in the resource 
allocation decision process in APHIS. For instance, the success of the 
Brucellosis Program as measured by the reduction in the number of 
infected herds resulted in the decision to request a reduction in 
funding for that line item in fiscal year 2000. APHIS requested 
additional funding in the Horse Protection line item to improve program 
performance by allocating the additional resources to increase the 
number of audits and monitored horse shows, and to expand training for 
inspectors.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Programs in APHIS have established strategic and 
operational plans at lower levels in the organization, including field 
levels, to ensure that program managers throughout the agency are able 
to prioritize their work so that GPRA goals are met and so that Agency 
activities are aligned in such a way as to enable successful 
accomplishment of targets.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. They are directly linked. The five functional components of 
the agency's budget structure (Pest and Disease Exclusion, Plant and 
Animal Health Monitoring, Pest and Disease Management, Animal Care, and 
Scientific and Technical Services) correspond to the five general goals 
of the APHIS strategic plan. In the annual performance plan, APHIS has 
developed a set of annual performance targets for each goal of its 
strategic plan. The objectives listed under each goal in the annual 
performance plan correspond directly to funded pest and disease 
programs under each functional component.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. We do not believe that changes to the budget account and 
activity structure would significantly improve the linkage between 
resource amounts and performance goals.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. There may be measures for which the reliability of the data 
used to assess performance could be improved. In other cases, other 
measures may be better served by alternative data sources other than 
the original data sources identified.
    APHIS benefits from focusing Agency attention on performance data 
because we can help ensure that as information systems are designed and 
implemented, they take into consideration the need for reliable program 
performance data. Similarly, as APHIS interacts with other agencies, 
with other levels of government (e.g., States), with academia and 
private industry, we can focus on identifying other sources of data 
outside of APHIS which can help improve our data. We believe that the 
reliability of our data sources can be tested and enhanced through the 
use of related and supplemental data sources housed elsewhere.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. APHIS will compare projected versus actual accomplishments 
and determine the causal factors for differences between the two. This 
analysis will be driven by the questions, Are we measuring the right 
things? Are we using the right targets/indicators to show the true 
results of the program? Are we operating efficiently and effectively? 
Have the benefits truly outweighed the costs? There may be times when 
unpredicted or external factors may cause us to have to revise or 
redefine targets and indicators. These factors, which are difficult to 
anticipate, may ultimately have a direct and significant impact on 
future funding requests. We intend to constantly monitor and compare 
actual performance to target performance, analyze the gaps, and use 
this information when considering future funding. There is no doubt 
that some changes will occur along the way, to both targets and 
indicators, but APHIS challenge will be to keep enough of our measures 
constant to be able to truly gauge progress.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The dollars associated with specific agency performance 
goals are limited by total available funding which consists of 
appropriated funds and projected funding from other sources. In the 
current budget era, APHIS has had to turn more frequently to its 
partners either at other levels of government, in other agencies, or in 
private industry to help support its goals. Increases in cooperative 
agreements, user fees, and other fee for service opportunities have 
helped narrow the gap between diminishing federal funds and true costs 
to run agency programs, but there are times when the gap still exists.
    Opportunity costs are often incurred by the agricultural community 
as well, and they are not necessarily captured in the dollar amounts 
reported by APHIS for each performance goal. APHIS may have goals 
geared toward eliminating diseases of farm animals, for instance, and 
may track APHIS activities focused on assisting farmers in preventing/
managing diseases. However, it is difficult to determine what it really 
costs a farmer to have to destroy part of a herd because it was 
diseased, even though it helped APHIS to prevent further spread of the 
disease. On the other side, it is difficult to gauge the economic 
effects of farmers no longer requiring loans from USDA if APHIS has 
helped them to enhance their financial solvency through pest and 
disease management.
    Still other opportunity costs exist. For instance, because most 
Americans are disconnected with agriculture, they lose sight of the 
difficulties inherent in a system with few producers to provide food 
and fiber to a great many consumers. Each time a farmer or rancher goes 
out of business because of bad weather conditions or lack of methods 
(such as chemicals for crop protection or tools for livestock 
depradation control) to protect their agricultural inventories the 
agricultural community suffers. Greater responsibility falls upon fewer 
producers to supply an increasing population with greater varieties and 
quantities of food.
    APHIS does not have a separate line item for overhead costs. The 
dollars associated with specific performance goals include overhead 
costs.
      Cooperative State Research, Education, and Extension Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. Programs managed by the Cooperative State Research, 
Education, and Extension Service (CSREES) are based on five GPRA goals 
that were developed over a period of 18 months in consultation with the 
land-grant university partners. The allocation of program funds by 
CSREES are based on an appropriate response to the goal(s). It becomes 
the responsibility of each Director/Administrator receiving funds from 
CSREES to develop a performance plan that covers at least 5 years. The 
performance plan describes objectives, performance goals, performance 
indicators along with outcome and outcome indicators. To assess the 
appropriateness and relevance of the performance plan submitted by each 
State, a review is conducted of each plan by CSREES National Program 
Leaders and Deputy Administrators. This merit review forms the basis 
for the allocation of formula funds. Each year, the same institutions 
submit an annual performance report to the agency to describe 
accomplishments made against the performance plan. Reviews of these 
submissions provide the basis for the agency performance plan and 
report. Using this procedure, the agency is in a strong position to 
eliminate program duplication and recommend the use of funds to address 
issues of national importance where Federal research and education can 
generate the greatest impact.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The agency strategic and performance plans form the basis 
for evaluating agency and executive accomplishments. Each agency 
executive is held accountable for his/her influence in setting goals 
for the agency and leadership in influencing the development of agency 
program priorities. Progress is assessed during regular meetings and in 
CSREES executives' mid-year and annual performance reviews.
    Question. How is performance information being used to manage the 
agency?
    Answer. Performance information is being used to frame the agency 
performance plan and provide guidance in the USDA budget priority 
setting process. The success of this effort is best demonstrated in 
joint development and publication of annual impact statements that 
highlight significant system achievements in research and education. 
The impact statements have focused on issues that are important to the 
Nation, and have had a positive impact in helping stakeholders 
understand the value added by the investment made in Federal funding 
and the need to redirect resources to address relevant issues, 
particularly when gaps in information are identified.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answers. Agency performance is assessed based on how well it 
allocates resources and support project needs that are relevant to the 
U.S. Department of Agriculture. This was reflected in decisions made in 
the President's Budget for fiscal year 2000. The following are examples 
of issues that can be addressed by CSREES: Development of new 
surveillance methods for foodborne diseases; deliver information to at-
risk populations to improve nutrient intake; focus on animal waste 
management to prevent the pollution of air, soil and water resources; 
enhance child care programs in targeted communities; develop program 
delivery strategies for Native American communities to improve health, 
enterprise management and community development and nutrition; improve 
entrepreneurial business skills for small farmers to establish viable 
farm operations and enterprises; integrate production, processing and 
distribution systems for generation of high value products; study how 
pathogens are introduced into the production environment, how they 
survive to contaminate foods, including fresh fruits and vegetables; 
develop alternatives needed for safe substitutes for commonly used 
pesticides; etc.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Developing a comprehensive strategic plan with annual 
performance plans has encouraged the agency to focus on things that are 
important to the accomplishment of specific goals. It has changed from 
a previous organizational culture that tried to ``be all things to all 
people''. The agency strategy has created an environment that 
recognizes the value of focusing on a few issues that are relevant and 
can be accomplished within the resources provided.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The agency budget structure links all mechanisms of support 
(or budget line items) to the five goals outlined in the strategic plan 
through use of a crosswalk budget table. This allows performance goals 
and measures to be developed that support the budget and respond to the 
Congressional accountability mandate of GPRA. This will result in 
output and outcome measures that will be documented in future annual 
performance reports prepared by CSREES.
    Question. What, if any changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No specific changes in the appropriation account and 
activity structure are anticipated at this time. However, if a 
different program structure proves to be a useful framework for setting 
forth annual program goals for research activities in ways that improve 
results and accountability, then the appropriations committees and the 
Department may consider changes in the budget activity structure to 
reduce the complexity of crosswalks that we use at the present time. 
The Department would consult with the committees to ensure any changes 
would improve the budget appropriation process from both the executive 
branch and Congressional perspectives.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improved the reliability 
of these measures?
    Answer. The agency believes that it will have reliable data in time 
for the first performance report in March 2000. We have used the annual 
performance report experiences over the past two years to refine 
performance measures based on the agency strategic and performance 
plans.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. We believe that the Government Performance and Results Act 
will require us to document actual performance compared to expected 
targeted performance. This lets us learn from past experiences and 
become better at projecting targeted performance as an estimate of 
resources needed to conduct programs.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The dollars associated with the performance goals represent 
the total amount appropriated for CSREES programs including federal 
administration funds retained by the agency to administer the programs. 
In addition, estimated reimbursable funds and mandatory funds for 
programs administered by CSREES are included.
                      Departmental Administration
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. In 1998, the Acting Assistant Secretary, began a re-
examination of how the performance goals and objectives were affecting 
operations and customer service within Departmental Administration 
(DA). New streamlined goals were identified which could better guide 
performance to the essential business roles of the DA Staff Offices. 
These new goals and objectives stress the two essential elements of DA 
business responsibility: Leadership, oversight and coordination to 
improve management of program and administrative systems throughout the 
Department; and the delivery of timely, reliable and efficient services 
to Department agencies.
    Last Fall, DA managers met in consultation with the staff of the 
House Committee on Government Operations and other staff from the 
Congress to explain this change and seek their guidance. A Strategic 
Plan was initially drafted and Performance Plans were developed for the 
fiscal year 2000 Budget. We are now operating under this Performance 
Plan, which was developed by DA senior leadership.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The fiscal year 2000 Budget contains a Performance Plan for 
fiscal year 1999 and 2000 which relates the DA goals and objectives 
directly to accomplishments in each Staff Office area. The new Plan 
identifies key elements of accomplishment in areas that can be directly 
related to performance in each Staff Office and progress is reviewed on 
a regular basis.
    Question. How is performance information being used to manage the 
agency?
    Answer. Under the restricted budget situation in which all DA 
operations find themselves today, there are constant questions on how 
to best use scarce resources. The Performance Plan provides an index of 
progress/accomplishment across the spectrum of DA program activity. 
Although the performance factors are relatively new, there is a 
potential to manage the allocation of resources by prioritizing program 
accomplishments and shifting resources to meet critical program needs.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. In the budget years immediately preceding the fiscal year 
2000 Budget, DA operated under strong program priorities aimed at 
reversing the negative trends which had been identified in the 
Department's civil rights record. Budget decisions followed these 
priorities. In the development of the current budget, DA re-examined 
other policy support and service responsibilities as well. A new 
Strategic Plan and performance goals and objectives were identified in 
internal workshops and in consultation with the Congress. The heart of 
the current budget proposal is the focus on these performance elements 
which reflect the new Strategic Plan focus on customer service.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. As a continuation of the development of the focus on 
service to customers, DA is currently engaged in an examination of its 
service responsibilities and whether its functions are supported by the 
current organizational structure. Some realignment of functions and 
organizations may be needed. The objective is to have the program 
assignments and organization in place by September 30, 1999.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The current Performance Plan and the performance measures 
reflect the budget structure. Key performance measures have been 
identified in each major area so that the accomplishments can be 
measured against the resources used.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. As previously stated, DA is currently undergoing an 
examination of its functions and organization. Changes will be 
implemented by the end of this fiscal year and will be reflected in the 
next budget cycle (fiscal year 2001). As part of the organizational 
planning, the budget structure will be adjusted to closely reflect the 
key operations and responsibilities of DA.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. The current Performance Plan contains measures which can be 
tracked and should not present any problems in developing the first 
performance report next year. As adjustments are made, the availability 
of data to support key measures will continue to be an important 
criterium.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The development of future budgets will assess the 
priorities and cost of achieving the performance elements identified in 
the Performance Plan. Unproductive or extremely inefficient program 
objectives will be de-emphasized in favor of more critical and more 
productive program elements. Experience with the performance measures 
will be used in assessing the critical budget criteria of: whether the 
program/activity should be continued, identifying the appropriate roll 
for DA, and determining whether the DA operating plan for the program/
activity is efficient and productive.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The current resource costs identified in the Performance 
Plan by goal reflect the total amount of full time equivalent (FTE) 
employment and dollars used by DA in each area. This includes directly 
appropriated funds, reimbursements from customers and working capital 
funds. Overhead, such as management, training and facilities costs are 
allocated to the goals on a pro rata basis.
                       Economic Research Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The ERS Administrator has taken a number of significant 
steps toward achieving performance-based management. The most ambitious 
activities relate to evaluating the effectiveness of ERS research and 
analysis in achieving the agency mission and goals. They are providing 
useful insights into program strengths and weaknesses. Stakeholders and 
customers have played a central role in these evaluation efforts, which 
include:
  --A major 2-year review of the ERS program by the National Academy of 
        Sciences National Research Council, which is now complete and 
        will be released in final form very shortly. The report 
        addresses key aspects of ERS operations, including the need for 
        formal instruments that allow clients to assess the suitability 
        of ERS to perform any given analytical task and the need for 
        peer review of individual scientists. A new process for 
        accomplishing the latter is already underway. The report also 
        provides recommendations on means of assessing the balance 
        between intramural and extramural research, particularly 
        focusing on ways to expand the extramural program. ERS has 
        already taken some steps in this direction in its extramural 
        program in support of the Food and Nutrition Research Program.
  --A review of the market for economic information on commodity 
        markets. The need for, availability of, and access to economic 
        information on agricultural markets has changed significantly 
        during the last decade. In response, ERS has undertaken a study 
        to determine the value placed on different types of 
        agricultural market information by decisionmakers in the public 
        and private sectors. The first phase, now nearly complete, 
        focused on public sector information users, soliciting 
        information from USDA agencies, the Congress, and other 
        Government agencies. The second phase will focus on private 
        sector information users.
    The ERS Administrator played a valuable role as a member of the 
management advisory team overseeing an assessment of USDA's Interagency 
Commodity Estimates Committee process. This cross-cutting review is 
aimed at improving the efficiency and efficacy of the Department's 
process for developing commodity estimates. ERS not only provided 
funding, but is also providing major staff support for implementation. 
In addition, in the last year, ERS has begun development of a single 
comprehensive tracking system for its products to replace the multiple 
tracking systems currently in place, and a system to more 
systematically ensure that customers are getting the products and 
services they need. Finally, the Administrator has assigned a senior 
staff member the responsibility of investigating and developing 
evaluation methods and approaches to assure the relevance and quality 
of ERS research. Question. How are your agency's senior executives and 
other key managers being held accountable for achieving results?
    Answer. Responsibility for achieving program goals is written into 
the performance elements and standards of all senior executives and 
branch chiefs. To make those standards concrete, ERS senior executives 
and branch chiefs prepare an integrated set of division plans of work, 
articulating expected results that will contribute to achievement of 
agency goals. They provide an effective means of linking day-to-day 
activities to strategic and performance goals. In addition, the 
assessment by the National Research Council, the market information 
study, and the systems being developed to track products and customers 
all are providing means of evaluating success in achieving results.
    Question. How is performance information being used to manage the 
agency?
    Answer. The recommendations from the National Research Council 
report and information from the other assessments currently underway 
will provide significant guidance for ERS managers. For example, the 
market information study, by examining how the need for and the 
availability of economic information on agricultural markets has 
changed over the last decade, is assisting ERS in designing a market 
outlook program to meet the needs of a dramatically changed U.S. 
agriculture. As another example, in 1998, ERS created its first-ever 
``inventory'' of all the work underway for each USDA mission area and 
then used it to initiate discussions within USDA on how to achieve more 
effective collaboration.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. In considering potential budget requests, ERS has always 
analyzed its program for gaps that could be filled by additional or 
different research and analysis. In deciding on fiscal year 2000 
funding requests, that analysis was aided by the framework provided by 
ERS strategic and performance plans. Also helpful were increased 
efforts to incorporate customer feedback into discussion and decisions 
on programs.
    For example, ERS has an ongoing program of work in commodity market 
analysis. This program provides the analytical underpinning for the 
Department and Agency situation and outlook programs. ERS requested 
additional funds for this program for fiscal year 2000 after ongoing 
and intensive program reviews, along with consultation with other USDA 
agencies, and feedback from outside users. It was clear that changes in 
the policy and trade environment made it vital for ERS to ensure 
sufficient capacity to analyze the structure and performance of 
commodity markets and to augment the analytical expertise on which 
Department forecasting is based. User feedback also made it clear that 
better and quicker access to ERS information was essential. All of 
these needs were encompassed in the ERS funding request.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Within the context provided by the agency's strategic and 
annual plans, the need for planning and organizing some types of 
research across organizational units of ERS was clarified. As a result, 
the agency moved to initiate cross-unit activities where appropriate. 
The best example is creation of the Structural Change in Agriculture 
Organizing Team. The team, which is composed of researchers from all 
three ERS program divisions, is developing a major new agency program 
of work. Their efforts promise to provide critical insights that will 
significantly contribute to meeting ERS's goal of providing 
policymakers and others with quality analyses on issues related to 
structural change in agricultural industries. Other groups reflecting 
the priorities set in the ERS plans and utilizing cross-agency 
expertise are working on revenue insurance, trade and the environment, 
biotechnology, and rural amenities.
    Since ERS's program is one of research and analysis, a key 
performance indicator used for every goal is the percentage of 
published research that meets peer review standards. Peer review of ERS 
products is a basic tenet of the ERS program. To ensure that the 
rewards system for staff reflects the agency's goal of developing high 
quality, relevant research, ERS has recently initiated another kind of 
peer review--of the positions of individual analysts. The new Economist 
Position Classification System is helping to ensure that economists are 
recognized for the impacts of their achievements.
    Each of the ERS performance goals indicates that information will 
be provided to ``policy makers, regulators, program managers, and 
organizations shaping public debate'' in a timely fashion. In fiscal 
year 1998 and fiscal year 1999, the agency took steps to more 
systematically identify ERS customers and manage the information flow 
to them. These efforts, which are moving toward implementation, include 
the development of an automated system for managing customer services. 
The system will provide an economical means of ensuring that customers 
have ERS information when they need it and in the form they find most 
useful.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. ERS's budget has one appropriation item, economic analysis 
and research. The Performance Plan's five goals are linked and 
dependent on funding levels allocated within the agency.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. ERS does not propose any changes to its account structure.
    Question. Does the agency's fiscal year 2000 Results Act 
performance plan include performance measures for which reliable data 
are not likely to be available in time for the first performance report 
in March 2000. If so, what steps are planned to improve the reliability 
of these measures?
    Answer. ERS will have sufficient and reliable data to complete its 
March 2000 performance report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. If actual performance does not reach the target performance 
levels, ERS will review the goal to ensure that it is attainable and 
the indicators to ensure that they are appropriate. If both are 
realistic, the agency will assess the possibility of achieving the 
targets by management or programmatic changes. If neither of these non-
budget approaches is likely to attain the desired results, reallocation 
of current funds or a request for additional funds will have to be 
considered.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The dollars associated with agency performance goals fully 
reflect the full costs of associated activities in support of the 
goals, including overhead costs.
                      Foreign Agricultural Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. FAS has adopted the philosophy that, in order to achieve 
true performance-based management within the agency, as required by 
GPRA, we must institutionalize it at every level of the organization. 
To that end, beginning in fiscal year 1997 and continuing in fiscal 
year 1998, FAS conducted strategic planning workshops with every 
division in the agency.
    FAS is currently conducting weekly half-day conferences with a core 
group of key agency officials to move the process forward another step 
this year. FAS's ultimate goal is to link what every employee is doing 
to support the organization-wide goal. Through the business processes 
we are implementing, we are building the organizational capacity to 
achieve performance-based management within the agency.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Effective October 1, 1998, FAS implemented a performance 
reporting system, where each key manager is required to report on a 
quarterly basis his or her accomplishments relative to his or her 
assigned primary and support responsibilities. The primary and support 
responsibilities come directly from the agency's annual performance 
plan. All senior executives and managers in the agency have a critical 
performance element in their standards of performance which holds them 
accountable for this reporting requirement.
    Question. How is performance information being used to manage your 
agency?
    Answer. The performance information currently being reported on a 
quarterly basis by executives and managers is being used to make mid-
course adjustments as necessary to help the agency accomplish its goals 
and outcome targets. Additionally, FAS is currently in the process of 
adding a second stage to its performance reporting system that will 
significantly enhance the agency's ability to track performance in a 
way that it can be related to results and used to manage the agency 
more efficiently and effectively.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples?
    Answer. Program performance factored heavily into FAS's budget 
request for discretionary spending in fiscal year 2000. For instance, 
two new initiatives for fiscal year 2000 determined by FAS to be highly 
beneficial to U.S. export promotion are the South African Agricultural 
Trade Office (ATO) and the Reverse Trade Missions. The South African 
ATO proposal supports the President's Africa Initiative which 
recognizes the potential market for U.S. agricultural products. South 
Africa is the hub of southern Africa's trade, finance, and 
transportation infrastructure. The Commerce Department agrees with FAS' 
assessment of U.S. trade potential in southern Africa as it too has 
proposed nearly a dozen new Commercial Service positions in the region 
for fiscal year 2000. Reverse Trade Missions, that is, bringing foreign 
buyers to U.S. trade shows to orient their focus on the quality and 
diversity of U.S. agricultural products, is an established and well 
utilized program by our competitors. This approach has higher sales 
potential per cost, especially for small and medium-sized U.S. firms 
without the ability to participate in foreign trade promotion 
activities.
    Question. What specific program changes has the agency made to 
improve performance and achieve goals established in the strategic and 
annual performance plan?
    Answer. Two major changes have been made to improve performance and 
achieve FAS's strategic goals and objectives. Both focused on improving 
customer service. FAS is scheduled to receive the Vice President's 
Hammer Award for one of the changes, and the other is being nominated 
for a Hammer Award.
    The change that resulted in a Hammer Award was focused on improving 
the administration of the Food for Progress (FFP) program. FAS 
administers the FFP, which provides commodities for donation through 
Private Voluntary Organizations (PVOs) to support developing countries 
that have made commitments to expand free enterprise in their 
agricultural economies. The overall processes of the program had been 
layered one on top of each other over the years. This resulted in PVOs' 
requests for funds not being turned around in a timely fashion--
administrative delays of up to forty (40) business days were common.
    The management team of FAS recognized that something had to be done 
to improve efficiency. A management team was organized to tackle the 
problem. Over a period of 18 months, the team made tremendous gains in 
operational efficiency by eliminating numerous and redundant reviews, 
re-evaluating the current tasks and making them more cohesive, 
providing more accountability to their customers (in this case the 
PVOs), and reducing the average cycle time of transferring 
administrative support funds to a particular PVO from forty-one (41) to 
seven (7) business days.
    The other major program change the agency has made over the past 
two years has been the implementation of a Unified Export Strategy 
(UES), designed to provide industry partners with the opportunity for 
one-stop customer service. The philosophy is that FAS has a suite of 
program tools funded by Congress to effect changes in behavior in 
markets around the world, which in turn positively influence the 
ability of exporters to sell U.S. farm products in foreign markets 
around the world. The UES is designed to help FAS deploy its suite of 
program tools in a highly integrated manner to maximize the return on 
public investment for its services.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. Strategic objectives in the annual performance plan are a 
mirror image of the program activities reported in the agency budget 
structure. The stated performance goals underneath each objective in 
the performance plan link directly to budgeted resource amounts in the 
current fiscal year 1999 budget and the proposed fiscal year 2000 
budget.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. A core team of senior managers within the agency is 
currently in the process of evaluating alternative options to improve 
this linkage. Additionally, as FAS learns more about institutionalizing 
performance-based management processes, the potential need may arise 
for further changes to adjust the agency's budget and planning 
structure to accommodate changes in legislation, international trade, 
and technology.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are being planned to improve reliability 
of these measures?
    Answer. It is possible that the fiscal year 2000 Results Act 
performance plan may include performance measures for which reliable 
data will not be available in time for the first performance report due 
to Congress in March 2000. The process of making GPRA a reality in FAS 
is still ongoing. FAS is working to refine its performance measurement 
criteria and its performance reporting system to ensure that reliable 
data and measures are available in the future to track performance. FAS 
believes a more realistic time frame target for ensuring reliable data 
is available to it and other government agencies it works with in 
achieving its goals would be by the end of fiscal year 2000, not mid-
year.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. Once the agency has a track record to reference, the agency 
plans to use actual performance compared to targeted performance, 
combined with external factors that may have inhibited reaching a 
targeted goal, to set priorities in its future funding requests.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full cost of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The dollars associated with specific agency performance 
goals generally reflect the cost of all associated activities performed 
in support of that goal. Overhead costs are proportionately 
distributed, with approximately 75 percent allocated to General Goal 
#1, ``Expand export opportunities,'' and approximately 25 percent 
allocated to General Goal #2, ``Promote world food security.''
                          Farm Service Agency
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. In order to achieve performance-based management, as 
required by the Results Act, Farm Service Agency (FSA) has:
  --Established a Senior Management Planning and Controls Committee 
        (SMPC). The SMPC's strategic management functions include: 
        providing leadership, commitment, and guidance to the Agency 
        strategic planning program; providing strategic direction for 
        the Agency by establishing strategic goals; overseeing 
        development and implementation of Agency strategic plans and 
        annual performance plans required by GPRA; and communicating 
        GPRA results to Congress, the Administration, customers, and 
        other stakeholders.
  --Established the Strategic Management and Corporate Operations Staff 
        within the Office of the Administrator, which works closely 
        with the SMPC to carry out the Agency's strategic management 
        initiatives.
  --Established key contacts in each program/administrative area that 
        are responsible for developing, implementing, and monitoring 
        performance goals and measures.
  --Developed a strategic plan for fiscal years 1997-2002 and annual 
        performance plans for fiscal year 1999 and fiscal year 1999/
        2000.
    Specific examples of efforts to implement performance based 
management include the following.
  --The farm loan program annual performance goals and measures are 
        reflected in the goals for each State. These goals and measures 
        were developed to achieve the desired results outlined in the 
        strategic plan. The State Executive Director for each State is 
        held responsible for achieving these goals.
  --The Deputy Administrator for Commodity Operations (DACO) is 
        conducting a complete review of the Agency's commodity 
        procurement and warehouse licensing and examination procedures. 
        This review involves industry and customer interviews, 
        development and analysis of alternative ways of conducting 
        these functions, and cost analysis of such alternatives. This 
        review will result in recommendations to improve the efficiency 
        and performance of the licensing and procurement operations. 
        The review team is learning the importance of knowing what 
        customers want and being pro-active in meeting customers needs.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Performance plans for Agency senior executives contain 
performance standards related to achieving Agency goals and objectives, 
improving management, and reducing program and administrative costs.
    Additionally, FSA's Administrator has a separate performance 
agreement on Equal Employment Opportunity/Civil Rights (EEO/CR) which 
includes specific goals and measures by which the Administrator will be 
rated. The Agency's Deputy Administrators' performance plans contain a 
performance element and standards directly linked to accomplishment of 
the Administrator's EEO/CR goals.
    Question. How is performance information being used to manage the 
agency?
    Answer. Starting in June 1999, program managers will be responsible 
for monitoring performance data and submitting quarterly reports to the 
Strategic Management and Corporate Operations Staff. Monitoring 
performance on a quarterly basis will allow the Agency to make 
adjustments in a timely manner, helping to ensure achievement of 
performance goals.
    Examples of how the Agency is currently using performance 
information include:
Farm Loan Programs
    Field office goal accomplishment is monitored at least monthly by 
both State and National Offices. This monitoring process reveals trends 
and problems as they develop, resulting in FSA revising policies and 
redirecting resources, as appropriate.
Commodity Operations
    FSA is closely monitoring the timeliness of commodity shipping. FSA 
no longer accepts bids from contractors that ship late at bid opening. 
Such bids are treated as non-responsive.
    DACO is evaluating the possibility of establishing licensing and 
examination criteria and fees based on the warehouse operators' past 
performance rather than solely on capacity.
    DACO is moving to implement Total Quality System Audits (TQSA) for 
commodities purchased for feeding programs. Under TQSA, the 
manufacturer of such products is responsible for maintaining the 
quality of the product.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Funding decisions for fiscal year 2000 were primarily based 
on Agency priorities relative to carrying out the Agency's mission. 
However, program performance was considered in developing funding 
requests from the standpoint of whether sufficient funds were being 
requested to operate a viable program.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual performance plans?
    Answer. The following are specific examples of program changes 
implemented by FSA.
Goal 1, Farm Programs
    Noninsured Crop Disaster Assistance Program (NAP).--During fiscal 
year 1998, FSA authorized seven pilot FSA State Offices to approve NAP 
areas and supporting market price and crop yield data. Review of the 
pilot, assessing increases in timely processing of NAP area requests 
and claim payments, will be made in fiscal year 1999. Assuming expected 
improvements in processing NAP areas and producer claims, authorization 
can be granted to additional States in fiscal year 1999 and fiscal year 
2000.
    Loan Deficiency Payments (LDPs).--Significant policy changes to 
help farmers who are experiencing low commodity prices were announced 
by Secretary Glickman on September 11, 1998. These policy changes make 
producers who harvest eligible wheat, feed grains, or oilseeds in forms 
other than whole kernel, such as silage and cobbage, eligible for 
marketing assistance loans or LDP's. High moisture commodities, 
commodities containing contaminants, such as aflatoxin, and low quality 
commodities will also be eligible. It is expected that these program 
changes will result in increased producer participation in the 
marketing assistance loan and LDP programs in 1999 and future years, as 
economic conditions warrant.
    Livestock Assistance Program.--Compared to previous livestock feed 
assistance programs, the application process for this program was 
streamlined and the reporting burden on producers was reduced by 
relying heavily on producer certification of losses and not requiring 
the producer to purchase feed in order to be eligible for assistance.
    Crop Loss Disaster Assistance Program.--Compared to previous ad hoc 
disaster programs, the application process was streamlined and the 
reporting burden on producers was reduced by using existing information 
from losses previously reported to FSA and RMA.
    Tobacco Program.--A preliminary BPR package has been completed for 
the tobacco program as part of a pilot program to automate the 
marketing process for all kinds of tobacco. A pilot project is planned 
for the 1999 burley tobacco marketing season to determine the 
feasibility of national deployment of the new piloted marketing system. 
As funds become available, additional segments of the tobacco program 
will be reengineered. Automating the marketing process will result in a 
less labor intensive, more efficient program.
    Peanut Program.--In an effort to streamline the collection of 
peanut marketing assessments (PMAs), the responsibility for day-to-day 
reconciliations and oversight of deposits has been assigned to the 
three area peanut loan associations. Moving this function, previously 
performed by the Tobacco and Peanuts Division (TPD) at headquarters, to 
the associations allows the reconciliations to be performed closer to 
the buying point and also reduces the workload for TPD personnel. TPD 
maintains overall responsibility for the accurate collection of the 
PMAs.
Goal 3, Farm Loan Programs
    The guaranteed loan program regulation has been totally rewritten 
to streamline the process and make it more user friendly. Particular 
emphasis was placed on streamlining small loan packaging, adding 
program flexibility and developing the Preferred Lender Program. These 
changes should reduce processing time frames, maintain a low loss 
history, speed delinquency resolution, move direct loans into the 
guarantee program, and help the agency target minority farmers. In 
addition, the Agency will soon more fully implement the Debt Collection 
Improvement Act which will permit the Department of the Treasury to 
assist us in the collection of seriously delinquent direct loan 
accounts through offset.
Goal 4, Commodity Operations (Warehouse Examination Operations)
    DACO has increased the use of available technology to increase the 
efficiency of the warehouse examination workforce. Increasing the 
efficiency of the examination workforce permits the Agency to conduct 
necessary examinations with a reduced workforce.
    DACO is expanding the services that warehouse examiners provide in 
order to increase sources of revenue for examination operations. By 
adding services that are needed and requested by the warehouse 
industry, we expect to increase the value of overall United States 
Warehouse Act (USWA) functions, which in turn will increase the number 
of warehouse operators that elect to be federally licensed.
    DACO submitted a draft rewrite of the USWA to the Office of 
Management and Budget (OMB) for their review in April 1998. OMB has not 
commented on the proposed draft. The rewrite will, among other things, 
allow the warehouse industry to increase performance and productivity 
through the use of electronic documents of title (i.e., warehouse 
receipts, bills of lading, shipping certificates, etc.) for 
agricultural commodities.
Goal 4, Commodity Operations (Commodity Procurement Activities)
    All domestic distribution program contracts have been changed to a 
delivery basis versus shipping period basis. This should improve timely 
deliveries since contractors are not paid until products have been 
delivered.
    The rate of liquidated damages for late shipment was increased to 
be commensurate with the value of the commodity.
    Several commodities are now purchased for a longer time period than 
one month. Certain contracts are now made quarterly or on an annual 
basis. This ensures an adequate commodity supply and more of a 
partnership relationship with suppliers resulting in better, more 
timely performance.
    FSA is purchasing more commercial products with brand labels rather 
than special USDA labels. This should improve the quality and 
timeliness of deliveries.
    FSA now purchases peanut butter with specifications equivalent to 
national brands. All peanut butter suppliers must have the product 
tested prior to FSA allowing the firm to participate in the procurement 
program. This qualified product list has resulted in a better quality 
product for recipients.
Management Initiative 1, Equal Employment Opportunity and Civil Rights
    Civil Rights and Small Business Utilization Staff (CR&SBUS) is 
piloting and implementing a new standard operating procedure to perform 
CR State and Service Center Management Reviews. A greater emphasis is 
placed on the farm loan programs, reviewing fewer Service Center 
offices, but focusing more on specific problems in each office. By 
fiscal year 2000, we plan to review some of the Headquarter and Kansas 
City complexes for EEO problems.
    CR&SBUS has instituted tracking systems which will help to quickly 
and accurately track the status of settlement cases, program 
complaints, EEO informal complaints, formal backlog complaints, and our 
EEO informal Early Resolution Program. In addition, these systems 
provide the data needed to analyze and identify areas for improvement. 
This system was needed because the volume of cases and settlements has 
greatly increased since 1997. The Administrator is provided a weekly 
update on each of these items.
    CR&SBUS has established and trained 15 fact finding employees in 
Montgomery, Alabama, who work full-time on gathering the facts of 
program complaints and send them to the Headquarters office for 
analysis. This new system guarantees independent and fair treatment to 
customers, and improves the number of cases processed on-time as stated 
in the FSA Annual Performance Plan.
    CR&SBUS established an EEO informal Early Resolution Program which 
brings complainants and supervisors together early in the process to 
resolve differences before they go formal. This has reduced the number 
of formal EEO complaints registered as stated in the FSA Annual 
Performance Plan. It also helps employee morale by quickly resolving 
management/employee differences and is a cost savings to the Agency.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The FSA fiscal year 1999/2000 Annual Performance Plan and 
Budget discuss the level of resources needed to achieve program 
performance goals. The annual performance plan encompasses all program 
activities included in the agency's budget request, and reflects the 
program activities associated with identified goals. This linkage 
enables decision-makers to assess the FTEs and funding requirements of 
achieving annual performance goals. Performance goals were developed 
for each FSA budget account. These measures are incorporated in budget 
material to indicate expected performance to be achieved based on 
available funding.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. Currently, there are no plans to change the FSA account 
structure for fiscal year 2001, since there is direct linkage between 
the account and activity structure in the budget and the associated 
GPRA program activities for which performance goals have been 
established.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. As reflected in the FSA fiscal year 1999/2000 Annual 
Performance Plan, some performance measures exist for which resulting 
data may not be available for inclusion in the March 2000 Annual 
Performance Report. Instances in which data is not available will be 
reflected in the Annual Performance Report accompanied by an 
explanation supporting the reason data is unavailable and anticipated 
time frames to obtain the data. However, prior to preparation of the 
March 2000 Annual Performance Report, FSA will diligently strive to 
develop systems facilitating the collection and evaluation of all 
required data.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or targeted performance?
    Answer. The primary reason for requesting funding is to achieve 
expected or targeted performance, given certain assumptions. 
Uncertainties, however, in developing budget requests and later actual 
execution, include unexpected changes in the agricultural economy which 
have an impact on results. Given this reality, future funding requests 
will continue to reflect agency priorities with consideration given to 
performance in the prior year relative to expected or targeted 
performance. Although actual performance will be a factor in deciding 
on funding requests in future years, it is and will continue to be only 
one of many factors considered in determining appropriate funding 
levels.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Performance goals in the Agency's budgets are not 
reflective of the full costs of all associated activities performed in 
support of that goal. However, performance goals and program activities 
in the budget are linked to the four Agency goals in the annual 
performance plan, which are presented on a full cost basis. For 
example, each Agency goal, i.e. Farm Programs, includes the salaries 
and expenses needed to support that goal. Specific Agency performance 
goals in the annual performance plan are not reflective of the full 
costs. A basis for determining full cost at this level has not been 
developed.
                   Food Safety and Inspection Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The FSIS Pathogen Reduction/Hazard Analysis and Critical 
Control Point (HACCP) system regulation, finalized in 1996, is a 
scientifically based system designed to reduce pathogens on raw 
products. The regulation requires meat and poultry slaughter and 
processing plants to adopt a HACCP system of process controls to 
prevent chemical, physical, and biological food safety hazards. The 
regulation contains specific requirements for sanitation and 
microbiological testing. By the beginning of this year, 92 percent of 
all Federally inspected meat and poultry products have been produced 
under a HACCP system. The HACCP regulation is a fundamental shift in 
meat and poultry inspection from prescriptive oversight of the 
regulated industry to performance-based standards for that industry's 
products. As part of HACCP implementation, FSIS is rewriting its 
regulations to reflect this shift from prescriptive oversight to 
performance-based management. The Agency is also breaking new ground in 
establishing performance standards for pathogens. Product samples taken 
under the regulation for almonella and E. coli testing will also be 
under performance-based standards for the future. At this stage, the 
focus is on determining baselines and monitoring prevalence. Future 
baseline data gathering and performance-based pathogen testing are 
projected for Campylobacter and Listeria as well.
    Question. How are your agency's senior executive and other key 
managers being held accountable for achieving results?
    Answer. Senior Agency managers have traditionally been involved in 
developing an FSIS strategic planning process resulting in a strategic 
plan. To strengthen managers' accountability for achieving results of 
initiatives contained in the plan, in 1996 the Administrator 
established specific levels of performance for a performance rating of 
``outstanding'' and ``superior'' in senior executives' performance 
standards. Annual reviews of upper level managers include an evaluation 
of how well they have satisfied these agreed-upon performance levels.
    Question. How is performance information being used to manage the 
agency?
    Answer. Through the requirements of sanitation and pathogen testing 
contained in the HACCP regulation, the Agency is monitoring the degree 
of success of plant performance as indicated by performance-based data. 
Plant data generated in E. coli testing, for example, will provide 
trend analysis that will enable Agency managers to determine the 
appropriateness of critical control points in a plant's HACCP plan. 
Performance-based data provide objective monitoring of a plant's 
compliance with the regulatory requirements and permit the Agency to 
redirect resources to non-compliant plants as necessary. The 
Performance-Based Inspection System (PBIS) database is also useful in 
helping Agency managers in directing resources to those areas where the 
resources are most needed. The Agency believes that the HACCP system 
along with performance-based results from micro testing will improve 
food safety and reduce foodborne illness.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. The decisions about funding requests for the 2000 budget 
reflect support for priority areas of performance both within the 
Agency and in cooperative work with the Agency's State partners to 
improve food safety on a seamless national basis.
    The largest single funding increase is requested for mandatory pay 
raises estimated at $21.3 million, which are essential to maintaining 
inspection coverage nationwide. Without this increase, FSIS would have 
to reduce staffing--primarily in the inspection workforce--and this 
would compromise our ability to perform our statutory mission of food 
safety inspection oversight.
    The program initiatives included in the budget request target key 
performance areas to meet the anticipated challenges of new program 
demands. Once HACCP is implemented in all inspected establishments, 
FSIS must be able to transition its workforce to perform the redefined 
regulatory tasks and procedures required by the HACCP final rule. The 
requested increase of $10.8 million will effect the proposed salary 
upgrades, redeployment, and recruitment to develop a more highly 
skilled, better educated, and more versatile workforce that will enable 
FSIS to maximize the performance of its inspection workforce.
    To strengthen the food safety partnership with the States, $2.9 
million is requested through the President's Food Safety Initiative. 
This highlights the increasing importance of our cooperative work with 
States in performing our food safety mission with both State 
Departments of Health and Agriculture in outbreak and recall 
investigations and in the Cooperative State Inspection Program.
    An additional increase of $1.0 million is requested to carry out 
Department-mandated civil rights training and to improve Agency civil 
rights programs. This request reflects the importance of civil rights 
in our food safety performance day in and day out throughout every area 
of FSIS, from the most remote establishment to headquarters program 
offices.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. The Agency underwent an organizational restructuring as it 
went about implementing HACCP in 1996. FSIS restructured from a region-
area-circuit organization to districts which would provide more 
comprehensive service to its customers and improve communications 
between the field and headquarters.
    FSIS involved all stakeholders and constituencies from the outset 
to gain valuable information about the Pathogen Reduction/HACCP 
regulation, a core component of the Agency's goal. Through more than 
100 public meetings to date, the Agency has sought public comment on 
its policies and future direction, resulting in changes in the HACCP 
regulation and, ultimately, in program changes for HACCP 
implementation.
    Question. Could you describe the process used to link your 
performance goals to your budget activities? What difficulties, if any, 
did you encounter and how did you solve them?
    Answer. The Agency recognized the importance early on of linking 
the performance goals and the budget activities through the Agency 
mission. The goals represent Agency mission objectives, while the 
budget activities represent mission activities. On a preliminary basis, 
the Agency evaluated the relationship between the budget activities and 
the performance goals to determine whether or not changes were needed 
in budget activities, and found that the complementary linkage of 
performance goals and budget activities to the Agency mission indicated 
no immediate need for change.
    FSIS is undergoing a transformation in its inspection program from 
traditional organoleptic inspection to HACCP-based inspection. The 
performance goals are specific to achieving a reduction in foodborne 
illness through HACCP and other inspection changes, and primarily focus 
on new and anticipated food safety developments. The budget activities 
capture all costs for both the traditional inspection program and the 
new HACCP-based inspection system now being implemented. The linkage of 
performance goals and budget activities will evolve through many stages 
as transformation of the inspection program takes place, but the Agency 
does not anticipate any further changes in its budget activities at 
this time.
    Question. To what extent does your performance planning structure 
differ from the account and activity structure in your budget 
justification? Do you plan to propose any changes to your account and/
or program activity structure for fiscal year 2000?
    Answer. The FSIS performance planning structure is built around 
specific steps that must be carried out to achieve the strategic goal 
of minimizing foodborne illness in meat, poultry, and egg products. The 
account and activity structure used in the budget submission is 
organized along program activity lines that capture the range of 
infrastructure and support activities necessary to build a total 
inspection program.
    At this point in time, it is too early to discuss with any 
certainty the likelihood of changes to the account structure. The 
proposed program activity structure is broad and flexible enough to 
permit linkage with strategic and annual performance goals, especially 
as these are fine-tuned or change over time.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. During the performance measure design process, FSIS created 
measures that would utilize information that is both available and 
reliable. The Agency does not anticipate performance-reporting 
difficulties in preparing the March 2000 report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The Agency's performance measures are designed to measure 
performance in areas where performance has never been measured before. 
This is clearly a learning period for the Agency and adjustments will 
be made as lessons are learned.
    FSIS has established performance measures that it believes relate 
to each performance goal in question. That is, the measures used 
correlate directly to the targeted performance. However, the Agency 
believes that it needs more experience before it is able to confidently 
predict future budget requirements based on projected performance.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Full program cost is captured in the six budgetary Program 
Activities (Federal Food Inspection, Import/Export Inspection, 
Laboratory Services, Field Automation and Information Management 
(FAIM), Grants-to-States, and Special Assistance for State Programs) 
which encompass all activities of the Agency's meat, poultry, and egg 
inspection mission. The dollar amounts associated with the performance 
goals reflect the full Agency cost in carrying out those goals, 
including overhead.
        Grain Inspection, Packers and Stockyards Administration
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. Beginning with fiscal year 1999, each of the agency's 
senior managers will be evaluated on how well they perform in two new 
areas, best business practices and outreach. Senior managers will be 
expected to identify and use best business practices to deliver quality 
service to American agriculture. They must demonstrate innovative and 
creative thinking to promote good business that achieves the agency's 
mission while being sensitive to customer concerns. Senior managers 
must also foster an understanding of the agency's mission, goals, and 
objectives and demonstrate empathy for customers' concerns. The end 
result is that each senior executive's performance will be directly 
linked to the agency's performance and to our customers' needs--both of 
which are key aspects of performance-based management.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The agency's senior executives are held accountable for 
achieving results. As part of the performance review process, the 
agency's senior executives are evaluated on their key accomplishments 
for the fiscal year. Furthermore, all senior executives are evaluated 
on how well they take affirmative steps to support, promote, and carry 
out Administration and Department policy, of which the GPRA is a key 
component.
    Question. How is performance information being used to manage the 
agency?
    Answer. The following examples indicate how performance information 
is being used to manage the agency's programs. GIPSA plans to increase 
the time devoted to analyzing issues involving competitive practices, 
financial protection, and trade practices to ensure a fair, open, and 
competitive marketplace for livestock, meat, and poultry. Timely 
resolution of investigative issues is critical to marketplace 
efficiency. The percentage of investigative issues resolved in a year's 
time is a critical measure of program performance. The agency, will, 
therefore, strive to increase the percentage of investigative issues 
resolved within the span of one year with an overall improvement in 
marketplace efficiency.
    Faster resolution of issues will also result in an increase in the 
amount of money recovered for the benefit of livestock producers 
suffering economic losses in the marketplace. Using fiscal year 1998 as 
the established baseline, GIPSA will continually monitor loss recovery 
and focus on those issues having the greatest impact on the producer.
    GIPSA has also implemented an enhanced quality assurance and 
quality control program to ensure the quality and accuracy of 
inspection results nationwide. The program includes a balance of 
national and localized monitoring. A greater emphasis is placed on 
proactive actions to prevent problems from occurring rather than 
reacting to problems once they have occurred. Results from the quality 
assurance and quality control program provide the data to monitor the 
statistical accuracy of original inspection results and the statistical 
accuracy of Official Agency inspection results-two key performance 
indicators.
    In the near future, GIPSA will complete a telecommunications 
network that will allow electronic mail and daily data sharing between 
all offices within the official inspection and weighing system. Among 
other things, the network will allow GIPSA to create a national grain 
quality database that will have many uses, such as providing a dynamic 
picture of nationwide grain trends and allowing timely responses to 
potential problem areas. The database will also allow GIPSA to monitor 
and measure the consistency of grain inspection results--something in 
which our customers have a keen interest.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Program performance factored directly into decisions about 
the agency's funding requests for fiscal year 2000. As provided in the 
agency's annual performance plan, GIPSA recognizes that a funding level 
less than that requested for fiscal year 2000 would restrict the 
agency's ability to meet its goals, objectives, and performance 
measures for the Packers and Stockyards Programs. Available resources 
would be focused on conducting investigations involving competitive 
issues and on those issues having the greatest financial impact on the 
industry. Reduced funding would result in fewer investigations and 
could expand the time frame to complete investigations.
    The agency also provided an explanation in its budget request and 
performance plan for fiscal year 2000 of why additional funding is 
needed for mycotoxin detection, varietal identification, and the study 
of future market needs. All three relate directly to the agency's 
ability to provide the technology to measure grain quality and quantity 
so that the market has ready access to reliable information which, in 
turn, reduces market risk and increases market efficiency.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. GIPSA's ability to achieve Goal 1 of its strategic and 
annual plans is improved by the Agency's recent restructuring of the 
Packers and Stockyards Programs. The restructuring has strengthened 
GIPSA's capability to investigate possible unfair and anticompetitive 
practices and provides greater flexibility and efficiency in enforcing 
the trade practice and payment protection provisions of the Packers and 
Stockyards Act. Additional economic, statistical, and legal expertise 
have been added to the field offices, thereby increasing the efficiency 
and effectiveness of the Packers and Stockyards staff in investigating 
anticompetitive practices. The larger field offices will give GIPSA the 
critical mass of personnel needed to address complex anticompetitive 
issues.
    As indicated in a previous response, GIPSA has also implemented an 
enhanced quality assurance and quality control program to ensure the 
quality and accuracy of inspection results nationwide. Results from the 
quality assurance and quality control program provide the data to 
monitor the statistical accuracy of original inspection results and the 
statistical accuracy of Official Agency inspection results--two key 
performance indicators.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. Each of the agency's budget activities, the Packers and 
Stockyards Programs and the Grain Program, is directly linked to a 
strategic goal and supporting performance goals and indicators. The 
Packers and Stockyards Programs are represented in Goal 1 of the 
agency's strategic and annual plans, and the Grain Program is 
represented in Goal 2. The end result is that the agency's budget 
structure directly links resource amounts to goals.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No changes are needed at this time.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. The agency may not have data for one of the performance 
indicators supporting Objective 2.3. As given in the agency performance 
plan for fiscal year 2000, the agency projects that that the percentage 
of satisfied customers will increase to 88.5 percent in fiscal year 
1999. The agency's ability to measure levels of customer satisfaction 
is dependent upon approval by the Office of Management and Budget to 
conduct customer surveys.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The agency's senior managers compare actual and expected 
performance as they prepare their funding requests. Such comparison is 
an integral part of the budgeting process.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. There is a direct linkage between the agency's strategic 
goals and the agency's two program areas, the Packers and Stockyards 
Programs and the Grain Program. The goals, in turn, are directly linked 
to the agency's budget activities. The end result is that the dollars 
associated with specific goals reflect the full cost of all associated 
activities performed in support of that goal.
                National Agricultural Statistics Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. NASS has taken a number of measures to promote performance-
based management. One major tool is the internal NASS Action Plan, 
developed from the Agency's GPRA Strategic Plan, which provides 
employees with a more detailed blueprint for achievement of the NASS 
goals and objectives. This document contains internal performance 
targets, strategies, and measures which were developed at the 
grassroots level by NASS employees. The NASS Action Plan also includes 
the specific performance measures reported in the Agency's Annual 
Performance Plan.
    To help measure the success of management initiatives, an 
organizational climate survey of NASS employees is taken every 2 years, 
and the results shared with all employees. Following the most recent 
climate survey, the Administrator of NASS appointed an employee 
committee to study the survey results and make specific recommendations 
to NASS senior managers on areas identified as needing improvement. In 
addition, a tailored organizational climate survey was administered to 
NASS computer analysts to provide useful information for an April 1999 
data processing workshop attended by key data processing staff. The 
status of all NASS initiatives and accompanying performance measures 
are frequently included on the agenda for senior and middle manager 
workshops, meetings, and conferences.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The responsibility for reporting the needed data for the 
performance measures reside within the individual NASS work units. 
These measures are updated in the Agency's Action Plan, available to 
all employees. NASS's senior executive decisionmaking body, the 
Strategic Planning Council, reviews specific performance measures in 
semi-annual meetings and requests more information from individual 
units, as needed. The senior executives' performance standards include 
elements related to providing leadership in establishing and 
implementing program goals and objectives, and managing the human, 
financial, and property resources effectively and efficiently to 
accomplish program goals.
    Question. How is performance information being used to manage the 
agency?
    Answer. NASS performance measures represent a mix of internal 
measures, such as organizational climate survey results and measures of 
the accuracy and timeliness of reports, and external measures, such as 
customers' assessments of the usefulness and importance of NASS data. 
Managers utilize this information to help them determine how to 
allocate resources and shift priorities, modify procedures, develop new 
products, and perform strategic planning.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Customer feedback is a critical part of NASS's annual 
performance plan. The NASS fiscal year 2000 budget request includes 
initiatives to expand NASS's environmental work, such as the collection 
of additional pesticide use data. This is in direct response to 
requests from customers, stakeholders, and partners who are pleased 
with the current NASS chemical use data set, but want more information 
about certain commodities and sectors of agriculture not covered in the 
current program. NASS has worked extensively with customers and 
stakeholders to receive input into the prioritization of commodities 
without usage data, review States involved in the program, and to 
discuss the use of commodity rotation in NASS pesticide use data 
collection plans. In 1997, NASS implemented an annual postharvest 
pesticide use survey to address levels of pesticide residues on 
specific commodities that are treated following harvest. To date, four 
commodities have been surveyed: apples, potatoes, corn, and wheat. 
Plans for 1999 are to collect postharvest application data on soybeans 
and oats.
    NASS's involvement in Puerto Rico for the census of agriculture 
program was directly responsible for the formulation of a budget 
initiative for fiscal year 2000. Because USDA is now responsible for 
conducting the census of agriculture in Puerto Rico, the Puerto Rico 
Department of Agriculture, for the first time, had a lead coordination 
role in the conduct of the 1997 Census of Agriculture. It became 
obvious after successfully working together on this census that the 
same cooperation on other agricultural statistics programs would be 
very beneficial to both parties. This prompted a request from the 
Secretary of the Puerto Rico Department of Agriculture to establish a 
NASS office in Puerto Rico which ultimately resulted in the budget 
initiative included in the fiscal year 2000 budget request for NASS.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. NASS has made measurable progress in increasing the percent 
of total national agricultural production included in the NASS annual 
program, which is a key performance measure in both the GPRA strategic 
plan and the annual performance plan. This has been accomplished by 
providing agricultural statistics for the equine and aquaculture 
sectors and expanded data for the nursery and greenhouse industries.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The Annual Performance Plan links the budget and 
performance goals by showing the Agency's funding and FTE's allocated 
by the five Research, Education, and Economics (REE) Mission Area 
general goals. The last page of the NASS Annual Performance Plan 
includes a Resource Table matrix displaying the three NASS program 
activities according to the REE goals.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. NASS does not anticipate any needed changes at this time. 
NASS's present budget accounting structure cross-walked with the REE 
general goals allows for the development of meaningful performance 
indicators and resource allocations.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. No. NASS anticipates having performance data available for 
each measure in time for the first performance report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The improved accuracy afforded by actual performance data 
versus estimated information will allow better decisions to be made 
regarding Agency program changes, new initiative requests, reallocation 
of resources, and targeting of areas needing improvement.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Yes, overhead costs are fully reflected since the total 
NASS budget is divided among the five general goals.
                       National Appeals Division
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The National Appeals Division (NAD) has one mission and 
that is to conduct evidentiary administrative appeal hearings and 
reviews arising from program operations of assigned agencies. NAD has 
one goal: Conduct timely hearings and issue timely and well reasoned 
determinations which correctly apply laws and regulations. NAD has 
developed performance-based measures using statutory and regulatory 
requirements. These measures include: timeliness of appeal hearings; 
timeliness for issuing appeal hearing determinations; timeliness for 
issuing appeal review determinations; and percent of hearing officer 
determinations upheld on review. NAD has implemented NADTrack, a 
management information system, which tracks data for these performance 
measures. NADTrack data is used to measure and refine priorities while 
ensuring that NAD is maximizing its resources.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. NADTrack data will be reported on a quarterly basis to key 
managers. Reports will be in a standardized format, and will use data 
from the GPRA-based NADTrack Subsystem. The report will conform with 
the Strategic Plan, Annual Performance Plan and the Annual Performance 
Report. These Quarterly Performance Evaluations will be the product of 
NAD's internal analysis. The performance goals and indicators for these 
objectives have been identified by the key managers.
    Question. How is performance information being used to manage the 
agency?
    Answer. NAD uses its NADTrack system to determine whether 
performance meets stated goals and objectives. This information is used 
to ensure organizational efficiency and effectiveness are achieved. 
Performance information from NADTrack, budget formulation, and other 
management tools are used to: identify strategies for allocating 
resources, design customized training, prioritize performance 
objectives, and (4) measure results of management decisions.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. In the fiscal year 2000 request, NAD asked for additional 
money to fund a customized training program. This increase in training 
funds was based upon a review of NAD performance factors.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. In fiscal year 1999, NADTrack evolved into a system which 
uses consistent and reliable data to maintain and update statistics. 
All performance information is measured using identical statistical 
methodologies.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. NAD's budget structure directly links resource amounts to 
program goals. The entire appropriation is assigned to a single 
performance goal.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No changes are needed at this time.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are likely 
available in time for the first performance report in March 2000? If 
so, what steps are planned to improve the reliability of these 
measures?
    Answer. The agency's fiscal year 2000 Results Act performance plan 
does not include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. Actual performance will be compared to the expected 
performance and budget request adjustments made as required. 
Adjustments, when required, will be made using current resources to the 
maximum extent possible.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Because of NAD's single mission, all costs are assigned to 
its single performance goal.
                 Natural Resources Conservation Service
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. First, I have ensured that there is a clear focus on 
performance-based management at the highest level. I realigned the 
headquarters structure, consolidating responsibility for strategic 
planning, performance planning and measurement, budget allocation, and 
oversight and evaluation under a Deputy Chief for Strategic Planning 
and Accountability. I directed the new Deputy Chief to develop and 
implement a new accountability system that would provide a balanced, 
reliable, and timely picture of the agency's performance. The system 
will enable agency managers to estimate the effect of programs on the 
condition of natural resources systems, assess the cost-effectiveness 
of service delivery, identify opportunities for process improvement, 
and respond to customers' needs with strategies and assistance tailored 
to local conditions.
    Second, I have taken action to ensure that reliable high-quality 
information is available to achieve performance based management within 
NRCS. In fiscal year 1999, we have begun implementation of the new 
accountability system, which includes data in three major categories.
    The system provides detailed data on how we spend our time. The 
Time and Attendance Report each employee submits every 2 weeks will 
report the hours spent for each of 27 programs or initiatives 
(Watershed Surveys and Planning, Grazing Lands Conservation Initiative, 
etc.) and for each of nine major activities (providing assistance in 
developing conservation plans, conducting resource inventories, etc.). 
The system was further enhanced in fiscal year 1999 to include a web-
based report database that summarizes NRCS program and activity hours.
    The system also provides data on the annual workload and long-term 
conservation needs of NRCS and the conservation partnership in each 
field office area. We have developed procedures to conduct nationally 
consistent analyses of our workload. An initial workload assessment was 
completed October 1, 1998. It identifies conservation needs based on 
local knowledge and goals, natural resources information from NRCS 
inventories, and information from other sources. The analysis develops 
estimates of the time, by technical discipline, required to produce the 
agency's core work products.
    The system also provides complete and consistent data on a limited 
number of key performance measures. We have identified key measures 
that are adequate indicators of annual progress toward strategic goals. 
These indicators are conservation practices and systems that are 
defined in NRCS field office technical guides. Basic demographic data 
necessary to ensure programs are delivered fairly and equitably will be 
reported for all services delivered. In addition to the conservation 
practices and systems, which are indicators of outcomes, the new system 
will collect data on selected output and input indicators, including 
program management items (such as number and acres in contracts, etc.), 
on resource inventory and technology development, and on other NRCS 
state and national office outputs.
    The performance reporting system is being developed and implemented 
in phases. The first phase, essentially completed in fiscal year 1998, 
permits collection of data on performance measures that are easily 
quantifiable activities, such as acres on which erosion control 
practices were applied. Beginning in October 1998, a sample of field 
offices began entering data. Other offices will be added to the system 
later in the year. Throughout this transition year, the effectiveness 
of the system will be evaluated and needed adjustments made.
    Third, I have strengthened management of performance evaluation and 
oversight activities. On October 1, 1999, Oversight and Evaluation 
Staffs were realigned to the Operations Management and Oversight 
Division, under the Deputy Chief for Strategic Planning and 
Accountability, to conduct oversight activities to ensure that NRCS 
employees comply with all laws, regulations, and agency policies and 
procedures and evaluations to improve the quality and delivery of 
services.
    Finally, I have taken action to ensure that funding is linked to 
performance. New procedures are being implemented to define performance 
expectations when budgets are allocated to managers.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Agency-wide goals for key performance measures are set in 
the agency performance plan, based on the long-term goals in the 
strategic plan. In addition, goals for program-specific activities or 
outputs are established. As the performance measurement system becomes 
fully operational, specific state goals will be established for each 
performance measure. An appropriate element will be included in state 
and regional conservationists' individual performance appraisals. The 
Regional Conservationists will monitor the progress of states for which 
they are responsible and hold state conservationists accountable for 
meeting goals. The Deputy Chief for Strategic Planning and 
Accountability will monitor performance nationally and report to the 
Associate Chief, who will hold Deputy Chiefs and Regional 
Conservationists accountable.
    Question. How is performance information being used to manage the 
agency?
    Answer. Measurable long-term outcome strategic objectives that 
support the agency's mission are established in the strategic plan. 
Annual performance goals are set to move toward achievement of the 
strategic goals and objectives. Line managers will be assigned 
responsibility for specific portions of each agency goal when they 
receive their allocation for a fiscal year. They will develop operating 
budgets that use their funds and staff to meet the established goals 
and conduct all activities needed to achieve the goals. Employees will 
report their accomplishments on key performance measures on a 
continuous basis and will report how their time was spent, by program 
and major activity. Data will be available on a real-time basis so that 
employees and first-line supervisors can monitor progress. Senior 
managers will review performance and financial data periodically to 
ensure efficient and effective use of resources and to take corrective 
action when necessary.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. fiscal year 1998 and fiscal year 1999 are transitional 
years in our use of performance information. In fiscal year 1998, we 
determined that the level of quality of performance data reported 
through the existing reporting system was not adequate to meet GPRA 
requirements and could not be improved to the necessary degree at an 
acceptable cost in field staff time. The systems then in use required 
so much time that they actually hampered achievement of service 
delivery goals. Therefore, we suspended use of the reporting system 
then in use and began development of a new system that would provide 
more consistent reporting of key measures with less burden on the field 
staff. Fiscal year 1998 performance data for many of the cross-cutting 
measures of natural resources improvement were, therefore, not 
available for use in developing fiscal year 2000 budget requests. 
However, program output data was available and was considered in 
formulating the budget requests. In addition, historical performance 
data was also available and was considered where appropriate.
    For example, the 1996 Act set an acreage goal of 975,000 acres to 
be enrolled in the program by the end of 2002. Actual acreage enrolled 
through the end of fiscal year 1998 was 665,447 acres. The fiscal year 
1999 budget supports a goal of 120,000 acres. For the fiscal year 2000 
budget, program manager's information was used to determine that a goal 
of 199,826 acres was achievable, which would bring the total enrolled 
to the fiscal year 2002 goal. The program manager's information on cost 
of enrollment was used to establish a request to support the goal.
    In formulating the request for the Environmental Quality Incentives 
Program, several kinds of performance-related data were considered. 
Program performance data, including program participation, the extent 
of the resource concerns to be addressed, and the special needs of 
historically underserved customers were considered. Because addressing 
concerns about potential problems associated with animal feeding 
operations was identified as a major goal of the program, data on the 
level of historical performance and the time and cost required for 
completing waste management systems was used to estimate the level of 
performance that could be anticipated with various levels of funding.
    With the new Performance and Results Measurement System, output and 
outcome performance data will be used much more extensively in the 
future.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. We have made the changes in the headquarters management 
structure and in our management information systems described earlier.
    In addition, we have established a team to analyze field office 
operations and identify internally-imposed requirements and procedures 
that add little value and reduce the time that front line staff can 
devote to direct services to customers. We are implementing the team's 
recommendations, thus allowing employees to focus more attention on 
directly serving customers and completing high priority conservation 
work.
    We are developing plans to ensure that all agency personnel 
maintain the level of technical expertise essential to meeting goals. 
An interdisciplinary team conducted a review of how we deliver 
appropriate conservation technology to field personnel and made 
recommendations for improvement, which we are implementing. A separate 
review of training for the field offices has resulted in a 
comprehensive catalog of training, including self-paced, satellite, 
agency-provided formal coursework, and non-agency training available. 
The review made further recommendations for improving technical 
training. The Technical Guide Committee is continuing to update 
conservation practice standards. All practice standards are available 
on the World Wide Web so that all technical staff have immediate access 
to current technology. We will also shortly begin a focused effort to 
develop the Field Office Technical Guide of the Future.
    And of course we are continuing to work with the other Service 
Center agencies in the ongoing business reengineering process to reduce 
duplicative administrative tasks and free up the field to work with 
customers.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance goals established in the agency performance 
plan are cross-cutting goals that are supported by multiple activities 
in the budget structure. The performance goals provide a way for 
managers and the public to see the outcome on the landscape that 
results from the agency's services that are funded through separate 
accounts. This comprehensive view of agency performance is not possible 
when performance is measured program-by-program.
    The agency performance plans for fiscal year 1999 and fiscal year 
2000 include a summary table that quantifies the relationship between 
each program and resource objective in the agency strategic plan. For 
programs that support multiple objectives, however, allocation among 
objectives is only estimated. The combined data that will be available 
from the new time and attendance reporting system and performance 
measurement system and the workload analysis activity will provide 
information for planning and will be the basis for allocation of funds 
to outcomes, enabling managers to ensure that funds and time are 
expended on the objectives that were intended.
    In addition to the cross-cutting goals, each program in the budget 
structure continues to set program-specific goals for activities and 
outputs that must be achieved in order to achieve the higher-level 
performance measures.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. We are not yet prepared to propose changes to our account 
and activity structure. As more detailed information becomes available 
through our new performance reporting systems, we will conduct analyses 
to evaluate the benefits and identify unintended consequences of 
changes in the budget structure.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. We expect to have available data that are reliable at the 
national level for the key natural resources outcome-related 
performance measures in the revised fiscal year 1999 performance plan 
that was included in our fiscal year 2000 plan.
    The new reporting systems include built-in edit checks to provide a 
first level data validation function and help ensure the accuracy of 
the data. Internal reviews are conducted to ensure that activities meet 
all applicable program, technical, and quality standards and are 
properly recorded. Additional data validation/verification plans are 
being developed to ensure data are nationally consistent and 
comparable.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. When our accountability system is fully implemented, we 
will have more detailed information on results achieved and the time 
required to achieve them, by geographic area. We will be able to more 
accurately estimate expected performance at alternative levels of 
funding than was possible with information available earlier, which 
generally supported only generalized national estimates. We will be 
able to identify the causes of any shortfall in expected performance 
and to determine corrective action needed. We will hold managers 
accountable for performance goals. Where reliable information 
demonstrates that performance shortfalls result from insufficient 
resources directed to a problem, we will provide the Congress with a 
firm basis for making its decisions on future funding.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The fiscal year 1999 and fiscal year 2000 performance plans 
include a summary table that attempts to allocate all agency funds 
among the natural resources objectives established in the strategic 
plan, thereby indicating the full costs associated with the objective. 
Our time and financial systems in the past have not been designed to 
track costs by resource outcome. Therefore, at present we can only 
estimate full costs of objectives.
    Our new time reporting system is designed to provide detailed 
information of the time actually spent in supporting each program's 
activities and the time spent in certain major activities, such as 
conservation planning or application. Data from the time reporting 
system and the financial systems will feed the Actual Cost Recovery and 
Evaluation System (ACRES), which will provide data on direct, indirect, 
and full cost of programs and of the work activities in the time 
reporting system.
    We made program time the focus of the initial phase in implementing 
our new time reporting system because time funded through the 
Conservation Technical Assistance (CTA) account is used to assist 
planning, and to a lesser degree, application, of conservation systems 
that are implemented with cost-share funds from some other source. 
Oversight entities and the Congress have expressed interest in having a 
clearer view of this interaction between programs. While program and 
activity data will be adequate to explain the use of funds for 
programs, such as the Wetlands Reserve Program, that primarily address 
a single resource goal, it may not permit us to track all costs 
associated with all resource outcomes for programs such as CTA that 
address multiple goals. Further refinement of the workload analysis 
effort may be needed in some cases to allocate time to specific natural 
resources goals rather than to work activities. A team has been 
established to complete an analysis and develop needed mechanisms to 
fully integrate the elements of the accountability system.
                 Office of Budget and Program Analysis
    Question. What specific steps have you taken as the head of the 
agency to achieve performance based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. Employee performance standards for OBPA staff establish the 
job performance requirements that have to be met in order to accomplish 
the performance goals specified in OBPA's Strategic Plan and Annual 
Performance Plan.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Accountability for achieving results is ongoing based on 
the nature of the work the office carries out on a day-to-day basis 
throughout the year. In addition, senior executives performance ratings 
are based on whether the desired level of performance is achieved based 
on feedback from Departmental policy officials.
    Question. How is performance information being used to manage the 
agency?
    Answer. Managers and staff are aware of what they are expected to 
accomplish based on their annual individual performance standards and 
elements. During the year, this performance is closely monitored and 
remedial actions are taken as necessary to enhance performance.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. It has become apparent that the desired level of program 
performance is becoming increasingly difficult to maintain as staff 
resources have decreased and program and budget complexity has 
increased. To meet these needs the OBPA budget requests increases for 
an additional staff year, as well as funds to replace the office's 
outdated information technology system. It is expected that these 
increased resources will allow the office to maintain and enhance its 
performance.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
plan?
    Answer. OBPA has not found it necessary to make any program 
changes. The goals we have set out in our GPRA documents are those we 
would strive to achieve whether or not there is a requirement to 
formally acknowledge such efforts.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The OBPA budget structure consists of a single 
appropriation for the office. That appropriation encompasses all of the 
performance goals based on staff and other resources dedicated to 
accomplishing the goals.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No changes are needed.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance for which reliable data are expected to be 
available in time for the first performance report in March 2000.
    Answer. We expect reliable data to be available in time for the 
2000 performance report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. If expected performance is not achieved we will try to 
determine the causes for reduced performance and tailor budget 
requests, as appropriate. As mentioned previously, the fiscal year 2000 
budget request includes increases necessary to achievement of the 
performance goals. In addition, we will look for opportunities for 
improved performance within existing resources.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal. For example, are overhead 
costs fully allocated to the goals?
    Answer. All costs are fully allocated to the goals.
                        Office of Communications
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. I asked the Office of Communications'--OC--management team 
to refine the focus of our Performance Plan. During that process we 
acknowledged that as a communications support agency, our only goal is 
to enhance and assist in accomplishing the Department's three goals; 
expand economic and trade opportunities for agricultural producers an 
other rural residents; ensure food for the hungry, and a safe, 
affordable, nutritious and accessible food supply; and promote sensible 
management of our natural resources. To fully assure our success in 
meeting OC's goal, we reviewed and added to our means and strategies 
section. OC managers contributed to this revision so they understand 
the linkage of our plan to their performance and to the staff. Managers 
will rank their employees' performance according to their 
accomplishment of means and strategies and in recognition of their 
contributions toward achieving our goal. We have realigned and 
strengthened our performance plan to assure that OC provides high 
quality and timely support that will contribute significantly toward 
USDA meeting its goals.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Weekly reports are used by these managers, the Director and 
Deputy Director of OC to monitor the agency'sperformance. In the case 
of specific information initiatives, special meetings will be held to 
assess OC's performance in meeting those initiatives. Also, the 
Director and Deputy Director evaluate and measure the performance of 
OC's senior executives and key managers on an annual basis. The 
individual performance plans for senior executives and other key 
managers used in this process include performance elements that are 
tied to OC's means and strategies for accomplishing its performance 
goal.
    Question. How is performance information being used to manage the 
agency?
    Answer. OC uses feedback from the media and the public to evaluate 
our performance. Positive or negative performance indicators will be 
used in evaluating individual performance. Work accountability will 
also be measured by weekly activity and management reports. Remedies 
and additional actions will be established should performance fall 
below the plan.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. The Office of Communications' staff level has been reduced 
by more than 20 per cent since 1993. During this time, little or no 
funds have been appropriated to expand communications activities, 
improve OC's information technology, or to measure USDA and OC 
performance in achieving stated communications goals and objectives. 
The increases proposed in the fiscal year 2000 budget will be used to 
add technological enhancements that allow measurement of communications 
performance (e.g., Internet counters or feedback on use of radio and TV 
products); train OC staff in the use of the latest technologies; 
effectively and efficiently provide information to under served client 
populations; and to obtain a limited amount of consulting assistance to 
gain specialized skills not currently available. Our requested funding 
for fiscal year 2000 is directly related to our annual performance 
plan.
     The proposed budget includes $588,000 in fiscal year 2000 for OC 
to upgrade its technology and provide staff the training necessary to 
make use of advances in communications products, technologies, and 
techniques so that all segments of the American public may take full 
advantage of USDA programs, initiatives, services and data. For 
example, upgraded capabilities would include making teleconferences, 
publications, and radio and television recordingsprepared for media use 
directly available to the general public via the Internet. This will 
dramatically transform the general public's access to USDA materials. 
Products which were previously available only through the media outlets 
at specified times or were available to a limited number of 
participants, will be available at the public's convenience and in a 
form that will allow for more effective use. Members of the public can 
save materials on their own home computers, making them available for 
not only current, but future reference. USDA staff around the country 
as well as the public can access teleconferences on a variety of topics 
such as, informational programs, policy discussions, technical 
guidance, and training. If the requested funds are not provided, OC 
will not be able to take full advantage of these technological 
advances, which will restrict OC's ability to provide information in 
the most effective, timely and cost-efficient manner.
    The proposed budget also includes $70,000 in fiscal year 2000 for 
OC to improve communications efforts to reach groups working with 
citizens in under served communities and geographic areas. Funds will 
be used to design, produce, distribute and analyze under served client 
population surveys and fund audio and video teleconferences with target 
populations and organizations.
    The proposed budget also includes $201,000 in fiscal year 2000 for 
OC to cover the increased cost of critical Department-level 
communications coordination and dissemination. Through thisfunding, OC 
will use available communications products, technology and techniques 
that reach all segments of the American public, regarding food supply 
concerns raised by Year 2000 compliance by the agricultural industry. 
OC will use radio and television special programs and the printed media 
to alert the consumer that food supplies will be delivered as regularly 
scheduled.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. The Office of Communications does not manage programs, but 
rather supports the programs of the Department's agencies, therefore 
there are no changes to report. However, OC continually modifies its 
performance based on internal assessments, weekly staff meetings and 
feedback from USDA agencies and other customers. In the fiscal year 
2000 budget request OC proposes to enhance its evaluation mechanisms 
and upgrade the technology usedto disseminate information to the 
public.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. OC's budget structure is a single line item that fully 
supports its one performance goal.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No change is needed to the OC account and activity 
structure in the budget justification to improve this linkage.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. The fiscal year 2000 budget request includes a request for 
additional funding to expand or enhance the evaluation mechanisms used. 
If the requested funding is not provided, OC will use existing feedback 
and evaluation techniques. If the Electronic Access initiative is not 
funded, this will seriously jeopardize OC's ability to achieve its goal 
of expanded and enhanced support of USDA's performance goals.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. Office of Communications will meet its targeted performance 
if it receives the additional funds appropriated from the fiscal year 
2000 budget request. The Office of Communications has not received a 
budget increase in the last three years, which required absorbing pay 
raises and increased operating expenses.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Since OC has only one performance goal, all of its funding 
resources, including overhead costs are devoted to this goal.
                     Office of the Chief Economist
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. Strategic and performance goals have been developed to 
achieve performance-based management within the Office of the Chief 
Economist--OCE. As head of the agency, I worked with the managers to 
identify achievable goals and indicators for measuring and validating 
OCE accomplishment. Throughout this process, I have emphasized to all 
OCE personnel that annual performance appraisals will be based on 
achievement of plan criteria.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Senior executives and other key managers are being held 
accountable for achieving results by the fact that their performance 
ratings and eligibility for bonuses depend on accomplishment of plan 
goals and indicators. Their degree of success in achieving these goals 
and indicators is related to the degree to which they achieve the 
target quantitative and qualitative indicators specified in the 
strategic and performance plans.
    Question. How is performance information being used to manage the 
agency?
    Answer. The managers of each element have been made aware of the 
specific goals which they are responsible for accomplishing. As 
managers provide feedback based on preliminary indicators, progress is 
monitored and, if necessary, remedial steps are initiated to ensure 
accomplishment of their assigned goals.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. OCE provides analysis and information critical for 
effective Department program performance. Examples are: OCE provides 
crop and weather information that is essential for accomplishment of 
USDA Strategic Plan Goal 1: Expand Economics and Trade Opportunities 
for Agricultural Producers and Other Rural Residents. OCE requested 
funding for an initiative to modernize weather and climate data 
requisition in fiscal year 2000 to provide the Secretary and other 
stakeholders with timely, objective, and accurate information and 
analyses required to accomplish this Strategic Goal. This initiative 
was required to mitigate data gaps caused by the National Weather 
Service's decision to redefine its mission and by USDA's need to 
operate a modern world meteorological service.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. OCE has not found it necessary to significantly modify its 
program to achieve the goals established in its strategic and 
performance plans. However, OCE has implemented a variety of program 
adjustments to better achieve goals. For example, OCE received 
increased funding in fiscal year 1999 to improve food safety risk 
assessment in support of the President's Food Safety Initiative. OCE 
also organized coordination activities for USDA efforts in the area of 
global climate change and small farms.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The agency budget is designed to prioritize limited 
resources consistent with GPRA goals. Budget requests and FTE levels 
are linked to specific performance goals.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. There is no need for changes in the account and activity 
structure to improve this linkage.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely available in time for the first performance report in March 
2000? If so, what steps are planned to improve the reliability of these 
measures?
    Answer. OCE's fiscal year 2000 Results Act Performance Plan 
includes performance measures for which reliable data are expected to 
be available in time for the first performance report in March 2000.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. OCE assumes that actual performance will achieve targeted 
performance levels unless externalities present obstacles that cannot 
be overcome. OCE makes this assumption because its strategic and 
performance goals are compatible with the program activity structure 
contained in the President's Budget. Because the strategic plan covers 
a five-year period, OCE recognizes the possibility that changes or 
modifications in its activities may occur, especially, if funding 
levels are insufficient or support from other agencies is inadequate.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. All costs are fully allocated to the goals of OCE. On a 
goal by goal basis, costs are allocated in direct proportion to the 
number of FTEs required to achieve performance results.
                 Office of the Chief Financial Officer
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. During the year I have served as Chief Financial Officer, I 
have undertaken a major revision of our strategic plan that reevaluated 
who we are, who we serve, and what definitions others would apply to 
us. I have emphasized that while compliance with regulations and 
standards make for good business practices, we are here to provide a 
more productive work environment that results in cost savings and 
access to better financial information for decision making purposes.
    Individual performance plans of OCFO managers and employees are 
linked to and measured against the performance goals contained in our 
strategic and annual performance plans.
    To institutionalize performance-based management, my Directors 
participated in developing the fiscal year 1999 and fiscal year 2000 
annual performance plans and determining the objectives and measures 
that would indicate success in meeting those objectives. In 
coordination with agency contacts and plans, the Directors determined 
the Department-wide financial management goals USDA must achieve to 
provide the financial information that USDA decision-makers need to 
overcome long standing deficiencies in financial management.
    Much of OCFO's efforts are currently directed at the modification 
or creation of processes that will enable establishment of performance 
information (i.e., baselines, targets). These processes include, but 
are not limited to, implementation of cost accounting systems, audit 
tracking systems, and integrated financial information systems, and 
customer satisfaction levels. Accomplishment of these activities is 
necessary to monitor Department-wide progress and conduct performance-
based management activities. To some extent, implementation activities 
to modify or create these processes are serving as interim measures.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Each Division Director develops an annual operating plan 
that supports the annual performance plan. The annual operating plan 
lays out the specifics of what their division intends to accomplish for 
the year. This serves as a performance contract that is used in their 
individual performance ratings. Accountability is determined based on 
the level of performance achieved in line with their plan.
    Question. How is performance information being used to manage the 
agency?
    Answer. We are taking advantage of all available information in 
managing the Officethis includes time keeping data on hours of effort 
spent on projects and activities that relate to the Annual Performance 
Plan, as well as special reports on progress for those larger items 
such as the Foundation Financial Information System--FFIS 
implementation. We are tracking the available data on our Department-
wide goals, e.g., audit closure statistics, corrections of internal 
control weaknesses, and progress toward achieving an unqualified 
opinion of financial statements.
    As stated earlier, there are weekly reports and periodic retreats 
where information is used to assess where we are and what steps are 
needed for mid-course correction.
    Another source of performance information is the USDA Office of 
Inspector General and the General Accounting Office. These two 
organizations give us continual feedback information regarding our 
performance in the area of Departmental leadership for financial 
management via a host of audits, management alerts, and reports.
    Also, our staff is in touch with the Congressional staff and the 
GAO GPRA plan evaluators, collecting information and using it to focus 
our performance management activities.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. As part of our fiscal year 2000 Budget and Program 
development process, we recognized deficiencies brought to our 
attention by GAO (e.g., Major Management Challenges and Programs Risks, 
Performance and Accountability Series), our Inspector General, OMB and 
the central guidance agencies. The major areas of these deficiencies 
included financial management, systems, and reporting timeliness.
    In order to overcome these deficiencies OCFO has analyzed these 
deficiencies and determined that additional resources of $2 million and 
14 staff years are necessary to accomplish the following: (1) releasing 
financial statements on time, (2) correcting the material deficiencies 
cited in the recent report of the Inspector General on the Audit of the 
1997 Consolidated Financial Statement, (3) adequately implementing 
Congressionally mandated debt collection provisions, (4) properly 
implementing a financial information architecture that fully complies 
with Federal requirements, (5) maintaining guidelines for cost 
distribution processes to include guidelines for establishment of fees, 
(6) assuring compliance with the Single Audit Act and nonprocurement 
debarment and suspension/drug-free workplace requirements, (7) 
participating as a key player in Government-wide efforts to continually 
define and refine financial information requirements, (8) complying 
with new reporting requirements such as the accountability report, (9) 
developing and retaining a level of financial management expertise in 
the USDA agencies that ensures effective use of financial management 
information, (10) conducting oversight and guidance of USDA agencies 
GPRA planning and reporting requirements.
    These planned accomplishments are reflected in the performance 
goals contained in our annual performance plans.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Our biggest program change was the restructuring of the 
Foundation Financial Information System (FFIS) project, which was 
undertaken in response to an independent evaluation of that project. 
FFIS is the cornerstone of our efforts to implement over the next five 
years the integrated financial management mandated for each federal 
agency by the CFO Act. With the Secretary's support and guidance, we 
obtained a waiver from the Office of Personnel Management to bring an 
experienced project management team from another Federal agency that 
had successfully implemented a central financial system similar to what 
we are using at USDA.
    Question. How does the agency budget structure link resources to 
performance goals?
    Answer. The appropriated budget structure for OCFO is a single line 
item. There is a table showing by fiscal year the resources needed to 
accomplish each strategic goal in terms of source of funding, e.g, 
Appropriated, Working Capital Fund, and reimbursements. The sum of 
resources by type of fund needed to meet the strategic goals is shown 
in tables at the end of the fiscal year 1999 and fiscal year 2000 
annual performance plans.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. No change is needed to the OCFO account and activity 
structure in the budget justifications.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. Our performance goals are based on information we either 
have available or will have available for the performance report. The 
verification and validation process will tell us whether or not 
performance targets for fiscal year 1999 were reached.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The development of future budgets will assess the 
priorities and cost of achieving the performance elements identified in 
the Performance Plan. As a result of the assessment, unproductive or 
extremely inefficient program objectives will be de-emphasized in favor 
of more critical and more productive program elements. Experience with 
the performance measures will be used to determine whether or not a 
program/activity should be continued, and determine whether the OCFO 
operating plan for the program/activity is efficient and producing the 
desired outcomes.
    Question. To what extent do the dollars associated with specific 
performance goals reflect the full costs of all associated activities 
performed in support of that goal? For example, are overhead costs 
fully allocated to goals?
    Answer. The OCFO appropriated overhead costs are fully allocated 
among Strategic Goals 1 and 2 in the Annual Performance Plans. Goal 3 
includes our WCF funded activities which operate on a full cost 
recovery basis with overhead built into the fee for service charged to 
our customers.
                  Office of Chief Information Officer
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within you agency, as 
required by the Government Performance and Results Act?
    Answer. During the fiscal year 2000 budget development process, 
OCIO staff made certain that all increases were aligned with the 
Strategic plan and with the Annual Performance Plan. OCIO developed 
specific performance measures for each increase requested in an effort 
to track the progress of OCIO program objectives. Project Management 
with specific measures and milestones will be instituted in the way 
OCIO manages its work in the coming fiscal year.
    In November 1998 and April 1999 the OCIO management team met to 
track our progress; look at lessons learned; and develop a tactical 
plan (in November 1998) to meet our mission. A full session of the 
meeting was devoted to determining ``How OCIO Measured up to its 1999 
Annual Performance Plan.'' Findings from the session were that OCIO is 
on track to meeting its performance goals for fiscal year 1999.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. OCIO has recently established a procedure for having senior 
executives and key managers quarterly apprise the CIO and Deputy CIO 
(DCIO) of progress towards achieving the fiscal year performance goals. 
Individual accountability of managers is defined by means of individual 
performance standards. Formal performance evaluations take place once a 
year.
    Question. How is performance information being used to manage the 
agency?
    Answer. OCIO utilizes performance information as a tool for 
measuring program success. The CIO and DCIO also review these 
indicators to determine if in fact they are based on outcomes. If the 
performance measure does not yield the intended goal, it is changed to 
measure the intended goal.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. During the fiscal year 2000 budget development process, 
OCIO staff made certain that all increases were aligned with the 
Strategic plan and with the Annual Performance Plan. OCIO developed 
specific performance measures for each increase requested in an effort 
to track the progress of OCIO program objectives. See the example 
below:
Performance Goals and indicators
    Establish USDA policy on IT management using the Capital Planning 
and Investment Control methodology:
    Number of USDA agencies using CPIC in the selection, evaluation, 
and control of their IT investment portfolio fiscal year 1997, n/a; 
fiscal year 1998, 5; fiscal year 1999, 10; and fiscal year 2000, 20.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Strategic tactical planning was instituted in fiscal year 
1998 to help improve performance and meet the goals established in the 
strategic and annual plans.
    Question. How does the agency budget structure link resources to 
performance goals?
    Answer. OCIO directly links its budget resources to performance 
goals. During the fiscal year 2000 budget development process, OCIO 
staff made certain that all increases were aligned with the Strategic 
plan and with the Annual Performance Plan. OCIO developed specific 
performance measures for each increase requested in an effort to track 
the progress of OCIO program objectives.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. We do not consider changes to be necessary at this time.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. OCIO expects that its measures will supply reliable 
information for the first report. OCIO performance measures will be 
improved with each iteration of its tactical plan.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. The fiscal year 2001 and future budget processes will 
follow the previous year's budget development process which directly 
linked performance measures with increases and dollars in the base.
    Question. To what extent do the dollars associated with specific 
performance goals reflect the full costs of all associated activities 
performed in support of that goal? For example, are overhead costs 
fully allocated to goals?
    Answer. All costs associated for a program activity are fully 
realized in the OCIO performance goals, including overhead for support 
staff.
                     Office of the General Counsel
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. I welcome and act upon feedback from Subcabinet level 
officials on the success and timeliness of legal services provided as 
it relates to achieving the jointly established performance goals and 
objectives as required by the Government Performance and Results Act 
(GPRA). Where additional legal resources are required, I direct senior 
OGC managers to reallocate resources to properly reflect priorities set 
for the Department by the Secretary of Agriculture, Subcabinet level 
officials and agency heads.
    For example, a paramount issue that has required increased 
assistance and counsel is the issues of concentration in agriculture 
and the impact on producers. I have directed the reallocation of legal 
resources--a senior level official--to work directly with Subcabinet 
policy officials to evaluate, assess and address problems in this area.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. In addition to meetings with the senior OGC managers as 
issues arise, I meet with them collectively, on a weekly basis, to 
assess their progress in achieving the agency goal and objectives. 
Managers will be held accountable for achieving results through year 
end surveys conducted with agency officials which will reveal whether 
managers have done a good job in striving to meet the priority needs of 
agency officials. The results of these surveys will be discussed during 
yearly performance evaluations to inform, guide and direct management 
of the achievement of not only OGC's goal but of the success in 
assisting USDA officials in meeting their strategic goals.
    I also use the established Incentive Awards Program for managers 
that deserve special recognition for performance in the achievement of 
OGC's goal and objectives. I have sponsored and held management 
conference with senior management throughout the organization in order 
to be able to evaluate our performance in achieving agency goals.
    Question. How is performance information being used to manage the 
agency?
    Answer. Within OGC, the information gathered through meetings and 
consultation with Subcabinet and agency heads, will enable senior 
managers to better provide an understanding of priorities to agency 
attorneys. This in turn, will regulate the work flow and lessen, to 
some extent, the crisis mode of handling agency legal work. This 
performance information will also be used to provide managers with 
continuing feedback concerning the development of new issues that 
require substantial amounts of OGC input, so that resources can be 
effectively managed and/or reallocated.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000?
    Answer. The process of more carefully prioritizing demands for 
legal services is clearly required by the current budget environment. 
In this current budget climate, increases in staffing to meet constant 
or increasing work loads are unlikely to be forthcoming. Therefore, OGC 
must plan how resources will be allocated and agency officials must be 
educated to understand that legal resources are limited. The process 
envisioned by our performance plan will force managers in OGC to work 
and consult more closely with agency officials to determine priorities 
for legal services and determine whether or not OGC services were 
effective and responsive, taking into account established priorities. 
For example, If USDA officials indicate that OGC services were not 
effective and responsive, taking into account established priorities, 
then OGC will determine the reason for this. If additional resources 
are needed, then such information will be included in OGC's budget 
submission in order to achieve the goals and objectives set forth in 
our plan.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plan?
    Answer. One of the objectives was to create a Civil Rights unit 
within OGC. In achieving OGC's objective in a manner that supports the 
Secretary's policy objectives, we made a fundamental change within the 
agency's organization to transfer and request substantial legal 
resources to a newly created Civil Rights division. We have hired a 
cadre of experienced civil rights attorneys and support staff, to 
include a senior executive with a track record of achievement in Civil 
Rights to support the Department's Civil Rights program. We also have 
been successful in our efforts to promote workforce diversity by 
conducting an outreach program regarding employment opportunities to 
minority law students and the physically challenged. We have also 
improved the computer and communications systems in the office by 
upgrading OGC computers, providing OGC employees with Internet access 
and continuing with the implementation of the paradox work tracking 
system.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance goals articulated in the annual performance 
plan will be tied directly to the goal stated in our strategic plan. 
The goal centers around making OGC more responsive by ensuring that 
demands for legal services are prioritized in a manner consistent with 
the priorities of the Secretary.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage.
    Answer. Since the budget for OGC is requested via single line item 
in the President's budget, we do not anticipate any need to change or 
modify the account or activity structure to improve this linkage.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. We are in the process of developing an internal agency 
database which will be used to track OGC's performance measures.
    Question. How will future funding requests take into consideration 
actual performance compared to expected target performance?
    Answer. The assumption underlying the OGC strategic plan are based 
on a recognition that staffing levels within OGC are unlikely to change 
significantly over the next five years. Therefore, the focus of the 
plan will be to ensure that OGC prioritizes its work in a manner which 
properly reflects the priorities of the Secretary of Agriculture, the 
Under and Assistant Secretaries and Agency Heads. Should funding be 
provided at a level that is less than requested, OGC would be unable to 
meet its objective of providing effective legal services in a 
responsive manner.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The fully allocated costs of providing legal services have 
been distributed to OGC's performance goals.
                    Office of the Inspector General
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. We have developed the strategic and annual plans required 
by the Act and identified the mission and performance goals, 
objectives, and performance indicators to foster performance-based 
management within OIG. We have initiated revisions to our management 
information system to capture the data needed to measure our progress, 
and we continually stress the need to achieve our performance goals to 
our managers.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    The agency's executives and managers are being held accountable 
through an ongoing assessment of the results produced. Senior 
executives and other key managers are evaluated based on the measurable 
activities results of the personnel. Executives and managers are 
directing the efforts of the agency towards areas that can maximize our 
efforts and are evaluated accordingly.
    Question. How is performance information being used to manage the 
agency?
    Answer. We are using performance information to enable us to gain 
insight into the adequacy of our internal policies and procedures and 
to compare quantitative and qualitative results with our initial 
benchmarks. As mentioned above, the agency tracks a wide range of data 
on the audits and investigations conducted and results achieved by its 
staff. This computerized management information system is the backbone 
of program management. Performance information is being used to 
identify areas in which our methods need to be changed and to assess 
the effectiveness of these changes.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Program performance and all other aspects of the agency's 
operations and needs are routinely considered as decisions are made 
regarding the agency's funding requests. Our special Presidential law 
enforcement initiative identified as Operation Talon exemplifies this 
effort. Under Operation Talon, the agency has worked with local law 
enforcement and social service agencies to identify fugitive felons who 
are receiving Government benefits from the Department's programs. It 
has been highly successful nationwide providing outstanding results in 
identifying these fugitive felons and removing them from the benefit 
roles. It has been so successful it was announced by the Vice President 
in December 1997 at a high profile media event which also touted 
cooperation between Federal, State, and local Governments. These 
results helped support our decision to seek additional funding to 
enhance our law enforcement efforts under our goal of promoting program 
integrity in the Department's programs by detecting fraud, waste, and 
abuse in these programs.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. We have intensified our planning efforts by seeking input 
from agency management personnel and gathering information from other 
sources, such as consultations with the Congress and through the media 
to identify those areas that require a more intensive focus. We 
continuously evaluate, and changes are made to the workload, staffing 
assignments, etc., to improve performance. We also perform research to 
familiarize ourselves with any changes that may have occurred in USDA 
agencies and mission areas during each year and prepare profiles 
detailing the changes and their impact. The profile information is used 
to prepare strategies that define those areas where OIG resources can 
best be applied to help ensure that the Department's programs are more 
efficient, effective, and better protected against fraud, waste, and 
abuse.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. All of the agency's appropriated funding is allocated to 
its performance goals which are linked to the agency's budget 
structure.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. None.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. Audit and Investigations' performance data are expected to 
be available for the performance evaluation and will be available in 
time for the first performance report.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. As more information is available--and its accuracy and 
reliability assessed--on how the agency's goals actually reflect its 
operations, costs, and results, these will be made part of the agency's 
decisionmaking process in determining future funding requests, as well 
as other activities of the agency's day-to-day operations.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. The agency's performance goals reflect the full costs of 
each goal including a pro rata portion of all associated overhead or 
other related costs.
                           Rural Development
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. The development and implementation of performance-based 
management is an ongoing process. We expect managers to use the 
strategic plan as a guiding management tool. In addition to the 
development of annual performance plans at the agency-level, as 
required by the Results Act, Rural Development State Directors are 
required to develop annual performance plans for their States, 
including measurable performance targets. Agency Administrators 
annually issue their ``Administrator's Priority Performance Goals'' 
which detail performance targets by program to be achieved at the 
state-level. These performance targets, directly and indirectly, 
support the performance measures used in the annual performance plans. 
State Directors' annual performance appraisals reflect their success in 
attaining these performance targets and implementing their annual 
plans.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. The annual performance appraisal for senior executives and 
State Directors now includes an evaluation of their success in meeting 
specific program performance targets.
    Question. How is performance information being used to manage the 
agency?
    Answer. The performance indicators in the Annual Performance Plans, 
along with other measures and forms of information, are used by senior 
management in the day-to-day management of the agencies. For example, 
to maximize its limited resources and increase the amount of funds 
available for rural development, leveraging is a key objective in the 
mission area's strategic plan. Rural Development agencies have strongly 
pushed their employees and customers to find ways to leverage their 
funds with private and public partners. Each of the Annual Performance 
Plans include performance measures tracking the Agency's leveraging 
activity for most of their programs.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. Funding requests for Rural Development programs are based 
on many factors, especially need, which is essentially determined by 
requests for funding. For loan and grant programs the performance 
measures in the Annual Performance Plan are tied directly to the level 
of funding provided for each program. For example, the strong need for 
clean drinking water in rural areas, as defined through the President's 
Water 2000 Initiative, has resulted in an increase in the President's 
request for Water and Waste Loan funds from $730 million in fiscal year 
1999 to $900 million for fiscal year 2000. This results in an increase 
in the performance measurement ``rural people served who did not 
previously have public water service'' from 539,000 people served in 
fiscal year 1999 to an estimate of 648,000 people served in fiscal year 
2000.
    Likewise, the unmet demand for Business Programs and the 
performance of loans in recent years were considered in fiscal year 
2000 funding request decisions. In the Intermediary Loan Program, a 
large unmet need (approximately $41.4 million) due to a lack of funds 
existed at the end of the fiscal year 1998. This level of unmet need 
continued in fiscal year 1999 and is anticipated to continue in fiscal 
year 2000. Because of this a significant increase in program level 
funding, from $33 million in fiscal year 1999 to $52.5 in fiscal year 
2000, is being requested by the President. This increase will result in 
an increase in the Performance Measure ``number of jobs created or 
saved'' through the IRP from 25,250 in fiscal year 1999 to 40,170 in 
fiscal year 2000.
    Poverty among rural seniors is staggering. The Economic Research 
Service reports 42 percent of rural seniors, over the age of 74, are at 
or below 150 percent of the poverty rate. A majority of these seniors 
are women and own their own homes. The Section 504 Home Repair loan and 
grant programs help low-income senior citizens eliminate health and 
safety problems in their homes. The average income of a Section 504 
recipient is $12,400 and fifty percent of all participants earn less 
than $8,710 each year. All recipients of Section 504 grants are very 
low-income elderly people, and 67 percent of them are single women 
(usually widows). More than half of the Section 504 loan recipients are 
senior citizens. The President's proposal to increase the Section 504 
loan and grant programs, from $55 million in fiscal year 1999 to $62 
million in fiscal year 2000, will result in an increase in the ``number 
of existing houses improved'' for low income rural senior citizens from 
8200 homes in fiscal year 1999 to over 11,200 homes in fiscal year 
2000.
    The Farm Labor Housing loan and grant programs received increases 
from $33.5 million in the fiscal year 1999 budget to $40 million in the 
President's fiscal year 2000 budget. This increase was in recognition 
that the programs reach a population, namely farmworkers, that is 
underserved not only by USDA but also by the rest of the Federal 
Government. The USDA Farm Labor Housing programs are the only Federal 
programs dedicated to farm worker housing and these programs are among 
the few programmatic opportunities USDA has to serve farmworkers, since 
farmworkers typically do not participate in food assistance programs 
such as WIC or food stamps. The Secretary committed to increasing the 
funding for these programs as part of his civil rights initiative. The 
proposed funding increases will result in an increase in the ``number 
of Section 514/516 units built'' for farmworkers from 495 units in 
fiscal year 1999 to over 600 units in fiscal year 2000.
    The Community Facilities direct and guaranteed loan programs, plus 
the grant program, allow communities to provide basic services that 
will enhance the quality of life of the residents. Community Facilities 
programs can be used to address a panoply of rural community needs, 
ranging from child care centers to job training centers to teacher 
housing. Ninety percent of the recipients of Community Facilities 
direct loans receive loans at ``poverty'' or ``intermediate'' interest 
rates, which are significantly below market rates, because the 
communities cannot afford to repay the debt at the full interest rate. 
The President proposed an increase in the Community Facilities programs 
from $387 million in fiscal year 1999 to $473 in fiscal year 2000. This 
increase is reflected in a number of performance measures in the Rural 
Housing Service's Annual Performance Plan. Several of these measures 
are: an increase in the ``number of new or improved health care 
facilities'' in rural areas, from 136 in fiscal year 1999 to 165 in 
fiscal year 2000; an increase in the ``number of beds available at new 
or improved elder care facilities'' from nearly 2200 in fiscal year 
1999 to over 2650 in fiscal year 2000; and an increase in the ``number 
of children served by new or improved child care centers'' from 
approximately 6100 in fiscal year 1999 to approximately 7400 in fiscal 
year 2000.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. Rural Development has made several program changes to 
improve performance and performance measurement. For example, the Rural 
Utilities Service observed that the existing eligibility and 
application scoring criteria for its Distance Learning and Telemedicine 
program were impeding its ability to meet its goals for targeting of 
funds to the neediest applicants. The criteria was changed to eliminate 
the problem. The Rural Business-Cooperative Service observed that its 
information management system did not track certain information to 
monitor goal accomplishments. While the automated system is being 
enhanced, a manual reporting system was designed so the State Offices 
can report their accomplishments on goals to the National Office on a 
quarterly basis.
    The Rural Housing Service recognized the need to increase its 
leveraging activity in order to implement the mission area strategic 
plan and to increase the funding available for rental housing in rural 
communities. In fiscal year 1999 the Agency changed its regulations to 
begin awarding Farm Labor Housing and Section 515 Rural Rental Housing 
funds through nationwide competitions and to give preference to 
leveraged applications. The Farm Labor Housing competition has not been 
completed but the Section 515 process is done. By giving priority to 
leveraged applications, the Rural Housing Service was able to leverage 
its $79 million for new construction by more than 75 percent. This 
excellent precedent sends a signal to Section 515 applicants that they 
must leverage in order to receive funding from the Agency and it will 
hopefully elicit an even higher level of matching funds in the future.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. Rural Development established one strategic plan which 
supports the three agencies constituting the mission area. The Rural 
Development Strategic Plan contains a mission statement which 
encompasses the role of the entire mission area and three Goals, one 
for each agency. It also contains four broad Management Initiatives 
which support the entire mission area. By having a Goal for each 
agency, alignment with the existing budget structure, which is agency 
and program based, is achieved. Separate Annual Performance Plans for 
each agency facilitate reconciliation with the budget request over the 
entire mission area. The Goals in the mission area Annual Performance 
Plan, which align with the Objectives in the strategic Plan, are 
supported by one or more quantifiable performance measures to be 
achieved during the fiscal year.
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. Rural Development does not need any changes to the account 
and activity structure to support the Results Act. Individual agency 
performance plans focus on the major programs that account for the bulk 
of the mission area's funding.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. We have established performance measures in the annual 
performance plans that support the goals in the strategic plan and have 
given priority to the development of measures which could be verified 
in future performance reports. These measures are largely based and 
drawn from our existing automated data systems, which are mainly 
financial systems and are audited annually by the Office of the 
Inspector General. The quality of these data are generally good but, 
since they are primarily financially-based, may not be as outcome-
oriented as some might like. These measures are indicative of the types 
of data used in the day-to-day management of the agency. While we 
believe having results-oriented data, which would measure the impact of 
the program on the customer, would be useful, it is also difficult to 
define and would require the development of new data and systems. No 
resources are now available to support new systems development for 
Results Act reporting purposes. Until additional resources become 
available, we will continue to rely on existing information systems for 
monitoring accomplishments.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. Funding requests for loan and grant programs are primarily 
needs-driven while the performance measures are primarily a function of 
the amount of funds provided for the program. Programs that perform 
exceptionally well on measures of greatest priority, such as their 
capability to serve those rural Americans most in need, will be 
considered for increases. However, given the Administration's desire to 
stay within budget targets, it is unlikely that any programs will 
receive significant increases.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full costs of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. Rural Development's comprehensive program delivery 
structure, which provides services across all of rural America, is not 
conducive to explicitly identifying and associating all overhead costs 
directly with individual performance activities. Rural Development 
staff and support resources are generally commingled in the delivery of 
mission area programs. Field staff provide housing, business, 
cooperative, water and waste, and community facilities program 
services. Administrative service activities support all of the program 
areas. It would not be useful or meaningful to attempt to allocate 
costs at too fine a level. Overhead costs are fully allocated to the 
goals, but only at the macro level.
                         Risk Management Agency
    Question. What specific steps have you taken as the head of the 
agency to achieve performance-based management within your agency, as 
required by the Government Performance and Results Act?
    Answer. In January of this year, the Risk Management Agency (RMA) 
initiated a series of quarterly executive meetings for the purpose of 
discussing and improving Agency performance. At the first meeting, six 
macro performance measures were identified: 1) loss ratio, 2) market 
information, 3) financial audit, 4) public awareness, 5) program 
integrity, and 6) administrative costs. These measures were developed 
in consultation with the private insurance sector.
    At the second meeting, these macro-level indicators were merged 
into our operational strategy. From this strategy, numeric micro-level 
performance standards will be developed.
    Question. How are your agency's senior executives and other key 
managers being held accountable for achieving results?
    Answer. Each of our senior executives have performance elements in 
their standards that relate to the performance measures established in 
compliance with the GPRA. Data will not be available this year to judge 
the performance of all of these measures. Thus, executives will be 
judged by their having completed initiation of a process to obtain and 
evaluate these measures.
    For example, farmers' awareness of risk management methods is one 
performance measure. RMA has included questions to assess this 
awareness in upcoming farmer surveys. The results of this survey, 
however, will not be available in this rating period.
    Question. How is performance information being used to manage the 
agency?
    Answer. Many of the performance measures are relatively new and 
baselines are still being established. In addition, the performance of 
an insurance program is typically measured over a period of years due 
to the statistical basis of an insurance program.
    The major divisions within RMA have been assigned macro-level 
performance measures. For example, Research and Development has been 
assigned responsibility for the loss ratio. Loss ratio measures the 
amount of indemnities paid per premium received and is set by statute 
to be 1.075 with a reasonable reserve. Compliance with this standard is 
measured over a period of years. RMA is working with an actuarial 
consulting firm to determine if the means used to set premiums, which 
directly affects the loss ratio, are adequate. If the loss ratio is 
routinely exceeded, premium rates will be adjusted to compensate.
    Similarly, Insurance Services has been assigned to monitor market 
indicators such as the market share and penetration for various risk 
management products. A marketing plan is being developed to establish 
the baseline for these measures as well as to determine means to 
improve them. The summary of business reports and related analyses will 
be used to determine which insurance products are most frequently used. 
Maintenance on remaining products will be dropped so that scarce 
resources can be used elsewhere.
    These are two examples of how performance measures are used to 
adjust the course of the agency.
    Question. How did program performance factor into decisions about 
funding requests for fiscal year 2000? Please provide examples.
    Answer. When the fiscal year 2000 President's Budget was announced 
earlier this year, USDA presented specific ideas for strengthening the 
farm safety net. These ideas emerged as a result of the farm crisis in 
1998. Farm income fell precipitously, commodity prices plummeted as 
world markets softened, and other farmers struggled with the effect of 
natural disasters that hit many parts of the country. Neither the crop 
insurance program nor the 1996 farm bill were able to ameliorate the 
dramatic losses the farm economy suffered. As a result, weaknesses in 
the program were exposed. For example, we learned that our program is 
unable to provide adequate levels of protection to producers suffering 
multiple years of loss. Too many farmers remain uninsured or under-
insured. Many crops and commodities, like livestock, do not have 
federally-backed insurance available to them, and farmers have far too 
little instruction on the risk management tools and strategies that can 
protect and improve their farm revenue.
    In response to these concerns, USDA offered the following 
preliminary proposals: bring new, more flexible risk management tools 
to farmers; make the basic program more financially worthwhile by 
raising the floor on basic crop insurance coverage; increase incentives 
for farmers to purchase higher levels of coverage; cover multi-year 
disasters; cover livestock; make farmers in designated disaster areas 
eligible for NAP assistance once such a designation occurs; and provide 
better information and risk management education to farmers.
    Question. What specific program changes has the agency made to 
improve performance and achieve the goals established in the strategic 
and annual plans?
    Answer. In response to the farm crisis that exposed weaknesses in 
the crop insurance program, USDA has suggested the following proposals 
for change. These changes would allow RMA to achieve their goal 
established in its strategic and annual plans, ``To strengthen the 
safety net for agricultural producers through sound risk management 
programs and education.''
  --Raise the Coverage Floor.--Raise coverage to 60 percent of approved 
        yield indemnified at 70 percent of the expected market price, a 
        50 percent increase. Caution is needed to avoid raising buy-up 
        insurance too high thereby shifting production and potentially 
        depressing prices further. Caution is also needed to avoid 
        raising CAT coverage too high due to the potential buy-down 
        affect on current buy-up policy holders.
  --Make Higher-level Coverage More Affordable.--Increase the premium 
        subsidy so that coverage at 70 percent of the approved yield 
        indemnified at 100 percent of the expected market price level 
        (or 70/100) will cost the producer the same as 65/100 coverage 
        does today. Additionally, provide an additional premium subsidy 
        for coverage above the 70/100 level of 50 percent of the 
        additional premium, and make all insurance plans, including 
        revenue, equal in terms of assistance for premium. Review of 
        company expense reimbursements may be warranted in recognition 
        of the higher premium. The subsidy rate at these higher 
        coverage levels would be 55 percent.
  --Cover Multi-year Disasters.--Develop a new multi-year insurance 
        ``umbrella'' to complement single-year policies. Further, crop 
        insurance price elections and company expense payments would be 
        based on multi-year price averages, avoiding sharp inter-year 
        swings. In this context, RMA would also examine alternatives to 
        the current method of determining the yields used as the basis 
        for coverage.
  --Speed Flexible, New Risk Management Tools to Market.--Stimulate the 
        flow of new risk management tools to farmers by: (a) 
        authorizing RMA to reimburse companies for costs of successful 
        new products that they develop; (b) expanding contracting with 
        the private sector to develop products for smaller crops; (c) 
        reducing the regulatory procedures required to develop and 
        update policies; and (d) giving RMA greater flexibility to use 
        pilot projects, including pilot programs on a nationwide scale.
  --Cover Livestock.--Authorize RMA to pilot revenue-based livestock 
        insurance products proposed by the private sector. On an 
        initial basis, USDA proposed providing up to $50 million per 
        year from the Federal Crop Insurance Corporation (FCIC) Fund 
        for these products.
  --Improve the Noninsured Assistance Program (NAP).--Many farmers rely 
        on the NAP program as their primary protection from natural 
        disaster losses. Coverage should be increased to 60 percent of 
        yield and 70 percent of price, commensurate with the CAT 
        increase. In addition, the cost-effectiveness of the current 
        area trigger versus a Secretarial disaster designation should 
        be reviewed.
  --Provide Better Information and Services to Farmers.--As changes are 
        made to strengthen the crop insurance programs as part of the 
        farm safety net, it will also be important that farmer 
        awareness is increased so that producers can more quickly 
        access a wide range of both new and existing risk management 
        tools. Crop insurance reform should include a public awareness 
        outreach effort to enable producers to assume more 
        responsibility for greater understanding, and to better manage 
        their risk management planning portfolios.
    Question. How does the agency budget structure link resource 
amounts to performance goals?
    Answer. The performance measures specifically link resources to 
goals, as many of the goals are financially based. The Agency also uses 
the approach of establishing annual performance goals and indicators 
that gauge progress toward achieving the long-term general goal and 
objectives found in its strategic plan. As a result, all resources 
directly support the general goal of the Agency, ``To strengthen the 
safety net for agricultural producers through sound risk management 
programs and education.''
    Question. What, if any, changes to the account and activity 
structure in the budget justification are needed to improve this 
linkage?
    Answer. RMA feels no changes are necessary given the fact that we 
have established performance goals and indicators that gauge progress 
toward achieving the long-term general goal of the Agency.
    Question. Does the agency fiscal year 2000 Results Act performance 
plan include performance measures for which reliable data are not 
likely to be available in time for the first performance report in 
March 2000? If so, what steps are planned to improve the reliability of 
these measures?
    Answer. Yes. We envision difficulty in gauging farmers' use and 
knowledge of risk management tools. The following steps are being taken 
to try to improve the reliability of the measure: RMA is sponsoring 
some educational projects which include surveys on farmers' use and 
knowledge of risk management tools for certain regions of the U.S. 
However, sufficient funding for a comprehensive and reliable U.S. 
survey is not currently available. RMA is closely monitoring risk 
management educational opportunities of U.S. producers through regional 
activity logs. The extent of risk management education opportunities 
can be a proxy measure for knowledge of risk management tools.
    Question. How will future funding requests take into consideration 
actual performance compared to expected or target performance?
    Answer. RMA intends to monitor the crop insurance program and take 
into consideration the actual performance of the program when 
requesting future funding. For example, RMA will continue to evaluate 
and address program concerns such as: shortfalls of basic CAT coverage; 
low prices; multiple-year losses; revenue insurance participation; and 
lack of federally-backed livestock insurance. In addition, RMA will 
continue to analyze the number of acres which were actually insured, 
compare them to our fiscal year estimates, and revise as necessary. The 
number of policies in force, potential policies, premium cost per acre, 
and participation levels will also be evaluated and revised to reflect 
the most current data or trend. Furthermore, RMA intends on using the 
results of farmer surveys that gauge farmers' awareness of risk 
management methods, as well as regional activity logs, in determining 
future resource requirements of the Risk Management Education and 
Public Awareness/Outreach initiatives.
    There are some factors, however, that are more difficult to 
consider when comparing actual performance and target performance. For 
example, it would be nearly impossible to predict a loss ratio based on 
prior year actuals, due to occurrences such as unforeseen weather 
disasters. Compliance with this standard is generally measured over a 
period of years. As as result, the Agency uses the mandated loss ratio 
of 1.075 in projecting loss estimates. If, however, the loss ratio is 
routinely exceeded, premium rates will be adjusted to compensate.
    Question. To what extent do the dollars associated with specific 
agency performance goals reflect the full cost of all associated 
activities performed in support of that goal? For example, are overhead 
costs fully allocated to goals?
    Answer. All resources, including total Administrative and Operating 
(A&O) and Federal Crop Insurance Corporation (FCIC) Fund dollars, are 
linked to and directly support the general goal of the Agency, ``To 
strengthen the safety net for agricultural producers through sound risk 
management programs and education.''


