[Senate Hearing 106-784]
[From the U.S. Government Publishing Office]
S. Hrg. 106-784
INTERSTATE SHIPMENT OF STATE-INSPECTED MEAT AND POULTRY
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HEARING
before the
COMMITTEE ON AGRICULTURE,
NUTRITION, AND FORESTRY
UNITED STATES SENATE
ONE HUNDRED SIXTH CONGRESS
SECOND SESSION
ON
INTERSTATE SHIPMENT OF STATE-INSPECTED MEAT AND POULTRY
__________
APRIL 6, 2000
__________
Printed for the use of the
Committee on Agriculture, Nutrition, and Forestry
U.S. GOVERNMENT PRINTING OFFICE
67-862 CC WASHINGTON : 2000
_______________________________________________________________________
For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC
20402
COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
RICHARD G. LUGAR, Indiana, Chairman
JESSE HELMS, North Carolina TOM HARKIN, Iowa
THAD COCHRAN, Mississippi PATRICK J. LEAHY, Vermont
MITCH McCONNELL, Kentucky KENT CONRAD, North Dakota
PAUL COVERDELL, Georgia THOMAS A. DASCHLE, South Dakota
PAT ROBERTS, Kansas MAX BAUCUS, Montana
PETER G. FITZGERALD, Illinois J. ROBERT KERREY, Nebraska
CHARLES E. GRASSLEY, Iowa TIM JOHNSON, South Dakota
LARRY E. CRAIG, Idaho BLANCHE L. LINCOLN, Arkansas
RICK SANTORUM, Pennsylvania
Keith Luse, Staff Director
David L. Johnson, Chief Counsel
Robert E. Sturm, Chief Clerk
Mark Halverson, Staff Director for the Minority
(ii)
C O N T E N T S
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Page
Hearing:
Thursday, April 6, 2000, Interstate Shipment of State-Inspected
Meat and Poultry............................................... 1
Appendix:
Thursday, April 6, 2000.......................................... 39
Document(s) submitted for the record:
Thursday, April 6, 2000.......................................... 91
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Thursday, April 6, 2000
STATEMENTS PRESENTED BY SENATORS
Lugar, Hon. Richard G., a U.S. Senator from Indiana, Chairman,
Committee on Agriculture, Nutrition, and Forestry.............. 1
Fitzgerald, Hon. Peter G., a U.S. Senator from Illinois.......... 8
Harkin, Hon. Tom, a U.S. Senator from Iowa, Ranking Member,
Committee on Agriculture, Nutrition, and Forestry.............. 13
Daschle, Hon. Tom, a U.S. Senator from South Dakota.............. 4
Baucus, Hon. Max, a U.S. Senator from Montana.................... 6
Johnson, Hon. Tim, a U.S. Senator from South Dakota.............. 6
Lincoln, Hon. Blanche, L., a U.S. Senator from Arkansas.......... 7
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WITNESSES
Hatch, Hon. Orrin G., a U.S. Senator from Utah................... 2
Panel I
Rominger, Richard, Deputy Secretary, U.S. Department of
Agriculture, Washington, DC; accompanied by Ms. Margaret O'K.