AGRICULTURE, RURAL DEVELOPMENT, AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 2000

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [The following testimonies were received by the 
Subcommittee on Agriculture, Rural Development, and Related 
Agencies for inclusion in the record. The submitted materials 
relate to the fiscal year 2000 budget request for programs 
within the subcommittee's jurisdiction.]
               Prepared Statement of the Ad Hoc Coalition
    Mr. Chairman, Members of the Subcommittee, this statement is 
respectfully submitted for the hearing record on behalf of the ad hoc 
coalition \1\ supporting fiscal year 2000 appropriations for title I of 
Public Law 480 at not less than the same level as provided in the 
current fiscal year. The ad hoc coalition applauds the Administration's 
estimate that $91 million of CCC funds will be used to support Food for 
Progress in fiscal year 2000. The coalition also supports full funding 
for title II at not less than the same level as provided in the current 
fiscal year.
---------------------------------------------------------------------------
    \1\ The ad hoc coalition is composed of the USA Rice Federation, 
the National Association of Wheat Growers, the National Corn Growers 
Association, the National Council of Farmer Cooperatives, the American 
Soybean Association, the National Grain Sorghum Producers, the American 
Maritime Congress, the Maritime Institute for Research and Industrial 
Development, the Transportation Institute, TECO Transport Corporation, 
and Liberty Maritime Corporation.
---------------------------------------------------------------------------
    In its fiscal year 2000 budget, the Administration without 
explanation recommends a title I program level of only $150 million, a 
substantial decline from that established by the Congress for the 
current fiscal year. Our members also note with dismay that funding for 
title III, Public Law 480, has been zeroed out in the President's 
budget. This small program, which protects the poorest of the poor, 
should be restored at least to the $25 million level provided by 
Congress in the current fiscal year. At a time when U.S. agricultural 
prices are low, the Department should sustain these historic programs, 
with strong Congressional support, to alleviate hardships in friendly 
countries and promote new markets over the long term for our farmers.
                long-term significance of public law 480
    Mr. Chairman, the title I program has an illustrious history. From 
enactment in 1954 until the mid-1960s, title I shipments accounted for 
about 20 percent of the annual value of all agricultural exports. Until 
foreign sales dramatically increased in the 1970s, title I shipments 
continued to represent more than five percent of all agricultural 
exports. As recently as fiscal year 1990, moreover, title I export 
values regularly exceeded $700 million. Only in recent years has the 
U.S. commitment to this program eroded substantially, to a low of $202 
million in title I credit sales in fiscal year 1997.
    Under the leadership of your Subcommittee, Mr. Chairman, Congress 
in fiscal year 1998 reversed the severe decline in title I program 
funding. In that year, credit sales increased from $202 million to $252 
million, despite severe limitations imposed by the Congressional budget 
process. When the administration proposed again that the title I 
program level for fiscal year 1999 be sharply reduced, you responded by 
nearly doubling the funding requested for the program. Under severe 
budget constraints, the Agriculture Appropriations Subcommittees of the 
Congress have sustained title I when competing demands for resources 
have been most persistent.
    This year the wisdom of Congress' decision to preserve title I has 
been demonstrated for everyone to see. In the face of declining farm 
prices at home and serious economic dislocations abroad, the Clinton 
Administration has undertaken a Food Aid Initiative which includes an 
allocation of $726 million from the CCC to the title I program 
accounts. This will increase the program level for title I in fiscal 
year 1999 to $1,070,000,000, including $996 million in commodity 
credits and $104 million for ocean freight differential and ocean 
transportation costs.
    In fiscal year 1999, the title I program of Food for Peace was 
available to provide emergency assistance to the Russian Federation, 
and to provide additional markets for American agricultural products. 
This has happened before. It will happen again. The program must be 
preserved and sustained at reasonable levels to ensure its availability 
when adverse conditions recur at home or abroad. The great significance 
of title I in trying times has once again been shown; its long-term 
significance as a principal food aid and market-developing program 
cannot be forgotten.
    Mr. Chairman, the export subsidy reduction commitments established 
in conjunction with the Uruguay Round Agreement on Agriculture severely 
restrict U.S. flexibility in agriculture export market development. 
Those commitments curtail the use of the Export Enhancement Program and 
similar strategies that might be implemented in the future. But Food 
for Peace is exempt from the Uruguay Round restrictions: Public Law 480 
remains one of the principal programs for penetrating new overseas 
markets, for establishing trading relationships that will surely become 
essential to the economic survival of our agricultural sector.
                  outlook for u.s. agricultural trade
    In the two decades following World War II, Food for Peace was 
instrumental in securing long-term, stable markets for American food 
and fiber. In fiscal year 1996, U.S. agricultural exports reached a 
record value of $59.8 billion, representing more than 25 percent of 
total farm cash receipts for crops and livestock. In that year, the 
U.S. share of the global agricultural export market reached 23 percent, 
an increase of more than one-third in a single decade. But the record 
level achieved in fiscal year 1996 was no more than a snapshot of 
conditions at a given moment in time. Regrettably, conditions have only 
deteriorated since that banner year.
    Mr. Chairman, as the Department has reported, lower world market 
prices and export volumes reduced U.S. agricultural exports to $53.6 
billion in fiscal year 1998, a full ten percent below fiscal year 
1996's record high. In the current fiscal year, the Department expects 
the value of farm exports to decline to $49 billion. About 85 percent 
of the decline reflects reduced exports to Asia, but Brazil this year 
is also expected to reduce significantly its purchases from American 
farmers. This is particularly important to rice farmers, as Brazil in 
fiscal year 1998 accounted for one-fifth of total U.S. rice exports.
    The President's Food Aid Initiative will account for shipments of 
5.0 million metric tons of farm produce, an amount equal to all other 
U.S. food aid combined for the current fiscal year. This initiative has 
the strong support of the American agricultural sector, but it is not 
sustainable over the long term. As conditions at home and abroad return 
to normal, the United States once again will rely upon title I, Food 
for Peace, and other critical programs to maintain and expand export 
markets, and to create new markets in emerging economies throughout the 
world.
    The Foreign Agricultural Service of the U.S. Department of 
Agriculture, in administering Food for Peace, will be instrumental in 
protecting existing markets and developing potential new markets. 
Through sustained title I funding, Congress must give the Department 
the tools it needs to do the job.
            usda should be directed to use title i resources
    Mr. Chairman, the ad hoc coalition strongly recommends a fiscal 
year 2000 appropriation for title I of Public Law 480 at not less than 
the level provided in fiscal year 1999. Using carryover funding from 
prior fiscal years, increased levels for the baseline program can be 
achieved without diverting resources from other worthwhile programs of 
the Department.
    Mr. Chairman, the ad hoc coalition respectfully requests report 
language accompanying the fiscal year 2000 funding bills which would 
direct the Department of Agriculture to increase title I country 
allocations and make full use of the resources available for this 
worthwhile program. A strong and sustained title I program is the best 
insurance for Congress that the Department can promptly respond to 
future changes in the global agriculture export market and protect and 
develop new markets for our farmers.
                               conclusion
    Mr. Chairman, the administration has long acknowledged the 
importance of title I of Food for Peace as a program to promote long-
term markets for U.S. commodities, and to alleviate hardship in 
friendly countries. But the administration suggests a title I program 
level for fiscal year 2000 of only $150 million, a substantial decline 
from that established by Congress for the current fiscal year.
    With enactment of the 1996 Farm Bill, Government price supports and 
producer payments are being phased down. As a result, agricultural 
producers have become increasingly dependent on export markets to 
sustain a healthy economy. The title I, Public Law 480 program, coupled 
with the other export programs, have become of even greater 
significance than ever before in meeting this objective, sustaining the 
many allied industries dependent upon a healthy agricultural economy, 
as well as providing valuable humanitarian assistance to developing 
countries.
    The members of the ad hoc coalition respectfully request an 
appropriation of not less than last year's level for the title I 
program and committee report language directing the Department of 
Agriculture to establish a program level for the title I program that 
makes full use of this appropriation and the carryover funds. The need 
is there. We also request that the Agriculture Appropriations 
Subcommittees of Congress closely monitor the performance of the 
Department in fulfilling this objective over the course of the fiscal 
year.
    Our farmers and the U.S. maritime transport system depend upon 
Congress to set the standard, and upon the Department to meet that 
standard, as we enter an era of uncertainty and volatility in trading 
relationships. The title I program of Food for Peace must be preserved 
and effectively employed to promote American interests in an 
environment of uncertain markets and increasing global competition.
                                 ______
                                 
       Prepared Statement of the American Farm Bureau Federation
    The American Farm Bureau Federation has identified four USDA 
program areas for which adequate fiscal year 2000 funding is essential. 
They are:
  --programs key to the proper implementation of the Food Quality 
        Protection Act (FQPA),
  --funding for reform of the crop insurance program
  --programs to expand foreign markets for agriculture
  --funding for research to keep American agriculture competitive.
    These priorities are highlighted in the first portion of this 
statement. The second portion contains a list of additional programs 
supported by Farm Bureau.
                      food quality protection act
    Farm Bureau supports the Administration's request for $204 million 
for the Food Quality Protection Act (FQPA) and related programs. Farm 
Bureau supports $36 million for FQPA directly related programs, plus 
$127 million for integrated pest management research (IPM), $21 million 
for pesticide data collection and $20 million for pesticide 
registration, clearance, assessment and training
    We support full funding for the Pesticide Data Program (PDP). PDP 
provides valuable pesticide residue information to the Environmental 
Protection Agency (EPA) so that pesticide tolerance reassessment 
decisions can be made on actual residue levels rather than on 
theoretical maximums. Implementation of the FQPA must occur in a manner 
that does not harm production agriculture. This depends on the 
availability of accurate data on pesticide use and residues on crops.
    We support full funding for the Office of Pest Management. The 
Office of Pest Management should provide advocacy for farmers' 
continued access to safe and effective crop products and must be 
adequately funded to perform this important task.
    Key functions of the Office of Pest Management must include 
assisting EPA in establishing accurate data for risk assessments where 
current data is inaccurate or incomplete. This includes the development 
of crop profiles, which will be used by EPA in making risk assessments 
and tolerance decisions. USDA must be a full partner with EPA in all 
key implementation policy decisions. To reduce disruption of U.S. 
agricultural producers, USDA should conduct an economic impact analysis 
of proposed EPA implementation strategies, including EPA's proposals 
relating to risk assessments for the organophosphate and carbamate 
pesticides.
    We support full funding for the IR-4 Program, which provides data 
to EPA to clear new uses and tolerances for pesticides used on minor 
crops. Minor crops are likely to be impacted first by FQPA 
implementation. The IR-4 Program, if properly utilized, can provide 
data to support new, effective, economical and safe pesticide uses for 
crops impacted by FQPA.
                     crop insurance/risk management
    The federal crop insurance program must provide greater flexibility 
and more effective coverage for all agricultural commodities. 
Participation must be increased and the program should be expanded to 
include a comprehensive revenue insurance program to protect farmers 
from economic disasters due to weather or prices. The need for a short-
term emergency financial assistance package last year again pointed up 
the urgency for effective crop insurance and risk management programs.
    Reforms in risk management programs must assure broad-based 
availability and affordability for livestock as well as crops. 
Producers must have the opportunity to purchase coverage with small 
deductibles. These programs must also address multi-year disasters.
    We were disheartened that the Administration did not include 
additional money for crop insurance reform in its fiscal year 2000 
budget proposal after indicating earlier that it planned to submit a 
proposal. Several members of Congress have come forward with major 
reform plans that merit serious consideration. Depending on the 
assumptions used, most of the plans carry yearly costs beyond current 
funding levels of $1.5 billion to $2.5 billion per year. We recommend 
that a minimum of $2 billion per year in additional funding be 
earmarked for these programs.
                            export programs
    Continued funding of export development programs is fundamental to 
improving farm income, both in the short and long run. We recommend 
maximum funding of all export development programs consistent with our 
commitments under WTO trade rules.
    We support increased funding for the GSM credit program. We endorse 
the Administration's aggressive use of GSM 102, GSM 103 and supplier 
credit guarantee programs in fiscal year 1999, and back its plans to 
continue.
    We support increased funding for the Market Access Program (MAP) 
and the Export Enhancement Program (EEP). MAP funding should be 
restored to its original funding level of $200 million. We oppose 
efforts by the Administration to reduce the Export Enhancement Program 
program level by $85 million to $494 million. While we understand the 
administration's need to find budget offsets for other high priority 
spending, this reduction sends the wrong signal to other countries that 
subsidize exports, hurts our competitiveness overseas, and puts the 
United States at a disadvantage in the upcoming negotiations on 
agriculture in the World Trade Organization. We support funding for the 
Dairy Export Incentive Program to the full extent allowed under the 
Uruguay Round Agreement.
    We support increased funding for Public Law 480 programs, the 
primary means by which the United States provides foreign food 
assistance. We appreciate the Administration's aggressive use of $1.07 
billion in Public Law 480 Title 1 credit sales to move additional 
products into the export markets during fiscal year 1999. We do not 
agree with the recommendation to reduce use of the program to $150 
million.
    We support funding of APHIS Import/Export programs at $7.2 million 
to maintain current services and assist in reducing unfair trading 
practices. The Foreign Market Development Cooperator Program should be 
funded at no less than the current level.
                         agricultural research
    Agricultural research and the distribution of that research to 
producers is critical to the future of our industry. One of the 
implicit areas of agreement when the 1996 Farm Bill was enacted was 
that funding for agricultural research would be increased to allow U.S. 
producers to maintain their competitive position in world markets. To 
date this has not happened. In order to move the research agenda 
forward we support the following:
  --$120 million for the Initiative for Future Agriculture and Food 
        Systems authorized by the Agricultural Research, Extension, and 
        Education Reform Act of 1998.
  --$200 million for the National Research Initiative Competitive 
        Grants program. Originally authorized at $500 million annually, 
        the program has only been funded at $100 million to $120 
        million.
    We support enhanced funding for the Agricultural Research Service 
(ARS), with particular emphasis in the following areas:
  --an increase of $8.1 million for emerging diseases and exotic pests 
        of plants and animals. Care must be taken to assure that 
        animal, plant and aquaculture concerns are addressed.
  --an increase of $9 million for work in the area of plant and animal 
        genetic resources and the Agricultural Genome Project.
  --an increase of $11.7 million for work in food safety, to address 
        both pre-and post-harvest areas. This should include work on 
        manure handling, risk assessment and antibiotic resistance.
  --an increase of $2 million for Agricultural Information to develop 
        or enhance information systems delivery for rural America.
    We support adequate funding for ARS to transfer the National Swine 
Research Center at Ames, Iowa from Iowa State University to ARS and to 
fully staff the facility. Estimated needed funding for this would be 
$10 million per year.
    We support ARS funding of $8.2 million for general maintenance and 
modernization of the Plum Island Animal Disease Center.
    We support current ARS activities regarding honeybee research and 
strongly opposes plans to close the Tucson laboratory.
    The National Soil Tilth Lab at Ames, Iowa should be maintained at 
its current level of funding to continue work on soil, water, manure 
and nutrient management to improve the environment and farmers' ability 
to sustain profitable operations for the long term.
    We support CSREES funding of $4.8 million for Animal Health and 
Disease, Section 1433.
    We support CSREES requests for funding of the following special 
research grants:
  --$2.7 million for Integrated Pest Management and Biological Control
  --$600,000 for minor use animal drugs.
  --$2 million for the Bi-national Agricultural Research and 
        Development Fund (BARD).
Other Issues
    We oppose all efforts to reduce funding for APHIS-Wildlife 
Services. At minimum, Wildlife Services should be funded at last year's 
level for ``methods development'' and ``operations.'' Additional 
funding of $1.2 million should be made available for wildlife hazards 
at airports. Any unfunded Congressional directives should receive 
funding. APHIS-Veterinary Services should be funded so there is no loss 
of services.
    GIPSA should be funded so there is no loss of services and to 
provide for additional administrative oversight of the poultry 
industry. GIPSA should receive full funding to monitor business 
transactions between produces and packers
    For FDA, we support additional funding of $200,000 per year for the 
next five years for the Center for Veterinary Medicine to hire staff to 
reduce the backlog of animal drug applications.
    We support the Commission on 21st Century Production Agriculture 
and urge sufficient funding to ensure that the Commission will be able 
to conduct a thorough revaluation of the effectiveness of the FAIR Act 
and potential agricultural policy alternatives.
    We support efforts to provide loans to producers to build on farm 
grain storage facilities.
    We reject plans to cut funding to boll weevil eradication programs. 
We support full funding to provide a 30 percent match with producer 
funding and increased availability of low interest revolving loan funds 
to facilitate expansion of the program.
    We support increased funding for USDA guaranteed operating and 
ownership loans and streamlined administrative procedures to ensure 
that loans are made in a timely manner.
    We support funding of the Conservation Reserve Program to increase 
enrollment to the 36.4 million acres allowed under current law.
    We are concerned about adequate NRCS conservation operation 
funding. Conservation program delivery and technical assistance should 
be a priority for NRCS funding. No new initiatives should be funded in 
the conservation operations budget. Emphasis should be placed on 
traditional technical assistance and the development of reliable 
resource data for assisting producers deal with nutrient management. We 
support earmarked funding for technical assistance under the Grazing 
Lands Conservation Initiative.
    With regard to conservation programs under the Commodity Credit 
Corporation Program (CCC), we believe that emphasis should be placed on 
the Environmental Quality Incentive Program (EQIP). EQIP is an 
important program for assisting producers dealing with increased water 
quality regulation. We support the $100 million increase for EQIP 
proposed by the Administration to bring funding to $300 million. We 
also support the removal of the CCC Section 11 cap on reimbursement of 
NRCS for technical assistance provided for CRP and Water Reserve 
Program delivery.
    We oppose all user fees for conservation programs.
    We oppose the Administration's zero funding for the Forestry 
Incentive Program and suggest funding of $6 million.
    We support APHIS funding of:
  --$1.2 million to facilitate development of a National Animal Health 
        Emergency Management System;
  --$68 million to maintain and enhance the Animal Health Monitoring 
        and Surveillance program, including funding for both Johne's 
        and trichinae programs
  --$10.6 million for veterinary biologics
  --$16.9 million for veterinary diagnostics to facilitate more 
        reliable tests for use with animals that are to enter the U.S. 
        as well as for emerging diseases such as Johne's and porcine 
        respiratory and reproductive syndrome.
  --$3.8 million for the animal care unit to bring total funding to $13 
        million. This will allow for effective operation and 
        enforcement of the Animal Welfare Act.
    We support the FSIS proposal of $33.1 million for continued 
implementation of the HACCP based food inspection system. We are 
opposed to user fees to finance federally mandated meat and poultry 
inspection programs. Programs to ensure food safety benefits everyone 
should be funded by tax dollars.
                                 ______
                                 
  Prepared Statement of the American Honey Producers Association, Inc.
    My name is Richard Adee. I am President of the American Honey 
Producers Association, Inc. and I am submitting this statement in its 
behalf. The American Honey Producers Association, Inc. is a national 
organization of commercial beekeepers with activities in most of the 
States in this country.
    First, the Association wishes to thank you for the support the 
Subcommittee has provided in the past for agricultural research 
activities in behalf of the beekeeping industry. It has enabled the 
Agricultural Research Service to staff its bee laboratories at the 
minimum level necessary to meet with the critical needs of the 
industry. At this time, the Association supports the President's budget 
proposal for bee research with one notable exception. To continue this 
research, the Association is seeking the restoration of $200,000 that 
the Administration would cut from the baseline funding for the bee 
laboratory at Weslaco, Texas, along with cuts for many other research 
projects contained in the fiscal year 1999 appropriation. On the other 
hand, we fully support the increase in the level of funding recommended 
by the Administration for the ARS honey bee breeding, genetics, and 
physiology laboratory at Baton Rouge, Louisiana.
    (1) Background.--Honey bees pollinate over 90 cultivated crops 
whose estimated value exceeds $9.3 billion and produce an average of 
227 million pounds of honey annually. Since 1984, the survival of the 
honey bee has been threatened by continuing infestations of mites and 
pests for which appropriate controls have not yet been developed and 
research must provide the answers. Unfortunately, there is no simple 
solution to these problems. The honey bee industry is too small to 
support the cost of the needed research, particularly with the current 
depressed state of the industry. As you know, there are no longer any 
federal subsidies on honey. Further, there are no funds, facilities, or 
personnel elsewhere available in the private sector for this purpose. 
Accordingly, the beekeeping industry is dependent on research from 
public sources for the scientific answers. The key to the survival of 
the honey industry lies with the honey bee research program conducted 
by the Agricultural Research Service.
    (2) Research at the ARS Weslaco, Texas, Laboratory.--Parasitic 
mites, primarily the varroa mite, are causing a crisis for the U.S. 
beekeeping and pollination industry. Tens of thousands of domestic 
honey bee colonies are being lost annually to varroa mites. Wild bee 
colonies have been decimated. The only chemical now registered for 
varroa mite control, fluvalinate, is being rendered ineffective by the 
development of resistant mite populations. The USDA honey bee lab at 
Weslaco, Texas, has been working hard trying to find alternative 
chemicals to control the varroa mite. This past summer it appears that 
they have found a chemical, coumaphos, which is equally effective as 
fluvalinate. This is a real break through for the bee industry but as 
of today we have only been able to obtain a section 18 emergency 
registration. Much work still remains to be done before a section 3 
general registration is granted by EPA.
    A new pest, the small hive beetle, has been found in Florida this 
past year and has caused severe bee colony losses. Apparently, it 
originated in South Africa. Estimates put the losses in just one season 
at over 30,000 colonies. There is evidence that the beetles are 
spreading to other areas in the East coast. As the beetles spread, they 
will just devastate the bee industry. In order to contain the beetle, 
several states have quarantined bees from Florida, North Carolina, 
South Carolina, and Georgia or are actively considering such 
quarantines.
    The USDA-ARS honey bee research scientists at the Weslaco 
laboratory have been working overtime to find chemicals, techniques, 
pheromones, or other methods of controlling the beetle. Time is of the 
essence, as a control must be found immediately as all the bee colonies 
in the Western Hemisphere are at risk.
    Additionally, the Weslaco lab is responsible for finding new and 
improved methods for control of other parasitic mites as well as 
solving beekeeping problems that interfere with honey production and 
effective crop pollination, and determining the impact and spread of 
Africanized honey bees.
    The uncertainty of continued funding is hampering the efforts of 
the Weslaco laboratory in finding a solution to our most pressing 
problems. They cannot operate effectively with a reduction of $200,000 
in its baseline appropriation. These funds need to be restored.
    (3) Research at the ARS Baton Rouge, Louisiana, Laboratory.--The 
Association supports the request of the Administration for an increase 
of $300,000 in the appropriation for the ARS laboratory at Baton Rouge, 
Louisiana. The Baton Rouge lab is the only laboratory world wide 
focusing on the development of long-term, genetics-based solutions to 
the varroa mite. Their research programs have taken them to the far 
corners of the world looking for mite resistant bees. In eastern 
Russia, they found bees that have co-existed for decades with the mites 
and survived. The bees were brought to the United States and are in the 
process of being evaluated to assure that the resistance holds up under 
a wide range of environmental and beekeeping conditions. Attributes 
such as vigor, pollination, and honey production must be tested. There 
is an immediate need to propagate the resistant queen bees in large 
numbers for wide scale distribution to beekeepers so that this 
evaluation can be accomplished. The work is slow and tedious. It is 
also costly. The requested appropriation will accelerate the research, 
development, and transfer of queen bee stock resistant to varroa mites 
to U.S. beekeepers.
    (4) Summary.--In conclusion, we wish to thank you again for your 
support of honey bee research in the past. We would appreciate your 
continued support by approving restoration of the $200,000 that the 
Administration would cut from the fiscal year 2000 appropriation for 
the Weslaco, Texas, lab and by otherwise supporting the 
Administrations's request for bee research. This would include the 
increased appropriation recommended for the AES Baton Rouge, Louisiana, 
lab, as discussed previously in this statement. Only through research 
can we achieve and maintain profitability in U.S. beekeeping industry 
and continue to provide stable and affordable supplies of bee 
pollinated crops which make up fully one-third of the U.S. diet.
    I would be pleased to respond to any questions that you may have.
                                 ______
                                 
 Prepared Statement of the American Indian Higher Education Consortium
I. Introduction
    Mr. Chairman and Members of the Subcommittee, on behalf of the 
American Indian Higher Education Consortium (AIHEC) and the 30 Tribal 
Colleges that comprise the AIHEC land-grant institutions, we thank you 
for this opportunity to share our funding requests for fiscal year 
2000. On behalf of the Tribal Colleges, we respectfully request full 
funding of our original four land-grant programs, along with funding 
under the Agriculture Research Reauthorization. Specifically, we 
request: $4.6 million for the Tribal College endowment; $1,552,000 for 
the equity grant program; $5 million for the extension program; $1.7 
million for institution capacity building grants; and $10 million for 
research.
    This statement will cover three key points: First, it will provide 
a brief background on the Tribal Colleges and our long-awaited 
inclusion in this nation's land-grant system; second, it lays out 
Tribal Colleges' ambitious efforts through extension services to 
fulfill the agricultural potential of American Indian communities and 
to ensure that American Indians have the skills needed to maximize the 
economic development potential of our resources; and third, it 
describes and justifies our other program requests for fiscal year 
2000.
II. Background on Tribal Colleges
    Today, almost 140 years after enactment of the first land-grant 
legislation, Tribal Colleges, more so than any other institutions, 
truly exemplify the original intent of the land-grant legislation. The 
first Morrill Act was enacted in 1862 specifically to bring education 
to the people and to serve their fundamental needs. Mr. Chairman, this 
is the definition and mission of the Tribal Colleges. We truly are 
institutions by, of, and for our people.
    The dismal statistics concerning the American Indian experience in 
education brought tribal leaders to the realization that only through 
local, culturally-based education could many American Indians succeed 
in higher education and help bring desperately needed economic 
development to the reservations. In the late 1960s and early 1970s, the 
first Tribal Colleges were chartered on remote reservations by their 
respective tribal governments, to be governed by boards of local tribal 
people. In 1972, the first six tribally-controlled institutions came 
together to form the American Indian Higher Education Consortium. 
Today, AIHEC is a cooperatively sponsored effort on the part of 32 
member institutions in the United States and Canada, 30 of which are 
the 1994 Land-grant Institutions. AIHEC has become the premier national 
voice of the Tribal College movement and Indian higher education.
    Tribal Colleges now serve more than 25,000 students each year, 
offering primarily two-year degrees, with some colleges offering four-
year and graduate degrees. Since their inception, the Tribal Colleges 
have helped address the problems and challenges of our welfare system. 
Tribal Colleges provide GED, other college preparatory courses and have 
high success rates in student job training and placement. Our mission 
requires us to help move American Indians toward self-sufficiency and 
help make American Indians productive, tax-paying members of our 
society. Fulfilling this obligation will become even more difficult 
over the next several years as Tribal Colleges feel the impact of the 
welfare reform laws. Already, our colleges are seeing increasing 
numbers of welfare recipients turning to the colleges for training and 
employment opportunities. Also, Tribal Colleges serve as community 
centers, providing libraries, tribal archives, career centers, economic 
development and business centers, public meeting places, and child care 
centers.
    Despite our many obligations, functions, and notable achievements, 
Tribal Colleges remain the most poorly funded institutions of higher 
education in this country. Historically, states do not have an 
obligation to American Indian lands because our reservations are trust 
lands under federal jurisdiction. Unlike mainstream land-grant 
institutions, we cannot depend on state and local governments to match 
or surpass the federal investment. Our core funding under the Tribally-
Controlled College or University Assistance Act of 1978 remains grossly 
inadequate; and total funding for the agriculture programs authorized 
for all 30 of the 1994 Institutions combined is less than the amount 
the Department of Agriculture gives to just one state land-grant 
institution each year.
III. Extension Services--Ambitious Efforts to Reach Economic 
        Development Potential
    Although current land-grant programs at the Tribal Colleges are 
modest, our 1994 authorizing legislation is vitally important to us 
because of the nature of our land base. Of the 54.5 million acres that 
comprise American Indian reservations, 75 percent are agricultural 
lands and 15 percent are forestry holdings. In fact, Indian 
agricultural production has been valued at nine times the production 
potential of oil and gas resources.
    Tragically, due to lack of expertise and training, millions of 
acres lie fallow, under-used, or are developed through methods that 
render the resources non-renewable. The Educational Equity in Land-
Grant Status Act of 1994 is our hope for turning this situation around. 
It is absolutely critical that American Indians learn more about new 
and evolving technologies for managing our lands. We are committed to 
becoming, as we were when your forefathers came to this land centuries 
ago, productive contributors to this nation's--and the world's--
agricultural base.
    Recent years show impressive efforts to address economic 
development through land use, as Tribal Colleges entered into 
partnerships with 1862 Land-grant Institutions through extension 
services. The Extension program represents an ideal combination of 
federal resources and Tribal College-state institution expertise, with 
the overall impact being far greater than the sum of the parts. Some 
examples of the innovative programs that are funded under extension 
services include:
  --Northwest Indian College, Bellingham WA and Washington State 
        University are partnering in a special emphasis grant project 
        entitled: ``Honor the Gift of Food''. The objective of this 
        undertaking is to support and expand a distance-learning 
        nutrition education program for Pacific Northwest Tribal 
        communities. The overall goal will be to develop nutrition 
        education modules and support materials to train nutrition 
        assistants in tribal communities.
  --Fort Peck Community College in Poplar, MT and Montana State 
        University-Bozeman, are collaborating on a project focusing on 
        development of institutional infrastructure and capacity 
        building from which FPCC will provide extension services in the 
        areas of ``Community Resource and Economic Development'' and 
        ``Family Development and Resource Management''. Specifically, 
        program objectives associated with these areas are designed to 
        strengthen existing employers and attract new enterprises and 
        local entrepreneurship.
    Additional funding to support such efforts is needed because 
extension services provided by the states on our reservations are 
woefully inadequate, and the Tribal Colleges need to fill that void. It 
is important to note that this program is not duplicative of ongoing 
extension activities, as it is specifically designed to complement and 
build upon the Indian Reservation Extension Agent program. In Fiscal 
1999, the 1994 institutions were awarded $2,060,000 for extension 
services. In fiscal 2000, we are requesting that Congress build on the 
$3.5 million proposed in the President's budget, and raise funding to 
$5 million, the fully authorized level for this program. The increase 
recommended in the President's request emanates from the strong 
relationship we have with USDA and is evidence of our successes in this 
program.
IV. Other Funding Requests For Tribal College Program
    The thirty 1994 Institutions' appropriations request for fiscal 
year 2000 are extremely modest when compared with the annual 
appropriations to each existing land-grant institution. Along with our 
request of $5 million for our cooperative extension program, we are 
seeking the following amounts for the four other authorized programs 
for 1994 Institutions: $4.6 million for the Tribal College endowment 
(not scored as budget outlay); $1.552 million for the equity grant 
program; and $1.7 million for institution capacity building grants; and 
$10 million for research.
    The Tribal Colleges are grateful for the Subcommittee's past 
support of the three programs that have been funded. These small 
programs catalyzed the 1994 Institutions' crucial first steps in 
initiating and strengthening agriculture and natural resource programs 
in our communities. However, it is critical that we build on the 
momentum we have gained. Justifications for our requested funding 
levels are as follows:
    (1) $1.7 million Institutional Capacity Building Grant Program.--
This competitive grant program, which requires a non-federal match, 
would provide the 1994 Institutions with the investment necessary to 
allow us to strengthen and more fully develop our educational 
infrastructure. Facilities maintenance and improvement are urgently 
needed at many of the Tribal Colleges, which are currently operating in 
donated, abandoned and even condemned buildings. Hazards include 
leaking roofs, asbestos insulation, exposed wiring, and crumbling 
foundations. In a recent needs assessment, nine of the Tribal Colleges 
identified facility maintenance and renovation as a high priority, at 
an estimated cost of $8.3 million. Many of these facility improvements 
are needed to provide American Indian students with the education 
necessary to fully compete in the modern agricultural world.
    (2) $4.6 million Endowment Fund for 1994 Land-Grant Institutions.--
This endowment installment remains with the U.S. Treasury, and only the 
interest is distributed to the 1994 Institutions. It is important to 
note that this program is not scored as budget outlay or authority. 
Just as other land-grant institutions historically received large 
grants of land or endowments in lieu of land, this sum assists the 1994 
Institutions in establishing and strengthening our academic programs in 
such areas as curricula development, faculty preparation, and 
instruction delivery. The third year interest payment totaled $673,678, 
which was distributed among all of the 1994 Land-grant Institutions on 
a formula basis.
    (3) $1.552 million Tribal College Educational Equity Grant 
Program.--Closely linked with the endowment fund, this program last 
year provided almost $52,000 per 1994 Institution to assist in academic 
programs. The 1994 Institutions are in their third year of funding 
under this program. Through the funding made available since fiscal 
year 1996, the Tribal Colleges were able to begin to support vital 
courses and planning activities specifically targeted to meet the 
unique needs of our respective reservations. Examples of these programs 
include:
  --Fond du Lac Tribal and Community College's Environmental Institute, 
        located in Cloquet, MN is entering the third phase of its 
        Environmental Science Delivery Project that is designed to 
        attract students to environmental studies by combining the 
        latest and most sophisticated technologies and teaching 
        methodologies with the historical perspective of American 
        Indian culture. One additional goal of this phase of the 
        project is to expand the Environmental Study Area to include an 
        Environmental Interpretative Center. The college intends to 
        continue current projects as well as implement new 
        collaborative environmental projects with various public and 
        private agencies to promote student education and research 
        opportunities.
  --Southwestern Indian Polytechnic Institute (SIPI), in Albuquerque, 
        NM has used the education equity grants to build the SIPI 
        Agricultural Science, Engineering and Technology (ASET) 
        Development Project. The overall goal of the SIPI-ASET project 
        involves the establishment of a comprehensive Agricultural 
        Science, Extension and Technology program which serves the 
        immediate and long-term economic needs of the National Indian 
        Community, and also provides a bridge to regional university 
        programs in science, engineering and agricultural technologies.
    Other Tribal Colleges have started natural resource management 
courses; nutrition and dietetic programs; environmental sciences 
curricula; comprehensive horticulture programs; and courses on 
sustainable development, forestry, and buffalo production and 
management.
    Funding for Research.--In addition, we are requesting funding for 
our newly authorized research program, which was authorized at ``such 
sums as necessary'' as an amendment to the Agriculture Research, 
Extension, and Education Reform Act of 1998. With 30 institutions 
competing in this new research authority, we feel the President's 
suggested level of $667,000 is simply not adequate to address the 
pressing agricultural and nutritional research needs of our colleges 
and their communities. Therefore, we respectfully request an 
appropriation level of $10 million.
    This authority, and its corresponding appropriation, is vital to 
ensuring that Tribal Colleges finally have the opportunity to become 
full partners in this nation's land-grant system of colleges and 
universities. Many of our institutions are currently conducting applied 
agriculture-based research, yet they struggle to finance this research 
and meet their community's other research needs. Some of the research 
in progress includes soil and water quality research; amphibian 
propagation; pesticide and wildlife research; range cattle species 
enhancement; and native plant preservation for medicinal and economic 
purposes. We urge the committee to fund this program at an appropriate 
level to allow our institutions to develop and strengthen their 
research potential.
V. Conclusion
    The 1994 Institutions are efficient and effective tools for 
bringing education to American Indians and bringing opportunity and 
hope for self-sufficiency to this nation's poorest regions. The modest 
federal investment in the Tribal Colleges has paid great dividends in 
terms of employment, education, and economic development, and 
continuation of this investment makes sound moral and fiscal sense. No 
communities are in greater need of land-grant programs than American 
Indian reservations, and no institutions better exemplify the original 
intent of land-grant institutions than the Tribal Colleges.
    Mr. Chairman and Members of the Subcommittee, we appreciate your 
long-standing support of the Tribal Colleges and are grateful for your 
commitment to bring self-sufficiency to our communities. We look 
forward to continuing a partnership with you, the U.S. Department of 
Agriculture, and the mainstream land-grant system--a partnership that 
will bring equal educational, agricultural, and economic opportunities 
to Native America. Thank you again for inviting us to present our 
statement to you.
                                 ______
                                 
       Prepared Statement of the American Seed Trade Association
    Mr. Chairman and members of the Subcommittee, we appreciate this 
opportunity to provide you with our views on the fiscal year 2000 
agricultural appropriations bill. The American Seed Trade Association 
(ASTA), founded in 1883, is one of the oldest trade associations in the 
United States. With 850 members, the ASTA is the premiere advocate for 
the seed industry and related interests. ASTA's diverse membership 
consists of the leading companies that are developing, providing, 
supporting, and promoting new varieties that hold tremendous promise 
and opportunity for farmers and consumers everywhere. ASTA strongly 
urges you to provide, at least, a $5 million increase in fiscal year 
2000 funding for the National Plant Germplasm System (NPGS).
    Our request for a $5 million increase for the NPGS is the number 
one appropriations issue and the number one legislative issue for ASTA. 
This increase will allow seed companies to meet the diverse challenges 
facing our customers. Support for significant increases to the NPGS 
goes well beyond industry; we, also, have the support of our customers 
and the scientific community since they recognize that this will pay 
huge dividends. We recognize the tight budget constraints under which 
the Subcommittee must operate; however, we believe a significant 
increase in funding for the NPGS is integral to U.S. agriculture 
reaping the full benefits of biotechnology and the ongoing genomics 
revolution.
    Over the past few years, much attention has been focused on the 
enormous potential that biotechnology offers to American agriculture 
and the Nation's consumers. Many of the challenges confronting the U.S. 
can be met through the application of plant-based technologies. With 
sufficient genetic resources, we will have an abundant, safe, 
nutritious, and affordable supply of food and fiber that is produced in 
an environmentally friendly manner and that ensures a reasonable return 
for our farmers and livestock producers. In an editorial in Science 
magazine last year, Philip H. Abelson stated that ``ultimately, the 
world will obtain most of its food, fuel, fiber, chemical feedstocks, 
and some of its pharmaceuticals from genetically altered vegetation and 
trees.'' (Science, Vol. 279). We agree that biotechnology can 
revolutionize American agriculture and can provide continually 
renewable resources for all of these products, if diverse genetic 
resources are available and accessible to U.S. scientists and plant 
breeders. Molecular biotechnology has given us new opportunities to tap 
genetic resources more effectively and efficiently, if the resources 
have been preserved and are accessible.
    To take full advantage of modern biotechnology, we must have access 
to diverse genetic resources that will allow us to develop the 
varieties necessary to meet new and changing needs. The improvement of 
plants is based on the utilization of genetic diversity. Without a wide 
diversity of genetic resources, there will be nothing available, 
eventually, to improve plants or to prevent plants from becoming 
genetically susceptible to plant pathogens. Narrow genetic bases can 
result in widespread crop losses. For example, in 1970, Southern corn 
leaf blight cost farmers 15 percent of the corn crop; in the 1950s and 
early 1960s, about 70 percent of the wheat crop in the Pacific 
Northwest was wiped out by stripe rust; and the Irish potato famine of 
the 1840s was the result of the reliance on only a single variety of 
the potato. Breeders must have open access to extensive, well-
maintained, and well-documented genetic resources.
    Preserving the genetic diversity of plants is essential to the 
future of agriculture as the genes to add new traits, such as tolerance 
to diseases and resistance to insects, are often present in wild 
relatives of the major crops. Wild ancestors and relatives of 
cultivated plants give us the sustained ability to develop new 
varieties. Most of the U.S. crops raised and used for food, fiber, 
ornamentals, and industrial feed stocks originated from outside of the 
U.S. Consequently, the plant breeding community is highly dependent 
upon germplasm from other countries, some of which is endangered. Once 
lost, the germplasm cannot be fully reconstructed. These sources of 
productive capacity and efficiency and sources for potential resistance 
to pests and environmental stresses may be lost forever. Continued use 
of and access to a broad diversity of germplasm is necessary, if we are 
to develop varieties to meet new and changing circumstances and if we 
are to sustain agricultural productivity.
    The NPGS germplasm collections underpin crop breeding efforts 
throughout the U.S. Preservation of and filling gaps in the base 
collections is a unique Federal responsibility. The major activities of 
the NPGS include (1) acquiring germplasm; (2) developing and 
documenting information on the germplasm in its collections (including 
entering the information into the Germplasm Resources Information 
Network); (3) preservation and distribution of the germplasm; and (4) 
maintenance of quarantine facilities for testing of imported germplasm 
for pests and pathogens before introduction in the U.S. The NPGS 
maintains over 440,000 germplasm samples for over 85 crops.
    To ensure that these genetic resources are accessible and that they 
remain available, the NPGS must obtain a significant increase in 
funding over the next few years. Last year, recognizing the crucial 
importance of diverse genetic resources, the ASTA board of directors 
passed a resolution that calls for approximately a doubling, by 2002, 
of the annual Agricultural Research Service (ARS) budget for the NPGS. 
This would result in a minimum level of $40 million for the NPGS by 
2002. While this may seem to be an exceptionally large request, the 
same amount has been called for since 1991. In that year, the NPGS 
reported that an annual budget of $40 million would be required, over a 
ten-year period, to remedy shortfalls in secure storage, back-up, 
evaluation, and development of core germplasm collections. According to 
a recent GAO report (GAO/RCED-98-20), ARS funding for the NPGS between 
1992 and 1996 declined by 14 percent, in constant dollars, while 
germplasm collections increased by more than 10 percent. The picture is 
even more bleak when one takes into consideration the substantial 
reduction in non-salary dollars available for NPGS operations 
(including acquisitions), equipment, supplies, and facilities. For 
fiscal year 1999, only 15 percent of the budget is available for these 
critical aspects of the program.
    The steady decline in available funding has had an extremely 
negative impact on the NPGS. To fulfill its mission to provide access 
to diverse genetic resources, the NPGS must have a balanced program 
that includes (1) acquisition of germplasm to fill gaps in the 
collections and to preserve endangered germplasm; (2) maintenance and 
preservation of germplasm with secure back-ups to prevent loss; (3) 
adequate documentation and characterization of the germplasm; (4) 
sufficient supplies of viable seeds to allow for distribution; and (5) 
quarantine facilities that make germplasm available in a timely manner.
    Unfortunately, the lack of resources has placed the NPGS in a dire 
state. Insufficient funding, as well as the increasing difficulties 
encountered while attempting to acquire germplasm from developing 
countries, has limited germplasm acquisitions. Today, additions to the 
collections have slowed to one-fourth of the level they were at in 
1993. And, according to the above referenced GAO report, even when NPGS 
acquires germplasm, its release to breeders and scientists is often 
delayed as a result of the management of the quarantine process.
    Further, seed and clonal collections are without secure back-ups, 
adequate evaluation, documentation, and viability. For genetic 
resources to be useful, sufficient information concerning the germplasm 
must be available. The lack of germplasm passport information, 
documenting the geographic origin and ecological condition of the 
origin site, makes it difficult to utilize, fully, the sample and it 
precludes the development of long-range planning for the acquisition of 
germplasm. Currently, two-thirds of the NPGS germplasm lacks passport 
data on its location of origin. In many cases, even when data on traits 
such as plant structure and color have been developed, the information 
has not been entered into the database.
    One of the primary purposes of gene banks is to preserve, and 
provide accessibility to, germplasm forever. To ensure that germplasm 
maintains viability, germination must be tested and the germplasm must 
be regenerated in a timely manner. The seeds of some plants remain 
viable for only a few years and without regeneration, they may be lost 
forever. Backlogs in regeneration can result in loss of diversity and, 
in some cases, the loss of resources that cannot be duplicated. 
According to the GAO, preservation activities--including viability 
testing, regeneration, and secure, long-term back-up storage of 
germplasm--have not kept pace with the preservation needs. When 
resources are restricted, administrative staff have no choice but to 
focus most of the budget on maintaining and preserving the current 
germplasm collections. Although 75 percent, or more, of the NPGS budget 
is devoted to maintenance and regeneration, the NPGS simply does not 
have enough funding to keep up with regeneration needs. According to 
the GAO report referenced above, at two of the plant introduction 
stations (Griffin, GA, and Pullman, WA), it may take 75 to 100 years 
for the samples to be regenerated, assuming current funding levels. 
With these kinds of backlogs, it is very likely that important 
germplasm will be lost.
    Germplasm must be available for distribution for it to be 
beneficial. The NPGS distributes germplasm to plant breeders and 
scientists from all over the world. A minimum of 10,000 seeds is 
required before a particular germplasm sample can be distributed. In 
some cases, germplasm is not available, currently, because the NPGS has 
not had sufficient resources to generate or regenerate enough samples 
to allow for distribution.
    In addition to the requirements for regeneration, it is essential 
to have back-ups of the collection. While NPGS policy requires back-up 
at the National Seed Storage Laboratory, over one-third of the 
accessions are not. In 1992, over 2,000 germplasm samples were lost at 
the Miami facility following Hurricane Andrew. Since these samples were 
not backed-up at another facility, they were lost.
    The above problems are just a few of the many that are plaguing the 
NPGS due to the lack of adequate funding. These problems, however, are 
jeopardizing the security of the U.S. food and fiber system. As some 
plant breeders have stated, genetic diversity is the engine that drives 
plant breeding. Without new sources of genetic variation, plant 
breeders cannot make improvements. Without improvements, we will be 
unable to ensure the continued economic viability and security of our 
food and fiber system.
    The NPGS is a fundamental, strategic resource that we cannot afford 
to jeopardize. Without a significant infusion of funds, the NPGS will 
not be able to ensure the preservation of important germplasm. We 
strongly, urge you to provide a minimum increase of $5 million for 
fiscal year 2000 and to double the funding for the NPGS by fiscal year 
2002. We recognize that this will be difficult and that there are many 
competing priorities for limited resources; however, we cannot afford 
to be complacent. We believe that a $5 million increase for next year 
will send a signal that the Congress is committed to preserving this 
vital, strategic resource.
    We, also, understand that the American Soybean Association has 
requested a $500,000 appropriation for an ARS soybean pathogen 
collection. ASTA believes that microbial germplasm collections are, 
also, important, and we, therefore, support that request.
    Thank you for the opportunity to present ASTA's views on the 
importance of the National Plant Germplasm System. We look forward to 
working with you to ensure that the NPGS is able to provide the 
germplasm necessary for U.S. agriculture to meet the demands and 
challenges of the 21st Century.
                                 ______
                                 
  Prepared Statement of the American Sheep Industry Association, Inc.
    The American Sheep Industry Association (ASI) is a federation of 
state member associations representing the nearly 80,000 sheep 
producers in the United States. The sheep industry views numerous 
agencies and programs of the U.S. Department of Agriculture as 
important to lamb and wool production. Sheep industry priorities 
include rebuilding and strengthening our infrastructure, critical 
predator control activities, maintaining and expanding research 
capabilities and animal health efforts.
    The rapid changes that have occurred in the domestic sheep industry 
and continue to take place put further emphasis on the importance of 
adequately funding the U.S. Department of Agriculture programs 
important to lamb and wool producers.
    We appreciate this opportunity to comment on those portions of the 
USDA fiscal year 2000 budget.
           animal and plant health inspection service (aphis)
    The mission of APHIS, ``to protect U.S. animal and plant resources 
from diseases and pests,'' is very important to the sheep industry of 
the nation.
Wildlife Services
    With the loss of 520,000 sheep and lambs to predators each year, 
the Wildlife Services (WS) program of USDA-APHIS is vital to the 
economic survival of the sheep industry. The value of sheep and lambs 
lost to predators and predator control expenses are second only to feed 
costs for sheep production. Costs associated with predation currently 
exceed our industry's veterinary, labor and transportation costs.
    The sheep industry adamantly disagrees with the Administration's 
budget proposal to reduce the Wildlife Services operations budget $1.8 
million and to decrease methods development funding $776,000. If salary 
increases, which are rarely funded by Congress, are included, the total 
budget cut recommended by the President total $3.47 million. Add the 
$1.2 million in funds that is redirected and existing programs will be 
impacted $4.7 million. Such reductions will have devastating impacts on 
agriculture and other programs.
    Budget recommendations should not punish agriculture for providing 
wildlife, belonging to the American public, with habitat. According to 
the International Association of Fish & Wildlife Agencies, agriculture 
and private landowners provide over 70 percent of the habitat for the 
American public's wildlife. The National Agricultural Statistics 
Service estimates that two-thirds of the nation's farms suffer some 
form of wildlife damage each year. The Berryman Institute for Wildlife 
Damage Management estimates wildlife damage is costing agricultural 
producers over $4 billion annually.
    Wildlife Services has over 1,400 cooperative agreements with 
agriculture, forestry groups, private industry, state game and fish 
departments, departments of health, schools, county and local 
governments and others to mitigate the damage and danger that the 
public's wildlife can inflict on private property and public health and 
safety. This budget proposal not only cuts federal cooperative dollars, 
but also endangers cooperative funding raised through these agreements. 
Such cuts mean fewer Wildlife Services professionals will be available 
to not only assist agriculture, but other areas including human health 
and safety and endangered species management.
    Wildlife Service's cooperative nature has made it the most cost 
effective and efficient program within federal government in the areas 
of wildlife damage management and public health and safety. WS is one 
of the few federal programs that has been consistently at or above the 
50:50 federal to cooperative funding ratios. If you discount 
Congressional Directives, cooperative entities provided 55 percent of 
the total funding in fiscal year 1997, while the federal appropriations 
made up 45 percent of the cooperative dollars. The President's 
recommendation that a 50:50 ratio of cooperator funding be applied at 
the state and local level has no justification in statute, regulation 
or policy. Efforts by the administration to micromanage this successful 
cooperative program will only serve to take away needed flexibility of 
WS managers and will inhibit Wildlife Service's ability to accomplish 
its mission as mandated by the Animal Damage Control Act, NEPA and the 
Government Performance and Results Act.
    Although funding for Wildlife Services has seen slight increases in 
past years, most increases were in the form of Congressional Directives 
aimed at specific problems. Inflation has slowly eaten away at funds 
used to support general operations programs. ASI strongly supports the 
funding for fiscal year 2000 to be set at $32,346,000, an increase of 
$2,349,000 over the fiscal year 1999 level.
    Aerial hunting is one of Wildlife Service's most efficient and 
cost-effective core programs. It is used not only to protect livestock, 
but is also critical for protection of wildlife such as mule deer in 
Utah and in endangered species programs such as those for the wolf and 
grizzly. A lack of funding for adequate safety was found to have 
contributed to a number of accidents experienced within the program. To 
implement core aerial safety provisions, a total of $2.457 million is 
needed. This is an increase of $1.257 million over the fiscal year 1999 
budget.
    In fiscal year 1999, Congress provided $350,000 for wolf management 
in Rocky Mountain region and Minnesota. A total of $742,000, a $392,000 
increase over last year's budget, is needed to properly manage wolves. 
Wolf numbers have doubled in Montana, Wyoming and Idaho, and wolf 
predation on livestock consumed the funds provided by USDA and DOI by 
June of 1998. ASI asks Congress to fully fund the $175,000 directive 
for wolf management in the fiscal year 2000 budget, plus add an 
additional $72,000 to cover last year's shortfall in the program. 
Minnesota, Wisconsin and Michigan are experiencing similar rates of 
increase in wolf numbers and predation. ASI asks that Congress increase 
the funding for wolf management in Minnesota and Wisconsin $145,000 
over the funds provided in fiscal year 1999.
    The President's budget recommends that $1.5 million for rabies 
control be cut. The control of rabies is vital to human health and 
safety in a number of states and ASI asks Congress to restore these 
funds in the budget.
    Last year, Congress redirected $700,000 for brown tree snake 
control in Hawaii. This program should be fully funded by Congress. 
While ASI is supportive of civilian airport safety, Congress should 
fund new airport safety programs it feels necessary rather than 
redirect existing program funds.
    ASI asks Congress to fund Wildlife Service's Methods and 
Development at the fiscal year 1999 level of $10,365,000. Budget cuts 
suggested by the President will stop or reduce a number of important 
programs including rate damage in Hawaii, blackbird work on rice in 
Louisiana, sunflower work in the Dakotas and mammal contraceptive and 
predation work in Utah.
Emergency Management
    The ability to manage animal health emergencies is crucial to the 
survival and well being of U.S. animal agriculture and the security of 
the nation's food supply. We are encouraged by the administration's 
request of $1 million for a ``national animal health emergency 
management system''. We believe that this is an important first step in 
developing a more modern, functional system that will improve and build 
upon state programs and industry initiatives.
Scrapie
    Adequate funding of the Voluntary Scrapie Flock Certification 
Program and other scrapie control measures through USDA-APHIS is of 
critical importance to the sheep industry, as well as all segments of 
the livestock industries. ASI appreciates this Subcommittee's efforts 
in recognizing the seriousness of this devastating disease and the real 
need for control and eradication. ASI and others have urged APHIS to 
step up its efforts in scrapie control/eradication through a more 
aggressive regulatory approach. We request that the scrapie control/
eradication program be funded more adequately in fiscal year 2000 as 
requested by the administration.
    No country has, to date, conducted an active surveillance study of 
scrapie. ASI has requested that APHIS conduct a national surveillance 
study of scrapie since our industry's ability to compete in the market 
place is encumbered by both existence of scrapie in our flock and the 
lack of quantitative data about the disease. ASI has committed to 
investing producer funds to help cover laboratory costs associated with 
the study. Additional appropriations up to $600,000 are supported by 
the industry to insure completion of this critical surveillance effort.
                     agricultural marketing service
Lamb Market Information and Price Discovery Systems
    The sheep industry strongly supports the fiscal year 2000 budget of 
$22,166,000 for Market News of USDA-Agricultural Marketing Service. The 
increased appropriations of $820,000 is critical for the agency to 
conduct the increased international market reporting and activities 
associated with the concentration in the livestock industry. The sheep 
industry has requested a review and update to the lamb and lamb meat 
market reporting system in the U.S. and inclusion of imported lamb 
product prices in the market news.
                   foreign agricultural service (fas)
    The sheep industry participates in FAS programs such as the Market 
Access Program (MAP) and the Foreign Market Development Program. ASI 
strongly supports continued appropriations at the fiscal year 1998 
level for these critical Foreign Agricultural Service programs. ASI is 
the cooperator for American wool and sheep genetics and has achieved 
remarkable success in increasing exports of domestic wool, breeding 
sheep and semen. Wool exports have increased 170 percent over the last 
five years with the aid of this funding. American lamb sales also 
benefit from the Foreign Market Development Program through increased 
international efforts.
             natural resources conservation service (nrcs)
    ASI urges increased appropriations for the range programs of the 
Soil Conservation Service to benefit the private range and pasture 
lands of the United States with conservation assistance. We support the 
budget item and recommend an increased level for the Grazing Lands 
Conservation Initiative that ASI has worked with, along with other 
livestock and range management organizations, to address this important 
effort for rangelands in the U.S.
                   research, education and economics
    The sheep industry recognizes that it must become globally 
competitive. We are also striving to be profitable and sustainable as a 
user of and contributor to our natural resource base. Research, both 
basic and applied, and modern educational programming is essential if 
we are to succeed. We are disappointed in the decline in resources USDA 
is targeting toward sheep research and educational programs. With 
approximately $15 million in ARS funding increases for animal systems 
in fiscal year 1999, there was an actual reduction in the planned 
expenditure for sheep with all other livestock categories receiving 
significant increases. In the Administration's fiscal year 2000 budget, 
ARS has a planned expenditure of less that $200,000, again out of an 
approximate $15 million increase for animal systems with other 
livestock species targeted for significant increases.
    In order for the sheep industry specifically and U.S. agriculture 
in general to be globally competitive and environmentally sound in the 
future, we must invest in the discovery and adoption of new 
technologies for producing, processing and marketing food and fiber. We 
urge the subcommittee to send a strong message to USDA supporting sheep 
research and education funding increases.
Agricultural Research Service
    ASI urges an increase in funding of the scrapie research 
initiatives at Pullman, Washington in the following areas: (1) defining 
the relationships between prion genetics, resistance to infection and 
linkage to production traits and (2) the further development of and the 
validation of pre-clinical, live-animal diagnostic tests. A 
collaborative relationship has been developed between the ARS 
laboratory at Pullman, Washington and the U.S. Sheep Experiment Station 
at Dubois, Idaho which will combine the appropriate resources to begin 
answering the above mentioned needs. An additional $400,000 
appropriation is needed to do this work.
    We also urge the subcommittee to recommend an additional 
appropriation to study ovine progressive pneumonia (OPP) in the area of 
immunogenetics and host resistance in sheep as a collaborative study 
between the ARS laboratories at Pullman, Washington and the U.S. Sheep 
Experiment Station at Dubois, Idaho. OPP is endemic in U.S. sheep 
population, causes economic damage to the industry and is an impediment 
to trade with some countries. An additional $300,000 is needed to begin 
this study.
    Research into Johne's disease has received additional funding 
through ARS over the past two years, focusing on cattle. Johne's 
disease is also endemic in the U.S. sheep population and is not well 
understood as a sheep disease. The same concerns exist regarding food 
safety and other countries are aggressively addressing Johne's in sheep 
regulatorily. We urge the subcommittee to send a strong message to ARS 
that Johne's disease in sheep should receive more attention with an 
emphasis on diagnostics.
    We also strongly support the administration's request for emerging 
diseases and we urge significant appropriations for the animal 
component of this line item.
  cooperative state research education and extension service (csrees)
    We strongly support the National Research Initiative (NRI) and we 
appreciate the Administration's request of $200 million. The 
competitive grants awarded under its program are for the highest 
quality research addressing the goals and objectives of FAIR 1995.
    Ongoing research in wool is critically important to the sheep 
industry. ASI supports continued funding of $212,000 for fiscal year 
2000 through the special grants program of the CSREES.
    We urge the subcommittee to appropriate both intramural and 
extramural funding for research to measure the well being of livestock. 
Animal well being is an emotional issue; in order to consider new 
management strategies for the enhancement of animals, we need improved 
methods of measurement.
    The industry greatly appreciates this opportunity to discuss these 
programs and appropriations important to the sheep industry.
                                 ______
                                 
  Prepared Statement of the American Society for Nutritional Sciences
    The American Society for Nutritional Sciences (ASNS) is the 
principal professional organization of nutrition research scientists in 
the United States representing 3,500 members whose purpose is to 
develop and extend the knowledge and application of nutrition science. 
ASNS members include scientists involved in human as well as animal 
nutrition research. Our members hold positions in virtually every land 
grant and private institution engaged in nutrition-related research in 
the United States as well as industrial enterprises conducting 
nutrition and food related research.
    ASNS wants to express gratitude for the work that this committee 
did last year, on both sides of the aisle, to help increase 
competitively awarded agricultural research in the National Research 
Initiative Competitive Grants Program. Another significant increase in 
fiscal year 2000 for the NRI would help set the course for providing 
increased emphasis in the critically emerging areas such as genomics 
and genetics. While genomics is being studied under NIH and NSF funded 
grants, they have not addressed the areas of the genetic influence on 
nutrient requirements of individuals, nutrient gene interactions, and 
nutrient metabolism on the genetic basis of diseases in their 
intramural grants programs. These areas easily fit into the purview the 
of USDA's NRI mission. ASNS supports these and other key elements that 
will enhance cross-cutting areas of nutrition research having broad 
health outcomes.
    The President's Budget for fiscal year 2000 calls for a net 
increase of $81 million above fiscal year 1999 funding for the NRI. We 
strongly endorse this substantially needed investment.
    While we endorse the proposed increase, we do not believe that the 
President's budget supports the original intended priorities outlined 
in Section 401 of the Agricultural Research, Extension and Education 
Reform Act (AREERA) of 1998 for the Initiative for Future Agricultural 
and Food Systems. The President's Budget has transposed these 
priorities into the NRI. We know there are concerns from this Committee 
and the Congress about the new competitive grants programs. At this 
time we offer some suggestions as to how USDA's CSREES may incorporate 
such an increase so that the funds are effectively managed for the best 
possible health research outcomes. ASNS encourages Congress to urge 
department officials to consider administering all ongoing and new 
initiatives through a centralized office. This allows new grant 
administrators to take advantage of the investment and experience of an 
established program. ASNS stresses that the NRI use the model of other 
federal agencies that have more than one review cycle per year. Two or 
three cycles per year would allow for timely resubmission and encourage 
institutions to provide bridging funds for quality programs. Currently 
only 25 percent of qualified grants receive funding. Inadequate funding 
limits the productivity of researchers that the NRICGP is able to fund. 
NRI awards are small, averaging $133,210 in fiscal year 1998, and 
short, averaging 2.2 years for a total average support of about $60,000 
each year. Additionally a 14 percent cap on indirect (facilities and 
administrative) costs deters many capable investigators from seeking 
NRI grants. These caps are detrimental and we urge you to reexamine the 
14 percent cap on indirect costs.
    A recent report from the National Association State Universities 
and Land Grant Colleges (NASULGC) stated that research and development 
funding for space exploration, the environment, basic science research, 
and health research has increased in constant dollars from 23 to 58 
percent over the last ten years. But during this same time period, the 
funding for agricultural research and extension programs, the lifeblood 
of our food supply system, has shrunk by eight percent in constant 
dollars. Base funds have eroded by 16 percent. These funds support the 
scientists and extension educators who can respond quickly and 
effectively to unexpected problems that arise for producers and 
consumers. The benefit is a food system that enables the consumer 
dollar and the welfare family's food stamps to purchase inexpensive, 
safe, and nutritious food. A food system that creates jobs, competes 
worldwide, and conserves its natural resources base.\1\
---------------------------------------------------------------------------
    \1\ Investments that Make a Difference, National Association of 
State Universities and Land-Grant Colleges, Fiscal Year 2000 Budget 
Proposal.
---------------------------------------------------------------------------
                 research funding mechanisms and issues
Competitive Grants
    A competitive system for allocating government research funds is 
the most effective and efficient mechanism for focusing efforts on 
cutting edge research aimed at improving the health of the American 
people. Competitive grants provides the most effective, efficient and 
economic return to the public. ASNS strongly supports the competitive 
grants process as reflected in the National Research Initiative and 
believes that an open, merit and peer review process, applied as 
extensively as possible throughout the research system, is the best way 
to distribute research funds among qualified scientists.
Special Grants
    ASNS strongly believes that the best research results come from 
research that is peer reviewed. That is why researchers funded by 
federal agencies, such as the NIH and the NSF, that award grants on 
merit have made such great progress. There is a potential danger that 
special grants and earmarked research funds from USDA may be awarded on 
the basis of politics rather than merit, priority or research need. 
Therefore, the perception might be that the integrity of the research 
system and agricultural science is undermined. Last year special grants 
were appropriated at $78 million even though the Administration's 
request for this year was less than half of that figure. We recognize 
that there is pressure to maintain these special grants. While special 
grants have their place to address emergency needs of national priority 
such as food safety, they may also be used to address research that is 
not deemed of the highest priority or merit. Thus, the proportion of 
special grants in comparison to the total research budget at USDA 
should be decreased.
Initiative for Future Agriculture and Food Systems
    The Initiative, despite being signed into law, had no funds 
appropriated for fiscal year 1999. The legislation, calls for priority 
mission areas to be addressed: food genome; food safety; food 
technology and human nutrition; new and alternative uses and production 
of agricultural commodities and products; agricultural biotechnology; 
and natural resource management. The Initiative also includes 
provisions that allow merit/peer review and lets those who benefit from 
agricultural research provide input about the priority setting process. 
ASNS supports this Initiative and urges members of this sub-committee 
make it a funding priority.
National Needs Initiative
    Another important area where funding has remained stagnant is the 
National Needs Initiative (NNI) of the Graduate Fellowship Program at 
the Higher Education Office of the USDA. This program fills an 
important need to help train the next generation of agricultural 
researchers. Despite its importance, funding for the NNI has seen a 
dramatic decline in recent years. ASNS supports the FASEB 
recommendation of $5 million for the NNI so that it may be restored to 
its previous funding levels. We also support the review and subsequent 
reorganization of USDA-sponsored graduate training.
                the need for nutrition-related research
    The need for nutrition science and research is critical within the 
USDA. Nutrition and agricultural research are areas that impact the 
constituents of every congressional district in the nation. New 
technologies are demanded to reduce the likelihood of pathogen 
transmission by food, to improve the quality of processed foods, and to 
deliver greater nutritional value in foods. Additionally the economic 
impact on society in healthcare costs produced by advances in nutrition 
research is significant in the number of dollars saved by the American 
taxpayer. As health costs continue to rise, it is imperative that our 
medical practices take a preventive approach. This requires a thorough 
understanding of the role of nutrients in foods in preventing chronic 
illnesses such as heart disease, cancer and diabetes.
    The USDA has a unique role in the area of nutrition research, 
particularly as it applies to human nutrition. For example, although 
there is a serious and obvious commitment to the funding of disease-
related research within the National Institutes of Health, issues 
important to the basic mechanisms of nutrient function and the safety 
of the food supply have traditionally been the purview of USDA funded 
research. Most of the recent work on nutrient content and availability 
in various foods has come from USDA-NRI supported research. From a 
consumer perspective, it is this type of information that is often the 
most useful.
                      food security and behaviors
    A 1994 Institute of Medicine Report stated that reducing foodborne 
illness will require research in all aspects of the food system, from 
production to consumption.\2\ For example, identifying the foods most 
involved in foodborne illnesses, characterizing new foodborne 
pathogens, and developing new monitoring protocols are some ways to 
detect pathogens or toxicants responsible for outbreaks and minimize 
their impacts. Studies are also needed to identify food behaviors and 
nutritional effects in relation to more vulnerable populations such as 
infants and the elderly. Also, knowing more about health protectants 
will enable individuals to maximize the nutrition and ``healthfulness'' 
of their food choices relative to the prevention of disease. The need 
also exists to better understand the biology and behavior of food 
choices. Here we also need to study consumption related to risk 
analysis which demands better data on food consumption.
---------------------------------------------------------------------------
    \2\ Opportunities in the Nutrition and Food Sciences, Institute of 
Medicine, 1994, p. 111.
---------------------------------------------------------------------------
                      biotechnology and nutrition
    Increased interest in enhancing the nutritional quality of the food 
supply has sparked ways to design foods not just for disease prevention 
but also for health promotion. For example, opportunities exist to 
influence food habits and food choices, by using technology to enhance 
healthful foods.
    Ultimately we will want to know what compositional changes in crop 
plants have the best nutritional value. There are many basic questions 
left unanswered on the role of diet in health and disease when it comes 
to phytonutrients in plants.
    USDA is encouraged to collaborate with other federal agencies in 
the area of nutrition whenever possible. This objective naturally spans 
research done in both the USDA and NIH.
                         genetics and nutrition
    Studying genetic interactions will allow us to address several 
issues at once. For example, what intakes of nutrients are needed to 
achieve optimal health and minimal risk of various diseases associated 
with diet? Do requirements differ depending on genetics? How do 
genetics influence efficiency of metabolism and does this affect 
nutrient requirements? What are metabolic and health consequences of 
inadequate nutritional status, as affected by genetics? Many research 
opportunities exist in this area.
                         genomics and nutrition
    ASNS supports a recent report from the Federation of American 
Societies for Experimental Biology that states, increased funding 
should bring an emphasis on all aspects of genomics. Such an initiative 
would significantly enhance existing programs within the NRI. One 
example might be functional genomics. ASNS has provided detailed 
scientific background about this kind of research to USDA program 
directors at a recent stakeholders meeting.
    Research and resources devoted to unraveling the genomes of a few 
selected organisms have been expanding dramatically in recent years. 
While the administration of large-scale programs has been placed in 
agencies other than USDA, the power and long-term impact of a large-
scale genome initiative directed toward agriculturally important 
organisms-including animals, plants, and microbes (plant, animal and 
human pathogens)--represents a major opportunity and fulfills an 
important need in agriculture.
    USDA's NRICGP is well positioned to use genomic data to address 
programs in agriculturally important organisms. However, given its 
present budget--and even with the most optimistic incremental 
increases--the NRICGP currently lacks the resource depth to meet this 
challenge. ASNS endorses the allocation of at least $50 million in new 
money to be directed toward an agricultural genomics program.\3\
---------------------------------------------------------------------------
    \3\ Federal Funding for Biomedical and Related Life Sciences 
Research Fiscal Year 2000, Federation of American Societies for 
Experimental Biology, 1999, p. 53-54.
---------------------------------------------------------------------------
                           animal welfare act
    Research using animals has been crucial to virtually every advance 
in medicine in the past century. Agents for control of high blood 
pressure and the management of diabetes, vaccines for the control of 
poliomyelitis and mumps, development of artificial joints and heart-
lung machines, and many more medical advances have depended on animal 
research.
    USDA's Animal and Plant Health Inspection Service (APHIS) is 
charged by Congress to enforce the Animal Welfare Act (AWA). Under the 
AWA, USDA licenses dealers to buy and sell random-source animals to 
research facilities that are unable to obtain them from municipal 
pounds and shelters. This provides access to a critical supply of 
animals since animals bred specifically for research often lack 
characteristics needed by researchers studying health-related problems. 
Much of their work relies on older, larger, and genetically diverse 
animals.
    ASNS recommends that Congress provide APHIS with adequate funding 
for enforcement of the Animal Welfare Act in fiscal year 2000 so that 
it can continue to ensure compliance with the AWA.
    Most recently an issue has emerged that will impact researchers and 
their institutions using rats, birds, and mice. ASNS strongly opposes a 
proposal to include rats, mice, and birds as part of the USDA 
regulatory efforts under the AWA. At this time the vast majority of the 
rats and mice used in research in the United States are in institutions 
that follow the guide for the Care and Use of Research Animals, the 
guidelines published by the Institute of Laboratory Animal Research 
(ILAR) of the National Academy of Sciences. With its limited resources 
in USDA's APHIS, the burden of adding rats, mice, and birds to its 
responsibilities would have a negative effect on overall AWA 
enforcement. This increased regulatory burden imposed on researchers 
and their institutions by introducing redundant regulations will have a 
detrimental effect to the efforts of the research being conducted. If 
this regulation is expanded to require new responsibilities, APHIS will 
need several million more dollars each year to extend its AWA coverage 
to rats, birds and mice. ASNS feels such allocations of funds are not 
in the public interest. Such resources could be more effectively used 
elsewhere within the USDA's competitive research grants program.
                               conclusion
    Agriculture is and will continue to be important to human health in 
terms of food that provides proper nutrition for healthier people. As 
the future challenges us with more complicated diseases, research must 
expand outside the traditional disciplines and approaches, such as the 
work that is being done is plant and animal genomics. New approaches 
must be implemented to address new societal concerns. For example, 
despite our hard efforts to plan healthy diets for school children much 
of this food is being wasted. Nutritionists are constantly challenged 
to develop nutrient-balanced meals that will encourage our children to 
choose more healthful foods. New demands to fit busy lifestyles is 
another example. Issues such as product convenience, uniformity of 
products, ease of preparation, ``automatic'' nutrient balancing, and 
packaging are all areas scientists must address. Research in areas of 
how our food is produced, pesticide usage, animal care and food 
handling issues also present demands to our scientists. These demands 
and opportunities must be answered in a way that sustains or enhances 
our quality of life. Although greater challenges lie ahead, 
agricultural research funding continues to have slow growth despite 
significant increases at other research agencies such as the NIH and 
NSF.
    It is for these reasons that ASNS reiterates the following 
recommendations to the sub-committee:
  --Increase funding for USDA's NRICGP from $119 million to $200 
        million, of which $50 million will be used for a genomics 
        initiative.
  --ASNS recommends $120 million for the Initiative for Future 
        Agriculture and Food Systems in which human nutrition research 
        remains a research priority.
  --Provide an increase of $5 million to the National Needs Initiative 
        so that it may be restored to its previous funding levels.
  --Reexamine the 14 percent cap on indirect (facilities and 
        administrative) costs in NRI grants.
                                 ______
                                 
 Prepared Statement of the Association of Research Directors 1890 Land-
                           Grant Universities
    Senator Thad Cochran, Chairman, and other distinguished members of 
the Committee, my name is Samuel L. Donald, Regional Research Director 
for the seventeen Historically Black 1890 Land-Grant Universities, 
including Tuskegee University (hereafter referred to as the 1890s). Mr. 
Chairman, I submit, on behalf of the 1890 community, this written 
testimony in support of the fiscal year 2000 Budget recommendations for 
the 1890s.
                          general information
    Mr. Chairman, today, the rich legacy of the land-grant tradition 
remains prominent on the campuses of the 1890s. These institutions are 
increasingly serving as economic instruments of the state and the 
nation. They have their extraordinary influence on the lives of all 
citizens including African Americans and other minority groups. While 
enduring inequities in state and federal funding, the 1890s serve as 
exemplary role models; provide educational access to those who may 
otherwise be denied the opportunity to pursue a college education; and 
foster an unyielding commitment to academic excellence, social equality 
and the assurance of a decent future for all students including those 
from the lowest economic strata of the nation. These universities have 
been in the forefront of educating youth-at-risk, producing research 
vital to the quality of life and the environment, and addressing the 
social and economic needs of urban and rural communities. Teaching, 
research and extension remain prominent on the campuses of the 1890s.
                      accomplishments and impacts
    Historically Public Black Colleges and Universities (HPBCUs) 
constitute some of the largest and most prestigious institutions of 
higher education in the nation. Among them, two of the largest are 1890 
HPBCUs. Several of the 1890s offer doctoral degrees and/or professional 
degrees in engineering, food science, toxicology, environmental 
science, and other areas of national need. Three of the top five HPBCUs 
in the nation contributing to the production of African American 
doctorates are 1890s. Annually, six HPBCUs produce nearly 20 percent of 
all African American bachelor degree recipients in engineering and the 
1890s graduate over 80 percent of all Black recipients of bachelor 
degrees in agricultural sciences. Tuskegee University alone has trained 
more than 80 percent of the nation's Black veterinarians. The 1890s 
depend heavily on federal support for sustaining their academic, 
research, and extension programs. These institutions contributions to 
science and other accomplishments are reasons for maintaining and 
expanding the federal partnership. For the purposes of improved food 
quality and food safety, improved and sustained agriculture production, 
improved quality of life for rural people, etc., some of the more 
recent accomplishments of the 1890s are:
  --Tested water samples from wells of rural families for nitrates and 
        pesticides residues.
  --Determined soil loss coefficients for fruits and vegetables.
  --Developed new invitro systems for enhancing root system development 
        of pine and hardwood trees.
  --Found that increased production of rapeseed will provide an 
        efficient domestic source of erucic acid oil, reduce expensive 
        imports of rapeseed oil, help control environmental pollution 
        resulting from use of inorganic pesticides, and assist in the 
        development of sustainable crop production.
  --Found that N-methyl aspartate enhanced growth and reduced fat in 
        swine and chickens.
  --Demonstrated that gamma irradiation of broilers eliminated 99 
        percent of microbial contamination.
  --Found that self-rating by 9-12 grade students in 19 rural schools 
        mirrored the reward systems in the schools.
  --Developed Simmental cattle with a high rate of twinning.
  --Determined that lambs and kids produced on cowpeas are lean and low 
        in fat and preferred by consumers.
  --Developed a simplified field test for water engineers and seafood 
        producers and processors of two major flavor contaminants.
  --Developed a new vegetable-legume cropping system for small-scale 
        farmers in the Southeast.
  --Established seed and tissue culture systems to grow peanut and 
        sweet potato invitro.
  --Developed a screening system to detect aflatoxins in peanut.
  --Developed a database that provides information used by the swine 
        industry, agencies and educational institutions.
  --Demonstrated a direct relationship between diet and exercise on 
        hypertension and diabetic African American women.
  --Determine that dietary omega-3 polyunsaturated fats have beneficial 
        properties to change physical and biochemical processes to 
        control blood pressure.
  --Developed technology to improve goat meat and fiber production.
  --Developed intensified ``Farm Planning Program'' for farmers to 
        improve profitability from crops, livestock, and alternative 
        farm enterprises.
  --Assisted fish farmers to develop viable aquaculture operations.
  --Conducted senior citizens conferences on consumer fraud, security, 
        energy conservation, and modification of dwellings for 
        handicapped use and access.
    The above accomplishments had major impacts on improving (a) the 
quality of lives of people served and (b) the entrepreneurial skills 
and farming operations of farmers served. The bottom line is, due 
primarily to federal appropriated dollars to the 1890s, many under-
served clientele, customers and stakeholders have a ``brighter'' 
tomorrow.
                         budget recommendations
    The 1890s support the fiscal year 2000 budget recommendations of 
the National Association of State Universities and Land-Grant Colleges 
(NASULGC) which emphasizes modest increased funding for the research, 
extension, and academic programs. This is especially the case for 
formula/base funded programs, that is, a requested 6-8 percent increase 
not a decrease as recommended in the President's budget. Mr. Chairman, 
the 1890s urge the Committee to strongly support the NASULGC 
recommendations which includes the following for the 1890s:
Evans-Allen Research Program ($31.976 Million)
    The 1890s request a marginal increase in base funds for research. 
These funds will enhance the capacity of these institutions to become 
more competitive in the private sector and in domestic and 
international research endeavors designed to undergird the vitality of 
the nation's agricultural enterprise. This support will enhance the 
ability of the 1890s to compete for grants and contracts in a wider 
variety of programs in the U.S. Department of Agriculture, other 
federal agencies, and the private sector.
Capacity Building Grants Program ($10 Million)
    The Capacity Building Grants Program is making a major difference 
in the quality and quantity of teaching and research programs in food 
and agricultural sciences and technology on the campuses of the 1890s. 
Since the creation of this enormously important program, the 1890 
leadership has strongly advocated a substantial and sustained increase 
in funding at more than $25 million annually. This level of funding 
would allow these institutions to significantly improve the range and 
level of academic programs offered, enhance the performance and 
productivity of faculty in the sciences and increase research 
opportunities for undergraduate and graduate students. However, 
consistent with the NASULGC's recommendation, the 1890s support the 
request of $10 million.
Extension and Research Facilities Grants Program ($12 Million)
    The 1890s unequivocally support the $12 million facilities funding 
request in the NASULGC as well as the President's budgets for 
renovation, maintenance and overall improvement of the infrastructure 
on our campuses. The 1890s face nearly insurmountable barriers in 
attracting public and private support for enhancement of facilities. 
Although this level of funding will not fully address the critical 
facility needs of our institutions, it will complement existing efforts 
to make major improvements.
Extension Program ($27.943 Million)
    The 1890s support a modest increase in base funding requested by 
NASULGC for extension activities. This marginal increase will allow our 
institutions to sustain program activity at current levels and respond 
more efficiently to the growing demand for services in severely 
depressed and under-served communities.
                            closing comments
    Mr. Chairman, based on past accomplishments and visionary approach, 
the 1890s are positioning themselves to enter the 21st Century with a 
renewed commitment and capacity to implement their land-grant mission 
of teaching, research and extension. Full appropriations of the fiscal 
year 2000 budget recommendations as stated above will facilitate this 
and is vital to the 1890 Land-Grant Universities. If there is a need 
for additional information, you may contact me as indicated below.
                                 ______
                                 
 Prepared Statement of the ASTA Corn & Sorghum Basic Research Committee
                                summary
    We are requesting $500,000 be appropriated annually for enhancing 
corn germplasm.
    1. Corn is a key resource providing food, industrial uses, 
livestock feed, and export.
    2. Corn production in the U.S. is based on less than 5 percent of 
corn germplasm available in the world. Broadening the germplasm base 
would provide genes to improve yields and protect against new disease, 
insect and environmental stresses. Exotic germplasm would also be a 
source for changes in grain quality being demanded by export markets, 
industrial processors, and other end users.
    3. Most exotic germplasm is unadapted to growing conditions in the 
U.S. This proposal is a joint USDA/ARS, university, and industry effort 
to adapt this material, so that it can be used by commercial breeders 
in the development of new hybrids to meet the demands of the American 
consumer and our foreign markets.
    4. We greatly appreciate the $500,000 previously appropriated for 
this research, beginning with the 1995 federal budget. This funding is 
supporting the two main USDA/ARS locations involved in this research 
(Iowa and North Carolina), as well as USDA/ARS and university locations 
in Delaware, Illinois, Iowa, Missouri, Ohio, New York, Tennessee, Texas 
and Wisconsin. Industry is providing $450,000 in-kind support annually 
for this effort.
    5. The additional appropriation of $500,000 annually would enable 
the Iowa and North Carolina locations to purchase equipment and add 
staff necessary for carrying out this research. It would also provide 
funding for the increased germplasm evaluation and breeding necessary 
to test and enhance the exotic materials available.
                               background
    Corn is the major crop on the cultivated land of the USA where 
approximately 75 million acres are planted each year. U.S. corn 
production, accounting for about half of the world's annual production, 
adds over $16 billion of value to the American economy as a raw 
material. About 20 percent ($3.2 billion) of this production is 
exported each year, thereby providing a positive contribution to the 
nation's trade balance. Approximately 17 percent of the yearly corn 
crop is industrially refined. A portion of the refined products is 
exported resulting in an additional $1.4 billion in export. Through 
feeding livestock, the rest of the crop is processed into meat and 
dairy products that affect everyone in our society. Corn is a key 
resource within our country.
                                concerns
    All of this production is based on using less than 5 percent of the 
corn germplasm available in the world. Less than 1 percent of our 
commercial corn is of exotic (foreign) origin, and tropical exotic 
germplasm is only a fraction of that. This situation exists because 
private sector corn breeders have generally concentrated on genetically 
narrow based, or elite by elite, sources for their breeding efforts, 
since their use results in getting hybrids to the marketplace faster.
    Traditionally, corn has been treated as a commodity. In recent 
years corn grain users and processors have become more interested in 
the quality characteristics of the grain itself and how this affects 
their business. Since much of the exotic germplasm has undergone 
selection for many indigenous uses (foods, beverages, etc.) by various 
cultures, it seems likely that new grain quality characteristics will 
be found in exotic germplasm rather than the narrow-based germplasm now 
used. A small increase in value to the grain, such as 10 cents per 
bushel, would increase its annual value by $800 million for an eight 
billion bushel harvest.\1\
---------------------------------------------------------------------------
    \1\ Salhuana, Pollak, Tiffany 1994. Public/Private Collaboration 
Proposed to Strengthen Quality and Production of U.S. corn through 
Maize Germplasm Enhancement, Diversity Vol. 9, No. 4, 1993/Vol. 10, No. 
1, 1994.
---------------------------------------------------------------------------
    Breeders must still be concerned with breeding for higher yields so 
that U.S. corn farmers can remain competitive. Tapping into the broader 
germplasm pool could provide new sources of genes for higher yield and 
other performance traits, such as disease and insect tolerance or 
improved stalk and root strength.
    A further concern with a narrow genetic base is the potential for 
widespread disease or insect damage due to new diseases or insect 
species spreading into U.S. corn growing areas. It is more likely that 
resistance to these dangers would be found in genetically diverse 
exotic germplasm sources than in our breeding material. One major 
benefit would be reduced pesticide use. In addition to protection 
against diseases and insects, these exotic materials provide insurance 
for unforeseen climatic or environmental problems.
    A great deal of excitement has been generated over the new 
techniques of biotechnology, especially over the potential value to the 
corn industry of gene transformation using genetic engineering. 
Research conducted on exotic germplasm could yield many beneficial 
genes that genetic engineers could quickly transfer to commercial 
hybrids.
                              lamp project
    What would be the source of this exotic germplasm? Over the years, 
collections of corn have been made from farmers' fields and other 
sources all over the world, and are stored in various germplasm banks. 
In 1987, the Latin American Maize Project (LAMP) was initiated to 
evaluate these corn collections (accessions). It was a cooperative 
effort among 12 countries to identify accessions that might provide 
valuable source material for further improvement in hybrid and open-
pollinated cultivars in the U.S.A. and other areas. Pioneer Hi-Bred 
International gave USDA/ARS $1.5 million to fund the LAMP research.
    Nearly 12,000 maize (corn) germplasm accessions were evaluated. In 
successive stages, the project identified the top 268 accessions. The 
environmental areas of adaptation for these 268 ``elite'' populations 
range from temperate to tropical, and are prime candidates for 
enhancing the U.S.A. corn germplasm base.
                         germplasm enhancement
    Most of this germplasm is unadapted to growing conditions in the 
U.S. and requires genetic enhancement to make it adapted, or able to 
grow and mature in our environmental conditions. Enhancement basically 
means that these exotic materials will be bred with U.S. adapted 
materials and breeders will select progeny that carry the desired 
exotic traits and are also adapted to U.S. growing conditions. This 
will require a concerted long-term breeding approach by corn breeders 
at numerous locations (environments) throughout the U.S. Only after 
this process of enhancement will these exotic materials be ready to 
enter commercial corn breeding channels and be effectively utilized by 
a broad cross-section of the industry in the development of new hybrids 
for farmers and corn users.
    The total process of enhancement is too large and long-term for 
public institutions and/or seed companies to accomplish individually. 
An ambitious task of this nature can only be completed through a 
coordinated and cooperative effort between the USDA/ARS, land-grant 
universities, and industry.
    The Corn and Sorghum Basic Research Committee of the American Seed 
Trade Association has been concerned that enhancement of this exotic 
germplasm would proceed. The Committee consists of representatives from 
about 30 companies actively involved in the corn and sorghum seed 
industry, and at the committee's request, Dr. Linda Pollak, Research 
Geneticist, USDA/ARS, et al, developed a proposal for enhancing exotic 
germplasm starting with materials which will include the elite LAMP 
accessions as noted above. This proposal has developed into the U.S. 
GEM (Germplasm Enhancement of Maize) Project.
                        u.s. gem project outline
    Since this project serves a national need, the primary effort and 
direction has come from the USDA/ARS. Two permanent USDA/ARS locations 
are being used as primary sites for enhancement breeding and 
coordination. One is in Ames, Iowa, where the USDA/ARS currently 
conducts corn evaluation and enhancement efforts. Dr. Linda Pollak, 
Research Geneticist, is located there. Dr. Pollak was the Principal 
Investigator of the U.S.A. for LAMP, and is the lead scientist for this 
project.
    The other permanent site is the USDA/ARS location in North 
Carolina. This site has responsibility for initial evaluation and 
conversion of the tropical materials. Tropical corn populations 
normally will not reach maturity in the Corn Belt, but will produce 
seed in North Carolina. After initial enhancement of the tropical 
materials in the South, they will be sent to Ames for further 
enhancement and testing in Corn Belt conditions. Dr. Marty Carson is in 
charge of this program.
    A number of corn researchers at various land-grant universities and 
other ARS locations are also taking part in the enhancement and 
evaluation of this exotic germplasm. This cooperative effort is very 
important and serves not only as a source of improved germplasm but 
also provides excellent training for future plant scientists.
    Industry is also involved. A total of 23 companies have pledged 
research nursery and yield trial plots to be used in this breeding 
effort. This in-kind support is valued at $450,000 per year.
    An important component of the project is an annual meeting of all 
cooperators to evaluate progress and plan strategies. An information 
network has been established to keep everyone up-to-date. A U.S. GEM 
Technical Steering Group consisting of members from USDA/ARS, 
University, and Industry has been formed for guidance and 
administration of this cooperative effort.
    This germplasm enhancement project is public and is open to all 
public sector institutions as well as private seed companies. 
Information will be freely available and publicly developed materials 
will remain in the public domain, accessible to all.
                       accomplishments 1996-1998
    Following is a description of accomplishments and research 
conducted at various locations using 1996-1998 funding.
    Ames, Iowa.--Priorities for the corn enhancement work at this 
location are overall project coordination, data analysis and 
management, management and release of enhanced germplasm, analysis of 
materials for value-added traits, and as one of the many breeding 
sites. To date, 200 hybrids from crosses with GEM breeding lines have 
beaten the average of commercial check hybrids in trials analyzed in 
Ames.
    The laboratory is continuing to evaluate oil, starch, and protein 
in the exotic accessions and in the breeding populations made up of 
exotic materials crossed to proprietary corn belt inbreds. In results 
from 1996, a line from one breeding cross measured total protein of 16 
percent (corn belt germplasm has 10 percent) and total oil level of 6 
percent (corn belt is 4 percent). It is extremely unique to find 
increased levels for both of these traits in the same line, and it is 
potentially very useful for food and feed applications. In 1997, lines 
were identified with unique starch characteristics, which may be 
beneficial for human food products. In 1998, three lines were 
identified with high percent retrogradation, which may have 
applications as a new source of dietary fiber or as a dry lubricant. 
Other lines were found to exhibit certain potentially useful traits, 
such as low protein (5.1 percent), high protein (15.4 percent) and high 
starch content (73.6 percent).
    GEM's World Wide Web site opened on July 15, 1996. From this site 
cooperators can obtain the latest data from yield tests, disease and 
insect screening, and value-added trait research, as well as news and 
upcoming events.
    Raleigh, North Carolina.--The focus of this location is twofold. 
One priority is to develop enhanced material adapted to the Southern 
U.S. corn growing conditions. The second is to be a stepping stone for 
adapting tropical material to Midwest conditions.
    Breeding populations were tested for resistance to various leaf 
diseases and stalk rots. Selections were made for improved material 
with resistance to these diseases as well as for improved yield, 
standability, and adaptation to North Carolina conditions. For example, 
in 1997 significant resistance to Fusarium ear rot was found in four 
GEM breeding populations. Resistance to Aspergillus ear rot was also 
found in two of these same four populations. Hybrids of about 55 
advanced breeding lines developed from tropical by elite breeding 
populations yielded equal to or outyielded the mean of commercial check 
hybrids over two years. These lines are now candidates for release.
    Other public cooperators conducted evaluations in 1998 as follows: 
Drought resistance in Delaware. Yield data accumulation in Georgia, 
North Carolina, Maryland, Tennessee, Kentucky Missouri, Texas and 
Delaware. Grain yield and disease resistance in Illinois. Fusarium ear 
rot resistance in Iowa. Zein content, wet milling properties, starch 
functionality, and other value added grain traits in Iowa. Resistance 
to corn rootworm and corn borer in Missouri. Resistance to anthracnose 
stalk rot in New York. Breeding in Tennessee. Evaluation of silage 
quality in Wisconsin.
    Demonstration nurseries were planted at Iowa and North Carolina for 
viewing by cooperators. Fall field days were held at Iowa and North 
Carolina.
    In 1998, private cooperators continued the breeding and adaptation 
of about 15 accessions following the protocol developed by the GEM 
Technical Steering Group. Companies increased their nursery and yield 
trial in-kind support by approximately 25 percent in 1996.
                            research in 1999
    Research will continue at the various USDA/ARS, university, and 
company locations similar to 1998.
             effects of increased funding beginning in 2000
    Appropriation of the additional $500,000 annually would provide 
funds to increase research in the following ways:
    Ames, Iowa.--The addition of a database manager (GS-11) would allow 
GEM to meet the increasing demand for value added trait and other data 
from the GEM project, and link this data with genomic data, benefiting 
the Corn Genome Project. Continuation of the postdoctoral position for 
value added trait research would provide for the study of food 
technology aspects of the unique traits being discovered. A graduate 
research assistant would study the inheritance of these value added 
traits, developing invaluable information for the breeding effort. By 
nearly tripling the amount for public cooperators, it would greatly 
enhance the data gathering and adaptation breeding of these materials.
    Raleigh, North Carolina.--This location has a number of equipment 
needs, such as a seed storage unit, because current facilities are 
filled to capacity and a minivan for transportation (see ``Budget'' 
document). A technician would be added to handle the expanded field 
work. Current resources restrict testing and development work to 
relatively few breeding populations. With the increased funding, the 
number of breeding crosses could be increased, greatly speeding up the 
introduction of adapted GEM material into private and public breeding 
programs. Additional funding would provide for yield trial testing at 
more locations and more extensive disease and insect resistance 
screening, greatly increasing the precision in selecting materials that 
are high yielding and have high levels of pest resistance.
    Other Public Cooperators.--The increase in funding for public 
cooperators would allow for full evaluation and development of new 
breeding materials improved for productivity as well as disease and 
insect resistance and value-added traits. It would also provide for the 
use of biotechnology tools in this development work. Most public 
cooperators are willing to participate, but cannot unless they have at 
least partial funding. There are approximately 30 public cooperators 
now, and as the project develops we are likely to have more.
                               conclusion
    Corn hybrids in the U.S. have a very narrow genetic base, utilizing 
only a small percentage of all available corn germplasm. This greatly 
increases vulnerability to unforeseen pest problems, and may lead to an 
eventual yield cap. Exotic corn germplasm could provide genes for 
resistance to pest problems and for increased yields. These exotic 
materials may also contain quality traits to meet new market demands. 
This will help ensure the U.S. maintains its world leadership in 
providing the best raw materials to meet the demand for the production 
of meat, eggs, milk, and many other food and industrial uses.
    The LAMP project identified the top 268 corn accessions from among 
12,000 populations evaluated. The present proposal represents a joint 
USDA/ARS, land-grant university, and industry effort to enhance these 
and other exotic accessions so that they can enter commercial corn 
breeding programs. The result of this cooperation will be an increase 
in the productivity, quality, and marketability of hybrid corn in the 
U.S. and for export, benefiting the farmer, the feed and processing 
industries, and the consumer.
    Therefore, the ASTA Corn and Sorghum Basic Research Committee 
hereby requests the 106th Congress of the United States to add funding 
of $500,000 (in addition to the $500,000 appropriated initially in 
1997, for a total of $1,000,000) annually for this corn germplasm 
enhancement project beginning with the 2000 federal budget.
                             budget summary
    This is a summary of the operational and capital budgets for 1999, 
2000, and 2001; 2001 will only be operational. The budget is divided 
into the Corn Belt Location and corresponds to Ames, Iowa (USDA-ARS) 
and the cooperators in the Corn Belt area. The Southern Location 
corresponds with Raleigh, North Carolina (USDA-ARS) and the cooperators 
in the states in the South. For a complete copy of the budget, please 
contact Dr. David Harper, Holden's Foundation Seeds LLC, Box 839, 
Williamsburg, IA 52361 or 319-668-1100.

----------------------------------------------------------------------------------------------------------------
                              Items                                    1999            2000            2001
----------------------------------------------------------------------------------------------------------------
                       Corn Belt Location
 
Board Reductions................................................         $19,100         $20,105         $21,185
Personnel.......................................................         164,550         243,990         312,832
Office/Field....................................................          44,900          85,125          89,381
Capital Equipment...............................................          11,450          81,780           7,602
Specific Agreements for Public Cooperators \1\..................          60,000         169,000         169,000
                                                                 -----------------------------------------------
      Total for Corn Belt Location..............................         300,000         600,000         600,000
 
                        Southern Location
 
Personnel.......................................................          68,200         111,600         114,000
Indirect Costs..................................................          16,213          13,363          13,363
Office/Field....................................................          30,587          45,037          46,637
Capital Equipment...............................................           5,000          65,000          41,000
Specific Agreements for Public Cooperators \1\..................          30,000          65,000          85,000
                                                                 -----------------------------------------------
      Total for Southern Location...............................         150,000         300,000         300,000
 
                             SUMMARY
 
Corn Belt Location..............................................         300,000         600,000         600,000
Southern Location...............................................         150,000         300,000         300,000
USDA/ARS Overhead...............................................          50,000         100,000         100,000
                                                                 -----------------------------------------------
      Grand Total...............................................         500,000       1,000,000      1,000,000
----------------------------------------------------------------------------------------------------------------
\1\ Specific Agreements for Public Cooperators: Agreements for public cooperation can be made with universities
  and ARS scientists in many locations which could include the following states: Delaware, Ohio, Pennsylvania,
  Indiana, Illinois, Wisconsin, Kentucky, Missouri, New York, Iowa, Michigan, Minnesota, North Dakota, South
  Dakota, Nebraska, North Carolina, Mississippi, Georgia, Louisiana, Texas and Tennessee. Research at these
  locations would include selection for disease and insect resistance, evaluation for value added traits, and
  yield trials.

                                 ______
                                 

Prepared Statement of the California Industry and Government Coalition 
                            on PM-10/PM-2.5

    Mr. Chairman and Members of the Subcommittee: On behalf of the 
California Industry and Government Coalition on PM-10/PM-2.5, we are 
pleased to submit this statement for the record in support of our 
fiscal year 2000 funding request of $436,500 (one-half of the 
historical baseline split of $873,000 between California and 
Washington) from CSREES, for the California Regional PM-10/PM-2.5 Air 
Quality Study.
    The San Joaquin Valley of California and surrounding regions exceed 
both state and federal clean air standards for small particulate 
matter, designated PM-10/PM-2.5. The 1990 federal Clean Air Act 
Amendments require these areas to attain federal PM-10/PM-2.5 standards 
by December 31, 2001. Attainment of these standards requires effective 
and equitable distribution of pollution controls that cannot be 
determined without a major study of this issue.
    According to EPA and the California Air Resources Board, existing 
research data show that air quality caused by the PM-10/PM-2.5 problem 
has the potential to threaten the health of more than 3 million people 
living in the region, reduce visibility, and impact negatively on the 
quality of life. Unless the causes, effects and problems associated 
with PM-10/PM-2.5 are better addressed and understood, many industries 
will suffer due to production and transportation problems, diminishing 
natural resources, and increasing costs of fighting a problem that begs 
for a soundly researched solution.
    PM-10/PM-2.5 problems stem from a variety of industry and other 
sources, and they are a significant problem in the areas that are 
characteristic of much of California. Typical PM-10/PM-2.5 sources are 
dust stirred up by vehicles on unpaved roads, and dirt loosened and 
carried by wind during cultivation of agricultural land. Soil erosion 
through wind and other agents also leads to aggravation of PM-10/PM-2.5 
air pollution problems.
    The agriculture portion of this study is developing specific types 
of information, tools and techniques needed to develop an inventory and 
the management practices that will most likely be part of the control 
strategies. They are: (1) validate method or methods for accurately 
measuring fugitive PM-10/PM-2.5 emission rates from an individual site 
or operation; (2) a method to easily and quickly estimate PM-10/PM-2.5 
emissions; (3) an accurate inventory of fugitive PM-10/PM-2.5 dust 
sources by individual farming operations; (4) validated (field tested) 
best management practices; (5) a clear understanding of significant 
factors that effect PM-10/PM-2.5 emissions; and (6) a workable, 
validated model or models for predicting PM-10/PM-2.5 emission, based 
on operational parameters.
    The primary focus of the short-term objectives is on those soils, 
practices, and conditions presumed to have the highest PM-10/PM-2.5 
emissions. Priority for this work will be focused on the following 
situations, practices, and crops within the study area.
    Almond, Walnut and Fig Harvest: Preparation for harvest; Shaking 
trees; Windrowing; Picking up nuts; and Ambient conditions before and 
after.
    Dairy Industry: Dairy Lagoons; and Livestock Corrals.
    Cotton Harvest: 1Harvesting--1st and 2nd picking; Shredding of 
stalks; Stalk incorporation; and Ambient conditions before and after.
    Feedlots: Feedlot activities.
    Fall/Spring Land Preparation: Deep tillage; Discing; Land planning; 
Bed formation; and Ambient conditions before and after.
    Grain Harvesting: Harvesting; Stubble incorporation; Discing; and 
Burning.
    Land Leveling: Appropriate practices.
    The importance of this study on PM-10/PM-2.5 is underscored by the 
need for more information on how the federal Clean Air Act Amendments 
standards can be met effectively by the business community, as well as 
by agencies of federal, state and local government whose activities 
contribute to the problem, and who are subject to the requirements of 
Title V of the Clean Air Act. There is a void in our current 
understanding of the amount and impact each source of PM-10/PM-2.5 
actually contributes to the overall problem. Without a better 
understanding and more information--which this study is providing--
industry and government will be unable to develop an effective 
attainment plan and control measures.
    Agriculture wants to be a part of the effort to solve this major 
problem, but to do so, we need federal assistance to support research 
and efforts to deal effectively with what is essentially an unfunded 
federal mandate.
    Agriculture and industry, in concert with the State of California 
and local government entities, are attempting to do our part, and we 
come to the appropriations process to request assistance in obtaining a 
fair federal share of financial support for this important research 
effort. In 1990, our Coalition joined forces to undertake a study 
essential to the development of an effective attainment plan and 
effective control measures for the San Joaquin Valley of California. 
This unique cooperative partnership involving federal, state and local 
government, as well as private industry, has raised more than $24 
million to date to fund research and planning for a comprehensive PM-
10/PM-2.5 air quality study. Our cooperative effort on this issue 
continues, and our hope is that private industry and federal, state and 
local governments will be able to raise the final $4.6 million needed 
to complete the funding for this important study.
    To date, this study project has benefited from federal funding 
provided through USDA's, DOT's, DOD's, EPA's, and Interior's budgets--a 
total of $13.3 million in federal funding, including $436,500 from USDA 
(one-half of CSREES amount provided for California and Washington) in 
each of the last four fiscal years. State and industry funding has 
matched this amount virtually dollar for dollar.
    The UC Davis research into the contribution of agriculture to 
airborne PM-10 in the San Joaquin Valley has produced a number of 
interim results. Some of these results have already been incorporated 
into the San Joaquin Valley Unified Air Pollution Control District's 
planning, and additional research efforts have been planned in 
consultation with district personnel.
    The agricultural emissions research is critical to the district's 
efforts to understand and control PM-10 in the valley. The San Joaquin 
Valley is a serious non-attainment area for PM-10 and also experiences 
high concentrations of PM-2.5. The district's strategies toward PM-10 
emissions from agriculture focus on research to identify activities 
that significantly contribute to the PM-10 problem, and then to develop 
feasible methods of controlling emissions from those sources. Without 
this information, the district could be demanded to control 
agricultural sources in ways that may or may not be effective at 
reducing PM-10. Effective control plans are those that actually reduce 
PM-10 concentrations, so that there is some assurance that the cost of 
implementing them is well-placed.
    UC Davis research has produced much better emission factors for the 
harvesting of cotton than were previously available, and has produced 
the only available emission factors to date for harvesting almonds. 
These emission factors were obtained under actual harvest conditions, 
so should be representative of agricultural operations in the San 
Joaquin Valley. UC Davis research has also investigated the emissions 
generated from harvesting figs and walnuts, and the burning of raisin 
trays. For raisin trays, the results indicate that the emissions are 
not significant. For fig and walnut harvesting, the results also show 
that the emissions are not highly significant. Moreover, actions taken 
to reduce almond harvest emissions will be effective at controlling 
emissions from fig and walnut harvesting, as these crops use the same 
harvesting equipment.
    UC Davis has initiated research into the emission of ammonia from 
livestock facilities in the San Joaquin Valley, primarily dairies and 
feedlots. Approximately half of all ammonia emissions in the San 
Joaquin Valley is thought to come from animals. This research is 
significant because ammonia combines with NO in the atmosphere to 
produce fine particles in the PM-2.5 size range. Further, the ammonia 
emissions are not well characterized for the livestock management 
practices prevalent in the San Joaquin Valley, so new information is 
needed. Some preliminary results have been obtained, but they need to 
be confirmed with additional measurements.
    The currently available fugitive dust emission factors approved for 
use by the U.S. EPA rely on the dry silt content of the soil, defined 
as the fraction that passes through a 75 PM sieve. The emission factors 
were developed empirically, and there is scientific disagreement over 
their utility as a predictive tool. UC Davis research is exploring 
other methods of defining the potential of a soil to emit PM-10 and has 
developed laboratory procedures to measure an index of PM-10 emission 
potential in a repeatable manner. Additional research is ongoing to 
develop this as a useful tool.
    The fugitive dust emissions UC Davis has measured from agricultural 
operations so far has relied on physically collecting the dust from the 
plumes on filters. UC Davis has developed a remote sensing LIDAR (light 
detection and ranging) instrument to characterize the extent of a dust 
plume from afar. This instrument has been used successfully in the 
field to collect information on the size and shape of dust plumes. 
Additional research is ongoing to calibrate it and use it to 
quantitatively measure the dust concentrations. The device will be 
particularly useful under conditions when it is not possible to collect 
a valid sample on filters.
    During the coming year, UC Davis will focus on the following 
research areas:
  --Fugitive dust emission from land preparation activities.--Land 
        preparation is common to nearly all agricultural crops in the 
        valley, but the emission factors from this activity are very 
        poorly defined in the current methods. There is tremendous 
        value in developing better emission factors from this activity.
  --Controlled testing of almond harvesting. Almond harvesting is one 
        of the dustiest activities examined to date.--This summer, UC 
        Davis plans to test several different harvesters on the same 
        orchard, including the latest harvester from each of the two 
        companies that produce them, as well as the most commonly used 
        harvester of each manufacturer.
  --Initiate emissions testing of garlic harvesting.--This crop is 
        expanding in the San Joaquin Valley, and is potentially very 
        dusty. A few pilot tests will provide information on how much 
        further this crop should be examined.
  --Emissions from livestock management.--UC Davis has conducted 
        preliminary testing of dust and ammonia emissions from dairies 
        and feedlots; additional research is needed to acquire a valid 
        database for analysis.
    The support of the Department of Agriculture has been indispensable 
to the completion of the work performed to date. Continued support for 
this research is essential to assure that decisions made on behalf of 
improved air quality are based on scientifically valid information, and 
that the interests of agriculture are considered in the process.
    For fiscal year 2000, our Coalition is seeking federal funding once 
again through the U.S. Department of Agriculture to support 
continuation of this vital study in California. In the budget for the 
Cooperative State Research, Education, and Extension Service (CSREES), 
we request $436,500, representing one-half of the $873,000 historical 
baseline split between California and Washington in the past four 
budget cycles.
    The California Regional PM-10/PM-2.5 study will not only provide 
vital information for a region identified as having particularly acute 
PM-10/PM-2.5 problems, it will also serve as a model for other regions 
of the country that are experiencing similar problems. The results of 
this study will provide improved methods and tools for air quality 
monitoring, emission estimations, and effective control strategies 
nationwide. Consequently, the beneficial results of this research will 
contribute to national policy as well.
    The Coalition appreciates the Subcommittee's consideration of this 
request for a fiscal year 2000 appropriation of $436,500 for U.S.D.A. 
to support the California Regional Region PM-10/PM-2.5 Air Quality 
Study. U.S.D.A's past contributions have helped ensure the success of 
the study. The coalition thanks you for your support of this important 
program.
                                 ______
                                 
   Prepared Statement of the Coalition for Affordable Pharmaceuticals
    Mr. Chairman and Members of the Subcommittee, the Coalition for 
Affordable Pharmaceuticals (CAP) is pleased to have the opportunity to 
present these comments on the fiscal year 2000 budget request for the 
Food and Drug Administration, on behalf of its members. CAP is a 
coalition of three national trade associations representing 
manufacturers and distributors of finished multi-source generic 
pharmaceuticals, manufacturers and distributors of bulk active 
pharmaceutical chemicals, and suppliers of other goods and services to 
the generic drug industry. CAP's combined membership encompasses 
virtually the entire U.S. generic pharmaceutical industry.
I. Generic Drugs Create Significant Health Care Cost Savings
    As in recent years, the generic drug industry addresses this 
Subcommittee in order to request that appropriations be allocated to 
FDA's Office of Generic Drugs (OGD). OGD is the agency's office with 
responsibility for reviewing and approving generic pharmaceutical 
applications, called abbreviated new drug applications (ANDAs). Unlike 
past years, however, our testimony does not stand alone but, rather, 
supports the Administration's $1.9 million appropriations request for 
OGD. CAP is pleased that the Administration is advocating increased 
funding for OGD, which will lead to faster generic drug approvals.
    Generic drugs continue to represent one of the most effective means 
of curbing spiralling healthcare costs in the U.S.\1\ For example, the 
cost of prescription drugs increased by 22 percent in 1998 according to 
the Office of Personnel Management,\2\ for a total of $94 billion spent 
on prescription drugs.\3\ In the federal health program, one out of 
every five health care dollars is spent on prescription medicine.\4\ In 
the face of these costs, competition from generics in the prescription 
drug market has saved American consumers, taxpayers, and Federal and 
state governments billions of dollars since 1984 when the Hatch-Waxman 
Act was passed. According to a July 1998 Congressional Budget Office 
study, purchasers of pharmaceuticals at retail pharmacies saved $8--$10 
billion in 1994 alone.\5\ These savings occur because generic drugs 
typically enter the market at 25 percent--30 percent below the brand 
price and, within two years, decline to 60 percent--70 percent of the 
brand price.\6\ This price discount creates a substantial savings for 
taxpayers and consumers, which is especially important to those seniors 
and the uninsured who have difficulty meeting their health care needs.
---------------------------------------------------------------------------
    \1\ According to surveys conducted by Hewitt Associates, Towers 
Perrin, and Buck Consultants, companies can expect increases in their 
health care costs ranging from 7 to 10 percent in 1999. That increase 
is double the 4 percent average increase in health care costs in 1998. 
Great-West Executive Says Self-Funded Insurance Offers Businesses an 
Alternative to Traditional Health Care Plans, PR Newswire, Mar. 3, 
1999, at 2061. Moreover, after record financial losses in 1998, managed 
care companies and health maintenance organizations reportedly intend 
to ``ratchet up premiums to restore profit margins.'' Joseph 
McCafferty, Critical Condition, CFO, The Magazine for Senior Financial 
Executives, Jan. 1999, at 63.
    \2\ Joseph McCafferty, Critical Condition, CFO, The Magazine for 
Senior Financial Executives, Jan. 1999, at 63. Without citing the basis 
for its figures, another industry analyst reports that 1998 drug sales 
rose 17 percent. Industry Watch, Sales & Marketing Management, Jan. 
1999, at 18.
    \3\ Substitutions Ahead Slightly as Share of New Rx's, Generic 
Line, Feb. 24, 1999, at 1-2.
    \4\ Joseph McCafferty, Critical Condition, CFO, The Magazine for 
Senior Financial Executives, Jan. 1999, at 63.
    \5\ CBO Report, ``How Increased Competition from Generic Drugs has 
Affected Prices and Returns in the Pharmaceutical Industry'' (July 
1998), at Summary.
    \6\ CBO Report, ``How Increased Competition from Generic Drugs has 
Affected Prices and Returns in the Pharmaceutical Industry'' (July 
1998), at Summary; ``Economic Impact of GATT Patent Extension on 
Currently Marketed Drugs,'' PRIME Institute, College of Pharmacy, 
University of Minnesota (Mar. 1995), at Executive Summary; SBC Warburg 
Dillon Read Inc., ``Industry Report--Specialty Pharmaceuticals: Generic 
Drugs, May 20, 1998, at 22.
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    While cost-effective generic pharmaceuticals have reduced health 
care costs in this country, the savings could be even greater if FDA 
took final action on generic applications within the statutorily 
required six months.\7\ This Subcommittee previously has emphasized the 
importance of accelerating generic drug approvals.\8\ Due in large part 
to the appropriations designated in 1998 and 1999, OGD has successfully 
focused on this mandate. Nevertheless, the Subcommittee must continue 
its support for OGD, ensuring that the agency has adequate funding to 
approve safe and effective generic drugs promptly and efficiently.
---------------------------------------------------------------------------
    \7\ Under the law, FDA must take final action on generic drug 
applications within 180 days. 21 U.S.C. 355(j)(5). In 1998, the median 
time to approval for ANDAs was 18 months--three times the length 
mandated by statute. Comments of Douglas L. Sporn, Director, OGD, 
``Update on the Office of Generic Drugs,'' at the NAPM 1999 Annual 
Meeting & Education Conference (Feb. 3, 1999).
    \8\ S. Rep. No. 105-212 (1998) at 121.
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II. CAP Recommends Increased Funding To Expedite Generic Drug Approvals
    We encourage the Subcommittee to continue this initiative by 
providing additional funds that will allow OGD to progress further 
toward meeting the six month statutory period for final agency action 
on ANDAs. Specifically, we recommend that the Subcommittee take the 
following actions: Grant the Administration's request for a direct 
appropriation of $1.9 million for the Office of Generic Drugs, in 
addition to its fiscal year 1999 funding level; and Continue to insist 
that FDA provide detailed and accurate information about agency 
expenditures specifically for, and by OGD.
    Not only would the appropriations assist in reducing approval 
times, but also the funds would aid OGD in addressing artificial 
barriers to competition that are continuously erected by the brand drug 
industry, as is explained further below.
III. With Increased Appropriations, OGD Can Hire Additional Staff To 
        Meet Its Workload
    Among the most pressing needs at OGD is one for additional staff 
members to review generic applications. While the Administration 
reports that a majority of the $1 million appropriated to OGD in 1999 
will be used to fund FTE's, the current appropriations request would 
add another 11 FTE's to the office.\9\ These staff members are 
essential to handling OGD's ever increasing workload. In 1998, OGD 
received an unprecedented 564 ANDAs, up from 464 in 1997.\10\ This 
increase in application submissions will likely continue. In fact, over 
the next five years, approximately $22 billion in annual prescription 
drug sales will be open to generic competition due to patent 
expirations.\11\
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    \9\ HHS fiscal year 2000 Justification of Estimates for 
Appropriations Committees and Performance Plan, at 40 and 82.
    \10\ Comments of Douglas L. Sporn, Director, OGD, ``Update on the 
Office of Generic Drugs,'' at the NAPM 1999 Annual Meeting & Education 
Conference (Feb. 3, 1999).
    \11\ SBC Warburg Dillon Read Inc., ``Industry Report--Specialty 
Pharmaceuticals: Generic Drugs, May 20, 1998, at 32
---------------------------------------------------------------------------
    Further compounding these numbers, the Administration asserts that 
the fiscal year 2000 funding will enable them to meet only the modest 
goal of a 3.2 percent increase in the average monthly number of OGD 
actions (which include approvals, tentative approvals, not approvals 
and facsimile requests).\12\ The modest nature of this goal highlights 
the need for additional funding to continue OGD's efforts toward 
accelerating generic drug approval times. Thus, Congress has the 
opportunity now to positively impact OGD's workload and speed generic 
drugs to consumers.
---------------------------------------------------------------------------
    \12\ HHS fiscal year 2000 Justification of Estimates for 
Appropriations Committees and Performance Plan, at 83.
---------------------------------------------------------------------------
IV. With Additional Funding And Staff, OGD Can Address Troublesome 
        Citizen Petitions
    OGD's priorities should be expanded to address the misuse of 
citizen petitions for challenging FDA's scientific decisions related to 
generic drug applications. At least 50 citizen petitions have been 
filed since 1990 seeking actions that would result in a delay in 
approval of generic drugs.\13\ In response, scarce OGD resources are 
used to review these petitions, many of which are frivolous, anti-
competitive actions. While FDA has worked tirelessly to close out these 
petitions, the agency falls further behind as more petitions are filed. 
For instance, although FDA completed its review of eight petitions 
related to generic drugs in 1998, 10 more were filed by the brand 
industry that year.\14\ OGD senior scientists who otherwise would be 
reviewing ANDAs must turn their attention to these petitions, delaying 
ANDA review times even further.\15\ With additional funds, OGD could 
hire senior scientists that would devote much of their time to clearing 
the backlog of petitions that delay generic approvals.
---------------------------------------------------------------------------
    \13\ A detailed chart describing 51 citizen petitions is available 
on request. It is titled, ``Citizen Petitions That Request FDA Actions 
Against Generic Drug Applications (ANDAs), 1990--Present.''
    \14\Id.
    \15\Douglas Sporn, Director of FDA's Office of Generic Drugs, has 
stated that the ``speed of [ANDA] approvals depends on how much 
reviewers are distracted by citizen petitions . . . .'' Sporn Updates 
Generic Drug Industry on Forthcoming Guidances, FDA Week (Apr. 2, 
1999), at 11 (comments at GPIA Annual Meeting, March 1999).
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V. Additional Funds Could Be Used To Educate The Public About Generic 
        Equivalence
    An increase in appropriations also could be used by FDA to counter 
inaccurate claims made by some brand companies that the substitution of 
generic drugs for brand drugs poses a health risk for patients.\16\ 
While this scare tactic is belied by sound science, it serves to 
undermine the public's confidence in the value of FDA's decisions about 
the safety and effectiveness of generic drug products. With additional 
funding, OGD could provide accurate information to educate consumers, 
policy makers, and state government officials about the scientific 
integrity of the ANDA process and FDA's therapeutic equivalence 
decisions.
---------------------------------------------------------------------------
    \16\ A detailed chart describing the state lobbying initiatives 
undertaken by the brand industry is available on request. It is titled, 
``Anti-Generic Challenges Before State Formularies (Other Than 
Coumadin(/NTI Challenges).''
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VI. Conclusion
    In summary, we request that Congress continue to guide FDA's 
priorities by appropriating and allocating resources directly to OGD. 
As medical treatment becomes even more expensive, it is important that 
generic drug applications move through the approval process as quickly 
as scientifically sound reviews for bioequivalence permit. Although 
generic drug median approval times have improved tremendously, the 
agency's review period is still three times longer than the six month 
statutory requirement.\17\ Every day that a generic drug is delayed 
from entering the market, Americans pay millions of dollars more for 
their prescription drug products. Without additional appropriated 
funds, and with million-dollar drugs coming off patent, the delay in 
approval is likely to increase--an unacceptable scenario. Only 
Congressional mandates can ensure that FDA will continue to invest the 
resources necessary to ensure timely generic approvals which, in turn, 
will continue to provide a check on prescription drug prices. Mr. 
Chairman, the Coalition for Affordable Pharmaceuticals would like to 
thank you and the Subcommittee for its time and attention concerning 
this critical aspect to FDA's fiscal year 2000 budget request. We look 
forward to continuing our work with you and members of the Subcommittee 
to bring safe, effective and more affordable pharmaceuticals to the 
American public.
---------------------------------------------------------------------------
    \17\ Comments of Douglas L. Sporn, Director, OGD, ``Update on the 
Office of Generic Drugs,'' at the NAPM 1999 Annual Meeting & Education 
Conference (Feb. 3, 1999).
---------------------------------------------------------------------------
                                 ______
                                 
 Prepared Statement of the Coalition of Agricultural Mediation Programs
    We request that you include $4 million in the fiscal year 2000 
Agriculture Appropriations bill for the certified state mediation grant 
program. This is the minimum funding level needed for state mediation 
programs to operate and provide meaningful services. The mediation 
program has been successfully used by thousands of producers, creditors 
and USDA to resolve disputes without costly litigation. Most 
importantly, mediation has allowed all the parties to resolve the 
disputes themselves according to their own best interests.
    The President's budget for fiscal year 2000 requests $4 million for 
the grant program, which is consistent with his Proclamation dated May 
1, 1998 encouraging greater use of mediation and other Alternative 
Dispute Resolution techniques throughout the executive branch. USDA has 
the benefit of well-developed and experienced certified mediation 
programs in over 20 states. What it now needs is adequate funding to 
ensure the continuation of these programs, and the development of 
programs in more states.
    The Coalition of Agricultural Mediation Programs (CAMP) is 
comprised of the states that have had their mediation programs 
certified by USDA. In fiscal year 1999 the twenty-two state programs 
requested grants totaling around $3.3 million. With only $2 million 
appropriated, all state program grants were pro-rated to only 60 
percent of their needs. At the same time, the on-going economic crisis 
in agriculture is increasing the demand in established state mediation 
programs, while interest in establishing new programs in additional 
states is growing. In fact, it is entirely possible that the requested 
$4 million appropriation may fall short if the agricultural economic 
crisis persists.
    Certified state mediation programs were originally authorized under 
the Agricultural Credit Act of 1987 as a way to assist agricultural 
producers and their creditors resolve disputes through mediation, 
reducing the cost of administrative appeals, litigation and bankruptcy 
to all parties. Agricultural mediation played a very important role in 
resolving financial disputes between farmers/ranchers and lenders 
during the farm economic crisis in the 1980s. As you are well aware, 
many agricultural producers in our country are once again facing 
economic crises. Financial problems for producers translates into 
problems for local banks, co-ops, feed suppliers, etc. This will create 
a greater need for state mediation services in fiscal year 2000.
    Adequate funding for this program has been recognized and 
recommended as one of the measures to help address the challenges being 
experienced by the nation's farmers, their lenders, and others.
  --Governors and agriculture officials from 15 states gathered for the 
        Plains States Rural Crisis Summit in Oklahoma City on August 6-
        7, 1998. Adequate funding for the USDA Certified Mediation 
        Grants Program was one of nine emergency recommendations that 
        were forwarded to Congress.
  --On September 28, 1998, the National Association of State 
        Departments of Agriculture (NASDA) included adequate resources 
        for mediation, financial analysis, and related services as part 
        of its recommended disaster assistance package.
  --By letter dated March 1, 1999, NASDA urged Congress to appropriate 
        supplemental funding for Farm Service Agency loan programs and 
        mediation grants.
    The financial restrictions, increasing demand for mediation 
services and current economic conditions make it critical that the $4 
million appropriation be granted. Please give me a call at (618) 453-
5181 if you have any questions. Thank you for your attention to this 
important issue.
                                 ______
                                 
  Prepared Statement of Dr. Robert A. Altenkirch, Vice President for 
                 Research, Mississippi State University
    Mr. Chairman and Members of the Subcommittee, thank you for the 
opportunity to submit this testimony on behalf of the Coalition of 
EPSCoR States \1\ regarding the U.S. Department of Agriculture 
Experimental Program to Stimulate Competitive Research (USDA EPSCoR). 
USDA EPSCoR is extremely important to agricultural research in the 
state of Mississippi and in our nation. I appreciate the opportunity to 
submit this testimony.
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    \1\ Alabama, Arkansas, Idaho, Kansas, Kentucky, Louisiana, Maine, 
Mississippi, Montana, Nebraska, Nevada, North Dakota, Oklahoma, Puerto 
Rico, South Carolina, South Dakota, Vermont, West Virginia, and Wyoming
---------------------------------------------------------------------------
    I would also like to extend my appreciation to you, Mr. Chairman, 
for your strong support of USDA EPSCoR. This important program is 
having a significant impact in Mississippi and in the other USDA EPSCoR 
states. Your support and the support of this Subcommittee have been 
absolutely crucial in establishing and maintaining this important 
program. Mr. Chairman, those of us committed to improving Mississippi's 
research and development capability deeply appreciate your support and 
your effort. Thank you for your fine work representing Mississippi in 
the United States Senate.
    Seven federal agencies have EPSCoR or EPSCoR-like programs, 
including USDA. EPSCoR works to improve our country's science and 
technology capability by funding activities of talented researchers in 
states that have historically not received significant federal R&D 
funding. USDA EPSCoR was established in fiscal year 1992 with a goal of 
increasing the amount of agricultural research at academic institutions 
within states that have had limited success obtaining competitive funds 
from USDA.
    The Mississippi EPSCoR program began in 1988 with the naming of the 
state EPSCoR Committee by the Governor. Mississippi EPSCoR obtained its 
first funding in 1989 from USDA EPSCoR's sister program in the National 
Science Foundation. Since that time, EPSCoR has had an enormously 
positive impact within the state and at the four research institutions 
and their affiliates.
    Because of the multi-institutional framework of EPSCoR and of the 
commitment of the state EPSCoR Committee to creating a critical mass of 
scientists and engineers around specific issues as well as a more fully 
developed statewide infrastructure, Mississippi EPSCoR has produced a 
stronger, more competitive research community and closer working 
relationships among the institutions that participate in the federal 
EPSCoR programs: Jackson State University, Mississippi State 
University, the University of Mississippi, the University of Southern 
Mississippi, and the University of Mississippi Medical Center.
    Mr. Chairman, USDA EPSCoR is helping to improve the quality and 
competitiveness of agriculture research in Mississippi. Since the 
program was established in 1992, 64 Mississippi researchers have 
received USDA EPSCoR Strengthening Awards. These investigators have 
been located at Mississippi State University, the University of 
Mississippi Medical Center, and the University of Southern Mississippi. 
The amount of USDA research funds received by Mississippi increased by 
more than 500 percent between 1990 and 1996, a clear indication that 
Mississippi researchers are becoming more effective.
    Important examples of Mississippi's research include studies in 
such areas as: kenaf processing, which is a potential economic 
opportunity for rural states; rapid detection of E coli, an important 
factor in food safety; and disease mechanisms in channel catfish, which 
impacts a significant cash crop across the southern part of the 
country. These projects and many, many others address issues important 
to rural states and to the rest of the nation. USDA EPSCoR allows 
researchers across our country to contribute to our economy and our 
agricultural research knowledge base.
    USDA EPSCoR states are those whose funding ranks no higher than the 
38th percentile of all states, based on a three year rolling average. 
For fiscal year 1999, the following states are eligible: Alaska, 
Arkansas, Connecticut, Delaware, Hawaii, Idaho, Maine, Mississippi, 
Montana, Nevada, New Hampshire, New Mexico, North Dakota, Rhode Island, 
South Carolina, South Dakota, Utah, Vermont, West Virginia, Wyoming, 
and the Commonwealth of Puerto Rico. Let me stress that EPSCoR relies 
on rigorous merit review in order to ensure that it funds only high-
quality research.
    USDA makes four types of competitive awards through USDA EPSCoR: 
Research Career Enhancement Awards, Equipment Grants, Seed Grants, and 
Strengthening Standard Research Project Awards. Proposals must be 
related to the program priorities of the National Research Initiative 
Competitive Grants Program, which address critical issues facing 
agriculture today.
  --Research Career Enhancement Awards help faculty enhance their 
        research capabilities by funding sabbatical leaves. Applicants 
        may not have received a NRICGP competitive research grant 
        within the past five years.
  --Equipment Grants strengthen the research capacity of institutions 
        in USDA EPSCoR states. The grant cannot exceed 50 percent of 
        the cost of the equipment. The principal investigator for this 
        grant is responsible for securing non-Federal matching funds.
  --Seed Grants enable researchers to collect preliminary data in 
        preparation for applying for a standard research grant. Seed 
        Grant awards are limited to a total cost of $50,000, including 
        indirect costs, and are non-renewable. Applicants must indicate 
        how the research will enhance future competitiveness in 
        applying for standard research grants.
  --Strengthening Standard Research Project Awards fund standard 
        research projects of investigators who have not received a 
        NRICGP grant within the past five years.
    Through USDA EPSCoR, Mississippi and the other USDA EPSCoR States 
contribute more effectively to our nation's science and technology 
capability, and help provide our country with needed, high-quality, 
peer-reviewed research. This program allows all regions of our country 
to contribute to our nation's science and technology capability while 
allowing flexibility to meet regional research needs. USDA EPSCoR is a 
sound investment of taxpayer dollars.
    Mr. Chairman, the Subcommittee has for several years directed USDA 
to set aside 10 percent of USDA NRICGP funds for USDA EPSCoR. Those 
funds have provided significant opportunity and significant success in 
Mississippi and the other EPSCoR states. I request that the 
Subcommittee once again include report language directing USDA to set 
aside 10 percent of its NRI competitive grant funds in fiscal year 2000 
for an EPSCoR program. These funds will allow the EPSCoR states to 
continue providing for the agricultural research needs of rural America 
and of our nation.
    I thank the Subcommittee for the opportunity to submit this 
testimony.
                                 ______
                                 

   Prepared Statement of the Coalition to Promote U.S. Agricultural 
                                Exports

    As members of the Coalition to Promote U.S. Agricultural Exports, 
we commend the Chairman and members of the Subcommittee for their 
interest and support of U.S. agriculture and express our appreciation 
for this opportunity to share our views.
    The Coalition to Promote U.S. Agricultural Exports is an ad hoc 
coalition of over 80 organizations, representing farmers and ranchers, 
cooperatives, small businesses, regional trade organizations, and the 
State Departments of Agriculture. We believe the U.S. must continue to 
have in place policies and programs that help maintain the ability of 
American agriculture to compete effectively in a global marketplace 
still characterized by subsidized foreign competition.
    This is especially true as the Federal Agriculture Improvement and 
Reform Act of 1996 (FAIR Act), that resulted in the most sweeping 
reforms in farm policy in over 60 years, continues to be implemented. 
Under this legislation, farm income and the economic well being of 
American agriculture are now dependent more than ever on continued 
access to foreign markets and maintaining and strengthening U.S. 
agricultural exports.
    American agriculture and American workers, however, continue to be 
threatened by subsidized foreign competition. Recent trade agreements, 
including NAFTA and the Uruguay Round Agreement on GATT, did not 
eliminate the use of export subsidies or other forms of export 
assistance. According to a recent analysis by USDA, the European Union 
(EU) and other foreign competitors are outspending the U.S. by a factor 
of 20 to 1 with regard to the use of export subsidies and other 
expenditures for export promotion.
    The same study showed that such countries are spending over $100 
million just to promote sales of their products in the United States. 
In other words, they are spending more to promote their agricultural 
exports to the United States, than the U.S. is currently spending ($90 
million) to promote American agricultural exports worldwide!
    According to the same study by USDA, the U.S. faces a growing 
challenge in the area of market promotion. In 1997, in addition to 
spending over $7.2 billion in export subsidies, our leading foreign 
competitors spent a combined $924 million on various activities to 
promote their exports of agricultural, forestry, and fishery products, 
including some $365 million by the EU.
    USDA's study goes on to say that ``because market promotion is a 
permitted `green box' activity under World Trade Organization (WTO) 
rules, with no limit on public or producer funding, it is increasingly 
seen as a centerpiece of a winning strategy in the future trade 
battleground. Many competitor countries have announced ambitious trade 
goals and are shaping export programs to target promising growth 
markets and bring new companies into the export arena * * * '' European 
countries are expanding their promotional activities in Asia, Latin 
America, and Eastern Europe. Canada, Australia and New Zealand have 
also sharply bolstered their export promotion expenditures in recent 
years. Clearly, our foreign competitors are aggressively seeking to 
maintain and increase their share of the world market at the expense of 
U.S. producers.
    For this reason, we believe the Administration and Congress should 
give serious consideration to strengthening funding for MAP and other 
export programs, and ensuring that such programs are fully and 
aggressively utilized. Since MAP was originally authorized, funding has 
been gradually reduced from a high of $200 million to its current level 
of $90 million--a reduction of more than 50 percent. Again, given what 
our foreign trade competitors are doing, we believe it's time to 
restore funding for this vitally important program to its original 
level.
    We also urge that funding for USDA's Foreign Market Development 
(FMD) Cooperator Program be maintained at no less than the current year 
level. In addition, we want to express our strong support for ensuring 
adequate funding for USDA's Foreign Agricultural Service (FAS) to help 
meet critical export goals and objectives. Such action is essential to 
America's overall trade strategy and economic interests.
    Both MAP and FMD, which are administered on a cost-share basis, 
remain one of the few tools specifically allowed under the Uruguay 
Round Agreement to help American agriculture and American workers 
remain competitive in a global marketplace still characterized by 
subsidized foreign competition. By any measure, they have been 
tremendously successful and extremely cost-effective in helping 
maintain and expand U.S. agricultural exports, countering subsidized 
foreign competition, protecting American jobs and strengthening farm 
income. American agriculture is the most competitive industry in the 
world, but it can not and should not be expected to compete alone 
against the treasuries of foreign governments.
    For all these reasons, we want to emphasize again the need to help 
strengthen the ability of U.S. agriculture to compete effectively in a 
global marketplace still characterized by subsidized foreign 
competition. As a nation, we can work to export our products, or we can 
export our jobs. USDA's export programs, such as MAP and FMD, are a key 
part of an overall trade strategy that is pro-growth, pro-trade and 
pro-job.
    Again, as members of the Coalition to Promote U.S. Agricultural 
Exports, we appreciate very much this opportunity to share our views 
and we ask this statement be included in the official hearing record.
                                 ______
                                 
 Prepared Statement of the Colorado River Basin Salinity Control Forum
    The Congress concluded that the Colorado River Basin Salinity 
Control Program should be implemented in the most cost-effective way 
and realizing that agricultural on-farm strategies were some of the 
most cost-effective strategies authorized a program for the Department 
of Agriculture. With the enactment of the Federal Agriculture 
Improvement and Reform Act of 1996 (FAIRA), the Congress concluded that 
the Salinity Control Program could be most effectively implemented as 
one of the components of the Environmental Quality Incentives Program. 
Since the enactment of FAIRA, the Salinity Control Program has not been 
funded at a level adequate to ensure that water quality standards in 
the Colorado River, with respect to total dissolved solids (salinity), 
will be honored, nor is the funding sufficient to prevent salt loading 
from irrigated farms from impacting the quality of water delivered to 
Mexico under a minute of the International Boundary and Water 
Commission, United States and Mexico.
    The problem rests with the Department of Agriculture concluding 
that it should not designate any area of the country as a national 
priority area at this time. The Salinity Control Program has been 
subsumed into the EQIP program without the Secretary of Agriculture 
giving adequate recognition to the requirement in Section 202(c) in the 
Colorado River Basin Salinity Control Act to carry out salinity control 
measures. Further, the Administration has concluded that the 
expenditure of EQIP funds shall be determined by initiatives developed 
at the grassroots level. Under USDA directives, this means that Upper 
Basin agricultural communities advance salinity control proposals for 
the salinity control program. The proposal must be implemented in the 
Upper Basin, as that is where the salt loading is occurring. Water 
users hundreds of miles downstream are the beneficiaries of this water 
quality improvement program. Agriculturalists in the Upper Basin, 
however, see local benefits as well as downstream benefits and have 
submitted cost-effective proposals to the State Conservationists in 
Utah, Wyoming and Colorado. A majority of the EQIP funds are designated 
to be used in priority areas which are normally small geographic 
watersheds. Priority Area proposals for EQIP funding are ranked in each 
state under the direction of the NRCS State Conservationist. The 
existing ranking criteria, however, does not consider downstream 
benefits (particularly out of state benefits) when proposals are being 
evaluated.
    If the Department of Agriculture believes that it is directed by 
the Congress to implement the Salinity Control Program, then it is 
incomprehensible that the program that is designed to provide 
downstream benefits cannot receive credit in ranking criteria for the 
accomplishment of the downstream benefits. The solution to the problem 
is simple. Grassroots in the Colorado River Basin with respect to 
salinity control means at the states level and review of proposals 
should take place at the seven Colorado River Basin states level 
through the Forum. The states, through the efforts of the Salinity 
Control Forum, have adopted a program approved by EPA. The Forum should 
be recognized as the grassroots level for the Salinity Control Program 
and the Forum should serve as the Technical Advisory Committee (local 
work group) to Administration officials as to the need for and the 
expenditure of funds for the Salinity Control Program. The Colorado 
River Basin is covered by two NRCS regions and the program must be 
coordinated at a high administration level. A national priority 
designation is needed. Numerous requests have gone to the Department of 
Agriculture to make this designation, and the response has been that 
there are not adequate funds in the EQIP program to go beyond the 
initially adopted ``grassroots'' effort. Therefore, the Forum is 
pleased with the Administration's statement that it intends to expend 
$300,000,000 in fiscal year 2000 on the EQIP program.
    The Basin states were led to believe by Congressional staff that 
when the EQIP program was created, the $200,000,000 annual Commodity 
Credit Corporation (CCC) borrowing authority given to the Secretary 
would ensure that through the year 2002 at least this amount of funding 
would be expended for the EQIP program. The Forum was very dismayed 
when last year this committee acted to reduce the fiscal year 1999 
funding to $174,000,000. This level of funding is not adequate for this 
most important nationwide program and the Administration does not 
believe that it provides sufficient funds to implement National 
Priority Areas as allowed by Congress under FAIRA. The Forum urges that 
the funding for EQIP for fiscal year 2000 total $300,000,000.
    This last year, the Natural Resources Conservation Service (NRCS) 
set aside Congressionally earmarked funds to use in areas of special 
interest in the Colorado River drainage and in Mississippi. The Forum 
commends this designation and believes this is a first step towards 
designation of National Priority Areas. However, under NRCS earmarked 
designation, not enough funds were made available to adequately 
implement the needed program in the Colorado River Basin. The Forum 
fears that adequate funding may not be made available by the Secretary 
until the Congress increases, in a significant way, the funds to be 
spent in the EQIP.
    The Basin states have cost sharing dollars available to participate 
in on-farm salinity control efforts in the cost-sharing fashion 
provided by the Congress. The agricultural producers in the Upper Basin 
are waiting for their applications to be considered so that they might 
also cost share in the program. When all of the cost sharing is 
tabulated, the federal cost of the program is less than 50 percent. 
However, because of the structure of the EQIP and the associated 
authorized cost sharing under the Colorado River Basin Salinity Control 
Act, these funds cannot be expended in this cooperative effort until 
federal funds are made available.
    The Forum urges that this committee support the funding of 
$300,000,000 from the CCC in fiscal year 2000 for EQIP. The Forum also 
requests that this Committee advise the Administration that $12,000,000 
of these funds be designated for the Colorado River Basin Salinity 
Control Program.
                                overview
    The Colorado River Basin Salinity Control Program was authorized by 
Congress in 1974. The Title I portion of the Colorado River Basin 
Salinity Control Act responded to commitments that the United States 
made, through a minute of the International Boundary and Water 
Commission, to Mexico with respect to the quality of water being 
delivered to Mexico below Imperial Dam. Title II of the Act established 
a program to respond to salinity control needs of Colorado River water 
users in the United States and to comply with the mandates of the then 
newly legislated Clean Water Act. Initially, the Secretary of the 
Interior and the Bureau of Reclamation were given the lead federal role 
by the Congress. This testimony is in support of funding for the Title 
II program.
    After a decade of investigative and implementation efforts, the 
Basin states concluded that the Salinity Control Act needed to be 
amended. Congress revised the Act in 1984. That revision, while keeping 
the Secretary of the Interior as lead coordinator for Colorado River 
Basin salinity control efforts, also gave new salinity control 
responsibilities to the Department of Agriculture, and to a sister 
agency of the Bureau of Reclamation--the Bureau of Land Management. 
Congress has charged the Administration with implementing the most 
cost-effective program practicable (measured in dollars per ton of salt 
removed). The Basin states are strongly supportive of that concept as 
the Basin states consider cost sharing 30 percent of federal 
expenditures up-front for the salinity control program, in addition to 
proceeding to implement their own salinity control efforts in the 
Colorado River Basin.
    Since the Congressional mandates of nearly two decades ago, much 
has been learned about the impact of salts in the Colorado River 
system. The Bureau of Reclamation has recently completed studies on the 
economic impact of these salts. Reclamation recognizes that the damages 
to United States' water users alone may soon be approaching $1 billion 
per year.
    The Colorado River Basin Salinity Control Forum (Forum) is composed 
of Gubernatorial appointees from Arizona, California, Colorado, Nevada, 
New Mexico, Utah and Wyoming. The Forum has become the seven-state 
coordinating body for interfacing with federal agencies and Congress to 
support the implementation of a program necessary to control the 
salinity of the river system. In close cooperation with the 
Environmental Protection Agency (EPA) and under requirements of the 
Clean Water Act, every three years the Forum prepares a formal report 
analyzing the salinity of the Colorado River, anticipated future 
salinity, and the program necessary to keep the salinities at or below 
the levels measured in the river system in 1972.
    In setting water quality standards for the Colorado River system, 
the salinity concentrations measured at Imperial, and below Parker, and 
Hoover Dams in 1972 have been identified as the numeric criteria. The 
plan necessary for controlling salinity has been captioned the ``plan 
of implementation.'' The 1996 Review of water quality standards 
includes an updated plan of implementation. The level of appropriation 
requested in this testimony is in keeping with the agreed to plan. If 
adequate funds are not appropriated, state and federal agencies 
involved are in agreement that the numeric criteria will be exceeded 
and damage from the high salt levels in the water will be widespread in 
the United States and Mexico and will be very significant.
                        additional funding needs
    The authorized cost sharing by the Basin states was at first 
difficult to implement as attorneys for USDA concluded that the Basin 
states were authorized by FAIRA to cost share in the effort, but the 
Congress had not given USDA authority to receive the Basin states' 
funds. After almost a year of exploring every possible solution as to 
how the cost sharing was to occur, the states, in agreement with the 
Bureau of Reclamation, with state officials in Utah, Colorado and 
Wyoming and with NRCS State Conservationists in Utah, Colorado and 
Wyoming, agreed upon a parallel program wherein the states' cost 
sharing funds will be used. We are now in the third year of that 
program and, at this moment in time, this solution to how cost sharing 
can be implemented appears to be a good one.
    With respect to the states' cost sharing funds, the Basin states 
felt that it was most essential that a portion of the program be 
associated with technical assistance and education activities in the 
field. Without this necessary support, there is no advanced planning, 
proposals are not well thought out, assertions in the proposals cannot 
be verified, implementation of contracts cannot be observed, and the 
most valuable partnering and education efforts cannot occur. 
Recognizing these values, the parallel state cost sharing program 
spends 40 percent of the funds available on these support activities. 
Initially, it was acknowledged that the federal portion of the salinity 
control program funded through EQIP was starved with respect to needed 
technical assistance and education support. The Forum is encouraged 
with the Administration's recent determination that 19 percent of the 
EQIP funds will be used for technical assistance. The Forum urges this 
Committee to appropriate adequate funds for these support activities 
rather than to direct NRCS to borrow these needed funds from the CCC.
                                 ______
                                 

      Prepared Statement of the Colorado River Board of California

    Your support and leadership are needed in securing adequate funding 
for the U.S. Department of Agriculture with respect to it's on-farm 
Colorado River Basin salinity control program for fiscal year 2000. 
This program has been carried out through the Colorado River Basin 
Salinity Control Act, which was initially enacted by Congress in 1974. 
With the enactment of the Federal Agricultural Improvement and Reform 
Act (FAIRA) in 1996, specific funding for salinity control projects in 
the Colorado River Basin were eliminated from the federal budget, and 
aggregated into the newly created Department of Agriculture 
Environmental Quality Incentive Program (EQIP) as one of its program 
components. With the enactment of the FAIRA, Congress concluded that 
the salinity control program could be more effectively implemented as 
one of the components of the EQIP. In the past, the Department of 
Agriculture had specific line item funding for salinity control 
projects as high as $14.7 million but in recent years it has advanced 
only $3.4 to $4.6 million which is inadequate to ensure that water 
quality standards in the Colorado River, with regards to salinity can 
be met. It has been estimated through previous federal studies that the 
Lower Basin States' (Arizona, California, and Nevada) Colorado River 
water users were suffering economic damages estimated to be in excess 
of $750 million per year in 1995 due to the salts in the River system. 
Most of that damage is occurring in California. The potential impact of 
failing to move forward with the plan of implementation for salinity 
control would be to permit these damages in the Lower Basin to reach an 
estimated $1.25 billion annually by the year 2015.
    The Colorado River Board of California (Colorado River Board) is 
the state agency charged with protecting California's interests and 
rights in the water and power resources of the Colorado River System. 
In this capacity, California along with the other Basin States through 
the Colorado River Basin Salinity Control Forum (Forum), the interstate 
organization responsible for coordinating the Basin States' salinity 
control efforts, established, in June 1975, numeric criteria for 
salinity concentrations in the River. These criteria were established 
to lessen the future damages in the Lower Basin States as well as 
assist the United States in delivering water of adequate quality to 
Mexico in accordance with Minute 242 of the International Boundary and 
Water Commission. The goal of the Colorado River Basin salinity control 
program is to offset the effects of water resource development in the 
Colorado River basin after 1972 rather than to reduce the salinity of 
the River below levels that were caused by natural variations in river 
flows or human activities prior to 1972. To maintain these levels, the 
salinity control program must remove 1.48 million tons of salt loading 
from the River by year 2015. To date, only 717,000 tons of salt load 
reduction have been achieved. In the Forum's last report entitled 1996 
Review, Water Quality Standards for Salinity, Colorado River System 
released in June 1996, the Forum found that additional salinity control 
measures were necessary to meet the implementation plan that had been 
adopted by the seven Colorado River Basin States and approved by the 
Environmental Protection Agency. Since implementation of the EQIP, 
federal allocations by the Department of Agriculture have not equaled 
the Forum's identified funding needs for the Department of 
Agriculture's portion of the program. The Forum identified a 
``backlog'' of salinity control measures which stands at 312,000 tons. 
This is in addition to future controls designed to lower the River's 
salt loading by 437,000 tons by 2015 in order to meet the established 
salinity standards. Very simply, there is a need for at least 47,000 
tons of new salinity control measures to be implemented each year until 
2015. The Forum has presented testimony to Congress recommending that 
the salinity control efforts through EQIP be accelerated to continue to 
meet the salinity standards through 2015.
    The President's proposed budget for fiscal year 2000 contains 
funding of $300 million for implementation of EQIP, up $100 million 
from the $200 million Commodity Credit Corporation borrowing authority 
provided the Secretary of Agriculture by FAIRA. The Colorado River 
Board is pleased with the Administration's statement that it intends to 
expend $300 million in fiscal year 2000 through EQIP. Of the amount to 
be appropriated for EQIP, the Colorado River Basin Salinity Control 
Forum, at its meeting in Santa Fe, New Mexico, during October 1998, 
recommended a funding level of $12.0 million for on-farm salinity 
control in the Colorado River Basin for fiscal year 2000 to maintain 
water quality consistent with the established standards. These federal 
dollars if earmarked would be augmented by state cost sharing of 30 
percent with an additional 30 percent provided by the agricultural 
producer with whom the Department of Agriculture contracts for salinity 
control. The Colorado River Board supports the recommendation of the 
Forum. The salinity control program has proven to be a very cost 
effective approach to help mitigate the impacts of higher salinity. 
Continued federal funding of the program is essential.
    In addition, the Colorado River Board recognizes that the federal 
government has made significant commitments to the Republic of Mexico 
and to the seven Colorado River Basin States with regard to the 
delivery of adequate quality water to Mexico. In order for those 
commitments to be honored, it is essential that in fiscal year 2000 and 
in future fiscal years, the Congress provide funds to the Department of 
Agriculture to allow it to continue providing technical support in the 
Basin for salinity control.
    The Colorado River is, and will continue to be, a major and vital 
water resource to the 17 million residents of southern California as 
well as throughout the Lower Colorado River Basin. As stated earlier, 
preservation of its quality through an effective salinity control 
program will avoid the additional economic damages to users of Colorado 
River water in California, Arizona, and Nevada.
    The Colorado River Board greatly appreciates your support of the 
federal/state Colorado River Basin Salinity Control Program and again 
asks for your assistance and leadership in securing adequate funding 
for this program.
                                 ______
                                 
   Prepared Statement of the USDA UVB Radiation Monitoring Program, 
     Natural Resource Ecology Laboratory, Colorado State University
    Discovery of the Antarctic ozone hole in 1985, accompanied by a 
large increase in surface UVB radiation has raised serious questions 
about the continued protection by the stratospheric ozone layer of the 
earth's living systems from the harmful effects of UVB radiation. In 
the northern hemisphere estimates based primarily on satellite and 
limited ground based measurements indicate that stratospheric ozone is 
decreasing at the rate of 3-5 percent per decade. While these decreases 
will result in increased solar ultraviolet radiation penetrating the 
stratosphere, it is not fully understood how this will affect the 
amount of UVB radiation reaching the earth's surface. If stratospheric 
ozone depletion does result in increased surface radiation, it is not 
clear what the consequences will be for the earth's plant and animal as 
well as human populations. To help in answering this question, the USDA 
is supporting a program to develop a national UVB radiation 
climatology, to determine future trends in UVB, and to conduct research 
to better understand factors effecting UVB radiation at the earth's 
surface. Measurements are required in agricultural and rural areas of 
the U.S. in order to provide a record of climatology and trends 
relevant to potential impacts on agricultural productivity. Also, 
agriculture cannot rely on the commitment of other agencies to make 
measurements which meet their needs nor to sustain a long-term 
monitoring program (for example, the closing of weather stations 
critical to agriculture). The network is thus an integral part of the 
overall effort of the USDA to meet its obligation to assure the future 
productivity of American agriculture. The unique requirements of 
agriculture have been recognized by the ultraviolet radiation 
measurements community and the USDA monitoring program is an integral 
component of United States Global Change Research Program (USGCRP) as 
outlined in the 1995 report (USGCRP-95-01) titled ``The U.S. 
Interagency UV-Monitoring Network Plan''.
    The USDA UVB Radiation Monitoring program at Colorado State 
University (CSU) was initiated in 1992 with funding from the USDA 
CSREES Special Research Grants program. The network now consists of 27 
sites across the U.S. including Hawaii. The network was scheduled to 
expand to a planned 30-40 sites. This is now delayed as a result of 
budget reductions. Each of these sites has a seven wavelength UV 
spectral instrument (interference filters with 2 nm bandpass at 300, 
305, 311, 317, 325, 332, and 368 nm) equipped with a shadowband which 
permits the simultaneous measurement of the total horizontal, diffuse, 
and direct normal irradiance at each wavelength. Each site is also 
equipped with a similar instrument with wavelengths in the visible 
(415, 500, 610, 665, 862, and 940 nm) to provide ancillary information 
to aid in interpreting factors effecting UVB irradiance. In order to 
provide data for comparison with many who are using less expensive 
broadband instruments, each site is equipped with a broadband 
radiometer. Data from all of the instrumentation are stored on a data 
logger and downloaded over a phone line nightly and stored on a 
database file server.
    The USDA requested that a UVB radiation monitoring program be 
designed to include the agricultural areas of the U.S., to provide 
information to support UVB effects research and to serve as an ``early 
warning'' system for agriculture. Subsequently, realizing that such a 
network could serve a broader role for the benefit of the American 
public, the objectives were expanded to include UVB radiation 
information to support human health studies and atmospheric science 
research related to causes of ozone depletion. Specifically the program 
objectives are to:
  --Provide information to the agricultural community and others about 
        the climatology, geographical distribution and long-term trends 
        in UVB irradiance in order to relate changes in stratospheric 
        ozone to UVB flux at the earths surface, to support research on 
        UVB effects on agricultural crops as well as natural 
        ecosystems, human health and materials.
  --Provide data which will support research to increase our 
        understanding of the factors controlling surface UVB 
        irradiance--serve as ground truth for calculations of UVB 
        irradiance based on radiative transfer model calculations and 
        measurements from satellites--techniques which will aid in our 
        ability to forecast future UVB radiation levels.
    To meet these objectives, the USDA UVB Radiation Monitoring program 
at CSU has established a network to measure UVB radiation along with 
other ancillary measurements required to interpret variations in UVB 
levels. A research effort is necessary to understand the role of ozone 
and other absorbing gasses, as well as scattering by clouds and 
aerosols (turbidity) in controlling UVB radiation before it is possible 
to forecast the effect of stratospheric ozone changes on UVB levels at 
the earth's surface. This network is providing, for the first time, 
comparable measurements of surface UVB radiation (as well as visible) 
over the continental United States and Hawaii and will eventually 
include Alaska and Puerto Rico if budgets permit. Latitudinal 
differences as well as seasonality of UVB levels are now being 
documented in a standardized manner (See Attachment I). These data are 
now available within one day of collection to the scientific community, 
policy makers and others through a World-Wide-Web server or by 
contacting the monitoring program office. Those interested in only 
viewing the data will find daily plots of UVB radiation measured every 
three minutes. The USDA network is the only network in the U.S. 
providing this information. The USDA UVB Web site address is: http://
uvb.nrel.colostate.edu/.
    Realizing that historical measurements of UVB as well as many 
contemporary measurements both in the U.S. and internationally have 
suffered from inadequate instrumentation and lack of attention to data 
quality (primarily instrument calibration and documentation of 
procedures), the USDA program has made a major commitment to assuring 
high quality. In order to meet this goal, the program at CSU has a 
staff of nine including quality assurance specialists, fields 
technicians, computer programmers, and scientists to assure that the 
production of data is of the highest possible quality. This effort has 
resulted in 95 percent data capture from all sites which is not 
duplicated in any other long-term radiation monitoring program. In 
addition, the program has committed over 30 percent of its budget to 
instrument characterization and calibration and partial support for the 
development of a high resolution spectroradiometer. The USDA program 
initiated the development and has provided primary support for a 
national calibration facility operated by the National Oceanic and 
Atmospheric Administration (NOAA) in Boulder, CO, with oversight by the 
National Institute of Standards and Technology (NIST). It has provided 
for the development of a high-resolution spectroradiometer to serve as 
a reference instrument, six of which will be placed at research sites 
to validate the performance of the climatological network instruments, 
to provide the most reliable information to access trends, and to 
provide high resolution spectral data to serve additional research 
needs. The first of the high resolution spectroradiometers has been 
installed at a NOAA/NIST research site north of Boulder Colorado. The 
specifications and quality of this spectroradiometer far exceeds that 
of any other instrument in the world. This phase of the program is 
under the direction of Dr. Lee Harrison at the Atmospheric Sciences 
Research Center, SUNY, Albany, NY.
    In 1997, the USDA UVB Radiation Monitoring Program Web site was 
accessed by 5,130 users who remained on the site for one hour or more 
or who downloaded data. For example, U.S. government accounted for 276, 
higher education, 814, U.S. commercial, 974, and international, 1,105. 
It should also be noted that the ancillary measurements taken at each 
site to aid in interpretation of the UVB radiation levels are also of 
primary interest to other scientists--primarily NASA, DOE, and NOAA--
interested in measuring turbidity (aerosols). Joint research programs 
have been developed with these agencies. The U.S. Weather Service 
(NOAA) is using the data to validate the forecasted UV Index and NASA 
to validate satellite measurements (see Attachment II). To assure data 
comparability with Canada, two sites have been collocated with the 
Canadian UVB monitoring network. This will permit the development of a 
North American data base. A research site at Mauna Loa Observatory, 
Hawaii permits additional comparisons and joint studies not only with 
Canadian but also with New Zealand programs. In addition, the USDA 
program maintains close cooperation with NOAA and the Environmental 
Protection Agency through instrument collocation.
                              Attachment I
                           current data uses
UV Radiation Measurements
    1. Validate UV Index (US Weather Service)
    2. Study of large smoke events (with NASA)
    3. Validate TOMS satellite UV irradiances (NASA)
    4. Urban pollution studies (California Air Resources Board)
    5. Studies of plant canopy penetration (U. of Nebraska)
    6. Establish background levels for effects Research (Utah State 
Univ., USDA/ARS at Beltsville, MD)
Visible Radiation Measurements
    1. Aerosol optical depths (NASA and DOE)
    2. Corrections for remote sensing of vegetation reflectance (USDA 
project by Boeing)
    3. Studies of cloud transmission (NASA)
    4. Study of large smoke events (with NASA)
                             Attachment II
    advantages of ground-based measurements of uv versus satellite 
                               retrievals
    1. Ground-based (GB) UV radiometers actually measure UV irradiance 
at the earth's surface. Satellites like TOMS measure back-scattered UV 
and use a model to infer UV irradiances. The models need input on 
aerosol and cloud properties which are limited.
    2. GB UV radiometers make measurements continuously whereas 
satellites make at most a few overpasses near local noon. Therefore, GB 
measurements of daily totals are much more accurate than satellite 
retrievals.
    3. Satellite footprints are typically 50 x 50 km. A satellite is 
therefore unable to distinguish sub-pixel inhomogeneity due to spatial 
variations in cloud, aerosol, albedo. This often results in inaccurate 
satellite retrievals of GB UV.
                                 ______
                                 
               Prepared Statement of Columbia University
    Mr. Chairman, and Members of the Subcommittee, thank you for the 
opportunity to submit a statement for inclusion in the hearing volume 
for outside witnesses. My statement concerns USDA fiscal year 2000 
funding related to climate change. USDA's Budget Request includes 
$15,300,000 for research in support of Global Change Research. An 
existing institution, the International Research Institute For Climate 
Prediction (IRI), through a Cooperative Agreement with NOAA of the 
Department of Commerce, has conducted a great deal of the research in 
the USDA proposal. Moreover, the IRI has begun three interrelated 
projects in water, agriculture and health from which USDA could benefit 
in their proposed fiscal year 2000 program. This statement provides a 
brief outline of IRI activities, and makes the case for IRI involvement 
in USDA's global change research program. Our joint effort will promote 
cooperation and collaboration and encourage the avoidance of 
duplication of effort.
    Columbia University and the IRI support full funding of the fiscal 
year 2000 USDA initiative for Global Change Research. The proposal is 
based on sound scientific and public policy principles. With the 
results of the proposed plan of research, USDA will contribute to the 
body of knowledge on climate change and provide better tools for 
decision making.
   the international research institute for climate prediction (iri)
    Columbia University's Lamont-Doherty Earth Observatory (LDEO), in 
conjunction with The Scripps Institution of Oceanography (SIO) of the 
University of California at San Diego, has entered into a Cooperative 
Agreement with NOAA to establish and manage the International Research 
Institute for Climate Prediction (IRI).
    The IRI's mission is to provide experimental climate forecast 
guidance on seasonal-to-inter annual time scales for use by affected 
communities around the world. Working with an extensive network of 
domestic and international research and applications centers worldwide, 
the IRI will provide the necessary scientific institutional focus for a 
multi-national ``end-to-end'' prediction program. This ``end-to-end'' 
prediction program supports the development and production of forecasts 
of changing physical conditions (temperature and precipitation) on 
year-to-year time scales, assessments of the regional consequences of 
those variations, and the application of this information to support 
practical decision making in critical sectors such as agriculture, 
water resources, fisheries, emergency preparedness, and public heath 
and safety.
                      fiscal year 1999 activities
    The fiscal year 1999 program level for the IRI (through Department 
of Commerce funding) is $6 million. Since the IRI was initially funded 
by NOAA, Columbia and Scripps have invested heavily in capital and 
research efforts. The ratio of private to public investment has been on 
the order of 3 to 1. The fiscal year 1999 Appropriations Act was the 
first year in which the Congress fully funded NOAA's request for the 
Office of Global Programs, through which the IRI receives Federal 
funding. The realization of the severity of impact that climate events 
can cause was demonstrated by the 100-year El Nino of 1997-1998. The 
back-to-back occurrence of this year's 50-year La Nina will further 
demonstrate our vulnerability to climate variability.
    The IRI has conducted several studies over the past five years 
through contract with prominent agricultural economists for impact 
assessments and analyses of climate change on US agriculture. The 
economists who conducted the studies previously occupied senior level 
positions in USDA as policy and program officials. They possess 
credentials as highly respected academics as well as public policy 
practitioners.
    The IRI has expertise and experience in the areas of proposed 
research that USDA has outlined in the fiscal year 2000 Budget Request. 
The IRI offers to collaborate with the USDA effort, and assist USDA 
officials in launching the projects where IRI expertise would be 
helpful.
    The IRI has incorporated the findings and results of these studies 
into a program of work that will move the use of science to a new 
stage. The focus of the IRI applications will be in the interrelated 
areas of water, agriculture, and health. A discussion of this 
integrated effort follows.
                         project participation
    In 1999, the IRI will progress to a new phase of research. The 
research from this growth will focus on the integrated modeling of 
water, agriculture, and public health. Because the IRI modeling deals 
primarily with temperature and moisture, the link of water modeling 
with agriculture and health modeling can be accomplished by building on 
the same database and utilizing similar approaches.
    The most complex modeling relates to water modeling. It is the 
basis and foundation, however, of the agriculture modeling, and must be 
developed prior to agriculture modeling. Once the water modeling has 
been developed, and trial forecasts have validated the model, the 
agriculture modeling component can be built as a component to the water 
model.
    This ambitious multifaceted modeling project will provide a unique 
contribution to climate change studies world-wide. Because the IRI 
specializes in end-to-end inter annual to seasonal forecasts, the water 
and agriculture models that will be developed will be resource for 
regional and country forecast efforts. As USDA begins to develop the 
agriculture assessment and impact analysis, the IRI could become a 
valuable tool toward more conclusive research.
                   world supply and demand estimates
    For operational purposes, and USDA's statutory responsibilities for 
providing world supply and demand estimates, USDA could make good use 
of the IRI's improved modeling on moisture and temperature. The longer 
lead time on climate variability, with a higher degree of accuracy, 
could provide governments and private decision makers improved 
knowledge on probable growing conditions. With this improved source of 
information, more accurate forecasting could result in reduced famine, 
timely shipments for international trade, and more stable world 
commodity markets. The improved IRI modeling will permit rationale 
agricultural decisions based on information and more certain 
probabilities, rather than speculation based on guesses.
                            funding request
    The IRI effort cannot proceed without some infusion of Federal 
funds. For this reason, and for the programmatic relevance to USDA's 
efforts outlined above, The IRI respectfully requests $300,000 in 
support from USDA for fiscal year 2000.
                               conclusion
    Mr. Chairman, the IRI could provide a great deal of expertise and 
assistance to USDA if involved in the USDA Climate Program initiatives 
in fiscal year 2000. The IRI has the unique responsibilities in climate 
change forecasting necessary to conduct USDA's million. The new 
initiatives in water and agriculture modeling will be of great use to 
USDA in fully completing the agriculture assessment in fiscal year 2000 
and beyond. If the IRI were to be a part of the USDA effort, it is 
estimated that the costs associated with participation would total 
$300,000 in fiscal year 2000.
    Thank you for the opportunity to present this statement for the 
Committee's consideration in funding decisions you will make for the 
fiscal year 2000 Agriculture Appropriations Act.
                                 ______
                                 

 Prepared Statement of the Council on Food, Agricultural and Resource 
  Economics (CFARE) and the Consortium of Social Science Associations 
                                (COSSA)

    Mr. Chairman and members of the subcommittee, it is a pleasure to 
submit this testimony to you on behalf of the Council on Food, 
Agricultural and Resources Economics (C-FARE) and the Consortium of 
Social Science Associations (COSSA). C-FARE is a non-profit association 
actively working to represent the agricultural economics profession in 
matters of science policy, priority setting, and budget determination 
at the federal level, and to collaborate with other agricultural 
science groups and government agencies in these activities. COSSA is an 
advocacy organization supported by over 100 professional associations, 
scientific societies, universities and research institutes, that 
promotes attention to and federal funding for the social and behavioral 
sciences.
    Our recommendations are summarized below:
    1. Promote and support accountability for USDA programs by 
providing funding for an innovative study on performance measurement 
guidelines for agricultural research, extension and education programs. 
Such a study was authorized in Title VI, Subtitle C--Studies, Section 
631 of the Agriculture Research, Extension and Education Reform Act of 
1998, and would cost less than $500,000.
    2. Increase social science funding within the National Research 
Initiative Competitive Grants Program (NRI). Double funding for the 
Markets, Trade and Rural Development Division to $9.2 million. And, 
increase the Natural Resources and the Environment Division to $32 
million to generate new knowledge about the economic and social 
consequences of environmental regulation. We support increasing funding 
for the NRI to a total of $200 million.
    3. Further expand competitive research grants programs at USDA by 
either: (1) allowing $120 million in funding for The Initiative for 
Future Agriculture and Food Systems, or (2) expanding the NRI to $320 
million by targeting $120 million towards integrated critical and 
emerging issues on topics related to biotechnology, genomics, food 
safety, natural resources and the environment, farm efficiency and 
profitability, and precision agriculture.
    4. Increase support for USDA agencies that promote the development 
and use of economic and social science tools to guide decision making.
  --Increase the Economic Research Service budget for research and 
        analysis to $60 million, plus $14 million to evaluate the food 
        and nutrition programs.
  --Increase the National Agricultural Statistical Service budget to 
        $86 million for agriculture estimates and research, and $17 
        million for periodic Census of Agriculture.
  --Increase the Natural Resources Conservation Service (NRCS) Budget 
        to $1,415 million to maintain existing programs, and enhance 
        economic and social science analysis.
    5. Increase funding for the Cooperative State Research, Education 
and Extension Service base research and extension programs by $40 
million (includes Hatch Act, McIntire-Stennis, Evans-Allen, Animal 
Health, Smith-Lever Formula 3 (b) and (c), 1890 Colleges and Tuskegee).
    Recommendation One: Promote and support accountability for USDA 
programs by providing funding for an innovative study on performance 
measurement guidelines of the agricultural research, extension and 
education programs. Such a study was authorized in Title VI, Subtitle 
C--Studies, Section 631 of the Agriculture Research, Extension and 
Education Reform Act of 1998.
    Research accountability, assessment, evaluation, and impact 
analysis are receiving considerable attention in light of pressures on 
public budgets, a need to link benefits with costs, and the search for 
better strategic planning of research and education. Despite the 
Government Performance and Results Act of 1993 and ongoing USDA 
responses, no clear consensus exists about the most effective 
approaches to evaluate agricultural research, extension and education 
programs supported by USDA or within the land grant system.
    A special study is needed to produce a consensus-based set of 
guidelines to evaluate the performance of agricultural research, 
extension and education programs. These guidelines should cover the 
spectrum from broad programs to specific projects and activities, basic 
to applied work, and across the social, biological and physical 
sciences. The guidelines should also address research evaluation on 
both ex-ante and ex-post bases, as well as progress toward goal 
attainment during the research process. The study team should draw from 
recognized university experts and USDA representatives implementing 
GPRA.
    Recommendation Two: Increase social science funding within the 
National Research Initiative Competitive Grants Program (NRI). Double 
funding for the Markets, Trade and Rural Development Division to $9.2 
million. And, increase the Natural Resources and the Environment 
Division to $32 million to generate new knowledge about the economic 
and social consequences of environmental regulation. We support 
increasing funding for the NRI to a total of $200 million.
    We urge you to double the amount of spending in the Markets, Trade 
and Rural Development Division of the National Research Initiative from 
$4.6 million to $9.2 million. The economic and social research funded 
in this division develops new knowledge and enhances our understanding 
of the economic and social forces on our agriculture and food system. 
The research is of high quality and value.
                   highlights of nri-funded research
International Trade Liberalization and Global Competitiveness
    Research on international trade liberalization and global 
competitiveness has greatly improved our understanding of the demand 
for US products and how to access it. There is an improved 
understanding of the costs and benefits of increased trade, and of 
different kinds of trade restrictions imposed by the U.S. and other 
countries. Innovative policies have been studied to estimate how to 
stimulate demand for U.S. agricultural exports and, consequently, 
improve farm income. We also have an improved understanding of currency 
volatilities and other pitfalls of globalization and expanded trade.
Risk Management Policies and Programs
    NRI-funded economics research has made substantial and important 
progress in analyzing existing and new insurance programs that may help 
producers protect themselves against crop and revenue losses. 
Innovative credit programs have been developed, and incentives for 
supply management programs have been analyzed.
Understanding the Implications of an Industrializing Agricultural 
        Sector
    Through NRI-funded economics and social science research we have a 
better understanding of the economic drivers of increasing 
consolidation of production units, and greater coordination and 
concentration among stages of the food system. Social science research 
is helping producers and others understand how to survive and take 
advantage of change, whether through contracts, alliances, cooperative 
arrangements or other innovative business forms. Agriculture's 
relationships with the environment, communities and independent farmers 
have changed with the structure of agriculture. To understand these 
changes, we need more economics and social science research.
    We support an increase in funding for the Natural Resources and the 
Environment (NRE) Division of the NRI to $32 million with the following 
caveat: the increased funds will be used to generate new knowledge 
about the economic and social consequences of environmental regulation. 
This recommendation is consistent with the number one research priority 
generated by a national priority-setting activity conducted by 
scientists involved in and stakeholders of our food and agriculture 
system.
    In its current form, the NRE Division of the NRI supports virtually 
no social science research. In 1996 (the most recent year complete data 
are available), only one project of 96 had any social science 
involvement. In addition, only 7 percent of the projects funded 
involved interdisciplinary teams usually defined as teams of applied 
biologists, microbiologists and molecular biologists. This narrow 
definition limits our ability to solve important economically- and 
socially driven problems in the agriculture and food system.
    Recommendation Three: Expand competitive research grants programs 
at USDA by either: (1) allowing $120 million in funding for The 
Initiative for Future Agriculture and Food Systems, or (2) expanding 
the NRI to $320 million by targeting $120 million towards critical and 
emerging issues on topics related to biotechnology, genomics, food 
safety, natural resources and the environment, farm efficiency and 
profitability, and precision agriculture.
    Increased spending on agricultural research is the cornerstone of a 
productive and profitable agricultural sector. Current estimates of the 
rate of return on public spending on agricultural research, education 
and extension are extremely high (40-60 percent per year or higher). A 
recent report by the Economic Research Service finds that 75 percent of 
the productivity gains in agriculture can be traced to public spending 
on agricultural research.
    Economic and social science research is needed in the following 
priority areas.
    Develop New Knowledge About Economic and Social Consequences of 
Environmental Regulation.--Economics and social science research 
programs are needed to: (1) enhance existing and develop new methods to 
assess the benefits and costs of government regulation, (2) develop, 
design and evaluate integrated policies and institutions to mitigate 
negative environmental impacts of production agriculture, and (3) 
expand scientific knowledge about quantitative and qualitative 
assessment tools that can be applied to non-market goods.
    Enhance Knowledge and Improve Understanding of the Economic and 
Social Impacts of Biotechnology and Genomics.--Economists and social 
scientists can develop integrated models to analyze how biotechnology 
affects farm size, production efficiency, competitiveness, trade 
potential, and other elements of economic performance in agriculture. 
Economics can be used to understand how the consolidation among 
agricultural chemical, seed and biotechnology companies will affect 
producers, consumers and environmental quality. Economic and social 
science research methods can promote understanding of how changes in 
the industry will affect the types of technologies produced and who 
benefits from these products.
    There are at least three important contributions economists and 
social scientists can make to a national genomics research program. 
First, economic methods can be developed to help select target species 
for gene sequencing. Second, economic models can be developed to answer 
questions about the trade-offs consumers are willing to make between 
food characteristics such as taste, nutritional value, and shelf life. 
Third, the social sciences can examine and develop new knowledge about 
the potential social, economic and ethical consequences of various 
types of genomics research.
    Expand the Science and Application of Economics to Improve Food 
Safety.--Economics can improve our understanding of the benefits and 
costs of options to reduce food borne illness from pathogens, and 
pesticide residues in fresh and processed foods. Agricultural 
economists can generate new knowledge about how changes in consumer 
demand affect food safety, health and nutrition. Economic models could 
then be developed to evaluate the effectiveness of public and private 
efforts to promote safer food production, transportation, handling and 
preparation.
    Improve Farm Income and Risk Management Tools: Farm Efficiency and 
Profitability.--Agricultural economics research can improve the 
efficiency of farm income and risk management tools. Economics can 
enhance our understanding of how to measure and manage risk in a new, 
globalized, vertically coordinated food system for an expanded 
clientele base. Economics can be used to develop new knowledge about 
risk management strategies, instruments, and portfolios and adapt them 
to meet current challenges with in the agriculture sector. Finally, 
economics can improve producers' ability to manage complex financial 
accounting and reporting systems.
    Examine the Impacts of the Changing Farm and Agribusiness 
Structure.--The impacts of the changing farm and agribusiness structure 
are profound. Economic and social science research can improve our 
understanding of the forces driving structural change and 
concentration, and the impacts of this change on the economic 
performance of vertically coordinated farming and agribusiness. 
Economic and social science models of vertically coordinated systems 
can answer important questions about market access, bargaining power, 
concentration, location of production, financial arrangements, rural 
communities and the environment.
    Recommendation Four: Increase support for USDA agencies that 
promote the development and use of economic and social science tools to 
guide decision making.
    Increase the Economic Research Service (ERS) budget for economic 
analysis and research to $60 million, plus $14 million to evaluate the 
food and nutrition programs. ERS is the principal intramural social 
science research agency for USDA. ERS provides timely short and long 
run economic and social science information and analyses to public and 
private sector decision makers including farmers. The trend towards a 
more market-driven agricultural sector heightens the needs for 
increased spending on economic and social science analysis and 
research. Sixty million dollars for economic analysis and research is 
needed to maintain innovate, on-going programs and to support a number 
of critical initiatives such as carbon sequestration research, global 
climate change, enhanced commodity market analysis, and addressing the 
information needs of small and limited resource farmers.
    We ask that you continue giving ERS the responsibility and funding 
for Food Assistance Program Evaluation. We believe that program 
evaluation and analysis will be most effective when it is conducted and 
managed by an agency separate from the one implementing the program 
itself. An increase to $14 million in funding for fiscal year 2000 will 
greatly improve basic knowledge and understanding of the forces 
affecting poverty, the impacts of welfare reform, the long-term effects 
of assistance programs, and waste, fraud and abuse in the food stamp 
program.
    Increase the National Agricultural and Statistical Service (NASS) 
Budget to $86 million for agriculture estimates and research, and $17 
million for the periodic census of agriculture. NASS provides the 
official USDA production, economic, and environmental forecasts and 
estimates on agriculture and rural America. NASS' objective and 
accurate statistical information is highly valued by stakeholders of 
the agricultural research and education. A funding increase is needed 
to maintain and enhance existing programs, and to support new 
initiatives such as the Agricultural Economics and Land Ownership 
Survey, the establishment of a field office in Puerto Rico, and an 
expansion of the pesticide use survey to include commercial nursery and 
greenhouse operations.
    Increase the Natural Resources Conservation Service (NRCS) Budget 
to $1.415 billion to maintain existing programs, and enhance economic 
and social science analysis. NRCS provides national leadership in 
partnerships to help people conserve, improve, and sustain the Nation's 
natural resources and environment. NRCS technical experts help land 
managers and communities take a comprehensive approach in planning the 
use and protection of soil, water, and related resources on private and 
non-Federal lands, in rural, suburban, urban, and developing areas. A 
funding increase is needed to enhance Conservation Technical Assistance 
programs to meet increased demand for conservation services. This would 
include economic analysis of resource problems associated with 
conservation assistance for animal feeding operations, non-point source 
pollution, misapplication of fertilizers and pesticides, and land use 
changes. Increased funding is also needed for economic and social 
science analysis of thousands of important watershed dams that will 
reach the end of their design life this decade.
    Recommendation Five: Increase funding for Cooperative State 
Research, Education and Extension Service base research and extension 
programs by $40 million (includes Hatch Act, McIntire-Stennis, Evans-
Allen, Animal Health, Smith-Lever Formula 3 (b) and (c), 1890 Colleges 
and Tuskegee).
    An increase in base research and extension programs is needed to 
maintain and enhance mission-linked multi-disciplinary, multi-function 
projects and programs in a number of critical and emerging areas. For 
example, integrated research, extension and education programs are 
needed to address problems and challenges related to the changing 
structure of American agriculture, agricultural genome and germplasm 
preservation, expanded food nutrition and education programs, 
agricultural waste management, water quality, carbon sequestration, and 
children, youth and families at risk.
    Base programs are an important and productive component of the 
federal research, education and extension system. Combined with other 
federal funding mechanisms such as competitive and special grants, base 
programs have provided state experiment stations and extension systems 
with an effective balance of resource stability, flexibility in 
planning, regional collaboration, and a linkage between national and 
local priority setting.
    Thank you for the opportunity to present these views. Please 
contact us with any questions. Tracy Irwin Hewitt, Executive Director, 
C-FARE, 703-524-2145; Peter Barry, Chair, C-FARE, 217-333-1827; Howard 
Silver, Executive Director, COSSA, 202-842-3525.
                                 ______
                                 
Prepared Statement of the Cosmetic, Toiletry, and Fragrance Association
    The Cosmetic, Toiletry, and Fragrance Association (CTFA) \1\ 
respectfully urges you to grant the Food and Drug Administration's 
fiscal year 2000 budget request for $5.2 million for the Office of 
Cosmetics and Colors in the Center for Food Safety and Applied 
Nutrition (CFSAN). This level of funding is comparable to that provided 
by the Congress for fiscal year 1999 and includes a restoration 
approved by Congress last year of $2.5 million that the administration 
had proposed in cuts for the Office. We believe that it will enable the 
agency to maintain in CFSAN the kind of credible cosmetic regulatory 
program needed to ensure confidence in the safety of cosmetic products.
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    \1\ CTFA is the national trade association representing the 
cosmetic and personal care product industry. Founded in 1894, CTFA has 
an active membership of more than 285 companies, which manufacture or 
distribute the vast majority of the finished cosmetic and personal care 
products marketed in the United States. The Association also has 
approximately 300 associate members, which provide services, equipment, 
or supplies, such as raw materials and packaging components, to our 
active members.
---------------------------------------------------------------------------
    CTFA members provide consumers with a wide variety of safe cosmetic 
products, such as makeup preparations, shampoos, deodorants, 
toothpastes, mouthwashes, perfumes, shaving creams, and skin lotions. 
These products promote personal hygiene. They help people look and feel 
their best, thereby increasing self assurance and self esteem. 
Virtually every man, woman, and child in this country uses cosmetics 
routinely. Because of FDA's effectiveness and the voluntary safety 
programs undertaken by the cosmetic industry--often with the agency's 
cooperation and participation--they do so safely and with confidence. 
Failure to fund the agency's Office of Cosmetics and Colors adequately 
would undercut a vital component of a safety system that serves 
consumers well.
    Moreover, the economic well-being of the $25 billion cosmetic and 
personal care product industry depends on a strong FDA regulatory 
program. Our industry relies on the FDA compliance function. Without 
compliance, unscrupulous competitors can not only defraud the public, 
but undermine legitimate industry as well. The cosmetic industry needs 
a level playing field. We need to know what regulatory requirements 
apply. We want to be certain that the FDA law and regulations will be 
enforced consistently against all marketed products, whether imported 
or produced domestically.
    A strong FDA Office of Cosmetics and Colors exerts national 
leadership, maintains appropriate standards to assure the safety and 
proper labeling of cosmetics throughout the nation, and ensures that 
Americans can enjoy a nationwide marketing system with adequate public 
protection and uniform enforcement in every part of the country. If the 
FDA's cosmetic program were diminished, the states might be encouraged 
to ignore the agency and establish their own, potentially conflicting, 
regulatory requirements for cosmetics. Such a patchwork of state 
mandates could only confuse consumers and wreak havoc on our industry's 
ability to operate in interstate commerce.
    The FDA is currently recognized as the preeminent international 
body in the field of cosmetic regulation. A visible and vigorous Office 
of Cosmetics and Colors is necessary to maintain this international 
leadership and to move even more quickly toward the goal of 
international harmonization, which the Congress established as an FDA 
priority for cosmetics and other regulated products under Section 410 
of the FDA Modernization Act of 1997.
    We are not asking for increased funding or new programs. We are 
merely seeking the continuation of a level of stable funding for the 
Office of Cosmetics and Colors that will help ensure the maintenance of 
an effective FDA regulatory program for cosmetics. We strongly support 
the FDA's fiscal year 2000 budget request for $5.2 million for the 
Office of Cosmetics and Colors. Thank you for considering our views.
                                 ______
                                 
Prepared Statement of the Council for Agricultural Research, Extension, 
                              and Teaching
    Thank you, Mr. Chairman. I appreciate the opportunity to again 
provide testimony this year in support of the Land-Grant system.
    My name is Sam Minor, Chairman of the Council for Agricultural 
Research, Extension, and Teaching, commonly called CARET. CARET is a 
national focal group of lay support persons working on behalf of the 
land-grant university system. The CARET group was formed a number of 
years ago for the expressed purpose of enhancing national support and 
understanding of the important role played by the land-grant colleges 
in the food and agriculture systems, as well as the role of this system 
in enhancing the quality of life for all citizens of the nation.
    As I have emphasized in each of the last two years in which I have 
given testimony to the Congress, I take part in this activity with a 
great amount of pride and commitment. Our family and I know first hand 
of the important role played by our land-grant institutions.
    I do not want to again take your time this year in discussing all 
of the contributions that the land-grant system has made to us as a 
family or to our farming and farm retail business. I would, however, 
want to emphasize that this contribution has been very significant. The 
same can be said about the contribution of our land-grant universities 
to hundreds of thousands of farm families across this country.
    The land-grant system is a very unique system of research, 
education, and extension. It is a system that has brought together a 
partnership of federal, state, local (or county), and now private 
resources to contribute so significantly to building an agricultural 
industry that is truly the envy of the world. This system, this 
agricultural industry, at the national level continues to have a 
tremendous impact on our economy, our balance of trade, our workforce, 
and the health and quality of life of our society. Yet, in many ways, 
it is an industry that is taken for granted.
    Too little do we hear or talk about the significance of the 
research and education that has provided the scientific basis to allow 
1.8 million U.S. farms, such as ours in southwestern Pennsylvania, to 
produce a record in excess of $200 billion of food and fiber. Too 
little do we recognize the records that have been set in export 
agricultural sales that have contributed so significantly to a positive 
balance of agricultural trade. To infrequently do we acknowledge that 
this food and agriculture industry provides almost 20 percent, one out 
of every five, of the jobs in this country and accounts for 16 percent 
of our gross national product. Yet, the consuming public spends less of 
their disposal income, just over 10 percent, for their food needs than 
any other country in the entire world. I do recognize that these are 
familiar numbers. They do, however, continue to be significant today.
    Now, as we have entered a new era in agriculture and the role that 
government plays in this industry, we believe that the need for an 
agriculture that is based on research and science is greater than ever 
before.
    We are, for many reasons, in a very rapidly changing agriculture. 
Some call it an industrialization of agriculture. We are seeing a 
consolidation of our agriculture enterprises. This is occurring at the 
farm level and in our processing and distribution systems. This change, 
this consolidation, this industrialization, is today having a 
tremendous impact on farm families, farm businesses, and rural 
communities across this country. The significance of this impact will 
be even greater in the weeks and months ahead.
    The impact of these changes has been even further accentuated as we 
are experiencing the affects of lessened government participation in 
the pricing mechanism. And this is all occurring at a time when we are 
experiencing considerable destabilization of the financial markets in 
many parts of the world. Some are now beginning to talk about the 
reoccurrence of a ``farm crisis.'' It is apparent that consideration at 
the federal level is being given to ways to assist during this 
transition period.
    As we go through this transition period we are seeing a rapid 
implementation of new emerging technologies. Information of all kinds 
that enhances the ability to make more rapid and more correct decisions 
is increasingly available. New plant and animal species, varieties, and 
characteristics are emerging from the rapid advancement of the 
biotechnological sciences. These changes and advancements have come 
about, to a very great extent, because of the past investment in 
agriculture research and education, much of it from public sources.
    As we consider this transition in the framework of new work that is 
now being done and the new scientific advancements that are just on the 
threshold of disclosure, one has to think that our opportunities are 
greater today than at any time in the past. It will, however, take 
dollars to bring these opportunities to fruition. It will be a 
continuation and expansion of the federal, state, local, and private 
partnership that can best provide these dollars critically needed for 
this work. Your decisions in the coming months to increase the federal 
outlay for agricultural research can provide some much needed 
leadership for this effort. The federal funds are the heart of this 
partnership.
    Specifically, the federally-supported programs in cooperation with 
our state land-grant colleges and universities are crucial for us to 
retain and expand the U.S. competitive edge in the world-wide 
marketplace. Additionally, these research and extension programs that 
result from this federal, state, local, and private partnership are 
very crucial at this time to assure strength and stability at the 
family farm level and to assure continuity in our rural communities.
    This testimony is principally to request support for the fiscal 
year 2000 budget recommendations of the National Association of State 
Universities and Land-Grant Colleges' (NASULGC) Board on Agriculture of 
$1.098 million, an increase of $174.2 million. This increased amount is 
consistent with the amount of increase proposed in the President's 
proposed budget for the fiscal year 2000 for the Cooperative State 
Research, Education, and Extension Service, U.S. Department of 
Agriculture (CSREES, USDA). We strongly endorse this critically needed 
added investment.
    While we do endorse the President's proposed increase, we are 
recommending a different mix of funding mechanisms that we feel will 
best address the critical issues that need to be addressed in fiscal 
year 2000. We do recognize that at this stage there is not complete 
agreement between the Administration, the Congress, and all interested 
stakeholders on how this increased funding should be best structured. 
Most important, however, is that there is an immediate, urgent need for 
this additional ``critical issue''-oriented research, extension, and 
education funding.
    In saying this, we do realize that the Congress is facing a tight 
fiscal year and that the House and Senate Agricultural Appropriations 
Subcommittees will address a number of complex and challenging issues 
facing farmers, ranchers, and rural communities. However, there is no 
doubt, from our experience, that these targeted investments proposed 
for the land-grant system is one of the very best ways to address these 
challenging problems in the long run.
    After a great amount of interaction with the land-grant system and 
a broad number of stakeholders from the agriculture community the 
NASULGC Board on Agriculture Budget Committee has some 22 critical 
issues that have been identified for special emphasis in this fiscal 
year 2000 budget request. These issues have been organized within the 
five goals developed by the Department of Agriculture as part of their 
process for responding to the Government Performance and Results Act 
(GPRA). These proposed activities are organized within the five 
categories to facilitate future reporting on accomplishments. This is a 
key component to assure the Congress that these funds are being 
utilized effectively to solve today's most critical problems and to 
best prepare for tomorrow's greatest opportunities.
    To re-emphasize, NASULGC and CARET support the President's bottom 
line of 2.6 percent increased funds for research, education, and 
extension funding. NASULGC does, however, recommend that from this 
increase an additional $40 million go to an increase in base or formula 
funds. Base program funding is unmatched as a vehicle to foster multi-
year programs essential to the science of agriculture. These base funds 
allow the colleges and universities to invest in long-term research 
activities where continuity is critical for success. These funds also 
support the infrastructure and faculty that are necessary for 
successful completion of the research and extension activities. 
Additionally, these base funds are essential for leveraging external 
resources.
    An additional increase of $120 million is also proposed for 
competitive grants. This is very consistent with the President's 
proposed increase in the National Research Initiative. It is also 
consistent with the establishment of the Fund of Rural America two 
years ago and is especially consistent with the new initiative that was 
authorized as a part of the Research and Science (Title VIII) of the 
Farm Bill last year. We do know there may be different thoughts on how 
to work through the grant or funding mechanisms for this expanded new 
competitive funding approach. The Land-Grant University community 
stands ready to work with the Congress to find ways to resolve current 
questions and to effectively utilize the available mix of competitive 
grants programs. Most importantly, there is an immediate and urgent 
need for new, integrated problem-solving competitive grants to address 
real-world problems.
    An additional increase of $14.2 million is also proposed as a mix 
of targeted mechanisms that would provide an opportunity to address 
immediate areas of critical concern.
    The Council on Agricultural Research, Extension, and Teaching is 
very pleased to support this request for an additional funding of 
$174.2 million on behalf of the land-grant university system. This 
land-grant partnership working in close cooperation with the USDA 
Cooperative State Research, Education, and Extension Service is a very 
important and very strong relationship. This is a partnership that 
undergirds the research and science of a successful agriculture in the 
United States, a partnership and an industry that is the envy of the 
entire world.
    This is a partnership that our CARET organization believes should 
be financially supported to the fullest possible extent at both the 
federal and at the state levels. We ask that you give this request your 
fullest possible consideration this year.
    As an individual farmer and a member of the agriculture community, 
I am proud of what the federal, state, and local partnership has 
provided to us. At the same time, agricultural research and education 
must be an important part of our long-term agricultural policy. We must 
continue to strengthen our financial commitment to assure that these 
basic programs of the land-grant system will be prepared to meet the 
emerging needs of the food and fiber sector.
    We in agriculture and the country as a whole want to enhance our 
production, processing, and marketing capabilities. We also want to be 
prepared to take full advantage of the further opening of global 
markets. We in agriculture also want to understand and to effectively 
apply risk management programs to gain the greatest returns from our 
commodities. And we want to be prepared to fully adopt and utilize new 
scientific breakthroughs in the production, processing, and marketing 
of these products. It is also our goal that all of this be done in a 
way that effectively preserves the environment while continuing to 
provide the most nutritious and safe food supply in this country and 
those markets served worldwide. These all provide unprecedented 
opportunity to continue to put science and education to work for 
mankind.
    Thank you for this opportunity to provide this testimony in support 
of the appropriations for our land-grant system.
                                 ______
                                 
      Prepared Statement of the Council for Responsible Nutrition
    Mr. Chairman, the Council for Responsible Nutrition (CRN) 
appreciates the opportunity to testify as the Committee reviews the 
fiscal year 2000 Appropriations for the Food and Drug Administration 
(FDA). CRN represents 100 companies that manufacture dietary 
supplements, including vitamins, minerals, herbs, and botanical 
products. These products account for a large share of the $15 billion 
in sales anticipated for this industry in 1999--products which are used 
by more than half of our nation's population.
    CRN and its members are committed to improving the public's health 
through improved nutrition, including the appropriate use of dietary 
supplements. Like FDA, we are committed to science-based products and 
decisions. We also recognize that even the most responsible industry 
needs fair and appropriate regulations in order to ensure consumer 
protection as well as to encourage good business practices and 
facilitate fair trade. The Food and Drug Administration critically 
needs adequate resources to perform these functions.
    The Dietary Supplement Health and Education Act of 1994 (DSHEA) was 
passed because FDA had, for several decades, pursued a regulatory 
agenda that was not appropriate for dietary supplements. DSHEA 
established a new regulatory framework which is working well, but which 
could work even more effectively if FDA had the resources needed to 
fully implement the intent of Congress. CRN urges Congress to 
appropriate adequate resources to support FDA action in the following 
areas relating to dietary supplements. Urgent needs include:
  --Establishing a Dietary Supplement Advisory Committee.
  --Timely review of 75-day notices for new dietary supplement 
        ingredients.
  --Promulgating Good Manufacturing Practice Regulations appropriate to 
        dietary supplements.
  --Improving the adverse reporting system.
  --Strengthening FDA's capabilities in international regulatory 
        activities.
  --Withdrawing the proposed structure/function rule.
    Allow me to elaborate on these urgent requirements.
           establish a dietary supplement advisory committee
    FDA must deal with a wide variety of critical issues affecting 
dietary supplements. In the past several years, three out of six 
meetings of the existing Food Advisory Committee have been devoted to 
consideration of dietary supplement issues. Unfortunately, the Food 
Advisory Committee does not have the appropriate expertise to deal with 
dietary supplements, and FDA has found it necessary to convene other 
experts to participate in evaluating dietary supplement issues, 
including the safety of ephedra, necessary provisions of Good 
Manufacturing Practices, improving postmarket surveillance, and 
evaluating consumer understanding of dietary supplement labels.
    CRN believes FDA urgently needs a Dietary Supplement Advisory 
Committee, comprised of individuals with a wide range of backgrounds, 
possessing expertise in dietary supplement products and knowledgeable 
about the scientific evidence relating to dietary supplement 
ingredients. Funding to establish, staff, and support this critical 
advisory committee is essential, and should be included in the fiscal 
year 2000 appropriations for FDA.
             review of notices for new dietary ingredients
    DSHEA places a great deal of responsibility on the industry to 
ensure that only safe ingredients are marketed in dietary supplements. 
Ingredients that were marketed in dietary supplements before October 
15, 1994, are ``grandfathered'' and may continue to be marketed. 
However, even grandfathered ingredients may be considered adulterated 
if they are injurious to health or if they are not reasonably expected 
to be safe under the intended conditions of use.
    DSHEA requires any marketer of a new dietary ingredient (one first 
marketed on or after October 15, 1994) to submit a notification to FDA 
at least 75 days prior to marketing. The notification is to include a 
statement of the manufacturer's basis for concluding that the 
ingredient is reasonably expected to be safe. FDA reviews the 
notifications, and the file is placed on public display approximately 
90 days following its receipt.
    For example, a new dietary ingredient notification was recently 
filed for gamma butyrolactone (GBL), a precursor to gamma 
hydroxybutyrate (GHB), a substance with activity similar to the so-
called ``date rape'' drug. Based on the information submitted and based 
on other information available in the scientific literature, CRN 
believes FDA was right to object to the marketing of GBL, and CRN 
supported the agency's recent action in requesting a recall. The 
companies contacted by FDA have apparently complied with the request 
for a recall, but we note that there are still numerous Internet sites 
promoting and selling both GBL and GHB.
    Further actions need to be taken against such marketing, and it is 
essential that FDA have adequate resources to review new ingredient 
notifications and to respond promptly and effectively to curtail the 
marketing of adulterated (unsafe) dietary supplement ingredients.
                      good manufacturing practices
    DSHEA authorized FDA to establish Good Manufacturing Practice (GMP) 
regulations for dietary supplements, modeled after GMP regulations for 
foods. CRN took the lead immediately following DSHEA in drafting 
appropriate GMPs for dietary supplements, based on CRN's existing GMPs. 
CRN invited other associations to join in this effort, and several 
industry groups jointly submitted a GMP draft to FDA in November 1995. 
These GMPs incorporate virtually all provisions of the existing food 
GMPs and would also require every manufacturer to have a strong quality 
control unit with authority to accept or reject bulk ingredients and 
finished products that fail to meet appropriate standards.
    Fifteen months later, in February 1997, FDA published the industry 
draft as an Advance Notice of Proposed Rulemaking and numerous comments 
were received. One year after that date, in February 1998, FDA asked 
its Food Advisory Committee for recommendations regarding certain 
provisions that would be covered by GMPs, including appropriate tests 
for product identity. At that Committee meeting, CRN urged FDA to 
establish a working group including industry members with the necessary 
expertise to consider these issues, and the agency did so. That working 
group has recently submitted its report.
    Mr. Chairman, FDA must have sufficient resources to move this 
process along at a faster pace, so that new dietary supplement GMPs can 
be in place as soon as possible. These GMPs will provide vital consumer 
protection by requiring manufacturers to have adequate procedures in 
place to ensure product quality, as envisioned by DSHEA. While many 
responsible manufacturers already have such procedures in place, it is 
essential to ensure a standard for the industry as a whole.
                        adverse event reporting
    The Office of Special Nutritionals at FDA established an Adverse 
Event Reporting System (AERS) five years ago to compile adverse event 
reports related to medical foods, infant formula, and dietary 
supplements. At this time, there are 2,621 adverse reports in the 
system. Many are minor complaints, but some are serious, and there are 
some reported deaths.
    During 1998, the reports were put on the FDA website. 
Unfortunately, a company can find itself in the position of having its 
company name and brand associated with a serious adverse event posted 
on the Web without having any prior warning that such an event has 
occurred. Further, the background information on the case is unlikely 
to be available under FOIA, because FDA does not have adequate staff to 
purge personal case information not releasable under FOIA. In addition, 
FDA does not have adequate staff or other resources to properly 
evaluate the adverse event reports, and the reports are released with 
no comment regarding the likelihood of any actual causal relationship 
between the product named and the event which occurred. This puts every 
company at risk of being held ``guilty until proven innocent,'' without 
investigation. The industry is at risk of being charged with causing a 
large number of adverse events, many of which may be minor complaints 
and many of which may not in fact be due to dietary supplement use.
    It is essential that some scientific evaluation be applied to the 
adverse event reports dealing with dietary supplements, in order to 
identify those areas where a genuine safety issue exists, so that FDA 
and industry can take appropriate action. Criteria have already been 
established for determining the likelihood of a causal relationship 
between a product and an adverse event, and FDA applies such 
evaluations in some other product areas.
    For example, FDA received about 3,000 adverse event reports in 1997 
regarding veterinary drugs. Scientific evaluation revealed that only 1 
percent of the veterinary adverse events were definitely associated 
with product use; 31 percent were probably associated, 45 percent were 
possibly associated, and 12 percent were definitely not related to the 
product. In 11 percent of the cases, there was inadequate information 
to evaluate likely causality. A similar analysis of the adverse event 
reports on special nutritionals would be valuable in better 
understanding the likelihood of a causal relationship between the 
dietary supplements used and the adverse events reported. Criteria used 
in evaluating likely causality include whether the effects are 
consistent with the known pharmacology of the product, whether there 
are other explanations for the event, whether the timing of the event 
suggests a relationship to use of the product, and whether the effects 
went away when use of the product was stopped or reappeared if the 
product was given again.
    It is essential for FDA to have sufficient resources to update the 
special nutritionals adverse event reporting system on a regular basis 
and to be able to screen and release background information on the case 
reports before they are made publicly available. Finally, FDA must have 
the capacity to evaluate the likely association between the events that 
occurred and the products that were used.
                  fulfilling international obligations
    FDA currently participates in many international policy-setting 
activities, and sometimes leads the U.S. delegation on specific issues. 
These international efforts, including those relating to the Codex 
Alimentarius, can have a significant impact on world trade, including 
trade involving dietary supplements. CRN is an officially designated 
Non-Government Organization (NGO) at these international meetings and 
has worked with FDA, USDA, USTR, the Department of Commerce, and the 
State Department in developing consensus regarding the U.S. position on 
various issues. To augment current efforts, we strongly urge that FDA 
be provided with the necessary resources to train U.S. delegates in the 
communication and negotiation skills critical for a forum such as 
Codex. Further, we believe that the FDA budget should include funding 
to provide the additional resources required to employ and contract for 
the necessary legal, academic, technical, or scientific expertise to 
supplement delegate skills and substantiate U.S. positions. We also 
urge FDA to fully cooperate with other U.S. agencies and to support 
industry/government dialogue in the international arena such as 
collateral international efforts to regulate dietary supplements by 
playing an active role in the TransAtlantic Business Dialogue (TABD) 
and the Transatlantic Economic Partnership (TEP).
    Mr. Chairman, I would like to comment on the importance of new 
cooperative efforts. The FDA Modernization Act of 1997 (FDAMA) directed 
FDA to work more cooperatively with all of its stakeholders. Now is the 
time for the agency and the dietary supplement industry to begin a new 
era of working together. For its part, CRN is committed to doing 
everything in its power to help FDA obtain adequate funding to fulfill 
its duties under DSHEA, including finalizing GMPs for dietary 
supplements, enforcing the requirements applicable to new dietary 
ingredients, and improving the adverse reaction reporting system.
    FDA would send a powerful signal of goodwill to dietary supplement 
manufacturers and consumers if the agency withdrew or drastically 
modified the March 1998 proposal regarding structure/function 
statements. This proposed rule seeks to define what are permissible 
statements under DSHEA that deal with the structure and function of the 
human body. However, the proposed rule includes an overly broad 
definition of ``disease'' which encompasses many structure/function 
effects. FDA should not interpret ``disease'' so broadly that 
meaningful information about the health benefits of dietary supplements 
cannot be provided, as intended by DSHEA.
    The proposed structure/function rule has drawn a large number of 
comments, including almost 200,000 consumer letters. The overwhelming 
majority of the comments are critical of the proposal. We believe that 
the U.S. Department of Agriculture's response to public comment on the 
misguided ``organic'' proposal would serve as a good model for FDA on 
this issue. As USDA did with the ``organic'' proposal, FDA should 
simply withdraw the structure/function proposal. Instead of creating a 
new regulation, FDA could simply continue to rely on the provisions of 
DSHEA, which clearly states that statements of nutritional support 
cannot mention a disease. Beyond that, all statements that are 
literally about affecting the structure or function of the body should 
be permitted.
    CRN and its member companies appreciate this opportunity to testify 
regarding the urgent need for adequate resources to permit FDA to fully 
implement the intent of DSHEA. We believe responsible regulation 
through DSHEA is needed for the health of the industry as well as the 
health of American consumers, and we support fair and appropriate 
regulation. We would welcome the opportunity to celebrate the new 
millennium by entering into a new era of cooperation with FDA, based on 
mutual respect and grounded in science.
                                 ______
                                 

                   Prepared Statement of Easter Seals

        easter seal recommendations for usda agrability program
    Easter Seals appreciates the opportunity to report on the notable 
accomplishments of the USDA Cooperative State Research, Education, and 
Extension Service (CSREES) AgrAbility Program and to recommend that 
funding for the AgrAbility Program be increased to $4.6 million in 
fiscal year 2000.
    The AgrAbility Program is an essential, unduplicated, hands-on 
resource for farmers, ranchers, and farmworkers with disabilities. It 
is the only USDA program dedicated exclusively to helping agricultural 
producers with disabilities. It demonstrates the value of public-
private partnership by securing donations of funds, talent, and 
materials to magnify the impact of a modest federal investment. The 
fiscal year 1999 appropriation is $2,055,000, which funds 18 state 
programs.
Disability and Agriculture
    Agricultural production is one of the nation's most hazardous 
occupations. Each year, approximately 200,000 people working in 
agriculture experience injuries that limit their ability to perform 
essential farm tasks. Tens of thousands more become disabled as a 
result of non-farm injuries, illnesses, other health conditions, and 
the aging process. Nationwide, approximately 500,000 agricultural 
workers have physical disabilities that prevent them from performing 
one or more essential farm tasks.
    For many of these individuals, the presence of a disability 
jeopardizes their rural and agricultural futures. Rural isolation, a 
tradition of self-reliance, and gaps in rural service delivery systems 
frequently prevent agricultural workers with disabilities from taking 
advantage of growing expertise in modifying farm operations, adapting 
equipment, promoting farmstead accessibility, and using assistive 
technologies to safely accommodate disability in agricultural and rural 
settings. Yet, with some assistance, the majority of disabled 
agricultural workers can continue to earn their livelihoods in 
agriculture and participate fully in rural community life.
AgrAbility's Role and Record of Success
    Since 1991, thirty-one states have been served by AgrAbility 
projects. AgrAbility has:
  --Provided direct on-farm assistance to more than 4,700 farmers, 
        ranchers, and farmworkers with disabilities and their families.
  --Provided information and advice to 10,000 persons with disabilities 
        employed in agriculture and related occupations.
  --Educated more than 160,000 agricultural, rehabilitation, and rural 
        health professionals on safely accommodating disability in 
        agriculture.
  --Recruited and trained more than 3,500 volunteers to assist 
        agricultural producers with disabilities and their families.
  --Reached approximately 8.4 million people through 3,800 exhibits, 
        displays, and demonstrations to increase awareness of the 
        challenges affecting and resources available to people with 
        disabilities who work in agriculture.
    The AgrAbility Program was established under the 1990 Farm Bill in 
response to the needs of farmers with disabilities. The Farm Bill 
authorizes the Secretary of Agriculture to make grants to Extension 
Services for conducting collaborative education and assistance programs 
for farmers with disabilities through state demonstration projects and 
related national training, technical assistance, and information 
dissemination. Easter Seals is proud to be a partner with Purdue 
University's Breaking New Ground Program in providing the national 
training and technical assistance portion of AgrAbility. Thousands of 
people in states with and without state AgrAbility projects are aided 
through this initiative.
    AgrAbility combines the know-how of Extension Service and national 
disability organizations to provide people with disabilities working in 
agriculture the specialized services that they need to safely 
accommodate their disabilities in everyday farm operations. AgrAbility 
received strong bipartisan support during the 1998 reauthorization of 
the USDA research and education programs, and was extended through 
fiscal year 2004. The $6 million authorization level for AgrAbility was 
continued.
    Under the statute, state and multi-state AgrAbility projects engage 
Extension Service agents, disability experts, rural professionals, and 
volunteers in offering an array of services, including: identifying and 
referring farmers with disabilities; providing on-the-farm technical 
assistance for agricultural workers on adapting and using farm 
equipment, buildings, and tools; restructuring farm operations: 
providing agriculture-based education to prevent further injury and 
disability; and, upgrading the skills of Extension Service agents and 
other rural professionals to better promote success in agricultural 
production for people disabilities.
    In 1998, USDA received an allocation of $2,055,000 to support 
eighteen state projects in Colorado, Delaware, Illinois, Indiana, Iowa, 
Kentucky, Minnesota, Mississippi, Missouri, Nebraska, North Carolina, 
North Dakota, Pennsylvania, South Dakota, Tennessee, Texas, Utah, and 
Wisconsin. For the 1998 grant cycle, USDA received applications from 
twenty states for the fourteen available AgrAbility project slots.
    AgrAbility provides customized assistance to farmers, ranchers, and 
farmworkers with disabilities and their families. The nature and degree 
of assistance depends on the individual's disability needs and 
agricultural operation. For example: The Mississippi AgrAbility Project 
has been working with a 23-year old farmer from Bentonia, Mississippi 
who uses a wheelchair because of the effects of Spina Bifda. He works 
on his family's beef cattle and hay operation, and needed help 
continuing to safely and effectively complete all the farm chores. The 
Mississippi AgrAbility Project helped locate hand controls for the 
family's Kawasaki Mule utility vehicle that allow him to remain a vital 
part of the daily farm activities. The state partnership was 
particularly fruitful in this case, because Easter Seals Mississippi, 
the nonprofit disability partner, was able to provide assistance in 
purchasing the hand controls through their Special Assistance Fund. 
This Mississippi AgrAbility project has also partnered with the T.K. 
Martin Center for Technology and Disability to provide assistance to 
this young man regarding accessible and proper seating for farm 
equipment.
    Rodney Lane of Harrison Valley, Pennsylvania has operated a farm in 
the Harrison Valley since 1979. He has a dairy herd and over 500 acres 
of crops. He lost his left arm below the elbow and part of three 
fingers on his right hand in a corn picker accident. He uses a 
prosthesis on his left arm when tending his cows. AgrAbility for 
Pennsylvanians worked with the Pennsylvania Office of Vocational 
Rehabilitation to acquire a mixed ration wagon that eliminates the need 
for multiple trips to and from the grain bin and reduces the need for 
heavy lifting. Rodney has this to say about his modification, 
``Assistive technology has made things easier so that I can farm more 
self-sufficiently.''
    A third generation farmer, Don Wolford of Franklin County, Iowa, 
farms about 1,100 acres, cares for 40 head of beef cattle, finishes 560 
head of hogs, and maintains a 24-stall farrowing building. In 1992, he 
had surgery to remove a tumor along his spine, which left him paralyzed 
from the waist down. AgrAbility staff first met with him in the 
hospital and showed him videos of farmers with disabilities using 
modifications, and recommended modifications he could make to his 
operation. After he returned home, AgrAbility staff wrote a proposal 
that helped get funding for Don to purchase an all terrain vehicle that 
was adapted for him using a kit from the manufacturer in order to 
provide him with a means of moving equipment and supplies on his farm. 
A friend designed hand brakes for both his tractors and pick-ups. 
AgrAbility provided him with plans for installing a lift on his 
tractor, which local welders were able to install. Since his injury, 
Don has been elected president of the Franklin County Farm Bureau and 
named 1997 Franklin County Master Pork Producer. He has also been 
volunteering his time as an AgrAbility peer counselor to help other 
farmers with disabilities in similar situations.
    Ron Brown from Edgar, Wisconsin, sought help from AgrAbility 
because a 1981 injury that limited the use of his arm and arthritis in 
his knees was making it increasingly difficult to accomplish the chores 
on his 40 to 50 head dairy farm. AgrAbility staff worked with Ron and 
enlisted the help of the state Division of Vocational Rehabilitation to 
create solutions to allow Ron to stay active in farming. AgrAbility 
staff recommended new types of equipment to minimize the stress on 
Ron's knees and arm. A John Deere ``Gator'' utility vehicle allows Ron 
to get around the farm easily, helping him herd cows, fix fences and do 
other chores. Ron did some of the modification work himself. The added 
extra steps and handrails he added to his tractors allow him to get on 
and off more easily and safely. Ron says that the partnership has 
helped make farming ``a little better, and easier to do.'' Ron now 
travels the state talking to other farmers with disabilities about 
AgrAbility.
Impact of Current Funding Levels
    AgrAbility projects are underfunded relative to need and objective. 
At $85,000 per state, only a few staff can be hired to provide 
statewide education and assistance to farmers with disabilities, 
educate rural professionals, recruit volunteers, and work with rural 
businesses on disability-related issues. Despite AgrAbility's proven 
record of success, rising demand for services and the great distances 
that must be traveled to reach farmers and ranchers have severely 
strained even the most dedicated of AgrAbility's outstanding staff. 
Easter Seals fears that failure to invest adequately in this worthwhile 
program will ultimately cause it to falter.
    In the 1990 Farm Bill, a funding floor of $150,000 per state was 
set to assure that the state programs were successfully implemented. 
However, because funding has not approached the $6 million authorized 
level, state projects have been funded at only $85,000 per state. In 
the 1998 reauthorization of the USDA research and education programs, 
the Committee reaffirmed a commitment to that $150,000 per state floor. 
Easter Seals strongly supports full funding of state programs to assure 
that they continue to be effective for farmers with disabilities. 
Without a related increase in appropriations, fully funding state 
projects at $150,000 per state would result in a loss of almost half of 
the existing AgrAbility projects. The fiscal year 2000 request of $4.6 
million would bring all current states up to the $150,000 level and 
would allow eight currently unserved states to implement AgrAbility 
programs.
    One of the consequences of limited funding is that in every grant 
cycle, some states that have existing AgrAbility programs, and can 
demonstrate a legitimate need for services, are not renewed and forced 
to discontinue services to farmers with disabilities in that state and 
often have difficulty getting the access to the limited state and 
private funding sources that the federal seed money granted them. More 
than a dozen states have sought AgrAbility funding without success. 
Other states, including Louisiana, Michigan, New Hampshire, South 
Carolina, and Vermont, had USDA-funded AgrAbility projects in the past 
and seek to re-establish their programs. Each of these states can 
demonstrate significant unmet needs among farm and ranch families 
affected by disability that AgrAbility could potentially address. In 
the 1998-1999 grant cycle projects in Ohio, New York, Idaho/Montana, 
and New Jersey ceased to receive federal support. The need for the 
program in these once-funded states is exemplified by the fact that 
last year the technical assistance telephone line operated by 
AgrAbility staff at Breaking New Ground Resource Center at Purdue 
University logged over 268 calls for assistance from these nine states 
alone. Any loss of programs will greatly affect farmers with 
disabilities in states for whom AgrAbility is the primary resource 
through which they seek information and assistance on farming with a 
disability.
    The need for AgrAbility services has never been greater, and its 
accomplishments to date are remarkable by any standard. Easter Seals is 
proud to contribute to the ongoing success of the USDA-CSREES 
AgrAbility Program. Please support the allocation of at least $4.6 
million for AgrAbility in fiscal year 1999 to ensure that this valuable 
public-private partnership continues to serve rural Americans with 
disabilities and their families. Thank you for considering Easter 
Seals' views and recommendations.
                                 ______
                                 
             Prepared Statement of Farm*A*Syst/Home*A*Syst
    Thank you for the opportunity to submit a written statement to the 
Subcommittee on the issue of appropriations for agricultural research. 
education and economics. Our statement will address the importance of 
providing base support to education and other CSREES programs of proven 
merit, the function of GPRA standards in assessing the merits of these 
programs, and the application of GPRA standards to Farm*A*Syst/
Home*A*Syst, an education program that receives funding through CSREES. 
At the outset, we would like to acknowledge the support of the National 
Association of State Universities and Land Grant Colleges and our 
program coordinators in fifty states including Alaska, California, 
Iowa, Illinois, Kentucky, Mississippi, Missouri, Montana, North Dakota, 
Pennsylvania, Washington and Wisconsin.
    There are those who believe that the country can best address a 
host of agricultural concerns including pollution by expanding 
competitively-funded projects at the expense of base funding for 
programs. Certainly projects funded through competitive grants are an 
essential component of research, education and extension, particularly 
when such projects seek to integrate these three activities, but the 
benefits of competitively-funded projects will be greatly diminished 
without adequate support to maintain the infrastructure designed to 
transfer research findings to the agricultural community and provide 
education to improve agricultural practices. This infrastructure was 
built with base support for programs of proven value.
    Without base support for effective programs, there is an inadequate 
framework in place to respond to issues of the moment. For example, the 
newly-crafted AFO strategy has elevated nutrient management to new 
levels of importance. Had Congress failed to make its annual commitment 
to support the national network of Extension specialists and agents, we 
as a nation would not have the ready-made capacity to effectively 
implement this strategy. By providing base support for effective 
programs, moreover, Congress can increase the benefits of 
competitively-funded projects. The latest research findings regarding 
nutrient management would never leave the laboratory without a 
mechanism such as Cooperative Extension to translate research findings 
into information useful to farmers. By shifting funds away from base 
program support, Congress not only dismantles the support system that 
delivers research findings to the public, it reduces the capacity to 
continue projects that have used competitive funds to effectively 
address issues of significance. In regard to the latter situation, 
Farm*A*Syst/Home*A*Syst is in this position, needing base support to 
maintain a national network of voluntary pollution prevention programs 
built with competitive funds.
    While competitively-funded projects offer certain levels of 
accountability, they cannot provide policy makers with complete and 
detailed information to make spending decisions. Whether the decision 
involves competitively-funded projects or base funding for programs, 
there must be a more fundamental analysis that tests programs and 
projects by the same benchmarks of efficiency, effectiveness and 
accountability.
    In fact, Congress recognized the fundamental importance of this 
analysis when it enacted the Government Performance and Results Act 
(GPRA) of 1993, Public Law 103-62. GPRA provides a structure for 
measuring efficiency, effectiveness, and accountability in federal 
spending by directing CSREES and other agencies to develop and use 
performance-based planning, reporting, and budgeting. This structure 
improves program delivery by fundamentally shifting the focus of 
federal management from inputs, such as staffing and activity levels, 
to the outputs and outcomes of federal programs.
    Most importantly for this discussion, GPRA provides Congress with a 
basis for making spending decisions whether they involve programs or 
projects. A September 1998 Report to Congress ``Unlocking Our Future 
Toward a New National Science Policy submitted by the House Committee 
on Science (www.house.gov/science/science--policy--report.htm) 
indicates that GPRA can be applied to insure accountability of 
federally-funded research, including investigator-driven grant 
projects. By applying the same tests to funding questions involving 
projects and programs, Congress can establish a basis of comparison to 
evaluate its spending options.
    When the GPRA yardstick is used to measure a program such a 
Farm*A*Syst/Home*A*Syst, the results show that the program is an 
outstanding example of how Land Grant Universities and CSREES are 
providing high quality and effective programming to address issues of 
national importance. The following section documents Farm*A*Syst/
Home*A*Syst's performance in regard to the CSREES 1997-2002 Strategic 
Plan (www.reeusda.gov/part/gpra/stratpl.htm) developed in accordance 
with GPRA requirements.
         farm*a*syst/home*a*syst performs under gpra standards
    Farm*A*Syst/Home*A*Syst fulfills these key elements of the CSREES 
Strategic Plan, including 4 of the 5 goals which form the core of 
agency procedural and program strategies:
    1. Farm*A*Syst/Home*A*Syst provides strong leadership in voluntary 
pollution prevention to address national water quality priorities; 
fosters collaboration through a network of state delivery teams that 
emphasize interagency and private sector partnerships; and increases 
access to, transfer of, and dissemination of education and research-
based information targeted to customer needs.
    2. Farm*A*Syst/Home*A*Syst increases harmony between agriculture 
and the environment by:
    a. nationwide program implementation involving locally-modified 
materials and innovative delivery approaches that increase awareness. 
knowledge and use of voluntary actions among:
  --livestock producers to reduce pollution risks from animal waste.
  --agricultural producers to improve cropland practices including 
        nutrient management.
  --agricultural producers to protect ground and surface water used for 
        drinking and other functions.
  --forest managers to ensure water quality, ecosystems integrity and 
        biodiversity.
    b. improving the quality of information about agricultural 
pollution risks, thereby enhancing the decision-making on public 
policies related to agriculture and the environment.
    3. Farm*A*Syst/Home*A*Syst improves food safety by increasing 
agricultural producer awareness, knowledge and use of voluntary actions 
to control or eliminate food-borne risks (e.g. microbial and pesticide) 
through integrated pest management, the control of pesticide 
application, water quality protection measures, and animal waste 
management.
    4. Farm*A*Syst/Home*A*Syst promotes health by increasing individual 
awareness, knowledge and use of voluntary actions to reduce health 
risks related to drinking water from private wells, indoor air quality, 
exposure to lead, and hazardous products management.
    5. Farm*A*Syst/Home*A*Syst increases the capacity of communities, 
families, and individuals to improve their own quality of life by 
helping:
  --communities protect public drinking water supplies through tools to 
        manage farm and residential pollution.
  --limited resource and other under-served audiences reduce pollution 
        risks with simplified materials for use in homes and on farms.
  --government programs such food and nutrition efforts provide 
        additional benefits through education that helps participants 
        protect their health and the environment.
    This high level of performance results from contributions of a 
network of 50 state Farm*A*Syst/Home*A*Syst programs and a national 
office that coordinates this network. Organized according to the five 
categories listed above, the following represent highlights of these 
contributions.
       1. strong model of effective programming and partnerships
    In this recent statement, Colien Hefferan, Acting Administrator, 
CSREES, captures the program contributions in this area:
    ``The Farm*A*Syst/Home*A*Syst program is an cutting-edge example of 
effective programming--translating technical research information into 
easily understood, hands-on education that empowers private citizens to 
take actions that prevent pollution.
    ``Its proven ability to foster partnerships among local, state and 
federal agencies and the private sector presents a strong model for 
future Extension programs.''
  2a. tool that supports voluntary action to improve animal waste and 
                          nutrient management
    Wisconsin and California have developed model materials for land 
application of manure and other aspects of nutrient management that 
have been shared with many state Farm*A*Syst/Home*A*Syst programs.
    A pilot study of the Nebraska livestock systems worksheet had these 
results: 45 of 95 livestock producers (averaging 1346 swine, 1218 beef 
cattle and 238 dairy cattle) made or anticipate making improvements in 
manure removal from pens and lagoons, manure use (e.g. incorporation, 
soil sampling, manure testing), odor control. equipment and facilities. 
These producers will voluntarily invest between $2,100-8,400 to make 
these improvements.
    In California, an EQIP-funded project the Environmental Stewardship 
Short Course has incorporated Farm*A*Syst to improve education of dairy 
producers. Delivered to 900 dairy producers in 19 locations, the course 
uses Farm*A*Syst worksheets on livestock lots, manure storage and 
nutrient management to identify compliance issues. Over 90 percent of 
the participants would recommend the course to other producers and plan 
to make management changes.
    In Pennsylvania, an eco-labeling program, The Environmental Quality 
Initiative, uses Farm*A*Syst in a market-based approach to reducing 
pollution from dairy operations. Farm*A*Syst is the tool to measure 
environmental performance of the voluntary participants. Those who pass 
the test are rewarded with a premium from milk sales through Fresh 
Fields.
    A Wisconsin project with the Milk & Dairy Beef Quality Assurance 
Center will modify Farm*A*Syst for deliver by veterinarians. Using 
these materials, this project will educate dairy producers about the 
links between pollution and health risks.
    In states such as Missouri, Farm*A*Syst is recognized as an 
alternative to satisfy the industry-sponsored National Pork Producers 
Council's Environmental Quality Assurance Program.
    Arkansas is actively supporting EQIP with a web site ``Arkansas 
Farm*A*Syst An Environmental Quality Incentives Program (EQIP) Tool For 
Agriculture'' (www.uaex.edu/natural/eqip4/eqiphome.htm).
    New York's specialized worksheet on pathogens improves herd 
management to minimize pathogens among calves and reduces risks of 
pathogen contamination of water bodies.
    2b. tool that supports voluntary action to protect water quality
    Iowa Farm Bureau Federation is providing leadership to implement 
Farm*A*Syst to help producers understand environmental requirements, 
identify pollution risks that threaten water quality, and stimulate 
market-based incentives such as loan discounts and reduced insurance 
premiums for Farm*A*Syst users. (Rick Robinson. Why Iowa Farm*A*Syst, 
Iowa Farm*A*Syst Newsletter, Fall 1998).
    A Mississippi project known as Delta FARM (Farmers Advocating 
Resource Management) has made use of Farm*A*Syst materials to increase 
adoption of BMPs specifically tailored to the unique farming conditions 
in a region that runs from Memphis to Vicksburg.
    Illinois FarmASyst has developed a program that works with rural 
landowners living in recharge zones for community wells. By helping 
these individuals protect their private wells from pollution, the 
program minimizes the risk of contamination threats to public supplies.
    In Wisconsin's Buffalo and Grant Counties, EQIP-funded projects 
using Farm*A*Syst's computerized assessments can aggregate data from 
individual farm sites to develop watershed pollution profiles, and 
provide a reliable basis to target future spending and evaluate program 
impacts.
    The program's effectiveness in protecting water quality was 
documented in the Journal of Soil and Water Conservation 53(1), 4-10 
(1998) by ERS economist, Marc Ribaudo in his assessment of USDA 
agricultural nonpoint source programs:
    ``If a link between farming activities and personal health can be 
clearly demonstrated, evidence suggests that farmers are more likely to 
take action. A successful program for educating farmers about the 
relationship between their activities and personal health is 
Farm*A*Syst . . . It has been effective in getting individuals to take 
cost-effective, voluntary actions to remediate and prevent problems 
such as leaking fuel storage tanks, pesticide spills, and poor well 
maintenance.''
     3. tool that supports voluntary action to improve food safety
    In California, Georgia and Wisconsin, private sector organizations 
are supporting commodity-specific worksheets to promote responsible 
pesticide use among growers of wine grapes, cotton and potatoes.
    Several states such as Texas have model materials to improve 
pesticide use and support integrated pest management available on the 
web (e.g. waterhome.tamu.edu/texasyst/index.html).
    4. tool that supports voluntary action to promote family health
    States such as Kentucky and Illinois have modified Home*A*Syst to 
address health risks related to drinking water from private wells, 
indoor air quality, exposure to lead, and hazardous products 
management.
    Mississippi and New York are using Home*A*Syst to expand the health 
benefits of EFNEP, a food and nutrition program.
    Montana Home*A*Syst is working with the Low-Income Weatherization 
program to remove mercury from the home by replacing and recycling 
mercury thermostats.
    In Washington state Home*A*Syst is teaming with the Women, Infants 
and Children (WIC) program to educate at-risk individuals on how 
drinking water contamination impacts family health.
        5. tool that helps people improve their quality of life
    Arkansas and Montana Farm*A*Syst and Home*A*Syst are linked into 
state agency efforts to promote source water protection among 
communities.
    Missouri Farm*A*Syst is ready to support source water protection 
activities with a web site ``Missouri Farm*A*Syst: A Tool for Source 
Water Protection'' (www.wisc.edu/farmasyst/contact/mos/wp.html).
    North Dakota has extensively used Farm*A*Syst in education and 
outreach programs involving school children and vocational students.
    In Alaska, Home*A*Syst will be a key part of educational efforts to 
improve sanitation and protect water quality in traditional Alaskan 
villages.
                               conclusion
    It is vital to CSREES to provide base support to education and 
other CSREES programs of proven merit. These form the critical elements 
of an infrastructure that makes our Extension Service the envy of the 
world. Congress can apply GPRA standards to assess the efficiency, 
effectiveness and accountability of these programs, and make spending 
decisions that intelligently balance support for programs and projects. 
By way of example, applying GPRA standards to Farm*A*Syst/Home*A*Syst, 
it is clear that the program is enabling CSREES to achieve priorities 
and goals in its Strategic Plan.
    Furthermore, Farm*A*Syst/Home*A*Syst is enhancing the programmatic 
activities of NRCS and US EPA--the agencies that partner with CSREES to 
support Farm*A*Syst/Home*A*Syst. In terms of NRCS, the contributions to 
EQIP are evident in several of the examples provided above. Pearlie 
Reed, Chief, NRCS, also notes that ``Farm*A*Syst is an excellent tool 
for resource planning,'' adding that the program ``offers us 
opportunities for partnerships and encourages voluntary, locally-led 
conservation.'' EPA has recognized that Farm*A*Syst is a tool in 
promoting voluntary pollution prevention among AFO openers and 
operators. More generally. Farm*A*Syst/Home*A*Syst is making 
contributions to reduce nonpoint source pollution from agricultural 
activities outside livestock production and from residential sources 
such as septic systems. Farm*A*Syst/Home*A*Syst has demonstrated that 
it can be more than a tool to help protect private wells. As the 
program highlights suggest, it has shown promise as a tool to help 
protect public drinking water supplies. In the future, Farm*A*Syst/
Home*A*Syst can play an important role in addressing TMDLs, as 
highlighted by the Conservation Technology Information Center 
(www.ctic.purdue.edu/KYW/TMDLFact.html).
    In light of these significant contributions, it makes sense that 
funds not only be set aside in the CSREES budgets to support 
Farm*A*Syst/Home*A*Syst, but that funds also be identified in the 
budgets of EPA and NRCS to support the program.
                                 ______
                                 