Glavin, Associate Administrator for Food Safety; accompanied by
Ms. Caren Wilcox, Deputy Under Secretary for Food Safety....... 10
Panel II
Boyle, Patrick, President and CEO, American Meat Institute,
Arlington, VA.................................................. 34
Dailey, Fred L., Director, Ohio Department of Agriculture,
President, National Association of State Departments of
Agriculture, Reynoldsburg, OH.................................. 23
Eickman, Michael, Eickman's Processing Co., Inc., representing
the American Association of Meat Processors, the Illinois
Association of Meat Processors, and 18 other state meat
processing associations, Seward, IL............................ 26
Foreman, Carol, Tucker, Distinguished Fellow and Director of the
Food Policy Institute Consumer Federation of America,
Washington, DC................................................. 32
Heikens, Jolene, Triple T Country Meats, representing the
American Association of Meat Processors, the Iowa Association
of Meat Processors, and 18 other state meat processing
associations, Wellsburg, IA.................................... 27
Nielson, Richard T., President, Utah Cattlemen's Association,
representing the National Cattlemen's Beef Association, Salt
Lake City, UT.................................................. 30
Pearson, Harry, President, Indiana Farm Bureau, representing the
American Farm Bureau Federation, Indianapolis, IN.............. 29
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APPENDIX
Prepared Statements:
Lugar, Hon. Richard G........................................ 40
Roberts, Hon. Pat............................................ 41
Harkin, Hon. Tom............................................. 50
Daschle, Hon. Tom............................................ 84
Johnson, Hon. Tim............................................ 86
Hatch Hon. Orrin, G.......................................... 88
Boyle, Patrick............................................... 82
Dailey, Fred L............................................... 52
Eickman, Michael............................................. 63
Foreman, Carol, Tucker....................................... 77
Heikens, Jolene.............................................. 68
Nielson, Richard T........................................... 74
Pearson, Harry............................................... 70
Rominger, Richard............................................ 43
Document(s) submitted for the record:
Position statement, submitted by Mike Lorentz, Cannon Falls,
MN......................................................... 92
Position statement, submitted by Michael Weaver, President,
Weaver Meats, Inc., Past President, Ohio Assoc. of Meat
Processors................................................. 94
Position statement of the National Chicken Council........... 96
Position statement of the Consumer Federation of America,
submitted by Nancy Donley, President S.T.O.P., Caroline
Smith DeWaal, Food Safety Director, CSPI, Carol Tucker
Forman, Director, Food Policy Institute CFA,............... 101
Excerpts from the Wall Street Journal ``Consumer Groups Decry
State Meat Inspections'', submitted by Carol Tucker Forman. 104
Position statement of the Kansas Department of Agriculture,
submitted by Bill Graves, Governor......................... 109
Position statement of the National Confreence of State
Legislatures, submitted by Larry Diedrich, South Dakota
House of Representative Chair, NCSL Agriculture and
International Trade Committee.............................. 111
House Concurrent Resolution No. 5050, submitted by Hon. Pat
Roberts.................................................... 115
INTERSTATE SHIPMENT OF STATE-INSPECTED MEAT AND POULTRY
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THURSDAY, APRIL 6, 2000
U.S. Senate,
Committee on Agriculture, Nutrition, and Forestry,
Washington, DC.
The Committee met, pursuant to notice, at 9:37 a.m., in
room SR-328A, Russell Senate Office Building, Hon. Richard G.
Lugar, (Chairman of the Committee), presiding.
Present or submitting a statement: Senators Lugar,
Fitzgerald, Harkin, Daschle, Baucus, Johnson, and Lincoln.
OPENING STATEMENT OF HON. RICHARD G. LUGAR, A U.S. SENATOR FROM
INDIANA, CHAIRMAN, COMMITTEE ON AGRICULTURE, NUTRITION, AND
FORESTRY
The Chairman. This meeting of the Senate Agriculture
Committee is called to order. The Committee is holding this
hearing today to review interstate shipments of State-inspected
meat and poultry.
This is not a new issue for the Committee. Small plants
that have operated under State inspection programs have long
advocated interstate shipment of State-inspected meat and
poultry. Plants located near the border with another State have
been particularly supportive of this change because of the
potential for increased markets for their products. Producers
have been supportive because of the potential for additional
markets for their livestock and poultry.
At the end of last year's session, Senators Daschle and
Hatch introduced legislation, S. 1988, which would permit
interstate shipment of State-inspected meat and poultry. This
legislation was based on a concept paper developed by the
United States Department of Agriculture and endorsed by the
National Advisory Committee for Meat and Poultry Inspection.
We have the opportunity today before this committee to hear
of support for this legislation and to air concerns about this
approach to allow interstate shipment of State-inspected meat
and poultry. We are honored to receive testimony from our
colleague, Senator Hatch, an advocate of interstate shipment of
State-inspected meat and poultry, and we will be pleased to
hear the United States Department of Agriculture's perspective
from Deputy Secretary Rominger. Finally, a panel of witnesses
will testify, including representatives of the State
Departments of Agriculture, producer groups, meat processors,
and consumers.