    Prepared Statement of the Federation of American Societies for 
                      Experimental Biology (FASEB)

     Mr. Chairman, Mr. Kohl, Members of the Subcommittee: I am Dr. 
William Brinkley, Vice President for Graduate Sciences and Dean of the 
Graduate School of Biomedical Sciences at Baylor College of Medicine in 
Houston, Texas. I am a cell biologist who conducts research on cell 
division and genomic instability in tumor cells. This year I also serve 
as the President of the Federation of American Societies for 
Experimental Biology, FASEB. Founded in 1912, FASEB is the largest 
organization of life scientists in the United States with a combined 
membership of more than 56,000 researchers. Our members include 
scientists involved in a wide array of agricultural research including 
human and animal nutrition, plant science, animal physiology and 
reproduction. These scientists hold positions in virtually every land 
grant and private institution engaged in nutrition-related research in 
the United States, as well as in industrial and biotechnology 
enterprises conducting nutrition and food related research.
    FASEB maintains, as we believe this committee does, that research 
sponsored by the Department of Agriculture and conducted at 
universities throughout the United States generates vitally important 
new knowledge. These advances ensure an affordable, abundant and 
wholesome supply of food and fiber, as well as promoting the 
competitive position of U.S. agriculture in the global marketplace. As 
the world's population grows, societies everywhere are becoming more 
dependent on the productivity of U.S. farmers. Consequently, life 
sciences research is one of the keys to the improvements in agriculture 
which are required to feed and clothe the world, to reduce 
environmental pollution, to increase food safety and to improve 
nutrition.
    The USDA supports basic and applied research through its Research, 
Education, and Extension (REE) budget and through its intramural 
research arm, the Agricultural Research Service (ARS). Half of the 
total REE budget supports the Cooperative State Research, Education, 
and Extension Service (CSREES). CSREES targets its funding to national 
and regional priorities by using a variety of mechanisms to allocate 
resources, including ``base funding'' of mission-oriented research, 
education, and extension programs. Base-program funding maintains the 
cooperative partnership between the USDA and universities, sustaining 
the university-based agricultural research and education system as well 
as supporting the infrastructure necessary to address important 
national, state, and county issues.
    national research initiative competitive grants program (nricgp)
    The National Research Initiative Competitive Grants Program 
(NRICGP), a CSREES base program, funds competitive extramural research 
projects at public and private universities and colleges. Research 
proposals are reviewed for merit by panels of experts, and those 
attaining the best scores are funded. The NRICGP, the largest national 
competitive research grant program in the USDA, was authorized at $500 
million at its inception in 1990, but annual funding has never exceeded 
$119 million. FASEB's recommendations for the USDA focus principally on 
the NRICGP. Some examples of the program's recent accomplishments are:
  --Basic studies in the genetics, growth, and development of plants 
        have enabled scientists to develop transgenic plants containing 
        agronomically important genes. These procedures facilitate the 
        improvement of disease resistance, productivity, and 
        nutritional quality.
  --Human nutritionists have developed improved techniques for 
        evaluating the absorption and metabolism of nutrients, and for 
        assessing the nutritional status of human beings. Researchers 
        using such techniques yielded evidence that the requirements of 
        calcium and folic acid were substantially higher than 
        previously believed, which has led to the development of new 
        dietary recommendations for these essential nutrients.
  --Research funded by the NRI Food Safety program has led to a greater 
        understanding of the food processing and storage procedures 
        needed to reduce the risk of food-borne illness from bacteria 
        such as Salmonella and E. coli. Such research also has led to 
        the development of rapid genetic and immunological methods for 
        detecting such microorganisms.
    The competitive and highly productive merit-reviewed research 
program of the NRICGP is vital to the future of U.S. agriculture, yet 
its share of the USDA budget is hardly commensurate with the importance 
of its mission. Indeed, only 5.4 percent of the USDA's $1.8 billion 
research budget is devoted to nationally competitive grants. Congress 
recognized the value of the research being conducted by the NRICGP, and 
increased its funding in fiscal year 1998 and again in fiscal year 
1999. FASEB applauds Congress for these actions, given that they 
represent an important change from the fiscal year 1994 through fiscal 
year 1997 period when funding for the NRICGP was decreased.
    Yet, even with these additional resources, critical agricultural 
research is still underfunded. Currently, only 25 percent of qualified 
grants receive funding. Inadequate support limits the productivity of 
researchers that the NRICGP is able to fund. NRICGP awards are small, 
averaging $133,210 in fiscal year 1998, and short, averaging 2.2 years 
(i.e., a total support of about $60,000 per year). Researchers are 
forced to limit the scope of their work or spend valuable time writing 
additional grant proposals.
    FASEB believes that research support for areas such as animal, 
plant and microbial genomics; human nutrition; food safety; plant 
biochemistry; environmental impact of animal pollutants; integrated 
agricultural systems; and infrastructure should be augmented. The funds 
now available for these areas of critical research are insufficient to 
enable them to reach their full potential. FASEB makes the following 
recommendations.
  --In 1990, Congress established the NRICGP with the goal that it be 
        incrementally increased to $500 million within 5 years. The 
        increase in fiscal year 1999 brought NRICGP funding to only 
        $119.3 million, well below the originally intended level for 
        this critical program. FASEB recommends that the base funding 
        for the NRICGP be increased to the level recommended in the 
        president's fiscal year 2000 budget, $200 million.
  --To provide the foundation for the technology-intensive agriculture 
        of the 21st century, FASEB reaffirms its support for NRICGP 
        funding reaching the originally authorized $500 million goal as 
        soon as budgetary resources can be found for this investment.
  --NRI grants provide a vital funding opportunity for first-time 
        investigators. FASEB supports the ongoing NRI process for 
        enhancing the funding of new investigators, and encourages the 
        NRI to expand the number of these awards.
  --FASEB recommends that efforts be made within NRI to fund grants at 
        levels and for periods sufficient to achieve their peer-
        reviewed, recommended aims.
  --FASEB endorses the policy of using funds from the NRI program to 
        nominate and fund young investigators for the President's Early 
        Career Award for Scientists and Engineers.
  --FASEB commends and supports the USDA and NRI for their successful 
        collaboration with other federal agencies on issues such as the 
        Plant Genome Project and the Food Safety Institute. These 
        relationships reduce duplication, allow for rapid response to 
        emerging opportunities and crises, and assure the public that 
        tax dollars are being spent wisely.
  --FASEB urges Congress to reexamine the 14 percent cap on indirect 
        (facilities and administrative) costs for NRI grants.
                education--the national needs initiative
    The National Needs Initiative (NNI), the Graduate Fellowship 
Program of the Higher Education Office, and several other USDA programs 
contribute to the training mission of the USDA. Despite its importance, 
funding for the NNI has seen a dramatic decline in recent years. In 
fiscal year 1996, the NNI budget was $5 million; this amount was 
decreased $1 million in each of the following two years. The program 
received $3 million in fiscal year 1999, the same as the previous year.
  --FASEB specifically recommends that NNI funding be restored to its 
        previous level of $5 million in fiscal year 2000 because of the 
        critical need to train the next generation of agricultural 
        researchers.
  --To insure the optimal development of the future supply of 
        agricultural researchers, FASEB continues to call for a review 
        and subsequent reorganization of USDA-sponsored graduate 
        training.
           initiative for future agriculture and food systems
    Last year, Congress authorized the Initiative for Future 
Agriculture and Food Systems, a new mandatory spending program that 
would fund competitively awarded research grants at the USDA to support 
large, multidisciplinary, multicenter programs beyond the scope of the 
NRI. Financial resources for this initiative were to be drawn from a 
provision that reduced federal spending for Food Stamp Program 
administration by $600 million over five years. Unfortunately, due to 
financial constraints on the Congress last fall no funds were 
appropriated in fiscal year 1999.
    Had funds been made available, priority mission areas to be 
addressed in the first year would have been (1) the food genome; (2) 
food safety, food technology and human nutrition; (3) new and 
alternative uses and production of agricultural commodities and 
products; (4) agricultural biotechnology; and (5) natural resource 
management. The initiative also includes provisions for merit/peer-
review and for input into the priority-setting process from those who 
benefit from agricultural research.
  --FASEB strongly endorses the Initiative for Future Agriculture and 
        Food Systems and recommends that full funding authorized under 
        current law be provided in fiscal year 2000.
                       use of animals in research
    Research using animals has been crucial to most of the major 
medical advances of the past century. Reasonable guidelines concerning 
how animals are used in research provide safeguards and ensure public 
confidence. One area of particular concern has been the supply of dogs 
and cats that were not specifically bred for research. The USDA's 
Animal and Plant Health Inspection Service (APHIS) is charged by 
Congress with enforcing provisions of the Animal Welfare Act (AWA) 
standard to ensure that these ``random source'' dogs and cats needed 
for research can be acquired by licensed dealers through legitimate 
channels. FASEB commends the USDA for its diligent enforcement efforts, 
including ``trace backs'' of the ownership records that dealers are 
required to keep. In recent years USDA has issued steep fines against 
dealers whose records were incomplete or false, and putting out of 
business several who were guilty of serious violations.
    FASEB recommends that Congress provide the Animal and Plant Health 
Inspection Service with adequate funding for enforcement of the Animal 
Welfare Act in fiscal year 2000, so as to ensure compliance with this 
law.
                  facilities for agricultural research
    A hallmark of American success in agricultural research has been 
the central role of land-grant universities. Federal funds for 
construction of agricultural research facilities at land-grant 
universities, however, have been severely curtailed. The growth of 
facilities at these institutions has not matched the explosion of the 
biotechnology research that has occurred in the late 1990's. The 1996 
Farm Bill wisely required the development of a long-range plan for all 
federally supported facilities and this planning requirement should be 
extended to university-based agricultural research facilities.
  --FASEB supports a long-range plan for renewing agricultural research 
        facilities at land-grant universities, which will parallel 
        research needs and funding opportunities. This plan should 
        include a merit-review process.
    Mr. Chairman, these are FASEB's recommendations as you and the 
Committee begin the task of deciding how best to increase the base 
funding for the 26 research programs of the NRICGP. We have also made 
other policy recommendations in our FASEB Report on Federal Funding for 
Biomedical and Related Life Sciences Research for fiscal year 2000, 
distributed earlier to members of this subcommittee, and we hope you 
will review this report carefully.
    In conclusion, Mr. Chairman, we believe this is an opportunity to 
expand our country's historic effort to improve America's health and 
productivity through agricultural research.
                                 ______
                                 
             Prepared Statement of Florida State University
    Mr. Chairman, thank you and the Members of the Subcommittee for 
this opportunity to present testimony. I would like to take a moment to 
acquaint you with Florida State University. Located in the state 
capitol of Tallahassee, we have been a university since 1950; prior to 
that, we had a long and proud history as a seminary, a college, and a 
women's college. While widely known for our athletics teams, we have a 
rapidly emerging reputation as one of the Nation's top public 
universities. Having been designated as a Carnegie Research I 
University several years ago, Florida State University currently 
exceeds $100 million per year in research expenditures. With no 
agricultural or medical school, few institutions can boast of that kind 
of success. We are strong in both the sciences and the arts. We have 
high quality students; we rank in the top 25 among U.S. colleges and 
universities in attracting National Merit Scholars. Our scientists and 
engineers do excellent research, and they work closely with industry to 
commercialize those results. Florida State ranks fourth this year among 
all U.S. universities in royalties collected from its patents and 
licenses, and first among individual public universities. In short, 
Florida State University is an exciting and rapidly changing 
institution.
    Mr. Chairman, let me describe three projects that FSU is pursuing 
this year. The first is a major collaborative effort which draws upon 
the expertise of three outstanding Florida universities. Focusing on 
climate variability in the State of Florida and the Southeast (SE), the 
objectives include exploring the value of climate data based on the El 
Nino-Southern Oscillation (ENSO) and developing practical applications 
for climate forecasts, particularly for agriculture.
    This consortium draws upon the expertise of scientists at FSU, who 
have the technical capability to deliver detailed climate variability 
knowledge; the University of Florida, who possess technical expertise 
in agricultural engineering, modeling, agricultural decision support 
and information delivery; and the University of Miami, who have 
expertise in implementing the knowledge into the agricultural 
community.
    Abundant evidence illustrates the economic importance to farmers of 
early climate forecasts of extreme weather events. The unanticipated 
January 1997 freeze that cost the winter vegetable industry in South 
Florida more than $200 million is just one reminder. Storms, drought 
and flooding associated with the unusually strong El Nino event of 
1982-83 that cost thousands of lives and an estimated $13 million in 
crops globally is another reminder.
    ENSO-based forecasts can now provide useful weather information in 
many regions at the required lead times. Short- and long-term forecasts 
could provide the agricultural industry with a range of opportunities 
for mitigating adverse impacts of bad weather, as well as taking 
advantage of favorable weather.
    During the initial phase of this effort, the FSU team described 
qualitatively the impact of El Nino (and the other extreme, La Nina) on 
temperature and precipitation patterns across the SE. Additionally, the 
team found a geographic shift in tornadic activity associated with El 
Nino events. A new climate forecast system to provide predictions of 
seasonal temperatures and precipitation with longer lead times and 
improved skill now is in the testing phase. Improvements are due in 
part to the coupled nature (i.e., the linking of the ocean and 
atmosphere so they respond to each other dynamically) of the forecast 
system.
    Our colleagues at the University of Florida identified several 
crops in Florida that are vulnerable to shifts in weather patterns 
associated with El Nino and La Nina, and further noted that the impact 
is not uniform in nature across the state.
    Continuing this collaboration, the consortium hopes to estimate the 
economic advantages of incorporating information from climate forecasts 
into farming management systems, and to eventually work with sector 
representatives in developing guidance products for the agricultural 
community.
    The National Oceanic and Atmospheric Administration provided the 
initial funding for this project. We are seeking $2.5 million to 
continue this worthwhile effort in fiscal year 2000.
    Our next two projects involve marine aquaculture efforts. The 
opportunity for the U.S. aquaculture industry to meet the increasing 
demand for seafood has never been greater than it is today. The 
majority of the world's marine aquaculture production takes place in 
coastal ponds or sea cages. U.S. aquaculture industry development has 
been inhibited by the high cost and limited availability of coastal 
lands, high production costs, restricted growing season and 
governmental regulations. In order for U.S. marine aquaculture 
production to expand and develop, innovative approaches to address the 
constraints being faced by the emerging aquaculture industry must be 
found.
    Florida State University (FSU) and Harbor Branch Oceanographic 
Institution (HBOI) have formed a collaboration to design and develop 
engineered, intensive recirculating culture systems for marine species 
in new environments. Expanding marine aquaculture opportunities to 
inland sites through species that can be adapted to fresh water, 
designing low-cost, recirculating production systems, and the 
development of energy efficient (i.e., solar) production systems 
provide solutions to several of the production and regulatory 
constraints faced by U.S. producers. If progress is made in these 
areas, aquaculture offers a new business opportunity for economically 
disadvantaged communities.
    There is an increasing global awareness of the need for sustainable 
aquaculture development. By the year 2025 global population is 
projected to be nearly 8.5 billion people, with a projected demand for 
seafood of 120 million metric tons (MMT). Seafood fisheries reached 
carrying capacity ten years ago with a capture of 60 MMT but demand for 
seafood has shown no signs of abating. The Food and Agriculture 
Organization (FAO) reported that by 1995, aquaculture only accounted 
for 26 percent of the total world harvest of food fish. In 1997, U.S. 
seafood imports increased both in volume and value with shrimp topping 
the list at 278,600 metric tons valued at $2.7 billion dollars. Shrimp 
imports continue to be the second largest contributor to the U.S. trade 
deficit and it is expected that finfish imports will follow the same 
scenario. There remains a great need for U.S. aquaculture production to 
fill this void and relieve some of the harvest pressure on natural 
stocks.
    Competition for access to the now limited U.S. coastal land 
resources requires innovative approaches to develop and expand marine 
aquaculture into new environments. HBOI has work underway that suggests 
many saltwater species thrive in freshwater systems with the 
appropriate chemical makeup. Another issue is environmental protection 
of coastal waters and biosecurity to protect both wild and farmed 
aquatic resources from disease and exotic introductions, which 
necessitates the development of cost-effective recirculating production 
systems. In many locations around the U.S., regulatory constraints 
already require the use recirculating aquaculture systems. HBOI has 
designed an intensive recirculating, production system to culture 
marine finfish species in fresh or brackish water. FSU's Department of 
Oceanography and the FSU/FAMU College of Engineering are teaming with 
HBOI to conduct parallel experiments to determine the optimal 
production parameters using hard freshwater in Florida. FSU's research 
on solar technologies will be utilized to design more energy efficient 
systems for this effort as well. All of this work will expand U.S. 
aquaculture production of saltwater species into new locals, result in 
better utilization of land resources and reduce the demand for imported 
aquaculture products.
    The two collaborating institutions are seeking $1.2 million in 
fiscal year 2000 from the U.S. Department of Agriculture to initiate 
this project.
    Our second aquaculture effort involves sustaining aquaculture 
opportunities through distance learning. To meet the needs of the 
growing aquaculture industry in Florida and across the Nation, Florida 
State University (FSU) is partnering with Harbor Branch Oceanographic 
Institution (HBOI) to develop materials that would be employed in an 
outreach training program in the field of aquaculture though the use of 
distance learning technologies.
    Aquaculture may provide the opportunity for the U.S. aquaculture 
industry to expand and meet the increasing demand for seafood. 
Worldwide commercial harvest of fish and shellfish has remained 
essentially unchanged from 100 million metric tons since 1989. Nearly 
70 percent of conventional commercial species are now fully exploited 
or over exploited. Yet U.S. marine aquaculture development has lagged 
behind overseas competition.
    In 1997, HBOI initiated a short and long-term training program 
related to aquaculture. Working with faculty at FSU, new technological 
capacities will allow these two groups--separated by several hundred 
miles--to rely on distant learning technology to facilitate 
communication between research staff and faculty, and provide increased 
aquaculture instructional opportunities for students.
    With this technology in place and materials related to aquaculture, 
its opportunities, and its challenges being developed, the two 
institutions will build upon a successful program established nearly a 
decade ago through HBOI's successful implementation of community-based 
training programs in clam and oyster aquaculture. The programs spanned 
from 1989 to 1998 and focused on training fishermen and women in 
shellfish farming, thereby allowing them to maintain their way of life 
on the water. The number of clam farmers has grown from a handful in 
the mid-1980s to nearly 600 today. A number of other aquaculture 
business opportunities exist for rural communities throughout Florida, 
but their implementation requires that the training and technical 
support be provided in the home community. Through a combination of 
distance learning technology and satellite education and support hubs, 
we propose to provide aquaculture training, technical support, and 
appropriate economic information to rural communities throughout 
Florida. As materials are being developed in the first phase of this 
project, the collaborators will work with such groups as the Panhandle 
Library Access Network, a collection of 47 libraries in 13 rural 
Florida Panhandle counties, agricultural extension agents, and local 
economic development officials to develop a comprehensive dissemination 
network for this information.
    FSU and HBOI are requesting $470,000 for this initial phase of this 
work in fiscal year 2000 from the U.S. Department of Agriculture.
    Mr. Chairman, these are just a few of the exciting activities going 
on at Florida State University that will make important contributions 
to solving some key problems and concerns our Nation faces today. Your 
support would be appreciated, and, again, thank you for an opportunity 
to present these views for your consideration.
                                 ______
                                 
 Prepared Statement of the Friends of Agricultural Research--Beltsville
    Mr. Chairman, and Members of the Subcommittee, thank you for the 
opportunity to present this statement in support of funding for 
agricultural research. We are requesting your support for programs of 
the Agricultural Research Service (ARS) and its world renowned 
Beltsville Agricultural Research Center in Maryland.
    The Friends of Agricultural Research--Beltsville (FAR-B) is a 
private non-profit organization dedicated to supporting and promoting 
excellence in agricultural research, especially the ARS research 
programs at Beltsville. FAR-B provides supplementary private funds for 
both research and education. The Friends co-sponsor symposia, 
conferences, and workshops on topics of current scientific interest. 
Financial assistance is provided for Beltsville scientists to spend 
time at other research centers here and abroad to update their 
technical skills. Funds are provided to co-host international 
scientists who visit Beltsville each year to discuss cooperative 
programs and exchange scientific information. This public/private 
partnership promotes excellence, helps to ensure that useful new BARC 
technology is put into practice, and is supportive of the mission and 
goals of the Agency.
    The productivity of American agriculture is the envy of the world. 
The outstanding performance of U.S. agriculture and the unprecedented 
gains in productivity during this century can be attributed in large 
measure to the dynamic research and development system in this nation. 
Scientists and engineers contribute a continuing stream of new 
knowledge, technological innovations, and new products to sustain the 
U.S. agricultural enterprise. Public investments in agricultural 
research have been critical to the success of U.S. agriculture. In 
return, the public has reaped substantial benefits. Studies show that 
every tax dollar invested has paid back at least $1.35. These returns 
have been broadly shared through lower prices for American consumers, 
increased international competitiveness for farmers, jobs for working 
families, and increased profitability in agricultural industries. Funds 
for research are sound investments.
    The U.S. Department of Agriculture (USDA) is a major player in 
basic and applied research to solve problems and to keep America's food 
and fiber system competitive in the global marketplace. The 
Agricultural Research Service is the principal in-house research Agency 
of USDA. It has a lead role in solving high-priority problems of broad 
national significance. The Beltsville Agricultural Research Center is 
the flagship research facility of ARS.
                               beltsville
    The Beltsville Agricultural Research Center (BARC) is a 
comprehensive research complex consisting of 47 laboratories and a 
staff of 1,500 scientists, engineers, technicians, and other support 
personnel. Research programs range from conservation of soil and water 
resources to human nutrition. Beltsville scientists do basic and 
applied research in plant and animal genetics, physiology, and 
chemistry, as well as a wide range of projects in other areas, 
including new instrumentation, germplasm databases, and computer 
modeling of complete production systems.
    In recent years, the research program at BARC has expanded to 
encompass biotechnology, genome mapping, and fundamental research on 
biological control of plant and animal diseases,insects, nematodes, and 
weeds. Major emphasis is focused on environmental issues, food safety 
and health, and sustainable agriculture.
    Beltsville's record of accomplishments and ongoing programs have 
made it a world leader in agricultural research. Its international 
reputation attracts thousands of visitors each year from the United 
States and abroad. The world renowned National Agricultural Library--
the largest agricultural library in the world and the Nation's chief 
resource of agricultural information--is also located on the BARC 
campus.
                        priority research issues
    A number of important issues confront American agriculture and are 
of deep concern to the public. Central among them are the quality of 
the environment and the nutritional quality and safety of our food. The 
fiscal year 2000 Budget for ARS proposes new funds and increased 
initiatives to address these vital challenges. Beltsville scientists 
are currently engaged in research in these critical areas and will 
expand their efforts if the proposed budget thrusts are funded.
    Biologically-Based Integrated Pest Management.--The reliance on 
chemical-based pesticides, the increasing occurrence of pesticide 
resistance, particularly in insect pests, and the threat of 
agricultural chemicals for polluting the environment have presented an 
important challenge to the agricultural community. ARS has risen to 
this challenge by increasing its research to develop a broad array of 
strategies for use in integrated pest management (IPM), i.e., a system 
that relies on a variety of control techniques as alternatives to total 
dependency on chemical pesticides in order to reduce health risks, 
sustain natural resources, protect the fragile ecosystem, and at the 
same time maintain a viable agricultural enterprise. The goal of USDA 
is to have IPM in practice on 75 percent of U.S. agricultural acres by 
the year 2000.
    The search for new and more effective ways to implement IPM 
programs has led to greater emphasis on biological control. There is 
great potential for research and development in this area. Knowledge of 
the basic biology of insects, viruses, bacteria, fungi, nematodes, and 
weeds is essential for identifying, developing, and using biological 
control agents successfully.
    Beltsville scientists have pioneered in fundamental and applied 
research on both the chemical and biological processes associated with 
the behavior and development of insects. They have been in the 
forefront of basic studies of pheromones, attractants, repellents, 
deterrents, and growth regulators derived from insect, plant or 
synthetic origin. Such research has led to practical new techniques for 
the control of a variety of insect pests such as the Mediterranean 
fruit fly, gypsy moth, Japanese beetle, corn earworm, and many other 
pests of economic importance.
    The fiscal year 2000 budget proposes increased funding for 
Beltsville to develop attractants for invasive pest species, such as 
the Asian long horned beetle, a potential new and devastating threat to 
forests and urban trees nationwide. New research is needed to develop 
attractants and traps necessary to detect and monitor populations so 
that appropriate remedial action can be taken. This Beltsville research 
program is currently significantly underfunded to carry out this work 
and is at risk of losing its critical mass of scientific expertise in 
this important mission area. This is a top priority funding need.
    National Nutrient Database.--Many studies have implicated dietary 
factors in the cause and prevention of important diseases, including 
cancer, coronary heart disease, diabetes mellitus, birth defects, and 
cataracts. For diseases linked strongly to diet, the cost of medical 
treatment and care is estimated to exceed $200 billion a year. Clearly, 
this is an important issue for those in human nutrition research; the 
ARS human nutrition research program seeks to address this public 
concern.
    An important and essential component of the ARS human nutrition 
program is the National Nutrient Database maintained by the Beltsville 
Human Nutrition Research Center. This database of foods consumed in 
this country is the foundation for food consumption tables throughout 
the world. In spite of its position as the preeminent nutrient 
database, many food items are not included due to rapid changes that 
have taken place in food production, processing, and preparation in 
recent years. Some data are as much as 30 years out of date. There is a 
critical need to update data to ensure that nutrition research is based 
on a solid understanding of the nutrient content of foods and that 
information provided to producers, the food industry, and consumers is 
accurate and reliable. The ARS budget proposes $2.2 million for 
Beltsville to update this mission-critical resource.
    Food Composition Methods.--The value of the National Nutrient 
Database depends upon the accuracy and reliability of methods used to 
develop the data. The Food Composition Laboratory at Beltsville has a 
staff which develops and refines methods that will allow chemists to 
measure the nutrients and contaminants among thousands of compounds in 
foods. Scientists have found that many analytical methods for specific 
components are lacking or inaccurate. Either existing technology or new 
techniques must be developed for the unique requirements of the complex 
biological samples that need to be evaluated. For example, a food 
compound can have many forms. Some are more biologically active than 
others. Chemists take food apart--molecule by molecule. To develop a 
definitive method, it is important to know how the body uses different 
forms of the compound. Researchers are especially interested in the 
active plant compounds--or phytonutrients--that are associated with 
lower incidence of cancer and cardiovascular disease in populations 
that eat plenty of fruits, vegetables, and other food plants. 
Scientists at the Beltsville Human Nutrition Research Center have been 
collaborating with colleagues at the National Cancer Institute and the 
National Heart, Lung, and Blood Institute since the 1970's to develop 
better analytical methods and to more completely understand the 
relationships between the composition of foods and the biological 
effects from a nutrition perspective. Sound dietary decisions depend 
upon good analytical methods.
    The fiscal year 2000 budget for ARS proposes an increase of $1.2 
million to develop sophisticated and reliable analytical methods that 
will be needed to determine the concentration of nutrients in foods, 
with particular emphasis on nutrients that are being newly discovered 
in fruits, vegetables, and other food plants. This is an important 
priority.
    Risk Assessment/Agricultural Waste.--The public is very concerned 
about the risks associated with agricultural wastes that enter into the 
water supply. Livestock manure and fertilizers are excellent sources of 
essential plant nutrients. However, excessive application or poor 
management practices can contribute to the contamination of streams, 
ponds, and ground water. ARS is increasing its research to better 
understand the relationships between agricultural practices and water 
quality. A major portion of the research on animal waste and nutrient 
management is at Beltsville, where the emphasis is on an integrated 
approach to crop and animal production systems.
    The budget proposes an increase in funding at BARC to develop 
predictive models for assessing the risk of transmission of zoonotic 
parasites through farm management systems, animal wastes, and water 
runoff. This will strengthen research on pathogen transmission as a 
part of the ongoing animal waste/management program. The emphasis is on 
the Cryptosporidium parvum, a single celled parasite excreted in animal 
wastes that can contaminate water supplies. Healthy individuals 
infected with this parasite may suffer symptoms of diarrhea, 
dehydration, abdominal pain, nausea, and fatigue. A person whose immune 
system is compromised can also suffer damage to the liver, pancreas, or 
lungs. BARC is a major center of excellence on cryptosporidium 
research. Studies will focus on the life cycle of this parasite, its 
impact on humans, and methods for combating and reducing the risk of 
transmission. We hope that the Committee will see fit to support 
increased funding for this program.
                      modernization of facilities
    A recent General Accounting Office report found widespread problems 
with aging Federal facilities around the country and recommended a 
massive overhaul of these facilities, especially of those built over 50 
years ago. With the support of this Committee, modernization of the 
facilities at Beltsville began in 1988. Significant progress has been 
made in upgrading and modernizing the facilities, equipment and 
infrastructure at BARC. We are grateful for this support. This has been 
critical to keeping research at Beltsville in the forefront of science 
and competitive with other international research centers.
    The current highest priority in the modernization plan is to 
upgrade the facilities for the Beltsville Human Nutrition Research 
Center (BHNRC). The Department proposes in the fiscal year 2000 Budget 
funding for the construction of a new facility for human nutrition 
research at Beltsville. Current facilities are among the oldest in USDA 
and are, thus, in the greatest need of overhaul or replacement. This 
Committee provided in fiscal year 1997 $1.7 million for planning and 
design of new BHNRC facilities. The design is now underway. Funding is 
now needed to complete the construction in a timely and efficient 
manner. Costs to fully fund the new facility are estimated at $22 
million. BHNRC scientists have made many significant contributions to 
Federal nutrition programs, including uninterrupted input over the past 
30 years to the establishment of the Federal government's Recommended 
Daily Allowance (RDA) for dietary intake by the U.S. population. 
Modernization of these research facilities will promote continued 
scientific excellence well into the next century.
    Mr. Chairman, FAR-B thanks you and the Committee for your interest, 
leadership, and generous support of ARS and the Beltsville Agricultural 
Research Center. We recognize that finding funds for Federal 
agricultural research programs and facilities is a difficult challenge 
no matter how important the work is to the health, safety, prosperity, 
and well being of the Nation. This Committee has met the challenge over 
the years, and we encourage your continued efforts. We look forward to 
working with you in any way you may desire to serve the interests of 
American agriculture.
                                 ______
                                 
        Prepared Statement of Friends of the National Arboretum
    Mr. Chairman and Members of the Subcommittee, I am grateful for 
this opportunity to present testimony on behalf of Friends of the U.S. 
National Arboretum (FONA), in support of FONA's fiscal year 2000 
request for $500,000 for engineering and design to implement the new 
Master Plan and $500,000 for information technology support to expand 
the National Arboretum's internet service.
    Thanks to your Committee, and after some years of preparation, your 
U.S. National Arboretum is poised to move into the 21st Century and 
enhance its mission of horticultural education mandated by Congress. 
With the private support and encouragement of FONA, the Agricultural 
Research Service (ARS) has contracted for a new Master Plan to 
modernize the National Arboretum and make it a more viable and 
significant educational resource and attraction. Because the new Master 
Plan commissioned by the ARS is scheduled to be completed before fiscal 
year 2000, FONA is requesting design funds in the amount of $500,000 so 
work on modernizing the U.S. National Arboretum will not be delayed yet 
another year. The new Master Plan was not sufficiently developed in 
time to enable these funds to be included in the President's budget.
    The new Master Plan is being prepared under the leadership of 
Geoffrey L. Rausch, of Environmental Planning & Design (EDP), an 
internationally acclaimed designer of arboreta and botanic gardens. The 
Plan envisions four major conceptual developments at the U.S. National 
Arboretum to enhance the Arboretum's singular role as a source of 
horticultural education and as a national showcase of advances in 
horticulture. All four concepts have the strong support of FONA.
    First, the new Master Plan envisions a new entrance to the National 
Arboretum off Bladensburg Road. The most used current entrance is 
through a residential neighborhood on R Street. For a number of years 
the National Arboretum has sought to improve the New York Avenue 
entrance but this has been rejected by District of Columbia authorities 
because of the traffic volume on New York Avenue. The recommended 
entrance off Bladensburg Road is a superior solution.
    Second, the new Master Plan envisions a walkable central core to 
the National Arboretum which would contain enhanced garden displays and 
offer the educational opportunity of interactive video explaining the 
meaning and significance of the displays. This core concept is critical 
to making the National Arboretum more attractive to visitors in order 
to stimulate interest and education in horticulture. Gardening is the 
nation's favorite hobby and horticulture the fastest growing segment of 
the agricultural industry.
    Third, the new Master Plan envisions a new visitors center adjacent 
to the walkable core which would provide orientation, exhibit space and 
offer the potential of electronic classrooms for horticultural 
education similar to the classrooms at the National Museum of Natural 
History. This is also critical to enhancing the education mission of 
the U.S. National Arboretum.
    Fourth, the new Master Plan envisions tram service to provide 
further orientation and service to collections beyond the central core. 
This would improve educational opportunities and alleviate traffic 
congestion at peak visitation periods.
    In further development of the new Master Plan, engineering and 
design for the Grounds/Site Work requires long lead time. As detailed 
on Exhibit 1, this engineering and design is estimated to cost 
$500,000. The figures on Exhibit 1 were prepared by the National 
Arboretum in conjunction with EDP at the request of FONA.
    It is significant that the new Master Plan contains a number of 
projects such as the new entrance, the visitors center and new 
collections in the core which are candidates for private financing. 
FONA intends to include these projects in a capital campaign if 
approved.
    With the private support of FONA, the National Arboretum has also 
developed a website and a home page displaying horticultural 
information on the internet. This internet site has shown a dramatic 
increase in national and international use in the first year and one 
half of operation. Of the $500,000 requested for information 
technology, $250,000 would be devoted to the National Arboretum's 
horticultural library including a full-time professional librarian to 
help support the data being added to and made available on the National 
Arboretum's home page. The remaining $250,000 would be devoted to 
support a full-time Web Master for the Arboretum's home page and to 
maintain its Local Area Network computer system.
    Your U.S. National Arboretum is repository of a huge backlog of 
useful horticultural information to place on its home page. It has a 
talented staff the fruits of whose labors should be available on the 
Internet. Ultimately, the home page and server, with interactive 
systems, can be your National Arboretum's major method for dispensing 
horticultural information and providing horticultural education to 
constituents across the United States and indeed world-wide.
    While the missions of the U.S. National Arboretum mandated by 
Congress are research and education, the improvements described in this 
testimony are sorely needed to enhance its capability to fulfill its 
mission of education and to promote our research capabilities.
    FONA is most appreciative of the efforts of your Subcommittee on 
behalf of your National Arboretum and on behalf of horticultural 
research and education.
                                 ______
                                 
       Prepared Statement of the Grocery Manufacturers of America
    GMA appreciates the opportunity to submit testimony to the Senate 
Agriculture Appropriations Subcommittee on the President's fiscal year 
2000 budget. GMA is the world's largest association of food, beverage 
and consumer product companies. With U.S. sales of more than $450 
billion, GMA members employ more than 2.5 million workers in all 50 
states. The organization applies legal, scientific and political 
expertise from its member companies to vital food, nutrition and public 
policy issues affecting the industry. Led by a board of 44 Chief 
Executive Officers, GMA speaks for food and consumer product 
manufacturers at the state, federal and international levels on 
legislative and regulatory issues.
                               user fees
The Food Safety and Inspection Service (FSIS)
    We are disappointed that the proposed budget would again include 
``user fees'' to fund FSIS, even though the Administration, for the 
first time, has at least developed an alternative approach to assuming 
user fees in the budget. It also recognizes the fact that any user fee 
must be agreed to by all stakeholders and then authorized before it can 
be considered. Because of the nature of the anticipated authorizing 
language, we continue to have concerns about the Administration's lack 
of understanding of what exactly constitutes a true user fee. User 
fees, by definition, are intended to reimburse agencies for specific 
private benefits they provide to identifiable companies. Public funds 
and not user fees should pay for regulatory activities such as 
inspection. As Congress itself has repeatedly pointed out in previous 
years, these regulatory activities are designed to protect the public 
health and should not be funded by new taxes on the regulated 
industries.
The Food and Drug Administration (FDA)
    For the first time in many years, the President's proposed budget 
does not impose general purpose user fees to fund the FDA. However, it 
does include a proposal to implement a user fee above the baseline for 
premarket approval of direct and indirect additives. We have not taken 
a position on the proposal at this time because we have not seen 
legislative language.
    We were also pleased to see that, in the Center for Food Safety and 
Applied Nutrition's 1999 list of priorities, the premarket review of 
food ingredients was included on the ``A'' list. As GMA has said, 
beginning with the June, 1995 hearing before the House Human Resources 
Subcommittee, this is an area of FDA which has been dramatically 
overlooked, and must be reformed. In fact, the industry has made this a 
high priority and is in discussions with the Food and Drug 
Administration about how to best proceed on reforming the food additive 
approval process. GMA is legitimately concerned about the length of 
time it takes for an additive to be approved. The process needs 
continued attention of FDA senior management and more resources.
                 the president's food safety initiative
    The President's proposed fiscal year 2000 budget includes an 
increase of $74.8 million to fund the President's Food Safety 
Initiative. We applaud the efforts of the Administration to place such 
a high priority on enhancing the U.S. food safety system. GMA has long 
believed that consumers and the food industry are best served by strong 
food safety agencies. which develop policy based on sound science.
    Since the announcement of the President's food safety initiative in 
May, 1997 GMA has actively engaged in discussions within its industry, 
with Congress and with the Administration on the U.S. food safety 
system. In response to the Congressional directive, to the National 
Academy of Sciences to study ways in which the U.S. food safety system 
might be improved, GMA formed a food safety task force in December, 
1997, composed of 15 major food industry associations representing 
hundreds of manufacturers, marketers, wholesalers, retailers and 
restaurants. Over the next several months, the task force developed a 
series of white papers the industry felt were critical to a 
constructive evaluation of the current food safety system. The Task 
Force's papers were provided to the NAS committee for its 
consideration.
    GMA found that, while the current food safety system is not 
perfect, it is effective. The current system can and should be enhanced 
but not replaced. The goals of the President's Food Safety Initiative 
are admirable and are focused in the right direction. The U.S. food 
safety system must have more resources to identify and fight the true 
causes of foodborne illness with the right scientific weapons. 
Resources must be targeted toward laboratory research and practical 
testing food safety research which should receive high priority and 
funding.
    Second, we also support increased funding for educational programs. 
Everyone who handles food from the farm to the table must be educated 
about their roles in helping to reduce the risk of foodborne illness. 
We support the President's Food Safety Initiative's focus on the 
development of education programs for food service workers and 
educational programs that target high-risk under-served populations. 
Using the Fight BAC Program and other methods will achieve the goal of 
teaching all Americans how to handle and prepare food safely.
    Finally, GMA supports the efforts of the President's newly formed 
Food Safety Council, which has begun work on a unified food safety 
budget as well as a long term strategic plan, scheduled for release in 
January, 2000. Better communication, coordination and elimination of 
duplicate government food safety programs is needed.
                                summary
    To summarize, GMA supports increased funding for the President's 
Food Safety Initiative, and opposes any general purpose food user fees. 
We appreciate the opportunity to submit testimony for the record.
                                 ______
                                 
  Prepared Statement of the Health Industry Manufacturers Association
                                summary
    This testimony is submitted on behalf of the Health Industry 
Manufacturers Association (HIMA) and the more than 800 manufacturers we 
represent. HIMA is the largest medical technology trade association in 
the world. Our members manufacture nearly 90 percent of the $58 billion 
of health care technology products purchased annually in the United 
States and more than 50 percent of the $137 billion purchased annually 
around the world. We welcome the opportunity to comment on issues 
surrounding FDA's funding for the next fiscal year.
    This year marks a departure from the position HIMA has taken on 
funding for FDA for the past few years. This year, we believe there 
should be an increase in funding for the Center for Devices and 
Radiological Health (CDRH) that is specifically targeted to the 
following activities:
  --Premarket review process
  --Activities associated with mutual recognition agreements and 
        international harmonization, and
  --The Sentinel Reporting System
    With regard to additional recommendations for increased funding 
contained in the President's fiscal year 2000 budget and FDA's budget 
accountability, our position is as follows:
  --Congress should (1) ensure the optimal design of the Adverse Event 
        Reporting System and (2) direct the agency to invite 
        participation by interested parties in its design.
  --Congress should direct the agency to invite participation by 
        interested parties in the design of the Sentinel Reporting 
        System.
  --Congress should continue to press for greater budget accountability 
        from FDA.
  --We remain opposed to user fees and believe Congress should provide 
        sufficient funds to enable the agency to review device 
        applications within the time frames mandated by law.
                basis for increased funding for devices
    In the past, we have supported level funding for CDRH. However, 
this year, there are several factors that convince us that, unless CDRH 
receives additional funds for the premarket review process, review 
times could increase thus depriving patients access to beneficial 
medical technology. Moreover, we believe FDA needs to invest resources 
now in initiatives that will ultimately result in a harmonized 
worldwide regulatory system. We do not wish to see a return to the 
circumstances of several years ago when products were regularly 
available to people outside the United States years before American 
citizens could benefit from them.
    Among the reasons for our support of a targeted increase in funding 
is that FDA itself has announced loudly and clearly that it cannot 
carry out its statutory obligations without additional resources. 
Moreover, the agency has taken on new responsibilities-notably in the 
tobacco and food safety areas-without full funding. The Food and Drug 
Administration Modernization Act of 1997 (FDAMA) has been implemented 
without any additional funding.
    At the Food and Drug Law Institute's annual educational conference 
in December of 1998, FDA's Associate Commissioner for Strategic 
Management, Linda Suydam, estimated that the agency is $165 million 
short of what it actually needs to do its job. She stated that ``The 
agency has been effected by . . . new programs, which were not fully 
funded and flat-lined budgets which did not allow for the cost of 
inflation on personnel and procurement dollars. These numbers clearly 
illustrate that there's less money to do our core responsibilities.'' 
Those core responsibilities include device reviews, she stated.
    In the ``FDA Compliance Plan'' required by FDAMA and its budget 
justification documents, the agency projects that its review times for 
fiscal year 1999 will increase from fiscal years 1997 and 1998. In the 
plan, the agency cites insufficient funds as well as the increased 
complexity of medical technology for the longer review times. This is 
an alarming statement and one that is completely counter to the 
underlying goal of FDAMA to create efficiencies that help speed 
beneficial technology to patients.
    We strongly believe that FDA should have the resources to meet its 
statutory time frames. This means the completion of final actions for 
PreMarket Approval Applications (PMAs) within 180 days and 510(k)s 
within 90 days. The agency has been expressing its review goals in 
terms of completion of first actions within the statutory time frames. 
The ``Compliance Plan'' mandated by FDAMA required the agency to tell 
Congress how it was going to meet all of its obligations under the 
Federal Food, Drug, and Cosmetic Act--including the obligation to 
complete reviews within established limits. We believe the agency 
should let Congress know exactly what resources are needed in order to 
meet the statutory time frames set forth in the law. We support a 
funding plan that will ultimately result in full compliance with the 
law's time limits.
                  streamlining the regulatory process
    Although we support increased funding targeted to device reviews, 
we believe that the need for increased funds should diminish in future 
years. Through full implementation of FDAMA, continued reengineering, 
effective execution of mutual recognition agreements, and aggressive 
international harmonization activities, FDA should be moving steadily 
toward a regulatory system that will be more efficient, faster, and 
less costly. This system should reduce unnecessary governmental 
procedures, eliminate regulatory redundancy, provide a uniform 
framework for protecting and promoting public health worldwide, and 
recognize and adapt to the realities of the global economy.
    FDAMA mechanisms that, when fully implemented, will reduce 
regulatory burden include adoption and use of national and 
international standards, reliance on the declaration of conformity to 
standards, exemptions from 510(k), and adoption of a sentinel reporting 
system. In addition, FDAMA's requirement that FDA consider the ``least 
burdensome'' appropriate means of demonstrating effectiveness has yet 
to be fully defined and incorporated into standard operating procedure. 
This should, over time, together with the new collaboration 
requirements of FDAMA, result in a net savings of resources although 
more time may be spent at the beginning of the premarket approval 
process while the parties come to a meeting of the minds on the 
blueprint for device approval. Similarly, the agency has a variety of 
reengineering initiatives in the early stages of implementation that 
have the potential to ripen into substantial resource savings tools. 
Examples include the special and abbreviated 510(k)s, guidance on when 
to file a PMA modification, and the product development protocol. 
Congress should direct the agency to aggressively and fully implement 
the tools of FDAMA and the agency's own reengineering mechanisms.
                          global harmonization
    While the above initiatives concern the current processes for 
device review, FDA should not discount the potential savings to be 
realized from ongoing and future mutual recognition agreements and 
international harmonization activities. The need for federal funds will 
be reduced as devices approved offshore in accordance with harmonized 
requirements will not need to be re-reviewed by FDA.
    This past year, the United States and the European Union entered 
into a Mutual Recognition Agreement (MRA). This agreement authorizes 
its signatories to review and approve devices based on the requirements 
of the other parties to the agreement, thus providing a forum for one-
stop shopping for manufacturers. The agency is in the midst of 
determining the level of resources to be devoted to a confidence-
building period required by the MRA. Through this activity, U.S. and 
European officials will learn about each other's requirements for 
regulating medical devices. This type of learning among nations is an 
important building block to a new global system that will reduce 
unnecessary, time-consuming, and costly regulatory redundancy. 
Investing the time and resources now to build a foundation of trust and 
respect will contribute enormously to the long-term goal of harmonizing 
regulatory requirements with Europe and provide valuable lessons for 
other global harmonization initiatives.
    Ultimately, the forces of the global marketplace will drive nations 
of the world to recognize the economic value and efficiencies of a 
unitary worldwide regulatory system. Such a system will reduce if not 
eliminate duplicative reviews and inspections, with the added benefit 
of standardizing public health protection for patients throughout the 
world. The United States does not have a monopoly on what is the best 
approach to protecting and promoting the public health. In fact, there 
is some evidence to suggest that the European device approval process 
is faster and more efficient than our system with no demonstrable loss 
of product safety or quality. Aggressive and full participation by FDA 
in discussions with nations on a common sense approach to regulatory 
requirements worldwide will hasten the day when international 
harmonization becomes a reality. And, while we recognize that this type 
of activity costs money in the short term, in the long term, it should 
reduce the financial burden to U.S. taxpayers as other nations share 
responsibilities formerly performed exclusively by FDA.
                the president's fiscal year 2000 budget
    We note that the President's fiscal year 2000 budget requests an 
increase of $26 million for the device program--$7 million in user fees 
for premarket reviews and $19 million for improved inspections, MRA 
implementation, compliance activities, the Sentinel Surveillance 
System, and adverse event reporting.
    HIMA opposes user fees for the medical device industry and believes 
Congress should provide sufficient funds to the agency to enable it to 
review applications within the time frames mandated by law. This core 
statutory obligation is essential to ensuring patient access to the 
benefits of medical technology.
    With regard to inspections, we applaud the agency's recent efforts 
to streamline the inspection process.\1\ The industry has worked with 
the agency in a ``grass-roots'' initiative to bring common sense 
changes to key aspects of the inspection process.1 We believe that 
there are additional efficiencies that can be realized through 
continued agency-industry discussions. At the FDAMA-mandated 
stakeholders meeting of August 18, 1998, we suggested that the agency 
take into account inspections conducted by internationally recognized 
organizations in executing a risk-based inspection strategy. We 
continue to believe that ISO (International Standards Organization) 
certification should provide some level of assurance to FDA that good 
manufacturing practices are being followed.
---------------------------------------------------------------------------
    \1\ One pending change that we strongly support is an agency 
proposal to ``credit'' time spent by field personnel in educational and 
outreach activities that promote voluntary compliance by the industry 
rather than focusing solely on actual inspection time as a performance 
measure.
---------------------------------------------------------------------------
    In addition, we note that the agency itself has questioned the 
biennial inspection requirement in the statute for certain 
manufacturers.\2\ We support giving FDA the flexibility to exercise its 
own discretion in determining the frequency of reviews necessary to 
assure safety, based on the risk presented. Other types of flexibility 
may also be desirable.
---------------------------------------------------------------------------
    \2\ In the FDAMA-mandated ``FDA Plan for Statutory Compliance'' 
published in the Federal Register on November 21, 1998, the agency 
said, in a section on inspections, ``Because all public and private 
sector organizations in the future will be subject to the same 
resource-constrained environment, FDA may have to consider that even a 
highly collaborative inspectional network may not be adequate to 
completely meet existing statutory inspection requirements. A strategic 
reassessment may be in order to determine the kinds of statutory 
flexibility that would be desirable to preserve the comprehensive 
consumer protection intent of the FD&C Act, and at the same time, allow 
FDA to address the most critical health and safety priorities.''
---------------------------------------------------------------------------
    The Sentinel Surveillance System--designed to replace reporting of 
adverse events by device user facilities (hospitals, nursing homes, 
etc.)--is one that holds great promise for improving the ability to 
collect meaningful information about device-user interaction. We 
believe it also has the potential to eliminate medical device reports 
from manufacturers. We support increased funds devoted to this system. 
However, we believe that it is important for the system to be well 
designed and provide optimal benefits for the provider, the agency, and 
the manufacturer. We recommend that the agency participate in a 
tripartite working group to engage in discussions as to how such a 
system can best meet the needs of the various interested parties.
    The agency's proposal for increased funds for the Adverse Event 
Reporting System (AERS)--totaling $15.3 million agency-wide--raises 
questions about whether such an expensive system will produce the 
intended results. We know little about the system and simply urge 
Congress to ensure that (1) there is a real need for this system and 
(2) its benefits will justify its costs. We believe that the system 
could benefit from an open airing of the agency's plans early in the 
design stages. Such an airing would enable industry and other 
interested parties to provide valuable observations and comments to 
help ensure that taxpayer dollars are being spent wisely.
    On a process-related matter, we strongly support this 
Subcommittee's efforts to seek greater accountability from the agency 
on the allocation and use of taxpayer dollars appropriated by Congress. 
The submission of detailed operating plans from the agency to this 
subcommittee is key to ensuring appropriate execution of the laws of 
the land. We are grateful for your initiative in this area and urge the 
continuation of this important process.
                               conclusion
    In conclusion, we support a funding increase for FDA for fiscal 
year 2000 that is specifically targeted to device review functions, MRA 
confidence building, international harmonization activities, and the 
Sentinel Surveillance System. We ask Congress to ensure that such funds 
are not diverted to other agency activities. We believe this increase 
will help the agency meet its statutory obligations, advance the long 
range harmonization goal, and provide the means whereby the agency can 
achieve its FDAMA-mandated mission to ``promote the public health by 
promptly and efficiently reviewing clinical research and taking 
appropriate action on the marketing of regulated products in a timely 
manner.'' We further believe the Congress should encourage the agency 
to continue to seek improvements in the inspection process--including 
consideration of legislation to enable the agency to exercise 
discretion in the frequency of inspections. We urge Congress to help 
open the agency to input and ideas from interested parties on key 
initiatives such as the Sentinel Surveillance System and the Adverse 
Event Reporting System. We oppose user fees for the medical device 
industry. Finally, we support this subcommittee's continued efforts to 
seek greater budget accountability from FDA.
    Thank you for the opportunity to present our views.
                                 ______
                                 

     Prepared Statement of the Humane Society of the United States

    We appreciate the opportunity to provide testimony to the 
Agriculture and Rural Development Subcommittee on two funding items of 
great importance to the Humane Society of the United States and its 6.7 
million members and constituents. As the largest animal protection 
organization in the country, we urge the Committee to address these 
priority issues in the fiscal year 2000 budget.
                         the animal welfare act
    The Animal Welfare Act, the federal law designed to protect animals 
in research, exhibition, and commercial breeding facilities, as well as 
animals transported in interstate commerce, is in danger of becoming an 
empty promise. Due to a serious shortfall in the U.S. Department of 
Agriculture's Animal and Plant Health Inspection Service (APHIS)/Animal 
Care budget, regulated facilities and the public cannot depend upon 
having the high quality inspection program and consistent enforcement 
of federal animal welfare regulations that are vital to demonstrating 
compliance with the law. Funding of $13 million for APHIS/Animal Care 
is urgently needed in fiscal year 2000 to protect animals as Congress 
mandated and the public expects.
    Funding for enforcement of the Animal Welfare Act has been stagnant 
since 1991. The Animal Care (AC) unit received $9.175 million in fiscal 
year 1999 to cover, among other things, inspections of more than 10,500 
separate locations at regulated entities--research facilities; 
exhibitors such as zoos and circuses; animal dealers and breeders; and 
animal carriers such as airlines and ground freight handlers.
    The AC funding situation has reached a crisis point, not only 
jeopardizing the well-being--indeed the very lives of millions of 
animals--but also threatening consumer protection and public health. 
USDA Inspector General audits over the last decade have confirmed our 
organization's concerns that APHIS cannot ensure humane care and 
treatment of animals at all facilities covered by the Animal Welfare 
Act as Congress intended with the resources currently provided.
    In a commendable effort to streamline the unit, AC headquarters 
administrative and support staff have already been reduced by 35 
percent and five sector offices are being consolidated into two. At 
this point, the erosion in AC's funding is compromising the quality and 
quantity of its inspectors and other direct enforcement efforts. 
Despite the need for at least 100 well-trained inspectors around the 
country, Animal Care had only 88 at its maximum in fiscal year 1991 and 
the number has continued to decline due to budget limitations. This 
year, the field staff will be cut to 70 inspectors.
    Because of staff and other resource reductions, the number of 
inspections has declined by nearly 50 percent between fiscal year 1993 
(AC's most productive year to date) and fiscal year 1998. Diminishing 
AC funds have also caused inspections to be increasingly complaint 
driven, meaning that AC is responding to situations where animal well-
being may already be severely compromised. True animal welfare depends 
on a proactive approach that prevents animal abuse by assuring 
compliance with the law, rather than on a reactive enforcement process 
that starts only after animal abuse has occurred.
    The Humane Society of the United States is pleased to join forces 
on this request with an unprecedented coalition of approximately 400 
national and grassroots organizations representing regulated facilities 
and animal interests. We urge the Committee to appropriate $13 million 
for the APHIS Animal Care unit in fiscal year 2000 to begin addressing 
these urgent needs.
                        the horse protection act
    Enacted by Congress in 1970, the Horse Protection Act was passed to 
end the obvious cruelty of physically soring the feet and legs of 
horses. In an effort to exaggerate the high-stepping gate of Tennessee 
Walking Horses, unscrupulous trainers use a variety of methods to 
inflict pain on sensitive areas of the feet and legs for the effect of 
the leg-jerk reaction that is popular among many in the show-horse 
industry.
    Just as in 1970 the practice of soring was rampant, in 1999 the 
practice continues unabated by the well intentioned but woefully 
underfunded, understaffed APHIS inspection program. The authorization 
limit for enforcement of the Act has been frozen at $500,000 since the 
enactment of the law, and the annual appropriation of $350,000 has been 
consistently inadequate for proper enforcement of the law.
    In April of 1998, the Tennessean ran a front page story reporting 
that USDA veterinarians had found 673 cases of soring since 1987, 
despite the fact that they were able to attend only 10 percent of the 
shows. They also found that nine of the last 16 winners of the Trainer 
of the Year award had either been suspended from showing or have cases 
pending for soring. The practice of soring is more entrenched today 
than when Congress originally acted in 1970. In response to a 
questionnaire from the Tennessee Walking Horse Breeders and Exhibitors 
Association, the head of the largest industry competition held annually 
in Shelbyville, TN stated that every trainer of Tennessee Walking 
Horses sores them with chemical irritants, heavy chains, or painful 
shoeing practices. The will of Congress has clearly been thwarted.
    In a less than magnanimous gesture to the cash-strapped APHIS 
enforcement authority, in 1976, Horse Industry Organizations pushed for 
and won greater self-regulating authority. Unfortunately, the 
individuals trained to be Designated Qualified Persons (DQP) have not 
been willing or able to responsibly enforce the act. Industry 
inspectors consistently report fewer than half the number of violations 
cited when APHIS personnel are present. As a result, thousands of 
horses continue to suffer an outdated torture under the guise of 
training.
    Since the day that the Horse Protection Act was passed, Horse 
Industry Organizations have sought to undermine the spirit of the law 
by managing soring with loopholes and road blocks instead of ending the 
cruel practice. Given past enforcement funding levels, Congress also 
has failed to ensure meaningful enforcement of the Horse Protection 
Act. To end the practice of soring, APHIS must receive adequate funding 
to carry out the provisions of the Act. The Humane Society of the 
United States urges the Committee to approve a modest increase of 
$150,000 in fiscal year 2000, to achieve the full $500,000 annual 
appropriation of funds authorized under the Horse Protection Act.
    Again, we appreciate the opportunity to share our views and 
priorities for the Agriculture and Related Development Appropriation 
Act of fiscal year 2000. We hope the Committee will be able to 
accommodate these modest funding requests to address some very pressing 
problems affecting millions of animals in the United States. Thank you 
for your consideration.
                                 ______
                                 

         Prepared Statement of Illinois Institute of Technology

    Chairman Cochran, Senator Kohl, Senator Durbin and members of the 
subcommittee, I am Darsh Wasan, Ph.D, Vice President and Motorala Chair 
at the Illinois Institute of Technology (``IIT''), Chicago, Illinois. I 
want to thank the subcommittee for the opportunity to submit this 
testimony for the record on behalf of IIT's National Center for Food 
Safety and Technology (the ``Center'') located at our Moffett Campus in 
Summit-Argo, Illinois. The Center is a unique collaboration of 
government, academia and industry scientists, all focused on the safety 
of the food on our tables.
    I am submitting this statement primarily to thank you, Mr. 
Chairman, Senator Kohl, our home state senator, Senator Richard Durbin, 
and the rest of the subcommittee for your past support of the Center. I 
also want to update you on the work the Center is performing with its 
principal partner, the United States Food and Drug Administration 
(``FDA''), through the FDA's Center for Food Safety and Applied 
Nutrition (``CFSAN''). The Center supports the FDA in its mission to 
ensure the safety of all food products other than meat and poultry. The 
Center works with FDA to develop methods to detect and prevent life 
threatening pathogens from contaminating our nation's food supply. The 
recent deadly outbreak of Listeria that killed 20 people emphasizes the 
importance of food safety. Although not directly involved with this 
Listeria outbreak, as it involved processed meats, the Center routinely 
conducts research and education programs to decrease the incidence of 
Listeria, E.coli and Salmonella in other types of food.
    The Center's collaboration between government, academia and the 
food industry--to develop methods to detect and prevent contamination 
of foods--is what makes the Center so unique. The Center was founded on 
the belief that open communication among government regulators, the 
scientific community and the food industry is the best way to establish 
a current knowledge base for food safety and for ensuring compliance 
with FDA regulations. This makes the Center not only a laboratory for 
scientific research. It is also makes the Center a laboratory in public 
policy. It is a laboratory where technologies for safer foods are 
transferred to the private sector, where food safety standards are 
defined and improved and where the ``regulated'' work with the 
``regulators'' in a non-adversarial setting. Indeed, a recent National 
Academy of Sciences report, Ensuring Safe Food, lists this type of 
collaboration as essential for an effective federal food safety system.
    IIT manages the Center. Our on-site Director is Charles Sizer, 
Ph.D., a highly regarded food scientist with years of experience in 
private industry and academia. I oversee the Center from IIT's Main 
Campus. I take great pride in the fact that I helped create the Center 
eleven years ago, in 1988. We started with a grant of $3.7 million from 
the FDA and a gift of a pilot plant and five buildings from Corn 
Products International in Summit-Argo. Since then, we have had 
``Cooperative Agreements'' with the FDA through which we have operated 
the Center. The effectiveness of this concept has made for a satisfying 
long-term relationship for both IIT and me. This public-private 
partnership will be even more successful with the new FDA Commissioner, 
Dr. Jane Henney. Dr. Henney recently visited the Center. We were 
impressed by her commitment and interest in food safety.
    Most of the Center's research on food safety has been incorporated 
as part of the Clinton Administration's Food Safety Initiative. The 
Center presently has 18 of its own food science researchers working 
along side scientists from the FDA's Division of Food Processing and 
Packaging, which reports to Joseph A. Levitt, Director of CFSAN in 
Washington, D.C. NCFST and FDA scientists use the Center's facilities 
and laboratories to conduct their research side by side with private 
industry scientists.
    The Center receives $2 million annually from the FDA. The Center 
uses this funding for the salaries and expenses of its own food 
scientists, the operation of laboratories and scientific equipment and 
the maintenance of its buildings and facilities. Those facilities 
include a ``pilot plant'' in which the Center has a ``pathogen 
containment'' laboratory for validating commercial-scale food 
processing equipment. The Center's budget includes another $1.5 million 
from corporate members, outside grants, and program income.
    Presently, 47 food industry companies are members of the Center, 
including Kraft Foods, Inc., Corn Products, Inc., Bestfoods, Inc., 
General Mills, Inc., FMC Corporation, and Quaker Oats. Representatives 
of member companies serve with representatives of the FDA and academia 
on committees that direct the Center's activities, including selection 
and oversight of research projects. The research projects provide 
information for the FDA to use as it makes its regulatory decisions.
    This collaboration has resulted in cutting edge research and 
development in food safety. The NCFST's accomplishments include the 
following:
    (1) Developed a test for rapidly detecting E. coli O157:H7 in 
foods. This procedure is currently being used in food plants to improve 
product safety;
    (2) Established a pilot-scale pathogen containment laboratory for 
testing commercial-size food processing systems. This laboratory has 
the actual process operations to demonstrate the inactivation of 
pathogens like Salmonella and Listeria;
    (3) Organized a Sprout Safety Task Force with the International 
Sprout Growers Association to develop techniques for improving the 
safety of alfalfa sprouts. (The American Medical Association recently 
declared alfalfa sprouts ``high risk'' for Salmonella poisoning.);
    (4) Conducted industry-wide research to develop protocols for the 
safe use of recycled packaging material;
    (5) Conducted a workshop resulting in the establishment of 
guidelines for a new process to eliminate pathogens in liquid foods 
containing particles such as soups and stews;
    (6) Formed a Task Force of 20 leading industrial partners to obtain 
approval of specific polymer packages to be used with irradiated foods. 
These packages will be used to protect red meats and poultry from 
contamination after they have been irradiated;
    (7) Assisted industry in establishing the criteria for the safe 
processing of aseptically processed entrees in convenient packages. 
Aseptically processed foods provide the highest level of safety for 
convenience foods and home meal replacements;
    (8) Contributed to the development of a high pressure process to 
make raw oysters safe to eat by eliminating Vibrio vulnificus bacteria; 
and
    (9) Developed high pressure and ultra-violet light processes to 
kill pathogens in fresh fruit juices.
    We believe these accomplishments are only a preview of the Center's 
future potential. We are proud to be part of the Administration's 
``Food Safety Initiative'' that will help us maximize our potential. As 
part of that initiative, the Administration is proposing an additional 
$75 million in its fiscal year 2000 budget. The FDA would receive $30 
million of that, $3.7 million of which would go to accelerating food 
safety research.
    In the future, the Center will work with its government and 
industry partners to obtain more commercial size food equipment so that 
its research continues to produce practical and realistic benefits. The 
Center will also expand its outreach and collaboration with the food 
industry. For example, the Center will interact more with small-to-
medium sized food companies. Many small food processors and packagers 
do not have the resources to address the complex technical and 
regulatory issues associated with food safety. The smaller enterprises 
desperately need to leverage the Center's knowledge and facilities to 
test the integrity of their processes. The Center will also continue 
implementation of a unique new membership category called ``Task Force 
Member.'' This new membership will allow the Center to rapidly mobilize 
industry resources to respond to public health hazards. A ``Task 
Force'' participant becomes a temporary member of the Center for the 
duration of the project. Resources for the project are raised by the 
Task Force and funds are allocated by ``Task Force'' members. This 
alliance exemplifies the Center's effort to bring government, academia 
and private industry together to respond rapidly to the causes of food 
borne outbreaks.
    Mr. Chairman, the National Center for Food Safety and Technology 
hopes that it can continue to contribute to the integrity of the 
nation's food supply. Commissioner Henney, CFSAN Director Levitt and 
their FDA colleagues give us reason for that hope. Our industry members 
also give us reason for optimism. With your leadership and support, and 
that of Senator Kohl's and Senator Durbin's, the National Center for 
Food Safety and Technology will become an example to other federal 
agencies of how limited federal monies can be spent with maximum 
benefit to the taxpayers. It will become an example of how cooperation, 
rather than contest, can produce the maximum benefit to the public 
health.
    Thank you again for the opportunity to submit this testimony for 
the record.
                                 ______
                                 
         Prepared Statement of the Illinois Soybean Association
    Mr. Chairman and distinguished members of the Agriculture, Rural 
Development, FDA, and Related Agencies Subcommittee: We represent the 
Illinois Soybean Association, an organization of approximately 3,200 
leading soybean farmers. Among other goals, we foster well-coordinated 
public and private research leading to safe, nutritious, healthy, 
affordable, and convenient soy products for consumers and sustainable 
competitive advantage for the U.S. and Illinois soy industries.
    We request that $3.5 million in federal funds be authorized to plan 
and construct a Soybean Disease Biotechnology Research Center within 
the National Soybean Research Laboratory (NSRL) located at the 
University of Illinois. If federal funds are secured, the Illinois 
Soybean Checkoff Board will contribute $500,000 in program support 
initially and entertain proposals for additional support. We will ask 
the University of Illinois to provide approximately 8000 square feet of 
shell space within the building housing the National Soybean Research 
Laboratory and will seek $500,000 in state funds to equip the Center. 
We will also ask the University to provide access to utilities and 
connections for a big-containment greenhouse proposed as part of the 
Center and, henceforth, to staff, operate, and maintain the Center in 
support of soybean disease biotechnology research.
                           role of the center
    The Soybean Disease Biotechnology Research Center will be the first 
line of defense against major soybean diseases that threaten the U.S. 
soybean industry, and to programmatically attack current disease 
problems, such as the soybean cyst nematode (SCN). It will provide 
outstanding research talent and state-of-the-art facilities, equipment, 
and support services for cutting-edge biotechnology research on major 
soybean diseases. The Center will bring the power of the new sciences 
of structural, comparative, and functional genomics and genetic 
transformation to bear on SCN and other current and potential disease 
threats, including major diseases not yet in the U.S., such as soybean 
rust.
    Center researchers will identify and create new and improved 
mechanisms of disease escape, tolerance, and resistance. The aim is to 
protect the soybean crop and increase its profitability throughout the 
industry. Genetic disease control mechanisms in the germplasm and 
genetic stocks of the National Soybean Germplasm Collection, located at 
the University of Illinois, will be a unique, readily accessible 
resource for the Center. In addition, genetic mechanisms of escape, 
resistance, and tolerance in other species will be identified and 
transferred to the soybean. Accordingly, highly effective disease 
control genes can be used for ``stacking'' in soybean varieties. This 
will assure the realization of gains from other genetic improvements, 
such as unique quality traits.
           setting for soybean disease biotechnology research
    Researchers in the Soybean Disease Biotechnology Research Center 
will use the support services of the University of Illinois' new Keck 
Center for Comparative and Functional Genomics, with its high 
throughput genetic sequencing and unequaled bioinformatics 
capabilities. This will greatly facilitate evaluation of materials in 
the National Soybean Germplasm Collection. Researchers will also have 
ready access to the University of Illinois Biotechnology Center, which 
provides recombinant DNA and protein science services, immunological 
resources, flow cytometry, high capacity transgenic plant production, 
and cell and tissue culture, among other valuable support services.
    There will be direct access to superb conventional greenhouse and 
controlled environment facilities in adjacent, connected structures. As 
part of this project, a big-containment greenhouse will be constructed 
specifically to provide the levels of isolation and protection required 
for sophisticated disease biotechnology research. An elaborate system 
of research farms will be available for testing new developments in a 
wide range of soil, climatic, and socio-economic conditions.
    The Center will complement and connect with the new St. Louis-
headquartered Danforth Plant Science Center and participate in the 
Illinois Missouri Biotechnology Alliance. By virtue of the Center's 
location within the federal-state-industry-sponsored NSRL, work at the 
Center will be strategically integrated with other public and private 
efforts to conceive, plan, and implement soybean production and 
marketing systems of the future. This will foster interdisciplinary and 
cross-functional efforts that speed development and adoption of new 
technology and gain competitive advantage for the U.S. soybean 
industry.
    NSRL is a major interface between the soybean industry, as 
represented by state and national soybean organizations and checkoff 
boards, and university research and education programs. NSRL was 
created by a USDA special grant of $5 million, which was used to 
renovate 30,000 square feet of space in a University of Illinois 
building and provide facilities for NSRL research and education 
programs. NSRL is directed by a Chair Professor of Agricultural 
Strategy, the only so-named professorship in the nation. The Chair 
position was endowed by the soybean industry, which contributes $40 to 
$80 million annually to soybean research.
    NSRL fosters strategic public/private alliances within the soybean 
industry and with other commodity-based industries. It achieves 
extraordinary levels of communication, coordination, and integration of 
publicly and privately financed research and educational programs 
across the nation. As developer of STRATSOY, the most sophisticated and 
useful commodity website, NSRL provided the soybean industry with a 
powerful tool for uniting its far-flung checkoff funded programs, 
disseminating information, eliminating redundancy, sharpening strategic 
focus, and increasing the return on both public and private investment 
in soy research.
    Its location within NSRL will assure that research in the Soybean 
Disease Biotechnology Research Center will fully complement and benefit 
from other soy research programs across the nation and world. It will 
assure that the results of fundamental soybean disease biotechnology 
research are quickly translated into practical technology, useful 
information, and sustainable competitive advantage for the industry. 
The NSRL mission of increasing the volume of profitable, sustainable 
business in the soy industry will become the mission of the Soybean 
Disease Biotechnology Research Center.
    This is an excellent time to establish the proposed Center because 
the University is initiating its Postgenomic Biotechnology Program in 
fiscal year 2000. A multi-million investment of state funds will 
provide 25 new biotechnology positions in functional genomics, 
bioinformatics, developmental biology, microanalytic systems, and 
cellular and molecular bioengineering. Within this framework, new 
positions in plant disease biotechnology will be filled with 
outstanding scientist/educators who already have established impressive 
track records. Under this program, leading biotechnology scientists 
will be recruited for the Soybean Disease Biotechnology Research 
Center.
                          goals of the center
    The Soybean Disease Biotechnology Research Center will:
    1. Provide a superb setting for cutting-edge soybean disease 
biotechnology research.
    2. Foster and support the very best soybean disease biotechnology 
research team in the world.
    3. Assure that effective soybean disease escape, resistance, and 
tolerance genes are available for ``stacking'' in top U.S. soybean 
varieties.
    4. Eliminate the soybean cyst nematode as a major threat to the 
U.S. soybean industry and prevent harm from introduction of foreign 
disease organisms.
    5. Enable molecular soybean pathology research through which the 
Illinois and U.S. soybean industries will achieve and maintain 
preeminence in global and domestic markets for soybeans and soybean 
products.
    6. Enable the U.S. soy industry to capture proprietary benefits 
from soybean biotechnology research and other research conducted all 
over the world.
    7. Enhance the global and strategic significance of the National 
Soybean Research Laboratory and empower its scientists, thus maximizing 
its benefits for the nation.
           creating the soybean disease biotechnology center
    The Soybean Disease Biotechnology Research Center will be created 
by extensively remodeling approximately 8000 square feet of currently 
undeveloped space within the NSRL. This will provide elaborate 
laboratories, a bio-containment greenhouse in the adjacent greenhouse 
complex, instrument rooms, coldrooms, other workrooms, support 
facilities, and offices dedicated to soybean disease biotechnology 
research. To the extent feasible, physical connections will be 
established between the NSRL and the greenhouse complex linking the 
Soybean Disease Biotechnology Center to interconnected buildings 
housing the Keck Center, Biotechnology Center, and the University of 
Illinois' existing food and agriculture biotechnology research on 
animals, microbes, and other plants.
                                summary
    We request that $3.5 million be authorized to plan and construct a 
Soybean Disease Biotechnology Center within the National Soybean 
Research Laboratory at the University of Illinois.
                                 ______
                                 
              Prepared Statement of the State of Illinois
    As you begin to finalize your appropriations priorities for fiscal 
year 2000, I am submitting for your review, the enclosed book of 
appropriations goals and requests for the State of Illinois. I am 
hopeful that these requests can be included and accommodated in the 
upcoming appropriations process.
    These items reflect the input of the various state agencies, 
cities, and counties of Illinois. As you will see in the enclosed 
briefing book, the appropriations requests are organized by the 
appropriate subcommittee. In addition, these requests include both 
ongoing federal funding needs and new funding requests.
    For additional information about these requests, please call any 
member of my DC staff at 624-7760. Thank you very much for giving these 
requests your fullest consideration and your enthusiastic support.
          Agriculture, Rural Development and Related Agencies
                              agriculture
Special supplemental nutrition program for WIC
    Request: Support the Administration's proposed increase in the 
Special Supplemental Nutrition Program of $281 million.
    This will amount to an additional $15 million for Illinois.
Farmer's market nutrition program (FMNP) for WIC
    Request: Support funding for FMNP at the requested level of $20 
million.
    This is an increase of $5 million over the fiscal year 1999 
appropriation. This will expand the reach of FMNP to many Illinois 
communities. The current regulations require a 30 percent state match 
of the total award. The Illinois Department of Human Services supports 
changing the match to 30 percent of the administrative costs.
Infant formula rebate funds
    Request: Support language that would grant states the flexibility 
to use a portion of the infant formula rebate funds for infrastructure 
needs such as clinic expansion.
    Illinois currently receives $55 million annually in infant formula 
rebate funds.
Food stamp quality control system
    Request: Support language that would change Food Stamp regulations 
to allow standards to be adopted that would judge and compare state 
performance more effectively than the current single measure for 
payment accuracy.
    Under the current regulations, samples are taken in a single month 
to determine the correct food stamp allotment. Sanctions are levied if 
the state's payment error rate exceeds the average of all other states. 
This could result in millions of dollars in sanctions.
National corn to ethanol research pilot plant (NCERPP)
    Request: Support funding of $14 million for the National Corn to 
Ethanol Research Pilot Plant (NCERPP) in the fiscal year 2000 
Agriculture Appropriations bill.
    The State of Illinois has appropriated $6 million for construction 
of the NCERPP at Southern Illinois University-Edwardsville. The total 
cost of constructing the project is estimated at $20 million. The cost 
of operating the facility will be borne by industry and university 
research conducted at the plant.
    Congress appropriated $2 million for the Agriculture Research 
Service (ARS) for design work in the fiscal year 1996 and fiscal year 
1997 budgets.
Pseudorabies swine slaughter
    Request: Support full funding for Animal Plant and Health 
Inspection Service (APHIS). Illinois supports an appropriation of 
$75,000 from APHIS to institute a pseudorabies swine slaughter 
surveillance collection point at Johnsonville Packing, Momence, 
Illinois. The Administration is planning to cut funding for APHIS by 
$3.1 million for fiscal year 2000.
    Extrapolating from a recent survey of an average four-week kill, 
approximately 14,000 animals are processed at this plant every month. 
Of this kill, 32 percent of the swine were traced back to Illinois, 18 
percent to Iowa, and 17\1/2\ percent to Indiana. The cost of collecting 
the backtagged animals at this plant has been estimated to be $20,000, 
calculating 70 cent/sample. The laboratory testing would cost $55,000, 
making the total expenditure $75,000 to collect at the Momence Plant. 
This figure does not include shipping cost.
    Currently, Illinois is struggling to acquire an adequate number of 
slaughter surveillance samples to maintain the compliance established 
by the National Program Standards. Last year, first point testing was 
conducted at the end of the year to achieve the required numbers. It 
has been established that slaughter surveillance of cull sows and boars 
is the superior method of determining the PRV status in herds at the 
grassroots level.
    Failure to collect the needed number of surveillance samples will 
result in the need to initiate more costly methods of swine 
surveillance (i.e. first point testing or down the road testing). Swine 
producers from Illinois and neighboring states would benefit from the 
collection.
Voluntary Johne's disease herd certification program
    Request: Support full funding for Animal Plant and Health 
Inspection Service (APHIS).
    Illinois supports a one-time appropriation from APHIS for $200,000 
for the purpose of defraying the cost to producers wishing to enroll in 
the Voluntary Johne's Disease Herd Certification Program. This program 
allows a producer to do testing for the presence of Mycobacterium 
paratuberculosis.
    Johne's is an incurable wasting disease of cattle, sheep, goats and 
cervidae, contracted through direct contact with infected animals. 
Animals are generally infected at a young age, but may not exhibit 
signs of the disease until they are four or five years of age. It has 
been estimated that economic losses can amount to $227 per cow. A 
recent National Animal Health Monitoring System (NAHMS) sampling of 
Illinois dairy cows indicated a prevalence of at least 10 percent in 
the cull cows from the dairy herds tested.
    A positive serology test normally indicates the animal has Johne's 
Disease, at a lab cost of $5.00. To do a whole-herd test for a 100-cow 
operation, it would cost a producer $500 in laboratory costs alone. (A 
more accurate, time-consuming confirmatory test may also be run 
following a positive serum test, with a lab cost of about $7.00.) Both 
tests are run by the Illinois Department of Agriculture's two animal 
diagnostic laboratories at Centralia and Galesburg, and the diagnostic 
laboratory at the University of Illinois College of Veterinary 
Medicine.
    There are approximately 1,750 dairy farm families, 26,000 beef 
producers, and 3,100 sheep and lamb producers in Illinois. We have 
about 475,000 beef cows, 145,000 milk cows, 79,000 sheep and lambs, and 
an undetermined number of goat and cervid herds, which would qualify in 
this voluntary program.
    Under this proposed program, the producer would still be 
responsible for veterinary costs associated with acquiring the samples. 
This funding would offset the costs of the testing to the producer and 
encourage enrollment in this program. Animals certified under this 
program should be worth more money. Producers purchasing these animals 
would have a high degree of certainty the animals are free of Johne's 
Disease.
Swine producer laboratory testing
    Request: Support full funding for Animal Plant and Health 
Inspection Service (APHIS). Illinois supports a one-time appropriation 
from APHIS for $100,000 to defray the cost for swine producers 
conducting laboratory testing necessary to diagnose or maintain the 
health of their swine herds.
    With the current low prices for hogs, many producers are either 
foregoing diagnostic or preventative health measures in an effort to 
obtain some profit from their animals. Maintaining a healthy swine herd 
helps the producer produce his product in a more efficient manner. 
Providing this assistance would insure that animals that are 
unhealthful and diseased would have access to proper diagnosis and 
eliminate potential disease situations arising in the herd and possible 
spread within the swine industry. In 1997, Illinois produced 1.82 
billion pounds of pork, placing it fourth in US hog production. The 
number of hog producers in Illinois continues to drop: 8,800 hog farms 
in 1996; 7,500 hog farms in 1997; and 7,000 hog farms in 1998.
APHIS--Gypsy Moth ``Slow the Spread'' program
    Request: Support fiscal year 1999 funding levels to provide 
Illinois with $200,000 for the APHIS program.
    The Illinois Department of Agriculture, under authorities provided 
in the Insect Pest and Plant Disease Act, annually cooperates with 
APHIS and various units of local and county government to identify and 
control the Gypsy Moth in Illinois. The annual program includes both 
the identification of gypsy moth infestations as well as a treatment 
control program. In the past, no funding has been transferred between 
agencies. In the trapping (identification) program, the APHIS has 
concentrated on the Chicago Metropolitan area and the Illinois 
Department of Agriculture has worked in the balance of the state. Once 
an area is identified as being in need of a treatment control, the 
APHIS has provided the biological pesticide, the local unit of 
government has provided funding for the applicator and the Illinois 
Department of Agriculture has provided overall project oversight and 
coordination. In fiscal year 1999, the APHIS provided funding to states 
for an expansion of the trapping (identification) program to attempt to 
further reduce the spread of the insect.
Invasive species program
    Request: Support the Administration's proposed $16 million increase 
to U.S. Department of Agriculture programs intended to combat invasive 
species (plants and animals non-indigenous to the U.S.) which are 
negatively impacting many areas of the nation.
    The recent detection and eradication efforts associated with the 
Asian long-horned beetle in Chicago and New York are examples of the 
types of programs to be supported through this new initiative. No 
further information is available relative to the possible transfer of 
funds to states at this time. However, this initiative could have a 
significant impact of the Illinois Department of Agriculture's 
administration of the Insect Pest and Plant Disease Act as well as the 
Illinois Nursery Industry.
Natural Resources Conservation Service (NRCS) budget shortfall due to 
        section 11 cap
    Request: Support for Amendment Number 115 to S. 544 Supplemental 
Appropriations. This amendment provides $28 million in additional 
funding under the Section 11 cap to deal with the States (Illinois is 
one) where NRCS has severe budget shortfalls for fiscal year 1999 which 
will seriously impact the delivery of Farm Bill Programs.
    In Illinois, the NRCS has a budget deficit of $1.8 million in 
fiscal year 1999. If Amendment 115 to S.544 does not pass, the state 
NRCS will furlough all Illinois NRCS employees at least 35 days. This 
will have a devastating impact on all Illinois conservation and 
watershed programs. It will directly impact 1,825 program applications, 
480 Illinois conservation projects, 1,257 conservation and resource 
plans and over 401,100 rural and urban Illinois constituents. There is 
no State funded Agency or entity who can fill the void in the technical 
assistance that will be lost. No other federal agency can deliver the 
local technical assistance that NRCS has provided for in each county of 
the State. NRCS has worked very closely with the Soil and Water 
Conservation Districts (SWCDs) to help maintain and improve natural 
resources in every county. The State has committed $48 million dollars 
to the Illinois River Conservation Reserve Enhancement Program (CREP) 
which will be severely hampered if NRCS furloughs employees. All other 
conservation and watershed programs statewide will also be hampered.
Illinois groundwater consortium
    Request: Illinois supports $3,000,000 for the Department of 
Agriculture to restore and expand funding for the Illinois Groundwater 
Consortium (IGC).
    Funding for the Consortium was not included in the fiscal year 1999 
USDA budget. Restoration and an increase to the requested level in 
fiscal year 2000 will enable the Consortium to continue and expand 
research and outreach programs that provide a scientific base for 
management and regulatory decisions on the use and protection of water 
and land resources.
    In 1990, Southern Illinois University at Carbondale joined forces 
with Illinois State Geological Survey, Illinois State Water Survey, 
Southern Illinois University at Edwardsville, University of Illinois 
Cooperative Extension Service, and the University of Illinois 
Agricultural Experiment Station to form the Illinois Groundwater 
Consortium. From direct appropriations in the USDA budget for 8 years, 
the IGC awarded competitively selected grants to support collaborative 
and interdisciplinary research and outreach projects focused on 
scientific and policy issues relating to groundwater protection, fate 
and transport of agricultural chemicals, and the impacts of natural 
disasters (e.g., flooding) on surface- and ground-water, soils, and 
biodiversity. The members of the consortium have provided significant 
resources to the IGC from their own appropriations so that the state's 
contribution has approximately equaled the annual federal 
appropriations. It is expected that the match will continue.
    Throughout its history, the IGC has primarily funded research 
seeking answers to questions raised by public policy makers working on 
land use and water protection issues. Results of the work of the 
Consortium have impacts statewide. The members of the Illinois 
Groundwater Consortium are uniquely positioned to conduct 
investigations on issues of economic, ecological and political 
importance to all the people of Illinois.
Analyses of environmental restoration programs for the Illinois River
    Request: Illinois supports a fiscal year 2000 appropriation of 
$1,500,000 from the U.S. Department of Agriculture for analyses of 
environmental restoration programs for the Illinois River. The outyear 
appropriation request is $1,500,000 per year for 7 years.
    The Illinois River Conservation Reserve Program (CREP) is a $500 
million, 15-year joint federal and state initiative to restore the 
Illinois River watershed. The proposed appropriation will fund 
monitoring and scientific assessment of the land management benefits of 
CREP, leading to the development of sound land management strategies 
that will improve the efficiency of CREP and other future programs. 
These actions will jointly benefit agricultural production and water 
quality in Illinois, and promote the overall health of the Illinois 
River's ecosystem and the 11 million residents of its watershed. The 
benefits would be to demonstrate the effectiveness of a $500 million 
program. State matching funds: $158,700 (fiscal year 2000)
Agriculture research service USDA recordkeeping cooperative agreement
    Request: Support the fiscal year 1999 level of funding to promote 
$13 million to Illinois. The Illinois Department of Agriculture 
annually enters into a cooperative agreement with the U.S. Department 
of Agriculture's Agricultural Marketing Service (AMS) to monitor 
certified private pesticide applicator's restricted-use pesticide 
recordkeeping. The Food, Agriculture, Conservation, and Trade (FACT) 
Act of 1990, otherwise known as the 1990 Farm Bill, required the 
Secretary of Agriculture (USDA) to require certified private 
applicators to maintain records regarding the use of federally 
restricted use pesticides. Under the cooperative agreement, the 
Illinois Department of Agriculture annually conducts approximately 188 
randomly-selected applicator records checks to ensure compliance with 
these requirements.
Agriculture Research Service--Greenhouse Facility at University of 
        Illinois
    Request: Earmark $4.4 million for a Greenhouse Facility at Illinois 
University
    Funds will be used for the construction of a Greenhouse Facility at 
the Urbana-Champaign campus. The facility will operate in support of 
the Maize Genetics Stocks and National Soybean Germplasm collections 
maintained at the University. Federal investment in biotechnology 
research are important to the future of the food and agricultural 
sectors and consumers in Illinois.
                       other issues and programs
Tobacco Recoupment
    Request: Tobacco Agreement funds be distributed to the states 
without HCFA claiming a share and with no limitations on the use of the 
money.
    Illinois will receive approximately $9.1 billion over 25 years from 
the recent settlement with tobacco companies. Governor Ryan believes 
that all of the funds should be utilized pursuant to discussions among 
state and local elected public officials. To that end he supports 
measures to prohibit the Secretary of HHS from recouping a portion of 
the settlement and opposes any limitation placed on the use of the 
money by the federal government.
    The states accepted all of the risks and expense of this litigation 
and the federal government choose not to participate, despite a direct 
invitation to Attorney General Reno.
    Advocates for a federal share of these funds justify their claim on 
federal Medicaid payments. However, the settlement agreement does not 
mention Medicaid and many states did not employ the Medicaid expense 
argument as part of their cause of action. Generally, state causes of 
action were predicated on consumer protection, fraud, racketeering, 
antitrust violations and health related costs--only some of which are 
Medicaid.
    In addition, the legislative intent of the Medicaid law provides 
for recovery of overpayments to healthcare providers or to compensate 
for fraud and abuse, and not to provide a basis for any such federal 
claim.
    Requiring states to spend some of these funds on programs such as 
smoking cessation has been suggested. The settlement already requires 
the tobacco industry to fund a charitable trust in the amount of $2.5 
billion to conduct research about reducing smoking and creates a $1.45 
billion national public education fund for tobacco cessation efforts. 
In Additional the settlement has many provisions, which should reduce, 
smoking such as bans on advertising designed to appeal to you adults.
    The U.S. Senate-passed Supplemental includes the provisions desired 
by Illinois.
Low Income Housing Tax Credits (LIHTC)
    Request: Raise the allotted amount of LIHTC to $1.75 per capita 
from its current level of $1.25 per capita and index it for inflation.
    Illinois will gain $6 million in increased tax credits. The LIHTC 
program was established as part of the Tax Reform Act of 1986. Tax 
credits are awarded to developers of qualifying affordable housing 
projects who then sell the tax credit to private investors to raise 
equity for the development. The credit is used by the buyer as a 
reduction in their tax liability for a ten year period after the 
successful completion of the project. Over 90 percent of all affordable 
housing in the United States is funded by the LIHTC program, including 
30,000 units in Illinois alone. However, current demand for affordable 
housing for senior citizens and working families exceeds our tax credit 
resources by a 3 to 1 ratio. Since being codified, the per capita 
allotment has not been increased, and as a result of inflation, has 
lost approximately 45 percent of its original value.
                                 ______
                                 
 Prepared Statement of the Illinois-Missouri Alliance for Agricultural 
                             Biotechnology
    Mr. Chairman and distinguished members of the Senate Agriculture, 
Rural Development, and Related Agencies Subcommittee: Our testimony is 
on behalf of the federally-funded project entitled the Illinois-
Missouri Alliance for Agricultural Biotechnology (IMBA). A special 
grant of $1.3 million was provided to launch this effort in fiscal year 
1995. Additional grants of $1.3 million in fiscal year 1996 and fiscal 
year 1997, $1.2 million for fiscal year 1998, and $1.1 million for 
fiscal year 1999 were provided. An innovative management plan was 
developed, refined, approved by the Cooperative States Research, 
Education, and Extension Service (CSREES), and implemented. Updated 
plans have been submitted to CSREES each year and approved. Several 
important research and development projects are underway.
    Request: In order to sustain, expand, and enhance this productive 
and strategically essential program, we request that $3.0 million be 
appropriated for IMBA for fiscal year 2000. The increased appropriation 
will allow us to fund a larger proportion of the superb proposals being 
submitted to IMBA. It will allow us to implement fully the unique, IMBA 
performance-based management strategy, which addresses the major 
concerns of stakeholders concerning management of federal competitive 
grants programs. It will allow the program to go into continuous mode, 
as explained below, rather than annual cycles, and fully implement the 
``virtual'' research institute concept. An increased appropriation will 
provide significant economies of scale and scope, thus 
disproportionately increasing the funds directly available for 
research. In addition, it will increase the annual leveraged 
contributions from about $4 million to at least $9 million.
    Needs and opportunities: It is now evident that the Illinois 
Missouri Biotechnology Alliance is focused on the world's most 
important agricultural problem/opportunity. Rapidly growing population, 
urbanization, and affluence, especially in southeast Asia, are causing 
a dramatic increase in the consumption of animal protein. These factors 
are fostering unprecedented growth in large scale animal production 
facilities and in global markets for animal products.
    Corn and soybeans are superior economically, nutritionally, and for 
logistical reasons to other grain crops for feeding almost all classes 
of livestock, but especially swine, beef, dairy, poultry, and confined 
fish. These classes of livestock are undergoing the most rapid increase 
and inevitably will be produced in large scale, confinement facilities 
around the world. With superior technology, Illinois, Missouri, and 
surrounding corn belt states can be the principal suppliers not only of 
corn and soybeans but also of livestock products and other value-added 
products produced from corn and soybeans. To reap the potential 
benefits, however, the U. S. will have to compete vigorously against 
sophisticated producers, primarily in Latin America, for these emerging 
markets.
    Likewise, to keep the food situation from ravaging both 
agricultural and natural environments around the world, it is 
imperative that corn and soybean yield and quality, production 
efficiency, and efficiency of conversion into animal products and other 
high quality food and non-food products be increased at rates never 
achieved before. These are principal objectives of IMBA.
    Mission, objectives, and strategy: The mission of the IMBA is to 
increase the volume of profitable business in the U. S. food and 
agriculture sector by improving the diversity, quality, safety, 
affordability, and convenience of products and services marketed by the 
sector. The IMBA is accomplishing this mission by supporting cutting-
edge biotechnology research conducted as part of strategically sound, 
competitively funded, research and development projects organized 
around clearly defined, practical objectives.
    A steering committee made up of Roger Mitchell, Dean of the 
University of Missouri College of Agriculture, Food, and Natural 
Resources; Frank Stokes, Director of Policy and Planning, Monsanto 
Company; James McGuire, Dean of the Southern Illinois University 
College of Agriculture; and Don Holt, then Director of Research, 
University of Illinois College of Agriculture, prepared the original 
management plan for IMBA. The plan was implemented to create and 
coordinate a market-driven, mission-linked, practical-goal-focused 
research and development program characterized by public/private 
cooperation. The plan is aligned with the performance-based management 
philosophy of the Government Performance and Results Act (GPRA).
    When the management plan is approved each year, program funds are 
transferred to the Illinois Agricultural Experiment Station, which 
serves as repository until the funds are dispersed within the program. 
To avoid spreading the IMBA research investment too thinly, we limited 
the practical scope of the program to the corn and soybean industries; 
geographical scope to Illinois, Missouri, and other Midwestern states; 
and disciplinary scope to biotechnology.
    Day-to-day operations of IMBA are managed by a Program Manager, Dr. 
Bruce Bullock, Professor of Agricultural Economics, University of 
Missouri, and former Director of the Missouri Agricultural Experiment 
Station. The University of Illinois contracts with the University of 
Missouri-Columbia for Dr. Bullock's services. An Executive Committee is 
made up of Program Manager Bullock, new Missouri Dean Thomas Payne, 
Dean McGuire, new Illinois Associate Dean for Research Steven Pueppke, 
and Senior Associate Dean Holt, who serves as principal investigator on 
the project. The Executive Committee oversees the program and approves 
all major expenditures of IMBA funds.
    IMBA-funded biotechnology research grants are awarded 
competitively, based on relevance to IMBA objectives, soundness of the 
proposed research and development strategy, and scientific merit. 
Proposals are evaluated by both scientific peers and industry experts 
to assure that the best science and the best business strategies are 
brought to bear on agricultural problems and opportunities that are 
important to the region. The Program Manager works with the Executive 
Committee to design and develop a biotechnology research investment 
portfolio that addresses the following objectives.
    1. Develop new and improved uses for corn and soybeans and products 
that can be manufactured profitably from them.
    2. Increase the value of corn and soybeans as raw materials for 
manufacturing food, feed, fiber, fuel, and chemical feedstocks.
    3. Lower the unit cost of producing, processing, distributing, 
retailing, and utilizing corn, soybeans, and products manufactured from 
them.
    4. Maximize positive effects and minimize negative effects of the 
corn and soybean industries on the environment.
    5. Conserve non-renewable resources consumed in the corn and 
soybean industries.
    In designing the IMBA research portfolio, the Executive Committee 
defines and seeks an appropriate balance among the above objectives, 
among projects with varying degrees of uncertainty and risk, and among 
objectives that can be achieved in relatively short and long periods of 
time. On the high risk side, provision is made for some funding of 
promising but unproven scientists with good ideas.
    Innovative management: The IMBA Management Plan includes several 
innovations that differentiate IMBA from other major public 
agricultural research grant programs. IMBA proposals are solicited and 
projects organized around desired practical outcomes. Success is 
measured in terms of achieving practical objectives. Only biotechnology 
research projects that are fully integrated into strategically sound 
research and development projects are funded. Participating 
institutions, agencies, and private firms are expected to share project 
costs through direct and in-kind contributions. It appears that public 
and private direct and in-kind matching contributions will continue to 
exceed the IMBA investment by a factor of two or more.
    We intend to operate the program in continuous, parallel mode 
rather than in linear, stepwise sequences, repeated yearly. This 
approach should speed the R&D process while reducing cost. Information 
technology is being employed to bring an exceptional level of 
communication and coordination to each project. Each IMBA project 
involves public/private cooperation to achieve a useful practical 
outcome. The IMBA program manager is expected to take a more hands-on 
approach to research coordination than the usual grants manager.
    Achievements of IMBA research: IMBA-supported researchers 
accomplished the following during the past year: (1) refined 
genetically engineered baculovirus insecticides (produced in earlier 
IMBA work) by adding additional insect-specific toxins that increased 
virulence against corn borer and several other species of harmful 
insects. These viruses offer backup and alternatives to the bt 
approach; (2) developed and are patenting a unique genetic 
transformation process that increases lysine in corn proteins, thus 
markedly increasing corn protein quality. Two companies are seeking 
access to this technology; (3) produced gene constructs that should 
enable scientists and plant breeders to modify soybean oil quantity and 
quality at will so as to emulate desirable characteristics of competing 
oils, and, at the same time, studied market channels to see where it 
would be most profitable to market these modified soybeans and 
resulting products; (4) successfully transformed soybean plants, using 
the unique approach that will be used to introduce and target heat-
stable phytase genes discovered in earlier IMBA work. Successful 
introduction of phytase genes to crop plants and use of heat-stable 
phytase in processing will reduce the cost of phosphate supplementation 
of animal rations and greatly reduce the passage of plant phosphate 
through animals into water sources, where it is a major pollutant.
    In projects launched more recently, scientists accomplished the 
following; (1) through genetic transformation, produced corn hybrids 
with increased nitrogen use efficiency, 10 percent greater grain yield, 
and 10 percent greater biomass yield, measured in field experiments. As 
a side benefit, the GDH (glutamate dehydrogenase) gene incorporated 
into inbreds used to produce these superior plants was found to enhance 
considerably the so-called Liberty-Link herbicide resistance. The GDH 
gene promises to reduce the environmental impact of corn production by 
enabling the corn plant to thrive on the ammonium rather than the 
nitrate form of nitrogen. Garst and Monsanto tests of GDH-transformed 
corn were promising; (2) in a project to introduce a new mechanism of 
resistance to the most serious pest of soybeans, the cyst nematode, 
scientists isolated a gene that is being patented. The details are 
confidential at this point, but this gene plays an important role in 
plant development and may be manipulated to benefit U.S. agriculture.
    In addition, IMBA supported scientists: (3) developed the first 
databases of genes regulated by calorie level in foods; specific 
nutrients, such as lipids; and non-nutritive dietary chemicals, such as 
pytochemicals. With knowledge of these genes, it should be possible to 
identify each individual's unique food-related genetic profile, 
anticipate certain responses to food, and adjust eating habits 
accordingly. These tests will also facilitate treatment of various 
chronic and acute food-related disorders, including obesity, some forms 
of cancer, and heart disease. The food-related gene database will 
permit more accurate interpretation of toxological, drug, and disease 
gene expression experiments. Results of this work are being 
commercialized by a new firm, Electropharmacolocy, Inc., which has 
partnerships with major pharmaceutical and biotechnology companies.
    During the past year, an IMBA-funded group produced an online 
journal, AgBioForum, two issues of which are already on the web. The 
journal addresses important biotechnology issues such as mergers and 
acquisitions within the biotechnology industry and European resistance 
to genetically modified organisms. Response to this journal has far 
exceeded expectations. Over 20,000 people from all over the world 
accessed the journal and 600 became members of the journal association 
in the first four months it was on the web.
    The group that developed AgBioForum is also redesigning the IMBA 
web page to increase its utility an important mechanism of 
communication and coordination among biotechnologists. Besides 
providing IMBA background, project lists, and requests for proposals, 
the IMBA home page now contains over 100 ``hot links'' to the home 
pages of other biotechnology-related institutions, agencies, 
organizations, and firms. The IMBA home page will become the hub of a 
``virtual'' research institute focused on IMBA objectives.
    New projects underway include efforts to: (1) genetically engineer 
corn to produce genistein, one of a class of phytochemicals thought to 
prevent cancer and provide other health benefits; (2) develop an 
automated system for screening large numbers of seed samples and 
detecting and selecting superior resistance to soybean sudden death 
syndrome, thus saving years of field testing, (3) Isolate apomixis 
genes and transfer them to major crops, thus enabling ``permanent'' 
hybridization, in which the progeny of hybrids have the same genetic 
makeup as parents. This would make it practical to save corn produced 
on hybrid plants for seed; and (4) develop high oil, high oleic acid, 
value-added corn hybrids.
    Cooperators: Current cooperators in IMBA projects include the 
Universities of Illinois and Missouri, Southern Illinois University, 
Iowa State University, and the USDA-Agricultural Research Service group 
at Woodward, Oklahoma. Private, non-profit cooperators include 
Sapient's Institute and Northwestern University. Private sector 
commercial firms cooperating or involved in negotiations include 
Monsanto Company, Garst Seeds, Pioneer Hybrids, ADM-Growmark, Clarkson 
Grain, Cargill, Dupont, Biosys, Zeneca Agrochemicals, Novartis, 
DowElanco, GeneTech, Healthtech, and Electropharmacology, and others. 
Each phase 1 project is generating potential new and improved projects. 
Private firms are evaluating the commercial potential of each product 
of IMBA research, and, in some cases, gearing up to produce these 
products.
    Summary: We believe IMBA projects constitute an outstanding 
portfolio of promising research investments focused on the major 
problems and opportunities associated with the U.S. corn and soybean 
industries and the world food situation. Because of the economically 
important subject matter being addressed by the Illinois-Missouri 
Biotechnology Alliance, the unique capabilities of participating 
institutions, and the innovative research management approach being 
employed, we believe the project will continue to be unusually 
productive and will generate an unusually high return on the federal 
investment. This will be more than justify the $6.2 million 
appropriated to date and the $3.0 million requested to continue the 
project in fiscal year 2000.
                                 ______
                                 