I offer a special welcome to Harry Pearson, representing
the American Farm Bureau Federation, and a good delegation of
Hoosiers who are with us today in this hearing.
Before proceeding to our witness, let me mention that as
soon as Senator Harkin, the distinguished ranking member,
appears, he will be recognized for an opening statement.
[The prepared statement of Senator Lugar, can be found in
the appendix on page 40.]
But for the moment, I would recognize our colleague,
Senator Hatch, who I aforementioned is one of the authors of
legislation we will be considering this morning. We are
delighted to have you, Orrin, and proceed with your testimony.
STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM UTAH
Senator Hatch. Thank you, Senator Lugar, Senator Daschle,
Senator Johnson. I am grateful to be with you and I applaud you
for holding this hearing. I am particularly pleased that you
are going to have the opportunity to hear from Richard Nielson,
the President of the Utah Cattlemen's Association. I am sure
you will find his testimony cogent and very informed.
As you know, the New Markets for State-Inspected Meat Act,
the Daschle-Hatch bill, would lift the outdated ban on the
interstate shipment of State-inspected meat. Rather than state
all the details of this legislation, I would like to describe
to the members of this committee how the ban on interstate
shipment is affecting small businessmen in rural Utah. I want
to emphasize that what we are seeing in Utah is echoed in at
least half the States in this country. The business owners I
will tell you about own small meat packing plants that are
inspected by State inspectors.
The first is Eddie Roberts, who owns Tooele Valley Meats in
Grantsville, Utah, not far from the Nevada border. Eddie is
well known in the area for making some of the finest sausage
available anywhere. Casinos just across the border in Wendover,
Nevada, know of his sausage products and have tried to purchase
them. Contracts with these casinos would be a tremendous boost
for Tooele Valley Meats, but as we all know, Eddie is barred by
law from selling his sausage products in Nevada or any other
State.
A casino in Las Vegas has also approached him, telling him
they would buy as many roaster pigs as Eddie could produce, but
the ban also applies to poultry. So much for rewarding product
excellence. Mr. Chairman and the members of this committee, I
am sure you appreciate what an order like that would mean for a
small business in a rural community. Once again, Tooele Valley
Meats was forced to turn down what they considered to be a
dream opportunity.
In Smithfield, Utah, Monte Lucherini owns L&H Packing
Company, a State-inspected plant just 15-miles from the Idaho
border. This plant produces roast beef, jerky products, hot and
mild sausage, and other products. Monte has been contacted by a
number of businesses in Idaho seeking to purchase his products.
Once again, a small businessman in a rural area was faced with
a chance to expand his business but was forced to turn it down.
With regard to this legislation, Monte has said, and I
quote, ``I believe that my gross sales would increase 30- to
40-percent. Employment would be increased also. I would need
more butchers and more workers. It has also been a thorn in our
side that we could not service the customers that want our
products.'' So much for encouraging investment.
In Vernal, Utah, Don Anderson owns and operates Uintah
Packing. The principal part of Don's business has been selling
steaks to river outfitters taking visitors down the Green and
Colorado Rivers. He was doing excellent business with these
customers until it was pointed out to the river guides that
they could not serve Don's product because a portion of the
river trip would dip into Colorado and Arizona, thus making it
illegal for them to serve steaks produced by a State-inspected
plant. Well, Mr. Chairman, Don lost his business and has never
fully recovered from it. In this case, the currently policy not
only hindered business, it actually hurt it.
Finally, I would like to talk about Theone Merrill. Theone
owns Heartland Foods in northern Utah and produces a number of
excellent products, many of which are cooked and canned. Now,
Mr. Chairman, Theone has an idea. He has recognized that if he
could tap into the Internet as a marketing tool, the entire
world would be within reach of his products. He had already
learned of interested buyers of his products in other States,
but he will not be able to pursue those markets. Needless to
say, Theone is eager for the passage of this bill. Just as in
the other cases, Mr. Chairman, his market is limited to the
State of Utah. So much for rewarding innovation and risk
taking.