    Prepared Statement of the International Association of Fish and 
                           Wildlife Agencies
              natural resource conservation service (nrcs)
    The Natural Resource Conservation Service has immense 
responsibilities for implementing the conservation provisions of the 
1985 Food Security Act (FSA), the 1990 Food, Agriculture, Conservation 
and Trade (FACT) Act, and the Federal Agricultural Improvement and 
Reform (FAIR) Act of 1996.
    Technical Assistance.--The USDA publication ``Geography of Hope'' 
identifies that the need for general conservation technical assistance 
for America's private landowner will continue to increase to 2002 and 
beyond. Additionally, a fiscal year 1999 workload analysis indicated 
the need for an additional $300 million for technical assistance. The 
Association supports the $31 million requested increase in conservation 
operations but is extremely concerned about the substitution of new 
initiatives without adequate present funding levels to meet existing 
needs. The Association is further strongly concerned about the decrease 
of 1,055 field level staff when all indicators point to the need for 
more field level staff to provide technical assistance required for 
existing programs as well as the Administration's proposed new 
initiatives.
    In addition to increasing general (non-programmatic) technical 
assistance, increased technical assistance funds are needed to 
implement increasingly popular provisions of the 1996 FAIR Act. The 
budget for the Wetlands Reserve Program (WRP), Wildlife Habitat 
Incentives Program (WHIP), and the Farmland Protection Program (FPP) 
all include the customary 19 percent to 20 percent for technical 
assistance. The Association strongly supports this level of funding 
provided to ensure that optimum agriculture and natural resource 
benefits will accrue from these programs. Notably absent from the list 
of programs provided adequate levels of technical assistance is the 
Environmental Quality Incentives Program (EQIP). The proposed fiscal 
year 2000 budget raises EQIP from $200 million to $300 million, which 
the Association applauds. It is not clear, however, that additional 
funds are available to provide the required technical assistance to a 
field level program with a 50 percent increase. Some Programs (CRP, 
WRP, CFO and FPP) have a technical assistance cap set by Section 11 of 
the CCC Charter Act at the 1995 spending level. No such constraint 
exists on EQIP. The Association therefore strongly urges the 
restoration of the customary 19 percent for technical assistance on 
EQIP.
    State Technical Committees (STC).--The 1990 FACT Act required that 
State Technical Committees (STC) be established to facilitate 
interagency cooperation and coordination of technical guidelines for 
the conservation programs. Further, the USDA 1995 Reorganization Act 
specifically exempted the STC from the Federal Advisory Committee Act 
(FACA). The 1996 FAIR Act further added additional members to the STC. 
Federal-State coordination is an ongoing normal function that is 
required with or without a formal State Technical Committee. We commend 
the strong efforts of NRCS that has ensured the establishment of the 
State Technical Committees in each State with representation from the 
respective State fish and wildlife agency.
    Wetland Determination.--We believe the need for wetland 
determination, certification, and mapping is great and urge NRCS to 
proceed as soon as possible, under the guidance of the FAIR Act of 
1996. The Association urges expeditious completion of the wetland 
determinations required to implement the Swampbuster provisions of the 
1985 FSA, 1990 FACT Act, and the 1996 FAIR Act as well as the FAIR Act 
directed interagency cooperation, whereby NRCS assumed responsibility 
for wetland designation for Section 404 (Clean Water Act) purposes on 
farmland, including tree farms, rangelands, native pasture, and other 
private lands used to produce or support the production of livestock. 
The Association and individual states wish to continue to work with 
NRCS to help achieve these goals.
    Public Law 566.--The Association generally supports the small 
watershed (Public Law 566) Projects. That support is based upon 
continued emphasis on updated watershed planning and management. Such 
efforts could utilize and expand upon existing Public Law 566 plans 
examined in light of present day issues of wetland protection, water 
quality enhancement and fish and wildlife habitat. The greatest 
potential for these programs is for land treatment measures that retain 
the water on the land, improve infiltration, improve water quantity and 
quality, and provide fish and wildlife habitat. Structural and non-
structural land treatment activities require state and local matching 
funds and are therefore leveraged to provide greater conservation 
benefits for each federal dollar spent while promoting valuable 
partnerships among states, local agencies, and other organizations.
    National Buffer Initiative.--NRCS has implemented the initiative in 
cooperation with industry and other partners. The Association is 
pleased to be a sponsor of this innovative approach. The National 
Academy of Sciences has found that buffer strips can reduce off-field 
pollution by 70 percent, thus also contributing to meeting non-point 
source remediation goals under the Clean Water Act. Unfortunately, the 
level of sign-up by producers remains very low. NRCS has committed 
special emphasis and a major effort to use the strip practices covered 
by the continuous CRP sign-up in a more targeted fashion. Unlike the 
large or whole field CRP retirements, buffer strips will require 
extensive outreach plus the much more attractive rental rate now 
available. The Association supports the allocation of increased funds 
specifically for outreach to increase participation in the various 
buffer strip practices. In addition, a review and evaluation of why 
sign-up is low is strongly recommended. Increased activity on the 
Buffer Initiative (continuous CRP sign-up) will require an increase in 
field staff for technical assistance rather than a decrease as 
proposed.
    Forest Incentive Program (FIP).--The Forest Incentive Programs 
(FIP) has multiple resource values for fish, forests, wildlife, clean 
water and erosion control. The Association opposes the NRCS proposed 
intention to drop FIP funding and strongly recommends that the fiscal 
year 1999 level of $16.325 million be continued in the fiscal year 2000 
budget.
    Capped Programs.--The Wetlands Reserve Program (WRP), Wildlife 
Habitat Incentives Program (WHIP), and the Farmland Protection Program 
(FPP) have all reached or are near authorized acreage or appropriation 
caps. The Association continues to recognize and support the benefits 
to our natural resources from these programs. We believe that due to 
the overwhelming success, customer acceptance and public benefits of 
these programs, they should be re-authorized. We applaud the NRCS 
proposal to continue the WHIP at $10 million annually through 2002 with 
legislation removing the appropriations can. The Association likewise 
applauds the proposal to budget $27.5 million for continuation of the 
Farmland Protection Program. The Association strongly suggests that 
similar efforts be made to remove the 975,000 acre can on WRP before 
that cap is reached in fiscal year 2000.
    Program Delivery.--Continued erosion of field staff with the 
additional staff reduction proposal in fiscal year 2000 is inconsistent 
with the needs demonstrated by the recent workload analysis. That 
analysis determined the need for $300 million for additional field 
staff for implementation of existing programs. The addition of new 
initiatives (worthy as they are) simply exacerbates the shortage of 
sufficient field staff providing technical assistance.
    The Association is very strongly concerned about this continued 
erosion of technical staff and equally strongly recommends the addition 
of $300 million in fiscal year 2000 to help meet this critical need for 
technical assistance for effective program delivery of these vital 
conservation programs.
                       farm service agency (fsa)
    An adequately funded budget for the FSA is essential to implement 
those conservation related programs and provisions under FSA 
administration and/or in cooperation with NRCS as a result of passage 
of the Federal Agricultural Improvement and Reform (FAIR) Act of 1996. 
The Association strongly advocates that the budget include sufficient 
personnel funding to service a very active program and strongly 
believes that the continued erosion of personnel with the additional 
proposed reduction of 752 employees is inconsistent with program needs.
    FSA programs have tremendous quantifiable impacts on natural 
resources, and yield substantial public as well as private benefits. 
Building on the Provisions of the 1985 FSA the 1990 FACT Act, and the 
1996 FAIR Act, the Association wants to ensure that each program 
accomplishes the broadest Possible range of natural resource 
objectives, and encourages close cooperation between FSA. NRCS and the 
State Technical Committees in implementing the 1996 FAIR Act.
    Flood Risk Reduction Program.--We believe this program has great 
potential to mesh with the Army Corp of Engineers Rivers Ecosystem 
Restoration and Flood Hazard Mitigation Project which is a part of the 
President's Clean Water Initiative. We urge FSA to prepare regulations 
and budget for implementation and make every effort to ensure that 
language used in its easements and agreements provide a streamlined 
basis for appropriate administration and are user-friendly. The 
Association is disappointed that no budget is requested and urges that 
a start-up budget be initiated to assist in the President's Clean Water 
initiative.
    Conservation Reserve Program.--The continued administration of CRP 
under the guidelines of the 1996 FAIR Act is a very significant and 
valuable commitment of USDA and the FSA. The Association applauds FSA 
efforts to fund and extend CRP contracts for the multiple benefits that 
accrue to the public as well as the landowner. The Association is 
especially pleased to note the commitment to reach as soon as practical 
and maintain the authorized 36 million acres in CRP. The Association 
provides special thanks to FSA for the continuous CRP sign-up of high 
value environmental practices and urges a special effort to advertise 
and increase landowner participation.
    The commitment of FSA to provide high wildlife benefits in CRP 
contracts was most obvious in the 15th and 16th sign-up. The 
Association applauds FSA in those efforts with their special emphasis 
on native grass species and enlightened pine planting and management 
strategies for maximum wildlife benefits.
  wildlife services/animal and plant health inspection service (aphis)
    The President's fiscal year 2000 proposed budget for the APHIS 
Wildlife Services Operations is $28.15 million and reflects a $1.845 
million decrease from the fiscal year 1999 level. For Methods 
Development, the proposed budget is $9.59 million, a $776,000 reduction 
from the fiscal year 1999 level. Additionally, if $655,000 in pay costs 
is not appropriated for Operations and $194,000 for Methods 
Development, this will amount to a further reduction for the program 
from the fiscal year 1999 enacted level. The Association continues to 
be strongly concerned about the steady erosion of funding in the 
President's budget request for Wildlife Services.
    Wildlife Services (WS), a unit of APHIS, is the Federal agency 
responsible for controlling wildlife damage to agriculture, 
aquaculture, forest, range and other natural resources; for protecting 
public health and safety through the control of wildlife-bone diseases; 
and wildlife control at airports. Its control activities are based on 
the principles of wildlife management and integrated damage management 
and are carried out cooperatively with State fish and wildlife 
agencies. Most APHIS-WS operational work is cost shared between the 
Federal WS program, State and county governments, agricultural 
producers, and other cooperators.
    The cooperation and support of the public and the agricultural 
community are essential to maintaining wildlife populations because 
much of the Nation's wildlife exists on private agricultural lands. A 
progressive wildlife damage management program which reduces the 
adverse impact of wildlife populations is necessary to maintain the 
support of the agrarian community and to counter increasing pressures 
for indemnity due to wildlife damage.
    Since Congress transferred the WS program to USDA in 1986, the 
Association has worked closely with this program on numerous issues 
critical to the State fish and wildlife agencies. The Association 
commends the WS program for its continuing effort to be attuned to the 
changing public values related to the Nation's wildlife, while 
remaining responsive to emerging wildlife problems.
    The Association is concerned with the Administration's proposed 
reduction in both the WS Operations and Methods Development programs 
for fiscal year 2000. Many wildlife populations such as mammalian 
predators (e.g., coyotes) and mid-sized carnivores (e.g., raccoons), 
some species of waterfowl (e.g., resident Canada geese, snow geese), 
fish-eating birds (e.g., double-crested cormorants), white-tailed deer, 
and beavers are at all-time highs. Human/wildlife conflicts and 
requests for assistance are also at record numbers. The Association 
strongly requests the WS appropriation be restored to at least the 
fiscal year 1999 level to adequately address these increasing wildlife 
overabundance problems.
    The fiscal year 2000 budget also contains $875,000 in unfunded 
Congressional directives regarding wolf control in the northern Rocky 
Mountains and brown tree snake control efforts and the establishment of 
a State office in Hawaii. The Association agrees that these are 
priority issues and recommends that $875,000 for these directives be 
Provided to WS to conduct these activities.
    The wolf population in the upper Midwest is growing at a rapid 
rate. Wolves have increased their range into new areas in Minnesota, as 
well as Wisconsin and Michigan. The Association recognizes the impacts 
of wolf recovery on the WS program both from the standpoint of the 
workload increase from escalating complaints regarding predation, and 
the reduction in WS' ability to provide damage protection to the 
livestock industry from other predators in the wolf recovery area 
because of restrictions on management tools. The Association supports 
increase of $100,000 to adequately address wolf depredations in 
Minnesota, Wisconsin, and Michigan. The Association further supports an 
increase of $150,000 to address livestock/wolf conflicts attributable 
to wolf reintroduction in the intermountain west, and establishment of 
a wolf/grizzly conflict resolution position in Wyoming.
    We commend Congress for recognizing the need for wildlife damage 
research when they appropriated funds to begin construction several 
years ago on what has become the National Wildlife Research Center 
located in Ft. Collins, Colorado. This state-of-the-art facility is the 
only one of its kind in the entire world devoted exclusively to the 
identification and development of effective wildlife damage control 
methods. The WS research facility places a significant emphasis on non-
lethal methods development. The Association supports the effort to 
develop more socially acceptable wildlife damage management methods and 
recommends an increase of $800,000 to the WS program to effectively 
address this area.
    The Association strongly supports the request for $450,000 in 
fiscal year 2000 to continue the trap testing begun in fiscal year 1999 
to support the U.S. agreement with the European Union. These funds are 
critical to fulfilling the agreement to identify and develop the most 
humane possible traps practicable for taking furbearing animals. As 
many of these species are overabundant relative to historic conditions 
(e.g., coyotes, raccoons), this effort is supportive of important 
wildlife management as well as economic and trade issues.
    The Association recognizes the importance of aircraft to WS for 
both predator control and the distribution of oral vaccine baits for 
rabies control projects and we commend Congress for providing $1.2 
million in fiscal year 1999 to WS to begin implementing improved safety 
procedures for their aerial operations. However, no funding was 
proposed in the fiscal year 2000 budget to continue this effort, and 
the Association recommends that a similar (to fiscal year 1999) amount 
of funding be provided to address this critical area of the program.
    The Association supports the increased emphasis on aircraft/
wildlife hazards, but opposes the redirection of funds from other 
critical needs toward this problem. Therefore, the Association instead 
recommends the addition of $1.2 million to WS' budget to address this 
important problem.
    The Association is concerned with recent attempts by various 
organizations and individuals in the past several years to 
significantly reduce WS' funding for predator control activities in the 
western United States. The Association opposes attempts to reduce the 
WS budget through broad scale or across-the-board funding cuts. Instead 
the Association encourages WS to continue cooperation through 
coordinated predator management agreements with western state partners 
in order to ensure funding and management activities are directed 
towards the most effective and beneficial predator management 
strategies.
    The Association is pleased with the accomplishments of the Berryman 
Institute at the Utah State University in Logan, Utah. However, we 
would like to see the Institute enhance its capabilities to conduct 
social science research, expand continuing education programs, and 
start a new high quality scientific journal for wildlife damage 
management that would be patterned after other established journals. To 
reach these new Goals. the Association supports an increase of the 
funding to the Berryman Institute by an additional $300,000.
cooperative state research, education, and extension service (csrees), 
                     u.s. department of agriculture
    The Association recognizes that the research and educational 
programs of the CSREES and its Land Grant Partners effect relevant, 
positive changes in attitudes and implementation of new technologies by 
private landowners, managers, community decision-makers, and the 
public. This results in significant benefits to individuals and to the 
Nation through building and sustaining a more viable and productive 
natural resource base and a competitive and profitable agriculture. 
Since over two-thirds of our lands, approximately 1.35 billion acres, 
are controlled by over 10 million private landowners and managers, it 
is most appropriate that the CSREES-Land Grant System, with its grass 
roots credibility and delivery system, be adequately funded to 
translate and deliver research-based educational programs and new 
technologies to help the Nation's private landowners and managers move 
towards a more sustainable society. However, in the President's fiscal 
year 2000 budget, we see virtually no emphasis on natural resources 
research and education directed toward helping these clientele. In 
fact, the total number of farmers based on recent statistics is just 
slightly over one million, yet the great majority of CSREES' budget is 
devoted to production agriculture with only $3.192 million budgeted for 
the Renewable Resources Extension Act to assist the over ten million 
private landowners and managers who own and manage most of the nation's 
natural resource base. This amount is infinitesimal in the total CSREES 
proposed fiscal year 2000 budget of $948.01 million.
    The Association recommends that the fiscal year 2000 appropriation 
for CSREES should redirect funding to accomplish the following goals:
    IAFWA recommends that the Renewable Resources Extension Act be 
funded at a minimum level of $12.0 million in fiscal year 2000. The 
RREA funds, which are apportioned to State Extension Services, 
effectively leverage cooperating partnerships at an average of about 
four to one, with a focus on the development and dissemination of 
useful and practical educational programs to private landowners (rural 
and urban) and continuing education of professionals. The increase to 
$12.0 million would enable the Extension System to accomplish the goals 
and objectives outlined in the 1991-1995 Report to Congress. The need 
for RREA educational programs is greater today than ever because of the 
fragmentation of ownerships, the diversity of landowners needing 
assistance, and the increasing environmental concerns of society about 
land use. It is important to note that RREA has been reauthorized 
through 2002. It was originally authorized at $15 million annually; 
however, even though it has been proven to be effective in leveraging 
cooperative state and local funding, it has never been funded at a 
level beyond $3.4 million. An increase to $12.0 million would enable 
the Extension Service to expand its capability to assist over 500,000 
private landowners annually to improve decision-making and management 
on an additional 35 million acres while increasing productivity and 
revenue by $200 million.
    IAFWA recommends that Smith-Lever 3(b)&(c) base program funding be 
increased by 9.0 percent to a level of $280.95 million with an 
appropriate portion of this increase targeted to Extension's Natural 
Resource and Environmental Management Programs (NREM). The President's 
fiscal year 2000 budget requests a reduction of $18,795,000 funding for 
Smith-Lever 3(b)&(c) funds from the fiscal year 1999 level. IAFWA 
appreciates that Smith-Lever 3(b)&(c) base programs provide ``Block 
Grant'' type funds for land grant universities to provide essential 
educational outreach based on local needs assessment. This will enable 
NREM programs to develop the critical mass of expertise at the state 
and local levels to redirect and leverage limited funding to address 
critical existing and emerging natural resource and environmental 
issues that are directly affecting small landowners and farmers in both 
rural and urban communities nationwide. Expanding Extension programs in 
natural resource public issues education on such issues as forest 
health, wetlands, endangered species, and human/wildlife interactions, 
as well as to strengthen its programs in urban and community forestry 
and environmental education, as called for in the 1990 FACT Act, is 
essential to address natural resource issues that are relevant to the 
sustainability of these critical resources. Such an increase targeted 
appropriately would help producers better understand and implement the 
changes in the 1996 Farm Bill Conservation Provisions. Moreover, we are 
concerned that appropriate positions in the Natural Resources and 
Environment Unit have not been retained to provide needed national 
leadership for critical interdisciplinary resources such as range 
management.
    IAFWA encourages continuation of close cooperation between State 
CES's and their State Fish and Wildlife agencies, as well as other 
appropriate state and federal agencies and conservation organizations. 
Extension 4-H Youth natural resource programs and projects continue to 
increase with over 1,350,000 youngsters presently enrolled from both 
urban and rural communities across the Nation. Increased Smith-Lever 
funds targeted appropriately will enable CSREES to carry out its 
environmental education and NREM National Strategic Plan obligations 
nationwide.
    IAFWA recommends restoration of the Rangeland Research Grants 
$500,000 budget for fiscal year 2000. The Association is disappointed 
that the practical and applied problems addressed by the Rangeland 
Research Grants (RRG) program were zeroed out in the President's 1998 
budget, and totally ignored in the fiscal year 1999 budget and in the 
fiscal year 2000 budget. Over one half of the land area of the United 
States is rangeland; and elimination of the only federal competitive 
grants program for rangelands has serious implications for wildlife, 
watersheds, and other natural resources. Modest appropriations for RRG 
in the past have supported some of the most important rangeland 
research conducted over the past decade, and wildlife issues on 
rangelands will present some of the more critical rangeland research 
problems over the next decade. This would help increase the 
interdisciplinary capacity of research and educational programs to help 
landowners improve the adoption of forests and rangelands habitat 
conservation and management recommendations.
    IAFWA recommends that an appropriate portion of the total increased 
appropriation for Pest Management should be dedicated to educational 
programs for prevention and control of vertebrate pests in urban and 
rural communities and to address invasive exotic species and noxious 
weed problems on rangelands for restoring, managing, and sustaining the 
biological integrity of the Nation's natural resource base upon which 
the agricultural and natural resource economies depend. IAFWA notes 
that a combined total increase of almost $15.5 million has been 
recommended in the President's budget for Pest Management and related 
research and extension programs over and above increases received in 
fiscal year 1999 and that a significant increase in plant and animal 
research in the National Research Initiative of $48 million is 
included, with no opportunity for addressing vertebrate pests. Yet, 
vertebrate pests and invasive species have been identified in many 
states as posing the most significant problems, now and in the future, 
that agricultural and related crop producers and private landowners 
face. The targeting of Pest Management funds for research and 
educational programs to reduce significant losses to vertebrate pests 
and invasive species would effectively advance the knowledge and 
capability of landowners and managers to significantly reduce their 
losses caused by vertebrate pests and invasive species. It would also 
enable CSREES and its land grant partners to better address the 
recently announced Executive Order on Invasive Species (1999-02-03).
    IAFWA recommends that the Hatch and McIntire-Stennis funds be 
restored to fiscal year 1999 levels and, if necessary, redirected from 
the substantial $80.7 million proposed increase in NRI funding. IAFWA 
is pleased that the Administration proposes a $11.5 million increase in 
basic research identified under the National Research Initiative (NRI) 
as Natural Resources and the Environment; however, what is proposed in 
the current version of the President's Budget does not address natural 
resource issues and clearly does not address critical natural resource 
research needs that the Natural Resource Community, the public, and the 
over 10 million private landowners are vitally concerned about. The 
Association is alarmed at the significant reduction in both the Hatch 
Act and McIntire-Stennis research programs of $28.92 million. Both of 
these research programs, conducted by land grant university partners 
and other educational institutions, are crucial to addressing natural 
resource and environmental issues critical to agriculture and natural 
resource sustainability now and in the future. The Association is 
extremely disappointed in the Goal 4 Greater Harmony between 
Agriculture and the Environments which is the only one of the six 
CSREES Strategic Goals that even purports to address natural resources. 
There is no mention of research or extension programs to address the 
erosion of the nation's natural resource base except that alluded to by 
the Integrated Research and Extension Water Quality Program. The others 
are totally focused on agriculture. The nation's agricultural base 
cannot be sustained if its natural resource base is not sustained.
                                 ______
                                 
           Letter From the Iowa Senate Agriculture Committee
                                        The Senate,
                                             State of Iowa,
                                  Des Moines, Iowa, April 21, 1999.
The Honorable Thad Cochran,
Chair, U.S. Senate Appropriations Agriculture Subcommittee, SD-136, 
        U.S. Senate, Washington, D.C.
    Dear Senator Cochran: I am submitting this letter as an indication 
that the Food and Agricultural Policy Research Institute (FAPRI) 
Consortium provides significant analysis and data to state policy 
makers. As Chairman of the Iowa Senate Agriculture Committee, I have 
relied on the information and data provided by FAPRI in our 
deliberations dealing with policy questions on agriculture and trade 
policy. With events such as the Asian economic difficulties, continuing 
developments within the European Union, the currency problems in the 
Southern Hemisphere, and other events throughout the world it becomes 
essential to have a reliable source of unbiased information and data.
    The baseline and other large-scale econometric models developed and 
maintained by FAPRI have provided analyses enabling us to more 
accurately project our budgets and determine appropriate policy courses 
for this state's agriculture, as well as to determine our role in 
national policies. Additionally, FAPRI forecasts enable agricultural 
producers and policy makers to form and assess their outlook of 
national and world markets.
    Certainly at this time of concern and difficulty in the farm 
economy, this type of data and intelligence is extremely valuable to 
all policy makers at the local, state, and national level. I would hope 
that this type of support would continue in the future.
            Sincerely yours,
                                        E. Thurman Gaskill,
                     Chairman of Iowa Senate Agriculture Committee.
                                 ______
                                 

            Prepared Statement of the Joslin Diabetes Center

                              introduction
    Mr. Chairman, thank you for this opportunity to submit a statement 
for the public witness hearing record. The subject of this short 
statement is the continued funding in fiscal year 2000 for the Diabetes 
Project in the Extension Service of CREES. We have developed a plan for 
fiscal year 2000 that will require $975,000. This includes costs of 
Federal Administration, participation expenses of the states of 
Washington and Hawaii and the personnel, equipment and associated costs 
of Joslin Diabetes Center within the total cost of the program.
                      fiscal year 1999 background
    I would like to express Joslin Diabetes Center's sincere 
appreciation to you and Representative Nethercutt for your leadership 
in the fiscal year 1999 process in providing $550,000 for the initial 
year of the Diabetes Project. We know you faced difficult decisions 
concerning funding priorities. We feel that your allocation of these 
funds indicates that you share the vision of the growing community role 
and organizational flexibility of the Extension Service as we enter the 
21st Century.
    Joslin and Extension personnel have met and agreed to a plan of 
action in implementing the fiscal year 1999 program. Extension Service 
officials characterized the concept as a ``win-win'' program during the 
first meeting. When initial meetings were held, Extension Service 
officials immediately embraced the concept of utilizing components of 
Extension's national partnership infrastructure for a pilot program 
with Joslin. In fact, Extension was already involved at the state level 
with the National Diabetes Education Program (NDEP), a joint program of 
the Centers for Disease Control (CDC) and the National Institutes of 
Health (NIH), both part of the Department of Health and Human Services. 
Extension officials recognized that Joslin's non-invasive screening 
proposal, based on components of the Joslin Vision Network (JVN) 
brought an important new facet to the NDEP and services to the rural 
health population. The addition of the Joslin pilot program is of 
particular importance in providing this new technology to minority 
rural residents, who suffer a much higher incidence rate than is the 
national average.
    To date, we have been in contact with the State officials of 
Washington and Hawaii, and have had several visits and conference call 
sessions with Federal Extension officials. We are at the point of 
signing a Memorandum of Understanding with the Federal Extension 
component to launch the full-scale program. We have submitted a plan of 
action and are incorporating some alterations suggested by both State 
and Washington personnel. Once the revised plan is completed and 
approved by Extension, we will deploy the equipment and materials that 
both Joslin and Extension have been preparing during this period of 
partnership formalization.
    Joslin is eager to commence the program. By the time this hearing 
volume is published, the program will be underway and operating within 
both Washington and Hawaii.
                         fiscal year 2000 plan
    For fiscal year 2000, the mission and objectives for the two state 
pilot program remain the same as for fiscal year 1999. For any project 
to prove its benefit, at least two years of operational experience must 
be conducted in order to gather sufficient data to prove the project's 
value. The Diabetes Project will be fully operational October 1, 1999, 
the first day of fiscal year 2000. In fiscal year 1999, much of the 
first six months was devoted to establishing organizational 
responsibilities, developing proposals in the standard CREES/Extension 
forms, and coordinating the implementation mechanism necessary to 
deliver services to the target populations of Washington and Hawaii.
    As with first year funding, the following will be accomplished in 
the second year (fiscal year 2000):
  --training of Washington and Hawaii Extension personnel in equipment 
        use will have taken place;
  --deployment of the diabetes non invasive screening portion of the 
        project will be completed;
  --educational materials will have been devised for the specific 
        target populations of Washington and Hawaii;
  --coordination with the NDEP, local and State health officials to 
        handle referrals will have been established;
  --preliminary baseline comparisons will have been completed for the 
        first year's operational phase; and
  --plans to monitor third year independent operation will have been 
        established.
    The evaluation of the two year performance, compared with baseline 
data, will yield the results of the introduction of the advanced 
technology and the advanced medical care and prevention techniques that 
are the subject of this project. When similar testimony is provided to 
the Committee next year, we hope to have preliminary findings to report 
to you on this investment in American rural health and the cooperative 
partnership between the Extension Service and the Joslin Diabetes 
Center.
    Mr. Chairman, this concludes my brief statement. we are submitting 
a detailed budget for the fiscal year 2000 funds of $975,000 we are 
seeking to the Extension Service for their review. If you or the 
Committee staff have any questions we may answer concerning this 
project, we would be pleased to meet and discuss the details in more 
detail.
    Mr. Chairman, thank you again for your efforts in fiscal year 1999. 
The Extension Service and Joslin Diabetes Center appreciate your 
confidence in our capabilities and your focus on the improvement of 
quality life in rural America. We respectfully request continued 
funding of $975,000 in fiscal year 2000 to fully demonstrate the 
benefits and potential national returns that can be derived from this 
pilot effort.
                                 ______
                                 
   Prepared Statement of the Metropolitan Water District of Southern 
                               California
    Chairman Cochran and members of the subcommittee: The Metropolitan 
Water District of Southern California (MWD) appreciates the opportunity 
to submit testimony regarding the U.S. Department of Agriculture's 
(USDA) fiscal year 2000 budget, for the Hearing on Agriculture, Rural 
Development, Food and Drug Administration and Related Agencies 
Appropriations. MWD is a public agency created in 1928 to meet 
supplemental water demands of those people living in what is now 
portions of a six-county region of southern California. Today, the 
region served by MWD includes nearly 16 million people living on the 
coastal plain between Ventura and the international boundary with 
Mexican border. It is an area larger than the State of Connecticut and, 
if it were a separate nation, would rank in the top ten economies of 
the world.
    Included in our region are more than 225 cities and unincorporated 
areas in the counties of Los Angeles, Orange, San Diego, Riverside, San 
Bernardino, and Ventura. We provide more than half the water consumed 
in our 5,200-square-mile service area. MWD's water supplies come from 
the Colorado River via the district's Colorado River Aqueduct and from 
northern California via the State Water Project's California Aqueduct.
Introduction
    MWD continues to favor USDA implementation of conservation 
programs, and is especially encouraged by the new actions identified in 
the recently released Clean Water Action Plan. The Clean Water Action 
Plan fosters integration of efforts by USDA, the U.S. Environmental 
Protection Agency, and other federal agencies to improve water quality. 
MWD firmly believes that inter-agency coordination along with 
cooperative conservation programs, that are incentive-based and 
facilitate the development of partnerships are critical to addressing 
natural resources concerns, such as water quality degradation, wetlands 
loss and wildlife habitat destruction. It is vital that Congress 
provide USDA with the funding necessary to successfully carry out its 
commitment to natural resources conservation.
    Our testimony focuses on USDA's conservation programs that are of 
major importance to MWD. In particular, MWD urges your full support for 
funding for USDA's Environmental Quality Incentives Program (EQIP). 
Full funding for this program is essential for achieving Colorado River 
Basin salinity control objectives through the implementation of 
salinity control measures as part of EQIP. In addition, MWD requests 
your full support for the Wildlife Habitat Incentives Program, 
Conservation Reserve Program, Wetlands Reserve Program, Integrated Pest 
Management and related programs, and the Water and Waste Disposal Loans 
and Grants program. Sufficient federal funding for these USDA programs 
is necessary to achieve wildlife habitat restoration and source water 
quality protection objectives in the Colorado River Basin and in 
California's Sacramento/San Joaquin Bay-Delta (Bay-Delta) estuary.
Environmental Quality Incentives Program
    The Environmental Quality Incentives Program provides cost-sharing 
and incentive payments, technical assistance and educational assistance 
to farmers and ranchers for the implementation of structural practices 
(e.g., animal waste management facilities, filterstrips) and land 
management practices (e.g., nutrient management, grazing management) 
that address the most serious threats to soil, water and related 
natural resources. EQIP is to be carried out in a manner that maximizes 
environmental benefits per dollar expended. This assistance is focused 
in conservation priority areas identified by the Natural Resources 
Conservation Service's State Conservationists, in conjunction with 
state technical committees and Farm Service Agency personnel. MWD does 
have some concern with respect to this aspect of EQIP. Beginning with 
the first full year of EQIP funding in 1997, USDA's participation in 
the Colorado River Salinity Control Program has significantly 
diminished. The mechanism by which funding has been allocated by USDA 
to date inherently overlooks projects for which benefits are interstate 
and international in nature. Clearly, Colorado River salinity control 
has benefits that are not merely local in nature, but continue 
downstream and EQIP as it is currently administered by USDA does not 
adequately fund national priorities. MWD supports the recommendation of 
the Colorado River Basin Salinity Control Forum as a way to remedy this 
situation. In Public Law 104-127, Congress amended the Colorado River 
Basin Salinity Control Act to direct the Secretary of Agriculture to 
carry out salinity control measures in the Colorado River Basin as part 
of EQIP. Sufficient federal funding for implementation of EQIP is 
critical in order to achieve Colorado River Basin salinity control 
objectives as well as source water quality protection and ecosystem 
restoration objectives in the Bay-Delta estuary and watersheds 
tributary to the Bay-Delta.
    The Colorado River Basin Salinity Control Forum (Forum), the 
interstate organization responsible for coordinating the Basin states' 
salinity control efforts, issued its 1996 Review, Water Quality 
Standards for Salinity, Colorado River System (1996 Review) in June of 
1996. The 1996 Review found that additional salinity control was 
necessary with normal water supply conditions beginning in 1994 to meet 
the numeric criteria in the water quality standards adopted by the 
seven Colorado River Basin states and the U.S. Environmental Protection 
Agency. For the last six years (1994-99), funding for USDA's salinity 
control program has not equaled the Forum-identified funding need for 
the portion of the program the Federal Government has the 
responsibility to implement. It is essential that implementation of 
Colorado River Basin salinity control efforts through EQIP be 
accelerated to permit the numeric criteria to be met again under 
average annual long-term water supply conditions, making up the 
shortfall. The Basin states and farmers stand ready to pay their share 
of the implementation costs of EQIP.
    The President's proposed fiscal year 2000 budget contains program 
funding of $300 million for implementation of EQIP through financing 
provided by the Commodity Credit Corporation. MWD supports this level 
of EQIP funding which is also consistent with the USDA actions called 
for under the Clean Water Action Plan. MWD also support the proposed 
level of funding for Conservation Technical Assistance included within 
the Natural Resources Conservation Service's (NRCS) Conservation 
Operations Program. Conservation technical assistance provides the 
foundation for implementation of EQIP and other conservation programs. 
The Forum has determined that allocation of $12 million in EQIP funds 
in fiscal year 2000 is needed for on-farm measures to control Colorado 
River salinity. This level of funding is necessary to meet the salinity 
control activities schedule to maintain the state adopted and federally 
approved water quality standards.
    MWD also supports the proposed level of funding for Conservation 
Technical Assistance (CTA) included within the Natural Resources 
Conservation Service's (NRCS) Conservation Operations Program. 
Conservation technical assistance provides the foundation for 
implementation of EQIP and other conservation programs. The proposed 
funding will be used, in part, to assist animal feedlot operation (AFO) 
owners to develop and implement waste management plans. AFOs are 
potential sources of pathogens which can impair drinking water sources.
    MWD urges you and your Subcommittee to support full funding for 
EQIP and NRCS CTA as requested in the President's fiscal year 2000 
budget for USDA, with the specific earmark allocation of EQIP funds to 
the Salinity Control Program. MWD also recommends that the Colorado 
River Basin be designated as a national priority area for salinity 
control.
Wildlife Habitat Incentives Program
    The Wildlife Habitat Incentives Program (WHIP) is a voluntary 
program, providing technical assistance and cost-sharing, to help 
landowners develop habitat on their properties that will support 
wetland wildlife, upland wildlife, threatened and endangered species, 
fisheries, and other types of wildlife. WHIP offers an opportunity to 
encourage development of improved wildlife habitat on eligible lands by 
providing assistance to landowners who wish to integrate wildlife 
considerations into the overall management of their operations.
    WHIP cost-sharing assistance could be utilized to support ongoing 
interim conservation efforts both in the Bay-Delta estuary and for the 
Lower Colorado River Multi-Species Conservation Program. The CALFED 
Bay-Delta Program is a cooperative effort among state and federal 
agencies and the public to develop a long-term, comprehensive solution 
to ecosystem and water supply problems in the Bay-Delta. One of the 
main objectives of the CALFED Bay-Delta Program is to improve and 
increase aquatic, wetland and riparian habitats so that they can 
support sustainable populations of wildlife species, by implementing a 
system-wide ecosystem restoration approach. WHIP could benefit this 
program by providing cost-share assistance for the development of 
wildlife habitat on private lands in the Bay-Delta watershed.
    The Lower Colorado River Multi-Species Conservation Program (LCR 
MSCP) is a broad-based partnership of state, federal and private 
entities in Arizona, California, and Nevada. Participants include 
water, hydroelectric power and wildlife resource management agencies, 
Tribal governments, and environmental organizations with interests in 
the Lower Colorado River. The LCR MSCP is focusing on the conservation 
of over 70 threatened, endangered and sensitive species and their 
habitats. WHIP would allow the combination of federal cost-sharing 
dollars and voluntary agricultural land-use practices to enhance 
habitat for listed and sensitive species of interest in the Lower 
Colorado River. This could be a valuable vehicle for gaining further 
agricultural support for conservation efforts and the goals of the LCR 
MSCP.
    The President's budget requests $210 million for WHIP for fiscal 
year 2000. MWD recommends that you and your Subcommittee support 
continued funding of WHIP at the level requested in the President's 
fiscal year 2000 budget for USDA.
Conservation Reserve Program
    Continued support for the Conservation Reserve Program (CRP) is 
necessary in order to build on the past successes of this USDA 
conservation program. Under the CRP, incentive payments are provided to 
producers to remove highly erodible and other environmentally sensitive 
land from production. This program helps protect the quality of 
drinking water supplies and facilitates ecosystem restoration efforts 
by reducing soil erosion, improving water quality, protecting wildlife 
habitats, and achieving other natural resource conservation measures. 
The National Buffer Initiative program will further maximize 
environmental benefits per dollar expended, and we are supportive of 
this effort.
    Enrollment of eligible agricultural lands that are located in the 
Bay-Delta estuary and tributary watersheds in the CRP, could provide 
water quality improvement benefits for this important source of 
drinking water. We note, however, that the method which determines the 
rental rate for CRP enrollments effectively precludes the enrollment of 
much irrigated agriculture land and land with high value crops. As a 
result, states in the arid west do not benefit from the CRP in 
proportion to their contribution to agricultural production. While MWD 
urges you and your Subcommittee to support the President's budget 
request for the CRP of $1.596 billion for fiscal year 2000, we also 
strongly request that you review the method for rental rate 
determination. We understand that one of the key actions under the 
Clean Water Action Plan is to review and increase, where appropriate, 
the incentives available for conservation buffers. Such review should 
also be undertaken for the CRP overall.
Wetlands Reserve Program
    The Wetlands Reserve Program (WRP), first authorized in 1990, is a 
voluntary program providing incentives to landowners for the 
restoration and protection of wetlands with long-term or permanent 
easements. Wetlands restoration provides important water quality 
improvement and wildlife habitat restoration benefits that are 
important to the Bay-Delta estuary. MWD urges you and your Subcommittee 
to support appropriation of $209 million for the WRP in fiscal year 
2000, as requested in the President's budget. Full support for the WRP 
is necessary to achieve the Administration's goal of enrolling an 
additional 199,820 acres into the program currently, for a cumulative 
enrollment of approximately 825,000 acres by the end of 1999 and 
975,000 acres by the end of calendar year 2000.
Conclusion
    Thank you for your consideration of our testimony. We believe our 
comments emphasize the importance of continued funding for USDA's 
agricultural conservation programs. The USDA's conservation programs 
are critical for achieving Colorado River Basin salinity control 
objectives, as well as broader wildlife habitat restoration and source 
water quality protection objectives in the Colorado River Basin and the 
Bay-Delta estuary.
                                 ______
                                 

                      Letter From Charles E. Kruse

                           Missouri Farm Bureau Federation,
                                Jefferson City, MO, April 21, 1999.
Hon. Thad Cochran,
Chair, U.S. Senate Appropriations Agriculture Subcommittee,
Washington, DC.
    Dear Senator Cochran: On behalf of Missouri Farm Bureau, I am 
submitting this letter as public record of our support of the 
agricultural policy research conducted by the Food and Agricultural 
Policy Research Institute (FAPRI) consortia. As Missouri's largest 
general farm organization, Farm Bureau maintains a strong working 
relationship with the FAPRI institutions.
    As you know, U.S. farmers and ranchers are currently facing many 
challenges. Low commodity prices are threatening the viability of 
agriculture as we know it and it is critical that policy-makers have 
access to the best analysis possible. Furthermore, producers must 
utilize this information as they attempt to restore profitability. 
FAPRI has a well-deserved reputation for conducting objective research; 
both large-scale econometric and farm-level economic and environmental 
modeling. Their researchers go to great lengths to validate models 
using both economic theory and producer input.
    Over the years, with the assistance of federal funding, FAPRI has 
developed a comprehensive modeling system that remains the envy of the 
world. Their system, capable of quantifying proposed policies from the 
international to the farm level, is more important than ever. We 
appreciate their efforts and believe they continue to be a tremendous 
asset to American agriculture.
            Sincerely,
                                          Charles E. Kruse,
                                                         President.
                                 ______
                                 
    Prepared Statement of the National Association of Conservation 
                               Districts
    The National Association of Conservation Districts is a nonprofit, 
nongovernment organization that represents the nation's 3,000 
conservation districts and more than 16,000 men and women who serve on 
their governing boards. Established under state law, conservation 
districts are local units of state government charged with carrying out 
programs for the protection and management of natural resources at the 
local level. Conservation districts work with nearly two-and-a-half 
million cooperating landowners and operators each year and provide 
assistance in managing and protecting nearly 70 percent of the private 
land in the contiguous United States.
    NRCS's Conservation Technical Assistance Program, delivered through 
local conservation districts to cooperators and other land users, is 
the nation's foremost private lands pollution prevention program. It 
provides landowners and operators with much needed help in planning and 
applying conservation treatments to control erosion and improve the 
quantity and quality of soil resources; improve and conserve water; 
enhance fish and wildlife habitat; conserve energy; improve woodland, 
pasture and range conditions; and protect and enhance wetlands. Many 
federal and state agencies also rely upon the technical expertise 
unique to NRCS to carry out other conservation programs that complement 
the NRCS effort not only in the agricultural areas, but in rural, 
suburban and urban communities as well.
    Conservation districts believe that the federal government must 
provide a basic level of technical assistance funding to maintain its 
commitment to support locally led conservation initiatives that 
complement federal efforts to ensure a safe and productive environment. 
The federal technical presence that NRCS provides is vital to ensuring 
that sound technical standards are maintained in our nation's 
conservation programs. It is also critical in the actual implementation 
of needed conservation practices.
    This NRCS technical presence, along with federal cost-share 
programs, leverages a tremendous investment in conservation by state 
and local governments. State and local governments contribute nearly $1 
billion in personnel and cost-share funding each year to support 
conservation programs carried out by the partnership. This is roughly 
equal to NRCS's annual budget and does not include the volunteer time 
of district officials.. Many states are also working to increase this 
support, but depend on the federal government to provide its fair 
share.
    In developing funding recommendations for specific agencies and 
programs, we recognize our own responsibilities to contribute a fair 
share of resources. NACD's recommendations on federal funding for NRCS 
conservation programs are based on input from conservation districts, 
state and local program managers and data from various surveys and 
reports examining the workload generated by federal, state and local 
program authorities. Although this statement focuses primarily on the 
Natural Resources Conservation Service, additional recommendations on 
other important USDA programs are contained in the attached chart.
                   conservation technical assistance
    In September 1998, the Conservation Partnership of NRCS, NACD, the 
National Association of State Conservation Agencies, National 
Association of Resource Conservation and Development Councils and the 
National Conservation Districts Employees Association completed data 
collection for its first-ever National Field Workload Analysis. The 
purpose of the study was to examine the staff years of technical 
support needed at the field level to carry out 29 core work elements in 
fiscal year 1999 and beyond.
    Early analysis of the data show that, nationally, the resources 
needed exceeded those available to address each of the core work 
elements, thus revealing a ``gap'' in the Conservation Partnership's 
capability to maintain the nation's basic conservation infrastructure. 
Although the analysis has yet to be finalized, it appears that the gap 
for NRCS technical assistance is more than 7,000 staff years. Initial 
reports also indicate that an additional $300 million in funding for 
conservation technical assistance to support 3,000 new field staff 
years is needed to provide adequate conservation assistance at the 
local level.
    Even without the National Field Workload Analysis data it is 
obvious that the responsibilities of NRCS and its partners have 
increased significantly over the past few years. The 1985, 1990 and 
1996 Farm Bills created substantial new demands from farmers and 
ranchers for conservation assistance. The Clean Water Act and the Safe 
Drinking Water Act, with their nonpoint source pollution and source 
water protection initiatives, increased the for assistance to install 
land treatment measures to protect water quality. The President's Clean 
Water Action Plan, which includes the Unified Animal Feeding Operations 
Strategy, will add significantly to the workload as thousands of 
producers request assistance in developing comprehensive nutrient 
management plans. Increasing requests for farmland protection and urban 
conservation assistance are further burdening an already overstressed 
conservation delivery system.
    All of this is occurring at a time when Congress is ratcheting the 
budget down and agency budgets are shrinking in real terms. If America 
is serious about protecting its resource base, however, we must not let 
our conservation efforts diminish and fall by the wayside. We must 
demonstrate a renewed commitment to our natural resources, the 
foundation of the nation's economic prosperity.
    Although our National Field Workload Analysis final reports will no 
doubt show a much greater need to effectively address conservation 
issues on private lands, our federal partners have reported that an 
additional $90 million is the bottom line needed just to sustain 
current efforts and prevent a reduction in staff at the field level. We 
urge you to support this increase, at a minimum, to maintain the basic 
infrastructure of private lands conservation efforts.
          conservation technical assistance and the farm bill
    When Congress passed the Federal Agricultural Improvement and 
Reform Act of 1996--the 1996 Farm Bill--it signaled a renewed 
commitment to a locally led, incentive-based approach to private lands 
conservation. In addition to fine-tuning existing programs, it provided 
new opportunities to promote voluntary conservation efforts on private 
lands through the Environmental Quality Incentives Program (EQIP), 
Farmland Protection Program, Conservation Farm Option and Wildlife 
Habitat Incentives Program.
    Although it fashioned new opportunities, the Farm Bill added 
significant new responsibilities for USDA and its state and local 
partners. These new responsibilities, which the Conservation 
Partnership welcomes, also have unintentionally created problems 
because there simply are not enough staff and funding resources 
available to carry out the new programs and still maintain a basic 
conservation program at the field level.
    These federally mandated activities are pulling NRCS staff away 
from addressing significant local natural resource problems. Often, 
these federal programs do not adequately address local conservation 
issues by the federal programs. These new programs have not been 
accompanied by any increase in staff ceilings or any significant 
increase in technical assistance funding.
    The shortfall in technical assistance is further compounded by the 
fact that the Farm Bill conservation programs are funded through the 
USDA Commodity Credit Corporation (CCC). Although Congress intended for 
the CCC to reimburse NRCS for technical assistance activities in 
carrying out the Farm Bill programs, it unintentionally created a 
serious problem by capping the amount of CCC funds that USDA could 
spend on personnel and administrative services to carry out CCC 
programs at $36 million--the level spent in 1995, before CCC was 
responsible for the Farm Bill conservation programs. The unintended 
result was that NRCS would be responsible for carrying out the CCC-Farm 
Bill programs, but the Corporation would be severely limited in its 
ability to fund the technical assistance needed for the effort. Since 
the passage of the 1996 Farm Bill, much of the funding for conservation 
technical assistance has come from unspent funds remaining from 
previous spending authority. These sources for technical assistance to 
support CCC-funded conservation programs are essentially depleted 
leaving NRCS with a serious shortfall in technical assistance funding.
               watershed protection and flood prevention
    Through its Small Watersheds Program (Public Law 83-566 and Public 
Law 78-534), NRCS partners with states, local units of government, 
tribes and other sponsoring organizations to address water quality and 
quantity issues and assistance communities in flood prevention 
activities. More than 2,000 plans, covering 160 million acres in 
watersheds in every state, Puerto Rico and the Pacific Basin, have been 
completed or are underway. Land treatment measures have been applied to 
more than 30 million acres and more than 15,000 individual measures 
have been installed, resulting in substantial contributions to 
environmental improvement, economic development, flood prevention and 
social well being.
    However, many of the more than 10,000 structures built over the 
past 50 years are nearing the end of their lifespan, no longer meet 
current dam safety standards and need to be upgraded, repaired or 
decommissioned. Approximately 5,000 of the installed floodwater 
retarding structures are 30 years old. More than 70 percent of all 
structures were built before the National Environmental Policy Act of 
1970 was fully implemented and thus, may not have considered all 
environmental impacts.
    Over time, the areas surrounding the structures have changed. 
Populations have grown. Flood plains have been developed. Upstream land 
use has changed. Sediment pools have filled. Flood-pool capacities have 
decreased. Structural components and vegetated measures have 
deteriorated. As a result, public safety, quality of life and community 
economic stability are being affected.
    Under many of the original agreements, local sponsors accepted 
responsibility for assuring that the structures would function as 
designed over their lifetime. Sponsors, many of which are conservation 
districts, and NRCS are now finding that they may have liability almost 
in perpetuity for the integrity of these structures. In most cases, 
sponsors have diligently maintained the structures, but because dam-
safety requirements have changed dramatically since the 1970s, many 
find they do not have the resources needed for costly renovations 
needed to keep them safe, functional and in compliance.
    By the year 2000, approximately 2,000 structures built with 
assistance from the NRCS Small Watershed Program will require 
significant rehabilitation work to meet current environmental, economic 
and safety needs. Unless these issues are addressed, the magnitude of 
the problems will only increase as the infrastructure continues to age. 
Project sponsors in the 500 active watersheds need technical and 
financial assistance to implement rehabilitation plans to meet current 
environmental, economic and safety needs. NRCS estimates that roughly 
$540 million in federal, state and local resources is needed to protect 
and upgrade already installed works. To meet its share of that need, 
conservation districts recommend funding for the NRCS Watershed 
Protection and Flood Prevention account to $120 million in fiscal year 
2000.
    In his budget request, the President proposes transferring all 
technical assistance for Watershed Surveys and Planning and Watershed 
Protection and Flood Prevention Operations to the Conservation 
Operations Program after enactment of appropriate legislation. 
Conservation districts oppose shifting technical assistance out of the 
Watershed and Flood Prevention Operations account. We believe that 
action would be the first step toward dismantling this important 
program and that Public Law 566 funds would likely disappear in future 
budget proposals.
                      forestry incentives program
    The President's proposal requests no funding for the Forestry 
Incentives Program (FIP) because it promotes timber production on 
private lands. Congress transferred FIP from the Farm Service Agency to 
NRCS as part of a major program restructuring in the Federal 
Agricultural Improvement and Reform Act of 1996 in recognition of NRCS 
as the Department's private lands natural resource management agency. 
Its technical assistance is used primarily to assist America's farmers 
in production agriculture, as do its conservation cost-share programs. 
USDA recognizes private lands forestry as a farming activity, and the 
Internal Revenue Service treats forestry cost-share payments as such. 
Conservation districts urge Congress to fund the Forestry Incentives 
Program at $25 million for fiscal year 2000.
             resource conservation and development program
    Through its Resource Conservation and Development Program (RC&D), 
NRCS provides conservation assistance to rural communities. Resource 
management and rural development initiatives undertaken by local RC&D 
councils help revitalize economically disadvantaged rural areas. 
Conservation districts support increasing RC&D funding to $69 million 
in fiscal year 2000 to support funding for 450 RC&D Councils as 
authorized under the program's enabling legislation.
                           farm bill programs
    The 1996 Farm Bill established the Environmental Quality Incentives 
Program (EQIP), the Conservation Farm Option (CFO), the Wildlife 
Habitat Incentives Program and the Farmland Protection Program (FPP) 
and strengthened and re-focused the Conservation Reserve and Wetlands 
Reserve Programs. Conservation districts continue to be strong 
supporters of these initiatives that protect soil resources, water 
quality, wetlands and wildlife habitat.
    EQIP, in particular, is a highly targeted program intended in part 
to help producers comply with the requirements of the Farm Bill and 
other federal and state conservation programs. Requests from producers 
for assistance through EQIP have been overwhelming--far exceeding the 
amount of funds available and further stressing the already 
overburdened NRCS-conservation district delivery system. With 
additional funding EQIP has the potential to garner tremendous 
environmental benefits. It also provides an opportunity to reach out to 
socially disadvantaged producers who traditionally have not 
participated in USDA's conservation programs Conservation districts 
support the President's budget request to raise EQIP funding to $300 
million annually to further enhance the program's outreach, water 
quality, soil conservation and wildlife habitat benefits. The attached 
chart includes recommendations for other NRCS conservation financial 
assistance programs.
    The 1996 Farm Bill also authorized the Secretary of Agriculture to 
establish a grazing lands conservation initiative to provide technical 
and educational assistance to landowners on the nation's 642 million 
acres of private grazing lands. Conservation districts support this 
initiative and urge Congress to provide at least $15 million for its 
operation in fiscal year 2000.
    The Wetlands Reserve Program (WRP) provides assistance to farmers 
to restore cropped wetlands through easements and cost-share payments. 
In addition to its environmental and wildlife habitat benefits, this 
voluntary wetland protection program has been extremely popular among 
farmers and ranchers. Conservation districts support funding WRP at 
$207.065 million in fiscal year 2000 to enroll the remaining authorized 
acreage in the program.
    The Conservation Reserve Program similarly provides cost-share 
assistance and rental payments to farmers to retire highly erodible and 
environmentally sensitive cropland for 10 to 15 contract periods. In 
addition to dramatically reducing soil erosion on cropland by as much 
as 694,062,336 tons per year, it provides myriad other benefits 
including stemming agricultural runoff and providing critically needed 
wildlife habitat. Conservation districts strongly support the CRP and 
recommend funding to enroll the maximum number of acres authorized.
 funding for cooperative state research, education & extension service
    Several extension programs represent critical components are 
significant in USDA's natural resource management delivery system. For 
example, the Renewable Resources Extension Act provides educational 
assistance to help private landowners manage their lands to meet 
commodity demands and needs. At the same time, it provides many public 
values associated with the forests and rangelands of our nation
    Research also remains one of the keys to the continued vitality of 
agriculture and effective management of the nation's resource base. 
U.S. competitiveness in world markets is contingent an aggressive 
research and development program for agricultural conservation and 
production techniques. We also recognize that conservation, 
environmental quality and production research needs vary across the 
United States. Conservation districts support maintaining strong 
research programs in NRCS, the Agricultural Research Service, the 
Cooperative State Research, Education and Extension Service and other 
agencies as needed.
    America's conservation districts fiscal year 2000 funding 
recommendations begin rebuilding the nation's commitment to helping 
land managers conserve natural resources on private lands. They 
represent a commitment to embrace and protect the nation's natural 
resources for our present and future generations.
    We appreciate the opportunity to provide our recommendations to the 
Subcommittee.
                                 ______
                                 

    Prepared Statement of the National Association of Home Builders

    The National Association of Home Builders (NAHB), which represents 
more than 197,000 member firms, offers the following comments on the 
administration's fiscal year 2000 budget for U.S. Department of 
Agriculture's Rural Housing Service (RHS) programs.
    NAHB believes there is a critical need for affordable housing in 
rural areas overall. Unfortunately, there are serious obstacles to 
providing such housing. High among these obstacles are problems with 
the availability of credit in rural areas compared to urban areas. The 
flow of capital into rural areas is crucial to the economic health of 
these rural areas. This position is supported by reports analyzing 
rural credit markets that were presented to the Senate Agriculture 
Committee during the 105th Congress by the Economic Research Service, 
the U.S. General Accounting Office, the Federal Reserve Bank of Kansas 
City and the Rural Policy Research Institute.
    In light of the acknowledged shortage of housing opportunities for 
rural families with low- and moderate-incomes, NAHB strongly believes 
that the federal programs designed to provide affordable housing in 
rural areas, i.e. the programs administered by USDA's Rural Housing 
Service, are crucial. These programs include both rental housing 
programs and programs that provide homeownership opportunities through 
direct loans at below-market interest rates and loan guarantees.
               rural housing service multifamily programs
    In the multifamily arena, Congress provided $114 million in direct 
loans for Section 515 multifamily rental housing production for fiscal 
year 1999. The Administration has requested a further reduction for 
fiscal year 2000 to $100 million. The recent budget allocation and 
requests for the Section 515 program suggest intent to replace it with 
the Section 538 multifamily loan guarantee program. This would be a 
serious mistake since the bulk of Section 515 recipients are at incomes 
too low to qualify for the rents charged to meet the mortgage and other 
debt service payments necessary for the Section 538 multifamily rental 
housing loan guarantee program. The two programs simply are not 
structured to serve families of similar incomes. Therefore, NAHB 
supports an increase, not a decrease, in current funding for Section 
515. A program level of $300 million annually is supportable to meet 
the needs of rent burdened low-income families in non-urban areas. In 
view of the desire of many in Congress to maintain the budget caps 
imposed for fiscal year 2000 by the 1997 Budget Reconciliation Act, and 
discussions with RHS staff, a level of $300 million for the Section 515 
program would be defensible and desirable. NAHB would support this 
level. Appropriating $300 for the Section 515 program would to a long 
way toward meeting the serious housing needs of lower income families 
and the elderly in rural America.
    Likewise, the Section 538 program increase requested by the 
administration, from the $100 appropriated in fiscal year 1999 to $200 
million requested for fiscal year 2000, is too minimal. Current low 
interest rates and continued economic growth support a program level 
nearer to $300 million per year for this program that costs the 
government very little to support. As no budget authority is needed to 
support this program, NAHB believes that it would be a serious mistake 
to underfund the anticipated demand for the worthwhile Section 538 loan 
guarantee program.
    We also recommend that the $640 million requested for Section 521 
Rental Assistance not be split between fiscal year 2000 and 2001 as 
proposed in the administration's budget. Such an approach could 
threaten the renewal of expiring rental assistance contracts and might 
harm efforts to preserve the affordable housing stock in rural areas. 
The $640 million request should be applied entirely in fiscal year 2000 
so as not to create funding allocation problems in future years. 
Additionally, RHS staff informs us that this level allows for very 
little new construction activity. Consequently, NAHB would strongly 
support any increase that Congress might provide.
              rural housing service single family programs
    The fiscal year 1999 budgetary authority for the Rural Housing 
Service Section 502 Guaranteed Rural Housing (GRH) loan program is $3 
billion. Through March 2, 13,818 loans have been made under the Section 
502 GRH program for a total of $1.304 billion. Funds for future loans 
are allocated to program users through a reservation system. The exact 
amount of funds reserved is not publicly known, but NAHB believes that 
the sum of loans closed and loans reserved is closing in on the $3 
billion level authorized for fiscal year 1999. In fact, NAHB 
understands that RHS will be forced to institute a moratorium on 
additional reservations for the Section 502 GRH program in May or early 
June, effectively removing the Section 502 GRH program as a financing 
option for rural home buyers until the beginning of fiscal year 2000.
    Demand for the Section 502 GRH program has proven increasingly 
popular over the past few years, growing from just 662 loans for $38.4 
million in fiscal year 1991 to 39,403 loans totaling $2.82 billion in 
fiscal year 1998. The withdrawal of the Section 502 GRH program, even 
temporarily, will have a detrimental effect on families who need the 
program to qualify to purchase homes, and will cause lenders to have 
second thoughts regarding future participation in the program. A major 
source of the rural mortgage credit shortage has been a lack of lender 
interest and participation in these markets. The Administration has 
proposed an authorization of $3.2 billion for this program for fiscal 
year 2000. At a minimum, NAHB believes that a program level of $4 
billion should be authorized for the Section 502 Guaranteed Rural 
Housing loan program to ensure uninterrupted operation and continued 
lender participation.
    The Section 502 Direct loan program has been obligated for 4,783 
loans totaling $281.5 million this fiscal year. With a fiscal year 1999 
budget of $965 million, it appears on the surface that this program 
might be adequately funded. Unfortunately, RHS is currently holding 
additional applications for 24,756 loans totaling $1.666 billion, a 
good portion of which could be made this year if the budgetary 
authority were available. Discussions with RHS staff yield a 
recommended program level of at least $1.5 billion as the minimum level 
needed to responsibly serve those applications on hand.
    Like the Section 502 Direct program, the Section 504 loan and grant 
programs have backlogs far exceeding the budgeted levels. The Section 
504 loan program has seen 1,373 loans closed totaling $6.8 million out 
of a fiscal year 1999 budget of $25 million. Currently, however, there 
is a backlog of 4,740 applications totaling $31 million. Almost 2,100 
Section 504 grants have been made totaling $9.5 million out of a budget 
of $20 million. There is a backlog of 11,159 grant requests totaling 
$22.3 million. NAHB believes that the Section 504 loan and grant 
programs should each be authorized at $50 million for fiscal year 2000.
    In closing, NAHB strongly supports viable Rural Housing Service 
programs, funded at responsible levels, as we believe both are 
necessary to help meet the needs for affordable housing for low- and 
moderate-income families and the elderly living in rural areas. For 
Congress to allocate federal resources for fiscal year 2000 at the 
levels requested by the administration for the Rural Housing Service 
programs will fail to meet current demand on these important programs. 
Consequently, NAHB respectfully urges funding the rural housing 
programs at the more responsible levels noted above.
    We appreciate your consideration of our views as you formulate the 
fiscal year 2000 Agriculture Appropriations Bill. Thank you.
                                 ______
                                 
Prepared Statement of the National Association of Professional Forestry 
                          Schools and Colleges
    The National Association of Professional Forestry Schools and 
Colleges (NAPFSC) is comprised of the 67 universities that conduct the 
Nation's research, teaching, and extension programs in forestry and 
related areas of environmental and natural resource management. NAPFSC 
strongly supports increased funding for federal forestry research 
programs, including those operated by the USDA's Cooperative State 
Research Education and Extension Service (CSREES) and the Forest 
Service. We appreciate this opportunity to comment on the three 
programs administered by CSREES which greatly enhance the abilities of 
our member institutions to effectively address forest and natural 
resource issues facing our nation: the McIntire-Stennis Cooperative 
Forestry Research Program (McIntire-Stennis), the Renewable Resources 
Extension Act (RREA), and the National Research Initiative (NRI). All 
three of these programs have stimulated the development of vital 
partnerships involving universities, federal agencies, non-governmental 
organizations and private industry.

                                      USDA-CSREES FORESTRY RELATED PROGRAMS
----------------------------------------------------------------------------------------------------------------
                                                                FISCAL YEAR--
                                         ----------------------------------------------------------  AUTHORIZED
                                                                      2000 CLINTON    2000 NAPFSC       LEVEL
                                          1998 ENACTED  1999 ENACTED     BUDGET     RECOMMENDATION
----------------------------------------------------------------------------------------------------------------
MCINTIRE-STENNIS........................   $20,497,000   $21,932,000   $19,882,000    $23,332,000        ( \1\ )
RREA....................................     3,192,000     3,192,000     3,192,000      4,000,000    $15,000,000
NRI.....................................    97,200,000   119,300,000   200,000,000    200,000,000   ............
----------------------------------------------------------------------------------------------------------------
\1\ One-half of Forest Service Research Budget (approx. $95 million).

    The National Association of Forestry Schools and Colleges believes 
that university-based education is central to providing the research 
and landowner education that is needed to address NIPF issues. On 
February 22-23, NAPFSC co-hosted, along with USDA, a major ``Forestry 
Summit'' in Washington, D.C. with over 90 key forestry leaders from 
across the nation, including tree farmers, representatives from forest 
landowner associations, forest industry, forestry consultants, and 
representatives from state and federal agencies and universities.
    The outcome of the Summit confirmed the need for increases in 
forestry research funding with a particular focus on non-industrial 
private forestlands and forest productivity and an increase in 
collaborative efforts between university-based research and that of the 
Forest Service.
    The Case for Enhanced Forestry Research Funding.--NAPFSC submits 
that a ``quiet crisis'' is rapidly approaching in the nation in terms 
of the need for more university-based forestry research and extension. 
The forests and other renewal natural resources of this country are 
primary contributors to the economic health of the nation; are 
reservoirs of biodiversity important to the well-being of our citizens; 
are significant to the maintenance of environmental quality of our 
atmosphere, water, and soil resources and provide diverse recreational 
and spiritual renewal opportunities for a growing population.
    Tremendous strains are being placed upon the nation's private 
forest lands by the combination of increasing demands for forest 
products coupled with dramatic changes in timber policies concerning 
our National Forests. Because of the changes in federal forest policy, 
private forest lands in the United States are now being harvested at 
rates not seen since the beginning of the 20th century.
    Until recently, wood and wood fiber demands have been met in 
significant part from federal lands. The changes in federal forest 
timber harvesting policy means the bulk of supply requirements has 
shifted to privately owned forest lands. To meet this challenge, 
research priorities must be adjusted to better address the needs of 
private landowners, and to specifically enhance the productivity of 
such lands through economically efficient and environmentally sound 
means. Increased fiber imports are not a viable option as the Nation 
cannot afford the trade imbalance, loss of jobs, loss of rural 
economies, or the importing of potentially serious plant, animal, and 
human diseases and pests. These challenges, however, can be 
substantially addressed by the university community through the 
building of integrated research and extension programs assisted by 
McIntire-Stennis, RREA, and NRI.
    Non-industrial private forest (NIPF) landowners provide a large 
array of goods and services throughout the country. For example, in the 
East, NIPFs are projected to increase their timber harvests almost 30 
percent from the 1986 levels until 2010. Hardwood timber harvests on 
NIPF lands in the South are actually projected to increase more than 60 
percent from 1986 to 2010. These spectacular increases will require 
larger investments and enhanced public educational programs--and 
hopefully much more regeneration and intensive timber management--at a 
scale never before realized on NIPF lands in the U.S.
    There are currently approximately 10 million private forestland 
owners in the U.S. These landowners control nearly 60 percent of all 
forestland in the country. And it has been to the universities, with 
strong support from CSREES, that landowners traditionally look for new 
information about managing their lands. The combination of research 
conducted by the forestry schools, combined with the dissemination of 
that research through the cooperative extension network, has never been 
more essential.
    The overwhelming majority of the 10 million private landowners are 
not currently equipped to practice the sustained forest management that 
is critical to the health of our environment and economy. Not only are 
these lands important to the nation's supply of wood and fiber, these 
same lands provide other substantial benefits to their owners and the 
nation, including wildlife habitat, clean water and recreation. 
Enhanced forestry research and extension activities is essential to 
reach these landowners. Although the McIntire-Stennis, RREA, and NRI 
programs can help address these concerns, these programs are 
inadequately funded.
    Mr. Chairman, NAPFSC is pleased that Congress provided a small 
increase in fiscal year 1999 for the McIntire-Stennis program; the 
first increase in several years. We are very concerned about the more 
than nine percent reduction proposed in President Clinton's fiscal year 
2000 budget for the McIntire-Stennis forestry program. That is the 
wrong direction when there is such a great need for increased forest 
research and extension. While much of the President's budget calls for 
increases in federal research and development funding, agriculture and 
forestry research were targeted for decreases. We believe that reducing 
the McIntire-Stennis program is short-sighted. The National Association 
of State Universities and Land-Grant Colleges (NASULGC) has recommended 
a McIntire-Stennis funding level of $23,332,000. We strongly support 
funding at least at this level.
    For more than 25 years, McIntire-Stennis funds have been a critical 
part of University-based forestry research. McIntire-Stennis funds 
leverage significant additional state and private support and assure 
long-term forest resource research, graduate training, and outreach 
across the country. Each dollar in federal appropriations has been 
leveraged by a factor of up to five in non-federal dollars in support 
of research programs having state, regional, and national significance.
    Importance of Forestry Research and Extension.--Research has 
improved the understanding of (1) the biology of forest organisms; (2) 
the structure and function of forest ecosystems; (3) human-forest 
interactions; (4) wood as a renewable raw material; (5) economics, 
environmental policy, and business management related to the forest 
industry; and (6) international trade, competition, and cooperation. 
McIntire-Stennis programs have advanced our knowledge of the forest 
ecosystem including the basic chemical, physical, and biological forces 
that influence forest health and productivity. These programs have also 
expanded the marketing horizons for environmentally friendly and 
renewable wood and fiber-based products. Very recent work has examined 
the economic and ecological benefits of combining agricultural and 
forestry practices into integrated land-use systems termed 
``agroforestry''. Furthermore, these programs have significantly aided 
the development of new forest management systems for multiple-uses 
including timber, water, wildlife, grazing, recreation, and aesthetic 
purposes.
    The Renewable Resources Extension Act (RREA) provides funds for 
technology transfer and educational outreach to ensure that the 
benefits of forestry research are made available to private forestland 
owners and forest industries through CSREES. More than ever before this 
program is needed to help private landowners address the increasing 
challenges facing non-federal forest lands. President Clinton 
recommended a funding level of $3,192,000 in his fiscal year 1999 
budget. NAPFSC recommends funding RREA at a level of $4 million for 
fiscal year 1999. We urge the Committee to support the NASULGC request. 
This increase would take RREA to slightly over 25 percent of its 
authorization level.
    RREA funds have created programs and provided expertise that 
benefit private forestland owners and the forest product industry 
throughout the country. For example:
  --In Arkansas, over $5 million have been estimated to have been 
        earned or saved by forestland owners and the forest products 
        industry because of RREA educational programs.
  --In Washington, RREA funding allows the universities to engage in 
        logger training activities. To date, 289 loggers have fulfilled 
        accreditation standards, and regulatory agencies are reporting 
        improved compliance with forest practice rules.
  --In Missouri, RREA funding supported a Wildlife Habitat Enhancement 
        Program for Conservation Reserve lands. Participants have 
        already installed practices benefitting 125,000 acres.
    Similar stories can be found in all 50 states. It is vital that 
Congress continue proper funding for this important program for 
distributing the knowledge gained through our research institutions to 
the private landowners.
    Lastly, we urge your support of the Competitive Grants Program 
administered under the National Research Initiative of the USDA. Peer 
competition for grants is at the heart of the university system and 
this program has become very important to natural resource scientists 
working within NAPFSC institutions. Research funds from NRI enable 
NAPFSC institutions to build upon the base provided by McIntire-
Stennis. We are pleased that President Clinton's budget calls for a 
funding level of $200 million for fiscal year 2000, a level also 
recommended by NASULGC, and we urge your Subcommittee to fund the 
program at this requested level.
    The past, present, and future success of forestry research and 
extension activities arising from the NAPFSC member institutions 
results from a unique partnership involving federal, state, and private 
cooperators. Federal agencies have concentrated on large-scale national 
issues while state funding has emphasized applied problems and state-
specific opportunities. University research in contrast, with the 
assistance of federal, state and private support, has been able to 
address a broad array of applied problems related to technology 
development and fundamental biophysical and socioeconomic issues and 
problems that cross ownership, state, region, and national boundaries. 
Schools and colleges with programs in forestry, forest products, and 
natural resources have the expertise in-house to address a broad range 
of problems and opportunities related to the forest resource and its 
use.
    We encourage expanded federal participation in this partnership 
with NAPFSC institutions through McIntire-Stennis, RREA, and NRI. We 
respectfully urge you to provide much needed increases for fund the 
McIntire-Stennis Cooperative Forestry Research Program, the Renewable 
Resources Extension Act, and the National Research Initiative in your 
fiscal year 2000 Agricultural Appropriations bill.
                                 ______
                                 
 Prepared Statement of the National Association of State Universities 
                        and Land-Grant Colleges
    Mr. Chairman, I am Bob Moser, Vice President for Agricultural 
Administration at The Ohio State University, and Chair of the National 
Association of State Universities and Land-Grant Colleges' (NASULGC) 
fiscal year 2000 Budget Committee. I represent the 105 institutions 
that work in close partnership with USDA's Cooperative State Research, 
Education, and Extension Service (CSREES). These universities comprise 
the State Agricultural Experiment Stations, Cooperative Extension, 
Forestry, Human Sciences, Veterinary and Academic Programs of the Land-
Grant Universities, representing the 1862, 1890, 1994 Colleges, and 
Hispanic-serving institutions. This testimony also encompasses the 
views of Thomas Payne, representing the Experiment Stations Committee 
on Organization and Policy, and Dick Wootton, representing the 
Extension Committee on Organization and Policy.
    The Land-Grant Universities and USDA's CSREES comprise a federal-
state partnership that links new science and technological development 
directly to the needs and interests of the people. It builds a strong, 
globally competitive U.S. agricultural system. This dynamic system 
evaluates environmental impacts of new concepts in production. It 
protects the health of the nation by producing a highly nutritious and 
safe food supply. It builds the capacity of the nation to access new 
information and to educate the coming generation of agricultural 
scientists, producers, and community leaders.
    We employ more than 24,000 professional staff who work directly 
with more than 40 million Americans each year through our Extension 
Service. We educate more than 150,000 college students. We conduct 
research projects central to the nation's interests in food, 
agriculture, natural resources, the environment, and human development.
    The member institutions of NASULGC and I appreciate the on-going 
support from this Subcommittee and pledge that investment in research, 
extension, and education programs will continue to benefit both farmers 
and consumers. Agriculture contributes to the economic well-being of 
the nation while providing Americans with the cheapest and safest food 
supply on the planet. Eleven percent of our wages, salaries, rents, and 
profits stem from food and agricultural-related businesses. Americans 
spend only 11 percent of their disposable income on food, compared with 
15 percent in France, 18 percent in Germany, 33 percent in Mexico, and 
51 percent in India. The profitability and quality of tomorrow's 
agriculture depends on today's research and education system.
    Research and development funding for space exploration, the 
environment, basic science research, and health research has increased 
in constant dollars from 23 percent to 58 percent over the last 10 
years. During that same time, funding for agricultural research and 
extension programs, the lifeblood of our food supply system, has shrunk 
by 8 percent in constant dollars. Base funds have eroded by 16 percent. 
These funds support the scientists and extension educators who can 
respond quickly and effectively to unexpected problems that arise for 
producers and consumers.
    The President's Budget for fiscal year 2000 proposes a net increase 
for research, extension and education of $174.2 million above fiscal 
year 1999 funding for USDA/CSREES. We strongly endorse this critically 
needed investment. However, we do not believe that the President's 
budget has identified the best mix of funding mechanisms. It eliminates 
some $64.5 million from funding lines that Congress typically supports 
and redirects these funds to other priorities supported by the 
Administration.
    We propose that the $174.2 million increase be distributed with a 
$40 million increase for base programs, a $120 million increase for 
competitive grants, and a $14.2 million increase for a mix of targeted 
mechanisms. Competitive grants and base funding are complementary and 
both are necessary funding tools. Base funding provides the foundation 
and stability to assure that needed long-term research and extension 
programs are supported. Base funds also provide for quick 
responsiveness to local and regional problems and unexpected crises, 
such as food safety issues or pest infestations, that could not have 
been anticipated in the budget preparation process. Competitive grants 
target high-priority ``discovery'' research and extension programs, and 
can operate efficiently with the infrastructure established through 
base funds.
    We will direct this funding toward critical needs and focus areas, 
determined after numerous meetings with interest groups and 
stakeholders. The issues mesh with the five goals developed by USDA as 
part of their process for responding to the Government Performance and 
Results Act:
goal 1. an agricultural production system that is highly competitive in 
                           the global economy
The changing structure of American agriculture: $40.324 million
    U.S. farm and ranch families are experiencing financial stress to a 
degree not matched since the mid-1980s, and they are facing this stress 
as protection provided by the government diminishes. There are many 
immediate challenges as a result of weather-related production problems 
and dramatic changes in international markets, putting many producers 
in jeopardy. Targeted programs are needed in the states to provide 
farmers and ranchers with risk management tools and capital management 
training necessary to make decisions in the short and long term to 
survive difficult times. Other factors impacting U.S. agriculture 
include new communication technologies, genetic modifications of plants 
and animals, vertical integration of parts of the industry, worldwide 
population growth and redistribution, a changing global economy, and 
changing farm policy.
Global competitiveness: $8.0 million
    The ability of the United States to compete in global markets will 
be increased by: (1) developing and disseminating information about 
market, trade, business, and global finance opportunities; (2) 
providing information about global agribusiness and investment 
opportunities; (3) developing and disseminating information about non-
tariff trade barriers; (4) identifying niche markets for agricultural 
products and their derivatives in other nations; and by developing 
options for improved decision making in global markets, trade, and 
policy; and linking farmers and agribusiness to international trade 
providers.
Agricultural genome, germplasm preservation: $45.0 million
    The mapping of the human genome has tremendous implications for 
future health and medical discoveries. In the same manner, mapping the 
genomes of economically important crops, animals, and microbes has 
tremendous implications for agricultural production and processing. The 
result of mapping critical agricultural genomes will also have great 
impact on food safety and quality, as well as environmental protection. 
In addition, it is essential that germplasm that has already been 
developed through the years is adequately preserved and protected. 
Targeted competitive grants are needed that complement the work of 
other agencies such as USDA/ARS, DOE, NASA, and NSF.
Ag in the Classroom: $0.268 million
    The Ag in the Classroom program plays a critical role in helping 
students gain some understanding of the realities of production 
agriculture. At a time when children might believe that milk comes 
directly from the grocery store, the Ag in the Classroom program 
assists in providing for a better-informed public-a public that knows 
that there are real cows, real farms, and real ranch families that help 
get that milk to the store.
            goal 2. a safe and secure food and fiber system
Food safety: $9.0 million
    (a) Prevention of food-borne illness ($3 million).--Research on the 
actual causes and prevention of food-borne illnesses as well as 
education on how to handle food safely not only saves money, but also 
saves lives. Prevention of food-borne illnesses is the responsibility 
of informed producers, processors, handlers, and consumers of food. 
Critical points of contamination must be identified and eliminated 
through targeted research and education programs. While we are in the 
process of more fully understanding the current list of microbial 
pathogens and food contaminants with each passing day, there are 
emerging and unidentified risks facing our food supply.
    (b) Risk assessment and management ($3 million).--Risk assessment 
is the relative degree of risk associated with natural and manufactured 
substances to which humans may become exposed. Safe food depends on 
broad-based understanding of the causes of food-borne illness, paths to 
prevention, and commitment to preventive practices employed by 
producers, processors, handlers, and consumers. Better methods are 
critically needed for analyzing available data and addressing any 
uncertainty. Understanding tolerance for risk--real and perceived--is 
an essential basis for education programs.
    (c) Safety of food imports ($3 million).--Food imports are 
increasing dramatically, bringing with them the threat of new and 
emerging diseases. Contamination could occur at any point in 
agricultural production, from the farm to the overseas processing 
plant. There is also the threat of introducing exotic diseases into the 
U.S. food supply and production systems. Furthermore, the integrity of 
future agricultural markets will depend on both avoiding domestic 
crises in food safety and preventing unfair trade barriers. Special 
attention must be given to cross border flows of safe and healthy food.
Pesticide management and FQPA implementation: $23.776 million
    In 1996, Congress passed the Food Quality Protection Act (FQPA), 
which resulted in many essential changes in food safety and pesticide 
laws. Included in this legislation was the repeal of the Delaney 
Clause, which imposed a zero-tolerance of pesticide residues. In its 
stead, EPA is in the process of reviewing more than 10,000 chemicals 
used on crops. It appears that some pesticides that have played a key 
role in current agricultural production practices will not be available 
to farmers and ranchers in the near future. Immediate steps need to be 
taken to identify alternative technologies and practices to replace 
agricultural chemicals that may soon become unavailable. EPA, USDA and 
the Land-Grant university community must work quickly to target 
research and education efforts to provide farmers with ecologically and 
economically sound alternatives to pesticides that may no longer be 
available.
          goal 3. a healthier, more well-nourished population
Expanded Food and Nutrition Education Program (EFNEP): $2.348 million
    The Expanded Food and Nutrition Education Program plays a pivotal 
role in assuring that the recipients of food assistance programs have 
the training and education that they need to improve the use of their 
food resources and the nutritional quality of their diets. EFNEP has a 
well-documented history of developing the ability of food assistance 
recipients to improve their diets with scarce resources and to fully 
benefit from the assistance they receive.
Nutrition and health: $6.0 million
    The capacity to learn and to contribute to society is traced 
directly to the quality of health and nutrition from prenatal status 
through adulthood. Healthy diets minimize illness and disease and 
reduce medical costs. Assuring a healthy, well-nourished population 
requires continuing effort toward development of quality research 
information on nutrient function for maintenance of optimal health, 
understanding the availability of food for all population groups, 
especially those at greater risk for nutrition-related diseases, 
including infants, the elderly, and new immigrant groups. Nutrition 
education can incorporate research information in a form that is 
appropriate to each of these segments of the population. Education 
should include knowledge of how to secure foods to provide adequate 
nutrition with a commitment to the dietary guidelines. Uses of foods to 
prevent diseases (e.g., functional foods) and the production of 
pharmaceuticals from plants are new areas of nutrition research that 
need to be targeted for support.
    goal 4. greater harmony between agriculture and the environment
Agricultural waste management: $14.0 million
    In the past several years, outbreaks of microorganisms linked to 
fish kills and human sickness have focused public attention on better 
management of nutrients, such as phosphorus and nitrogen. Some 
scientists believe nutrient runoff from agricultural plant and animal 
production nourishes algal blooms. In response to public concerns, EPA 
and USDA have recently developed a draft ``Unified National Strategy 
for Animal Feeding Operations (AFOs).'' This unified strategy 
identifies an array of research, extension, and education activities 
that need to be addressed. A mix of base support to address research 
needs in each state is combined with competitive grants to develop 
integrated research, extension, and education projects.
Water quality and nutrient management: $3.0 million
    Water quality and nutrient management encompasses the issues cited 
in the preceding paragraph. In addition to addressing the issues of 
agricultural waste, there is an array of pressing issues that need to 
be addressed, including increased collaboration with other agencies. 
Farm*a*Syst is a voluntary, science-based extension program that helps 
farmers and ranchers calculate and manage nutrient loading and run-off 
on their properties.
Carbon sequestration: $3.4 million
    Carbon sequestration could be part of the solution to global 
climate change. Agricultural crop production uses carbon dioxide from 
the atmosphere, sequestering the carbon back into plants and the soil. 
Optimizing the efficiency of agricultural plant production therefore 
reduces possible threats from global warming. Forest production also 
plays a pivotal role in carbon sequestration. Base funding for forest 
research and integrated competitive grants is recommended so that 
efficient agricultural production can help protect the global 
environment.
The changing American landscape: $2.0 million
    The American urban-suburban-rural interface is rapidly shifting. As 
a consequence of new demographic patterns, attention needs to be 
focused on supporting management decisions by local authorities. New 
knowledge is needed on policy and program options, and the consequences 
of those choices.
    goal 5. enhanced economic opportunities and quality of life for 
                               americans
The changing structure of rural America: $7.0 million
    Rural America includes the vast and dynamic regions of the national 
landscape that produce our food, fiber, and raw materials that support 
our industries, recreation, and a valued quality of life. In the 
twenty-first century, forces that will shape rural America include 
information technology, genomics, and global information systems and 
trade policy. Such major forces can cause great stress as well as 
opportunities. To support rural Americans in adapting to change, three 
elements of human capacity development are proposed for fiscal year 
2000.
    (1) Professional work force preparation.--Aggressive approaches are 
needed to attract more people into the science and practices of 
American agricultural enterprises if they are to advance. Collaborative 
efforts between universities and private sector laboratories to provide 
internships can enhance interest and commitment to agricultural 
sciences. Study abroad experiences can attract graduates into 
international agriculture.
    (2) Work force transition.--The national work force preparation 
initiative coordinates federal, state, and local resources for 
extension, education, and research to address the training and 
retraining needs of youth and adults. Economic viability of rural 
communities with special emphasis on farm and ranch families is of high 
importance to maintaining the quality of life sought by rural citizens 
and communities. The initiative focuses on funding support for 
transitional educational opportunities for farm and ranch families, 
entrepreneurial job creation, small single-scale manufacturing, value-
added food processing, and others.
    (3) Technology transfer.--Availability of information useful to 
agricultural producers and practitioners has proliferated with 
increased access to technology. Greater attention should be given to 
the use and application of information and technologies that are 
readily produced by the global agricultural research system. Databases 
such as those maintained by NASA and the National Research Library 
should be evaluated as to their utility to the agriculture sector. 
Attention must be given to assisting users in the verification and 
management of information specific to their needs.
Children, Youth and Families at Risk: $1.0 million
    The national Children, Youth and Families at Risk initiative 
provides funding to Cooperative Extension Service programs in Land-
Grant Universities to develop community based projects that are 
designed to help at-risk audiences-both children and their families-
solve their own problems. Essential to the success of the projects is 
self-sufficiency. Federal support for the projects extends for a 
maximum of five years, with states contributing matching funds. This 
highly successful program addresses parenting skills, building family 
strengths, community leadership development, health and nutrition 
education, positive youth development, and more. The return on 
investment provided by this model program deserves strong continued 
support and enhancement.
Higher education: $14.750 million
    The Administration has proposed a mix of increases and some new 
programs in the area of higher education, particularly in the area of 
supporting the needs of minority communities. The Land-Grant 
Universities support these proposals. In addition, the Land-Grants have 
targeted much needed increases to the 1890 Institution Capacity 
Building Grant Program and the Institution Challenge Grants.
Conclusion
    Land-Grant Universities are key to the economic, environmental, and 
social health of our nation. We work one-on-one to help farmers, 
businesses, communities, and families thrive. We strive to help the 
United States provide the safest, most abundant, and most affordable 
food supply in the world. We do all of this in the context of a healthy 
and protected environment.
    With this budget proposal, we have identified the most urgent needs 
of the people we serve. We believe this mix of basic and competitive 
dollars, focused on these five priority areas, will best serve 
agriculture and the general public. Thank you for your consideration.
                                 ______
                                 
 Prepared Statement of the National Association of State Universities 
                        and Land-Grant Colleges
    Mr. Chairman, I am the Assistant Director of the International 
Agriculture at Cornell University. I am also the current the chair of 
the International Committee on Organization and Policy. I testify here 
in support of the fiscal year 2000 Agriculture Appropriations. Our 
committee is particularly interested in several programs. These 
include:
  --The proposed Competitive Grants program of USDA/CSREES for Global 
        Competitiveness. The goal of this program is to enhance U.S. 
        competitiveness in global markets through the development and 
        dissemination of information about markets, trade, non-tariff 
        trade barriers, and global agribusiness opportunities. The 
        Agricultural Research, Extension and Education Reform Act 
        (AREERA) of 1998 created a new competitive grants mechanism 
        specifically designed to address these and other tasks.
  --Markets, Trade & Rural Development program under the National 
        Research Initiative (NRI)
    This program supports the development of innovative research 
concepts and methods to enhance understanding of the global forces that 
affect the competitiveness of U.S. agricultural, aquacultural, and 
forest products sectors in domestic and international markets.
  --National Needs Competitive Grants program under Higher Education.
    This program supports strengthening of higher education curriculum 
and teaching. Increasingly, college graduates must be prepared to live 
and work in a global society. Internationalization of the undergraduate 
and graduate curricula through coursework and experiential learning is 
essential. This in turn requires faculty and staff development.
    By contributing to a better informed citizenry, these programs will 
increase U.S. capacity to compete in the global economy.
    The impact of current Asian economic turmoil on U.S. agriculture 
has demonstrated in dramatic fashion the need for sound, research-based 
understanding of global interdependencies. Studies to assess the impact 
of national and international public policy, the changing trends in 
comparative advantages across nations, and the causes and impacts of 
changing demand patterns are clearly critical to sound public policy 
and business decision-making. Universities are not only direct sources 
of high quality research in these areas, but serve as the training 
grounds for future government and private sector researchers.
    Between 1970 and 1995, the fraction of world agricultural 
production that moved through international markets more than doubled. 
The United States currently exports over thirty percent of its 
agricultural output, contributing significantly to the U.S. balance of 
payments. There is little reason to believe that the international 
marketplace will decline in importance for U.S. agriculture. U.S. 
farmers, food industries and consumers are increasingly aware of these 
trends. The result is a new set of stakeholder expectations for public 
universities. Land-grant universities across the country are 
responding, establishing as priority objectives the globalization of 
research, extension and teaching programs.
    In order to compete successfully in global and increasingly free 
markets, U.S. producers must continue their remarkable progress in 
improving production efficiency. Increasingly U.S. researchers find 
genetic resources and ideas to fuel this continued progress through 
collaboration with overseas scientists. Productivity gains, however, 
are no longer sufficient to maintain or improve market position. Better 
understanding of value added opportunities and international market 
dynamics are now a major determinant of successful competition. It is 
well known that other countries invest heavily to prepare their future 
public and private sector leaders to function in an interdependent and 
competitive world. Large enrollments of foreign students in the 
universities of the United States and Europe give compelling evidence 
of this. The U.S. needs to target investments in its own human capital 
that will better prepare graduates in the food and agricultural 
sciences for the global economy.
    The Global Competitiveness Grants, the National Research Initiative 
and the National Needs Competitive Grants (Higher Education) programs 
are designed to help us expand capacity to increase production and 
marketing efficiencies, and to extend them to users in the food system. 
The Globalizing Agricultural Science and Education Program for America 
(GASEPA) Agenda, which is sponsored by our Committee, focuses 
specifically on how to harness available land-grant university 
resources, including those to be provided through the above mentioned 
programs, to increase capacity to compete in global markets. Let me 
conclude with a brief review of the major components of the GASEPA 
Agenda.
    Under the GASEPA agenda, U.S. land-grant universities will work 
with various agencies of the U.S. Department of Agriculture to jointly 
internationalize our staff and programs. We will seek ways to use funds 
included in the above programs to promote these outcomes.
    The GASEPA agenda proposes to initiate and to strengthen globally 
relevant and useful agricultural teaching, research and outreach 
programs at land-grant and other qualifying institutions. Specific 
objectives are:
  --Enhancing global competitiveness of U.S. agriculture through human 
        resource development
  --Development and dissemination of information about market, trade 
        and business opportunities
  --Mutually beneficial collaborative global partnerships
  --Promoting trade through global economic development
  --Promoting global environmental quality and stewardship of natural 
        resources
    It is proposed that at least the first four of these objectives be 
funded through some combination of the three competitive grants 
mentioned at the beginning of this testimony. Each of these competitive 
grant programs will be administered by an agency of the U.S. Department 
of Agriculture. This framework will ensure that quality standards are 
maintained and that program activities are integrated with those of 
other related initiatives.
    Among the activities to be supported under the GASEPA agenda are 
those which will:
  --increase the international content of teaching programs;
  --provide university faculty and staff with cross-cultural, 
        professional experiences in areas related to their expertise;
  --increase the ability of faculty and staff to adapt agricultural 
        technologies developed overseas for use in the U.S.;
  --increase faculty, staff and student ability to support the 
        marketing of U.S. agricultural products and services overseas;
  --help U.S. agribusiness identify overseas opportunities; and
  --provide students in agriculture and related fields with study and 
        work experiences related to international competitiveness.
    Land-Grant universities must continue to reorient their higher 
education, research and extension programs to more effectively address 
the global dimensions of the agricultural industry. Our stakeholders 
expect it. The GASEPA agenda seeks to position U.S. agriculture as a 
major contributor to global food security well into the 21st Century.
    Thank you.
                                 ______
                                 
Prepared Statement of the National Association of University Fisheries 
                         and Wildlife Programs
    The National Association of University Fisheries and Wildlife 
Programs (NAUFWP) submits this statement on the proposed fiscal year 
2000 appropriations for the Cooperative State Research, Education, and 
Extension Services (CSREES), U.S. Department of Agriculture.
    Fifty-two universities hold membership in the NAUFWP. They seek to 
advance the science and practice of fisheries and wildlife ecology and 
management, and enhance public understanding of natural resources 
affairs.
    Members recognize that information from research and education 
outreach efforts of the CSREES and its Land Grant University partners 
help to build public understanding that stimulates uses of new 
technologies by private landowners, managers, community decision 
makers, and other segments of the general public. Significant benefits 
accrue to individuals, the states, and the nation by encouraging 
sustainable uses of the natural resource base, while simultaneously 
maintaining a competitive and profitable agricultural industry.
    With more than two-thirds of the U.S. lands, or approximately 1.35 
billion acres, owned or managed by more than 10 million private 
individuals, it is essential that the CSREES/Land Grant system be 
adequately funded. This long-standing partnership delivery system, with 
its grass roots credibility, must function more effectively in 
conveying important information to land managers and others. A 
continuous flow of reliable information is essential to encourage uses 
of the resource base that are ecologically sound, economically 
compatible, and socially acceptable. This approach is required to 
ensure that the natural resource base is used sustainably and yields 
multiple products, services, and values, including quality of life 
aspects for people.
    The NAUFWP is disappointed in the President's proposed fiscal year 
2000 budget. It lacks emphasis on natural resources research and 
education. For example, the major portion of CSREES's proposed budget 
is for production agriculture carried out by slightly more than 1 
million farmers. Only a very small amount ($3,192,000) is identified 
for the Renewable Resources Extension Act (RREA), which provides 
information and technical assistance to the more than 10 million 
private landowners and managers who handle most of the U.S. natural 
resource base. This proposed amount for RREA is inadequate and much too 
small a percentage of the total $948,012,000 proposed for the CSREES in 
fiscal year 2000.
    Natural resources, upon which our economy and quality of life are 
based, deserve much more attention and greater consideration. This 
statement focuses on needed realignments in the President's proposed 
fiscal year 2000 budget for CSREES. Five recommendations are provided 
by the NAUFWP.
    1. That the Renewable Resources Extension Act be allotted a minimum 
of $15 million in fiscal year 2000.
    RREA funds apportioned to State Extension Services leverage about 
four dollars from cooperating partners for each appropriated dollar. 
The major emphasis of this investment is to develop and disseminate 
practical, useful information to rural and urban landowners and 
managers. The recommended level of funding was originally authorized at 
$15 million annually. This level is needed to enable the Extension 
system to accomplish the goals and objectives set forth in the 1991-
1995 RREA Report To Congress.
    Needs for RREA information and educational programs are greater now 
than ever before. Parcels of private land are being fragmented into 
smaller units, there is greater diversity in landowners needing and 
requesting assistance, and the general public continues to be 
increasingly concerned about how land uses are carried out. Funding 
RREA at $15 million in fiscal year 2000 would permit the Cooperative 
Extension Service to expand its capabilities to assist more than 
500,000 private landowners and managers yearly in bolstering their base 
of information for carrying out their management and other activities 
on an estimated 35 million acres, while increasing productivity and 
revenue by $200 million.
    2. That Smith-Lever 3(b) & (c) base program funds should be 
increased by 9.0 percent to $280,951,000, with an appropriate portion 
of this increase designated for Extension's Natural Resource and 
Environmental Management Programs (NREM).
    The President's fiscal year 2000 proposal calls for a $18,795,000 
reduction for Smith-Lever 3(b) & (c) from the fiscal year 1999 level. 
This is inconsistent with the goal of enhancing information outreach to 
individuals with local needs.
    The 9.0 percent increase recommended by the NAUFWP would permit 
developing expertise and services at state and local levels to address 
existing and emerging natural resource concerns and problems 
encountered by small landowners and farmers in both rural and urban 
settings. Extension programs need to be strengthened, particularly on 
natural resource topics such as forest management, wetlands, threatened 
and endangered species, and wildlife/human interactions. The designated 
portion of the 9.0 percent increase would be instrumental in improving 
landowner understanding of changes and opportunities in conservation 
provisions of the 1996 Farm Act and to enhance range management.
    The NAUFWP strongly recommends that close cooperative working 
relations be strengthened among representatives of State Extension 
Services, State Fish and Wildlife Agencies, conservation organizations, 
and others. More team efforts are needed. One of increasing interest 
and value is the Extension 4-H youth natural resource program, with 
more than 1,350,000 youngsters from both urban and rural communities 
presently enrolled. Enrollments for this fundamental, popular program 
continue to increase.
    Increased Smith-Lever 3(b) & (c) funds, with appropriate targeting, 
would assist CSREES in carrying out its essential education and service 
programs, and help meet its NREM National Strategic Plan obligations, 
nationwide.
    3. That the Rangeland Research Grants budget be restored to 
$500,000 for fiscal year 2000.
    In view of the pressing needs to improve management of rangelands, 
it is disappointing to see this Administration fail to recognize and 
fund the Rangeland Research Grants Program. More than one-half of the 
U.S. land area is rangeland, most of which requires increased attention 
and management, especially to restore and maintain watershed integrity, 
fish and wildlife, and outdoor recreational opportunities. Providing 
$500,000 in fiscal year 2000 would reestablish interdisciplinary 
research and education programs to help landowners and managers restore 
and perpetuate multiple products, services, and values from these 
extensive lands.
    4. That an appropriate portion of the total increased appropriation 
for Pest Management be dedicated to educational programs focused on 
preventing and controlling vertebrate pests in urban and rural 
communities, and to address invasive exotic species and noxious weed 
problems on rangelands.
    Funds are required to restore, manage, and sustain the ecological 
integrity of the nation's resource base, upon which the economy and 
quality of life are based. Regrettably, the President's proposed fiscal 
year 2000 budget, with substantial increases for Pest Management ($15.5 
million) and the National Research Initiative ($48 million for plant 
and animal research), lacks opportunities to address vertebrate pests. 
This void needs attention now, to help agricultural producers and other 
private landowners address vertebrate pests and invasive species, which 
are the most prevalent problems they encounter in many states.
    Targeting a sizeable percentage of Pest Management funds for 
research and educational programs is needed to enhance the 
understanding and capabilities of landowners and managers to curtail 
damages from vertebrate pests and invasive species. It also would 
enable the CSREES and its Land Grant partners to respond more 
effectively to the recent Presidential Executive Order on Invasive 
Species (1999-20-03).
    5. That Hatch Act funds be restored at least to the fiscal year 
1999 level ($180,545,000), McIntire-Stennis be funded at least to $30 
million for fiscal year 2000, and proposed increased funds for the 
National Research Initiative (NRI) Competitive Grants be reevaluated.
    The NAUFWP is deeply concerned over the proposed fiscal year 2000 
decrease in funds for the Hatch Act (-$26,873,000) and McIntire-Stennis 
Cooperative Forestry program (-$2,050,000). These proposed cuts are 
inconsistent with recognized needs for research and information to 
address natural resource problems, and to respond to the needs of more 
than 10 million private landowners and managers. These cuts should not 
be made.
    The NAUFWP is pleased that the President's proposed fiscal year 
2000 budget carries a $12,500,000 increase over fiscal year 1999 for 
NRI research under the category Natural Resources and the Environment. 
It is recommended that these funds, as well as others, be aligned to 
address critical natural resource research and information needs, such 
as those of private landowners and managers. Much greater attention and 
more funds should be focused on CSREES Strategic Goal 4: Greater 
Harmony Between Agriculture and the Environment. Soil erosion, water 
quality, excessive nutrient enrichment, contaminants, and effects of 
agricultural chemicals on living organisms warrant prompt attention and 
investment of research, information, and Extension funds. The U.S. land 
and water base must be maintained in a healthy, productive status.
    In summary, the National Association of University Fisheries and 
Wildlife Programs recommends the following realignments in the 
President's proposed fiscal year 2000 budget for CSREES.
    1. That the Renewable Resources Extension Act be fully funded at 
$15 million.
    2. That Smith-Lever 3(b) & (c) base program funds be increased by 
9.0 percent to $280,951,000, with an appropriate portion of this 
increase designated for Extension's Natural Resource and Environmental 
Management Programs.
    3. That Rangeland Research Grants be restored to $500,000.
    4. That an appropriate portion of the total increased 
appropriations for Pest Management be dedicated to research and 
education programs to address prevention and control of vertebrate 
pests, and problems associated with invasive exotic species and noxious 
weeds.
    5. That Hatch Act funds be restored at least to the fiscal year 
1999 level, McIntire-Stennis Cooperative Forestry be funded at least to 
$30 million, and proposed increased funds for the National Research 
Initiative Competitive Grants be revaluated, with more funds aligned to 
address critical natural resource research and information needs, such 
as those of private landowners and managers.
    Please include this statement in the official record on the fiscal 
year 2000 appropriations. Your positive response will be appreciated 
very much.
                                 ______
                                 
   Prepared Statement of the National Center for Resource Innovations
    As ever, we appreciate this opportunity to provide testimony to the 
Senate Appropriations Subcommittee on Agriculture, Rural Development 
and Related Agencies.
    The National Center for Resource Innovations (NCRI) was established 
in 1990 through a joint private/federal initiative in an appropriation 
to USDA's-Cooperative State Research, Extension and Education Service 
(CSREES). The consortium now includes seven sites (including one added 
last year at the Southwest Indian Polytechnic Institute, Albuquerque, 
NM) and an administrative office in Rosslyn, Virginia. Each site in the 
consortium contributes unique expertise to this national program. NCRI 
capabilities include integration of large data sets in a Geographic 
Information Systems (GIS) framework from the national level down to the 
farm field as well as weather analysis, land use planning, resource 
management at state and local levels, and support for public and 
private policy development.
The mission of NCRI
    The mission of NCRI is to provide collaborative and innovative 
transfer of geographic information systems technologies to support 
local government and other public policy development and decision 
making.
NCRI funding history, matching funds and cost effectiveness
    In the past, NCRI has consistently requested $1.8 million annually 
for minimum program operations. Grants have been awarded from funds 
appropriated as follows: fiscal year 1990, $494,000; fiscal year 1991, 
$747,000; fiscal year 1992 and 1993, $1,000,000; fiscal year 1994, 
$1,011,000; fiscal year 1995, $877,000; fiscal year 1996, $939,000; 
fiscal year 1997 and 1998, and 1999: $844,000.
    NCRI has either matched federal funds or had to reduce program 
objectives. The total non-federal support generated for fiscal years 
1990 to 1998 was in excess of $5,500,000. The total federal 
appropriated amounts for the same period were $8,600,000. In fiscal 
year 1997, NCRI prepared, at the request of Congressman Skeen's office, 
a cost-benefit study. Results showed that for every federal dollar 
invested, $7.40 in benefits through innovative projects was realized.
NCRI site expertise and accomplishments
    The advantage of the consortium of seven regional centers that 
makes up NCRI is that each site has unique expertise and shares 
technical support with other sites. In this way, projects are 
strengthened through shared resources and the experience needed to 
build complex and comprehensive information systems. Site-to-site 
technology transfer and networking build NCRI's overall capabilities, 
aids in problem solving and facilitates consistency.
                     joint activities (seven sites)
    All of the NCRI sites plan engaged in two major collaborative 
activities this year: a DISTANCE LEARNING PROGRAM broadcast at the 
Southwest Indian Polytechnic Institute site March 4th and a RESOURCES 
TECHNOLOGY FAIR on Capitol Hill held on March 22nd, 1999 in the House 
Science Committee Room. Congressmen and Senators were invited to act as 
sponsors for the fair, which will include exhibits by the seven NCRI 
sites as well as by federal agencies and private sector companies who 
have been partners in technology implementation with NCRI sites.
 ncri--great lakes university of wisconsin-madison, madison, wisconsin
    The NCRI-Great Lakes project site is located at the Land 
Information and Computer Graphics Facility (LICGF) in the College of 
Agriculture at the University of Wisconsin. The Facility was instituted 
in 1993 to function as a research, teaching, and outreach resource in 
land and geographic information systems (LIS/GIS). Researchers at LICGF 
explore uses of LIS/GIS for local and regional land and resource 
planning to support social, economic, and environmental decision making 
processes.
    During 1999-2000, NCRI-Great Lakes has established the following 
objectives:
  --Conduct seminars for the Wisconsin Land Council to develop citizen-
        based land use planning and the use of Land Information 
        Systems. Effectiveness of this approach will be assessed.
  --Support Wisconsin State Legislature in GIS needs, Research and 
        Prototyping of Wisconsin Administrative Boundaries.
  --Accelerate the use of GIS technology by governments with coastal 
        zone jurisdictions.
  --Work with the State of Wisconsin on the 2000 Census and its 
        implementation.
               ncri--chesapeake, inc., rosslyn, virginia
    NCRI-Chesapeake builds cooperative integrated information systems 
``from the nation to the neighborhood'' with federal and state 
agencies, universities and others to provide new information for better 
decision-making. These systems focus first, on the farm, productivity 
and the farmers in their own very specific neighborhoods as related to 
natural systems and their socio-economic position in the landscape. 
NCRI-Chesapeake has established the following goals for 1999-2000:
  --Continuing to expand through Internet research descriptions of 
        impacts of animal manure on water quality, evaluation of agro-
        ecoindices, and assessment of watershed priorities.
  --Assist citizens in becoming involved in planning future growth in 
        North Carolina, the Washington-Baltimore metropolitan area and 
        other urbanizing areas of the country regarding the impact of 
        urban sprawl on ecosystems.
  --Cooperate with EPA in defining ecologically sensitive resources 
        potential affected by furze growth.
 ncri--northwest, central washington university, ellensburg, washington
    NCRI-NW continues to concentrate on the local and regional resource 
issues of the Yakima Valley and eastern Washington. These issues 
include irrigation of agricultural lands, county planning needs, Native 
American interests, and the management of inter-mixed public and 
private lands. The site works in close cooperation with the faculty and 
staff of Central Washington University as well as the GIS lab.
    NCRI-NW plans for 1999-2000 include:
  --Work with the Natural Resources Conservation Service to speed the 
        delivery of digital soils maps to GIS users, precision farmers, 
        and others.
  --Initiate a study for the U.S. Bureau of Reclamation on the Yakima 
        River Floodplain.
  --Continued assistance to the Kittitas Reclamation District for data 
        development and data exchange.
    ncri--south west, university of arkansas, fayetteville, arkansas
    NCRI-SW has been based at the University of Arkansas at 
Fayetteville since its inception in May of 1990. Through university 
support and hardware and software grants, the program has a fully 
equipped research, training, and outreach facility capable of 
demonstrating a wide range of software for geographic information 
systems, remote sensing, spatial statistics, and database management. 
In the fall of 1994, expansion of Center facilities was completed to 
include five state-of-the-art teaching and research laboratories, ten 
offices, and a library/reading room. A variety of advanced computer 
equipment now facilitates the center's teaching, outreach, and 
cooperative project capabilities. NCRI-SW continues to focus on 
technology transfer through training, the development of statewide GIS 
databases and representative projects demonstrating the cost benefits 
and efficiency of GIS technology.
    NCRI-South West has proposed the following objectives among those 
to be achieved in 1999-2000:
  --Provide technical support to the Arkansas Land Records 
        Modernization Board as well as serving as a member of the 
        Board.
  --Participate with a consortium of private and public sector partners 
        to initiate the Seamless Warehouse of Arkansas Geodata (SWAG) 
        so that users will be able to access any selected area of the 
        state with the data provided over the net in OGC Simple 
        Features Format.
  --Expand base of county and local government staff who are 
        knowledgeable as to benefits and costs for GIS technologies.
  ncri--north central, university of north dakota, grand forks, north 
                                 dakota
    NCRI-NC's interdisciplinary research and technology transfer 
programs are located and supported at the University of North Dakota 
Regional Weather Information Center. From this facility, NCRI-NC is 
linked to the UND Aerospace Scientific Computing Center which houses a 
CRAY 190. The resource issues in the region are related to the 
enhancement and protection of farming and ranching, which are principal 
contributors to the region's economy. The work performed by NCRI-NC and 
the Regional Weather Information Center has resulted in their being 
recognized by the Ford Foundation as a semifinalist in the 1995 
Innovations in American Government Awards Program.
    During 1999 and 2000, NCRI-NC has set the following objectives:
  --Disseminate GIS technology to local, county and state agencies in 
        the North Central region.
  --Intergate weather and climate data into the GIS environment.
  --Provide support for agricultural datasets and methods in GIS 
        practices.
ncri--south east, south georgia regional development center, valdosta, 
                                georgia
    NCRI-SE's program is an integral component of the South Georgia 
Regional Development Center--a regional agency that supports local 
governments across ten counties. NCRI-SE's primary objective is to 
encourage the use of geographic information for ecologically 
responsible decisionmaking in this primarily rural region. ``Real 
world'' presentations by NCRI-SE using actual local geographic data 
have proven to be an effective method of demonstrating the value of 
GIS. This, coupled with the experience gained by NCRI-SE personnel from 
implementing GIS for local governments, has proven invaluable to 
government managers in the South East region. NCRI-SE also provides 
direct technical and ``hands on'' advice and training for any regional 
entities working in the GIS realm.
    NCRI-SE's goals include:
  --Demonstrate the value of GIS to local governments using information 
        that applies directly to their own situations, using the 
        existing regional database and GIS applications built by NCRI-
        SE.
  --Provide leadership in the GIS development process by promoting 
        local government cooperative agreements in order to increase 
        involvement and defray costs, and to promote standards that 
        allow simple transfer of GIS data among state, local and 
        federal agencies.
  --Continue to refine data and databases for regional wetlands.
    southwest indian polytechnic institute, albuquerque, new mexico
    NCRI-SIPI is the newest of the NCRI sites, having been added in 
1997. SIPI is a National Indian Community College, funded by the 
federal government. Nearly 50 percent of all American Indians live 
within a 500-mile radius of the school. SIPI's overall objective is to 
provide technology transfer through distance education in conjunction 
with the development of precision farming on the SIPI campus and on 
Indian reservation lands in New Mexico and southern Colorado.
    For fiscal year 1999-2000, SIPI has the following objectives:
  --Provide leadership, support and direction to advocates, 
        practitioners and users of geo-spatial predicts and services.
  --Expand the base of county and local government staff who are 
        knowledgeable as to benefits and costs for GIS technologies.
  --Offer GIS and GPS training/short courses locally for tribal 
        personnel.
                               conclusion
  --The current level of funding for NCRI (fiscal year 1998) is 
        $844,000. We request that the level of funding through USDA/
        CSREES be restored to $1.2 million for fiscal year 2000. For 
        the past two years, NCRI has provided SIPI with $50,000 of its 
        own funds. The requested funds would provide uniform funding 
        levels for all sites.
    The NCRI Consortium appreciates this opportunity to provide 
testimony to the Senate Appropriations Subcommittee on Agriculture, 
Rural Development and Related Agencies.
                                 ______
                                 

Prepared Statement of the National Commodity Supplemental Food Program 
                                 (CSFP)

    Mr. Chairman and subcommittee members, I am Frank Kubik, President 
of the National Commodity Supplemental Food Program (CSFP) Association. 
Our association of state and local CSFP operators work diligently with 
the Department of Agriculture Food, Nutrition, and Consumer Service to 
insure a quality supplemental nutrition assistance commodity food 
package program for elderly men and women, and mothers, infants, and 
children. The program which was authorized in 1969 serves 412,000 
individuals every month in 19 states and the District of Columbia.
    This 30 year old CSFP program stands as testimony to the power of 
partnerships between community-based organizations, private industry 
and government agencies. The CSFP offers a unique combination of 
advantages unparalleled by any other food assistance program.:
  --The CSFP specifically targets our nation's most vulnerable 
        populations: the very young and the very old.
  --The CSFP provides a monthly selection of foods specifically 
        tailored to the nutritional needs of the population we serve. 
        Each eligible participant in the program is guaranteed [by law] 
        a certain level of nutritional assistance every month.
  --The CSFP purchases foods at wholesale prices which amounts to \1/3\ 
        the cost it would be to provide the same supplemental nutrients 
        at retail voucher cost. The average food package cost for 
        fiscal year 1999 is $15.44 and retail cost would be at least 
        $50.
  --The CSFP involves the entire community in the problems of hunger 
        and poverty. Thousands of volunteers as well as many private 
        companies donate money, equipment, and most importantly time to 
        deliver food to homebound seniors. These volunteers not only 
        bring food but companionship and other assistance to seniors 
        who might have no other source of friendship.
  --For these historical reasons I would like to submit the National 
        CSFP Association legislative issues and a report of our 1998 
        survey of monthly volunteer labor hours to support our 
        requests.
    Chairman Cochran, the committee has consistently been helpful with 
funding support for our very prudent way of providing nutritional 
supplements to the seniors and mothers and children. Please help us 
continue.
                  legislative issues fiscal year 2000
    Position: The CSFP Association recommends an appropriation of $95 
million for fiscal year 2000. This would increase the budget figure of 
$90.2 million. The increase is necessary for:
  --a new state program
  --additional caseload for existing programs
  --adjustment for state/local support funding
    Reasons:
  --CSFP is a very effective food delivery system. According to USDA 
        FNS the average cost of a food package is $16. The average 
        retail value of those foods distributed by grassroots community 
        organizations is $50-$60. Our 1998 survey of monthly volunteer 
        labor hours shows we have at least $390,400/month donated to 
        stretch support funding for the program.
  --The proposed funding for CSFP includes the transfer of $6 million 
        in food inventory for total program support for fiscal year 
        2000. This mix of funds and inventory will result in a decrease 
        of $1.2 million in state/local support funding due to 
        computation on funds not total program assets.
  --There are requests from existing programs for 20,000 additional 
        caseload slots and one new state has a approved plan for a 
        pilot program of 5,000 slots.
    Position: With the aging of America, CSFP should be an integral 
part of USDA Senior Nutrition Policy. This is the most cost effective 
way to provide the nutrient rich foods that low income seniors are 
lacking.
    Reasons: The advantages of CSFP include:
  --The food box for seniors is nutritionally balanced.
  --Supplemental nutrition is proven to reduce public health care 
        costs.
  --Nutrition education is provided.
  --Food is distributed through community and faith based 
        organizations, familiar to many seniors.
  --Seniors resist participation in programs such as food stamps, but 
        readily access commodity programs.
  --CSFP requires a means test that assures participants are truly 
        needy.
  --Actual food is provided to those who need it most.
  --CSFP supports United States farmers.
  --Program operators utilize volunteers and other in-kind donations to 
        reach homebound seniors.
  --Food boxes are valued at approximately $50-$60 retail and only cost 
        USDA $15.44.

                                             NATIONAL COMMODITY SUPPLEMENTAL FOOD PROGRAM (CSFP) SURVEY 1998
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   Fixed                 Mobile                Volunteer                Volunteer    Dollars     Square
                      State                        Sites  Participants   sites   Participants    sites    Participants    hours       value      miles
--------------------------------------------------------------------------------------------------------------------------------------------------------
New Hampshire....................................      3        2,000        86        7,200          5          137          114      $1,566      9,304
New York.........................................      9       26,302        57        1,319   .........  ............        142       1,951      3,700
Wash. D.C........................................      5        7,718         4          792         13        2,143          519       7,131         63
Kentucky.........................................      1        5,300   .......  ............        23          700          600       8,244        750
North Carolina...................................      1        1,036         8          314   .........  ............  .........  ..........        500
Tennessee........................................      4       14,324         3        4,400   .........  ............  .........  ..........      1,850
Illinois.........................................     12       13,285   .......  ............        72        5,972         3915      53,792         36
Michigan.........................................     22       47,170       102       21,688        366       14,173        5,922      81,368     58,527
Red Lake MN......................................      1          325   .......  ............  .........  ............  .........  ..........    ( \1\ )
Minnesota........................................      2        2,822        83        5,994   .........  ............        504       6,925     84,068
Louisiana........................................     10       22,824        33       18,241        208       28,460        1,779      24,443     27,928
New Mexico.......................................      4       11,353        37        6,185         19          969        1,194      16,406     42,806
Colorado.........................................      9       19,180        32        1,714         61        2,090        1,632      22,424     18,656
Iowa.............................................      1        3,064        37        1,028         13          579          450       6,183      3,600
Kansas...........................................      9        2,185        24        1,175         62        1,192          640       8,794        N/A
Nebraska.........................................     22        8,923        85        3,457         49        1,536        1,417      19,470     74,866
South Dakota.....................................      2          461         3           69   .........  ............  .........  ..........    ( \1\ )
Arizona..........................................     16        5,995   .......  ............        67       14,179        1,122      15,416     80,000
California.......................................  .....  ............       45       28,175         72        3,863        8,154     112,036      3,697
Oregon...........................................      1          712   .......  ............  .........  ............        310       4,259         75
                                                  ------------------------------------------------------------------------------------------------------
Totals...........................................    134      194,979       639      101,751      1,030       75,993       28,414     390,408   410,426
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Reservations.
 
FIXED SITE: Foods are warehoused and participants travel to the site and take food packages back to their homes. Distributed to participants by paid
  staff.
MOBILE SITE: Distribution where foods are transported to a facility (not warehoused) and distributed to participants by paid staff.
VOLUNTEER SITE: Location where distribution of prepacked foods is performed by volunteer groups or individuals.

     Prepared Statement of the National Conservation Buffer Council
    The National Conservation Buffer Council and its sponsoring 
organizations urge you to give high priority to conservation and 
environment programs in the fiscal 2000 agricultural appropriations 
bill.
    NCBC is a private-sector, nonprofit organization formed to advocate 
agricultural conservation practices, especially the family of practices 
known as buffers, so as to protect water quality and reduce future 
regulatory burdens on farmers and ranchers.
    We hope to help encourage the establishment of two million miles of 
buffers on private agricultural lands by 2002.
    Such an ambitious goal can only be achieved through a vigorous 
private-public partnership with the Department of Agriculture--
especially the Natural Resources Conservation Service--and the 
continued availability of the department's incentive programs and 
technical assistance to landowners. To those ends, we ask that you 
consider the following recommendations regarding fiscal year 2000 
appropriations:
    Environmental Quality Incentives Program.--NCBC supports the 
Administration's request for an additional $100 million in funding for 
EQIP. This addition is critical to meet the overwhelming demand for the 
program's cost-share and incentive payments and technical assistance--
demand which, it should be noted, stands to only increase as additional 
requirements such as the Administration's Animal Feeding Operation 
strategy and various state-level water quality regulations come on 
line.
    With these new environmental challenges for agriculture so 
obviously on the horizon, it was extremely disheartening that EQIP 
funding was actually reduced for fiscal year 1999. At the very least, 
no cuts to EQIP should be made in the future.
    Conservation Reserve Program.--Wetlands Reserve Program CRP and WRP 
are major sources of incentives for buffer establishment. We request 
that no restrictions on enrollments be enacted in fiscal year 1999.
    The CRP continuous signup stands to be the most lucrative program 
in many regions. However, participation in this option has been 
limited. Our extensive contacts in the field suggest this is due in 
part to several obstacles, including indifference of USDA personnel in 
some counties toward the continuous CRP, inconsistent application of 
program guidelines nationwide, and insufficient payment rates in some 
areas. We would appreciate direction from your subcommittee to the 
Secretary to remedy these barriers.
    NRCS operations.--The agency's own workload analysis, based on 
expectations of demand for technical assistance connected with the 
environmental challenges mentioned above, suggests that the staffing 
levels provided for in the Administration's own fiscal year 2000 budget 
will leave NRCS about 1,000 person-years short of what will be needed. 
This assistance is critical, especially for landowners with limited 
resources. NCBC urges the subcommittee to carefully consider the 
critical technical assistance needs of farmers and ranchers when 
setting the funding level for NRCS. At this juncture, we would also 
register our concern about the limitations on NRCS technical assistance 
for development of CRP conservation plans that have arisen as a result 
of the 1996 farm bill's amendment to Section 11 of the Commodity Credit 
Corporation charter act. As you are aware, this is an issue with 
respect to both the fiscal year 2000 agricultural appropriations bill 
and the fiscal year 1999 supplemental appropriations measure. We 
request your support for an exemption of conservation programs from the 
so-called Section 11 cap on reimbursable agreements, especially since 
conservation technical assistance was not among those agreements in 
fiscal year 1995 that are the basis for the cap.
    Alternatively, we would ask that you urge the Secretary to expedite 
the process for contracting outside the Department for the technical 
assistance necessary to allow the CRP enrollments to progress 
unhindered.
    Thank you for your consideration of our recommendations. I would be 
happy to discuss these points, especially the suggestions of direction 
to the Department, with you or your staff.
                                 ______
                                 
  Prepared Statement of the National Cooperative Business Association
    Mr. Chairman, members of the committee, we appreciate the 
opportunity to present testimony as you prepare to consider 
appropriations for the Department of Agriculture for fiscal year 2000. 
I would like to discuss the Grants for Rural Cooperative Development 
program and the centers for cooperative development receiving funding 
from the program. I urge you to appropriate at least the President's 
budget amount of $5 million for this valuable program that is offering 
real solutions to the daunting challenges being faced in rural America.
    The National Cooperative Business Association (NCBA) is proud of 
its role in assisting the creation of a network of rural cooperative 
development centers across the country. We know that Congress is 
equally as proud of its role in fostering a cooperative business 
development support network throughout rural America. Congress and this 
Administration recognize the vital role that cooperatives play in 
providing jobs, increasing incomes and reducing expenses for millions 
of rural Americans.
    The Grants for Rural Cooperative Development program was originally 
authorized by section 2347 of the 1990 farm bill as a program of Grants 
for Technology Transfer and Cooperative Development. In fiscal year 
1993, this committee began to provide funding for the program, and 
report language over the years has indicated your strong support for 
the concept of using this funding for the purpose of creating a network 
of centers for rural cooperative business development. While the 
centers offer technical assistance, information and other resources for 
cooperative business formation, their network provides a vital support 
system for the centers to continue operating.
    NCBA's members, along with other supporters of cooperatives around 
the nation, joined together as the National Rural Cooperative 
Development Task Force to advocate for support for a national network 
of centers and to develop the linkages among the centers and between 
the centers and local partners to sustain the network's development. 
NCBA is now working with these regional centers that provide vital 
technical assistance and support for the development of cooperative 
enterprises in rural America. NCBA also signed a partnership agreement 
in 1997 with USDA's Cooperative Services program to coordinate 
strategies to assist rural cooperative development.
    In 1996, Congress demonstrated its strong commitment to the centers 
approach when it passed the FAIR Act, also known as the 1996 farm bill. 
The program is now called Grants for Rural Cooperative Development in 
section 747(c)(4) of Public Law 104-127. The program focuses on 
supporting ``nonprofit institutions for the purpose of enabling the 
institutions to establish and operate centers for rural cooperative 
development.'' It is authorized to provide funding at $50 million per 
year. The revised statutory language defines the goals of these centers 
as ``facilitat[ing] the creation of jobs in rural areas through the 
development of new rural cooperatives, value added processing, and 
rural businesses.''
    With the support of funding received from the program over the past 
few years, the rural cooperative development centers have demonstrated 
quantifiable results. The National Network of Centers that NCBA works 
with has established more than 50 value-added cooperatives serving in 
excess of 5,000 members. These centers have created or saved 16,500 
jobs in the communities they serve. They have assisted more than 400 
local communities and organizations. The centers have raised the 
quality of technical assistance being provided on cooperative 
development, they have developed significant information-sharing 
capability among their network and created the first report of best 
practices in the field of cooperative development.
    This coming year, centers will be involved in replicating successes 
they have achieved and breaking new ground in areas where cooperative 
development is needed. The electricity industry is rapidly being 
deregulated in every part of the country. Consumer-owned rural electric 
cooperatives have provided reliable and affordable electricity to rural 
Americans since the rural electrification program began directing 
federal resources for them in the 1930s. Once again, a small federal 
investment can provide essential assistance to develop consumer-owned 
energy purchasing cooperatives so that Americans are able to provide 
themselves with access to electricity. By pooling the purchasing power 
of many small consumers, cooperative businesses give their members the 
same bargaining power as large users of electricity. Centers are 
working with rural Americans to create and build these self-help 
enterprises.
    Other cooperative development projects include the formation of new 
value-added agricultural cooperatives, new child care cooperatives, and 
cooperative housing projects. Value-added agricultural cooperatives 
give farmers more of the consumer dollar. Child care cooperatives 
provide former welfare recipients and other low-income people the 
opportunity to reduce the cost of child care and give them control over 
how their child care facilities are operated. Cooperative housing gives 
seniors and others in rural areas the chance to save money on their 
housing and live in safe communities.
    The President's budget includes $5 million for this program. This 
is a significant increase in funding from prior years, demonstrating 
the Administration's acknowledgement of the value of this program. 
USDA's National Commission on Small Farms recently recommended that 
this program ``be increased by $10 million annually up to $20 
million.'' The Commission's report calls the program ``one of the few 
that supports rural cooperative development at the grassroots level.'' 
The program is authorized to be funded at $50 million annually.
    We urge this committee to do what over 100 organizations from 
around the country are urging Congress and the Administration to do: 
increase funding for this valuable program. Mr. Chairman, I ask that 
the letter signed by those organizations be included in the record of 
this hearing along with my testimony.
    NCBA is a national membership association representing 
cooperatives--over 120 million Americans and 47,000 businesses ranging 
in size from small buying clubs to businesses included in the Fortune 
500. NCBA's membership includes cooperatives in the fields of housing, 
health care, finance, insurance, child care, agricultural marketing and 
supply, rural utilities and consumer goods and services, as well as 
associations of cooperatives. NCBA brings its members together to 
provide business opportunities and to develop, advance and to protect 
cooperative enterprise.
                                 ______
                                 

      Prepared Statement of the National Corn Growers Association

    The National Corn Growers Association (NCGA) appreciates the 
opportunity to provide the subcommittee with corn growers' 
recommendations regarding fiscal year 2000 appropriations for key 
programs administered by the U.S. Department of Agriculture. NCGA 
represents 30,000 corn growers in 48 states and the association's 
mission is to create and increase opportunities for corn growers in a 
changing world and to enhance corn utilization and profitability.
                            genomic research
    For the fiscal year 2000 agricultural appropriations bill, NCGA 
supports the Administration's budget request for an increase of $1.8 
million for plant and animal genetic resources at the Agricultural 
Research Service (ARS). We believe, however, that this amount should be 
increased significantly to ensure that the ARS has sufficient resources 
to participate fully in the ongoing genomics revolution. NCGA was 
disappointed that the Administration's Information Technology proposal 
did not include the ARS and that the Administration is no longer 
proposing a new, competitive grants program for Food Genomics. NCGA 
supports efforts to ensure that the $120 million in funding for the 
Initiative for Future Agriculture and Food Systems is utilized for 
agricultural research and, in particular, for a significant plant and 
animal genomics program at the USDA.
    While many federal agricultural programs are important to the 
nation's corn growers, NCGA believes that the future of the corn 
industry is written in corn's genetic code and that plant genomics will 
give us the fundamental information necessary for biotechnology to 
revolutionize American agriculture. NCGA concurs with Philip H. 
Abelson's statement, in a 1998 editorial, that we are in the early 
phases of the third technological revolution--a genomics revolution--
and that `` * * * the greatest ultimate global impact of genomics will 
result from manipulation of the DNA of plants.'' (Science, Vol. 279, p. 
2019.) Thus, NCGA believes that the most important appropriations issue 
for fiscal year 2000 is funding for coordinated, plant genomics 
research. Genomics consists of mapping, sequencing and analyzing 
genomes to determine the function of genes. Plant genomics research 
advances our understanding of the structure, organization and function 
of plant genomes. The complete genetic makeup of any organism is known 
as its genome.
    In January 1998, the National Science and Technology Council issued 
an Interagency Working Group report on the National Plant Genome 
Initiative. The report stated that the time was right for the 
implementation of a comprehensive, five-year National Plant Genome 
Initiative to meet the major challenges that will face mankind in the 
21st Century. In the transmittal letter accompanying the report, the 
President's science advisor, Dr. John H. Gibbons, stated the following:

          The timing of this initiative is critical, since our 
        international and private sector partners are moving forward 
        aggressively. A significant public sector program * * * carried 
        out in partnership with industry will ensure plant genome data 
        and materials are openly accessible to all scientists. It is a 
        critical step toward promoting future scientific breakthroughs 
        in plant biology and their practical application.

    To accomplish the short-term goals of the National Plant Genome 
Initiative that focus on building plant genome research infrastructure, 
the Interagency Working Group on Plant Genomes estimated that $400 
million in funding was needed, over five years, to meet the anticipated 
needs of the Initiative. For fiscal years 1998 and 1999, $90 million 
was provided for the National Science Foundation Plant Genome 
Initiative. Without a significant plant genomics investment from the 
USDA, it will be difficult, if not impossible, to achieve the level of 
federal funding necessary to fulfill the short-term goals of the 
National Plant Genome Initiative. Thus, NCGA strongly supports 
increases for the plant genomics program at the ARS and supports 
increases in competitively awarded plant genomics funding. The 
Administration's budget request is inadequate for both the short-term 
and long-term goals of the National Plant Genome Initiative.
    The National Plant Genome Initiative will help scientists, 
geneticists and plant breeders identify and utilize genes from corn and 
other economically significant crops that control important traits, 
such as nutritional value, stress tolerance and resistance to pests. 
The far-reaching benefits of this Initiative include:
  --protection of U.S. interests and access to important biotechnology 
        and gene patents;
  --revitalization of rural America due to a more robust agricultural 
        sector;
  --expansion of plant-based renewable resources for energy and raw 
        materials;
  --significant reductions in crop losses and reliance on pesticides 
        through improved biological methods to control and alleviate 
        serious industrial threats and targeted pests;
  --improved yields and reduced crop losses caused by adverse 
        environmental conditions such as heat, drought and salt;
  --improved nitrogen-use efficiency, thereby, limiting the potential 
        for nitrates in the water supply;
  --reduced environmental problems confronted by livestock producers, 
        such as modifying the digestibility of phosphorous in feed corn 
        to reduce the amount of phosphorous that enters our ground 
        water;
  --improved animal nutrition leading to healthier meat and increased 
        meat productivity;
  --reductions in the occurrence of mycotoxin contamination by 
        significantly improving resistance to fungal infection;
  --the development of tailored hybrids with valuable specialty 
        starches, oils and protein content; and
  --reduced worldwide malnutrition due to higher yielding and more 
        nutritious crops.
    The National Plant Genome Initiative is critical to the long-term 
viability of U.S. agriculture. To compete in the global market, the 
U.S. must continually strive to efficiently and economically improve 
production capabilities--to maximize yield and combat serious threats 
from disease, pests and climate changes--without harming the 
environment. Genomics research holds the key to achieving this goal.
    The NCGA, also, understands that the American Seed Trade 
Association (ASTA) is requesting a $5 million increase for the National 
Plant Germplasm System (NPGS). The NCGA concurs with ASTA that the NPGS 
is a fundamental, strategic resource. Access to diverse genetic 
resources that are well maintained by the NPGS is essential to the 
future of agricultural biotechnology. Thus, the NCGA supports the 
request for a $5 million increase for the NPGS.
    The NCGA urges Congress to provide increased funding for plant and 
animal genomics research and plant germplasm research at USDA to ensure 
that our growers have the tools to meet the challenges and demands of 
the 21st century.
                      market development programs
    The Market Access Program (MAP) and Foreign Market Development 
Cooperator Program (FMD), both administered by USDA's Foreign 
Agricultural Service (FAS), help promote access to key overseas markets 
for U.S. agricultural products, including corn and value-added corn 
products.
    MAP uses funds from the Commodity Credit Corporation (CCC) to 
reimburse a portion of the costs of carrying out overseas marketing and 
promotional activities, such as direct consumer promotions, market 
research, technical assistance, and trade servicing. MAP participants 
include nonprofit agricultural trade organizations, State regional 
trade groups, cooperatives, and private companies that qualify as small 
business concerns. Historically, more than 80 percent of MAP funding 
has been devoted to building export markets for U.S. high value 
agricultural products.
    FMD, also known as the Cooperator Program, seeks to develop long-
term export markets for generic U.S. agricultural commodities. For more 
than 40 years, FMD has fostered a trade promotion partnership between 
USDA and U.S. agricultural producers and processors who are represented 
by nonprofit commodity or trade associations called cooperators. By 
providing cost-share assistance and the opportunity to work closely 
with FAS and its overseas offices, FMD has mobilized private sector 
support and funding for market development activities in more than 100 
countries worldwide. Historically, USDA's contribution to this program 
has averaged approximately $30 million a year, with additional funding 
provided by cooperators and third-party participants such as the 
foreign firms or governments that import and distribute U.S. products 
in the target markets.
    NCGA urges appropriators to support full funding for the Market 
Access Program at the authorized level of $90 million and to support 
efforts to maintain funding for the Foreign Market Development 
Cooperator Program for fiscal year 2000 at no less than the level 
necessary to support marketing plans for the development of overseas 
markets for U.S. commodities at current levels.
                         conservation programs
    As society's expectations for clean air, clean water and abundant 
wildlife habitat increase, so does the need to deliver conservation 
technical assistance to our nation's farmers and ranchers. Private 
lands comprise 70 percent of the lower 48 states and 80 percent of all 
precipitation in our country falls on private land. Therefore it is 
wise and in the public's interest to make sound investments in 
educating and equipping private landowners to conserve the natural 
resources in their care and to build upon stewardship efforts they 
already have in place.
    The Administration's proposed fiscal year 2000 budget for USDA's 
Natural Resources Conservation Service (NRCS) included $584.7 million 
for conservation technical assistance, an increase of approximately 
$36.8 million from 1999. After accounting for policy decisions and 
inflation, the president's request would result in a loss of 1,055 
staff positions from fiscal year 1999, most of which will come from 
NRCS field offices. It is estimated that an additional $90 million will 
be needed to retain these 1,055 staff positions to deliver technical 
assistance to the field. Therefore, we ask the committee to appropriate 
$674.7 million for NRCS technical assistance for fiscal year 2000.
                          ethanol pilot plant
    The nation's corn growers also urge your support for full funding, 
through ARS, for the National Corn-to-Ethanol Research Pilot Plant to 
be constructed in Edwardsville, Illinois. The Pilot Plant will provide 
a necessary tool to expand and perfect new technologies in wet and dry-
mill corn processing. What many people do not understand is that 
ethanol is just one of many products produced in corn processing 
facilities. Other products include high fructose corn syrup, glucose, 
dextrose and several high-protein animal feed ingredients. The corn 
milling industry is expected to grind 1.885 billion bushels of corn in 
the 1998-99 crop year, accounting for 16.4 percent of the total corn 
crop. Ethanol production accounts for between 550 and 600 million 
bushels of the corn grind. Corn processing adds value to corn and 
provides U.S. consumers with a wide array of products we all use every 
day.
    Since 1990, the corn milling industry has expanded, primarily 
because of expansion in the demand for ethanol. Many of the new corn 
milling facilities are small dry mills that are farmer-owned co-ops. 
While the capital investments required to build a dry mill are small 
relative to a large integrated wet mill, there are severe limitations 
in the product options dry mills have. Because of their small size and 
limited financial resources, these dry mills are not able to conduct 
the kind of research that is necessary to keep them competitive.
    The Pilot Plant would allow small corn millers to band together and 
form partnerships with NCGA, state corn grower associations, university 
researchers, and each other to pursue the development and 
commercialization of new technologies that will improve the economics 
of corn processing. Moreover, developing technologies that convert the 
cellulose in corn fiber into ethanol or other valuable products could 
be shared by corn processors of all sizes. Breakthroughs in these areas 
and the commercialization of new corn processing technologies could 
boost the domestic demand for corn by one billion bushels or more 
within the next seven to ten years.
    In fiscal year 1996, Congress appropriated $500,000 for ARS to 
study the feasibility of a Pilot Plant that industry, government and 
universities could use to assess the commercial potential of laboratory 
concepts. The project has moved forward with impressive results. In 
fiscal year 1997, Congress further endorsed this project by 
appropriating $1.5 million for final design and engineering. Final 
plans were completed in August 1998, and the project is ready to 
proceed with construction as soon as additional funds are appropriated. 
The state of Illinois has appropriated $6 million as matching funds, 
contingent upon $14 million in federal funds to construct this $20 
million project.
    The Ethanol Pilot Plant has been through an exhausting series of 
feasibility and engineering studies that have confirmed the need for, 
and the potential of, the project. It has also been endorsed by 
Congress. The project is ready for construction, with 30 percent of the 
capital funds provided by state government. Therefore, NCGA urges 
Congress to appropriate $14 million to the U.S. Department of 
Agriculture in fiscal year 2000 to bring the potential of this project 
to bear in the marketplace.
    The NCGA appreciates the opportunity to submit this testimony and 
looks forward to working with the committee on these priority issues 
for the corn industry.
                                 ______
                                 
      Prepared Statement of the National Cotton Council of America
    This is to transmit the cotton industry's request for fiscal year 
2000 funding for selected programs under the jurisdiction of the 
Subcommittee on Agriculture, Rural Development, and Related Agencies. 
The National Cotton Council appreciates your assistance in making this 
letter a part of the hearing records related to the fiscal year 2000 
appropriations bill.
    The National Cotton Council of America (NCC) is the central 
organization of the U.S. cotton industry representing growers, ginners, 
warehousemen, cottonseed crushers, merchants, cooperatives and 
manufacturers whose primary business operations are located in 17 
cotton producing states. Cotton Council International (CCI) is the 
overseas promotion arm of the cotton industry. The annual average farm 
gate value of U.S. cotton production is about $6 billion and its retail 
value averages approximately $60 billion. U.S. raw cotton exports 
normally account for approximately 40 percent of annual production and 
are valued at approximately $4 billion. U.S. textile manufacturers have 
invested nearly $25 billion in new plants and equipment in the U.S. 
during the last 10 years and continue to be the U.S. cotton producer's 
most important customers. Further, the growth in exports of U.S. 
manufactured cotton textile products, approaching 3.5 million bale 
equivalents, has been an important and positive development for the 
cotton industry and for farm income.
    Cotton prices have declined dramatically in recent months and 
market observers predict low prices could continue for the next 12-36 
months. The Asian economic crisis; changes in China's import policy; 
over production of cotton in Uzbeckistan and the Southern Hemisphere 
which has affected U.S. raw cotton export demand and spurred apparel 
exports to the U.S.; excess production of and cheap prices for 
synthetic fibers all contribute to a situation which has farmers deeply 
concerned by shrinking operating margins.
    The assistance Congress provided for economic and weather related 
losses in late 1998 was very important. However, prices remain at their 
lowest point in a decade and USDA projections suggest farm income will 
remain under stress. For cotton, the exhaustion of funding for Step 2 
competitiveness provision has left the industry unable to compete in a 
heavily subsidized international market.
    In the long-term, cotton farmers will benefit from activities 
designed to reduce production costs and build demand. Successful 
completion of the boll weevil eradication program, control of the pink 
bollworrn, new technology developed by research, and demand building 
export programs including MAP, FMD and GSM credit are all essential to 
our industry.
    The cotton industry's long-term viability and potential for 
continued improvement depend on: an effective farm policy including 
adequate funding for cotton's 3-step competitiveness provisions; an 
investment in the development and application of scientific principles; 
and, aggressive market development activities. The National Cotton 
Council welcomes the opportunity to provide the following 
recommendations and requests for fiscal year 2000 appropriations for 
programs which make important contributions to our industry's ability 
to compete and prosper (detailed description of these projects is 
attached):
                           funding priorities
    (1.) Pink Bollworm Programs--APHIS.--$6.0 million to continue San 
Joaquin Valley containment program and initiate an eradication program 
in 5 cotton producing counties in Arizona to move sequentially to 
eastern Arizona, New Mexico and west Texas.
    (2a.) Boll Weevil Eradication--FSA.--$3.0 million (or adequate 
funding) to allow FSA to make at least $100 million in loans to 
eligible Boll Weevil Eradication Foundations, clarify eligibility 
criteria, and require FSA to collect acreage data.
    (b.) Boll Weevil Eradication--APHIS.--Sufficient funds for APHIS to 
restore Federal cost share to 30 percent from current level of less 
than 5 percent.
    (3a.) Market Access Program (MAP).--$90 million.
    (b.) Foreign Market Development (FMD & FAS).--Sufficient funding to 
provide authority for FAS to write marketing plans at same funding 
level (approximately $33 million) as fiscal year 1999.
    (c.) GSM-102 Credit Guarantee (FAS).--Maintain authority to make at 
least $5.9 billion in GSM-102 guaranteed export credit available for 
use by U.S. exporters and customers.
    (4.) Aflatoxin.--Increase ARS aflatoxin research budget by $900,000 
to expand the area wide management program in Arizona.
    (5.) Ginning Research--ARS.--Urge ARS to provide adequate funding 
for operation of 3 regional ginning labs at Stoneville, MS; Lubbock, 
TX; and Mesilla Park, NM and instruct ARS not to reprogram fiscal year 
1998 funds provided to Lubbock lab.
    (6.) Farm Service Agency.--Adequate funding to deliver programs.
    (7.) Other.--Support funding for value-added textile research at 
New Orleans SRRC & Clemson; PM-10 research by CSREES; germplasm 
enhancement; silverleaf whitefly control programs; various conservation 
programs; and, Office of Pest Management Programs.
    Thank you for your consideration of our recommendations.
                                 ______
                                 
   Prepared Statement of the National Council of Farmer Cooperatives
    The National Council of Farmer Cooperatives (NCFC) appreciates very 
much this opportunity to share its views regarding the fiscal year 2000 
agriculture appropriations bill, and respectfully requests this 
statement be made a part of the official hearing record.
Overview of NCFC
    The National Council of Farmer Cooperatives (NCFC) is a national 
trade association representing nearly 100 regional marketing, supply 
and credit cooperatives, and state councils. Included among these 
regional cooperatives are over 3,500 local cooperatives whose farmer-
owners represent a majority of America's 2 million individual farmers.
    These farmer-owned cooperative businesses are engaged in virtually 
every facet of agriculture. This includes handling, processing, 
marketing and exporting of U.S. produced agricultural commodities and 
related products; the manufacture, distribution and sale of farm 
supplies; and the providing of credit and related financial services, 
including export financing for, and on behalf of, their farmer owners.
Support for Farmer Cooperatives
    For farmers, such cooperative self-help efforts provide the 
opportunity to reduce risks, capitalize on market opportunities and 
earn a greater return on their productivity and investment. Earnings 
derived from such business are returned to the cooperative's farmer 
owners on a patronage basis, which also helps contribute to local and 
regional economic activity as well as the national economy. Another 
important contribution is reflected in the fact these farmer-owned 
cooperative businesses also employ nearly 300,000 people (full and 
part-time) with a combined payroll of approximately $6.8 billion. Many 
of these jobs are in rural areas where employment opportunities are 
sometimes limited.
    Recent changes in farm policy, along with trends shaping the global 
business climate for U.S. agriculture, call for a renewed emphasis in 
support of policies and programs to help farmers help themselves 
through cooperative efforts to: (1) better manage the risks and 
uncertainty inherent in production agriculture; (2) capitalize on new 
market opportunities, including moving more into value-added production 
and processing; (3) compete more successfully in a global marketplace 
still characterized by subsidized foreign competition, and (4) help 
maintain and create needed jobs in communities throughout rural 
America.
USDA's Rural Business-Cooperative Service
    For these reasons, we strongly recommend that funding and staffing 
be strengthened for USDA's Rural Business-Cooperative Service (RBS) and 
its related programs aimed at achieving these important objectives. 
Such action would help ensure that USDA is fully able to carry out its 
historical mission as mandated by Congress in support of farmer 
cooperatives. It should be noted that many of the programs administered 
by RBS relating to farmer cooperatives are generally derived from 
amounts made available for salaries and expenses in the Rural 
Development mission area. To better provide for program continuity and 
long term planning, we believe that specific language should be 
included in the fiscal year 2000 agriculture appropriations bill to 
ensure needed funding and staffing for RBS programs for research, 
education and technical assistance in support of farmer cooperatives.
Commodity Purchase Programs and Farmer Cooperatives
    We want to express our strong support for maintaining both the 
statutory provisions and report language included in the fiscal year 
1999 agriculture appropriations bill as an amendment by Senator Cochran 
to ensure that farmer cooperatives are fully eligible to participate in 
USDA's commodity purchase programs. Such programs serve two important 
purposes. One, they help meet the food and nutrition needs of 
consumers. Second, they provide an important market outlet for farmers, 
especially during periods of surplus production, thereby helping 
strengthen farm income and promoting orderly marketing.
    We want to express our strong support for maintaining both the 
statutory provisions and report language included in the fiscal year 
1999 agriculture appropriations bill as an amendment by Senator Cochran 
to ensure that farmer cooperatives are fully eligible to participate in 
USDA's commodity purchase programs. Such programs serve two important 
purposes. One, they help meet the food and nutrition needs of 
consumers. Second, they provide an important market outlet for farmers, 
especially during periods of surplus production, thereby helping 
strengthen farm income and promoting orderly marketing.
    However, under previous guidelines established by USDA, this 
important market was eliminated for many farmers choosing to 
cooperatively market their products. The Cochran amendment addresses 
this by clearly providing that farmer cooperatives are fully eligible 
to participate in such programs for and on behalf of their farmer 
owners. In doing so, it preserves an important market outlet for many 
farmers, promotes orderly marketing, encourages cooperative self-help 
efforts, and helps maintain and strengthen farm income--since proceeds 
from the sale of commodities and related products are returned to the 
cooperatives' farmer owners as patronage income. The amendment also 
serves to increase the potential quantity and quality of commodities 
and related products available for purchase and use under such 
programs, and provides for more competitive bidding among participants. 
Finally, it helps contribute to stronger rural communities where farmer 
cooperatives and their farmer owners are located.
Crop Insurance/Risk Management
    As the Administration and Congress consider changes and 
improvements in the federal crop insurance program, we believe there 
needs to be an expanded role and opportunity for farmers through their 
cooperatives and associations to join together to help obtain broader 
coverage on a more cost-effective basis. We believe such action would 
also help encourage program participation, improve the current delivery 
system, strengthen private sector involvement, reduce administrative 
and related costs, and further encourage cooperative self-help efforts.
Export Programs
    We also believe it important to maintain and strengthen funding for 
USDA's export programs, including the Market Access Program (MAP) and 
Foreign Market Development (FMD) Cooperator Program, and we endorse the 
recommendations of the Coalition to Promote U.S. Agricultural Exports 
of which NCFC is a member. Such programs have been tremendously 
successful and extremely cost-effective in helping maintain and expand 
U.S. agricultural exports, countering subsidized foreign competition, 
protecting American jobs and strengthening farm income.
    Programs such as MAP and FMD have also helped encourage and 
strengthen the ability of farmers to join together in cooperative 
efforts to promote their products in overseas markets and improve their 
income. Administered on a cost-share basis, they remain one of the few 
tools specifically allowed under the Uruguay Round Agreement to help 
American agriculture and American workers remain competitive in a 
global marketplace still characterized by subsidized foreign 
competition.
    According to a recent analysis by USDA, the European Union (EU) and 
other foreign competitors are now outspending the U.S. by a factor of 
20 to 1 with regard to the use of export subsidies and other 
expenditures for export promotion. The same study shows that such 
countries are spending over $100 million just to promote sales of their 
products in the United States. In other words, they are spending more 
to promote agricultural exports to the United States, than the U.S. is 
currently spending ($90 million) to promote American agricultural 
exports worldwide!
    For this reason, we believe the Administration and Congress should 
give serious consideration to strengthening funding for MAP and other 
export programs, and ensuring that such programs are fully and 
aggressively utilized. Since MAP was originally authorized, funding has 
been gradually reduced from a high of $200 million to its current level 
of $90 million--a reduction of more than 50 percent. Again, given what 
our foreign trade competitors are doing, we believe it's time to 
restore funding for this vitally important program to its original 
level.
    We also urge continued funding for other related USDA export 
programs, including the Export Enhancement Program (EEP), Dairy Export 
Incentive Program (DEIP), GSM Export Credit Guarantee Program, and 
Public Law 480. All of these programs continue to be essential to help 
encourage U.S. agriculture exports, counter subsidized foreign 
competition, protect American jobs, and strengthen farm income.
Agricultural Research
    Another important area of emphasis when it comes to enhancing the 
global competitiveness of farmer cooperatives and American agriculture 
is research. It is equally important to help ensure that farmer 
cooperatives and American agriculture can continue to help provide 
consumers at home and abroad with a dependable supply of safe, high 
quality food and fiber at reasonable prices, while meeting important 
environmental and food safety objectives.
    This includes recognition of the need to help farmers, their 
cooperatives, and others engaged in agriculture meet the goals and 
requirements of such statutes as the Food Quality Protection Act 
(FQPA), the Clean Water Act (CWA), the Safe Drinking Water Act (SDWA) 
and the Clean Air Act (CAA), among others. To help meet these 
challenges, we believe every effort should be made to maintain and 
strengthen the highly successful public-private partnership involving 
USDA, the land grant universities and colleges, and the private sector. 
This includes providing needed funding at the federal level through 
USDA and ensuring that such funding helps achieve the important 
objectives outlined above.
Conservation/EQIP
    We strongly support continued funding for the Conservation Reserve 
Program (CRP), as well as restoring funding for the Environmental 
Quality Incentives Program (EQIP), as recommended in the 
Administration's budget. Such programs are necessary to help achieve 
and maximize water quality and other environmental benefits.
    The CRP and EQIP programs in particular are critical to empowering 
farmers to continue voluntary efforts to sustain the natural resource 
base and to respond to societal expectations and demands with regard to 
water quality and protecting our natural resource base.
Crop Protection/Pesticide Programs
    The Administration's budget request includes funds for Integrated 
Pest Management (IPM) programs and IR-4 program to collect and analyze 
data on pesticide residues through the Pesticide Data Program (PDP). We 
endorse the views of: (1) the Food Quality Protection Act-
Implementation Working Group (FQPA-IWG) of which NCFC is a steering 
committee member, and (2) the Minor Crop Farmer Alliance (MCFA) of 
which NCFC is a member of its executive committee. USDA's role in this 
process is critical if FQPA is to be implemented as intended by 
Congress.
    We believe USDA is uniquely qualified to (a) gather and provide 
data to the EPA regarding pesticide use and dietary consumption 
patterns, and (b) to provide information about crop protection needs 
and efficacious and affordable alternatives. USDA has statutory 
obligations to carry out regarding minor use pesticides pursuant to 
FQPA, including establishment of a minor use office to facilitate 
grower efforts to provide information needed to maintain or develop 
label uses. Clearly, USDA has an essential role to play in working with 
EPA regarding implementation of FQPA to ensure that food and 
agricultural policy considerations are taken into account. For these 
reasons, we strongly urge that adequate funding be provided to ensure 
that it has the necessary resources to carry out such responsibilities.
Meat Inspection/User Fees
    We continue to be opposed to user fees relating to Food Safety and 
Inspection Service (FSIS) for meat inspection. Such inspection programs 
provide important public benefits relating to food safety and quality 
and should continue to be publicly funded.
    Farmers through their farmer-owned cooperatives are already 
contributing to meeting important food safety and quality requirements 
through investment in new Pathogen Reduction Hazard Analysis and 
Critical Control Point (HACCP) Systems for meat and poultry. The 
imposition of new user fees, to the extent that such fees could not be 
passed on to consumers, would impose an additional cost burden on 
farmer cooperatives and their farmer members, and reduce farm income. 
Again, in recognition of the public benefits of such programs and the 
need to maintain confidence in the safety and quality of such products, 
the federal government should maintain its historic role.
Conclusion
    Mr. Chairman, on behalf of NCFC and its members, we want to again 
thank you for the opportunity to share our views with regard to the 
fiscal year 2000 agriculture appropriations bill. We also wish to take 
this opportunity to express our appreciation to you and the members of 
the Subcommittee for your interest and support of farmer cooperatives 
and American agriculture.
                                 ______
                                 
     Prepared Statement of the National Food Processors Association
    The National Food Processors Association (NFPA) is pleased to 
submit testimony to the Subcommittee expressing our views on the 
President's fiscal year 2000 Budget Request for the Food and Drug 
Administration (FDA) and Department of Agriculture (USDA).
    NFPA is the voice of the $430 billion food processing industry on 
scientific and public policy issues. Our members, whose headquarters 
and plants span from California to Connecticut, Maine to New Mexico, 
and points around the world, include large, small, and medium-sized 
purveyors of all kinds of packaged foods.
    Unique among food groups, NFPA is a science-based organization, 
employing 60 Ph.D.'s and regulatory experts and maintaining state-of-
the-art laboratories in Washington, D.C., Dublin, California, and 
Seattle. Our scientists conduct exacting experiments to protect the 
safety of America's enviable food supply and to guard against risks to 
consumers' well being.
    We are a science-based organization that invests in food safety and 
willingly shares its findings with all public health officials 
throughout the world. As this suggests, NFPA takes its responsibilities 
seriously.
    Guiding Principles.--NFPA does not automatically oppose or promote 
more spending on federal food safety programs. Rather, we recommend 
that any spending decisions be measured against these principles:
    (1) Congress should reject or delay any increases in spending to 
expand the powers of the Food and Drug Administration and the U.S. 
Department of Agriculture until these agencies demonstrate that their 
current levels of funding are allocated in the most effective and 
efficient manner possible to protect the public's health. Agencies 
should be expected to clearly delineate their current statutory powers 
and explain why any new authority is needed.
    (2) The agencies should vigorously apply the principles of sound 
science and risk assessment to their food safety programs.
    (3) Appropriations should be linked to a determined effort by the 
FDA and USDA to approve new technologies and food safety tools that can 
safety deter or eliminate foodborne pathogens.
    (4) Through its power of the purse, Congress should persuade 
federal food safety agencies to fully exercise their capacity for 
research and education.
    User Fees.--For nearly a decade, the annual budget requests of 
President Clinton and preceding Administrations have doggedly proposed 
user fees--regulatory taxes--that require food processors to pay for 
the privilege of being regulated. Congress has summarily rejected the 
idea each year.
    The President's fiscal year 2000 budget proposes nearly $525 
million per year in regulatory taxes on the food industry--most of 
which would be imposed on meat and poultry processing plants. Imposing 
fees upon Federally regulated food processing facilities would amount 
to nothing more than a highly regressive tax on food products to be 
passed on to consumers in the form of higher food prices, and to 
farmers and ranchers in the form of reduced profit margins. In fact, 
the Supreme Court has held that the imposition of user fees on 
regulated companies for benefits enjoyed by the general public must be 
considered a tax.
    There is no clearer example of a fundamental government function 
that broadly benefits society than regulating the safety and soundness 
of the food supply. Because all Americans benefit from this important 
public health work the agencies' resources must come from appropriated 
funds. Moreover, food taxes imposed upon the regulated industry 
threaten to compromise public confidence in the independence of food 
regulation.
    Food Safety Initiative.--The President's fiscal year 2000 Budget 
recommends nearly $105 million in increased spending for the third year 
of the President's Food Safety Initiative (FSI), including new food 
safety funding for FDA and USDA. NFPA has been supportive of funding in 
fiscal year 1998 and fiscal year 1999 for FDA and USDA to enhance their 
food safety programs relative to research, risk assessment, 
coordination and education.
    NFPA is concerned, however, with the Food Safety Initiative's 
continued emphasis on seeking additional funds simply to hire 
additional inspectors. In order to ensure that resources are used 
wisely, it is essential that resources first be dedicated to 
identification and prevention of foodborne illness, particularly in 
high-risk foods. In that regard, NFPA strongly urges that if the 
Subcommittee provides additional FSI funding in fiscal year 2000 that 
such funds be dedicated toward risk assessment, research and education.
    Funding for U.S. Codex Activities.--NFPA joins with other members 
of the food industry and the Food Industry Codex Coalition (FICC) to 
recommend that the Subcommittee provide initial ``seed'' funding to 
support the activities of the U.S. Codex Office in the Department of 
Agriculture. Codex Alimentarius (Codex) is the referenced organization 
for food safety standards used to resolve trade disputes under the 
World Trade Organization (WTO). Dedicated resources are necessary to 
ensure U.S. leadership in Codex, and to expand and preserve export 
opportunities for U.S. products and advance international food policy 
based on sound science.
    Juice Safety.--The FDA has proposed a pending regulation that would 
impose a new layer of mandatory, costly, and unnecessary federal 
regulation on juice processors who pasteurize their products or employ 
equivalent methods to kill pathogens. Under FDA's proposed rule, 
processors of pasteurized fruit and vegetable juices would have to 
implement a Hazard Analysis Critical Control Point (HACCP) regimen.
    Such action runs contrary to these findings: ninety-eight percent 
of all fruit and vegetable juices consumed in the U.S. are pasteurized 
or undergo an equivalent ``kill step'' to eliminate pathogens that can 
cause sickness or worse. Each year, the FDA estimates that 6,000-6,200 
Americans will suffer sickness from juices--and all are caused by the 2 
percent of juices that are not pasteurized.
    For unpasteurized juices, those that cause all the illnesses 
recorded, the FDA has prescribed a mere label saying the juice isn't 
pasteurized. For the 98 percent that have caused no sicknesses, the FDA 
prescribes the redundant and costly application of HACCP.
    NFPA supports HACCP as an effective means of protecting the 
public's health when appropriate. Mandatory HACCP is decidedly not 
appropriate here. NFPA recommends that the Subcommittee work to ensure 
that FDA's final regulation on juice safety imposes no new HACCP 
mandate, but instead requires that juices are pasteurized, or treated 
by any equivalent method.
    Reform of FDA's Food Additive Review Process.--The food additive 
approval process at FDA is badly broken. Despite statutory requirements 
for approval within six months, it can take a decade or more for the 
FDA to approve new food additives. Problems associated with FDA's 
failure to act in a timely manner on direct food additive petitions 
were well documented in 1995 during hearings before the House 
Government Reform Committee, but since then, little or no progress has 
occurred. Because of these unreasonable delays and the disincentives 
they impose, fewer companies seem willing to explore new roads to food 
safety or submit food ``additive'' petitions to clear these paths.
    The food industry, led by NFPA, has and continues to approach the 
FDA with proposals to reform the food additive approval process. 
Contrary to NFPA's general opposition to user fees where there is no 
unique proprietary benefit, NFPA has agreed to support ``review fees'' 
in exchange for FDA's adherence to specific performance goals to 
expedite the review and approval of direct food additive petitions. 
NFPA does not support the Administration's fiscal year 2000 request to 
impose user fees on food additive petitioners since there is no 
apparent obligation upon FDA to ensure that a petitioner would enjoy a 
more timely review of its petition.
    Instead, NFPA recommends that the Subcommittee encourage the FDA to 
work with its constituent groups to reach agreement on an approach that 
will permanently reform the current food additive review and approval 
process.
    Food Irradiation.--NFPA continues to have serious concerns with the 
slow pace of federal review and approval of food irradiation as a 
proven and effective food safety technology. Irradiation poses no 
threats, only advantages, to consumers and does not alter the taste or 
texture of the food. Yet, it took FDA nearly three and one-half years 
to approve its use on red meat in December 1997. Compounding this delay 
has been the Department of Agriculture's failure to even propose a 
regulation to enable irradiation's use until early 1999. USDA is not 
expected to complete its review of red meat irradiation until the year 
2000. Meanwhile, the need for red meat irradiation in the marketplace 
has never been greater.
    NFPA recommends that the Subcommittee ensure that USDA devote ample 
resources to ensuring the timely review and approval of red meat 
irradiation. In addition, we recommend that USDA and FDA be directed to 
examine their review and approval procedures for irradiation to ensure 
better coordination and to avoid duplicative and unnecessary resource 
demands that undoubtedly have contributed to the lengthy delays.
    Finally, NFPA recommends that the Subcommittee direct both USDA and 
FDA to more thoroughly examine their existing policies toward food 
irradiation labeling disclosures. Existing labeling requirements convey 
uncertainty to many consumers about the safety of irradiated foods, and 
may serve to deny many consumers access to irradiated food products. 
Pending USDA and FDA rulemakings are soliciting public comment on this 
subject, and NFPA urges this review be completed in a timely manner.
    Imported food safety.--The FDA has requested additional funds for 
fiscal year 2000 to increase inspections of imported food. FDA has also 
indicated its intent to seek increased statutory authority in 1999 to 
prevent the importation of foods from countries determined by FDA to 
provide food safety systems that are less than ``equivalent'' to that 
of the United States. NFPA and its member companies strongly support 
efforts to improve the safety of imported foods, but believes FDA 
should fully exercise its existing authority before seeking new powers.
    NFPA recommends that the Subcommittee encourage FDA to identify 
what specific new regulatory activities FDA would be expected to 
undertake, along with commensurate resource demands, if the Congress 
grants FDA new statutory. Furthermore, NFPA recommends that FDA 
undertake a comprehensive review of its coordination with the U.S. 
Customs Service to ensure utilization of the full panoply of existing 
enforcement authorities to deter and reduce the incidence of imported 
food violations attributable to repeat offenders.
    Other routes to the same goal--safe food without debilitating 
confrontations--are already in place. Codex Alimentarius, a framework 
for international negotiations on food safety, is well established in 
its process and success. Bilateral Equivalence Agreements, Memoranda of 
Understanding, and Mutual Recognition Agreements are also in place.
    NFPA sees in these approaches less provocation and intrusion, 
coupled with more effect. Other strategies may include requiring 
equivalent safety protocols in foreign countries (not ``the same as''), 
punishing repeat offenders, and ensuring that port shopping is brought 
to a halt (that is, when a shipment of food is rejected at one port, 
they re-label the product and try to bring it in at another).
    Once again, NFPA seeks a full explanation from the FDA of any 
inadequacies they see in current statute before Congress wades into 
changes in the law. Only through a complete disclosure can we engage in 
a productive debate. We also think that this subcommittee would be well 
served by demanding such documentation and delineation.
    Thank you for your time and consideration of NFPA's views. Please 
contact us if we can provide additional information to the 
Subcommittee. In the meantime, please visit our web site a www.nfpa-
food.org.
                                 ______
                                 
           Prepared Statement of the National Potato Council
    My name is Chuck Gunnerson. I am a potato farmer from Minnesota and 
current Vice President, Legislative/Government Affairs for the National 
Potato Council (the Council). On behalf of the Council, we thank you 
for your attention to the needs of our potato growers.
    The Council is the only trade association representing commercial 
growers in 50 states. Our growers produce both seed potatoes and 
potatoes for consumption in a variety of forms. Annual production in 
1997 was 407,164,000 cwt with a farm value of $2.2 billion. Total value 
is substantially increased through processing. The potato crop clearly 
has a positive impact on the U.S. economy.
    The potato is the most popular of all vegetables grown and consumed 
in the United States and one of the most popular in the world. Annual 
per capita consumption was 143 pounds in 1996 up from 107 pounds in 
1962 and is increasing due to the advent of new products and heightened 
public awareness of the potato's excellent nutritional value. Potatoes 
are considered a stable consumer commodity and an integral, delicious 
component of the American diet.
    The National Potato Council's fiscal year 2000 appropriations 
priorities are as follows:
    Agricultural Research Service (ARS).--The NPC proposes additional 
potato research funds for:
  --Orono, Maine.--Potato production in northern Maine has shown a 
        significant decline in recent years. This trend will, however, 
        be reversed with the construction of a new potato processing 
        facility in Maine by McCain Foods. It is estimated that 15,000 
        acres will be returned to potato production. The current ARS 
        research program has included a search for alternative crops 
        that could be used in a potato rotation. Potatoes are grown in 
        three-year rotations with soybean, canola, green bean, sweet 
        corn, and barley/clover. An interdisciplinary team of two 
        scientists is evaluating cropping system impacts on soil 
        nutrient dynamics and soilborne pathogen ecology. A third 
        scientist is being recruited to assess crop management system 
        effects on potato late blight. Integrating the production of 
        several crops is a high priority. The addition of an agronomist 
        to supplement the soil science and pathology research will 
        greatly strengthen the potato program in Maine. Estimated cost 
        is $300,000/year.
  --Prosser, Washington.--The ``precision agriculture'' group at 
        Prosser that focussed on potato production was disbanded. 
        Currently, recruitments are in process for a weed and soil 
        scientist. There is a need to continue research on site-
        specific management and to focus on the biology of potato 
        production. To accomplish this goal, an agronomist should also 
        be added to the Prosser group. The objective of this position 
        would be to integrate the soil, weed, pathology and entomology 
        information on potato production into a more effective system. 
        There is a need to achieve better quality as well as improved 
        yield. The estimated cost is $300,000/year.
  --Beltsville, Maryland.--Improving the nutritional value of the 
        potato is a high priority of the NPC. The Beltsville Vegetable 
        Laboratory program has relied heavily on traditional breeding 
        and new high quality germplasm has been introduced over a 
        period of many years. Genes critical to the accumulation of 
        selected nutrients such as B-carotene, lycopene, polyamines, 
        lipoic acid, glutathione and ascorbic acid have been identified 
        in several crops. These phytonutrients have been correlated 
        with a reduced incidence of some forms of cancer. It is now 
        possible to introduce these genes, after specific modification, 
        into potatoes and other vegetable crops. Research should be 
        initiated that combines traditional breeding and plant 
        biotechnology to increase the nutritional value of the potato 
        and add value to the crop. Estimated cost would be $300,000/
        year.
  --Albany, California.--Introduction of genes for potato improvement 
        utilizing biotechnology procedures is a goal of ARS research. 
        Currently, there are significant restrictions on the use of 
        some important reagents that prevent successful 
        commercialization of plants transformed by ARS scientists. Dr. 
        William Belknap in Albany has been funded by ARS, with 
        endorsement from the NPC, to develop genetic constructs for 
        potato transformation that will be publicly available without 
        patent restrictions on their use. His laboratory should serve 
        as a source of reagents for use by ARS scientists and others 
        who work in the public sector. Estimated cost of providing this 
        service is an additional $100,000/year to Dr. Belknap's base 
        CRIS budget.
  --Report Language.--Agricultural Research Service (ARS)--The NPC 
        urges that the Congress once again add Committee report 
        language urging the ARS to work with the NPC on how funds can 
        best be used for research priorities.
    Cooperative State Research, Education and Extension Service 
(CSREES).--The NPC urges that the Congress increase funding to a level 
of $1.4 million for the potato research special grant program to return 
to previous year's funding levels.
    The NPC also urges that the Congress, once again, include report 
Committee language as follows:
    ``Potato research.--The Committee expects the Department to ensure 
that funds provided to CSREES for potato research are utilized for 
varietal development testing. Further, these funds are to be awarded 
competitively after review by the potato industry working group.''
    Plant Protection and Quarantine Service (APHIS-USDA).--The NPC 
urges that the Congress appropriate $580,000 for the Golden Nematode 
Quarantine Program, which amount is the fiscal year 2000 budget 
request. The National Potato Council also supports increasing the 
fiscal year 2000 budget request for AQI user fees from $95 to $100 
million. The NPC also supports fiscal year 2000 budget requests for the 
AQI appropriated funds, sanitary/phytosanitary (SPS) management and 
pest surveillance and detection.
    Finally, we also support the Administration's budget request for 
funds to meet the data requirements of the new Food Quality Protection 
Act, (FQPA).
                                 ______
                                 
      Prepared Statement of the National Rural Telecom Association
                     summary of testimony requests
    Project involved:Telecommunications lending programs administered 
by the Rural Utilities Service of the U.S. Department of Agriculture
    Actions proposed:
  --Supporting loan levels for fiscal year 2000 in the same amounts as 
        those contained in the fiscal year 1999 Agriculture 
        Appropriations Act (Public Law 105-277, Sec. 101(a)) for 
        hardship, cost-of-money and guaranteed loan programs and the 
        associated subsidy to fund those programs at existing levels.
  --Supporting Rural Telephone Bank loans in the amount requested in 
        the President's budget and the associated subsidy to fund this 
        level.
  --Supporting funding in the amount of $200 million in loans and $20 
        million grant authority designated for distance learning and 
        telemedicine purposes as requested in the President's budget.
  --Supporting an extension of the language removing the 7 percent 
        interest rate ceiling on cost-of-money loans.
  --Supporting continuation of the restriction on retirement of Rural 
        Telephone Bank class A stock in fiscal year 2000 at the level 
        contained in Public Law 105-277 and an extension of the 
        prohibition against the transfer of Rural Telephone Bank funds 
        to the general fund.
  --Opposing the proposal contained in the budget to transfer funds 
        from the unobligated balances of the liquidating account of the 
        Rural Telephone Bank for the bank's administrative expenses and 
        loan subsidy costs.
    Mr. Chairman, Members of the Committee: My name is John F. O'Neal. 
I am General Counsel of the National Rural Telecom Association. NRTA is 
comprised primarily of commercial telephone companies which borrow 
their capital needs from the Rural Utilities Service of the U.S. 
Department of Agriculture (RUS) to furnish and improve telephone 
service in rural areas. Approximately 1000, or 71 percent of the 
nation's local telephone systems borrow from RUS. About three-fourths 
of these are commercial telephone companies. RUS borrowers serve almost 
6 million subscribers in 46 states and employ over 22,000 people. In 
accepting loan funds, borrowers assume an obligation under the act to 
serve the widest practical number of rural users within their service 
area.
Program background
    Rural telephone systems have an ongoing need for long-term, fixed 
rate capital at affordable interest rates. Since 1949, that capital has 
been provided through telecommunications lending programs administered 
by the Rural Utilities Service and its predecessor, the Rural 
Electrification Agency (REA).
    RUS loans are made exclusively for capital improvements and loan 
funds are segregated from borrower operating revenues. Loans are not 
made to fund operating revenues or profits of the borrower system. 
There is a proscription in the Act against loans which would duplicate 
existing facilities providing adequate service and state authority to 
regulate telephone service is expressly preserved under the Rural 
Electrification Act.
    Rural telephone systems operate at a severe geographical handicap 
when compared with other telephone companies. While almost 6 million 
rural telephone subscribers receive telephone service from RUS borrower 
systems, they account for only four percent of total U.S. subscribers. 
On the other hand, borrower service territories total 37 percent of the 
land area--nearly 1\1/2\ million squares miles. RUS borrowers average 
about six subscribers per mile of telephone line and have an average of 
more than 1,000 route miles of lines in their systems.
    Because of low-density and the inherent high cost of serving these 
areas, Congress made long-term, fixed rate loans available at 
reasonable rates of interest to assure that rural telephone 
subscribers, the ultimate beneficiaries of these programs, have 
comparable telephone service with their urban counterparts at 
affordable subscriber rates. This principle is especially valid today 
as the United States endeavors to deploy telecommunications 
``information superhighway'' technology and as customers and regulators 
constantly demand improved and enhanced services.
    At the same time, the underlying statutory authority which governs 
the current program has undergone significant change. In 1993, 
telecommunications lending was refocused toward facilities 
modernization. Much of the subsidy cost has been eliminated from the 
program. The subsidy that remains has been targeted to the highest 
cost, lowest density systems. Other loans are made at Treasury's cost-
of-money or greater.
    We are proud to state once again for the record that there has 
never been a default in the RUS/REA telephone program! All loans have 
been repaid in accordance with their terms with interest. As of 
December 31, 1997, over $4.5 billion of principal and over $5 billion 
in interest had been paid by telephone borrowers to the federal 
government under this program.
Need for RUS telecommunications lending continues
    The need for rural telecommunications lending is great today, 
possibly even greater than in the past. Technological advances make it 
imperative that rural telephone companies upgrade their systems to keep 
pace with improvements and provide the latest available technology to 
their subscribers.
    These rapid technological changes and federal policies of 
competition and deregulation in the telephone industry, as evidenced by 
passage of the ``Telecommunications Act of 1996'', underscore the 
continuing need for targeted assistance to rural areas. The inherently 
higher costs to serve these areas have not abated. Regulatory trends 
encouraging competition among telephone systems increase pressures to 
shift more costs onto rural ratepayers. Interstate subscriber line 
charges have already shifted substantial costs to local exchange 
customers. Pressures to recover more and more of the higher costs of 
rural service from rural customers to foster urban competitive 
responses will further burden rural consumers. And, as rural rates 
rise, small telephone systems will tend to lose confidence that they 
can recover the investments for costly network upgrades.
1996 Telecommunications Act effect on rural America
    Congress passed the Telecommunications Act of 1996 as the 
culmination of more than a decade of debating national 
telecommunications policy and balancing many diverse needs and 
interests. The 1996 Act responded to a number of rural needs and 
differences with a series of safeguards to ensure that rates, services 
and network development in rural America will be reasonably comparable 
to urban telecommunications opportunities.
    The process of implementing the new law continues to raise 
troubling uncertainties and concerns about whether the FCC and the 
states will honor the balance Congress achieved in its policy, as 
regulators (a) radically revise the mechanisms for preserving and 
advancing ``universal service,'' (b) adjust the cost recovery 
responsibilities and allocations of authority between federal and state 
regulation, (c) effectuate the Act's somewhat different urban and rural 
ground rules for how new companies and incumbent universal service 
providers connect their networks and compensate each other and (d) peel 
back layers of regulation developed over a century. So far, the FCC has 
been overzealous in expanding the Act's market-opening provisions to 
give new entrants a regulatory head start and advantage at the expense 
of the Act's rural development and universal service provisions. The 
FCC is trying to unsurp the role of competition by dictating a whole 
new--and wholly inadequate--way to measure the costs of modern, 
nationwide telecommunications access to information. The FCC needs to 
reorder the sequence of its proceedings to ensure that rural Americans 
are not denied the ongoing network development and new services the Act 
requires. Rural telephone systems with universal service obligations 
must not be thwarted in their efforts to upgrade and provide rates and 
services reasonably comparable to urban offerings. The FCC must not 
falter in delivery on these national policies either during or after 
the difficult process of implementing the law. Congress and the courts 
must carefully supervise the FCC's implementation to achieve the rural 
access to information and an evolving modern public network intended by 
Congress, as well as the benefits of deregulation and genuine 
competition.
Expanded congressional mandates for rural telecommunications
    Considerable loan demand is being generated because of additional 
mandates for enhanced rural telecommunications standards contained in 
the authorizing legislation enacted in 1993 by Congress in Public Law 
103-129. These mandates coupled with the need for stable financing 
sources to meet the infrastructure demands envisioned for rural areas 
by the 1996 telecommunications act amply demonstrate the continuing 
need for this important program at the following levels:

5 percent Hardship Loans................................     $75,000,000
Cost-of-Money Loans.....................................     300,000,000
Guaranteed Loans........................................     120,000,000
Rural Telephone Bank Loans..............................     175,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     670,000,000

    These are the levels established in the fiscal year 1999 
appropriations act for the hardship, cost-of-money and guaranteed loan 
programs. The $175 million loan level is the historical level for Rural 
Telephone Bank loans and the amount requested in the President's fiscal 
year 2000 budget. However, the President's budget also seeks to reduce 
the amount of hardship loans despite the substantial ongoing demand. We 
believe that the needs of this program balanced with the minimal cost 
to the taxpayer argue for its continuation at enacted levels given the 
fact that it provides funding for the neediest borrower systems serving 
the highest cost areas.
Specific Additional Requests
            Continue the Removal of the 7 percent Cap on Cost-of-Money 
                    Loans
    Again this year we are supporting removal of the 7 percent ceiling 
on cost-of-money loans even though long-term Treasury rates are 
currently substantially below this level. This Committee included 
language in the fiscal year 1996 act to permit borrower interest rates 
on cost-of-money loans to exceed the 7 percent per year interest rate 
ceiling contained in the authorizing act. The language has been 
continued in subsequent acts. We support an extension of this provision 
in the fiscal year 2000 bill. In the event that long-term Treasury 
interest rates might exceed 7 percent during the next fiscal year. If 
that happens, the cost-of-money loan program could be disrupted and 
loan levels not achieved since adequate subsidy would not be available 
to support the program at the authorized levels. For this reason, we 
believe it is important to incorporate this language in the bill again 
this year.
            Continue the Restriction on Retirement of Class A 
                    Government Stock in the Rural Telephone Bank (RTB) 
                    and also Continue the Prohibition Against Transfer 
                    of RTB Funds to the General Fund and Require the 
                    Payment of Interest
    The Committee should continue the restriction on retirement of the 
amount of class A stock by the Rural Telephone Bank in fiscal year 
2000. The Bank is currently in the process of retiring the government's 
stock as required under current law. We believe that this process which 
began in fiscal year 1996 should continue to be an orderly one as 
contemplated by the retirement schedule enacted four years ago and 
continued in last year's bill to retire no more than 5 percent of the 
total class A stock in one year. We also urge the Committee to continue 
the prohibition against the transfer of any unobligated balance in the 
bank's liquidating account which is in excess of current requirements 
to the general fund of the Treasury along with the requirement that the 
bank receive interest on those funds. The private Class B and C 
stockholders of the Rural Telephone Bank have a vested ownership 
interest in the assets of the bank including its funds and their rights 
should be protected.
            Reject Budget Proposal to Transfer Funds from RTB 
                    Liquidating Account for Subsidy and Administrative 
                    Costs
    In this same vein, we are also opposed to the proposal contained in 
the President's budget again this year that the subsidy cost associated 
with Rural Telephone Bank loans be funded by a transfer from the 
unobligated balances of the bank's liquidating account rather than by a 
traditional appropriation from the general fund of the Treasury which 
has been the funding mechanism utilized for the bank since enactment of 
the federal credit reform act in 1990. Requiring the bank to fund the 
subsidy cost of its loans would dilute the interests of the bank's 
stockholders. By definition, the bank's unobligated balances are not 
exclusively federal funds but are subject to the respective ownership 
interests of all the stockholders of the bank. Previous appropriations 
acts, including the fiscal year 1997, 1998 and 1999 acts, have 
recognized the ownership rights of the private class B and C 
stockholders of the bank by prohibiting a similar transfer of the 
bank's excess unobligated balances which otherwise would have been 
required under the federal credit reform act. This cost is more 
properly funded through a regular appropriation from the general fund 
of the Treasury.
    The President's budget also proposes that the bank assume 
responsibility for its administrative costs also by a transfer of funds 
from the unobligated balances of the bank's liquidating account rather 
than through an appropriation from the general fund of the Treasury. 
This recommendation is contrary to the specific language of Sec. 403(b) 
of the RTB enabling act.
    The budget language acknowledges that neither proposal would result 
in budgetary savings. Both proposals were specifically rejected last 
year by this Committee. No justification for these recommendations is 
contained in the budget again this year. Both proposals would require 
consideration by the authorizing committees and enactment of new 
authorizing legislation as a prerequisite to an appropriation. As of 
this date, no such legislation has been transmitted by the 
Administration or is under consideration before the authorizing 
committees.
            Loans and Grants for Telemedicine and Distance Learning
    The President's budget requests $200 million in loan authority for 
fiscal year 2000 and $20 million in grants specifically devoted to 
telemedicine and distance learning purposes. Loans are made at the 
government's cost-of-money. The purpose is to accelerate deployment of 
telemedicine and distance learning technologies in rural areas through 
the use of telecommunications, computer networks, and related advanced 
technologies by students, teachers, medical professionals, and rural 
residents.
    We believe this program specifically designated for distance 
learning and telemedicine purposes is particularly important. 
Continuing to target funds in this manner spurs deployment of this 
important new technology which is vital for the survival of rural 
schools, hospitals and the rural communities they serve. At the same 
time, we believe the level proposed strikes a cost effective balance 
for the taxpayer.
                               conclusion
    Thank you for the opportunity to present the association's views 
concerning this vital program. The telecommunications lending programs 
of RUS continue to work effectively and accomplish the objectives 
established by Congress at a minimal cost to the taxpayer.
                                 ______
                                 
 Prepared Statement of the National Telephone Cooperative Association 
                               Regarding
                                summary
    The information age continues to evolve at lightening speed, 
permeating every element of our existence. No longer a luxury at all, 
today, access to advanced, affordable, communications infrastructure 
and services, by every American, is an absolute necessity. Indeed, 
federal, state, and local executives, legislators, and regulators, as 
well as the general public, are demanding nothing less.
    The small rural incumbent local exchange carrier (ILEC) segment of 
the communications industry has responded to these demands with 
outstanding vigor, providing perhaps the most exceptional 
telecommunications services of anywhere in the nation. It has done so 
through both a deep commitment to community and by having access to the 
affordable financing that is available via the Rural Utilities Service 
(RUS) Telecommunications Loan Program.
    For 50 years, NTCA's small rural ILEC members, in partnership with 
the RUS, have fulfilled the joint statutory mission of both providing 
and improving rural telecommunications service, with distinction. With 
the RUS appropriately funded, they will be able to continue doing so 
well into the future. Therefore NTCA recommends full funding for all 
accounts of the RUS Telecommunications Loan Program and its related 
community development program. Additionally, NTCA recommends that 
language be included in the fiscal year 2000 appropriations package 
which will protect the program, and particularly the Rural Telephone 
Bank (RTB), from frivolous or premature actions intended to redirect 
their course.
                               background
    NTCA is a national trade association representing more than 500 
small, rural, cooperative and commercial incumbent local exchange 
carriers (ILECs) located throughout the nation. These locally owned and 
operated ILECs provide local exchange service to more than 5 million 
rural Americans. Through the 50 year history of the RUS 
Telecommunications Loan Program, more than 80 percent of NTCA's member 
systems have been able to utilize the federal program to one degree or 
another.
    NTCA's members, like most of the country's independent ILEC's, 
evolved to serve high cost rural areas of the nation that were 
overlooked by the industry's giants as unprofitable. And there can be 
no doubt regarding the high cost of such markets. Consider that the 
combined service area's of these ILECs constitutes approximately 40 
percent of the nation's geographic area, yet the more than 5 million 
subscribers served in this territory account for little more than 4 
percent of the nation's total access lines. On average, RUS borrowers 
have approximately 6 subscribers per mile of infrastructure line, 
compared with 130 for the larger urban-oriented, non-RUS financed 
systems. This results in an average plant investment per subscriber 
that for RUS borrowers is 38 percent higher than for most other 
systems.
    Congress recognized the unique financing dilemma confronting 
America's small rural ILECs as early as 1949. It was in that year that 
it amended the Rural Electrification Act (RE Act) to create the Rural 
Electrification Administration (REA) Telephone Loan Program, today 
known as the RUS Telecommunications Loan Program. Through the years 
Congress has periodically amended the RE Act to ensure that that 
original mission--to furnish and improve rural telephone service--was 
met. In 1971, the Rural Telephone Bank (RTB) was created as a 
supplemental source of direct loan financing. In 1973, the RUS was 
provided with the ability to guarantee Federal Financing Bank (FFB) and 
private lender notes. In 1993, Congress established a fourth program 
lending facet, the Treasury Cost of Money account.
                 rus helps meet infrastructure demands
    While the RUS has helped the subscribers of NTCA's member systems 
receive service that is comparable or superior to that available 
anywhere in the nation, their work is far from complete. As federal 
policies such as the Telecommunications Act of 1996 continue to evolve, 
the high costs associated with providing modern telecommunications 
services in rural areas will not diminish. Three years into the 
implementation of the 1996 Act, the Federal Communications Commission's 
(FCC's) interpretation of the statute, and several court decisions, 
have held little regard for congressional intent particularly with 
respect to universal service which is so vital to small rural ILECs. 
Consequently, the ongoing need for the well defined, understood, time-
tested RUS Telecommunications Loan Program is even greater.
    For example, RUS telecommunications lending has stimulated billions 
of dollars in private capital investment in rural communications 
infrastructure. In recent years, on average, less than $10 million in 
federal subsidy generated $670 million in federal loans and loan 
guarantees. For every $1 in federal funds that were invested in rural 
communications infrastructure, $4.50 in private funds were invested.
    The RUS is also making a difference in our rural schools, 
libraries, and hospitals. Since 1993, the RUS Distance Learning and 
Telemedicine Grant and Loan program has funded approximately 200 
projects throughout the nation for interactive technology in rural 
schools, libraries, hospitals, and health clinics. This program has 
provided unprecedented educational opportunities for rural students and 
enhanced health care for rural residents.
    In addition, two other RUS related programs are making a difference 
in rural America. Formerly under the RUS and known as the Zero Interest 
Loan and Grant Program, the Rural Economic Development Grants Program 
and the Rural Economic Development Loans Program are now managed by the 
Rural Business Cooperative Service. The two programs provide funds for 
the purpose of promoting rural economic development and job creation 
projects, including funding for project feasibility studies, start-up 
costs, incubator projects and other expenses tied to rural development. 
The two programs have allowed hundreds of communities to build, 
acquire, and/or install everything from firehouses to recreational 
facilities that enhance the viability of the community.
                 ntca's appropriations recommendations
Fully Fund The RUS Telecommunications Loan Program:
    Increasing demand for expanded telecommunications services and 
infrastructure upgrades indicates a continuing strong need for stable 
loan levels at the authorizations established by the Rural 
Electrification Loan Restructuring Act of 1993. The president's budget 
proposal to cut the Hardship account to a level of $50 million is 
inappropriate considering that a backlog of applications for these 
funds continues to exist. Likewise, last year's congressional response 
to fully funding the Hardship account by reducing funding for the RTB 
account would be inappropriate as the RTB is again being fully 
utilized. Adequate subsidy must be appropriated to support the 
following fiscal year 2000 loan account levels:

Hardship Account........................................     $75,000,000
Treasury-rate Account...................................     300,000,000
Guaranteed Account......................................     120,000,000
Rural Telephone Bank Account............................     175,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     670,000,000

Extend Removal Of The Interest Rate Cap On Treasury-Rate Loans:
    NTCA is also requesting that Congress again include language 
removing the 7 percent interest rate cap on Treasury-rate loans. This 
provision has been included in recent appropriations measures to 
prevent the potential disruption of the program in the case where 
interest rates exceed 7 percent and insufficient subsidy cannot support 
authorized lending levels.
Prohibit The Transfer Of Unobligated Balances Of The RTB Liquidating 
        Account
    NTCA also recommends that Congress continue the prohibition against 
the transfer of any unobligated balances of the Rural Telephone Bank 
liquidating account to the general fund of the Treasury. This language 
has routinely been included in annual appropriations measures since the 
enactment of the Federal Credit Reform Act (FCRA), Public Law 101-508, 
that allows such sweeping to potentially occur. Restatement of this 
language will again ensure that the RTB's private class B & class C 
stockholder are not stripped of the value of their statutorily mandated 
investment in the Bank.
Prohibit RTB From Self Funding Subsidy And Administrative Costs
    The Administration's fiscal year 2000 budget proposal suggests 
funding the RTB's loan subsidies and administrative expenses out of 
unobligated balances in the bank's liquidating account rather than out 
of the general fund of the Treasury as is required by the RE Act. NTCA 
urges Congress to reject this proposal, as it did last fiscal year, for 
the following basic reasons: (1) such action would require amendment of 
the RE Act, (2) the proposal appears to be in conflict with the intent 
of the FCRA, (3) the proposal will not result in federal budgetary 
savings, (4) it is unnecessary to the determination of whether the bank 
could operate independently, and thus would amount to wasting the 
resources of the bank which could be put to better use upon its 
complete privatization, and (5) the bank should not be expected to self 
fund these expenses while concurrently being prohibited from utilizing 
the unobligated balances in its liquidating account for the re-making 
of new loans.
Rural Telephone Bank Privatization
    Under the President's fiscal year 2000 budget proposal, the RTB is 
proposed to ``become a Performance Based Organization (PBO) to 
establish its financial and operational independence prior to its being 
privatized within ten years.'' At this time, it is difficult to 
support, or evaluate any privatization proposal without first obtaining 
an answer to the critical question of who owns the assets of the bank 
at any given time during the privatization period, which is already 
underway at a minimal statutory pace. Without a definitive and official 
determination of this central issue, it is not possible to formulate an 
informed position regarding privatization of the bank.
    NTCA believes any privatization plan should be well conceived 
before implementation. At the very least, privatization should proceed 
in an orderly fashion with a full accounting of the various financial 
and legal implications involved. Congress, RTB Stockholders, and the 
rural telecommunications industry deserve the benefit of having RTB 
privatization reviewed thoroughly, and not in the vacuum of the 
budgetary process. In addition to having a high concentration of RTB 
stockholders as members, NTCA itself is a RTB stockholder. The RTB's 
portfolio is currently valued at well over $2 billion and consequently 
it continues to play a critical role in the modernization of rural 
telecommunications infrastructure throughout the United States. For 
these reasons, the RTB's future will continue to be closely monitored, 
and protected, by NTCA and its members. Furthermore, NTCA urges 
Congress to refrain from commencing such deliberations without the 
asset question answered, or in an effort to simply respond to the 
administration's budget suggestion.
    Continue RUS Distance Learning and Telemedicine Loan and Grant 
Program The RUS Distance Learning and Telemedicine Loan and Grant 
program has proven to be an indispensable tool for rural development. 
In this regard, NTCA urges Congress to provide adequate funding for 
this critical program. NTCA supports the recommendations for this 
program that are contained in the president's budget proposal.
Preserve RBCS Rural Development Grant and Loan Programs
    Likewise, NTCA has witnessed the good these programs have done for 
rural communities. NTCA urges Congress to ensure funding is at levels 
that are adequate to meet current demand for the programs.
                               conclusion
    The RUS Telecommunications Loan Program bears a proud 50-year 
record of commitment, service, and achievement to rural America. Never 
in its entire history has the program lost even a dollar to abuse or 
default--an unparalleled feat for any government-sponsored lending 
program. Clearly such a successful program should remain in place to 
continue to ensure rural Americans have the opportunity to play a 
leading role in the information age in which we live. After all, an 
operational and advanced rural segment of the nation's 
telecommunications infrastructure is critical to truly ensuring that 
the national objective of universal telecommunications service is 
fulfilled. Please help us accomplish that objective.
                                 ______
                                 
   Prepared Statement of the National Utility Contractors Association
    Mr. Chairman and Members of the Subcommittee, my name is Andy 
Mayts. I am Director of Operations for Gigliotti Contracting North in 
Palm Harbor, Florida. Thank you for the opportunity to submit written 
testimony on behalf of the National Utility Contractors Association 
(NUCA) regarding the U.S. Department of Agriculture (USDA) Rural 
Utilities Service (RUS) Water and Waste Disposal infrastructure funding 
for fiscal 2000.
                       fiscal 2000 recommendation
    NUCA respectfully requests that the Committee reject the 
Administration's proposed 12 percent cut to the RUS Water and Waste 
Disposal loan and grant budget authority and appropriate, at minimum, 
the current funding level of $645 million for fiscal 2000.
    RUS Water and Waste Disposal loan and grant programs provide funds 
for small communities with 10,000 or fewer residents that cannot secure 
reasonable financing for drinking water and wastewater infrastructure 
improvements. As you well know, these are widely popular and successful 
programs among rural communities. In fact, currently there is a $3.2 
billion backlog of eligible applications for the grant ($1 billion) and 
loan ($2.2 billion) programs.
    For fiscal 2000, the President proposed $503 million in grants for 
water and waste disposal and $64 million in loans for water and waste 
disposal. We recognize that the fiscal 2000 subsidy rate of 7.1 
percent, as determined by the U.S. Office of Management and Budget, is 
such that the proposed cut does not result in a reduction in programs. 
But the President has failed to recognize the historic opportunity to 
capitalize on the low subsidy rate and make a big dent in the backlog 
of $3.2 billion of eligible loan and grant applications. As illustrated 
on the chart on the following page, merely maintaining the current 
funding level could provide an additional $766,590,520 to the RUS 
programs to tackle the backlog. Please compare:
    Assumptions: Row 1 reflects the fiscal 1999 Budget Authority of 
$645,007,000 and the fiscal 1999 subsidy rate of 16.52 percent. For 
fiscal 1999, grant programs assumed approximately 82 percent percent of 
the Budget Authority. Row 2 reflects the Administration proposal of 
$567 million for fiscal 2000, and the OMB subsidy rate of 7.10 percent. 
The Administration proposed $503 for RUS grants and $64 million for 
loans, thus grants assume 89 percent of the total proposed Budget 
Authority. Row 3 reflects NUCA's recommendation that the Committee 
maintain the current funding level, $645 million. It also assumes the 
OMB subsidy rate of 7.10 percent and allocates 89 percent of the total 
Budget Authority to grants. Row 4 reflects the current funding level, 
the fiscal 1999 percentage of grants of total Budget Authority (82 
percent), and the fiscal 2000 subsidy rate of 7.10 percent.

----------------------------------------------------------------------------------------------------------------
                                                                  Subsidy
         Fiscal year               Budget           Grants          rate          Loans         Program dollars
                                  authority                      (percent)
----------------------------------------------------------------------------------------------------------------
1999 actual..................    $645,007,000  $528,363,000....     16.52        $706,077,482     $1,234,440,482
                                               (at fiscal year
                                                1999, 82
                                                percent).
2000 Admin proposal..........    $567,000,000  $503,000,000....      7.10        $901,120,000     $1,404,120,000
                                               (at fiscal year
                                                2000, 89
                                                percent).
2000 at fiscal year 1999         $645,007,000  $574,056,230....      7.10        $998,986,842     $1,573,043,072
 funding.                                      (at fiscal year
                                                2000, 89
                                                percent).
2000 at fiscal year 1999         $645,007,000  $528,363,000....      7.10      $1,642,347,520     $2,170,710,520
 funding.                                      (at fiscal year
                                                1999, 82
                                                percent).
----------------------------------------------------------------------------------------------------------------

    The RUS Water and Waste Disposal programs are popular and important 
investments and have proven track records. They provided $28 billion in 
loans and grants to more than 12,500 communities across the country 
between 1965 and 1995. With a loan default rate of 0.1 percent and a 
repayment delinquency rate less than 2 percent, RUS loans and grants 
are wise investments in rural America.
         rural water and waste disposal needs and the rus cure
    NUCA is comprised of nearly 2,000 companies that build and maintain 
water, sewer, and other underground infrastructure systems in rural 
communities as well as in metropolitan areas nationwide. Every day of 
the week we witness the consequences of failed or nonexistent water and 
waste disposal infrastructure on the most dire of human needs--WATER! 
Without water, our bodies cease to function, and without clean water, 
our ability to live healthy, productive lives is diminished. Waterborne 
illness is a serious, life-threatening condition that affects nearly 1 
million people annually. Children and the elderly are particularly 
vulnerable because of weaker immune systems. Fortunately, there is a 
cure for this needless illness in rural America. RUS capital investment 
in water and waste disposal facilities (including solid waste disposal 
and storm drainage) is the first line of defense in protecting water 
quality and thus public health.
    Once the RUS investment is in place, additional dividends in the 
form of jobs, quality of life, environmental protection, and public 
safety are attained. The now-healthy workforce in what would be a high-
unemployment community can go to work. When $1 billion is invested in 
clean water infrastructure, as many as 57,400 jobs are created, and 
more than half of these jobs are permanent because new businesses 
relocate to the area and existing businesses expand operations. In 
rural communities where unemployment and poverty rates are much higher 
than the national average, RUS programs improve people's lives.
    RUS water and waste disposal loans and grants also provide for the 
everyday conveniences that you and I generally take for granted, such 
as the simple acts of watering the tomato plants, taking a shower, or 
making a pitcher of lemonade. The programs also protect the natural 
environment--often the very reason people wish to live in rural 
communities--from the degradation caused by untreated sewage and 
stormwater runoff tainted with chemicals and animal feces that 
contaminate waterways and groundwater supplies. Finally, public safety 
in the form of fire protection is enhanced by modern water storage and 
distribution systems. Leaking, clogged, and undersized water lines 
compromise water pressure and make it virtually impossible for 
firefighters to do their jobs. Similarly, aged water and sewer mains 
can burst and collapse, creating dangerous sinkholes and shutting off 
travel routes. These threats to public safety drive up the price of 
community services and homeowner insurance, hampering individuals and 
communities from achieving economic prosperity. If the public 
investment is made, however, it repays itself over time and produces 
lasting rewards for the community.
               rus proposal in relation to epa estimates
    There are an estimated 46,500 small drinking water systems in the 
United States serving 3,300 or fewer people. The Environmental 
Protection Agency's 1997 Drinking Water Needs Survey (EPA) projected 
more than $37.2 billion in needed infrastructure improvements for these 
systems over the next 20 years. In addition to these identified needs, 
a significant number of households are not served by a centralized 
water distribution and treatment facility. Some 15 million households 
use private wells, and another 1 million homes rely on untreated 
sources that include cisterns and water hauled from springs, rivers, 
and lakes.
    The EPA 1996 Wastewater Needs Survey estimates that small 
communities with 10,000 or fewer residents face more than $13.8 billion 
in capital costs over the next two decades for sewage collection and 
treatment works. That figure does not include an estimation of septic 
system needs. The total $51 billion is considered by most to be a 
conservative estimate. Thus, a $645 million investment for fiscal 2000 
is worth every penny.
              nuca clean water for rural america brochure
    Attached, please find a copy of one of NUCA's new brochures titled, 
Clean Water for Rural America. Our state chapters and members will 
share this information with other business leaders and public officials 
in the rural communities where they live and work. NUCA is pleased to 
serve as an information resource for this widely popular and beneficial 
program. We will also provide copies of the brochure to the full Senate 
and House.
                               conclusion
    We, the members of NUCA, urge you to reject the Clinton 
Administration's fiscal 2000 proposed cut to the RUS Water and Waste 
Disposal loans and grants programs and appropriate, at minimum, the 
current funding level, $645 million. These are important sources of 
financing for small, rural communities that have been turned down by 
more conventional lenders. The program has a solid track record in 
terms of loans repaid and maximum use of appropriated dollars. More 
than $50 billion in water and waste disposal needs exist in the 
communities RUS serves. And currently there is a backlog of more than 
$3.2 billion in eligible applications to be funded.
    Thank you for considering our recommendation.
                                 ______
                                 
         Prepared Statement of the National Watershed Coalition
    Mr. Chairman and members of the subcommittee: The National 
Watershed Coalition (NWC) is pleased to present this testimony in 
support of some of the most beneficial water resource conservation 
programs ever developed in the United States. The Coalition recognizes 
full well the need to use our tax dollars wisely. That makes the work 
of this Subcommittee very important. It also makes it imperative that 
the federal programs that are continued are those that provide real 
benefit to society, and are not programs that would be nice to have if 
funds were unlimited. We believe that the Small Watershed Program 
(Public Law 83-566) and the Flood Prevention Operations Program (Public 
Law 78-534) are examples of those rare programs that address our 
nation's vital natural resources which are critical to our very 
survival, do so in a way that provide benefits in excess of costs, and 
are programs that serve as models for the way all federal programs 
should work.
    The National Watershed Coalition is an alliance of national, 
regional, state and local organizations that have a common interest in 
advocating the use of the watershed when dealing with natural resource 
issues. We also support the use of total resource management principles 
in planning. We are advocates of both the Small Watershed Program and 
the Flood Prevention Operations Program administered by USDA's Natural 
Resources Conservation Service (NRCS). These resource protection 
programs deserve much higher priority than they have had in the recent 
past. Even in difficult financial times, and we keep hearing we are in 
a period of budget surpluses, their revitalization would pay dividends 
in monetary and other benefits, and jobs! The disastrous 1993 Midwest 
floods and the floods in Texas last fall, should have taught us 
something. If one examines the Report of the 1994 Interagency 
Floodplain Management Review Committee that studied the 1993 Midwest 
flood event, we see that flood damages were significantly reduced in 
areas where Public Law 566 projects were installed. The requests for 
disaster assistance were also less.
    The watershed as the logical unit for dealing with natural resource 
problems has long been recognized. Public Law 566 offers a complete 
watershed management approach, and should have a prominent place in our 
current federal policy emphasizing watersheds and total resource 
management based planning. Why should the federal government be 
involved with these watershed programs?
  --They are programs whose objectives are the sustaining of our 
        nation's precious natural resources for generations to come.
  --They are not federal, but federally assisted, locally sponsored and 
        owned. They do not represent the continued growth of the 
        federal government.
  --They are locally initiated and driven. Decisions are made by people 
        affected, and respect private property rights.
  --They share costs between the federal government and local people. 
        Local sponsors pay between 30--40 percent of the total costs of 
        Public Law 566 projects.
  --They produce net benefits to society. The most recent program 
        evaluation demonstrated the actual ratio of benefits to costs 
        was approximately 2.2:1. The actual adjusted economic benefits 
        exceeded the planned benefits by 34 percent. How many other 
        federal programs do so well?
  --They consider and enhance environmental values. Projects are 
        subject to the discipline of being planned following the 
        National Environmental Policy Act (NEPA), and the federal 
        ``Principles and Guidelines'' for land and water projects. That 
        is public scrutiny!
  --They are flexible programs that can adapt to changing needs and 
        priorities. Objectives that can be addressed are flood damage 
        reduction, watershed protection (erosion and sediment control), 
        water quality improvement, rural water supply, water 
        conservation, fish and wildlife habitat improvement, 
        recreation, irrigation and water management, etc. That is 
        flexibility.
  --They are programs that encourage all citizens to participate.
  --They can address the needs of low income and minority communities.
  --And best of all--they are programs the people like!
    The National Watershed Coalition commends the Congress for the 
support given these programs over the years, and hopes that the outcome 
of the fiscal year 2000 appropriations process will enable this vital 
work to continue and expand as we seek to preserve, protect and better 
manage our nation's water and land resources. Every State in the United 
States has benefited from the Small Watershed Program.
    In order to continue this high priority work in partnership with 
states and local governments, the Coalition recommends a fiscal year 
2000 funding level of $250 million for Watersheds and Flood Prevention 
Operations, Public Law 83-566 and Public Law 78-534. We recommend that 
$30 million of this amount be for Public Law 78-534 projects. We would 
also suggest that $60 million be used for structural rehabilitation and 
replacement, in accordance with H.R. 728 recently introduced in the 106 
Congress by Representative Frank Lucas of Oklahoma. We recognize that 
Congress may not find it possible to provide these amounts, but we also 
believe that we are not doing our job of helping you recognize the true 
need if we continually recommend the federal share of these needed 
funds be less. We would hope that everyone understand that these funds 
are only a part of the total that are committed to this vital purpose. 
The local project sponsors in these ``federally assisted'' endeavors 
have a tremendous investment also. Additionally, the Coalition supports 
$25.0 million for watershed planning, surveys and investigations. We 
also suggest that the Emergency Watershed Program (EWP) be provided 
with $20 million to allow the NRCS to provide rapid response in time of 
natural disaster. Our recommendations are considerably different from 
those proposed by the Administration for the fiscal year 2000 budget. 
Congress increasingly talks of wanting to fund those investments in our 
nation's infrastructure that will sustain us in the future. Yet this 
and past Administration's budgets have regularly cut funding for some 
of the best of these programs. This makes absolutely no sense! We 
continue to read that we are in a period of budget surpluses, almost as 
if the federal coffers were overflowing with cash, yet there is next to 
nothing for watershed protection and improvement. Our Gross Domestic 
Product has risen for about 93 straight months, unemployment is low, 
the stock market has risen to new highs, and we can't seem to invest 
and re-invest in our vital watershed infrastructure. That is simply 
unconscionable.
    The issue of the current condition of those improvements 
constructed over the last fifty years with these watershed programs is 
a matter of great concern. Many of the nearly 10,400 dams that NRCS 
assisted sponsors build throughout the United States no longer meet 
current dam safety standards and need to be upgraded to current 
standards. A USDA study published in 1991 estimated that in the next 
ten years, $590 million would be needed to protect the installed works. 
Of That amount, $100 million would come from local sponsors as their 
operation and maintenance contributions. NRCS also conducted a more 
recent survey, which indicated the current national needs were about 
$540 million. That is the reason we are recommending starting with $60 
million for the work necessary to protect these installed structures, 
and commend Oklahoma Representative Frank Lucas for his leadership in 
introducing H.R. 728, the Small Watershed Rehabilitation Amendments of 
1999. Watershed project sponsors throughout the US appreciate his 
leadership on this vital issue. If we don't start to pay attention to 
our rural infrastructure needs, the ultimate cost to society will only 
increase, and project benefits will be lost. This is a serious issue we 
hope you will recognize.
    In addition to offering our thoughts on needed conservation program 
budget levels, we would like to express our great concern with the way 
in which the Administration's budget proposes to change the watershed 
program funding in fiscal year 2000. We will address each ``account'' 
in some detail as to the adverse impacts we see.
Watershed and Flood Prevention Operations.
  --The Administration proposes $83,423,000, a decrease of $16,010,000 
        from the grossly inadequate funding of fiscal year 1999. They 
        talk of their concern for the environment, but it is not 
        reflected in their budget proposals.
  --All watershed funds would be transferred to the Conservation 
        Operations (CO) account. We believe again that this is another 
        attempt by the Administration to put these finds into an 
        account where they may not be used for Small Watershed 
        Projects. In our view this represents the desire of some in the 
        Administration to circumvent the will of Congress and eliminate 
        Small Watershed projects. We ask that you not allow this to 
        happen.
  --Of the funds proposed under the Public Law 566 authority, no funds 
        are specifically suggested for the Public Law 534 projects, 
        only $9 million is available from the Public Law 566 account 
        for Public Law 534 projects, a decrease of $6 million--or 40 
        percent --from fiscal year 1999. This is unacceptable.
  --No funding is proposed to address the aging watershed 
        infrastructure problem which poses great risk to human health, 
        safety and quality of life, and which we discussed earlier. We 
        suggest $60 million is needed in fiscal year 2000. Pass H.R. 
        728!
Watershed Surveys and Planning.
  --The Administration proposes $11,732,000 for these vital planning 
        activities, and we think $25 million is a more realistic figure 
        considering the need. There are many potential projects and 
        project sponsors in every state wanting watershed planning 
        assistance, and that assistance is not available. And this at a 
        time when our federal government is encouraging the watershed 
        approach and local leadership. Here we have the ideal 
        partnership cost-share program that encourages local 
        leadership, and the federal share of the funds is not there.
  --The Administration again proposes putting all these funds in the 
        Conservation Operations account, and we have the same concern 
        we expressed under watershed operations. This must not be 
        allowed to happen. We demand fiscal accountability!
Emergency Watershed Protection Program.
  --The Administration proposes no funds to maintain readiness to deal 
        with emergencies caused by natural disasters, or maintain any 
        technical staff capacity. This makes no sense! We suggest that 
        $20 million be put into this account to provide rapid early 
        response, and then deal with total disaster needs for each 
        incident with supplemental appropriations as in the past.
    There are a number of suggestions we would like to make concerning 
this very important legislation, that we will be making to other 
committee's and they have budget implications. We believe the 
objectives of this legislation should be expanded to include more non-
structural practices, allow the law to provide assistance in developing 
rural water supplies (without water there is no rural development) and 
eliminate the current requirement that mandates that twenty percent (20 
percent) of the total projects benefits be ``directly related to 
agriculture'' which can be very subjective and has the unintended 
effect of penalizing projects in poor, small, rural communities.
    The Coalition appreciates the opportunity to offer these comments 
regarding fiscal year 2000 funding for the water resource programs 
administered by the Natural Resources Conservation Service. With the 
``downsizing'' the NRCS has experienced, we would be remiss if we did 
not again express some concern as to their ability to provide adequate 
technical support in these watershed program areas. NRCS technical 
staff has been significantly reduced and budget constraints have not 
allowed that expertise to be replaced. Traditional fields of 
engineering and economics are but two examples. We see many states 
where the capability to support their responsibilities in these program 
areas is seriously diminished. This is a disturbing trend that needs to 
be halted. This downsizing has a very serious effect on state and local 
conservation programs. Local Watershed and Conservation Districts and 
the NRCS combine to make a very effective delivery system for providing 
the technical assistance to local people--farmers, ranchers and rural 
communities--in applying needed conservation practices. But that 
delivery system is currently very strained! Many states and local units 
of government also have complementary programs that provide financial 
assistance to land owners and operators for installing measures that 
reduce erosion, improve water quality, and maintain environmental 
quality. The NRCS provides, through agreement with the USDA Secretary 
of Agriculture, ``on the land'' technical assistance for applying these 
measures. The delivery system currently is in place, and by downsizing 
NRCS we are eroding the most effective and efficient coordinated means 
of working with local people to solve environmental problems ever 
developed. Our system and its ability to produce food and fiber is the 
envy of the entire world. In our view, these programs are the most 
important in terms of national priorities.
    We are also disappointed that the subcommittee has a practice of 
not accepting oral testimony from organizations such as the National 
Watershed Coalition. When we were allowed to make an oral presentation 
in the House, we were able to talk to subcommittee members who could 
ask us questions. It was a chance for them to actually talk with people 
doing the work on the land. That personal contact in both houses is now 
missing, and it would be easy to think that our written testimony may 
not be seriously considered. We hope you will reconsider this practice 
in future years, and again allow oral testimony.
    The Coalition pledges its full support to you as you continue your 
most important work.
    Our Executive Director/Watershed Programs Specialist Mr. John W. 
Peterson, who has over forty years experience in natural resource 
watershed conservation, is located in the Washington, DC area, and 
would be pleased to serve as a resource as needed. John's address is 
9304 Lundy Court, Burke, VA 22015-3431, phone 703-455-6886 or 4387, 
Fax; 703-455-6888, email: jwpeterson.erols.com.
    Thank you for allowing the National Watershed Coalition (NWC) this 
opportunity.
                                 ______
                                 
              Prepared Statement of the Nature Conservancy
    Mr. Chairman, and members of the Committee, I appreciate the 
opportunity to submit this testimony for the record on fiscal year 2000 
appropriations for the Natural Resources Conservation Service (NRCS).
    The Nature Conservancy is an international, non-profit organization 
dedicated to the conservation of biological diversity. Our mission is 
``to preserve the plants, animals and natural communities that 
represent the diversity of life on Earth by protecting the lands and 
waters they need to survive.'' The Conservancy has more than 900,00 
individual members and over 1,850 corporate sponsors. We currently have 
programs in all 50 states and in 17 nations. To date our organization 
has protected more than 9 million acres in the 50 states and Canada, 
and has helped local partner organizations preserve millions of acres 
overseas. The Conservancy itself owns more than 1,600 preserves--the 
largest private system of nature sanctuaries in the world. Three 
concepts have been fundamental to our success: sound science; strong 
partnerships with public and private landowners; and tangible results 
at local places.
    The Conservancy is deeply committed to working with agricultural 
producers to conserve biodiversity on private lands. We currently work 
with local landowners at approximately 75 sites across the country to 
implement conservation on the ground, and plan to increase this number 
to 500 sites within the next decade.
                             recommendation
The Conservancy recommends:
    Wetland Reserve Program WRP enrollment level of 209,000 acres in 
fiscal year 2000. In addition, we ask the committee not to use the WRP 
account to offset other expenditures.
    EQIP funding of $300 million for fiscal year 2000. We also urge the 
committee not to target EQIP to offset other expenditures.
    Full support to the President's budget request of $680 million in 
appropriations for the Natural Resources Conservation Service (NRCS). 
This appropriation supports principally the agency's basic conservation 
program, called Conservation Technical Assistance.
Wetland Reserve Program (WRP)
    The agriculture conservation program most important to the 
Conservancy is the WRP. This program makes a sizeable amount of money 
available to producers who enroll in the program after having concluded 
that the best economic return on their land would be from the receipt 
of program dollars rather than from crop or livestock production. 
Because wetlands provide excellent habitat for wildlife, the program 
serves the Conservancy's mission of habitat conservation, and at the 
same time provides farmers who elect to enroll in the WRP with the 
opportunity to generate income by renting WRP acres to hunting groups.
    The Conservancy strongly supports WRP because it is the only 
program administered by the U.S. Department of Agriculture that at 
least in part buys permanent protection for resource values on private 
lands. These values include: 1) conservation of wildlife habitat, 2) 
purification of groundwater runoff and, 3) regulation of the flow of 
water in watershed systems by storing surface and groundwater. 
Permanent protection of environmentally significant resources is the 
best investment of public conservation dollars. In these times of 
economic distress for many producers, making financial options 
available for producers that also results in conservation benefits for 
the general public is good public policy.
    The Conservancy asks that the committee not turn to the WRP account 
to offset expenditures in other program areas. We recognize that the 
budget caps set a difficult goal for Congress in crafting a budget for 
fiscal year 2000. Still, we believe that voluntary, cost-effective 
programs like the WRP must be made available to producers to conserve 
resources on private lands.
    The Conservancy recommends a WRP enrollment level of 209,000 acres 
in fiscal year 2000. Additionally, we are working with the Agriculture 
Committee to increase the number of acres that may be enrolled in the 
program and ensure that WRP continues to operate at an appropriate 
level in the future.
Environmental Quality Incentive Program (EQIP)
    The Conservancy seeks a $100 million increase in funding for EQIP 
for fiscal year 2000, for a total of $300 million. In addition, we urge 
the committee not to target EQIP to offset other expenditures. The 
agricultural conservation community recognizes the significant 
contribution made by farm runoff to the impairment of our nation's 
watersheds. An important strategy for addressing this problem must be 
voluntary farm runoff abatement measures, such as that provided by the 
EQIP program. The increased funding recommended will begin to help 
animal feeding operators in financial distress deal with regulatory 
pressure to keep water clean.
Conservation Technical Assistance
    Agricultural production depends on the conservation of the soil and 
water resource base. NRCS and the Conservancy both know that 
conservation will succeed ultimately only to the extent that it also 
serves the need of producers to engage in economically viable farming. 
NRCS has a relationship of trust with private landowners that is 
unusual among federal agencies. It takes a non-regulatory, voluntary 
approach to conservation. The voluntary conservation programs 
administered by NRCS, along and the Conservation Reserve Program 
administered by the Farm Service Agency, provide farmers with highly 
effective tools for conserving soil and water resources.
    NRCS provides Conservation Technical Assistance through their 
district conservationists, who give free advice to producers interested 
in managing the natural resources on their land. In addition, district 
conservationists provide a number of products requested by producers. 
These include conservation management systems for a variety of land 
types, irrigation water management plans, animal waste management 
plans, program eligibility determinations, wetland creation or 
restoration plans, conservation education, and long-term strategic 
resource planning to individuals and communities.
    Congress appropriated $641 million for the agency in fiscal year 
1999. The current demand for these services approximately doubles NRCS' 
ability to provide them. The Conservancy believes that if NRCS is not 
funded at a level sufficient to provide these services, the resource 
base on private lands will be impaired and biodiversity will be put at 
greater risk. In particular, NRCS will have difficulty providing 
technical assistance in support of the Wetland Reserve Program (WRP) 
and the Conservation Reserve Program (CRP) in the absence of full 
funding of the Conservation Technical Assistance account.
    A comprehensive clean water policy at the federal level must 
include funding for the tools that enable producers to implement 
voluntarily conservation practices and regulatory activities. An 
increase in appropriations for Conservation Technical Assistance is 
needed this year in particular because of the increased requirements 
for animal feeding operators to change practices that affect water 
quality.
    We appreciate the support that you have shown for agriculture 
conservation through the years, and appreciate this opportunity to 
present a written statement to your committee. The Conservancy looks 
forward to working with you on these issues in this and future 
agriculture appropriations bills.
                                 ______
                                 
     Prepared Statement of the Organization for the Promotion and 
           Advancement of Small Telecommunications Companies
                           summary of request
    The Organization for the Promotion and Advancement of Small 
Telecommunications Companies [OPASTCO] seeks the Subcommittee's support 
for fiscal year 2000 loan levels for the telecommunications program 
administered by the Rural Utilities Service [RUS] in the following 
amounts:

Telecommunications Loans Program

5 percent hardship loans................................     $75,000,000
Treasury rate loans.....................................     300,000,000
guaranteed loans........................................     120,000,000
Rural Telephone Bank [RTB] loans........................     175,000,000

    In addition, OPASTCO requests the Subcommittee's support for the 
following: removal of the statutory 7 percent cap on Treasury rate 
loans for fiscal year 2000; a prohibition on the transfer of 
unobligated RTB funds to the general fund of the Treasury; and, funding 
of the distance learning and telemedicine grant and loan program at 
sufficient levels.
                                general
    OPASTCO is a national trade association of approximately 500 
independently owned and operated telephone companies serving rural 
areas of the United States. Its members, which include both commercial 
companies and cooperatives, together serve over 2,000,000 customers in 
42 states. Well over half of OPASTCO's members are RUS or RTB 
borrowers.
    Perhaps at no time since the inception of the RUS (formerly the 
REA] has the telecommunications program been so vital to the future of 
rural America. The telecommunications industry is at a crossroads, both 
in terms of technology and public policy. Advances in 
telecommunications technology in recent years will deliver on the 
promise of a new ``information age.'' The Federal Communication 
Commission's [FCC] implementation of the landmark Telecommunications 
Act of 1996, as well as modernization resulting from prior statutory 
changes to RUS's lending program, will expedite this transformation. 
However, without continued RUS and RTB support, rural telephone 
companies will be hard pressed to build the infrastructure necessary to 
bring their communities into this new age, creating a bifurcated 
society of information ``haves'' and ``have-nots.''
    Contrary to the belief of some critics, RUS's job is not finished. 
Actually, in a sense, it has just begun. We have entered a time when 
advanced services and technology--such as broadband fiber optics, 
digital switching equipment, custom calling features, and the 
Internet--are an expected and needed part of a customer's 
telecommunications service. Unfortunately, the inherently higher costs 
of upgrading rural networks has not abated. Rural telecommunications 
continues to be more capital intensive and involves fewer paying 
customers than its urban counterpart. RUS borrowers average only 6.3 
subscribers per route mile versus 130 subscribers per route mile for 
large local exchange carriers. In order for rural telephone companies 
to modernize their networks and provide their customers with advanced 
services at reasonable rates, they must have access to reliable low-
cost financing.
    The relative isolation of rural areas increases the value of 
telecommunications services for these citizens. Telecommunications 
enables applications such as distance learning and telemedicine that 
can alleviate or eliminate some rural disadvantages. Telecommunications 
can also make rural areas attractive for some businesses and result in 
revitalization of the rural economy. For example, businesses such as 
telemarketing and tourism can thrive in rural areas, and telecommuting 
can become a realistic employment option.
    While it has been said many times before, it bears repeating that 
the RUS telecommunications loans and RTB programs are not grant 
programs. The funds loaned by RUS are used to leverage substantial 
private capital, creating public/private partnerships. For a very small 
cost, the government is encouraging tremendous amounts of private 
investment in rural telecommunications infrastructure.
    Most importantly, the programs are tremendously successful. 
Borrowers actually build the infrastructure and the government gets 
paid back with interest. There has never been a default in the history 
of the lending programs.
        recent legislation has heightened the need for the rus 
                    telecommunications loans program
The Telecommunications Act of 1996
    The FCC's implementation of the Telecommunications Act of 1996 will 
only increase rural telephone companies' need for RUS assistance in the 
future. The forward-looking Act defines universal service as an 
evolving level of telecommunications services that the FCC must 
establish periodically, taking into account advances in 
telecommunications and information technologies and services. While the 
competitive environment engendered by the 1996 Act may offer the means 
of meeting this definition in urban areas, rural and high cost areas 
have less potential for economically sound competitive alternatives. 
RUS now has an essential role to play in the implementation of the new 
law, as it will compliment new funding mechanisms established by the 
FCC and enable rural America to move closer to achieving the federally 
mandated goal of rural/urban service and rate comparability.
    At present, considerable regulatory uncertainty exists for rural 
telephone companies as several critical FCC proceedings implementing 
the 1996 Act remain unresolved. These include fundamental changes to 
the universal service and access charge systems and the procedures 
incumbent carriers use to separate their costs between the Federal and 
state jurisdictions. In addition, uncertainty exists as to whether 
rural incumbent carriers will be able to recover the costs of the 
extensive regulatory obligations and potential infrastructure 
development demands placed on them under the Act. If, as it presently 
appears, these outstanding issues are resolved in a piecemeal fashion 
and/or with a strong bias toward new entrants, rural incumbent carriers 
with universal service obligations could be hampered in their ability 
to modernize their networks and provide quality, affordable service to 
all of their customers. Managed sequencing and coordination of existing 
proceedings is necessary if the Commission is to achieve Congress's 
public policy goals of affordable rates and access to an evolving 
telecommunications network for all Americans. Equally important is for 
Congress to monitor the FCC's implementation of the Act to ensure that 
all of its goals--including universal service, an even playing field 
for competition, and deregulation--are realized in rural areas.
                                 relra
    Working in tandem with the 1996 Act, the Rural Electrification Loan 
Restructuring Act of 1993 [RELRA] will further help to ensure the 
comparability of telecommunications service between urban and rural 
America. As a prerequisite to eligibility for insured and RTB loans, 
RELRA requires that every state have an RUS approved modernization plan 
which provides a timeline for the improvement of the state's 
telecommunications network and assures that the purpose of every loan 
is consistent with achieving the requirements of the borrower's state 
plan. These plans set forth the requirements for the transmission of 
video images and high speed data that will promote educational and 
health care opportunities as well as provide the necessary 
infrastructure for economic development. Implementation of these plans 
has already begun to generate additional loan demand as rural telephone 
systems strive to meet the increased service objectives in the rural 
areas they serve.
    a $75 million loan level should be maintained for the 5 percent 
                         hardship loan program
    One of the most vital components of RUS's telecommunications loans 
program is the 5 percent hardship loan program. These loans are 
referred to as hardship loans for good reason: They provide below-
Treasury rate financing to telephone companies serving some of the most 
sparsely populated, highest cost areas in the country. The commitment 
these companies have to providing modern telecommunications service to 
everyone in their communities has made our nation's policy of universal 
service a reality and, in many cases, would not have been possible 
without RUS's hardship loan program. Companies applying for hardship 
loans must meet a stringent set of eligibility requirements and the 
projects to be financed are rated on a point system to ensure that the 
loans are targeted to the most needy and deserving. For fiscal year 
1999, the government subsidy needed to support a $75,000,000 loan level 
was under $7,500,000. Given the necessity of this indispensable 
program, it is critical that the loan level be maintained at 
$75,000,000 for fiscal year 2000.
removal of the 7 percent cap on treasury rate loans should be continued
    With regard to RUS's Treasury rate loan program, OPASTCO supports 
the removal of the 7 percent ceiling on these loans for fiscal year 
2000. This Subcommittee appropriately supported language in the fiscal 
year 1996 Agriculture Appropriations Act to permit Treasury rate loans 
to exceed the 7 percent per year ceiling contained in the authorizing 
act. This language was continued in fiscal year 1997, 1998, and 1999. 
Were long-term interest rates to exceed 7 percent, adequate subsidy 
would not be available to support the Treasury rate loan program at the 
authorized levels. Accordingly, OPASTCO supports the continuation of 
this language in the fiscal year 2000 appropriations bill in order to 
prevent potential disruption to this important program.
 the prohibition on the transfer of any unobligated balance of the rtb 
   liquidating account to the treasury and requiring the payment of 
              interest on these funds should be continued
    OPASTCO urges the Subcommittee to reinstate the language introduced 
in the fiscal year 1997 Agriculture Appropriations Act, and continued 
in fiscal year 1998 and 1999, prohibiting the transfer of any 
unobligated balance of the RTB liquidating account to the Treasury or 
the Federal Financing Bank which is in excess of current requirements 
and requiring the payment of interest on these funds. As a condition of 
borrowing, the statutory language establishing the RTB requires 
telephone companies to purchase Class B stock in the bank. Once all 
loans are completely repaid, a borrower may then convert its Class B 
stock into Class C stock. Thus, all current and former borrowers 
maintain an ownership interest in the RTB. As with stockholders of any 
concern, these owners have rights which may not be abrogated. The 
Subcommittee's inclusion of the aforementioned language into the fiscal 
year 2000 appropriations bill will ensure that RTB borrowers are not 
stripped of the value of this required investment.
the administration's proposal to fund the rtb's administrative expenses 
   and subsidy from the bank's liquidating account should be rejected
    As it did last year, the Subcommittee should reject the 
Administration's proposal to fund the RTB's administrative expenses and 
subsidy budget authority through the bank's liquidating account 
balances. The Administration's proposal is inappropriate on both legal 
and policy grounds. Statutorily, the Rural Electrification Act provides 
for the RTB's use of facilities and services of employees of the 
Department of Agriculture, without cost to the RTB, until such time as 
the bank is privatized. The proposal also appears inconsistent with the 
bifurcated structure of the RTB under the Federal Credit Reform Act of 
1990 which does not permit funds in the liquidating account to finance 
new loans. From a public policy standpoint, unobligated balances of the 
liquidating account have been targeted to support the privatization of 
the RTB and use of these funds for other purposes would only serve to 
dilute the value of the bank for all stockholders. Finally, paying for 
the RTB's administrative expenses and subsidy through the liquidating 
account offers no budgetary savings. For these reasons, OPASTCO is 
opposed to the Administration's proposal and urges the Subcommittee to 
continue to fund the RTB through the general fund of the Treasury.
 the distance learning and telemedicine program should continue to be 
                       funded at adequate levels
    In addition to RUS's telecommunications loans program, OPASTCO 
supports adequate funding of the distance learning and telemedicine 
grant and loan program authorized in the Federal Agriculture 
Improvement and Reform Act of 1996. This sensible investment allows 
rural students to gain access to advanced classes which will help them 
prepare for college and jobs of the future. Also, rural residents will 
gain access to quality health care services without traveling great 
distances to urban hospitals. Loans are made at the government's cost-
of-money, which should help to meet demand for the program in the most 
cost effective way. In light of the Telecommunications Act's 
requirement that schools, health care providers, and libraries have 
access to advanced telecommunications services, sufficient targeted 
funding for this purpose is essential in fiscal year 2000.
                               conclusion
    The development of the nationwide telecommunications network into 
an information superhighway, as envisioned by policymakers, will help 
rural America survive and prosper in any market--whether local, 
regional, national, or global. However, without the availability of 
low-cost RUS funds, building the information superhighway in 
communities that are isolated and thinly populated will be untenable. 
By supporting the RUS telecommunications programs at the requested 
levels, the Subcommittee will be making a significant contribution to 
the future of rural America at a negligible cost to the taxpayer.
                                 ______
                                 
Prepared Statement of the Pharmaceutical Research and Manufacturers of 
                                America
    On behalf of the Pharmaceutical Research and Manufacturers of 
America (PhRMA), I present recommendations on the fiscal year 2000 
budget request submitted by the Administration for the Food and Drug 
Administration, for inclusion in the Subcommittee hearing record. PhRMA 
represents the country's leading research-based pharmaceutical and 
biotechnology companies, which are devoted to investing more than $24 
billion annually in discovering and developing new medicines. PhRMA 
companies are leading the search for new cures and treatments.
    We recognize the difficulties confronting the Subcommittee in 
meeting overall domestic spending caps affecting programs under your 
jurisdiction, under the 1997 budget agreement. We also recognize that 
pressures on appropriators to ensure an appropriate level of U.S. 
defense spending is likely to be even greater in light of the recent 
military activity with NATO. Decisions about which domestic programs to 
maintain or increase thus will be even more difficult. We urge you, 
however, to remember that many of the fruits of biomedical research are 
brought to the bedsides of patients through the research and 
development of new pharmaceuticals and through actions by the FDA to 
bring those safe and effective medicines to patients as soon as 
possible. To achieve this translation of medical research into better 
health for our citizens requires a commitment to appropriate funding 
for FDA.
    That is why PhRMA fully supports the Administration's fiscal year 
2000 request for budget authority specifically for direct federal 
appropriations of $1.016 billion (excluding rental payments of $95 
million) for FDA salaries and expenses. This account is the major and 
essential component of FDA's resources, and the budget request 
represents a $128 million increase over the appropriations enacted by 
Congress for the current fiscal year under Public Law 105-227.
    This level of funding is particularly important under the 
``trigger'' provisions of the 1997 FDA Modernization Act (FDAMA) if the 
pharmaceutical industry is to continue to be required to pay the user 
fees that have enabled FDA to make new life-saving, cost effective 
medicines available to patients much more quickly. The trigger 
provisions require that general fund appropriations for all FDA 
salaries and expenses must equal or exceed the fiscal year 1997 
appropriation level (excluding user fees), as adjusted for inflation or 
changes in discretionary budget authority for overall domestic 
spending, beginning after fiscal year 1997.
    As FDA Commissioner Jane E. Henney, M.D., noted in her recent 
prepared testimony before your Subcommittee, FDA's dedication to the 
health and safety of the American people is well established. It is 
America's most important consumer protection agency. The FDA regulates 
products that account for one-quarter of all consumer spending and that 
comprise about $1 trillion in sales--including foods, medical and 
radiological devices, medicines, animal drugs, and cosmetics. These are 
goods that Americans expect to be safe and reliable.
    However, Congress has imposed increasing responsibilities on FDA's 
staff during the past decade--most recently, under FDAMA and the Animal 
Drug Availability Act. For example, FDAMA requires that FDA inspect 
establishments that make drugs and devices every two years. But between 
1990 and 1998, the number of firms subject to inspections reportedly 
rose from 89,000 to 114,000--a 28 percent increase.
    In addition, the agency has had to respond quickly to an increasing 
variety of new public health issues, such as ensuring the safety of 
food and the nation's blood supply. For these reasons, it is of 
critical importance that FDA be able to retain and recruit highly 
qualified staff.
    The research-based pharmaceutical and biotechnology industries are 
particularly concerned that FDA be able to continue to meet highly 
important performance goals, mutually agreed upon in an historic 
compact between FDA, Congress and industry. The agreement was first 
reached in 1992 in the Prescription Drug User Fee Act (PDUFA) and was 
confirmed in 1997 under FDAMA as PDUFA ll. The total FDA ``program'' 
request for salaries and expenses in fiscal year 2000 includes 
authorized appropriations of over $145 million for PDUFA II user fees--
an increase of some $13 million over the current fiscal year, to add 
staff to handle vitally important drug reviews. During fiscal year 
1998-2002, pharmaceutical companies will pay over $550 million in user 
fees under FDAMA, so FDA can continue to reduce both review and overall 
drug development times. As FDA Commissioner Henney has testified:
    ``PDUFA is among the most successful agency programs in history. 
Within its first five years of implementation, the increased resources 
provided by PDUFA to hire additional review staff has resulted in 
cutting the average review times for new drugs, without compromising 
the high standards that FDA has traditionally applied in weighing the 
risks and benefits of new drugs and thereby in determining their safety 
and effectiveness.''
    Under PDUFA, the pharmaceutical industry and FDA are continuing to 
work to serve a common client--the patient. The industry is working to 
develop new and better drugs, FDA is striving to improve the drug 
development and review process.
    The critical importance of this partnership, in cooperation with 
Congress, in delivering new medicines to patients as soon as possible 
cannot be overemphasized. The 30 new drugs and 9 new biologics approved 
by FDA in 1998 are to treat diseases that affect 180 million patients 
and that cost more than $400 billion a year. New treatments include 
medicines for patients suffering from AIDS, cancer, including breast 
cancer, cardiovascular disease, Crohn's disease, tuberculosis, 
rheumatoid arthritis, depression, Parkinson's disease, erectile 
dysfunction, and the first vaccines to prevent Lyme disease and 
retrovirus infection. The prescription drug user fee program--which 
must be sharply distinguished from proposals for general purpose user 
fees--is based on three key principles:
  --User fees must supplement FDA appropriations, not substitute for 
        them.
  --User fees must be targeted to the review and approval of innovative 
        prescription medicines and their supplemental indications, and 
        are not to be used for general agency activities.
  --User fees must be applied to meet specific performance goals, 
        agreed upon by FDA, to ensure the timely review and approval of 
        new drugs.
    Before user fees, FDA review times averaged about 30 months. But 
the 30 drugs approved in 1998 were reviewed in an average of 11.7 
months--slightly better than the 12-month goal specified in PDUFA II. 
FDA also exceeded the fiscal year 1998 goal to review 90 percent of all 
standard new drug and biologic applications within 12 months, by 
completing 100 percent of the reviews within this timeframe.
    The prescription drug user fees collected in fiscal year 2000 will 
enable FDA to continue to meet its PDUFA II performance goals, 
including:
  --Review and act upon 90 percent of standard original NDA and PLA/BLA 
        submissions filed during fiscal year 2000 within 12 months of 
        receipt, and review and act on 50 percent within 10 months of 
        receipt.
  --Review and act on 90 percent of priority original drug NDA and 
        biotechnology BLA submissions filed during fiscal year 2000 
        within six months of receipt.
  --Review and act on 90 percent of standard drug efficacy supplements 
        filed during fiscal year 2000 within 12 months of receipt, and 
        review and act on 50 percent within 10 months of receipt.
    Review and act on 90 percent of priority drug efficacy supplements 
filed during fiscal year 2000 within six months of receipt.
    What this means is that FDA can continue to build on its record of 
helping patients to obtain new medicines more than a year and a half 
sooner than they did before user fees were enacted, while maintaining 
its high standards of safety and effectiveness.
    In addition, FDAMA contains important provisions that facilitate 
access by patients to experimental drugs; give FDA more flexibility in 
determining effectiveness; expand access by doctors to peer-reviewed 
medical information; and encourage the development and testing of 
medicines for children.
    The U.S. system of new drug approvals is the most rigorous in the 
world. On average, a company invests about $500 million and takes about 
12-15 years to discover and develop a new drug. Only five in 5,000 
compounds that enter preclinical testing make it to human testing. And 
only one of these five is approved for use by patients.
    R&D investment by research-based pharmaceutical firms continues to 
break records. In 1999, pharmaceutical companies will invest $24 
billion to discover and develop important new medicines. That figure 
represents a 14.1 percent increase over last year's record setting R&D 
spending. And no industry devotes a higher percentage of sales to R&D--
20.8 percent--than the research-based pharmaceutical industry.
    However, the pharmaceutical industry's ever increasing R&D 
investment, and FDA's determined efforts to improve the drug 
development and review process, will be nullified if adequately 
increased baseline appropriations for all of the agency's programs are 
not provided.
    For these reasons, PhRMA strongly urges that Congress appropriate 
$1.016 billion (exclusive of rental payments) in fiscal year 2000 for 
FDA salaries and expenses, as requested by the Administration, to 
ensure that the agency can fulfill its vital responsibilities to 
promote and protect the health and safety of the American people.
                                 ______
                                 
         Prepared Statement of the Red River Valley Association
    Mr. Chairman and members of the Committee. I am Lynn Lowe, and I am 
pleased to represent the Red River Valley Association as its President. 
Our organization was founded in 1925 with the express purpose of 
uniting the citizens of Arkansas, Louisiana, Oklahoma and Texas to 
develop the land and water resources of the Red River Basin.
    As an organization that knows the value of our precious water 
resources we support the most beneficial water and land conservation 
programs administered through the Natural Resources Conservation 
Service (NRCS). We understand how important a balanced budget is to our 
nation; however, we cannot sacrifice what has been accomplished. The 
NRCS programs are a model of how conservation programs should be 
administered and our testimony will address the needs of the nation as 
well as our region. We believe strongly that the whole, national 
program must be preserved.
    We appreciate that the fiscal year 2000 President's budget 
increases the NRCS overall funding; however, some programs are NOT 
adequately funded, to the detriment of the agency and our citizens. The 
increases are earmarked for grants, financial assistance and other non-
federal personnel items. The effect is a decrease of funds for direct 
technical assistance. It is imperative to understand that NRCS is 
funded by program and not by employees.
    We would like to address several of the programs affected by the 
President's fiscal year 2000 budget proposal. Failure to fund these 
initiatives would reduce assistance to those who need it.
    1. Conservation Operations Budget.--This has been a steady decline 
in real dollars over the past several years. This has happened partly 
as a result of dollars being diverted from Conservation Operations to 
fund newer programs, especially the increases in financial assistance 
for conservation. The recent Workload Analysis conducted by NRCS shows 
that nationally the needs by private land users for conservation 
services of all the kinds provided by NRCS exceeds the funded levels by 
$300 million. RRVA supports the increase in the Conservation Operations 
budget for NRCS by $300 million per year beginning in fiscal year 2000.
    The Conservation Operations budget of NRCS is the foundation of 
technical support for conservation to the private users and owners of 
land in the United States. The President's Clean Water Action Plan and 
the Unified Strategy for Animal Feeding Operations will rely heavily on 
the technical assistance provided through NRCS's Conservation 
Operations program. Increases in other programs such as EQIP will not 
make up for the declines in Conservation Operations.
    Another factor which has seriously reduced the ability of NRCS to 
meet the considerable demands for its technical assistance is the 
limitation on funding which can be provided to NRCS due to the Section 
11 cap on transfer of funds from the Community Credit Corporation 
(CCC). The CCC provides the funding for NRCS technical assistance for 
several programs including EQIP and CRP. Currently, this cap prevents 
NRCS from covering its staff costs for these crucial programs. We 
support the lifting of the Section 11 cap.
    2. Watershed and Flood Prevention Operations (Public Laws 566 & 
534).--More than 10,400 individual structures have been installed 
nationally. They have contributed greatly to environmental enhancement, 
economic development and the social well being of our communities. More 
than half of these structures are over 30 years old and several hundred 
are approaching their 50 year planned life.
    These programs offer a complete watershed management approach and 
should continue for the following reasons:
  --They protect people and communities from flooding.
  --Their objectives sustain our nation's natural resources for future 
        generations.
  --They are federally assisted and do not grow the federal government.
  --Initiatives and decisions are driven by the communities.
  --They are cost shared.
  --They follow NEPA guidelines and enhance the environment.
  --They can address the needs of low income and minority communities.
  --The benefit to cost ratio of this program has been evaluated to be 
        2.2:1. What other federal programs can claim such success?
    There is no doubt of the value of this program. The cost of losing 
this infrastructure exceeds the cost to reinvest in our existing 
watersheds. Without repairing and upgrading the safety of existing 
structures we will miss the opportunity to keep our communities alive 
and prosperous. It would be irresponsible to dismantle a program that 
has demonstrated such great return and is wanted by our citizens.
    We fully support H.R. 728, recently introduced by Representative 
Frank Lucas (R-OK). This is a crucial bill to address a serious 
problem.
    In addition to the needs for reinvesting in existing infrastructure 
there are many new projects which are awaiting funds to be built. The 
present level, outlined in the budget, of $83 million is not adequate. 
We strongly recommend that a funding level of $250 million be dedicated 
to Flood Prevention Public Law 534 and Watershed Operations Public Law 
566. This is more realistic and compares to the programs appropriated 
in the years prior to 1997. At the proposed funding level it would take 
over 30 years to complete just the identified projects, with no 
attention given to rehabilitation needs.
    3. Emergency Watershed Protection Program.--This program comes 
under Watershed and Flood Prevention Operations, but is a separate line 
item. This has been a zero budget item; however, there will always be 
emergency needs. It is estimated that $80 million was spent in fiscal 
year 1998 and funds are already being used for this purpose in fiscal 
year 1999.
    As our land use expands, to include sensitive environmental 
ecosystems, major weather events will have an adverse impact requiring 
NRCS to assist under this program; therefore it should be funded up 
front. It is important for NRCS to be prepared for a rapid response. 
With funds available they can react immediately to any emergency when 
it occurs.
    We request that a minimum of $50 million be appropriated for this 
program in the fiscal year 2000 budget and that these funds are not 
taken from elsewhere in the NRCS budget.
    4. Conservation Reserve Program (CRP).--This program, administered 
by Farm Services Agency, impacts NRCS the most. NRCS conducts and is 
reimbursed for the technical assistance of this program.
    In fiscal year 1999 approximately 6.8 million acres was enrolled 
into CRP. Only 1.8 million acres will be enrolled in fiscal year 2000 
as the Congressionally mandated cap is reached.
    This reduction in the program would mean a loss of about 1,000 
staff years nationwide. This is a tremendous loss in manpower, all 
realized at the field level where technical assistance is most 
valuable. You cannot allow this to occur.
    We request that, as a minimum, the CRP cap be increased to 45 
million acres. This is an extremely beneficial program to our nation 
and should not be allowed to expire. It provides a safety net to those 
farmers trying to make a living on the marginal lands most suited for 
this program.
    5. Watershed Survey and Planning.--This was budgeted by the 
President at $11.7 million and is an extremely important community 
program. NRCS has used this to become a facilitator for the different 
community interest groups, state and federal agencies.
    It is imperative that our communities conduct proper water resource 
planning as they grow. The consequences for the lack of planning will 
be detrimental. Watershed Survey and Planning insures that water 
resource issues are addressed, bringing the community leaders, agencies 
and interest groups together.
    As our municipalities expand the water resource issues tend to be 
neglected until a serious problem occurs. Proper planning and 
cooperative efforts, through this program, can prevent problems and 
insure the water resource issues are met.
    We request that this program be funded at a level of $15 million.
    6. Forestry Incentives Program.--The President's budget has no 
funding for this program. Congress transferred this program to NRCS 
from the Farm Service Agency as a restructuring in the Federal 
Agricultural Improvement and Reform Act of 1996. Forestry on small, 
privately owned lands is recognized as a farming activity. NRCS is the 
best agency to administer this program which assists farmers in 
production agriculture.
    It is more than just a timber production program. Forests are the 
most effective land users as they relate to water quality, non point 
source pollution, air quality, greenhouse gas reduction and wildlife 
habitat. The fact that this program pertains to small, privately owned 
forests is another important aspect. Even though the initial impact is 
on wood fiber production, without it the landowners may sell the land 
for other development or misuse the resource jeopardizing water quality 
and proper runoff practices. This is a needed conservation program.
    We request Congress to fund the Forestry Incentives Program at a 
level of $6.5 million for fiscal year 2000.
    7. Environmental Quality Incentives Program (EQIP).--Requests for 
assistance through the EQIP program have been overwhelming. The 
resulting requests far exceed the available funds and is an additional 
workload on NRCS's delivery system. Additionally, the Administration 
must provide adequate funding for technical assistance to implement the 
program. We are appreciative that the President's fiscal year 2000 
budget increases the program by $126 million but the technical 
assistance must be set and maintained at a minimum of 19 percent of the 
total program, or $57 million. In essence, the program, or workload, 
cannot be increased while the technical assistance is reduced, as was 
attempted in fiscal year 1999.
    It appears that EQIP will be the primary means of supporting the 
voluntary portion of the Unified National Strategy for Animal Feeding 
Operations. Implementation of this strategy will greatly increase the 
demands for EQIP funds and technical services. Funding for NRCS to 
staff the technical assistance part is critical for the success of 
EQIP.
    The $300 million proposed for the EQIP program is an adequate 
budget for fiscal year 2000; however, we request that the technical 
assistance for this program be a minimum of $57 million.
    8. Wetlands Reserve Program (CCC).--As the WRP reaches its mandated 
cap in fiscal year 2000 the cap must be raised. This is a very popular 
and important program. It serves as a safety net to those farmers 
trying to make a living on these marginal lands. It also addresses 
conservation needs from water quality to global warming. The 
President's budget increased the program in fiscal year 2000 by $100 
million to $209 million. In addition, the budget only allows for $11.8 
million for technical assistance when a minimum of $18.3 million is 
required for NRCS to support this level of sign up.
    We agree with the funding level for this program; however, the 
acreage cap will be met in fiscal year 2000. We strongly recommend that 
the program be amended to add 1 million acres. This will allow the 
program to continue until fiscal year 2002 when a reauthorization for 
the program can be made.
    9. Conservation Technical Assistance (CTA).--A further reduction to 
technical assistance will jeopardize the local, state and federal 
partnership in conservation making it impossible to meet this nation's 
commitment to land stewardship in a voluntary manner. CTA provides 
landowners one-on-one assistance in planning and application of 
practice to protect our natural resources. The President's fiscal year 
2000 budget degrades this assistance. Much of the funds will be used 
for grants and ``passed through'' for use other than field delivery 
staff. After analysis of the proposed budget NRCS would actually be 
reduced by 1,055 staff years. You and our nation cannot allow this 
reduction in service and conservation management to happen.
    Over 70 percent of our land is in private ownership. This is 
important to understanding the need for NRCS programs and technical 
assistance. Their presence is vital to ensuring sound technical 
standards are met in our conservation programs. These programs not only 
address agricultural production, but sound natural resource management. 
Without these programs and NRCS properly staffed to implement them many 
owners of our private lands will not apply conservation measures needed 
to sustain our natural resources for future generations.
    The administration has proposed ``new'' Clean Water Initiatives, 
but why do they ignore the agency that has a proven record for 
implementing conservation watershed programs? Congress must decide: 
will NRCS continue to provide the leadership within the communities to 
build upon the partnerships already established? The President's 
proposal does not provide for that leadership and so it is up to 
Congress to insure NRCS is properly funded and staffed to provide the 
needed help to our taxpayers for conservation programs.
    All these programs apply to the citizens in the Red River Valley 
and we are concerned for the future. The RRVA is dedicated to work 
toward the programs which will benefit our citizens and provide for 
high quality of life standards. We therefore request that you 
appropriate the required funding levels within the individual programs 
to insure our nation's conservation needs are met.
    Attached is a summary of the additions and amendments we believe 
should be made to the President's budget to insure that NRCS remains 
funded to deliver America's conservation services and programs to our 
citizens.
    I thank you for the opportunity to present this testimony on behalf 
of the members of the Red River Valley Association and we pledge our 
support to assist you in the appropriation process.

Red River Valley Association Summary of Budget Request, Fiscal Year 2000 
Appropriations, Natural Resource Conservation Service (NRCS)

Appropriations:
    President's fiscal year 2000 Budget.................  $1,601,000,000
    Conservation Operations (President's Budget--$680.7 
      million) Additional Request.......................     300,000,000
    Watershed and Flood Protection Operations:
        Public Law 566 & Public Law 534 (President's 
          Budget--$83 million) Additional Request.......     167,000,000
        Emergency Watershed Protection Program..........      50,000,000
    Watershed Survey and Planning (President's Budget--
      $11.7 million) Additional Request.................       3,300,000
    Forestry Incentive Program..........................       6,500,000
    Wetlands Reserve Program (Tech Asst, President's 
      Budget--$11.8 million) Additional Technical 
      Assistance........................................       6,500,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total NRCS fiscal year 2000 Appropriation.......  $2,134,300,000
                    ========================================================
                    ____________________________________________________
Technical Assistance: Environmental Quality Incentives 
    Program Technical Assistance (Min 19 percent of the 
    proposed budget)....................................      57,000,000
Acreage Cap Increases:
    Conservation Reserve Program........................      45,000,000
    Wetland Reserve Program.............................       1,000,000

Grant Disclosure: The Red River Valley Association has not received any 
federal grant, subgrant or contract during the current fiscal year or 
either of the two previous fiscal years.
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                                 ______
                                 
          Prepared Statement of the Catfish Farmers of America
    Mr. Chairman and Members of the Subcommittee, I appreciate the 
opportunity to provide testimony in support of the USDA Regional 
Aquaculture Center program. My name is Hugh Warren, and I am Executive 
Vice President of the Catfish Farmers of America. Founded in 1968, and 
with current membership from 30 states, the Catfish Farmers of America 
is the trade organization that represents the interests of the farm-
raised catfish industry.
    Production of farm-raised catfish has increased over SO-fold since 
1970, a rate of growth unmatched in other segments of domestic 
agriculture. Per capita consumption of farm-raised catfish ranks fifth 
among all seafood products in the United States, behind tuna, shrimp, 
pollock, and salmon. Because farm-raised catfish has become a widely 
accepted food item throughout much of the United States, the demand for 
catfish should continue to increase as American consumers increasingly 
turn toward fish as part of their overall diet.
    The rapid growth of the catfish industry has brought about a 
pressing need for research to make farming more efficient and to assure 
the continued production of a safe, healthy food for American 
consumers. The Southern Regional Aquaculture Center has become an 
important part of that research support as Center programs are 
responsive to industry needs within the region, and projects are 
conducted as cooperative, interstate projects that ensure that the best 
scientific talent in the region is brought to bear on the problem in a 
cost-efficient manner. I would like to highlight two projects developed 
through the Southern Regional Aquaculture Center that illustrate the 
response of the program to important national and regional issues.
    Production of safe, high-quality products is the foremost goal of 
fish farmers. Through the Southern Regional Aquaculture Center, 
research and extension scientists from Alabama, Georgia, Louisiana, 
Mississippi, Tennessee, Texas, and Virginia evaluated methods of 
detecting pathogenic microorganisms and reducing spoilage of farmed 
raised channel catfish, trout, and crawfish. Packaging techniques 
developed through this project have been implemented in commercial 
processing plants throughout the country, and have helped to improve 
shelf-life on many aquaculture products. More than 100 scientific and 
lay publications were developed through this project, and have provided 
critical information on processing, temperature control, spoilage, 
purchasing, storage, handling, and preparation of aquaculture products. 
This project has helped assure the quality and safety of aquaculture 
products.
    Producing food in an environmentally sound manner is another 
fundamental goal of American aquaculture. Research and extension 
scientists in Alabama, Arkansas, Florida, Georgia, Louisiana, 
Mississippi, North Carolina and South Carolina recently cooperated in a 
Southern Regional Aquaculture Center project to evaluate waste 
management practices that reduce the impact of aquaculture on the 
environment. Results of the project showed that aquaculture ponds can 
be operated with minimal impact on the environment by using simple 
management practices that can be implemented with little or no extra 
expense or labor. These practices have been widely adopted in the 
southeast because aquaculture producers are aware that the use of 
environmentally responsible farming practices can be part of the 
marketing appeal of farm-raised fish.
    Funding for the Regional Aquaculture Center program has been level 
for the past decade. Over that time, domestic aquaculture has grown at 
a remarkable rate and the cost of conducting research has increased. 
Accordingly, it has become increasingly difficult for the Center 
program to address the needs of this important segment of American 
agriculture. I respectfully request your sincere consideration of the 
Regional Aquaculture Centers in the fiscal year 00 budget, and I urge 
you to provide funding at the full authorized level of $7.5 million for 
the five Regional Centers.
                                 ______
                                 
Prepared Statement of the Second Harvest National Network of Food Banks
    Chairman Cochran, Ranking Member Kohl, and Members of the 
Subcommittee, thank you for the opportunity to submit this written 
testimony before the Subcommittee.
    Second Harvest is the nation's largest hunger relief charity. Our 
network is compromised of nearly 200 regional certified affiliate food 
banks, which provide more than one billion pounds of food and grocery 
products to an estimated 50,000 local private charitable agencies, 
operating 95,000 social service programs. Second Harvest network food 
banks provide assistance in all 50 states, the District of Columbia and 
Puerto Rico.
    On behalf of Second Harvest and its member food banks, I want to 
express our deep gratitude to each of you for your attention to the 
needs of the food banks in your state and their efforts to feed 
America's hungry. America's food banks have more nutritious, higher 
quality and greater quantities of food because of your work.
    To cite just one example, in your state Mr. Chairman, the 
Mississippi Food Network, led by Mr. John Alford, provides food and 
grocery products to more than 350 local charities around the state and 
distributed more than 6 million pounds in federal commodities to needy 
Mississippians in 1997. The efforts of Mr. Alford's food bank, its 
network of churches and local agencies and thousands of volunteers, is 
made more effective through the distribution of USDA commodities made 
possible by this Subcommittee. Thank you.
    In 1998, through the generosity of private donations and the grant 
of federal commodities through the Emergency Food Assistance Program 
(TEFAP), our network provided food to an estimated 26 million low-
income Americans, including 21 million people who were aided at 
emergency feeding sites such as soup kitchens, food pantries, and 
emergency shelters.
    Mr. Chairman, I submit my testimony today urging the Subcommittee 
to fund TEFAP at the level recommended by the Administration, $100 
million for commodity food assistance and $45 million for 
administrative funds. The need for adequate TEFAP funding is essential 
to our food banks and the hungry Americans they serve.\1\
---------------------------------------------------------------------------
    \1\ HUNGER 1997: The Faces & Facts. The Second Harvest National 
Research Study, 1998.
---------------------------------------------------------------------------
    Last year, Second Harvest released HUNGER: The Faces & Facts, 
independent research providing the most comprehensive review of the 
private sector response to the problem of hunger ever conducted in the 
United States. What our research provided--and what I hope will 
influence the fiscal year 2000 appropriations process now being 
considered by this Subcommittee--is important demographic information 
about hungry Americans and the local charities that serve them.
    What our research found was that disproportionately higher 
percentages of women, children, and elderly people are served at 
emergency feeding sites than are represented in the general US 
population. They are typically the poorest of the poor, with more than 
86 percent with incomes below the federal poverty level and more than 
11 percent with no income in the past month at all. These are our 
nation's most vulnerable families, and they rely heavily on the 
assistance of community based charities like the local food bank.
    We also find ``working poor'' families being served through food 
pantries. Increasingly, these working poor are being fed at soup 
kitchens that were once almost exclusively utilized by homeless people. 
Working poor households represent more than one-third of emergency food 
recipients. They are people who are working, paying taxes and 
contributing to the productivity and economic prosperity of our nation, 
but are reaping few of the rewards. A recent study in Virginia found 
that half of all people relying on food pantries and other local 
feeding agencies had been employed in the past six months.\2\ 
Unfortunately, the economic boats of these working Americans have not 
been lifted by the rising tide of our nation's current economic boom.
---------------------------------------------------------------------------
    \2\ The Promise and the Reality, The Outlook for Virginians Leaving 
Welfare, Campaign for Virginians in Need and Social Action Linking 
Together, 1998.
---------------------------------------------------------------------------
    The ranks of the working poor that turn to charities for aid is 
also increasing through the often-difficult transition from welfare to 
work. A South Carolina Department of Social Services report found that 
17 percent of former welfare recipients had no way to buy food some of 
the time, since leaving welfare.\3\ A recent study in Massachusetts 
found that 10 percent of former welfare recipients reported having gone 
hungry, and the length of time former recipients went without food grew 
to 10 days in some cases.\4\ In each of these states food banks have 
reported significant increased demand for emergency food services.
---------------------------------------------------------------------------
    \3\ Survey of Former Family Independence Program Clients Whose 
Cases Were Closed Between January and March 1997. South Carolina 
Department of Social Services 1998.
    \4\ Life After Welfare: Still Poor, Still Hungry. Massachusetts Law 
Reform Institute and the Family Economic Institute, Boston, MA. 1999.
---------------------------------------------------------------------------
    Food banks have become an essential component in the public-private 
partnership that has emerged in the efforts of local communities to end 
hunger. In 1998, the Second Harvest network distributed approximately 
1.2 billion pounds of food to local charities with an estimated value 
of $1.5 billion. More than 85 percent of all the food and grocery 
products distributed throughout our network are provided by the private 
sector. Two-thirds of all private sector donations to food banks come 
through local activities such as canned food drives, church and 
synagogue sponsored activities, local grocery retailers and 
wholesalers, local food manufacturers and processors, and farmers who 
make available their fields for a ``second harvest'' for the needy in 
their communities.
    Despite the generous donation of food and grocery products by the 
private sector, we are finding increased demand for emergency food 
assistance that is outstripping our available resources. The Hunger 
1997 Second Harvest report provides quantifiable data showing a 
substantial shortage of emergency food aid in the charitable sector.
    Our research findings have been confirmed by other human service 
organizations that have experienced similar shortages of emergency 
food. For example, Catholic Charities USA reported in December 1997 
that the number of people receiving emergency food assistance at 
Catholic Charities sites increased by 14 percent since 1995.\5\
---------------------------------------------------------------------------
    \5\ Catholic Charities USDA, 1996 Annual Survey (December 1997).
---------------------------------------------------------------------------
    Similarly, the US Conference of Mayors Annual Survey of Hunger and 
Homelessness found that emergency food assistance was up 14 percent in 
1998.\6\ Eighty-four percent of the cities surveyed reported increased 
demand for emergency food among families with children. And, due to 
insufficient stocks of emergency food, emergency feeding agencies were 
forced to turn away one in five individuals in cities surveyed.
---------------------------------------------------------------------------
    \6\ U.S. Conference of Mayors, A Status Report on Hunger and 
Homelessness in America's Cities, 1998.
---------------------------------------------------------------------------
    We estimate that in 1997, approximately 16 percent of requests for 
emergency food aid went unmet. Nearly half (46 percent) of all local 
agencies reported that they were forced to stretch food resources in 
the past year. Moreover, emergency food pantries experienced shortages 
most often, with nearly 60 percent reporting that they have had to 
stretch food at some time in the past year, and 17 percent stretching 
food resources monthly.
    Local agencies reporting a need for additional food resources were 
asked to estimate the amount of additional food needed. Based on those 
agency reports, researchers were able to project a national shortage of 
900 million pounds of emergency food. In the worst instances, local 
charities can no longer stretch food resources and are forced to 
operate on a sort of ``triage'' system, serving only the most needy, or 
the charity simply closes. Our research found that a median number of 
20 people were turned away last year by those food programs lacking 
sufficient food resources to serve them. In 1997, at least 115,000 
people were turned away and denied emergency food assistance because 
the local charitable agency had no food available.
    Mr. Chairman, it should be noted that it takes a serious and nearly 
insurmountable shortage of donated food to force a charity to turn a 
needy person away, or, worse yet, close a soup kitchen, pantry or 
emergency shelter. The director of soup kitchen or church food pantry 
will go to extraordinary efforts before they will accept that they must 
turn someone away or close their doors for even a short period of time.
    Mr. Chairman, the depth of the emergency food shortage is profound 
and provides a compelling argument for the subcommittee to fully fund 
TEFAP to the Administration's request of $100 million in commodity food 
donations and $45 million in administrative funding. This is the same 
TEFAP mandatory funding level provided for in fiscal year 2000 through 
the Personal Responsibility Work Opportunity Reconciliation Act (Public 
Law 104-193). We cannot cut emergency food assistance at a time when 
food banks, food pantries and soup kitchens are reporting that 
approximately 16 percent of emergency food requests currently go unmet.
    TEFAP is the cornerstone program in the charitable efforts to feed 
America's hungry, and is the ``bridge'' between public and private 
hunger relief efforts. TEFAP is a unique community based and community 
supported federal nutrition program, which relies on volunteers at food 
banks and local agencies to prepare and distribute federally donated 
agricultural commodities to hungry people in those communities.
    TEFAP serves the public good in two primary and important ways: 
high quality, nutritious food gets to hungry Americans in an efficient 
manner utilizing the assistance and efficiencies of the private sector, 
and the agricultural economy is strengthened through surplus removal 
and providing a non-competitive market for agricultural commodities. A 
1994 USDA--Economic Research Service report stated ``although TEFAP's 
sector-wide farm impacts are small because the program is small, 
producers of the commodities donated through TEFAP can be significantly 
affected ... as a surplus disposal program TEFAP returned to farmers 
approximately 85 cents for every dollar of Federal TEFAP expenditure.'' 
\7\ TEFAP provides increased farm-gate income and serves as direct 
connection between America's farmers and hungry Americans in a manner 
that few federal programs can.
---------------------------------------------------------------------------
    \7\ Comparing the Emergency Food Assistance Program and the Food 
Stamp Program, USDA-ERS Agricultural Economic report Number 689, 6/94; 
page 7.
---------------------------------------------------------------------------
    In fiscal year 1998, TEFAP commodities (purchased and bonus) 
represented more than 15 percent of all the food supplied through the 
Second Harvest network. Nearly 190 million pounds of TEFAP food--the 
equivalent of 148 million meals--was distributed through the Second 
Harvest network last year. We estimate that a similar level of TEFAP 
commodities (150 million to 180 million pounds) will be distributed 
through the network of food banks in fiscal year 1999, based on 
projections of surplus commodities available through Section 32 of the 
Agricultural Act of 1935.
    Though USDA commodities seemingly represent a proportionally small 
amount of the total food distributed through our network, TEFAP 
commodities are critical in that they help stabilize a massive system 
of unpredictable donated supplies that are typical in a charitable 
network such as ours.
    According to our research, the types of food most needed by local 
charities, primarily meat, dairy, fish, fruits and vegetables, and 
grain products, are almost exclusively the commodities provided through 
TEFAP. Those are also the least likely types of food to be donated in 
significant quantities or with any kind of regularity. This year, 
nearly two dozen types of nutritious commodities will be available to 
food banks through TEFAP mandatory commodity purchases.
    Americans are a fair, compassionate and generous people, and it is 
through their kind donations of food, funds, and volunteer time that 
food banks are able to come to the aid of the 21 million low-income 
people with emergency hunger relief. But, more must be done. Hunger 
relief charities are the last line of defense against hunger in most 
American communities, and too many needy people have already been 
turned away for a lack of food and resources.
    I am mindful of the difficult fiscal constraints faced by this 
Subcommittee. But I am also aware of the even more difficult reality of 
21 million Americans that turn to us for aid and help in their hunger. 
We cannot allow these vulnerable and needy people to be turned away. 
TEFAP is essential to our ability to feed America's hungry. I urge you 
to not cut TEFAP, and allow the mandatory funding paid for in the 1996 
Welfare Reform Act to proceed through the Committee without reduction.
    In light of the nation's considerable agricultural surpluses and 
the first federal budget surplus in three decades, it is morally 
unacceptable that there are tens of thousands of American children that 
may go to bed tonight because they have no food in their home or 
because the church pantry they have visited is empty. The TEFAP program 
is an essential component in our work. Please fund the program no less 
than the Administration's request.
    Mr. Chairman, I ask that the following two front-page articles from 
the New York Times, (2/26/99 and 2/27/99) be submitted with my 
testimony for the hearing record. These articles provide additional 
information that I sincerely hope will help guide the Subcommittee in 
its deliberations on fiscal year 2000 TEFAP funding.
    Thank you Chairman Cochran, Ranking Member Kohl and Members of the 
Subcommittee.
                                 ______
                                 
          Prepared Statement of the Seminole Tribe of Florida
    The Seminole Tribe of Florida is pleased to submit this statement 
regarding the fiscal year 2000 budget for the Natural Resources 
Conservation Service (NRCS) in the Department of Agriculture. The Tribe 
asks that Congress provide $946 million for NRCS's Conservation 
Operations Partnership; this request exceeds fiscal Year 1999 spending 
levels by $300 million. The Seminole Tribe's agricultural enterprises 
and environmental programs benefit from the technical assistance the 
NRCS provides through its Conservation Operations Partnership. 
Recently, the Tribe has been working closely with the Florida State 
Conservationists on a number of 1996 Farm Bill programs and anticipates 
increased technical assistance needs in the coming fiscal year.
                     the seminole tribe of florida
    The Seminole Tribe lives in the Florida Everglades. The Big Cypress 
Reservation is located in the western basins, directly north of the Big 
Cypress National Preserve. The Everglades provide many Seminole Tribal 
members with their livelihood. Our traditional Seminole cultural, 
religious, and recreational activities, as well as commercial 
endeavors, are dependent on a healthy Everglades ecosystem. In fact, 
the Tribe's identity is so closely linked to the land that Tribal 
members believe that if the land dies, so will the Tribe.
    During the Seminole Wars of the 19th Century, our Tribe found 
protection in the hostile Everglades. But for this harsh environment 
filled with sawgrass and alligators, the Seminole Tribe of Florida 
would not exist today. Once in the Everglades, we learned how to use 
the natural system for support without harm to the environment that 
sustained us. For example, our native dwelling, the chickee, is made of 
cypress logs and palmetto fronds and protects its inhabitants from the 
sun and rain, while allowing maximum circulation for cooling. When a 
chickee has outlived its useful life, the cypress and palmetto return 
to the earth to nourish the soil.
    In response to social challenges within the Tribe, we looked to our 
Tribal elders for guidance. Our elders taught us to look to the land, 
for when the land was ill, the Tribe would soon be ill as well. When we 
looked at the land, we saw the Everglades in decline and recognized 
that we had to help mitigate the impacts of man on this natural system. 
At the same time, we acknowledged that this land must sustain our 
people, and thereby our culture. The clear message we heard from our 
elders and the land was that we must design a way of life to preserve 
the land and the Tribe. Tribal members must be able to work and sustain 
themselves. We need to protect the land and the animals, but we must 
also protect our Tribal farmers and ranchers.
    Recognizing the needs of our land and our people, the Tribe, along 
with our consultants, designed a plan to mitigate the harm to the land 
and water systems within the Reservation while ensuring a sustainable 
future for the Seminole Tribe of Florida. The restoration plan will 
allow Tribal members to continue their farming and ranching activities 
while improving water quality and restoring natural hydroperiod to 
large portions of the native lands on the Reservation and ultimately, 
positively effecting the Big Cypress National Preserve and Everglades 
National Park.
    The Seminole Tribe's project addresses the environmental 
degradation wrought by decades of federal flood control construction 
and polluted urban and agricultural runoff. The interrupted sheet flow 
and hydroperiod have stressed native species and encouraged the spread 
of exotic species. Nutrient-laden runoff has supported the rapid spread 
of cattails, which choke out the periphyton algae mat and sawgrass 
necessary for the success of the wet/dry cycle that supports the 
wildlife of the Everglades.
    The Seminole Tribe designed an Everglades Restoration project to 
allow the Tribe to sustain ourselves while reducing impacts on the 
Everglades. The Seminole Tribe is committed to improving the water 
quality and flows on the Big Cypress Reservation. We have already 
committed significant resources to the design of this project and to 
our water quality data collection and monitoring system. We are willing 
to continue our efforts and to commit more resources, for our cultural 
survival is at stake.
    In addition to addressing the ecosystem concerns related to the Big 
Cypress Reservation, the Tribe has been actively involved in the 
development of the ecosystem-wide restoration plan. The Tribe, as an 
active member of both the Governor's Commission for a Sustainable South 
Florida and the South Florida Ecosystem Restoration Task Force and 
Working Group, has worked cooperatively with our neighbors to design a 
sustainable future for all of South Florida.
            seminole tribe everglades restoration initiative
    The Tribe has developed a conceptual water conservation plan that 
will enable us to meet new water quality standards essential to the 
cleanup of our part of the Everglades ecosystem and to plan for the 
storage and conveyance of our water rights. We have also designed, with 
the assistance of the NRCS, the Tribe's best management practices 
program. We continue to use available funds to further the design and 
planning work necessary to implement our Everglades Restoration 
Initiative.
    The Tribe's Everglades Restoration Initiative is designed to 
mitigate the degradation the Everglades has suffered through decades of 
flood control projects and urban and agricultural use and ultimately to 
restore the nation's largest wetlands to a healthy state. Our 
Everglades Restoration Initiative will enable the Tribe:
  --to collect and monitor data to establish a baseline and to evaluate 
        performance of the overall system design;
  --to design and construct surface water management systems to remove 
        phosphorus, convey and store irrigation water, improve flood 
        control, and rehydrate the Big Cypress National Preserve;
  --to commit to the long-term operation and maintenance of new water 
        management systems; and
  --to design and implement comprehensive best management practices for 
        the Big Cypress Reservation.
    This project will enable the Tribe to meet proposed numeric target 
for low phosphorus concentrations that is being used for design 
purposes by state and federal authorities. It will also provide an 
important public benefit: a new system to convey excess water from the 
western basins to the Big Cypress National Preserve, where water is 
vitally needed for rehydration and restoration of lands within the 
Preserve.
Conclusion
    Everglades restoration is a well-recognized national priority. 
Through its assistance to the Tribe, NRCS has provided valuable 
technical assistance to date. The Tribe anticipates that beginning in 
fiscal year 1999, NRCS will provide programmatic support through EQIP 
and WRP. In the following fiscal year, the Tribe anticipates additional 
programmatic assistance through the implementation of a significant 
portion of the Tribe's water conservation plan through the small 
watershed program as authorized through Public Law 566. None of the 
joint objectives of the Tribe and the NRCS can be accomplished, 
however, without sufficient funding of the Florida Conservationist's 
technical assistance budget.
    The Seminole Tribe is ready, willing, and able to begin work 
immediately. Doing so will require substantial commitments from the 
Tribe, including the dedication of over 9,000 acres of land for water 
management improvements. However, if the Tribe is to move forward with 
its contribution to the restoration of the South Florida ecosystem, a 
substantially higher level of federal financial assistance will be 
needed as well.
    The Tribe has demonstrated its economic commitment to the 
Everglades Restoration effort; the Tribe is asking the federal 
government to also participate in that effort. This effort benefits not 
just The Seminole Tribe, but all Floridians who depend on a reliable 
supply of clean, fresh water flowing out of the Everglades, and all 
Americans whose lives are enriched by this unique national treasure.
    Thank you for the opportunity to present the request of the 
Seminole Tribe of Florida. The Tribe will provide additional 
information upon request.
                                 ______
                                 
  Prepared Statement of the Society for Animal Protective Legislation
    We respectfully request the following modest appropriations and 
oversight to permit these programs within the U.S. Department of 
Agriculture to be carried out effectively and efficiently.
 $13 million appropriation for aphis/animal care to enforce the animal 
                              welfare act
    APHIS/Animal Care is responsible for ensuring basic protections to 
millions of animals nationwide through enforcement of the federal 
Animal Welfare Act (AWA). The Animal Care program oversees the care and 
handling of animals used in research, exhibition, and the wholesale pet 
trade. More than 10,000 separate locations across the country must be 
inspected for compliance with the AWA by Animal Care's field staff of 
only 70 inspectors. A total of 100 inspectors are desperately needed 
for USDA to meet their responsibilities under the law.
    Animal Care's dedicated, hard-working staff are struggling to do 
the best possible job despite woefully insufficient funding, but they 
have reached a limit on what they can squeeze our of their 
appropriation. The agency's responsibilities have grown over time, yet 
its current budget is below the fiscal year 1993 level.
    An unprecedented list of 350 organizations including the American 
Veterinary Medical Association, the American Zoo and Aquarium 
Association, the National Association for Biomedical Research and the 
Society for Animal Protective Legislation are supporting a request for 
an increase in appropriations for Animal Care of $3.825 million for its 
enforcement of the AWA. A copy of the letter is attached to my 
testimony.
    A budget of $13 million for fiscal year 2000 for Animal Care would 
ensure compliance with the law by permitting: regular unannounced 
inspections of all entities regulated under the Animal Welfare Act; 
increased vigilance at substandard facilities; prompt response to 
complaints; and increased attention to searches for unlicensed dealers 
and exhibitors.

Allocation for USDA/APHIS Animal Care of Additional $3.825 Million for 
Fiscal Year 2000

Field Inspection Staff Expansion:
    18 Veterinary Medical Officers (salary and benefits)--
      69,696  18.....................................$1,254,528
    12 Animal Care Inspectors (salary and benefits)--49,212 
       12............................................   590,544
    Transportation, equipment, phone and on-line service, and 
      training for new spectors 25,245  30...........   757,350
                    --------------------------------------------------------------
                    ____________________________________________________

        Subtotal.............................................. 2,602,422
Critical Needs of Existing Animal Care Program:
    Current Field Inspection Staff Needs: adequate training to 
      permit performance-based inspections; upgrading 
      computers and computer training to permit acquisition, 
      transfer and storage of data; repair and acquisition of 
      vehicles; equipment; supplies including gas; overnight 
      travel; and departmental services.......................   972,600
    Crisis Management: emergency funds for seizure and 
      subsequent care of animals; containment of potential 
      public or animal health threats; consulting fees for 
      veterinary specialists; emergency travel; and other 
      services as needed......................................   250,000
                    --------------------------------------------------------------
                    ____________________________________________________

        Subtotal.............................................. 1,222,600
                    --------------------------------------------------------------
                    ____________________________________________________

        Total................................................. 3,825,022

    The breakdown of expenses for each of the 30 new members of the 
field staff is as follows: $15,935 for acquisition of a vehicle; $4,860 
for a laptop computer; $2,210 for job and computer training; $1,490 for 
gasoline; and $750 for phone and on-line service. The total for 
individual expenses is $25,245  30 inspectors equals $757,350.
    The breakdown of expenses for existing program needs is as follows: 
$467,900 for repair, and when necessary acquisition, of vehicles; 
$175,000 for computer upgrades and training; $109,400 for overnight 
travel; $105,000 for job training including specialized training in 
enforcement of performance-based standards; $69,800 for departmental 
services; and $45,500 for equipment (cameras, etc.) and supplies. The 
total of these expenses is $972,600.
    Congress and USDA should support H.R. 453 to save money and 
strengthen enforcement of the Animal Welfare Act.--Last month another 
USDA licensed Class B random source dog dealer and 8 accomplices were 
convicted of charges related to theft of animals for sale to 
experimental laboratories. According to the U.S. Department of Justice, 
the dealer conspired with others to acquire dogs through deception and 
theft and conspired to falsify the records of acquisition required by 
Animal Care. Only 3 pets were reunited with their families; the others 
had already been experimented on by researchers and were euthanized. 
This case exemplifies the problems associated with random source dog 
and cat dealers who provide these animals for research purposes.
    There are only 40 random source Class B dog and cat dealers left, 
but Animal Care is spending an inordinate amount of time and money 
attempting to get them to comply with the minimum requirements under 
the AWA, including one of the fundamental objectives of the Act: 
preventing the theft of pets for research purposes. Despite all of the 
time and attention Animal Care is putting into enforcing the law at 
Class B dealer facilities, Animal Care is not able to assure the public 
that pets are not being taken and sold for research as the former USDA-
licensed dealer cited above did.
    H.R. 453, The Pet Safety and Protection Act sponsored by House 
Agriculture Committee Members Charles Canady and George Brown, would 
end the supply of dogs and cats to research facilities by Class B 
dealers. Other sources will remain available to ensure that researchers 
will be able to obtain the dogs and cats they need for experimentation. 
Report language could offer support for H.R. 453; adoption of this 
legislation would greatly reduce USDA's regulatory burden, while still 
permitting research to continue unhindered.
     $900 thousand line item appropriation for the animal welfare 
        information center at the national agricultural library
    In 1985, Congress had the ingenuity to create the Animal Welfare 
Information Center (AWIC) to serve as a resource for all individuals 
involved in the care and use of animals in research. Those who use the 
services of AWIC include scientists, veterinarians, animal caretakers, 
research facility administrators, members Institutional Animal Care and 
Use Committees and APHIS/Animal Care inspectors who are responsible for 
enforcing the Animal Welfare Act.
    AWIC provides information on : (a) appropriate care for animals 
including minimization of pain and distress, (b) reduction and/or 
replacement of the use of animals in research where possible, (c) 
preventing unintended duplication of experiments, (d) training for 
employees in the laboratory, and (e) legal requirements regarding the 
use of animals in research. Its value to the research community has led 
to an ever-increasing demand for assistance.
    AWIC has not received an increase in appropriations during its 12 
years, making it impossible to provide services as needed. Lack of 
funds is restricting the Center's ability to publish critical 
documents. Travel to important national meetings has been cut back too. 
At the most recent annual meeting of the American Association for 
Laboratory Animal Science, the AWIC educational exhibit was being run 
by only one, extremely overworked employee, and he ran out of AWIC's 
extremely popular materials during the first day of the three day 
meeting. The Center had to cut back on employees and cease its work 
study program with students from Prince Georges County schools.
    The Center staff have responded to more than 24,000 requests for 
specific publications and more than 2,000 requests for reference 
services. AWIC produces a bulletin, now in its ninth year. It also 
maintains a worldwide web site (http://www.nal.usda.gov/awic) which by 
the end of February was being used an average of nearly 900 timers per 
day!
    A line item appropriation of $900 thousand is requested for AWIC to 
increase production and dissemination of its excellent information. 
AWIC's resources are vital to assist registered research facilities 
with compliance with the Animal Welfare Act and to encourage the 
replacement, reduction and refinement of experiments involving the use 
of animals.
$500 thousand appropriation for aphis/animal care to enforce the horse 
                             protection act
    The Horse Protection Act (HPA), passed in 1970 and amended in 1976, 
is intended to prevent the cruel practice of ``soring'' gaited horses. 
According to APHIS, soring is defined as ``the application of any 
chemical or mechanical agent used on any limb of a horse or any 
practice inflicted upon the horse that can be expected to cause it 
physical pain or distress when moving.'' Soring is done to give the 
animal an exaggerated gait. Tennessee Walking horses are the common 
victims.
    It has been almost 30 years since the HPA was signed into law, yet 
many competitors in the industry are still defying the law. Horse 
Industry Organizations should adopt a policy of ``zero tolerance'' for 
violators of this federal law, and they should shun individuals who are 
soring horses. Instead, industry representatives appear to be bent on 
weakening enforcement of the HPA to make it easier to violate the law 
with impunity.
    APHIS' Horse Protection Enforcement reports to Congress repeatedly 
document the soring of hundreds of horses; the National Horse Show 
Commission, Heart of American Walking Horse Association and Spotted 
Saddle Horse Breeders and Exhibitors Association consistently have high 
turndown rates because of noncompliance with the law.
    The lack of funds has made it necessary for APHIS to increasingly 
turn over enforcement of the law to industry. This trend has continued 
despite evidence that the industry has failed to achieve the level of 
enforcement of the unbiased, well-trained, professional inspectors who 
work for Animal Care. The inspectors from industry are called 
``Designated Qualified Persons'' (DQPs). The rate at which DQPs turned 
down horses for soring in fiscal year 1997 was 1.42 percent, less than 
half the rate of government inspectors who had a turndown rate of 3.57 
percent.
    541 horse industry organization shows took place in fiscal year 
1997, yet Animal Care veterinary inspectors were only able to inspect 
31. Based on APHIS figures for the horse shows that are inspected, we 
estimate that at least 2,000 sore horses a year are going undetected. 
Additional resources are needed to permit Animal Care inspectors to 
attend more shows thereby ensuring significantly stronger compliance 
with the HPA.
                increased oversight of wildlife services
    Last year, the House of Representatives nearly slashed funding for 
the predator control field operations of Wildlife Services (WS). Many 
Members supported this effort because of the inhumane, ineffective 
methods of predator control used by WS. Development of effective, 
publicly acceptable, humane alternatives is essential by the research 
section of WS. As these alternatives are developed they must be 
implemented in the field.
    Steel jaw leghold traps, notorious for their cruelty, have been 
condemned as ``inhumane'' by the American Veterinary Medical 
Association, the American Animal Hospital Association and the World 
Veterinary Association. Not surprisingly, an increasing number of 
states are prohibiting use of leghold traps, making the work of the 
research section of WS all the more critical.
    The 30,000 steel traps owned by WS should be discarded in favor of 
less cruel alternatives such as footsnares and box traps. The 
successful development of tranquilizer tabs by the research section 
must continue and use of the tabs by the operations staff should be 
pursued.
    In an international trapping ``Understanding'' reached on December 
11, 1997, between the U.S. and the European Union, the U.S. agreed to 
phase out use of ``conventional steel-jawed leghold restraining 
traps''. WS has the responsibility of complying with the U.S. 
obligation by ending its use of these barbaric traps.
    No further testing of leghold traps should be pursued by WS as this 
would be an extremely wasteful and cruel use of taxpayer funds.--In the 
past, such funds designated for trap research were merely passed on to 
a nongovernmental organization to utilize as it saw fit. If any funds 
are allocated for trap testing, the research should be conducted by WS 
since the agency has the technical expertise.
    WS has been involved in extremely successful oral rabies vaccine 
programs. Despite the positive results to date, the Agency has 
suggested that funding would be reduced for this work. Funding for the 
oral rabies vaccine work is important and should be continued.
    Thank you for your consideration of our requests.
                                 ______
                                 
                Prepared Statement of Suffolk County, NY
    Mr. Chairman, my name is Robert J. Gaffney and I am the County 
Executive of Suffolk County, New York. I want to thank you for the 
opportunity to present the following testimony in support of the 
Federal Farmland Protection Program.
    Suffolk County was first settled in 1640 and was incorporated in 
1683 as one of the ten original counties in New York State. Suffolk 
County is located on New York's Long Island, east of New York City, and 
bordered on the west by Nassau County. Suffolk's land area totals 911 
square miles, is 86 miles long, and 15 miles wide. Shoring on both the 
Atlantic Ocean and the Long Island Sound, Suffolk's shoreline totals 
987 miles. Suffolk's prime agricultural locale can be found on its east 
end, commonly known as the ``twin forks'' of the island. The 28-mile 
northern peninsula, known as the ``North Fork'' is the County's primary 
farm country, and ends at Orient Point.
                   the need for farmland preservation
    Despite booming commercial and residential development and its 
proximity to New York City, Suffolk County and its residents have, and 
continue to maintain its rural tradition via a sound agricultural 
industry. This expanding industry is seasonally highlighted by 
Suffolk's vineyards, strawberry and pumpkin patches, local produce 
stands, nursery and greenhouse cultivation, and an established potato 
growth. As aforementioned, Suffolk's wine industry is experiencing 
considerable expansion and currently accounts for the largest premium 
wine industry of any county in the United States outside the State of 
California. It is these agricultural products that have afforded 
Suffolk's residents a profitable link to the past, while at the same 
time affording protection from developmental pressures.
    Suffolk County's Farmland Preservation Program is now 23 years old, 
and was the first Purchase of Development Rights (PDR) program in the 
United States. Farmland preservation in Suffolk County is crucial on 
many fronts. The remaining farmland in Suffolk County represents the 
last vestige of an historical way of life dating back to the mid 
1600's. Farmland preservation is critical to maintaining a rural 
character that will result in ensuring the scenic beauty of Suffolk's 
east end. Additionally, on a larger scale, it is this rural character 
that contributes to tourism on Long Island, currently a $2 billion 
industry. Economically, as an agricultural producer, Suffolk County 
continues to lead New York State in the market value of agricultural 
products sold, totaling over $133 million.
    Suffolk County's farms are facing significant, even intense, 
developmental pressure. Commercial and residential development has 
already consumed a large percentage of the vast blocks of vacant land 
and farmland in the County's four western towns. Less than 1,800 acres 
remain, and much of this is in the process of being developed. The 
remainder is prohibitively expensive, with approximate values ranging 
from at least $50,000 to $100,000 per acre. Unless farmland is 
preserved now, significantly higher prices will result in the Town of 
Brookhaven and the five eastern Towns.
                our commitment to farmland preservation
    Recognizing the necessity of immediate action in preserving our 
last remaining farmland acres, I have recently increased the amount of 
money included in my capital budget from $1.5 million per year to $5 
million per year commencing in 1998. Moreover, a Community Greenways 
Fund was recently established, allocating an additional $20 million for 
farmland purchases. Overwhelmingly passed by referendum in November of 
1998, we hope to leverage these dollars with both federal and state 
funds.
    Suffolk County has demonstrated a commitment to long term 
conservation of our prime farmlands, which are among the most fertile 
in the United States. Overall, we have appropriated in excess of $32 
million to preserve over 6,200 acres. These voluntary easements are 
used with other preservation mechanisms such as clustering and 
agricultural districting to protect Suffolk's farmlands against 
nonagricultural conversion uses. Suffolk County's current farmland 
preservation agenda also stems from the County's 1982 passage of a 
``Right to Farm'' law, establishing an official County policy to 
conserve, protect, and encourage agricultural uses.
    Suffolk County is currently in contact with the owners of 1,763 
farm acres that have offered to sell the development rights to the 
County. This list awaits necessary funding, and would require 
approximately $15 million to acquire. On average, two farms are added 
to the list each month. As evidenced by the decline in total acreage in 
Suffolk County from 123,346 acres in 1950 to 35,323 acres in 1992, 
federal funds are needed to help accelerate the PDR programs before a 
critical mass of Suffolk farmland is lost forever. Alarmingly, Suffolk 
County loses approximately 1,289 acres annually. At the County's 
previous annual spending rate of $1.5 million, it may be as soon as 15 
years before the remaining farmland left in Suffolk numbers only 10,000 
acres. As outlined in the Suffolk County Farmland Preservation Plan of 
1996, in order to meet our goal of preserving 20,000 acres, an 
expenditure of $15 million annually would be necessary. Suffolk County 
and its residents cannot afford to bear this cost alone.
    To date, disproportionate to our overall financial need, Suffolk 
County has received only a small appropriation of federal funds through 
the Federal Farmland Protection Program. Additional federal funding 
will ensure that future generations of Suffolk County residents will 
gain from, and participate in the rich rural heritage that attracted 
the County's original inhabitants. Furthermore, with federal funds, we 
will encourage and stimulate local Town involvement in farm 
conservation, namely the four eastern Towns of Suffolk County. On an 
individual basis, support of the County's preservation initiative has 
proven to be overwhelming in terms of farmer assistance and 
participation. Suffolk's farmers and non-farmers alike recognize the 
urgency of shielding one of the County's last remaining natural 
resources. With a new millennium of high tech industrialization 
approaching, Suffolk County recognizes that such aspirations will prove 
futile without appropriate federal funding.
    In conclusion, non-agricultural conversion of such lands will 
remove excellent soil from productive use, destroy historic farming, 
and diminish the scenic attractiveness traditionally enjoyed by 
Suffolk's residents. Therefore, farmland preservation in Suffolk County 
is not an option, but a necessity. It is for these reasons that I ask 
for your support in appropriating additional dollars into the Federal 
Farmland Protection Program.
    Thank you for your sincere consideration of this matter.
                                 ______
                                 
    Prepared Statement of the Southern Legislative Conference (SLC) 
  Agriculture and Rural Development Committee and of the SLC Fire Ant 
                               Task Force
    Mr. Chairman and members of the Committee: Thank you for the 
opportunity to testify before the Committee. As the Chairman of the 
Southern Legislative Conference (SLC) Agriculture and Rural Development 
Committee and of the SLC Fire Ant Task Force, I am very concerned about 
the appropriation for the fire ant research budget within the 
Agricultural Research Service (ARS) of the United States Department of 
Agriculture. The SLC Agriculture and Rural Development Committee and 
the Fire Ant Task Force strongly supports the administration's request 
for an additional $300,000 appropriation for the ARS's fire ant 
program. Furthermore, we feel that in order to continue the successes 
of this program and to develop successful pilot programs in affected 
states, an additional $1.5 million is necessary.
    Fire ants are a problem for urban, suburban, and rural communities 
alike, costing Southerners billions of dollars each year. Fire ants 
have a powerful sting which gave them their name. For the one person in 
a hundred allergic to the sting, a fire ant attack can cause extreme 
medical complications. Fire ants also are blamed for a handful of 
deaths every year. Less serious, but still worrisome, are the pain and 
discomfort the stings give the hundreds of thousands of people attacked 
each year. Fire ants have been known to invade houses, hospitals, and 
nursing homes, where they have attacked bedridden patients, and have 
colonized playgrounds and parks. The ants are attracted to low-level 
electrical current, have shorted out electrical junction boxes and air 
conditioner units, and attacked utility workers who unknowingly disturb 
their nests. As an agricultural pest, the fire ants' impact ranges from 
attacking calves and chicks, girdling young crops, blocking or 
destroying drip irrigation systems, restricting hand and mechanical 
harvesting of crops, and damaging harvesting equipment. Fire ants also 
can have a devastating effect on biodiversity and have caused 
significant problems for several endangered species.
    While fire ants can colonize new territory through mating flights, 
relocation of their colony, and by ``rafting'' during floods, their 
real ``invasion'' of the South was assisted by the actions of people, 
especially in the transport of sod, nursery stock, and agricultural 
equipment. During the housing boom following World War II, the fire ant 
began to appear in areas not contiguous with its previous range and, by 
1953, a connection between commercial plant nurseries and the spread of 
fire ants was established. By 1958, with the ants in eight southern 
states, federal quarantine regulations went into effect which has 
undoubtably helped to slow the further spread of the pest.
    During this period, and up into the early 1970's, two chemicals, 
heptachlor and mirex, were used to control the ant, but both were 
eventually banned because of their impact on non-target species, their 
persistence in the environment and the possible risk to human health. 
In 1980, new chemical compounds which would break down more quickly, 
began to appear on the market, including Ambdro, Logic, Ascend, and 
Affirm. They are neither as cheap nor as effective as previous 
treatments, but they do still provide 80 percent to 90 percent control 
with little residual effect. New chemical applications are being 
developed, but it is certain that future fire ant management will add 
cultural and biological controls and integrated pest management to 
chemical controls.
    Chemical controls are generally broad in scope and eliminate 
beneficial and harmful ants indiscriminately, with fire ant 
reinfestations almost certain to occur, often in even greater numbers. 
The expense of pesticide treatment and the environmental impacts of 
excessive or improper application of chemical treatments can extract a 
heavy toll as well. Biological controls, while not as immediately 
effective in controlling fire ants, can have excellent long-term 
results with minimal recurrent costs and can re-establish balance to 
the ecosystem. An integrated approach which uses both chemical and 
biological methods seems to offer out best hope for controlling the 
worrisome ant.
    The SLC Agriculture and Rural Development Committee, for which I 
serve as Chairman, has had a long-standing interest in activities to 
control fire ants. In 1997, the Committee formed a special Fire Ant 
Task Force to serve as a driving force behind fire ant research, 
education, pilot testing of control activities, information-sharing, 
and area-wide management. In January 1998, the SLC Fire Ant Task Force 
met in Atlanta with representatives of ARS and members of the research 
and extension communities to discuss strategies for developing a 
cooperative effort to control the imported fire ant.
    During this meeting, the SLC Fire Ant Task Force formally requested 
assistance from the USDA on creating a strategic plan for developing 
and field-testing new technologies aimed at controlling the fire ant. 
This strategy, which was subsequently developed in cooperation with 
state level scientists and extensionists identified by Task Force 
members, provides the framework for cooperation between states and the 
USDA/ARS. The goal of the strategy is the management of fire ants to 
levels below economic thresholds on agricultural lands and to eliminate 
the fire ant as a nuisance or health threat in urban environments.
    Recently, ARS has had some success in developing new strategies and 
technologies for controlling fire ants. Much of their work involves 
biological control agents which selectively attack fire ants and 
precision targeting of fire ant baits to suppress fire ant populations, 
reducing the total amount of pesticide needed for control.
    Work conducted by ARS over the past six years in America, Brazil, 
and Argentina has identified three biological control agents as most 
promising: the Thelohania microsporidium, a bacteria; a parasitic ant; 
and a phorid fly. These biological controls should give native 
competitor species an edge over the more competitive fire ant. This 
will hopefully return balance to ecosystems thrown out of alignment by 
this aggressive ant and remove the serious threat of harm by the fire 
ant.
    In order to test the effectiveness of the new technologies, and to 
speed the process of transferring these technologies to the states, the 
SLC and the USDA have entered into a partnership to provide states 
access to ARS technologies, allowing states to conduct field tests on 
these new advances in their region at a fraction of the cost of 
developing them independent of the ARS.
    The states of Oklahoma and South Carolina, and soon the state of 
Texas, all have committed substantial resources to further the USDA's 
research, including direct cost-share money to support USDA research. 
Testing activities are underway as well in Alabama, Arkansas, Florida, 
Georgia, Louisiana, North Carolina and Tennessee. In all, there are 14 
test sites in 10 states investigating the viability of biocontrol 
agents through a partnership with the USDA and the states. These test 
sites, intended for research, are very local in their scope. More 
ambitious, and critical, pilot projects in key affected states are the 
next logical steps, and this is the direction the states and the USDA 
are heading.
    The new technologies do not offer a ``magic bullet'' for the 
elimination of fire ants. Realistically, fire ant eradication may be 
beyond the capacity of any treatment. But managing fire ants to levels 
below economic and public safety threats is perceived as possible. The 
new SLC/USDA partnership is a step toward that goal, and a step aimed 
at providing states access to the most current research and information 
with the flexibility to direct their own controlled field tests.
    The commitment of state resources to this effort is a key element 
of its success, but there is a need for continued and increased support 
of this effort from the USDA. As the new technologies and control 
agents enter into broader tests and proposed pilot projects, the USDA 
will need additional funds to support these activities. It is for this 
reason that the SLC Agriculture and Rural Development Committee and the 
Fire Ant Task Force strongly support the administration's additional 
$300,000 appropriation for the ARS's fire ant program. We feel that in 
order to continue the successes of this program and to develop 
successful pilot programs in affected states, an additional $1.5 
million is necessary.
    To put this in perspective, the state of California is considering 
spending $100 million over the next five years to combat fire ants 
which infest only about 50 square miles of the state. With more than 
310 million acres in the southern U.S. and Puerto Rico infested with 
fire ants, the USDA is strained to its capacity to provide the 
necessary resources to states to continue research efforts. Any 
expansion of the program, including new pilot projects, would require 
input at the federal level to complement state contributions and 
commitments.
    In closing, I want to underscore two points. The first is the 
tremendous impact the fire ant has had on the South, and the great 
potential for harm it has should it spread throughout the West. The 
second is the commitment of the states to a process already underway to 
find control solutions to this invasion. I hope you will agree with me 
that this is an appropriate and important area for increased federal 
activity. Thank. you.
                                 ______
                                 
           Prepared Statement of Texas A&M University System
    Mr. Chairman and members of the Committee, I am Ed Hiler, Vice 
Chancellor for Agriculture and Life Sciences in the Texas A&M 
University System. I appreciate the opportunity to appear before you 
today, to describe a few exciting research projects we have underway, 
and to ask for your support for continued federal funding. New 
technology is the life blood of American agriculture. With the 1996 
Farm Bill and resulting phase down in federal farm programs, it is 
imperative that research continues providing a technological 
underpinning for agriculture. Today, I will describe several examples 
of how we can provide this underpinning.
    Designing fruits, vegetables and other food plants for prevention 
of life-threatening diseases.--Diet-related diseases--certain kinds of 
cancer, heart disease, stroke, atherosclerosis, and diabetes mellitus--
are leading causes of two-thirds of the 2 million deaths that occur in 
the United States each year. Antioxidants in fruits and vegetables, 
including anthocyanins, beta-carotene, lycopene, quercetin, and 
vitamins C and E, can help prevent certain types of cancer, coronary 
heart disease, stroke, and atherosclerosis. However, additional study 
is needed to determine the most effective levels of these compounds; 
validate their mechanisms of action; and investigate their 
availability, absorption, metabolism, and interactions with other 
chemicals. Scientists at the Vegetable Improvement Center within the 
Texas Agricultural Experiment Station, Texas A&M University-Kingsville 
Citrus Center, University of Texas Southwest Medical Center in Dallas, 
University of Texas Health Science Center-San Antonio, Texas A&M 
University System Health Science Center, Baylor College of Dentistry, 
and South Carolina Cancer Center will cooperate in the effort. We are 
requesting increased funding for this important continuing project at 
$2,000,000 for fiscal year 2000.
    Increasing food safety through biotechnology.--As many as 9,000 
deaths and up to 81 million cases of foodborne illness occur in the 
U.S. every year. Approximately 5 percent of all cases can be linked to 
fresh produce and another 16 percent to contaminated meat products. New 
and rapidly improving biochemical techniques popularly known as 
``biotechnology'' hold great promise for helping the food industry 
trace foodborne pathogens to their source using genetic 
``fingerprinting''. Rapid tracing would prevent further consumption of 
contaminated food during an outbreak by quickly alerting health 
agencies and the public. In addition, more effective strategies can be 
developed to reduce sources of contamination and minimize emergence of 
disease-causing organisms. Scientists from Iowa State University, the 
Institute of Food Science and Engineering at Texas A&M University, and 
The Center for Research on Animal Production Issues at Texas Tech 
University will cooperate on the project, which we estimate will 
ultimately reduce medical cases associated with food borne pathogens by 
210,000 and the numbers of deaths by 380 per year. We are requesting 
funding for this project at $1,250,000 for fiscal year 2000.
    Southern Plains Cotton Research and Education Consortium.--Cotton 
producers and processors of the Southern Plains face unprecedented 
challenges from declining commodity prices and profit margins. Over the 
last several years, elimination of government acreage control programs 
combined with much improved boll weevil control in the southeastern 
U.S. have increased cotton production and depressed prices. During this 
same period, the boll weevil has become established on more than 4 
million acres of cotton in the Southern Plains of Texas, threatening to 
cause $500 million in annual economic losses if successful management 
strategies are not implemented. To help Southern Plains producers, 
Texas Tech University, the Texas A&M University System Agriculture 
Program, and the USDA-ARS have formed a consortium to develop 
integrated research and education programs for the world's largest 
cotton patch. The principal elements of the integrated program will be 
genetic enhancement of cotton yields, quality, and stress tolerance, as 
well as improved management of the boll weevil. We are requesting 
funding of $5,500,000 for this project for fiscal year 2000.
    Efficient irrigation for water conservation in the Rio Grande 
Basin.--The region along the U.S.-Mexico border north of the Rio Grande 
River is a land of contrasts, including severe poverty, rapid economic 
growth, and intensive irrigated agriculture. Recent drought conditions 
highlight the importance of ample water resources for the region's 
economy and environment. More efficient agricultural and urban 
irrigation systems can conserve large amounts of water. This initiative 
will focus resources of the Agricultural Experiment Stations and 
Extension Services of Texas and New Mexico and the Texas Engineering 
Extension Service on reducing amounts of irrigation water needed to 
economically produce field and horticultural crops and to maintain 
attractive urban landscapes. Training will be provided in the areas of 
water supply, irrigation, and waste water system assessment, planning, 
design, financing, installation, use, and maintenance. Applied research 
will be conducted on irrigation system efficiency, biological and 
chemical hazards of waste water, reuse of agricultural and municipal 
waste waters, and integration of municipal and agricultural water 
supplies. Conservation will be achieved through improved irrigation 
supply networks, urban and agricultural irrigation systems, salinity 
and drainage control, and reuse of municipal water. We are requesting 
funding of $3,250,000 for this project for fiscal year 2000.
    Environmental services of rice lands in Arkansas, Louisiana, and 
Texas.--Privately-held rice lands provide a variety of ecological 
services, but they can also have adverse environmental impacts. Public 
benefits include wildlife habitat, water filtration through wetlands, 
and flood protection. Adverse impacts can include degradation of soil 
organic matter, salinization, sedimentation, agricultural chemical 
losses, and groundwater depletion. Elimination of Federal agricultural 
commodity price support programs is reducing acreage in some parts of 
the Rice Belt and increasing it in others--with the unintended result 
of decreasing ecological services in some regions and increasing 
adverse environmental impacts in others. Scientists from the Texas A&M 
University System, the University of Arkansas, Louisiana State 
University, and USDA-ARS will examine environmental benefits and costs 
of alternative rice production technologies and how we might strengthen 
communities and increase the environmental and economic benefits of 
rice culture. We are requesting funding of $1,000,000 for this project 
for fiscal year 2000.
    Revenue insurance as a risk management tool.--Increased volatility 
of commodity prices and dissatisfaction with crop insurance as an 
income safety net policy have heightened interest in revenue insurance. 
Decision makers need a comprehensive farm level, regional, and 
aggregate sector analysis of revenue insurance as a risk management 
tool, including the place of current private sector insurance 
instruments. The Agricultural and Food Policy Center at Texas A&M 
University is currently involved in developing a preliminary 
exploration of the feasibility of revenue insurance as a safety net for 
farmers. In addition, it has led the development of a financial and 
risk management assistance decision aid to quantify payoffs to 
individual producers utilizing alternative risk management packages. 
This initiative would also examine the conditions under which revenue 
insurance could serve as a safety net for farmers and, therefore, as a 
substitute for conventional farm programs. We are requesting funding of 
$750,000 for this project for fiscal year 2000.
    Animal fiber research.--The phase out of wool and mohair incentive 
payments has left the United States sheep and Angora goat industry in a 
very difficult position. This is especially important for the large 
areas of semiarid U.S. lands that have few options for alternate 
agricultural enterprises. Scientists in Texas, Montana, and Wyoming 
have developed image analysis applications for measuring most of the 
important characteristics of wool, mohair, and cashmere. Results from 
this work have contributed significantly to acceptance and marketing of 
U.S. wool. More research is needed before industry fully adopts these 
innovative practices for product selection and marketing, helping 
producers become more competitive in new and existing markets. We are 
requesting continued support of this project at $300,000 per year.
    Farm level impacts of agricultural policy.--The Agricultural and 
Food Policy Center conducts research directly supporting Congressional 
Committees that set agricultural policy. Its research emphasizes 
regional and farm-level effects of alternative agricultural policies on 
crop and livestock producers. The Center provides estimates of how 
regional production, commodity prices, farm incomes, and consumer food 
costs are economically affected by U.S. policy. It assesses how U.S. 
economic relationships impact individual representative farms, and the 
viability of the U.S. food and fiber industry. This activity is 
critical with a reduced government role embodied in the 1996 Farm Bill; 
moreover, these analyses are not available to Congress from USDA or 
other research centers. This program is conducted in collaboration with 
the Food and Agriculture Policy Research Institute (University of 
Missouri-Columbia) and the Farm Sector Financial Analysis Branch of 
CSREES/ERS. Since this effort was initiated in fiscal year 1990, it has 
helped agriculture committees assess more than 100 policy options. For 
fiscal year 2000, we request continued funding of this project at the 
level of $500,000.
    Livestock and dairy policy analysis.--The Livestock and Dairy 
Policy Analysis project is a joint effort of Texas A&M University and 
Cornell University. It supports a dairy policy education program that 
involves economists at the University of Wisconsin, Ohio State 
University, Pennsylvania State University, and Clemson University. In 
the past, faculty at these universities have helped conduct a ``dairy 
policy school'' in the House of Representatives. Moreover, our faculty 
have been consistently available to the Livestock Subcommittee for 
analyses of dairy policy options. Building on the success of this 
initiative, we propose to expand the activities to create a national 
dairy economics education center at Cornell University with Texas A&M 
as a cooperating institution. For fiscal year 2000, we request 
continued funding of this project at $625,000.
    Center for North American studies.--The Center for North American 
Studies, now in its sixth year of operation, promotes cooperative 
research, policy analysis, and training on critical agricultural issues 
of common interest to the United States, Mexico, and Canada. The 
Center's primary focus has been impacts of NAFTA, especially impacts on 
expanded trade and associated public policy concerns. Though the Center 
is located at Texas A&M University, it has strong cooperative linkages 
with Louisiana State University, Texas A&M University at Kingsville, 
and Texas A&M International University at Laredo. Since 1994, Center 
personnel have conducted nearly 30 workshops or conferences annually, 
reaching an estimated 3000 people per year. In July 1998, the Center 
initiated, in cooperation with USDA-FAS, a five-state interactive video 
conference to inform more than 100 agribusiness representatives about 
market opportunities, trade regulations, and economic conditions in 
Mexico, Central America, and Asia. We are requesting continued funding 
for this project at $300,000 for fiscal year 2000.
    New products from rangelands at Texas A&M University-Kingsville.--
This initiative will continue efforts to gain commercial products from 
native plants such as cacti and mesquite. Congress has funded this 
program at Texas A&M University-Kingsville for several years, and 
excellent progress has been made. A mesquite lumber grading system and 
industry is developing under project funding. The grading system has 
helped producers market mesquite wood for furniture, flooring, and 
other uses. Similarly, progress has been good on marketing cactus 
products, and a major grocery chain now offers fresh cacti fruit to 
consumers. In 1998, a tall-straight mesquite contest was conducted to 
identify trees that will serve as the basis for a genetic improvement 
program in mesquite . In 1999 the program will plant nearly 1,000 
seedlings to evaluate for lumber quality and serve as a seed source for 
future selection. We are requesting continued support at $120,000 per 
year for Texas A&M University-Kingsville in fiscal year 2000.
    International goat research at Prairie View A&M University.--The 
International Dairy Goat Research Center was established in 1983 and is 
now an important program of the Cooperative Agricultural Research 
Center at Prairie View A&M University. The primary objective of the 
Center is to generate and distribute technical information to owners of 
dairy goats concerning proper management of their animals. This 
research program conducts research on overall dairy and meat goat 
management and care in the areas of reproduction, reproductive 
efficiency, health, disease and toxicology. The Center also conducts 
comprehensive outreach activities, including an annual field day, short 
courses, and workshops. Special emphasis is given to assisting small 
landowners to diversify their production systems. We are requesting 
expansion of this project at Prairie View A&M University to $750,000 in 
fiscal year 2000.
    Shrimp aquaculture research.--The U.S. Marine Shrimp Farming 
Program develops technology and provides service to the marine shrimp 
industry. The market for farm-raised salt water shrimp is expanding 
rapidly, especially as the wild catch in the Gulf of Mexico declines. 
With the help of this Program, the Texas marine shrimp farming industry 
has rebounded since a serious outbreak of Taura Syndrome Virus disease 
in 1995, reaching unprecedented $30 million in production in 1998, more 
than three quarters of all U.S. farmed shrimp. This initiative will 
extend the U.S. competitive technological advantage over foreign 
countries by supporting researchers working to improve animal quality, 
herd health, water quality, seedstock supply, pond management, 
production risks and profitability. The USDA/CSREES for the Oceanic 
Institute currently funds this program in Hawaii and the Gulf Coast 
Laboratory Consortium. We request funding at $5,000,000 for fiscal year 
2000 through the USDA/CSREES Federal Administration Program.
    Center for animal research and production issues.--This 
collaborative partnership led by Texas Tech University and including 
the Texas Tech University Health Sciences Center, the Texas A&M 
University System, and the USDA-ARS, will conduct research to solve 
problems related to animal production, including animal health and 
well-being, safety of animal products (pre-and post-harvest), and 
development of environmentally and economically sustainable production 
systems. We are requesting $2,100,000 for Texas Tech University to 
support this program in fiscal year 2000.
    Efficient peanut production in west Texas.--Peanut acreage has 
increased dramatically in West Texas, which now accounts for 72 percent 
of the state's production. This initiative joins Texas Tech University, 
the Texas A&M University System, and regional peanut producers in a 
comprehensive research and education program to address peanut 
production and management strategies for West Texas. We are requesting 
$2,000,000 for Texas Tech University to support this program in fiscal 
year 2000.
    Precision agricultural management systems for the Southwest.--This 
initiative is a partnership among Texas Tech University, the Texas A&M 
University System, New Mexico State University, West Texas A&M 
University, and USDA-ARS. Its objective is to develop and enhance the 
efficient use of resources in crop production and the management of 
rangeland, wildlife and the forests of the Southwestern US. We are 
requesting $4,200,000 for Texas Tech University to support of this 
program in fiscal year 2000.
    Food safety and water quality at west Texas A&M University.--The 
West Texas A&M University Feedlot Research Group proposes to 
collaborate with the Texas Agricultural Experiment Station, Texas 
Agricultural Extension Service, and USDA-ARS to characterize the role 
of water as a vehicle for food safety-related pathogens in feedlot 
cattle. The cooperating agencies will then evaluate the effectiveness 
of intervention strategies to reduce contamination of carcasses, cattle 
and water. We are requesting $1,000,000 for West Texas A&M University 
to support this program in fiscal year 2000.
    Plant Stress Research Program.--This initiative provides support 
for the integration of Texas Tech University, USDA-ARS, and the Texas 
Agricultural Experiment Station into a world class plant stress 
research effort. The main research efforts will be to increase water 
use efficiency, develop crops that are genetically superior in stress 
tolerance, utilize sophisticated modeling systems to maximize 
production, and overcome adverse water quality. We are requesting 
$1,000,000 in fiscal year 2000 for USDA-ARS to support this program.
                                 ______
                                 
            Prepared Statement of the U.S. Apple Association
    The U.S. Apple Association (USApple) appreciates the opportunity to 
provide comments on U.S. Department of Agriculture (USDA) fiscal year 
2000 appropriations.
    Our testimony will focus on the following three areas: the Foreign 
Agricultural Service Market Access Program; Food Quality Protection Act 
implementation; and Agricultural Research Service funding.
    The U.S. Apple Association (USApple) is the national trade 
association representing all segments of the apple industry. Members 
include more than 450 individual firms involved in the apple business, 
as well as 30 state apple associations representing the 9,000 apple 
growers throughout the country. The U.S. Apple Association's mission is 
to provide the means for all segments of the U.S. apple industry to 
join in appropriate collective efforts to profitably produce and market 
apples and apple products.
        foreign agricultural service market access program (map)
U.S. Apple strongly supports increasing the annual appropriation for 
        MAP from $90 million to $200 million
    All segments of the U.S. apple industry benefit directly from the 
use of export promotion funds, which increase export demand. In fiscal 
year 1998, the apple industry received $4 million in MAP export-
development funds. These funds are matched by grower funds, and are 
used to promote apples in more than 20 countries throughout the world. 
Since 1987, when the apple industry first utilized MAP funds, apple 
exports have increased by 53 percent.
    The U.S. apple industry faces keen competition around the globe 
from competitors who receive significant government funds for generic 
promotions. Foreign governments spend approximately $500 million on 
export promotion and market development. With apple production 
increasing around the world, competition is expected to further 
intensify. MAP is of paramount importance to the apple industry as 
exporters endeavor to revive export demand in countries hard hit by 
economic shocks and currency devaluations over the past two years.
           food quality protection act (fqpa) appropriations
U.S. Apple strongly supports full funding for the following programs 
        intended to facilitate fair FQPA implementation and to offset 
        its anticipated negative impact on apple growers
    U.S. Apple supports the Administration's USDA budget requests of:
  --$13.1 million for the Pesticide Data Program, managed by the 
        Agricultural Marketing Service;
  --$2 million for the food consumption survey undertaken by the 
        Agricultural Research Service;
  --$.3 million for the National Agricultural Statistics Service 
        pesticide-usage surveys;
  --$2.7 million the National Agricultural Pesticide Impact Assessment 
        Program in support of the Office of Pest Management Policy;
  --$12.3 million for the Cooperative State Research, Extension and 
        Education Service Integrated Pest Management Research Grant 
        Program; and
  --$18 million for research and transition programs for crops 
        negatively impacted by FQPA.
   agricultural research service (ars)--temperate fruit fly research 
                      position--yakima, washington
    U.S. Apple requests that $300,000 be appropriated to fill a 
critical position at the USD-ARS laboratory in Yakima, Washington to 
conduct research of temperate fruit flies, a major pest of apples.
    FQPA implementation is expected to significantly reduce the number 
of pesticides currently being used by growers to control pests such as 
cherry fruit fly and apple maggot. Left unchecked, these temperate 
fruit flies can be devastating. Research is critically needed to 
develop alternative pest controls should presently-available crop 
protection tools be phased out under FQPA implementation.
    Thank you for this opportunity to present this testimony in support 
of the apple industry's top USDA appropriations.
                                 ______
                                 
     Prepared Statement of the United States Telephone Association
                           summary of request
    Project involved.--Telecommunications Loan Programs Administered by 
the Rural Utilities Service of the U.S. Department of Agriculture.
    Actions proposed.--Supporting RUS loan levels and the associated 
funding subsidy for the hardship, cost of money, and loan and subsidy 
guarantee programs in fiscal year 2000 in the same amount as loan 
levels specified in the fiscal year 1999 Agriculture Appropriations Act 
(Public Law 105-277). Also supporting Rural Telephone Bank loans and 
associated subsidy in the amount requested in the President's budget. 
Also supporting an extension of the language removing the 7 percent 
interest rate cap on cost of money loans for fiscal year 1999. Also 
supporting continuation of the restriction on the retirement of class A 
Rural Telephone Bank stock in fiscal year 2000 at the level contained 
in Public Law 105-277) and an extension of the prohibition against the 
transfer of Rural Telephone Bank funds to the general fund. Supporting 
funding for $200 million in loan authority and $20 million in grants 
designated for distance learning and telemedicine purposes. Opposing 
the President's budget proposal to transfer funds from the unobligated 
balances of the liquidating account of the Rural Telephone Bank for the 
Bank's administrative expenses and loan subsidy costs.
    The United States Telephone Association (USTA) represents over 1000 
local telephone companies that provide over 95 percent of the access 
lines in the United States. USTA members range from large public held 
corporations to small family owned companies as well as cooperatives 
owned by their customers. We submit this testimony in the interests of 
the members of USTA and their subscribers.
    USTA members firmly believe that the targeted assistance offered by 
a strong telecommunications loan program remains essential in order to 
maintain a healthy and growing rural telephone industry that 
contributes to the provision of universal telephone service. We 
appreciate the strong support this committee has provided for the 
telephone program since the program's inception in 1949 and look 
forward to a vigorous program for the future.
                          a changing industry
    As Congress recognized through passage of the Telecommunications 
Act of 1996, the telephone industry is in the midst of one of the most 
significant changes any industry has ever undergone. Both the 
technological underpinnings and the regulatory atmosphere are 
dramatically different and changing very quickly. Without system 
upgrades funded by the reliable source of lower cost debt capital 
provided by the RUS telecommunications program, rural areas will be 
left out of the emerging information revolution.
    The need has never been greater for the technology employed by RUS 
borrower rural telephone companies to continue to be modernized. The 
demand for new switches to serve rural areas could be unprecedented in 
the next year. What is driving this demand? First, there are several 
Federal Communications Commission mandates that incumbent local 
companies will have to meet. Upgrades related to new rules regarding 
pay phone compensation, implementation of four digit Carrier 
Identification Codes (CICs), and number portability are all new 
Commission requirements driven by the 1996 Telecommunications Act. 
Second, there are still some companies that are not equipped to offer 
equal access to competing long distance carriers. Third, the 
Communications Assistance for Law Enforcement Act (CALEA) imposes new 
requirements on all carriers to upgrade their capabilities to assist 
the Federal Bureau of Investigation and other law enforcement agencies. 
Fourth, telephone company switches, which are really just sophisticated 
computers, are impacted by the ``year 2000'' problem.
    In addition to upgrading switching capability, it is important that 
rural areas be included in the nationwide drive for greater bandwidth 
capacity. In order to provide higher speed data services, such as ISDN 
(Integrated Services Digital Network) or even faster connections to the 
Internet, outside plant must be modernized in addition to new 
electronics being placed in switching offices. Rural areas with 
relatively long loops are particularly difficult to serve with these 
higher speed connections and require additional investment to allow 
modern services to be provided.
    Provision of greater bandwidth and switching capabilities are 
crucial infrastructure elements which will allow rural businesses, 
schools and health care facilities to take advantage of the other 
programs available to them as end users. The money spent on having the 
most modern and sophisticated equipment available at the premises of 
the business, school or clinic is wasted if the local telephone company 
cannot afford to quickly transport and switch the large amounts of data 
that these entities generate. RUS funding enhances the synergies among 
and RUS programs and other federal telecommunications targeted at 
improving rural education and health care through telecommunications.
    The RUS program provides needed incentives to help offset 
regulatory uncertainties related to universal service support and 
interconnection rules with a reliable source of fairly priced long term 
capital. After all, RUS is a voluntary program designed to create 
incentives for local telephone companies to build the plant essential 
to economic growth. RUS endures because it is a brilliantly conceived 
public private partnership in which the borrowers are the conduits for 
benefits from the federal government to flow to rural telephone 
customers, the true beneficiaries of the RUS program. The government's 
contribution is leveraged by the equity, technical expertise and 
dedication of local telephone companies.
          impact of credit reform on the rural telephone bank
    Contrary to the intent of Congress, the interpretation of credit 
reform by the Office of Management and Budget (OMB) has significantly 
affected the operation of the Rural Telephone Bank (RTB). One of the 
most damaging impacts of OMB's interpretation of the credit reform law 
is to essentially cleave the RTB into two banks--a liquidating account 
bank which is responsible for pre-credit reform loans, and a financing 
account bank which is responsible for post credit reform loans. Until 
the Administration's current budget proposal, OMB has clung to the 
proposition that funds from the two banks could not be intermingled. 
USTA has protested this arrangement since it began, since it prevents 
the relending of borrower repayments to fund new loans in direct 
contravention of Sec. 409 of the Bank's enabling act.. This, in turn, 
forces the RTB to borrow unnecessarily from the Treasury to fund new 
loans. It also permits funds to build up in the liquidating account 
that were generated by GAO documented interest rate overcharges, 
instead of those funds being returned through relending to the same 
universe of borrowers that initially generated them.
    In this new budget proposal, the Administration proposes to take 
funds from the liquidating account and fund the loan subsidy for new 
loans as well as the RUS administrative expenses allocated to the RTB 
beginning in 2000. This is in direct conflict with an existing 
provision of law, Sec. 403(b) of the Rural Telephone Bank Act (Public 
Law 92-12). That provision states ``. . . in order to perform its 
responsibilities under this title, the telephone bank may partially or 
jointly utilize the facilities and the services of employees of the 
Rural Electrification Administration or of any other agency of the 
Department of Agriculture, without cost to the telephone bank.'' 
(Emphasis added)
    Instead of using the repayments into the liquidating account to 
fund the expenses of the RTB (contrary to the Rural Electrification 
Act) or to fund the loan subsidy, neither of which would result in any 
budget savings, those repayments should be used to fund new RTB loans, 
consistent with Sec. 489 of the Rural Electrification Act.
   rus telephone program procedures should continue to be streamlined
    By revising its Annual Statistical Report as well as making other 
changes to reduce red tape and focus on results and service delivery, 
Administrator Beyer, Deputy Administrator McLean and Assistant 
Administrator Purcell have begun to take significant actions to 
streamline RUS telecommunications program procedures. These actions 
encourage the use of this voluntary program and promote the provision 
of modern telecommunications service to rural Americans. USTA is fully 
in support of less regulation and improved service delivery, within the 
context of the government's interest in security for these rural 
telecommunications infrastructure improvement loans. We applaud the 
efforts of RUS to this end and strongly support and encourage 
continuation of this long overdue initiative.
                            recommendations
    Continuation of the loan levels and necessary associated subsidy 
amounts for the RUS telephone loan programs that were recommended by 
this committee and signed into law for fiscal year 1999 would maintain 
our members' ability to adequately serve the nation's 
telecommunications needs and to maintain universal service.
    For a number of years, through the appropriations process, Congress 
has eliminated the seven percent ``cap'' placed on the insured cost-of-
money loan program. The elimination of the cap should continue. If long 
term Treasury interest rates exceeded the 7 percent ceiling contained 
in the authorizing act, adequate subsidy would not be available to 
support the program at the authorized level. This would be extremely 
disruptive and hinder the program from accomplishing its statutory 
goals. Accordingly USTA supports continuation of the elimination of the 
seven percent cap on cost-of-money insured loans in fiscal year 2000.
    The restriction on the retirement of the amount of class A stock by 
the Rural Telephone Bank, adopted in fiscal 1997, should be continued. 
The Bank is currently retiring Class A stock in an orderly, measured 
manner as current law requires. This should continue. The Committee 
should also continue to protect the legitimate ownership interests of 
the Class B and C stockholders in the Bank's assets by continuing to 
prohibit a ``sweep'' of those funds into the general fund.
Recommended Loan Levels
    USTA recommends telephone loan program loan levels for fiscal year 
2000 as follows:

                        [In millions of dollars]

RUS Insured Hardship Loans (5 percent)............................   -75
RUS Insured Cost-of-Money Loans...................................  -300
Rural Telephone Bank (RTB) Loans..................................  -175
Loan Guarantees...................................................  -120
                                                                  ______
    Total.........................................................   670

    The President's budget proposes a reduction of in the hardship 
program designed for the neediest borrowers. There is strong demand for 
hardship loans. Rural Americans cannot wait any longer to be full 
participants in the Information Age. A minimum amount of subsidy 
authority would restore the hardship loan level to its fiscal year 1999 
level. We cannot imagine a more deserving use of scarce government 
resources for the benefit of rural Americans.
Distance Learning and Telemedicine
    USTA strongly supports the loan and grant proposal and recommends 
its funding for fiscal year 2000 at the levels proposed in the 
Administration's budget submission, that is, $20 million for the grant 
program and $200 million for the loan program. This program is a 
perfect complement to the traditional RUS telephone loan programs. For 
distance learning and telemedicine to become a reality, schools and 
hospitals need training and equipment. Similarly, local telephone 
companies need modern infrastructure to connect these facilities to the 
telecommunications network.
                               conclusion
    Our members take pleasure and pride in reminding the Subcommittee 
that the RUS telephone program continues its perfect record of no 
defaults in almost a half century of existence. RUS telephone borrowers 
take deadly seriously their obligations to their government, their 
nation and their subscribers. They will continue to invest in our rural 
communities, use government loan funds carefully and judiciously and do 
their best to assure the continued affordability of telecommunications 
services in rural America. Our members have confidence that the 
Subcommittee will continue to recognize the importance of assuring a 
strong and effective RUS Telephone Program through authorization of 
adequate loan levels.
                                 ______
                                 
            Prepared Statement of the University of Illinois
    Mr. Chairman and distinguished members of the Agriculture, Rural 
Development, and Related Agencies Subcommittee.--We are pleased to 
provide this updated testimony on behalf of the federally-funded 
project entitled ``Studies to Reduce the Aflatoxin Problem in Corn'' 
being carried out in the University of Illinois Crop Sciences 
Department by Professors J. M. Widholm and D. G. White, in cooperation 
with scientists in other institutions and agencies. Professors White 
and Widholm provided the technical information in this report. We wish 
to thank you, Mr. Cochran and others on the Committee, for 
appropriating $1,119,000 to date for this important research. During 
the past year, some important milestones were achieved, bringing the 
project closer to achieving its objective. We request an fiscal year 
2000 allocation of $180,000 so that we can move these promising results 
further toward fruition for U. S. corn producers and consumers.
                         the aflatoxin problem
    Because of its toxicity and carcinogenicity (causes cancer), 
aflatoxin in corn grain is a very serious problem. When the causal 
fungus, Aspergillus paves, is present on the grain, the toxin is often 
present also. Aflatoxin problems occur primarily in years and areas of 
moisture stress, which means their occurrence is relatively 
unpredictable. According to our studies of sixty-five widely grown 
commercial corn hybrids, including normal corn, white corn, and food-
grade corn, there is little or no resistance to A. pavus in commonly 
grown hybrids. The inbred lines of corn widely used to produce these 
hybrids lack resistance genes.
    The toxin can form in the maturing grain before harvest and in 
stored grain if the moisture levels are too high. Due to the danger 
posed by aflatoxin, levels of the toxic compound are closely Stored in 
corn grain. If levels of aflatoxin are too high in a given sample, the 
grain represented by the sample cannot be sold in interstate commerce. 
There is a significant monitoring cost, but it is small relative to 
other costs incurred by aflatoxin.
    It is estimated that in any given year 5 to 30 percent of the 
nation's corn crop experiences severe moisture stress. Direct yield and 
quality losses caused by aflatoxin are at least $500 million annually. 
That loss accrues to producers. In addition, there are harmful health, 
social, and economic effects of aflatoxin when it is present in corn-
based food products. Aflatoxin is one of the most carcinogenic of 
naturally occurring compounds. It is very detrimental to the health of 
humans or animals that ingest it. For these reasons, it is important to 
eliminate aflatoxin from corn grain. That is the mission of this 
project.
             the strategy for removing aflatoxin from corn
    The strategy of the project is to: through field tests, identify 
resistant germplasm in existing collections, using tissue culture 
techniques, evaluate and select corn cultures that inhibit A. paves 
growth and/or aflatoxin production, regenerate promising plants for 
greenhouse and field evaluation, using recombinant DNA techniques, 
introduce into corn antifungal genes encoding enzymes such as chitinase 
and B-glucanase, which may impart resistance to A flavus, and determine 
the effect of fungicides on A. paves growth and aflatoxin production.
                 progress report and look to the future
Previous and current conventional breeding and selection approaches
    Since 1991 we screened thousands of corn inbred lines, some of 
which already existed in various collections and some of which we 
derived from existing material. We identified 11 lines with high levels 
of resistance to Aspergillus ear rot and to the production of 
aflatoxin. We concentrated on sources of resistance that can be used to 
improve inbred lines B73 and Mol7, from which most important 
commercially used inbred lines are derived.
    In inheritance studies, we found that resistance genes have both 
additive and dominant affects. It is desirable for resistance genes to 
be dominant, so that when resistant and susceptible lines are crossed, 
the resulting hybrids will be as resistant as the resistant parent. 
Some of the resistance genes discovered are strongly dominant. Much of 
the effort was concentrated on inbred line Tex 6, developed at the 
University of Illinois by selecting from a southern white corn 
population that has high levels of resistance to southern corn leaf 
blight.
    Tex 6 confers extremely high levels of aflatoxin resistance when 
crossed with most of the inbreds that are important in the cornbelt. 
Inheritance studies indicate that the resistance in Tex 6 is controlled 
by just a few genes, which is very desirable. The fewer the genes 
controlling a trait, the easier it is to transfer that trait to 
otherwise desirable lines and the faster the trait can be introduced 
into widely used material using the common backcrossing approach. At 
best, it takes several years of backcrossing to restore the high yield 
potential of important inbreds, while at the same time retaining 
aflatoxin resistance introduced in the original cross with Tex 6.
    A major milestone was reached when, using Tex 6 and other 
experimental lines and the backcrossing approach, we were able to 
transfer effective aflatoxin resistance into commercially used inbreds 
related to both B73 and Mol7. In 1995 and 1996 yield trials, hybrids 
with some of these new aflatoxin resistance inbreds as one parent 
yielded as well as popular commercial hybrids. This is extremely 
important because unless resistant varieties yield as well or better 
than normal varieties when aflatoxin is not a problem, they won't be 
acceptable to producers. This breakthrough paves the way for private 
firms to introduce resistance to A. pavus and aflatoxin into their best 
lines.
Important finding in fiscal year 1998
    The most important development in corn production in recent years 
was the introduction of practical high oil corn hybrids by Dupont and 
Pfister Hybrids, using materials developed at the University of 
Illinois. Unfortunately, high oil hybrids, which are produced by the 
so-called topcross method, are more susceptible to Aspergillus ear rot 
and aflatoxin production than are normal hybrids of the same pedigree 
with a normal pollinator. Fortunately, high oil top crosses that 
involve some of the sources of resistance developed in this aflatoxin 
project are equal in resistance to normal resistant hybrids. Thus, this 
project is providing the mechanism to assure that the enormous 
potential of high oil corn is not reduced by aflatoxin.
Past, current, and future biotechnology research on aflatoxin
    Three years ago, we used Restriction Fragment Length Polymorphism 
(RFLP) markers, a powerful biotechnology technique, to identify those 
chromosome regions associated with specific genes for aflatoxin 
resistance. We found that some genes confer resistance to the fungal 
disease organism (A. paves) that causes ear rot. Some do not confer 
resistance to the fungal organism but do inhibit its production of 
aflatoxin. Some genes do both.
    A cooperator, Professor Gary Payne of North Carolina State 
University, identified a specific protein from seed of inbred Tex 6 
that inhibits aflatoxin production in culture but has very little 
effect on growth of the fungus. He identified another protein that 
inhibits the growth of the fungus. Apparently there are corn genes that 
code for each of these proteins. Researchers are now trying to develop 
a quick biotechnology test for these proteins and to locate the 
associated genes on the map of the corn genome. Among other advantages, 
this will enable corn breeders to use marker-assisted selection, a 
molecular selection technique, which should greatly speed the process 
of screening and selecting high-yield, aflatoxin-resistant lines of 
corn.
    This year we started work with inbred line C12, which has good 
levels of resistance and also makes a protein that blocks some, but not 
all, aflatoxin synthesis. If we can enhance the production of these 
blocking proteins and transfer the gene or genes that code for them 
into otherwise productive corn hybrids, several advantages will accrue. 
First, fewer genes will have to be transferred to achieve the desired 
result. This should speed up the process of incorporating desirable 
aflatoxin-reducing genes into commercially important hybrids. Since the 
aflatoxin-synthesis-blocking corn genes will place little selection 
pressure on the fungus itself, the fungus will be less likely to 
develop ways to defeat the resistance mechanism.
    Once these genetically controlled resistance mechanisms are fully 
characterized and understood, the resistance genes can be transferred 
to other crops, such as peanuts, that also have aflatoxin problems. The 
aflatoxin resistance mechanisms described above may resist other 
diseases as well. Corn lines identified in this project that are 
resistant to A. pavus also are resistant to Fusarium maniliforme, which 
produces fumonison, another highly toxic and carcinogenic mycotoxin. 
There is direct evidence that fumonison causes cancer in humans, not 
just in laboratory animals.
Fiscal year 1998 biotechnology breakthrough
    After years of effort, we experienced a major breakthrough during 
early fiscal year 1998 with the successful introduction of antifungal 
genes bean chitinase and B-1,3-glucanase into corn cells, both alone 
and in combination. The particle gun was used to accomplish this 
transformation. The transformed cells were regenerated into plants and 
were self-pollinated to obtain plants that are homozygous for the 
antifungal genes. Subsequently, we demonstrated by several different 
methods that the introduced genes are stable, are passed to progeny in 
normal reproduction, and are expressed in seeds of the transformed 
plants. In other species, these particular genes are expressed as 
enzymes that break down cell walls of invading fungi, thus preventing 
or reducing fungal diseases. We found that Tex 6, which confers the 
highest level of natural fungal resistance, has high levels of natural 
chitinase in its tissues. This is a different chitinase, however, than 
the one we introduced by ombinant DNA techniques.
Plans for fiscal year 2000
    In fiscal year 2000, we will conduct tests to determine how 
effective the bean chitinase and B-1,2-chitinase genes are, alone and 
in combination with resistance genes already identified in corn, in 
sting A. paves and aflatoxin production. We anticipate that the 
combination will be most effective and will, when incorporated into 
widely used hybrids, go far toward solving the aflatoxin problem. It 
will be very important to determine if a combination of chitinases 
confer greater and more lasting resistance than only one. We will also 
seek to enhance natural resistance to A. flavus through conventional 
breeding techniques and will conduct further research aimed at 
increasing the resistance of high oil corn hybrids to the pathogen.
Cooperation
    We continue to have good cooperation with other institutions and 
USDA-ARS. Several sources of resistance we discovered and several 
resistant lines derived from them have been shown to be resistant in 
field studies conducted by cooperators in Mississippi and south Texas. 
We are also cooperating with Professor Dennis McGee at Iowa State 
University, who found that the silks on our resistant lines inhibit 
growth of A. paves. Professor Gary Payne of North Carolina State 
University continues to make valuable contributions to the project.
                          summary and request
    We believe this project is making excellent progress toward the 
desired outcome of reducing or eliminating aflatoxin as a serious 
problem in corn production and use. To summarize project results to 
date, we identified several corn lines that are resistant to the 
organism (Aspergillus paves) that produces ear rot and produces 
aflatoxin. We also discovered lines that inhibit aflatoxin production 
without inhibiting fungal growth. This increases the possibility of 
inducing aflatoxin resistance that does not decrease with time.
    We derived new lines that have both types of resistance. We learned 
how aflatoxin resistance is inherited when crosses are made. We have 
sources of resistance that are effective when used in either the 
northern or southern corn belt. We developed practical tissue culture 
tests and DNA analysis techniques to identify resistant germplasm. We 
found that high oil corn hybrids are more susceptible to aflatoxin-
producing organisms than normal hybrids, but that resistance sources 
developed in this project can be used to produce resistant high oil 
corn. We showed that fungicides decrease A. pavus growth in stored 
grain. Procedures for this are still awaiting approval by EPA. The 
project continues to generate important papers in scientific journals. 
The papers provide valuable information on both practical and basic 
science issues associated with aflatoxin.
    In a landmark achievement, we introduced antifungal genes bean 
chitinase and B-1,3-gluconase from other organisms into corn cells and 
successfully regenerated plants that have these genes. We found that 
the introduced genes are stable, passed to progeny during normal 
reproduction, and expressed in seeds. We still need to screen more 
germplasm for resistance sources. Natural resistance genes tend to work 
for a while and then become less effective as the pests evolve new 
virulence mechanisms. We still have to broaden the base of inbred lines 
that will be used to introduce aflatoxin resistance into commercial 
varieties grown in the major corn growing regions of the nation. Our 
goal is to insert new resistance genes that can be moved rapidly into 
commercially used inbreds and that are effective in reducing and 
eliminating other mycotoxins as well.
    We respectfully request an allocation of $180,000 in federal funds 
for fiscal year 2000 to continue this Important project. This amount 
will allow us to maintain the momentum and productivity of this 
innovative aflatoxin research program and capitalize on the progress 
made to date.
                                 ______
                                 
             Prepared Statement of the University of Miami
    Mr. Chairman and Members of the Subcommittee, I appreciate the 
opportunity to present testimony on behalf of the University of Miami. 
The University is seeking your support for a vital initiative within 
your purview, the Florida Center for Climate Prediction. It is our 
belief, Mr. Chairman, that technological advances in climate prediction 
can save the nation's downtrodden farmers from financial crises.
    On March 16, 1999, Federal Reserve Chairman Alan Greenspan reported 
that the nation's farm downturn can be traced to an important degree to 
the recessions that began in East Asia in 1997 and have since spread to 
Latin America and elsewhere. However, Mr. Greenspan cited technological 
improvements as vitally important for insulating U.S. agriculture from 
the worse effects of world-wide economic turmoil.
    The Florida Consortium for Climate Prediction, a joint project of 
the University of Miami, the University of Florida, Florida State 
University brings to bear the latest climate prediction technology, 
which can provide the nation's farmers with predictive information to 
help maintain stable agricultural production.
    This major collaborative program focuses on climate variability in 
Florida, the southeast region and beyond. Objectives include developing 
scientific applications for climate data. The Florida Consortium draws 
upon the expertise of scientists at Florida State University (climate 
analyses and coupled ocean-atmosphere prediction models), Miami 
(climate analyses and economic value forecasts) and the University of 
Florida (agriculture) to quantify climate variability (e.g. El Nino) 
for the southeast and to explore the potential value and practical 
application (with strong emphasis on agricultural issues) of climate 
forecasts.
    The importance of El Nino South Oscillation (ENSO) events as a 
major source of climate fluctuations, together with advances in ENSO 
predictability, suggest that forecasts have significant potential for 
benefiting agricultural productivity and economic decision-making.
    The geographic focus of this project will include the southeastern 
United States, a large food producer whose productivity is 
significantly impacted by weather conditions generated by the ENSO 
phenomenon. Decisions made by well-informed participants from farm to 
policy level, made several months or seasons in advance, can 
significantly benefit productivity.
    This project presents an end-on-end approach that will provide the 
bridge between climate and forecast producers, such as the 
International Research Institute for Climate Prediction (IRICP) and 
agricultural decision-makers. Specific objectives of the project are 
to: (1) adapt, develop, and evaluate a generic, flexible set of tools 
and methodologies for assessing regional agricultural consequences of 
El Nino events and for applying forecasts to improve agricultural 
decision-making; (2) demonstrate by successful applications of 
forecasts to agriculture and other sectors that would benefit best in 
the southeastern United States that began in 1996; and assess the value 
of climate predictions to different agricultural sectors in those 
southeastern regions.
    As an example, during the initial phases of this effort, the team 
focused on temperature and precipitation patterns across the southeast. 
At Florida State, for example, researchers found a geographic shift in 
tornadic activity associated with El Nino events. A new climate 
forecast system to provide predictions of seasonal temperatures and 
precipitation with longer lead times and improved skill is in the 
testing phase. Improvements are due party to the coupled nature (i.e., 
linking the ocean and atmosphere so they respond to one another 
dynamically) of the forecast system. Our colleagues at the University 
of Florida identified several crops in Florida that are vulnerable to 
shifts in weather patterns associated with El Nino and La Nina, but 
noted further that the impact is not uniform across the state
    In continuing this collaboration, we plan to estimate the economic 
advantages that could be achieved by incorporating climate forecast 
information into farming management systems and eventually work with 
sector representatives in developing guidance products for the 
agricultural community. NOAA and NASA have provided initial funding.
    Mr. Chairman, for fiscal year 2000, we seek $4 million from the 
Agriculture Appropriations Subcommittee through the Department of 
Agriculture to continue and expand this critical work for the 
agricultural community.
    Mr. Chairman, we understand how difficult year this will be for you 
and the Subcommittee. However, we respectfully request that you give 
serious consideration to this vital initiative. It has great 
implications and will provide exceptional benefits to the well-being of 
the nation.
                                 ______
                                 
      Prepared Statement of the U.S. Marine Shrimp Farming Program
    Mr. Chairman, I am pleased to have the opportunity to provide the 
Committee with an overview of the activities of the U.S. Marine Shrimp 
Farming Program.
    This integrated multi-state research program continues to develop 
and transfer technologies, products and services necessary for domestic 
shrimp farming to become competitive in the world market. The long-term 
goals are to partially offset the annual $2.5 billion trade deficit, 
significantly expand the domestic shrimp industry, create new 
opportunities for U.S. agriculture, and forge new markets for U.S. 
grain products and technology services.
    Success in the United States requires high rate, high yield, and 
high product quality production systems that are both environmentally 
and economically sustainable. The United States is a world leader and 
highly competitive in terrestrial animal production systems. However, 
because no such integrated production system exists for marine shrimp, 
this program undertook the task of developing a world competitive 
shrimp production system, technology-by-technology and product-by-
product. The U.S. Marine Shrimp Farming Program, supported by this 
Committee since 1985, undertook the development of high tech processes, 
products, and services designed to make U.S. shrimp farmers competitive 
in the world market.
    The Consortium enlisted the participation of top scientists, their 
institutions and states, the cooperation of the fledgling industry, and 
participation of government scientists and administrators, to undertake 
narrowly-focused and results-oriented projects, and to provide a sound 
scientific basis for industry expansion. Its approach is based on 
financial accountability and minimal bureaucratic constraint. The 
Program has been administered by CSREES/USDA, which provides oversight 
and conducts periodic review by independent scientific panels.
    The obstacles to be overcome by new technologies and products, in 
order to underpin a competitive advantage for U.S. farmers, were 
formidable. Worldwide, shrimp farming practices are primitive as 
compared to modern animal husbandry standards. They depend on catching 
wild shrimp stocks, have little regard for the environmental 
consequences of their actions, use drugs and chemicals 
indiscriminately, and contribute to the spread of shrimp diseases with 
their products; this approach has often been referred to as ``rape and 
run.'' These practices, while low-cost in the short-run, are not 
sustainable environmentally or economically in the long-run. Currently, 
world wide producers are experiencing increasing shrimp mortalities, 
lower quality product, and lower profits. These world wide problems 
open a substantial opportunity for U.S. exploitation of the 
technologies and products developed by the Consortium.
    To date, the program has:
  --established the world's first captive populations of high health 
        shrimp stocks and the world's first breeding and genetic 
        selection program for marine shrimp
  --completed pioneering research and development in advanced molecular 
        diagnostic tools for disease screening and control;
  --described the etiology of shrimp diseases associated with viral 
        pathogens;
  --supported members of the U.S. American Processors Association in 
        protecting receiving waters from the introduction of viral 
        pathogens;
  --played a lead role in the Joint Subcommittee on Aquaculture's 
        efforts to assess the threat of foreign viral pathogens;
  --supplied the U.S. industry with genetically improved and disease 
        resistant shrimp stocks;
  --developed small-scale high technology biosecure shrimp production 
        systems to protect both cultured and wild stocks from disease
  --developed new feed formulations to minimize waste generation.
    These accomplishments are encouraging. The advances in these 
fundamental areas have provided the foundation for achieving the 
overall goal. The Consortium is in the process of integrating these 
advances into practical shrimp farming systems. USMSFP supports both 
industry and research. We are in the process of integrating these 
advances into working shrimp farming systems for demonstration 
purposes. The industry does not yet have the technology package and 
remains dependent upon the Consortium for critical products and 
services.
    Abrupt loss of Consortium support would cut the existing industry 
off at the knees and preclude completion of this important work. In 
anticipation of near-term technology transfer, we are encouraging the 
industry to establish its own breeding program and disease control 
operations. The risks, however, are as yet too high to encourage the 
movement of investment capital. We are making substantial progress 
toward increasing profitability and reducing risk.
    Mr. Chairman, it is envisioned that the United States, with the 
best animal feed grains in the world, will become a non-polluting 
producer and major competitor in the shrimp farming world. Superior 
technologies, products, and services will deliver higher quality and 
lower cost shrimp products to the nation and to the world.
    The Consortium receives substantial support and encouragement from 
CSREES/USDA. They have suggested that this is a model program for 
resolving important problems and capturing opportunities in both 
agriculture and aquaculture. Such sentiments have been repeatedly 
expressed by independent scientific review teams in 1988, 1991, and 
1995.
    Exceptional research and development progress in the last several 
years, coupled with severe difficulties experienced by domestic shrimp 
farmers, form the basis of a request for an increase in funding from 
$3.354 million to $5 million. The additional resources would be 
directed to accelerate the transfer of high technology biosecure 
systems to the commercial industry, to assist the industry in retro-
fitting existing production systems, and to strengthen research in 
biosecurity and disease control technologies.
                                 ______
                                 
      Prepared Statement of the University of Southern Mississippi
    Mr. Chairman, distinguished Members of the Subcommittee, I would 
like to thank you for this opportunity to provide testimony describing 
ongoing research and commercializing efforts of The University of 
Southern Mississippi (USM) and the Mississippi Polymer Institute. I am 
very grateful to the Subcommittee for its leadership and the support of 
the Institute and its work. This testimony will include an update on 
the progress of the Institute since my testimony of approximately one 
year ago. During the past year, our efforts have primarily focused on 
two commercialization thrusts; one arising from novel inventions of our 
emulsion polymerization team and the other to produce a commercially 
viable, formaldehyde free, soybean derived adhesive for a variety of 
composite board materials, i.e., particle board or oriented strand 
board (OSB). During the past year, we have continued to exploit the 
opportunities offered by these novel materials and continue to be 
optimistic about their commercial fate. I will discuss the two 
inventions separately in order to offer more clarity. In the case of 
castor or soya oil we have designed and synthesized novel monomers or 
polymer building blocks that offer state-of-the-art technology. The 
attributes of the technology includes odor free, solvent free, non-
polluting latex coatings. The technology offers for the first time, 
solventless emulsion technology based on an agricultural material. By 
contrast, contemporary latex coatings contain upwards of 1500 grams of 
VOC/gallon. Moreover, it is a technology that if practiced would allow 
the governmental regulatory agencies to tighten the restrictions on 
volatile organic content (VOC) emissions of applied coatings. I intend 
to share details of this novel and patented technology with the 
Environmental Protection Agency so that they can, if they wish, make an 
independent evaluation to confirm its suitability and efficacy. Much of 
the fundamental scientific principles regarding its mode of action have 
been confirmed, yet additional data must be collected. In particular, 
we believe this technology can be employed in light industrial and 
original equipment manufacture (OEM) industrial coatings as well as 
architectural coatings, and confirmation of these concepts is a 
priority in future work. The second and critically important objective 
is to secure manufacturing facilities for commercial production of the 
new material(s). We are currently in negotiations with parties who have 
expressed interest in manufacturing the novel emulsion monomers. We 
must secure a manufacturer during the 1999-2000 period if this 
technology is to be successful. For instance, we have provided samples 
to our industrial partners from samples prepared in our laboratory. 
However, requests for the novel material are far too great to continue 
this practice, and one industrial client has expressed interest in 
purchasing this monomer in the third or fourth quarter of 1999.
    Furthermore, the uniqueness of this technology has been confirmed 
in industry, and at least one participating polymer manufacturing firm 
is sampling materials they have produced utilizing our novel 
technology. Therefore, we believe that the time when industrial firms 
will seek production quantities of the novel monomer is drawing closer, 
and we must be prepared to meet their needs. This is indeed an exciting 
time as we see the fruition of our efforts and your support coming to 
the conclusion we desire; i.e., the commercial production and sale of 
novel ag based materials to the polymer industry.
    In yet another of our novel ag based technologies, we have 
developed formaldehyde-free adhesives for use in the composites 
industry, specifically for particle board and oriented strand board. 
The new adhesives are composed of more than 98 percent agricultural 
products and are comparable in properties with traditional formaldehyde 
adhesives. Formaldehyde emissions are regulated as formaldehyde is 
considered a potential cancer producing agent. Consequently, there is a 
move afoot to remove formaldehyde from articles of commerce.
    In 1983, the Mississippi Legislature authorized the Polymer 
Institute at USM to work closely with emerging industries and other 
existing polymer-related industries to assist with research, problem-
solving, and commercializing efforts. During the past year, seventeen 
new polymer-related industries have located in Mississippi. In 
particular, during the past four years Sunbeam-Oster, Dickten and 
Masch, Wellman, and Kohler have constructed facilities approaching a 
cost of 1.4 billion dollars and each has commented on polymer science 
and engineering as a significant factor in their decision to locate 
near to The University of Southern Mississippi and the Mississippi 
Polymer Institute.
    The Institute provides industry and government with applied or 
focused research, development support, and other commercializing 
assistance. This effort complements existing strong ties with industry 
and government involving exchange of information and improved 
employment opportunities for USE graduates. Most importantly, through 
basic and applied research coupled with developmental and 
commercializing efforts of the Institute, the Department of Polymer 
Science continues to address national needs of high priority.
    The focus of my work is commercialization of alternative 
agricultural crops in the polymer industry. This approach offers an 
array of opportunities for agriculture as the polymer industry is the 
largest segment of the chemical products industry in the world, and 
heretofore has been highly dependent upon petroleum utilization. 
However, my efforts are directed to the development of agricultural 
derived materials that will improve our nation's environment and reduce 
our dependence on imported petroleum. As farm products meet the 
industrial needs of the American society, rural America is the 
benefactor. Heretofore, this movement to utilize alternative 
agricultural products as industrial raw materials has received some 
attention but much less than opportunities warrant. Your decisions are 
crucial to the accomplishment of these goals as funding from this 
Subcommittee has enabled us to implement and maintain an active group 
of university-based polymer scientists whose energies are devoted to 
commercializing alternative crops. We are most grateful to you for this 
support and ask for your continued commitment.
    The faculty, the University, and the State of Mississippi are 
strongly supportive of the Mississippi Polymer Institute and its close 
ties with industry. Most faculty maintain at least one industrial 
contract as an important part of extramural research efforts.
    Polymers, which include fibers, plastics, composites, coatings, 
adhesives, inks, and elastomers, play a key role in the materials 
industry. They are used in a wide range of industries including 
textiles, aerospace, automotive, packaging, construction, medical 
prosthesis, and health care. In the aerospace and automotive 
applications, reduced weight and high strength make them increasingly 
important as fuel savers. Their non-metallic character and design 
potentials support their use for many national defense purposes. 
Moreover, select polymers are possible substitutes for so-called 
strategic materials, some of which come from potentially unreliable 
sources.
    As a polymer scientist, I am intrigued by the vast opportunities 
offered by American agriculture. As a professor, however, I continue to 
be disappointed that few of our science and business students receive 
training in the polymer-agricultural discipline as it offers enormous 
potential. The University of Southern Mississippi and the Mississippi 
Polymer Institute are attempting to make a difference by showing others 
what can be accomplished if appropriate time, energy, and resources are 
devoted to the understanding of ag based products.
    I became involved in the polymer field 33 years ago and since that 
time, have watched its evolution where almost each new product 
utilization offered the opportunity for many more. Although polymer 
science as a discipline has experienced expansion and a degree of 
public acceptance, alternative agricultural materials are an under-
utilized national treasure for the polymer industry. Moreover, there is 
less acceptance of petroleum derived materials today than ever before 
and consequently the timing is ideal for agricultural materials to make 
significant inroads as environmentally friendly, biodegradable, and 
renewable raw materials. These agricultural materials have always been 
available for our use, yet society for many reasons, has not recognized 
their potential. The following examples are included and represent 
opportunities other than those already described which supports this 
tenet:
  --A waterborne, waterproofer has been designed and formulated with 
        the help of several natural products. The material functions as 
        a waterproofer yet is carried in water. However, after 
        application to the intended substrate, typically wood or 
        cementous products, the material becomes hydrophobic and highly 
        water resistant. We have collected two and one-half years of 
        exposure data on this product with excellent success. It is 
        currently being marketed via Southern Chemical Formulators of 
        Mobile, AL. The distribution of this material has been slowed 
        as the result of a fire at Southern Chemical Formulators that 
        destroyed production facilities.
  --A new, multi-functional polymer additive was designed, synthesized, 
        tested, and submitted to the patent office. The patent office 
        has approved the issuance of a patent entitled, ``Novel Multi-
        Functional Surface Active Agents, Syntheses and Applications 
        Thereof,'' U.S. patent No. 5,807,922; the patent was issued on 
        Sept. 15, 1998. The product is currently being evaluated by the 
        Hanson Company as a potential commercial product. It is a 
        highly efficient, multi-faceted additive that functions as a 
        dispersant, a defoamer, an adhesion promoter, a gloss enhancer, 
        and corrosion inhibiting species. It is derived from an 
        agricultural raw material and is very novel in its performance 
        and applications. If the Hanson Company is unsuccessful in its 
        utility, we will continue commercialization efforts from these 
        laboratories.
  --We have exploited the potential of lesquerella, a crop that 
        produces a triglyceride similar to castor oil. Several high 
        performance products have been prepared and include polyesters, 
        stains, foams, pressure sensitive adhesives, and 100 percent 
        solid ultraviolet (W) coatings. This technology was highlighted 
        at the AARC/NASDA meeting in Washington, DC.
  --Novel open cell foams have been designed and prepared from 
        lesquerella and/or castor oil. They are of high quality and can 
        substitute for foams used extensively in industrial settings.
    Lesquerella derived foams possess commercial viability yet the 
supply of lesquerella is currently not of the size that can support a 
high volume use. For instance, if lesquerella were accepted as a raw 
material for foam manufacture alone, huge quantities of oil would be 
consumed. The decision is now with the farm community as to whether or 
not to include lesquerella in their farm land rotation sequence. Our 
work has shown it to be a viable commercial crop with several 
significant potential uses and that was our goal. Consequently, we will 
concentrate our work in other areas with other ag crops.
    U.S. agriculture has made the transition from the farm fields to 
the kitchen tables, but America's industrial community continues to be 
frightfully slow in adopting ag based industrial materials. Let us 
aggressively pursue this opportunity and in doing so:
  --Intensify U.S. efforts to commercialize alternative crops.
  --Reduce U.S. reliance on imported petroleum.
  --Maintain a healthy and prosperous farm economy.
  --Foster new cooperative opportunities between American farmers and 
        American industry.
    Mr. Chairman, your leadership and support are deeply appreciated by 
the entire University of Southern Mississippi community. While I can 
greatly appreciate the financial restraints facing your Subcommittee, I 
feel confident that further support of the Mississippi Polymer 
Institute will continue dividends of increasing commercialization 
opportunities of agricultural materials in American industry. Advances 
in polymer research are crucial to food, transportation, housing, and 
defense industries. Our work has clearly established the value of ag 
products as industrial raw materials; however, while these are but a 
limited number of applications, our success confirms that it is time to 
move to yet another level of effort. Thus, we respectfully request $1.2 
million in federal funding to exploit the potentials of commercializing 
alternative agricultural materials and to continue our initiatives. 
Thank you Mr. Chairman and Members of the Subcommittee for your support 
and consideration.
                                 ______
                                 
  Prepared Statement of the Upper Mississippi River Basin Association
    The Upper Mississippi River Basin Association (UMRBA) is the 
organization created 18 years ago by the Governors of Illinois, Iowa, 
Minnesota, Missouri, and Wisconsin to serve as a forum for coordinating 
the five states' river-related programs and policies and for 
collaborating with federal agencies on regional water resource issues. 
As such, the UMRBA has an interest in the budget for the U.S. 
Department of Agriculture's conservation programs and technical 
assistance.
    Of particular concern to the UMRBA is funding for the Conservation 
Reserve Program (CRP), Wetlands Reserve Program (WRP), and 
Environmental Quality Incentives Program (EQIP). Taken together, these 
three Commodity Credit Corporation-funded programs provide an 
invaluable means for the USDA to work with landowners, local 
conservation districts, and the states to ensure that agricultural 
productivity is maintained while protecting the nation's soil and water 
resources. As stewards of some of the nation's most productive 
agricultural lands and important water resources, the five states of 
the Upper Mississippi River Basin believe these programs are vital. 
Strong farmer interest and state support demonstrate the region's 
commitment to the objectives of these programs. In 1998, state, local, 
and private entities matched every dollar of NRCS investment in the 
five states with an additional $0.80. Illinois and Minnesota are among 
the first states nationwide to commit to significantly increased state 
funding of conservation measures through the Conservation Reserve 
Enhancement Program (CREP). These CREP initiatives will be focused on 
the watersheds of the Illinois and Minnesota Rivers, both of which are 
important tributaries to the Upper Mississippi.
    The President's fiscal year 2000 budget proposal includes 
essentially flat funding of $1.596 billion for the CRP, which the 
Administration estimates would be sufficient for the program to reach 
its full authorized acreage of 36.4 million acres by 2002. The Natural 
Resources Conservation Service (NRCS) estimates that the President's 
$209 million proposal for the WRP would bring that program to its 
975,000-acre enrollment cap by the end of 2000. The Administration's 
proposed $126 million increase for EQIP, which would bring the 
program's total in fiscal year 2000 to $300 million, includes important 
funding to increase financial assistance available to the operators of 
animal feeding operations. The CRP, WRP, and EQIP have demonstrated 
their effectiveness and garnered strong support from state, local, and 
landowner partners. Thus, the UMRBA believes it is essential to place 
priority on providing adequate resources to these three important 
programs.
    The UMRBA is also concerned with the adequacy of funding and 
staffing levels in the NRCS' conservation operations account. The 
technical assistance funded through conservation operations provides 
the foundation for the USDA's voluntary conservation planning. The 
President has proposed increasing conservation technical assistance by 
$37 million to $585 million in fiscal year 2000. This funding increase 
is certainly a move in the right direction. However, it would be 
coupled with an estimated net reduction of 1,055 staff people, most of 
whom would come from field offices. These are the very employees that 
NRCS relies upon to deliver vital technical assistance to landowners. 
With this reduction, the overall cut in NRCS staff since 1993 would 
reach almost 19 percent. Reports from the field indicate that these 
reductions are beginning to take a toll, with the NRCS increasingly 
unable to provide the timely, comprehensive technical assistance that 
farmers need if they are to participate effectively in the USDA's 
conservation programs. A 1998 National Workload Analysis indicated that 
the NRCS may need as many as 4,000 employees at the field level in the 
Midwest. At the time, actual field staff in the Midwest numbered fewer 
than 2,500. The UMRBA urges Congress to ensure that the NRCS has both 
the staff and funding necessary to deliver its conservation programs 
effectively.
    The five states of the UMRBA acknowledge that our region faces 
enormous soil and water conservation needs and limited public and 
private resources to address the problem. In this context, it is 
imperative that NRCS work with the states, conservation districts, and 
farmers to identify and target the most pressing problems. Coordination 
and communication with the states is particularly critical to success 
in addressing the interstate resource challenges faced by the Upper 
Mississippi River. Success in addressing such complex, large-scale 
issues will not come quickly. It will require long-range thinking and 
commitment over time from all levels of government and from farmers. 
The states look to both Congress and the Administration to join them in 
providing such leadership.
                                 ______
                                 
             Prepared Statement of the USA Rice Federation
    The USA Rice Federation wishes to submit the following comments 
regarding the fiscal year 2000 appropriation bill for the Department of 
Agriculture. The USA Rice Federation represents producers of 
approximately 80 percent of the rice grown in the United States and 
practically all U.S. millers of rice as well as allied industries.
    Background.--The national farm economy is in a period of financial 
stress with low prices, record supplies, and weak exports. The rice 
economy is no exception. Production currently is estimated to increase 
this year to 188 million cwt., up 3 percent from last year and will be 
the second largest crop on record. Exports are not expected to keep 
pace with production, leading USDA to estimate that ending stocks will 
be 44 percent higher than a year ago resulting in the highest stocks to 
use ratio since 1994/95. Rough rice sales to Latin America, one of our 
principal markets, are likely to be adversely affected by economic 
problems there, and the global long grain milled market will be very 
competitive, particularly with lower priced rice from Thailand and 
Vietnam. Prices have been falling steadily, and are expected to 
continue. It may well be that for the first time in many years payments 
under the marketing loan program will be triggered.
    Export Programs.--(a) Public Law 480. With this as a background, 
the rice industry calls upon the appropriations committee to ensure 
that the export programs are fully funded for fiscal year 2000. To this 
end, we earnestly request that the appropriation for the Public Law 480 
program be maintained at not less than the appropriation of $220 
million for the current year, and not be allowed to drop as has been 
recommended by the Administration. In the current fiscal year the title 
I, Public Law 480 program was funded at a level of $220 million and was 
supplemented by the Secretary making an emergency transfer of $850 
million from Commodity Credit Corporation to fund a title I agreement 
with Russia. The Secretary found this necessary despite the 
Administration having earlier recommended a 50 percent cut in the 
fiscal year 1999 appropriation. It is hard to understand why in the 
light of the distressed farm economy, the Administration would wish to 
reduce the appropriation for title I to $150 million and eliminate 
entirely the appropriation for title III of $25 million. The outlook 
for agriculture in fiscal year 2000 is no better than current 
conditions, and if anything, would justify an increase from the 
currently appropriated amount.
    As you know, in programming sales under title I, priority is given 
to those developing countries which have demonstrated the potential to 
become commercial markets and are undertaking measures to improve their 
food security and demonstrate the greatest need for food. Title I has 
had a brilliant history in opening the doors for commercial sales as 
the recipient countries improve their economies. It should not be 
short-changed.
    (b) Market Access and Foreign Market Development Programs. There 
are other important programs that assist in opening markets for U.S. 
agricultural products including rice. These include the market access 
program which is funded at a level of $90 million and the foreign 
market development program (FMD) program, often called the cooperator 
program, in which the rice industry and other cooperators provide cost 
sharing of at least an equal amount in carrying out market promotion 
activities overseas. These have been successful programs and should be 
fully funded. Accordingly, we ask that the MAP program not be cut back 
and the FMD program continue to be funded at the prior year's level of 
$30 million.
    Research.--Another area of great interest to the rice industry lies 
with the research activities of USDA. We support the increased funding 
that is recommended by USDA for the Agricultural Research Service and 
the Cooperative State Research, Education and Extension Service. We 
request that the appropriation for research at the Dale Bumpers 
National Rice Research Center at Stuttgart, Arkansas, be increased from 
last year's level by $500,000. This would enable the Center to hire the 
researchers needed to carry out the important work of developing 
germplasm which would be made available to plant breeders in the United 
States. The germplasm would be used to develop plant varieties to meet 
the demands of consumers of all kinds both here in the United States 
and elsewhere in the world, thereby improving markets for U.S. rice.
    In addition, in the funding of the Cooperative State Research and 
Education and Extension Service (CSREES), the Administration has 
proposed an increase for competitive projects that would be offset by 
decreases in formula funds under the Hatch Act and related legislation 
and by decreases in non-competitive projects. We object to any 
reduction in the formula funds as this would adversely impact the land 
grant universities and state experiment stations where so much 
significant agricultural research including research of benefit to the 
rice industry, is being conducted. We would not object to an increase 
in funding of competitive grants, but not at the expense of the formula 
funds.
    Animal Damage Control.--The USA Rice Federation also requests that 
the appropriation for wildlife service operations and research be 
continued at the same level as in the current year. This appropriation 
helps fund new and improved methods for reducing damage to the southern 
rice crop from the depredations of blackbirds that engulf the area each 
spring. Among other things, the appropriation for the APHIS National 
Wildlife Research Center is used for research on new non-lethal bird 
repellents for preventing blackbird damage to sprouting and ripening 
rice and for a more effective formulation for an EPA registered 
chemical. A reduction in either this appropriation or the appropriation 
for wildlife service operations would adversely affect these efforts.
    We appreciate the opportunity to submit these comments for the 
consideration of the Subcommittee. If you should have any questions or 
would like us to amplify our remarks in any way, please let us know.
                                 ______
                                 
 Prepared Statement of the U.S. Agricultural Export Development Council
    Strong support for exports must be part of the ``safety net'' for 
the American farmer. Increasing exports is a significant tool to 
improve the lives of America's farmers and producers of USA 
agricultural products while improving our balance of trade and 
increasing receipts to the Treasury. Well-funded export programs must 
become a top priority for this Congress. Therefore, the U.S. 
Agricultural Export Development Council (USAEDC) respectfully but 
emphatically urges this subcommittee and Congress to strongly support 
export promotion programs in the U.S. Department of Agriculture's 
(USDA) fiscal year 2000 budget. Specifically, this shall include: a 
Foreign Market Development Cooperator program at a level which would 
allow FAS to approve marketing plans at historic levels, and within the 
FAS authorization; a Market Access Program at $200 million; and a 
strong USDA Foreign Agricultural Service at least at no less than last 
year's budget level.
    A few years ago USA agricultural exports reached record levels. 
Unfortunately, the current downturn in many foreign economies has made 
it very difficult today to simply maintain markets for USA agricultural 
exports let alone expand them. Since the downturn, there are additional 
and significant hurdles to the pre-existing import tariffs and often-
unjustifiable sanitary and phytosanitary barriers. These additional 
hurdles include the rise of the U.S. dollar against foreign currencies, 
foreign consumers' bias toward ``buying domestic'' to help their own 
producers, and increased production from our major competitors (e.g., 
the European Union, Canada, Australia). USA agricultural products are 
facing more competition than ever, especially in markets where there 
are fewer foreign consumers willing to consider buying USA agricultural 
products. Given these factors, it behooves Congress to fund an 
aggressive export promotion package for America's USA agricultural 
products to have a fighting chance to maintain and grow foreign markets 
for our agricultural products.
    Chief within this export promotion package should be substantial 
and adequate funding for the Foreign Market Development Cooperator 
program (FMD), the Market Access Program (MAP), and USDA's Foreign 
Agricultural Service (FAS) which administers these programs. As you may 
know, the FMD program is most often focused on maintaining foreign 
markets while working on long-term changes to a market's infrastructure 
to allow for increased USA agricultural exports. The MAP program is 
most often focused on increasing export levels in the near term, 
especially for USA agricultural exports that are purchased directly by 
consumers. Funding for both programs is awarded annually on a 
competitive basis to (1) not-for-profit USA trade organizations that 
represent specific sectors of American agriculture, (2) farmer 
cooperatives, and (3) small businesses within the USA agriculture and 
food industries. The vast majority of marketing is generic in nature 
with any branded programs being run by small businesses (less than 
1,000 employees) that are most often new to the export market.
       there are 5 important points to remember about fmd and map
    First, the FMD and MAP programs are cost effective.--Funds are 
awarded on a competitive basis via a meaningful formula developed by 
FAS which takes into consideration export potential, experience with 
managing export programs, as well as industry contributions. This 
process helps ensure that U.S. taxpayers' money is being invested in 
the agricultural sector and organization with the highest chance of 
success. Second, every organization that participates in either the FMD 
or MAP program must contribute its own resources to these programs. 
Thus, U.S. Government expenditures actually leverage more resources for 
foreign market promotion than American agriculture would be able to 
accomplish with only private sector funds. In addition, many of the 
small companies helped by the MAP branded program note that they often 
would not be able to have gained entry into the export market were it 
not for this program. The tables below show that for the last completed 
program year, American agriculture contributed the highest amount of 
their own money relative to the amount made available by FAS.

                               FOREIGN MARKET DEVELOPMENT/COOPERATOR PROGRAM ONLY
----------------------------------------------------------------------------------------------------------------
                                                                                                      Percent of
                                                                 Private-sector   Public-sector MAP   private to
                         Program Year                              MAP annual           annual        public MAP
                                                                  expenditure        expenditure       dollars
----------------------------------------------------------------------------------------------------------------
1994.........................................................        $38,275,000        $30,051,000        127.4
1995.........................................................         40,675,000         31,199,000        130.4
1996.........................................................         37,544,000         28,807,000        130.3
1997.........................................................         47,203,000         28,986,000        162.8
1998.........................................................         43,972,000         26,505,000        165.9
5 yr. average................................................         41,534,000         29,110,000        142.7
----------------------------------------------------------------------------------------------------------------


                                            MARKET ACCESS PROGRAM ONLY
----------------------------------------------------------------------------------------------------------------
                                                                                                      Percent of
                                                                 Private-sector   Public-sector FMD   private to
                         Program Year                              FMD annual           annual        public FMD
                                                                  expenditure        expenditure       dollars
----------------------------------------------------------------------------------------------------------------
1993.........................................................       $146,994,000       $154,372,000         95.2
1994.........................................................        112,756,000        115,756,000         97.4
1995.........................................................         89,179,000        106,353,000         83.9
1996.........................................................         80,190,000         93,585,000         85.7
1997.........................................................        101,208,000         97,549,000        103.8
5 yr. average................................................        106,065,000        113,523,000        93.4
----------------------------------------------------------------------------------------------------------------
Source: USDA/Foreign Agricultural Service, Marketing Operations Staff.

    Second, the FMD and MAP programs increase exports of USA 
agricultural products.--USAEDC posts on the Internet (www.usaedc.org/
exports/industries.html) examples of the progress these programs make 
in increasing sales of USA agricultural products. A few examples 
follow:
A. Texas Grapefruit Exports to Canada--Texas Produce Export Association 
        (TPEA)
            Key Strategies
    Meetings held on a continuous basis with the trade (importers, 
distributors and retailers) by TPEA's in-country representative have 
resulted in acceptance of the fruit. Promoting Texas red grapefruit 
with selected retail store groups interested in a niche market product 
that stands apart from other grapefruit and stressing the unique color 
and sweet taste has convinced consumers to purchase.
    MAP activities assisted the Texas grapefruit industry to increase 
exports to Canada by 32.5 percent over the 1996/97 season and the 
outlook for 1998/99 shipments is very favorable for continued 
increases. A major success has been achieved in the province of 
Ontario, which historically has not been considered a Texas market--
exports in 1997/98 grew by 37.7 percent over the prior year. TPEA 
shipped 430,099 cartons (7,819.9 MT) of grapefruit to Canada in 1997/
98.
            Texas Grapefruit Exports' Impact on Local Economy
    Increasing the export of Texas grapefruit definitely helps to 
provide a better profit level to growers. Faced with a world wide 
oversupply situation, many growers are going out of business, or just 
barely hanging on, because of continuing depressed prices. Exports help 
to stabilize the Texas citrus industry, which directly employs about 
3,000 workers. Without the MAP program, the industry would have 
difficulty expanding the market base and many of these jobs would be in 
jeopardy. There are approximately 750 commercial citrus growers and 16 
registered shippers. Total citrus production is approximately 36,313 
acres.
    In season year 1997, more than 13,235 metric tons of Texas red 
grapefruit were shipped overseas to MAP targeted countries of which 
7,819.9 metric tons were exported to Canada for a value of $3 million, 
up 69.4 percent from 1994/95 when TPEA first started promoting in 
Canada.
B. U.S. Farm-Raised Catfish Exports to Germany--The Catfish Institute 
        (TCI)
            Key Strategies
    Using MAP funds, TCI joined forces with Aramark, the leading food 
service supplier in Germany and the world, to promote U.S. farm-raised 
catfish. In a promotion held at the beginning of September 1998, U.S. 
catfish took center stage in 340 Aramark corporate canteens. From north 
to south and east to west, this one-week promotion transported diners 
to the U.S. South for a variety of imaginative dishes. In preparation 
for the event, TCI held seminars for Aramark's canteen managers on the 
correct preparation of the fish. Over three thousand diners tasted 
``Mark Twain'' catfish sandwiches and American Garlic Catfish with 
Tomatoes and Courgettes as well as several other recipes. The results 
speak for themselves. Aramark sold over 15 tons of catfish, double the 
amount originally planned. TCI promotional materials decorated all of 
the canteens with chefs and servers wearing caps and t-shirts featuring 
the TCI logo, ``Der Amerikanische Wels.''
    U.S. farm-raised catfish faces an 8 percent import tariff, high 
transportation costs, a constantly strengthening dollar which puts its 
fish in the same price category as turbot, considered the premium fish 
by German consumers and trade, plus exacting calibration standards of 
every filet weighing exactly the same. Germany's fish trade continues 
to consolidate which also affects the overall market. Notwithstanding 
this situation, the German trade remains convinced of the quality of 
U.S. farm-raised catfish and repeat orders continue to be made.
            Impact on U.S. Economy
    Return to the U.S. economy from this industry is significant. The 
catfish industry provides 12,000 jobs in the Delta area of the mighty 
Mississippi, encompassing the states of Alabama, Arkansas, Louisiana 
and Mississippi. In a part of the U.S. where unemployment is high and 
income low, this industry employs over 8,000 individuals on a direct 
basis.
  --Related industries such as feed mills, trucking equipment 
        suppliers, packaging companies, steamship and airlines, etc., 
        account for an additional 4,000 jobs.
  --Not only does the catfish industry provide employment, it also 
        leads the way in providing education for low-income workers by 
        participating in the Welfare to Work program, which assists 
        individuals graduate from welfare.
C. California Pistachio Exports to the United Kingdom--California 
        Pistachio Commission
            Key Strategies
    The Commission's immediate move to provide the media and trade with 
positive messages about California pistachios following the September 
1997 European Union ban on Iranian pistachios due to aflatoxin problems 
won praise and support from the British trade. This move turned the 
tide for the California industry and resulted in six of the major 
grocery chains now stocking pistachios from the Golden State up from 
only two the year before.
    Exports are showing upward growth with 327 metric tons shipped in 
the first seven months of 1998 over 212 metric tons in 1997.
    The Iranian government provides preferential treatment in exchange 
rates for pistachio exporters. That government also provides its 
pistachio producers with preferential treatment for imported goods 
purchased with funds maintained out of the country from pistachio 
sales. Producers are also subsidized for the purchase of chemical 
fertilizers and pesticides. Using MAP funds, the California pistachio 
industry has now succeeded in displacing Iranian product in a number of 
key retail stores in the United Kingdom.
            Impact on U.S. Economy
    In 1986, U.S. pistachio exports were minuscule. Twelve years later, 
more than 40 percent of the industry's annual shipments are exported to 
countries around the world. Production is continually increasing with 
174 million pounds harvested in 1997 and 195 million projected for 
1998. This represents a phenomenal increase over the one and a one-half 
million pounds produced in 1986.
    Exports translate into additional U.S. jobs and increased revenue 
for the economy and the U.S. Government. Benefits accrue not only to 
the industry itself, but pass through to the producers of packaging 
materials, equipment, fertilizers, transportation and nursery stock.
    Third, the FMD and MAP programs help American agriculture overcome 
the effects of foreign unfair trade practices.--As noted in the 
pistachio example, USA agricultural exports often face subsidized or 
otherwise unfair competition from foreign products. It is simply 
impossible for American agriculture to combat the multitude of problems 
in the international marketplace on its own. For example, the European 
Union alone spent approximately $365 million in 1997 on export 
programs, far more than the total amount of USA private and public 
funding spent in support of the FMD and MAP programs. FAS is 
instrumental in monitoring such activities in foreign markets. (They 
make available their annual report via the Internet at 
www.fas.usda.gov/cmp/com-study/1997/comp97.html.)
    Fourth, the FMD and MAP programs help keep USA agricultural exports 
strong. which in fiscal year 1997 supported almost 1 million American 
jobs.--These jobs were on the farm, ranch, in the forest, and on the 
water, as well as in transportation, processing, and other related 
industries. Every state and local economy in the Union has jobs that 
are dependent on healthy exports of USA agricultural products. (For a 
state-by-state listing of jobs supported by USA agricultural exports, 
as well as a listing of the top five agricultural commodities which 
generated these jobs, visit USAEDC's web site at www.usaedc.org/
exports/states/indexall html.) The top ten states in fiscal year 1997 
for jobs supported by USA agricultural exports, including wood products 
and fish, were:
    1. California--122,500 jobs--$8.059 billion in ag exports
    2. Iowa--63,000 jobs--$4.147 billion in ag exports
    3. Illinois--57,600 jobs--$3.788 billion in ag exports
    4. Nebraska--50,300 jobs--$3.308 billion in ag exports
    5. Texas--49,900 jobs--$3.283 billion in ag exports
    6. Washington--48,700 jobs--$3.201 billion in ag exports
    7. Minnesota--42,300 jobs--$2.781 billion in ag exports
    8. Kansas--40,300 jobs--$2.650 billion in ag exports
    9. Arkansas--29,600 jobs--$1.948 billion in ag exports
    10. Oregon--29,300 jobs--$1.926 billion in ag exports
    Fifth, the FMD and MAP export effort is supported by American 
voters.--A 1996 national Election Day poll by Penn & Schoen found 75 
percent of Americans surveyed support programs such as FMD and MAP to 
promote U.S. agricultural exports, counter subsidized foreign 
competition, strengthen farm income, and protect American jobs.
    In conclusion, USA agricultural exports are vitally important to 
our local, regional, and national economies. At this time of dire need 
for America's farmers, ranchers, lumbermen, and fishermen, and all the 
jobs their work supports, we need to make sure programs like the 
Foreign Market Development Cooperator (FMD) program and the Market 
Access Program (MAP) are aggressively funded to increase foreign 
consumption of USA agricultural products. Given the state of the global 
economy, now is the time for an extra push in export promotion to 
ensure that whatever foreign money is available for imported food and 
agriculture is spent on the bounty of the United States of America.
                                 ______
                                 
     Prepared Statement of the Western Rural Telephone Association
                          summary of requests
Program of Interest
    Telecommunications lending programs administered by the Rural 
Utilities Service (RUS) of the U.S. Department of Agriculture.
Recommendation
    WRTA supports loan levels for fiscal year 2000 at such amounts as 
they have been designated in the Agriculture Appropriations Act for 
fiscal year 1999 (Public Law 105-277, Sec. 101(a)) for hardship, 
treasury-cost, and guaranteed loan programs and the associated subsidy 
to support these loan programs. We also support the Rural Telephone 
Bank (RTB) loans in the amount proposed in the President's budget and 
the associated subsidy to fund this level. WRTA also supports the 
President's budget request for funding of the RUS's Distance Learning 
and Telemedicine (DLT) programs at $20 million in grants and $200 
million in loan authority. WRTA supports a continuation of the current 
fiscal year's policy of language removing the 7 percent interest rate 
ceiling on Treasury-cost loans for fiscal year 1998. WRTA supports the 
continued provisions contained in Public Law 105-277 restricting 
retirement of RTB class A stock in fiscal year 2000 and prohibiting the 
transfer of RTB funds to the general fund. Finally, we are opposed to 
the President's budget proposal to transfer funds from the unobligated 
balances of the liquidating account of the RTB for the bank's 
administrative expenses and loan subsidy costs.
    Mr. Chairman and Members of the Subcommittee: It is an honor and 
privilege to have the opportunity to discuss the unique infrastructure 
financing needs of the rural local exchange carrier (LEC) industry. My 
name is Sam J. Maselli, and I am the Executive Vice President of the 
Western Rural Telephone Association (WRTA). WRTA is a regional trade 
association representing nearly 150 small rural commercial and 
cooperative telephone systems throughout the western United States and 
the Pacific Rim territories.
Background
    WRTA's member systems, like most of this nation's independent LECs, 
evolved to serve the high cost, low density areas in the rural western 
United States. Congress recognized this unique dilemma confronting 
America's rural LECs as early as 1949 when it amended the Rural 
Electrification Act (RE Act) to create the REA telephone loan program. 
With the future of rural America in mind, Congress charged the REA with 
the responsibility for making low interest rate loans to both ``. . . 
furnish and improve . . .'' rural telephone service at the local 
exchange level.
    In subsequent years, Congress has periodically acted to amend the 
RE Act to insure that the original mission of the program is fully met. 
In 1971, the Rural Telephone Bank (RTB) was created as a supplemental 
source of direct loan financing. In 1973, the REA was provided with the 
ability to guarantee Federal Financing Bank (FFB) and private lender 
notes. And in 1993, the Congress established a fourth lending 
component, the Treasury-cost program, and Congress eliminated most of 
the subsidy costs associated with the administration of the program. 
The formal consolidation of the Department's utility programs through 
transferring the telecommunications loan and technical assistance 
programs of the REA to the Rural Utilities Service (RUS) in 1994 
further served to enhance and update the effectiveness of the agency in 
promoting rural infrastructure development.
    Due to the difficulty of providing service in high cost, low 
density areas, Congress provided for long-term, fixed rate loans 
available at reasonable rates to borrowers to assure that rural 
citizens benefited from the highest quality of telephone service and 
affordable subscriber rates. Through this ongoing commitment to capital 
financing, Congress affirmed the goal of comparable and affordable 
telephone service for rural Americans as their urban counterparts.
    As a result of this commitment to rural telecommunications, rural 
America has greatly benefited from the highest quality of information 
technology. Through its effort, Congress has played a critical role in 
developing a rural telecommunications infrastructure financing program 
which best responds to the needs of rural America.
    The Obligations of the Industry Continue The RUS telecommunications 
loan program represents a remarkable public/private partnership success 
story which continues to produce tangible results in the lives of rural 
citizens. With the assistance of RUS capital and technical standards, 
rural telephone systems are providing modern telecommunications 
services of a highly sophisticated quality. However, with the rapid 
pace of change in the development of information technology, the need 
for RUS telecommunications lending is greater than ever.
    Due to the nature of rural areas, particularly in the rural West, 
the challenge of providing modern telecommunications services is 
formidable. Compared to their urban counterparts, rural communities are 
faced with higher poverty rates, lower income levels, physical 
isolation and higher costs associated with deploying modern 
infrastructure. Economic development is often frustrated by these 
unique rural conditions. With the United States in the midst of the 
``information revolution,'' rural areas are confronted with the dilemma 
of being left behind.
    The implementation of the Telecommunications Reform Act of 1996 has 
also added to the uncertainty and collective uneasiness of the rural 
telecommunications industry. Despite the Act's solid rural safeguard 
provisions, the Federal Communications Commission (FCC) has embarked in 
a regulatory direction which explicitly threatens rural ratepayers, 
services, and infrastructure investment.
    Congress must keep a vigilant watch over the FCC to ensure that 
implementation of the Act is consistent with congressional intent. This 
is particularly true of RUS program borrowers where the federal 
government has a significant loan security interest at stake. Whatever 
the outcome of the regulatory process, the RUS telecommunications loan 
program will be as important as ever to rural systems attempting to 
modernize their networks and improve service to rural residents.
The Promise of the RUS Program
    Despite the obstacles to rural economic revitalization, information 
technology holds significant promise for our rural areas. As we have 
seen in recent years, information services can directly benefit our 
schools, libraries, hospitals and clinics. In addition, 
telecommunications services facilitate commercial opportunities such as 
telemarketing, insurance, and manufacturing not possible in previous 
years.
    While the explosive nature of technological change offers our rural 
communities genuine opportunities for economic and social progress, 
special attention must be placed on providing rural areas with the 
appropriate tools to address their unique set of needs. In this 
context, the RUS telecommunications loan program is playing a critical 
front-line role in ensuring that rural America is linked to the 
Information Superhighway.
    Today, RUS borrowers average only 6 subscribers per mile compared 
to 37 per mile for the larger, urban-oriented telephone systems. This 
results in an average plant investment per subscriber that is 38 
percent higher for RUS borrower systems. Without the availability of 
affordable capital financing, enhancing telecommunications networks for 
rural communities would be untenable.
    The RUS is providing affordable capital financing to allow its 
borrowers to upgrade their plant and facilities for digital switching, 
fiber optic cabling, emergency 911, and other enhanced features such as 
ISDN, SS7, and CLASS. Due to the dependability of the RUS program, 
borrowers provide their rural subscribers with cutting edge services.
    RUS telecommunications lending also performs a pivotal function of 
stimulating substantial private investment. In fact, RUS borrowers 
invest in telecommunications plant at a rate of $4.80 for every RUS 
dollar spent.
    In addition, the RUS telecommunications program boasts a proud 
financial record probably unprecedented for federal loan programs. To 
date, the program has never experienced a borrower-related default in 
its history. At the end of 1997, $4.5 billion in principal and over $5 
billion in interest had been paid by RUS borrowers. For nearly 49 
years, this successful public/private partnership has worked.
    In 1993, this partnership agreed to a $31 million cut in the name 
of debt reduction, and it agreed to a twelve year freeze in program 
loan levels while other programs grew by at least the rate of 
inflation. This partnership is committed to providing service to areas 
long neglected by others. Ultimately, this partnership will foster the 
rural information network of the 21st century.
Specific Recommendations for the Subcommittee's Consideration
            RUS Telecommunications Loan Program
    Increasing demands for expanded telecommunications services and 
infrastructure upgrades suggests that the level of need continues. 
Congressional mandates as a result of the Rural Electrification 
Restructuring Act (RELRA) of 1993 (Public Law 103-129) have placed 
additional obligations on RUS borrowers to upgrade their technology in 
order to maintain their loan eligibility. To address the persisting 
need, WRTA recommends that the Committee consider the following RUS 
Telecommunications Program loan levels for fiscal year 2000:

5 percent Hardship Loans................................     $75,000,000
Treasury-cost Loans.....................................     300,000,000
FFB Loan Guarantees.....................................     120,000,000
Rural Telephone Bank Loans..............................     175,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     670,000,000

    These loan levels are the same as the current fiscal year's funding 
provided by Congress and represent a genuine commitment to rural 
telecommunications.
            Removal of Interest Rate Ceiling on Treasury-cost Loans
    WRTA supports language removing the 7 percent interest rate cap on 
the program's Treasury-cost loans. This provision was originally 
included in the Agriculture Appropriations Act for fiscal year 1996 and 
continued for the current fiscal year. The inclusion of this provision 
for fiscal year 2000 will prevent a potential disruption of the program 
in the case where interest rates exceed 7 percent and insufficient 
subsidy cannot support authorized loan levels. Stated simply, it is a 
continuation of current policy, and it promotes the viability of the 
program at zero cost.
            Rural Telephone Bank (RTB) Issues
    During the course of fiscal year 1996, the Rural Telephone Bank 
began the statutory retirement of class A, government-owned stock. WRTA 
supports the restriction on accelerating the privatization process as 
conceived beginning in fiscal year 1996 of no more than 5 percent of 
total class A stock retired in one year. We believe that a continuation 
of this policy best addresses the orderly and systematic privatization 
of the RTB. WRTA also urges the Committee to continue the prohibition 
against the transfer of bank funds to the general fund of the Treasury 
along with the requirement that the bank receive interest on those 
funds. The private B and C stockholders of the RTB have an interest in 
the assets of the bank and the protection of all funds.
    For these reasons, WRTA is also opposed to the proposal contained 
in the President's budget that the costs of RTB administration and loan 
subsidy be funded by a transfer from the unobligated balances of the 
bank's liquidating account rather than by appropriations consistent 
with the federal credit reform act. WRTA believes that this proposal 
would impinge upon the ownership interests of the bank's stockholders.
    In addition, we believe that funding the administrative costs of 
the bank through a transfer of unobligated balances of the bank's 
liquidating account rather than through appropriation is contrary to 
the RTB enabling act (Public Law 92-12). Budget language suggests that 
these recommendations would not result in budgetary savings, and no 
justification for this proposal is contained in the budget. 
Furthermore, this proposal would require new authorizing legislation 
prior to an appropriation.
            Distance Learning and Telemedicine (DLT) Loans and Grants
    The RUS Distance Learning and Telemedicine (DLT) program has proven 
to be a remarkable tool for promoting rural development. The DLT loan 
and grant program administered by the RUS significant promise for the 
deployment of modern technology for scores of our rural communities. 
WRTA supports the President's request for $200 million in loans 
delivered at the government's cost-of-money and $20 million in grants 
for DLT purposes. We believe that the proposed level adequately 
responds to the overwhelming demand for DLT resources since the 
implementation of the program by the RUS in 1993.
                               conclusion
    Access to advanced information services is a critical condition for 
future rural economic and social development. The RUS 
telecommunications program has proven to be an indispensable tool for 
rural America, and it continues to improve the nature of rural life in 
our nation, particularly in our isolated Western communities. Thank 
you.
                                 ______
                                 
               Prepared Statement of the State of Wyoming
    This testimony supports fiscal year 2000 expenditures for the 
Department of Agriculture's Environmental Quality Incentives Program 
(EQIP) in the amount of $300,000,000 and requests that $12,000,000 be 
designated for the Colorado River Salinity Control Program.
    This testimony supports fiscal year 2000 appropriations for the 
Department of Agriculture's Environmental Quality Incentives Program 
(EQIP) to carry out Colorado River salinity control activities. 
Testimony was recently submitted by the Colorado River Basin Salinity 
Control Forum (Forum), a seven-state organization created by the 
Governors of the Colorado River Basin States, by the Forum's Executive 
Director, Jack Barnett. The State of Wyoming, a member state of the 
Forum, concurs in the Forum=s testimony.
    Wyoming is represented on both the Colorado River Basin Salinity 
Control Forum and the Colorado River Basin Salinity Control Advisory 
Council. The 1974 Colorado River Basin Salinity Control Act (Public Law 
93-320) created the Advisory Council. Like the Forum, the Advisory 
Council is composed of gubernatorial representatives of the seven 
Colorado River Basin states and serves as a liaison between the seven 
States and the Secretaries of the Interior and Agriculture and the 
Administrator of the Environmental Protection Agency (EPA). It advises 
these Federal officials and the involved agencies on the progress of 
efforts to control the salinity of the Colorado River and annually 
makes funding recommendations, including the amount believed necessary 
to be expended by the USDA for its on-farm Colorado River Salinity 
Control (CRSC) Program. The Forum's testimony is in accordance with the 
Advisory Council's written recommendations.
    The Plan of Implementation and the numeric water quality criteria 
set for three Lower Colorado River stations constitute the State-
adopted, EPA-approved, water quality standards for salinity the 
Colorado River. Jointly developed and revised each three years by the 
States and involved Federal agencies, the Plan of Implementation is 
being carried out to ensure continuing compliance with the numeric 
water quality criteria for salinity.
    During its most recent October 1998 meeting, the Advisory Council 
recommended that at least $12,000,000 be expended by the Department of 
Agriculture for cost-sharing to implement salinity reduction practices 
(funds that are matched with individual contractor's cost-share funds) 
in fiscal year 2000, plus sufficient funds for administration, 
technical information and education, to assure that the Program's 
progress of removing salt and preventing additional salt loading into 
the Colorado River system stays on the schedule set forth within the 
Plan of Implementation. Should a lesser funding level be provided for 
this important basin-wide water quality program, the progress (as 
measured in tons of salt prevented from entering the Colorado River 
system) achieved by the USDA component of the multi-agency, state and 
federal Colorado River Basin Salinity Control Program will fall far 
short of meeting the rate of salinity control determined to be 
determined necessary to assure compliance with the basin-wide standards 
for salinity in the Colorado River. Failure to maintain the standards' 
numeric criteria could result in the imposition of state-line water 
quality standards (as opposed to the successful basin-wide approach 
that has been in place since 1975) and impair the Colorado River Basin 
States' ability to develop their Compact-apportioned water supplies. 
The present basin-wide salinity control program and its funding 
arrangements appropriately reflect that the primary beneficiaries of 
the basin-wide salinity control program are in the Lower Basin while 
the most cost-effective opportunities to reduce salt loading are 
upstream in the Upper Basin. Further, it is unmistakable that funding 
shortfalls will result in significantly higher costs to implement the 
same level of salinity control through the CRSC Program in future 
years.
    The Federal Agriculture Improvement and Reform Act of 1996 (Public 
Law 104-127) provided for the CRSC Program to continue in the future--
as a component part of the Environmental Quality Incentives Program 
(EQIP). We view the inclusion of the Salinity Control Program in EQIP 
as a direct recognition on the part of Congress of the Federal 
commitment to maintenance of the water quality standards for salinity 
in the Colorado River. The Secretary of Agriculture has a vital role in 
meeting that commitment. We urge the Subcommittee to remind the 
Secretary of Agriculture of his obligations under that Federal 
commitment as he makes decisions about national conservation priority 
areas and priority resource concerns. The intention of Public Law 104-
127 is that the nation's agricultural programs be ``locally led and 
driven'' and we agree with that approach. Since the enactment of that 
law, however, the Salinity Control Program has not been funded at a 
level adequate to ensure that the water quality standards for salinity 
in the Colorado River can be maintained at or below the numeric 
criteria levels specified in the standard.
    The Colorado River Basin States have urged the U.S. Department of 
Agriculture to designate the Colorado River Salinity Control Program as 
a national conservation priority area as provided for in the USDA's 
promulgated regulations for the EQIP. Although numerous requests have 
been made for this designation, the response has been that there is not 
adequate EQIP funding. An authorization for EQIP funding in the amount 
of an additional $100,000,000 in fiscal year 2000 above the 
$200,000,000-level minimum specified in Public Law 104-127 is both 
appropriate and needed.
    I accordingly request that this committee support the borrowing of 
$300,000,000 from the Commodity Credit Corporation (CCC) in fiscal year 
2000 for the EQIP Program, and that the Congress advise the 
Administration to designate $12,000,000 of the EQIP funding for the 
Colorado River Basin Salinity Control Program. I thank you for the 
opportunity to submit this testimony and would request, in addition to 
your consideration of its contents, that you make it a part of the 
formal hearing record concerning fiscal year 2000 appropriations for 
the Department of Agriculture. In accordance with the Subcommittee's 
direction, I have submitted five copies of this statement.
                                 ______
                                 
  Prepared Statement of the Yukon River Drainage Fisheries Association
    Requesting $1,000,000 to support marketing of Yukon River salmon to 
compete against foreign production of farmed and hatchery salmon.
                                abstract
    The Yukon River Drainage Fisheries Association (YRDFA) seeks 
$1,000,000 in funding for development, marketing and promotion of Yukon 
River salmon products to compete against foreign production of farmed 
and hatchery salmon. Funds would be utilized by the Association over a 
multi-year period to market and promote Yukon River chinook, chum and 
coho salmon as well as value-added products and caviar. This funding 
would enable Yukon River salmon products to regain foreign and domestic 
market share lost to farmed and hatchery salmon produced and subsidized 
by such countries as Norway, Chile, Japan, Canada, and the U.K. Funds 
could be authorized through the Agricultural Marketing Service or the 
Trade Adjustment Assistance Act.
                              introduction
    The Yukon River Drainage Fisheries Association was formed in 
December 1990 and unites diverse groups of commercial, subsistence and 
sport users of salmon amongst the 42 communities along the river and 
its tributaries in Alaska. The YRDFA has a 16 member Board of Directors 
with seats apportioned amongst the various areas of the drainage. The 
Board operates on a consensus basis and works to craft workable 
cooperative solutions on a variety of regulatory, management and 
allocation issues.
    The YRDFA'S YUKON RIVER SALMON Marketing Program began in January 
1996 and has been funded through a variety of small grants (less than 
$40K each) administered by agencies of the State of Alaska. These 
include the Department of Community & Regional Affairs, the Department 
of Commerce & Economic Development and the Alaska Science & Technology 
Foundation. From its beginning through fiscal year 1999, YRDFA will 
have received only $121,534 over these last four years for its 
marketing program.
    With these minimal funds YRDFA designed and implemented the basics 
of marketing program. Just as YRDFA unites the diverse commercial, 
subsistence and sport fishermen of the Yukon, its YUKON RIVER SALMON 
Marketing Program unifies all Yukon processors and all Yukon salmon 
product forms under one umbrella organization. YRDFA has made 
significant progress in developing name recognition for Yukon River 
salmon products and in developing market niches that demand Yukon River 
salmon. Specifically, YRDFA has: generated significant market demand 
amongst Seattle-area white tablecloth restaurants for Yukon River king 
salmon; generated market demand for Yukon River chum salmon in Pacific 
Northwest retail market; increased public and media familiarity with 
Yukon River salmon and its key attributes; high oil content and 
excellent meat color.
    Unfortunately, neither YRDFA nor Yukon River processors have enough 
marketing funds to compete against the flood of foreign farmed and 
hatchery salmon in both the domestic and foreign marketplace. Major 
market share has already been lost especially in Europe, Japan and in 
the United States.
  impacts of foreign production of farmed and hatchery salmon on u.s. 
             harvests and production of yukon river salmon
Foreign farmed salmon
    As Congress may be aware, the salmon market has changed 
dramatically over the last decade. Prior to 1990, Alaska produced the 
bulk of salmon harvested throughout the world and the farmed salmon 
industry was only just beginning. In just a few short years, however, 
farmed salmon began to dominate not only in terms of total production 
but also in manufacturing high-quality salmon products such as boneless 
fillets and portions. By 1997, farmed salmon had climbed to more than 
50 percent of total world salmon production.
    Major farmed salmon producers include Norway, Chile, Canada and the 
United Kingdom. In contrast to wild salmon which is harvested and 
produced by thousands of individual fishermen and processors acting as 
small businesses, farmed salmon is produced by vertically-integrated 
conglomerates that produce, harvest and process the salmon into final 
consumer ready product forms. In many cases, these farmed salmon 
producers are also supported by generous government subsidies, both 
direct and indirect.
    The specific effects of this boom in foreign farmed salmon 
production on harvests and sales of Yukon River salmon products are as 
follows:
  --complete displacement of frozen Yukon salmon sales to European 
        smoked salmon producers. These smokers used to buy numerous 
        40,000-lb. van loads of frozen Yukon salmon, particularly chum 
        salmon but now they buy fresh lots of farmed salmon on a weekly 
        basis especially from Norway and the U.K.
  --substantial displacement of frozen Yukon chum and coho salmon sales 
        to Japan. Traditionally, Japan was the main importer of Yukon 
        River salmon. Indeed, Japan continues to purchase most of the 
        Yukon king salmon harvest quota. However, due to imports of 
        Norwegian and Chilean farmed salmon, Japan no longer purchases 
        any Yukon summer chum salmon and buys only small lots of fall 
        chum salmon.
  --substantial displacement of fresh and frozen Yukon salmon sales to 
        U.S. domestic distributor, retail and smoker operations, 
        particularly on the U.S. east coast. Although retail grocery 
        chains still purchase small lots of fresh Yukon chum salmon, 
        they no longer purchase hardly any frozen Yukon salmon and 
        their fresh purchases are much smaller than they were in the 
        1980s. Now these retailers carry fresh, farmed salmon year 
        round and smoked operations, particularly on the U.S. east 
        coast, have switched to farmed salmon almost exclusively.
Foreign hatchery salmon
    Although the growth of foreign hatchery production is not as 
dramatic as that of farmed salmon, the impacts on Yukon River salmon 
fisheries have been almost as devastating. Since its citizens consume 
large amounts of salmon and salmon roe Japan has always had a large 
hatchery salmon program and from the early 1970s through 1982 annual 
chum salmon returns (catch + hatchery broodstock for escapement) ranged 
from 10 million to 30 million fish. However, in the last two decades 
Japan has more than doubled its production with harvests in 1988 
reaching 51 million chum salmon, reaching 69 million fish in 1994, 78 
million fish in 1995, 87 million fish in 1996 and 85 million fish in 
1997. Production of chum salmon in government-supported hatcheries in 
British Columbia has also grown dramatically.
    Due to this high production, particularly in the 1990s Japan now 
buys few Yukon chum salmon even though as recently as the late 1980s it 
would buy in excess of 3 million pounds annually. In the United States 
in recent years processors have been reluctant to buy and freeze any 
Yukon chum salmon, in part due to the glut of hatchery chum salmon from 
B.C.
    The specific effects of this steady expansion in foreign hatchery 
salmon production on harvests and sales of Yukon River salmon products 
are as follows:
  --substantial displacement of frozen Yukon chum salmon sales to 
        Japan. As described above, farmed salmon from Norway and Chile 
        have helped to displace Yukon salmon from the Japanese market. 
        Japan's own massive hatchery chum salmon production has since 
        1990 completely glutted even Japan's own large salmon market 
        and now Yukon summer chum are now no longer imported at all.
  --new competition from imports of Japanese hatchery chum salmon and 
        British Columbia hatchery chum salmon. In 1997 Japan's 
        production of hatchery chum salmon was so large that Japanese 
        companies began exporting their chum salmon direct to the U.S. 
        at extremely low wholesale prices, in some cases below $0.70/
        lb., FOB-Seattle compared to Yukon chum at $1.10/lb., FOB-
        Seattle. In 1998, due to booming chum production in B.C., these 
        chums were being sold in Seattle at only $0.20/lb. compared to 
        Yukon chums at $1.25/lb.
  --substantial displacement of Yukon chum salmon roe (caviar) to 
        Japan. Since all of Japan's chum salmon production is of 
        hatchery origin, many of the fish are harvested in terminal 
        bays. This means that the fish are sexually mature and the roe 
        is harvested for processing into ikura caviar. In the middle 
        and upper Yukon, harvests of summer chum and fall chum have 
        dwindled as the wholesale price for chum salmon roe has fallen 
        due to the dramatic growth in Japan's hatchery chum salmon 
        returns. Ex-vessel prices to Yukon fishermen have fallen from a 
        normal price (ca. 1990) of $4/lb. down to $1/lb. in 1998. 
        Production of British Columbia chums also act to drag down the 
        wholesale price of salmon roe.
  federal support for yukon river salmon marketing can help the u.s. 
               regain domestic and foreign market share.
    It is clear that foreign competition has dramatically hurt harvests 
and sales of Yukon River salmon. This competition has caused severe 
economic losses to the 940 commercial salmon permit holders and the 12-
15 companies that buy and process salmon annually on the Yukon. Annual 
incomes have declined steeply and in some fishing areas processors have 
not bought any salmon from the fishermen due to the low wholesale 
prices caused by the glut of foreign salmon.
    However, as the results of YRDFA's own marketing efforts in the 
Pacific Northwest show, it is very possible for Yukon River salmon to 
develop additional market niches in areas such as Europe and in select 
high-end markets in the United States.
European market potential
    After many years of market domination by Norwegian and U.K. farmed 
salmon, European salmon consumers are beginning to look for something 
different. Concerns over the ecological effects of farmed salmon 
production as well general consumer trends towards more ``natural'' and 
``organic'' foods have led to renewed interest in wild salmon. German 
consumers in particular are fascinated with things Alaskan as the high 
percentage of German tourists visiting Alaska indicate.
    Concentrated efforts in the high-end, gourmet market could create a 
market niche for fresh and flash-frozen Yukon River salmon fillets, 
smoked Yukon River salmon and Yukon River salmon caviar. Marketing and 
promotional efforts would emphasize the health and nutrition benefits 
of Yukon River salmon which is all-natural and organic wild salmon 
compared to farmed salmon which live in pens, are fed pellets and are 
occasionally given antibiotics.
Japanese market potential
    Japanese consumers have a long familiarity with Yukon River salmon. 
Yukon River king salmon already have a unique market niche in Japan due 
to their high oil content and Japanese corporations continue to buy the 
majority of the annual Yukon king salmon harvest. However, as described 
above, imports of Yukon chum salmon and Yukon caviar have slipped due 
to the glut of hatchery chum salmon on the market. YRDFA's promotional 
efforts will therefore concentrate on developing a market niche for 
these underutilized chum by building on the customer loyalty already 
shown for Yukon king salmon.
Regaining Yukon salmon market share in the domestic marketplace
    As YRDFA's success in the Seattle market shows, once customers are 
educated as to the unique attributes of Yukon River salmon they are 
willing to pay the higher costs rather than purchase a generic, farmed 
salmon. Although U.S. retail and foodservice operations have come to 
rely on steady deliveries of farmed salmon, they recognize that they 
need wild salmon to generate customer foottraffic and market excitement 
and hence overall increased sales of salmon and non-salmon items. YRDFA 
will seek to expand its domestic marketing outside the Pacific 
Northwest to high-end restaurant and gourmet shops that are seeking to 
diversify their menu and product offerings.

Budget Estimate (October 2000-September 2003):
    Marketing Personnel & Office Expenses.....................  $300,000
    Travel & Tradeshows.......................................   150,000
    Advertising & Educational Materials.......................   100,000
    Quality Improvements & Inspections........................   210,000
    Customer Development & Promotions.........................   200,000
    Legal counsel & Trademarking..............................    40,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 1,000,000

    If this appropriation is funded, YRDFA's intent would be to 
implement a four-year program to regain market share lost to foreign 
competition. In addition to tradeshows, advertising and promotional 
expenses to secure and support customer use of Yukon River salmon, 
YRDFA will also institute a rigorous quality assurance program amongst 
Yukon River salmon fishermen and processors to ensure that the customer 
gets only top-quality salmon product.
    We hope that the Congress can fund this request. The livelihoods of 
1,000 Yukon River commercial fishermen and crew and their families are 
in the balance, and if we cannot compete against this foreign salmon 
production our industry will die.
    Thank you for this opportunity to submit written testimony.


       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page
Ad Hoc Coalition, prepared statement.............................  1223
Altenkirch, Dr. Robert A., Vice President for Research, 
  Mississippi State University, prepared statement...............  1254
American:
    Farm Bureau Federation, prepared statement...................  1225
    Honey Producers Association, Inc., prepared statement........  1228
    Indian Higher Education Consortium, prepared statement.......  1229
    Seed Trade Association, prepared statement...................  1232
    Sheep Industry Association, Inc., prepared statement.........  1235
    Society for Nutritional Sciences, prepared statement.........  1238
Amontree, Tom, Director of Communications, Office of 
  Communications, Department of Agriculture, prepared statement..   739
Anand, Dr. Rajen, Executive Director, Center for Nutrition Policy 
  and Promotion, Department of Agriculture.......................   553
Armstrong, Robert E., Executive Director, Alternative 
  Agricultural Research and Commercialization Corporation 
  (AARCC), Department of Agriculture, prepared statement.........   707
Association of Research Directors 1890 Land-Grant Universities, 
  prepared statement.............................................  1242
ASTA Corn & Sorghum Basic Research Committee, prepared statement.  1244

Beyer, Wally, Administrator, Rural Utilities Service, Department 
  of Agriculture, prepared statement.............................   779
Billy, Tom, Administrator, Food Safety and Inspection Service, 
  Office of the Under Secretary for Food Safety, Department of 
  Agriculture....................................................   517
    Questions submitted to.......................................   460
Bond, Hon. Christopher S., U.S. Senator from Missouri............     3
    Questions submitted to:
        Food and Drug Administration.............................   668
        Under Secretary for Farm and Foreign Agricultural 
          Services...............................................   282
Burns, Hon. Conrad, U.S. Senator from Montana....................     4
    Prepared statements.....................................5, 139, 316
    Questions submitted to:
        Agricultural Marketing Service...........................   852
        Animal and Plant Health Inspection Service...............   848
        Department of Agriculture................................   832
        Food and Drug Administration.............................   673
        Food Safety and Inspection Service.......................   463
        Grain Inspection, Packers, and Stockyard Administration..   855
        National Agricultural Statistics Service.................   821
        Research Activities......................................   979
        Under Secretary for Farm and Foreign Agricultural 
          Services...............................................   284
        Under Secretary for Food Safety..........................   455
Byrd, Hon. Robert C., U.S. Senator from West Virginia, questions 
  submitted to:
    Department of Agriculture....................................   599
    Food and Drug Administration.................................   704
    Under Secretary for Farm and Foreign Agricultural Services...   286
Byrd, Robert J., Deputy Commissioner for Management and Systems, 
  Chief Financial Officer, Food and Drug Administration, 
  Department of Health and Human Services........................   617

California Industry and Government Coalition on PM-10/PM-2.5, 
  prepared statement.............................................  1248
Catfish Farmers of America, prepared statement...................  1371
Chambers, Samuel, Administrator for the Food and Nutrition 
  Service, Department of Agriculture.............................   553
Coalition for Affordable Pharmaceuticals, prepared statement.....  1251
Coalition of Agricultural Mediation Programs, prepared statement.  1253
Coalition to Promote U.S. Agricultural Exports, prepared 
  statement......................................................  1255
Cochran, Hon. Thad, U.S. Senator from Mississippi, questions 
  submitted to:
    Agricultural Marketing Service...............................   848
    Agricultural Research Service................................   860
    Animal and Plant Health Inspection Service...................   837
    Department of Agriculture.............................573, 827, 855
    Departmental Administration..................................   784
    Economic Research Service....................................   821
    Farm Credit Administration...................................   980
    Federal Administration and Special Research Grants...........   991
    Food and Drug Administration...............................333, 642
    Grain Inspection, Packers, and Stockyard Administration......   852
    National Agricultural Statistics Service.....................   820
    Office of Chief Information Officer..........................   789
    Office of the Secretary......................................    48
    Research Activities..........................................   947
    Research, Education and Economics............................   983
    Questions on Government Performance and Results Act:
        Agricultural Marketing Service...........................  1182
        Agricultural Research Service............................  1183
        Alternative Agricultural Research and Commercialization 
          Corporation............................................  1181
        Animal and Plant Health Inspection Service...............  1185
        Cooperative State Research, Education, and Extension 
          Service................................................  1187
        Departmental Administration..............................  1189
        Economic Research Service................................  1190
        Farm Service Agency......................................  1194
        Food Safety and Inspection Service.......................  1197
        Foreign Agricultural Service.............................  1192
        Grain Inspection, Packers and Stockyards Administration..  1200
        National Agricultural Statistics Service.................  1201
        National Appeals Division................................  1203
        Natural Resources Conservation Service...................  1204
        Office of Budget and Program Analysis....................  1207
        Office of Chief Information Officer......................  1213
        Office of Communications.................................  1208
        Office of the Chief Economist............................  1210
        Office of the Chief Financial Officer....................  1211
        Office of the General Counsel............................  1214
        Office of the Inspector General..........................  1215
        Risk Management Agency...................................  1219
        Rural Development........................................  1217
Collins, Keith, Chief Economist, Department of Agriculture.......1, 123
    Prepared statements........................................128, 719
    Statement of.................................................   124
Colorado River Basin Salinity Control Forum, prepared statement..  1257
Colorado River Board of California, prepared statement...........  1259
Columbia University, prepared statement..........................  1262
Cooper, Norman G., Director, National Appeals Division, 
  Department of Agriculture, prepared statement..................   718
Cosmetic, Toiletry, and Fragrance Association, prepared statement  1268
Council for Agricultural Research, Extension, and Teaching, 
  prepared statement.............................................  1269
Council for Responsible Nutrition, prepared statement............  1271
Council on Food, Agricultural and Resource Economics (CFARE) and 
  the Consortium of Social Science Associations (COSSA), prepared 
  statement......................................................  1264

Dewhurst, Stephen B., Budget Officer, Office of the Secretary, 
  Department of Agriculture......................................     1
Dorgan, Hon. Byron L., U.S. Senator from North Dakota, questions 
  submitted to:
    Department of Agriculture....................................   591
    Food and Drug Administration.................................   686
    Office of the Secretary......................................   114
    Under Secretary for Food Safety..............................   484
Durbin, Hon. Richard J., U.S. Senator from Illinois..............     7
    Prepared statement...........................................   534
    Questions submitted to:
        Food and Drug Administration.............................   702
        Office of the Secretary..................................   119
        Under Secretary for Food Safety..........................   495

Easter Seals, prepared statement.................................  1274

Farm*A*Syst/Home*A*Syst, prepared statement......................  1276
Federation of American Societies for Experimental Biology 
  (FASEB), prepared statement....................................  1280
Feinstein, Hon. Diane, U.S. Senator from California..............     9
    Prepared statement...........................................   140
    Questions submitted to:
        Department of Agriculture................................   604
        Food and Drug Administration.............................   695
        Office of the Secretary..................................   117
        Under Secretary for Food Safety..........................   492
Figueroa, Dr. Enrique, Administrator, Agricultural Marketing 
  Service, Office of the Under Secretary for Food Safety, 
  Department of Agriculture......................................   517
Florida State University, prepared statement.....................  1283
Friedman, Michael A., M.D., Deputy Commissioner for Operations, 
  Food and Drug Administration, Department of Health and Human 
  Services.......................................................   617
Friends of Agricultural Research--Beltsville, prepared statement.  1285
Friends of the National Arboretum, prepared statement............  1288

Glickman, Dan, Secretary, Office of the Secretary, Department of 
  Agriculture.................................................... 1, 10
    Letter from..................................................   496
    Prepared statement...........................................    17
Gonzalez, Dr. I. Miley, Under Secretary, Office of the Under 
  Secretary for Research, Education, and Economics, Department of 
  Agriculture, prepared statement................................   760
Gorton, Hon. Slade, U.S. Senator from Washington.................   138
    Questions submitted to Food and Drug Administration..........   447
Gray, Rosalind D., Director, Office of Civil Rights, Department 
  of Agriculture, prepared statement.............................   737
Grocery Manufacturers of America, prepared statement.............  1289

Harkin, Hon. Tom. U.S. Senator from Iowa:
    Prepared statement...........................................   538
    Questions submitted to:
        Food and Drug Administration.............................   684
        Under Secretary for Food Safety..........................   478
Health Industry Manufacturers Association, prepared statement....  1290
Hefferan, Dr. Colien, Acting Administrator, Cooperative State 
  Research, Education, and Extension Service, Department of 
  Agriculture, prepared statement................................   709
Henney, Dr. Jane, Commissioner, Food and Drug Administration, 
  Department of Health and Human Services......................325, 617
    Memorandum from..............................................   631
    Prepared statements........................................327, 620
Humane Society of the United States, prepared statement..........  1294

Illinois Institute of Technology, prepared statement.............  1295
Illinois Soybean Association, prepared statement.................  1297
Illinois-Missouri Alliance for Agricultural Biotechnology, 
  prepared state- 
  ment...........................................................  1303
International Association of Fish and Wildlife Agencies, prepared 
  statement......................................................  1306
Iowa Senate Agriculture Committee, letter from...................  1312

Joslin Diabetes Center, prepared statement.......................  1312

Kaplan, Dennis, Deputy Director of Budget, Legislative and 
  Regulatory Systems, Office of Budget and Program Analysis, 
  Department of Agriculture...............................123, 517, 553
Kennedy, Dr. Eileen, Deputy Under Secretary for Research, 
  Education and Economics, Office of the Under Secretary for Food 
  Safety, Department of Agriculture..............................   517
Kohl, Hon. Herb, U.S. Senator from Wisconsin:
    Prepared statements........................................136, 554
    Questions submitted to:
        Department of Agriculture................................   607
        Under Secretary for Food Safety..........................   472
        Food and Drug Administration.............................   679
        Office of the Secretary..................................   100
        Under Secretary for Farm and foreign Agricultural 
          Services...............................................   291
    Statements of................................................2, 316
Koplan, Jeffrey P., M.D., Director, Centers for Disease Control 
  and Prevention, Department of Health and Human Services......315, 318
    Prepared statement...........................................   320
Kruse, Charles E., letter from...................................  1316
Kyle, Hon. Jon, U.S. Senator from Arizona, questions submitted to 
  the Department of Agriculture..................................   311

Lyons, James R., Under Secretary for Natural Resources and 
  Environment, prepared statement................................   152

McConnell, Hon. Mitch, U.S. Senator from Kentucky, questions 
  submitted to:
    Centers for Disease Control and Prevention...................   451
    Food and Drug Administration.................................   672
Metropolitan Water District of Southern California, prepared 
  statement......................................................  1313

National Association of:
    Conservation Districts, prepared statement...................  1317
    Home Builders, prepared statement............................  1320
    Professional Forestry Schools and Colleges, prepared 
      statement..................................................  1322
    State Universities and Land-Grant Colleges, prepared 
      statements.............................................1324, 1328
    University Fisheries and Wildlife Programs, prepared 
      statement..................................................  1330
National:
    Center for Resource Innovations, prepared statement..........  1332
    Commodity Supplemental Food Program (CSFP), prepared 
      statement..................................................  1335
    Conservation Buffer Council, prepared statement..............  1338
    Cooperative Business Association, prepared statement.........  1338
    Corn Growers Association, prepared statement.................  1340
    Cotton Council of America, prepared statement................  1343
    Council of Farmer Cooperatives, prepared statement...........  1344
    Food Processors Association, prepared statement..............  1347
    Potato Council, prepared statement...........................  1349
    Rural Telecom Association, prepared statement................  1350
    Telephone Cooperative Association Regarding, prepared 
      statement..................................................  1354
    Utility Contractors Association, prepared statement..........  1357
    Watershed Coalition, prepared statement......................  1359
Nature Conservancy, prepared statement...........................  1362

Offutt, Susan E., Administrator, Economic Research Service, 
  Department of Agriculture, prepared statement..................   714
Organization for the Promotion and Advancement of Small 
  Telecommunications Companies, prepared statement...............  1363

Pharmaceutical Research and Manufacturers of America, prepared 
  state- 
  ment...........................................................  1366

Rawls, Charles R., General Counsel, Office of the General 
  Counsel, prepared statement....................................   740
Red River Valley Association, prepared statement.................  1368
Reed, Anne F. Thomson, Chief Information Officer, Office of the 
  Chief Information Officer, Department of Agriculture, prepared 
  statement......................................................   728
Reed, Pearlie S., Chief, Natural Resources Conservation Service, 
  prepared statement of..........................................   151
Rominger, Richard, Deputy Secretary, Office of the Secretary, 
  Department of Agriculture......................................     1
Schumacher, August, Jr., Under Secretary for Farm and Foreign 
  Agricultural Services, Department of Agriculture...............
    Letters from...............................................123, 141
    Prepared statement...........................................   145
Second Harvest National Network of Food Banks, prepared statement  1372
Seminole Tribe of Florida, prepared statement....................  1375
Shadburn, Jan E., Administrator, Rural Housing Service, prepared 
  statement......................................................   774
Society for Animal Protective Legislation, prepared statement....  1377
Southern Legislative Conference (SLC) Agriculture and Rural 
  Development Committee and of the SLC Fire Ant Task Force, 
  prepared statement.............................................  1381
State of Illinois, prepared statement............................  1299
State of Wyoming, prepared statement.............................  1406
Suffolk County, NY, prepared statement...........................  1380
Texas A&M University System, prepared statement..................  1383
Thompson, Jill Long, Under Secretary, Office of the Secretary for 
  Rural Economics and Community Development, Department of 
  Agriculture, prepared statement................................   768
Thompson, Sally, Acting Assistant Secretary, Administration, 
  Departmental Administration, Department of Agriculture, 
  prepared statement.............................................   712
Thompson, Sally, Chief Financial Officer, Office of the Chief 
  Financial Officer, Department of Agriculture, prepared 
  statement......................................................   725
U.S. Agricultural Export Development Council, prepared statement.  1400
U.S. Apple Association, prepared statement.......................  1386
U.S. Marine Shrimp Farming Program, prepared statement...........  1394
United States Telephone Association, prepared statement..........  1387
University of Illinois, prepared statement.......................  1390
University of Miami, prepared statement..........................  1393
University of Southern Mississippi, prepared statement...........  1395
Upper Mississippi River Basin Association, prepared statement....  1398
USA Rice Federation, prepared statement..........................  1399
USDA UVB Radiation Monitoring Program, Natural Resource Ecology 
  Laboratory, Colorado State University, prepared statement......  1260

Viadero, Roger C., Inspector General, Office of Inspector 
  General, Department of Agriculture, prepared statement.........   750

Watkins, Dayton J., Administrator, Rural Business-Cooperative 
  Service, prepared statement....................................   766
Watkins, Shirley R., Under Secretary for Food, Nutrition and 
  Consumer Services, Department of Agriculture...................   553
    Prepared statement...........................................   558
Western Rural Telephone Association, prepared statement..........  1404
Williams, Dennis P., Deputy Assistant Secretary for Budget, 
  Department of Health and Human Services........................   617
Woteki, Catherine E., Under Secretary for Food Safety, Office of 
  the Under Secretary for Food Safety, Department of Agriculture.   517
    Prepared statement...........................................   522
    Questions submitted to Food and Drug Administration..........   455

Yukon River Drainage Fisheries Association, prepared statement...  1408
                                                                    719


                             SUBJECT INDEX

                              ----------                              

                       DEPARTMENT OF AGRICULTURE

                                                                   Page
Alternative Agricultural Research and Commercialization 
  Corporation....................................................   833
Appalachia, small family farmers in..............................   600
Business and industry loans......................................   829
Child and Adult Care Food Program................................   604
    Welfare changes..............................................   608
Child Nutrition Program...................................556, 576, 592
Child nutrition--soda in schools.................................   607
Children's food guide pyramid....................................   570
Commodity Assistance Program...................................557, 575
Community Food Projects Competitive Grants Program...............   578
Cooperative development grants...................................   829
Cooperative research agreements..................................   830
Early warning systems............................................   828
Elderly feeding..................................................   575
Electric and telecommunication programs..........................   832
Electronic benefit transfer......................................   564
EZ/EC grants.....................................................   832
Fiscal year 2000 request.........................................   561
Food and Nutrition Service:
    Fiscal year:.................................................
        1999 research plan.......................................   582
        2000 budget request......................................   555
Food Banks and the Food Stamp Program............................   566
Food Program:
    Account......................................................   557
    Administration...............................................   579
    Studies and evaluations......................................   581
Food stamp caseload reductions...................................   606
Food Stamp Program...................................555, 564, 573, 591
    Effects of welfare reform....................................   611
    Integrity studies............................................   596
    Restoration for legal immigrants.............................   606
FSP trafficking..................................................   597
Government Performance and Results Act...........................   579
Meals in after school centers....................................   609
Nutrition:
    Assistance Program...........................................   594
    Education and training.......................................   569
    Education and Training Program (NET).......................593, 614
Partnership technical assistance grants..........................   829
Program:
    And financial integrity......................................   596
    Highlights...................................................   559
    Integrity....................................................   562
RCAP unobligated balances........................................   831
Rural:
    Business-Cooperative Service.................................   833
    Economic development grants..................................   832
    Electric and telephone programs..............................   832
    Electrification and telephone programs.......................   828
    Housing......................................................   827
    Housing Service..............................................   833
    Telephone bank...............................................   829
Salaries and expenses............................................   831
School Breakfast Program.........................................   567
    Pilot........................................................   575
School Lunch Program--country-of-origin labeling.................   596
School Lunch/School Breakfast Programs...........................   599
Secretary's farmworker initiative................................   856
Soft drinks......................................................   566
Studies and evaluations..........................................   613
Support Services Bureau..........................................   831
Water and waste..................................................   831
WIC:
    Budget cuts..................................................   572
    Farmers' Market Nutrition Program............................   590
    Immunization.................................................   609
    Program....................................................557, 571
        Integrity studies........................................   598
    Special Supplemental Nutrition Program for...................   607
Working families, promoting the long-term health and productivity 
  of.............................................................   561
Y2K emergency food response......................................   583

               Animal and Plant Health Inspection Service

Agricultural quarantine inspection user fees.....................   844
Animal welfare...................................................   841
APHIS:
    Personnel, safety of.........................................   843
    Y2K systems..................................................   843
Asian long-horned beetle.........................................   844
Biotechnology....................................................   846
Brucellosis...............................................840, 846, 848
Contingency fund.................................................   844
Fruit fly exclusion and detection--Suredye.......................   838
Horse protection.................................................   842
Invasive alien plants............................................   844
Johne's disease..................................................   844
Karnal bunt......................................................   839
Malathion aerial spraying........................................   837
Management and overhead expenses.................................   847
National animal health emergency management system...............   844
National farm animal identification and records project..........   840
National monitoring and residue analysis laboratory..............   843
National poultry improvement program.............................   846
Pink bollworm....................................................   847
Pseudorabies eradication plan, accelerated.......................   839
Sterile fruit fly release program................................   837
Swim with the dolphins...........................................   842
U.S.-Panama Screwworm Commission.................................   839
Wildlife services..............................................840, 848

                     Agricultural Marketing Service

Export funding and producer education............................   852
Fees, summary of by activity.....................................   850
Microbiological Data Program.....................................   850
Organic Certification Program....................................   852
Pesticide Data Program...........................................   848

                     Agricultural Research Service

Aflatoxin........................................................   895
Agricultural Research Service fiscal year 2000 proposed increases   873
Appalachia initiative, pasture-based beef systems for............   906
Appropriations, fiscal year 1999.................................   860
Aquaculture......................................................   891
Budget request, fiscal year 2000.................................   872
Buildings and facilities.........................................   932
Centers of excellence............................................   929
Cotton nematode..................................................   897
Counter-narcotics/anti-bioterrorism research, ARS role in........   884
Environmental initiatives......................................927, 929
Eurasian avian influenza.........................................   909
Food safety......................................................   919
Fruit flies, biology and management of temperate.................   905
Fusarium head blight (wheat/barley scab) research................   906
Genome research..................................................   910
Ginning research.................................................   893
Human nutrition research.........................................   911
Integrated pest management.......................................   915
Lower Mississippi Delta nutrition intervention research 
  initiative.....................................................   893
Management.......................................................   886
Methyl bromide, alternatives to..................................   924
National Agricultural Library....................................   930
National plant germplasm system (NPGS)...........................   900
National sedimentation laboratory................................   909
Pay costs........................................................   883
Postharvest......................................................   924
Potato research..................................................   905
Preharvest.......................................................   923
Red imported fire ant............................................   898
Turkey research..................................................   908

      Cooperative State Research, Education, and Extension Service

Budget highlights, fiscal year 2000..............................   710

                      Departmental Administration

Agriculture buildings and facilities and rental payments.........   713
BRAVO:
    Initiative...................................................   784
    Obligations..................................................   785
Bringing rural America venture opportunities--BRAVO..............   712
Departmental Administration budget request.......................   713
Farmers, outreach for socially disadvantaged.....................   713
Funding and staffing levels for..................................   785
Government ethics................................................   712
Hazardous waste management.....................................714, 788
Operations planning, continuity of...............................   713
Target center....................................................   785
USDA strategic space plan........................................   713
Welfare to work..................................................   712
Workplace conflict management....................................   712

                       Economic Research Service

Budget...........................................................   714
Climate change and variability, national assessment of...........   827
Customers, partners, and stakeholders............................   718
Electric utility deregulation....................................   825
Food:
    Assistance program studies and evaluations...................   821
    Safety.......................................................   824
Mission..........................................................   714
    Area goals, ERS contributions to.............................   715
Office of Energy Policy and New Uses.............................   825
Outlook reports..................................................   827

                       Farm Credit Administration

Competition......................................................   980
Equity-based lending.............................................   980
Government Performance and Results Act...........................   982
Interest rates, competitive......................................   981

           Federal Administration and Special Research Grants

Aflatoxin research, Illinois.....................................   991
AG in the Classroom..............................................  1161
AG-based industrial lubricants research program, Iowa............   992
Agricultural:
    Development in the American Pacific..........................  1144
    Diversification and specialty crops, Hawaii..................   994
    Diversity/Red River, MN and ND...............................   995
    Waste utilization, West Virginia.............................  1145
Agriculture water usage, GA......................................   996
Alliance for Food Protection, NE, GA.............................   997
Alternative crops:
    For arid lands, Texas........................................  1000
    North Dakota.................................................   998
Alternative marine and freshwater species, Mississippi...........  1001
Alternative salmon products, AK..................................  1002
Animal science food safety consortium............................  1002
Animal waste management, Oklahoma................................  1146
Apple fire blight, Michigan and New York.........................  1004
Aquaculture:
    Product and marketing development, West Virginia.............  1006
    Louisiana....................................................  1005
    Research, Stoneville, Mississippi............................  1007
    Virginia.....................................................  1008
Babcock Institute for International Dairy Research and 
  Development....................................................  1009
Beef improvement--Arkansas.......................................  1163
Binational agricultural research and development program.........  1010
Biodiesel research, Missouri.....................................  1012
Brucellosis vaccine, Montana.....................................  1013
Center for:
    Agriculture and Rural Development............................  1147
    For Animal Health and Productivity, Pennsylvania.............  1014
    Innovative Food Technology, Ohio.............................  1015
    North American Studies, Texas................................  1148
    Rural Studies, Vermont.......................................  1016
Chesapeake Bay:
    Aquaculture, Maryland........................................  1018
    Groecology, MD...............................................  1017
Citrus tristeza..................................................  1019
Competitiveness of agriculture products, Washington..............  1020
Contagious equine metritis, Kentucky.............................  1021
Cool season legume research......................................  1022
Cotton research, Texas...........................................  1023
Cranberry and blueberry, Massachusetts...........................  1024
Cranberry-blueberry disease and breeding, New Jersey.............  1023
Critical issues..................................................  1025
Dairy and meat goat research, Prairie View A&M, Texas............  1027
Data information system..........................................  1149
Delta rural revitalization, Mississippi..........................  1027
Delta Teachers Academy...........................................  1164
Designing foods for health, Texas................................  1028
Diabetes detection and prevention, Washington and Hawaii.........  1166
Drought mitigation, Nebraska.....................................  1029
Ecosystems, Alabama..............................................  1030
Environmental:
    Research, New York...........................................  1031
    Risk factors/cancer, New York................................  1033
Expanded wheat pasture, Oklahoma.................................  1034
Expert IPM decision support system...............................  1035
Extension specialist:
    Arkansas (small farm management and marketing education 
      project)...................................................  1167
    Mississippi..................................................  1168
Farm and rural business finance: Illinois and Arkansas...........  1037
Feed barley for rangeland cattle, Montana........................  1039
Floriculture, Hawaii.............................................  1039
Food:
    And Agriculture Policy Institute, Iowa and Missouri..........  1040
    Irradiation, Iowa............................................  1042
    Marketing Policy Center, Connecticut.........................  1043
    Processing Center, Nebraska..................................  1044
    Quality, AK..................................................  1045
    Safety.......................................................  1046
        Alabama..................................................  1047
    Systems Research Group, Wisconsin............................  1048
Forestry research, Arkansas......................................  1049
Fruit and vegetable market analysis, Arizona and Missouri........  1051
Generic commodity promotion, New York............................  1051
Geographic information system....................................  1152
Global:
    Change.......................................................  1052
    Marketing support services, Arkansas.........................  1054
Grain sorghum....................................................  1055
Grass seed cropping systems for sustainable agriculture..........  1056
Gulf coast shrimp aquaculture....................................  1154
Human nutrition:
    Iowa.........................................................  1057
    Louisiana....................................................  1058
    New York.....................................................  1059
Hydroponic tomato production, OH.................................  1061
Illinois-Missouri Alliance for Biotechnology.....................  1061
Improved dairy management practices, Pennsylvania................  1062
Improved fruit practices, Michigan...............................  1063
Income enhancement demonstration, Ohio...........................  1169
Infectious disease research, Colorado............................  1064
Institute for Food Science and Engineering, Arkansas.............  1065
Integrated:
    Cow-calf management--Iowa....................................  1170
    Pest management..............................................  1066
    Production systems, Oklahoma.................................  1067
International agricultural market structures and institutions, 
  Kentucky.......................................................  1068
International Arid Lands Consortium..............................  1069
Iowa Biotechnology Consortium....................................  1070
IR-4 minor crop pest management..................................  1072
Jointed goatgrass................................................  1074
Livestock and dairy policy, New York and Texas...................  1076
Lowbush blueberry research, Maine................................  1077
Maple research, Vermont..........................................  1078
Mariculture, North Carolina......................................  1155
Meadowfoam, Oregon...............................................  1078
Michigan Biotechnology Consortium................................  1079
Midwest Advanced Food Manufacturing Alliance, Nebraska...........  1081
Midwest agricultural products, Iowa..............................  1082
Milk safety, Pennsylvania........................................  1083
Minor use animal drugs...........................................  1084
Mississippi Valley State University..............................  1156
Molluscan shellfish, Oregon......................................  1086
Multi-commodity research, Oregon.................................  1087
Multi-cropping strategies for aquaculture, Hawaii................  1088
National:
    Alternative Fuels Laboratory.................................  1158
    Biological impact assessment program.........................  1089
    Center for Peanut Competitiveness............................  1159
    Education Center for Agricultural Safety.....................  1172
Nematode resistance genetic engineering, New Mexico..............  1091
Nonfood agricultural products program, Nebraska..................  1091
Oil resources from desert plants, New Mexico.....................  1093
Organic waste utilization, New Mexico............................  1093
Pasture & forage research, Utah..................................  1095
Peach tree short life in South Carolina..........................  1095
Pest control alternatives, South Carolina........................  1096
Pest management alternatives.....................................  1099
Pesticide impact assessment program..............................  1097
Phytophthora root rot, New Mexico................................  1100
Pilot technology project, Wisconsin..............................  1173
Plant, drought, and disease resistance gene cataloging...........  1101
PM-10 study, California and Washington...........................  1160
Postharvest rice straw, California...............................  1102
Potato research..................................................  1103
Pre-harvest food safety, Kansas..................................  1105
Precision agriculture:
    Kentucky.....................................................  1104
    Mississippi..................................................  1104
Preservation and processing research, Oklahoma...................  1106
Range policy development, New Mexico.............................  1174
Rangeland ecosystems, NM.........................................  1107
Regional barley gene mapping project.............................  1108
Regionalized implications of farm programs.......................  1109
Research and extension project, basic weather service for........  1168
Rice modeling....................................................  1110
Rural:
    Development:
        Centers..................................................  1111
        Oklahoma.................................................  1175
        Through tourism, New Mexico..............................  1176
    Policies Institute...........................................  1113
    Rehabilitation, Georgia......................................  1177
Russian wheat aphid, Colorado....................................  1114
Seafood harvesting, processing, and marketing, Mississippi.......  1116
Small fruit research.............................................  1117
Southwest Consortium for Plant Genetics and Water Resources......  1118
Soybean cyst nematode, Missouri..................................  1120
STEEP III-water quality in the Pacific Northwest.................  1121
Sustainable:
    Agriculture systems for Nebraska.............................  1123
    Agriculture, Michigan........................................  1122
    And natural resources, Pennsylvania..........................  1124
    Beef supply, MT..............................................  1125
    Pest management for dryland wheat, Montana...................  1126
Swine waste management, North Carolina...........................  1127
Technology transfer projects, Oklahoma and Mississippi...........  1178
Tillage, silviculture, and waste management, Louisiana...........  1128
Tomato wilt virus, Georgia.......................................  1129
Tropical and subtropical research................................  1130
Turkey coronavirus, Indiana......................................  1131
Urban pests, Georgia.............................................  1132
Vidalia onions...................................................  1133
Viticulture Consortium, New York & California....................  1134
Water:
    Conservation, Kansas.........................................  1134
    Quality......................................................  1136
Weed control, North Dakota.......................................  1138
Wetland plants, LA...............................................  1139
Wheat genetics...................................................  1140
Wood:
    Biomass, New York............................................  1180
    Utilization research.........................................  1141
Wool research....................................................  1142

                National Agricultural Statistics Service

Crop insurance programs, data for................................   821
Food safety and pesticide use surveys............................   820
Puerto Rico......................................................   820

                       National Appeals Division

Budget request, fiscal year 2000.................................   719
Mission..........................................................   718

                         Office of Civil Rights

Accomplishments, other specific..................................   738
Budget request...................................................   739
Complaints resolved, most backlog................................   738
Programs and services, assure all have full access to all........   737
Staff reflect the diversity of the community.....................   737
Treat all fairly and equitably with dignity and respect..........   737

                        Office of Communications

Budget request, fiscal year 2000.................................   740

                      Office of Inspector General

Accounting, financial, and information management................   759
Agricultural Marketing Service (AMS).............................   753
Animal and Plant Health Inspection Service (APHIS)...............   753
Audit and investigations activities..............................   753
Cooperative State Research, Education, and Extension Service 
  (CSREES).......................................................   758
Employee integrity...............................................   760
Farm and Foreign Agricultural Services...........................   755
Farm Service Agency (FSA)........................................   755
    Investigations...............................................   757
Food and Nutrition Service (FNS).................................   754
Food, Nutrition, and Consumer Services...........................   754
Introduction and overview........................................   750
Marketing and regulatory programs................................   753
Research, education, and economics...............................   758
Risk Management Agency (RMA).....................................   757
Rural development................................................   757
Rural Housing Service (RHS)......................................   757
    Insurance....................................................   757

                     Office of the Chief Economist

Budget request, fiscal year 2000.................................   725
Immediate Office of the Chief Economist..........................   719
Office of Energy Policy and New Uses--OEPNU......................   723
Office of Risk Assessment and Cost-Benefit Analyses..............   724
World Agricultural Outlook Board--WAOB...........................   721

                 Office of the Chief Financial Officer

Working capital fund.............................................   727

                Office of the Chief Information Officer

Budget request, fiscal year 2000.................................   729
Capital planning and investment control..........................   732
Clinger-Cohen:
    Act..........................................................   802
    Compliance...................................................   731
Commodity Credit Corporation (CCC) funding cap...................   812
Independent verification and validation..........................   733
Information technology (IT):
    Acquisition moratorium.......................................   733
    Budget, overall USDA.........................................   789
    Contractor assistance........................................   796
    Security.....................................................   735
    Workforce planning and development...........................   733
Interagency food safety initiative...............................   813
Pay costs........................................................   730
Presidential decision directive 63--PDD-63.......................   818
Project management...............................................   733
Support Services Bureau..........................................   806
Telecommunications...............................................   734
USDA:
    Agency business continuity and contingency plans.............   817
    Capital planning and information systems technology 
      architecture...............................................   802
    Critical infrastructure protection plan, time frames for 
      implementing...............................................   818
    Fiscal year 2000:
        Budget increase..........................................   803
        Information technology budget summary....................   729
    Information systems technology architecture..................   731
    Information technology:
        And telecommunications expenditures for PDD-63...........   819
        Budget...................................................   819
        Moratorium...............................................   805
    Programs, services, and benefits via the Internet, delivery 
      of.........................................................   811
    Response to GAO telecommunications management recommendations   814
    Service Center implementation................................   730
    Service centers..............................................   807
    Telecommunications savings in fiscal year 1999 and fiscal 
      year 2000..................................................   815
    Y2K:
        Emergency funding--approved and expected in fiscal year 
          2000...................................................   818
        Remediation, testing, and implementation, fiscal year 
          2000 expenditures for..................................   816
        Work on vulnerable processes and systems, fiscal year 
          2000 expenditures for..................................   816
        Preparation..............................................   815
Year 2000 strategy...............................................   735

                     Office of the General Counsel

Activities and issues, current...................................   741
Budget request, fiscal year 2000.................................   749
Mission..........................................................   740
Organization.....................................................   741

                        Office of the Secretary

Cochran Fellowship Program.......................................    47
Conservation:
    Farm option..................................................    39
    Programs.....................................................    16
Cotton loan deficiency payments..................................    40
County office workload...........................................    12
Crop insurance reform............................................    35
Customers service and program delivery...........................    16
Emergency funding................................................    38
Exports, U.S.....................................................    13
Farm:
    Assistance...................................................    11
    Credit.......................................................    13
    Economy......................................................    11
    Safety net...................................................    12
Food Aid Initiative..............................................    11
Food Quality Protection Act......................................    40
Foreign market development cooperator program....................    46
Gleaning and food recovery.......................................    15
Long-term dairy prices...........................................    37
Market concentration.............................................38, 43
Marketing and domestic programs..................................    14
Nutrition........................................................    15
Office of Inspector General......................................    35
Pseudorabies program.............................................    43
Research and food safety.........................................    15
Rural development................................................14, 45
SBA rural assistance.............................................    44
Supplemental:
    Appropriations...............................................36, 42
    Request......................................................    40

 Office of the Secretary for Rural Economics and Community Development

Alternative Agricultural Research and Commercialization 
  Corporation....................................................   773
Rural:
    Business-Cooperative Services................................   772
    Development budget request...................................   769
Rural Housing Service............................................   769
    Community facilities.........................................   771
    Farm labor housing...........................................   771
    Multi-family housing.........................................   770
    Mutual and self-help housing.................................   770
    Rental assistance............................................   770
    Single family housing........................................   770
Rural Utilities Service..........................................   771
Distance learning/telemedicine...................................   772
Water and waste disposal.........................................   772
Salaries and expenses............................................   773

             Office of the Under Secretary for Food Safety

Consumer Safety Offices..........................................   529
Egg safety inspections...........................................   538
Fight BAC........................................................   550
Fiscal year 2000:
    Budget request...............................................   519
    FSIS budget request..........................................   521
    USDA food safety budget request..............................   528
Food:
    Distribution system, changes in..............................   539
    Irradiation..................................................   544
    Safety:......................................................
        Education................................................   549
        Initiatives, coordination of.............................   531
        Programs.................................................   535
        Progress.................................................   539
Foodborne:
    Disease outbreak.............................................   532
    Illness, incidence of........................................   533
Fruits and vegetables:
    Inspection of imported.......................................   544
    Outbreaks from...............................................   543
    Regulatory standards for.....................................   541
FSIS activities..................................................   526
HACCP:
    Compliance...................................................   536
    Implementation...............................................   520
    Frequency of inspection under................................   536
Imported:
    Foods, inspection of.........................................   530
    Product, inspection of.......................................   537
Inspections......................................................   536
Inter-agency Cooperation.........................................   518
Interagency Food Safety Initiative...............................   547
Meat and Poultry Act, safe and fair enforcement and recall of....   519
NAS report, USDA response to.....................................   525
President's Council on Food Safety...............................   519
President's Food Safety Initiative...............................   517
Recall authority.................................................   540
Red meat, proposed rulemaking on irradiation of..................   548
Regulatory standards.............................................   542
U.S. Customs--FDA cooperation....................................   545
USDA Food Safety Overview........................................   523

  Office of the Under Secretary for Research, Education, and Economics

Agency fiscal year 2000 budgets..................................   764
Initiatives, fiscal year 2000....................................   762

                          Research Activities

Agricultural Research, Extension, and Education Reform Act of 
  1998, implementation of the....................................   947
Agriculture, sustainable.........................................   949
Budget, fiscal year 2000.........................................   979
Competitive grants...............................................   960
1890 facilities..................................................   966
Extension activities.............................................   965
Extension Indian reservation.....................................   973
Farm safety and AgrAbility.......................................   965
FARM*A*SYST....................................................974, 977
Farms, small.....................................................   978
Food:
    Quality Protection Act risk mitigation and crops at risk.....   974
    Recovery and gleaning........................................   975
    Safety initiative............................................   964
Formula funds....................................................   958
Integrated activities............................................   973
Management.......................................................   959
Methyl bromide...................................................   977
National research initiative.....................................   964
1994 institutions funding........................................   973
Rural health.....................................................   965
Thomas Jefferson initiative......................................   948
U.S. global change...............................................   948

                   Research, Education, and Economics

Agricultural problems............................................   989
Biobased Coordinating Council....................................   984
Farmers and producers, information to............................   990
Integrated pest management.......................................   989
Research portfolio...............................................   988
Stakeholder, response to concerns................................   987
Stakeholders.....................................................   985
Strategic planning task force....................................   983

                   Rural Business-Cooperative Service

Business and industry guaranteed and direct loan programs........   766
Cooperative research agreements..................................   768
Intermediary Relending Program...................................   767
Rural:
    Areas, appropriate technology transfer for...................   768
    Business enterprise grants...................................   767
    Business opportunity grants..................................   767
    Cooperative development grants...............................   767
    Economic development loans and grants........................   767

                         Rural Housing Service

And its partners leverage their resources to build communities...   778
Programs help level the playing field for rural children.........   774
Programs provide rural America's elderly poor with safe and 
  affordable housing.............................................   777

                        Rural Utilities Service

Distance learning and telemedicine...............................   781
Electric:
    Program......................................................   781
    Restructuring legislation....................................   783
Financially stressed borrowers...................................   782
Native American outreach.........................................   784
New telecommunications & electric competitive environments.......   783
Reform, reinvention and responsibilities.........................   779
Rural America, Federal partnership with..........................   780
Telecommunications--50 years of progress.........................   780
Water 2000 Presidential initiative...............................   782
Water and environmental programs.................................   782
Weather radio....................................................   784
Y2K outreach and readiness.......................................   783

       Under Secretary for Farm and Foreign Agricultural Services

Agricultural trade...............................................   168
Commodity Credit Corporation programs............................   159
Commodity Program Assistance.....................................   145
Conservation programs............................................   179
Conservation Reserve Program...................................148, 177
Cotton Program.................................................163, 182
Crop insurance.................................................170, 182
    Program......................................................   176
Crops, outlook for major.........................................   130
Dairy Assistance Program.........................................   164
Dairy:
    Exports, opportunities and obstacles to......................   166
    Policy.......................................................   165
    Prices, impact of trade agreements on........................   166
Disaster payments, timing of.....................................   161
Economic stress, conservation program assistance to producers 
  during times of................................................   180
Emergency programs...............................................   146
Export Program Authorities, use of...............................   164
Export:
    Programs.....................................................   149
    Tactics......................................................   169
Farm income and finance perspective, an overall assessment from 
  the............................................................   129
Farm:
    Loan programs................................................   147
    Policy choices...............................................   173
    Support......................................................   171
Farmers, number of...............................................   172
FSA staffing, fiscal year 2000...................................   185
Honey loans......................................................   181
Livestock Assistance Program.....................................   163
Livestock, outlook for...........................................   133
Macroeconomic Overview...........................................   128
NAFTA trade increases............................................   169
Natural Resources Conservation Service:
    Staff year reduction.........................................   178
    Technical assistance.........................................   153
Outlook, key uncertainties in the................................   136
Production agriculture...........................................   174
Resources Conservation Service...................................   151
Retail food prices, outlook for..................................   135
Risk management..................................................   148
Russia, monitoring food aid to...................................   184
Trade negotiations...............................................   150
U.S. Agricultural exports, outlook for...........................   128
Watershed facilities.............................................   178

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

               Centers for Disease Control and Prevention

Food Safety, the challenges of...................................   321
Foodborne Diseases and Food Safety, CDC's Role in................   320
FoodNet..........................................................   322
National Food Safety Initiative at CDC in fiscal year 2000.......   324
PulseNet.........................................................   322

                      Food and Drug Administration

Antimicrobial use in food animals, the issue of..................   406
Appropriations Committees of the House and Senate, report to.....   496
Aquaculture......................................................   633
    Drug submissions, review of..................................   663
Bioterrorism...................................................642, 681
    Initiative...................................................   681
Budget...........................................................   628
Buildings and facilities.........................................   660
CFCS, rule on....................................................   663
Clinical Pharmacology Program....................................   662
Codex Alimentarius...............................................   673
    Activities...................................................   379
    Standards....................................................   455
Collaboration and FDAMA..........................................   675
Commerce Seafood Inspection Program to FDA, transfer of the......   644
Cooperative activities...........................................   511
Current issues...................................................   409
Detection methods, accomplishments in the area of................   455
Domestic inspections.............................................   248
    High risk areas..............................................   649
Drug testing.....................................................   702
Education........................................................   512
Electronic submissions...........................................   696
Enriched foods...................................................   671
FDAMA............................................................   679
Field consolidation..............................................   683
Fiscal year:
    1998 achievements............................................   329
    1999 plans...................................................   331
    2000 budget request..........................................   332
Food and Drug Administration:
    Education activities.........................................   394
    National Center for Food Safety and Technology 
      accomplishments............................................   515
Food safety:
    Initiative, the President's..................................   328
    Problem......................................................   327
    Research.....................................................   392
        By the Agricultural Research Service.....................   404
    System on science, base the..................................   498
FSI funding......................................................   688
Generic drugs....................................................   655
    Applications backlog.........................................   704
Government Performance and Results Act...........................   665
Guidance/information collection..................................   510
Hazards, early detection and containment of......................   330
Injury reporting.................................................   642
Inspection:
    Domestic.....................................................   648
    International................................................   640
    Seafood......................................................   639
Medguides........................................................   703
Medical devices:
    Re-use of single use..................................670, 697, 703
    Single use...................................................   634
    Statutory review times.......................................   673
Memorandum of Understanding......................................   359
Microbial resistance.............................................   695
Monograph, over-the-counter sunscreen............................   664
NAS Report Recommendations.......................................   508
National center..................................................   515
National Research Initiative awards fiscal year:
    1997.........................................................   418
    1998.........................................................   424
New user fees....................................................   653
Off-label promotions.............................................   636
Office of Cosmetics and Color and Related Field activities.......   662
Office of Seafood Inspection.....................................   664
Office of the Commissioner, reorganization of the................   630
On-line druggists................................................   701
Orphan drug:
    Funding......................................................   702
    Product development..........................................   638
Orphan Drug Research Grant Program...............................   664
OTC sunscreen monograph........................................664, 684
PDUFA fee collections............................................   659
PDUFA, fiscal year 2000 appropriation base for...................   659
Physicians pay compensation......................................   641
Premarket application review.....................................   651
Prescription Drug User Fee Act...................................   658
Prescription drugs...............................................   686
    Advertising..................................................   638
    Cost of....................................................633, 679
    Importation..................................................   687
President's Council on Food Safety Assessment of the NAS Report: 
  Ensuring Safe Food from Production to Consumption............366, 497
Priorities.......................................................   621
Product safety assurance.......................................646, 647
Public meetings..................................................   513
Recommendation I--Base the food safety system on science.........   366
Regulatory/enforcement...........................................   509
Regulatory review................................................   668
Relocation costs.................................................   656
Research.........................................................   513
    And actions..................................................   406
Resources, training of...........................................   697
Science base.....................................................   632
Scientific disputes, resolving...................................   678
Spending priorities..............................................   650
Special food safety research grants fiscal year 1998.............   431
Special research grants..........................................   459
Special site specific food safety research grants fiscal year 
  1998...........................................................   432
Supreme Court and tobacco,.......................................   685
Tamoxifen........................................................   699
Tobacco........................................................629, 657
    Activities.................................................699, 701
    Funding......................................................   684
    Rule.........................................................   672
USDA/FSIS activities...........................................509, 511
USDA's 1997 Agricultural Resource Management Study, data from....   601
User fee legislation.............................................   674

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