Now, these stories and the others like them around the
country would be enough in my book to take action on this bill,
but there is more. Each of the plants I have mentioned is
completely free to sell buffalo meat, pheasant, ostrich,
alligator, emu, and other meat products not only across State
boundaries but even to foreign nations, and these meat products
are inspected by State inspectors. Yet State-inspected beef,
pork, and poultry cannot travel a few miles from Tooele, Utah,
to Wendover, Nevada.
Let me put this another way, Mr. Chairman. We trust State
inspectors to efficiently inspect emu but not beef, and it is
okay to sell State-inspected beef or pork in Utah, but nowhere
else. This makes absolutely no sense, Mr. Chairman.
But what makes even less sense, Mr. Chairman, is the fact
that while those Nevada casinos or Idaho supermarkets are
banned from buying sausage and other products from Utah, they
have no problem whatsoever in importing those products from a
foreign country. Foreign competitors have full freedom to sell
their foreign-inspected products in the United States, and, of
course, they are more than willing to do so.
Mr. Chairman, I know you share my view that the American
economic system should reward excellence, hard work, effort,
and investment, yet current policy concerning State-inspected
meat is holding Americans back for no justifiable reason. It is
just plain stupid and I hope you and the other members of this
committee will agree.
Not only does this policy of prohibiting the interstate
distribution of State-inspected meat stifle the growth and
prosperity of individual small businesses, but it also
contributes to the concentration in the meat packing industry
in our country. As I am sure every member of this committee
knows, there are fewer and fewer places for our livestock
producers to sell their products.
I believe the New Markets for State-Inspected Meat Act will
help to increase competition in the meat packing industry. You
do not need to take my word for it. Three separate USDA
Advisory Committees have recommended lifting the ban on
interstate shipment as a way to create more opportunities for
small packers and livestock producers in rural America.
I think that events in the State of Minnesota have
confirmed this. Minnesota began a State inspection system only
last year. As a result, in only a short time, 30 new plants
started up in that State. Now, this is good for competition, it
is good for consumers, and good for livestock producers.
The Minnesota experience also demonstrates what many small
plant owners have expressed to me, that most small plant owners
prefer to work with State inspectors, which tend to be much
more hands-on, informative, and responsive than Federal
inspectors. This is why the small plants in Utah and in other
States would be happy to comply with Federal inspection
standards but shy away from turning their plants over to
inspection by Federal inspectors. This is a key point, Mr.
Chairman. There is absolutely nothing about this bill that
would compromise food safety.
The time is ripe to do away with the outdated and anti-
competitive ban on interstate shipment of State-inspected meat.
This bill will open markets and spur growth in the meat packing
industry. It will be good for our small plant owners, our
livestock producers, and rural America in general. So I urge
the members of this committee to report this measure to the
full Senate as soon as possible, and I want to thank personally
the prime sponsor of this bill, Senator Daschle, for his
willingness to lead out in this manner and to continue this
fight to change what really is something that needs to be
changed.
I want to thank you for giving me this time this morning.
The Chairman. Thank you very much, Senator Hatch, for your
testimony.
It is appropriate that, in fact, the co-author, Senator
Daschle, is at hand, the Democratic leader and a distinguished
member of our committee. Tom, would you like to make a
statement or respond to Orrin or boost your bill or anything
pertinent you may have?
Senator Hatch. Come on, Tom, let us get up here.
STATEMENT OF HON. TOM DASCHLE, A U.S. SENATOR FROM SOUTH DAKOTA
Senator Daschle. First of all, Mr. Chairman, I thank you,
as Orrin has, for holding this hearing. This is another example
of your extraordinary interest in many of the issues relating
directly to agriculture.
I think Senator Hatch has pointed out as succinctly as I
have heard the implications for processors all over the
country, but in his State in particular. He has also pointed
out the irrationality of the current situation and the
implications of current law for not only producers but for
agriculture in general.
So I applaud him for his statement. I congratulate him on
an excellent statement and appreciate very much his direct
involvement in this legislation. He and I have been working on
this now for some time. We have 17 other cosponsors on a very
bipartisan basis, and so I am pleased that we have been able to
get to this point.
It is hard to believe that Congress has been debating this
issue now for over 20-years. As a result of a lot of work by
USDA and numerous other groups interested in the issue, at
last, we have a proposal that Senator Hatch has outlined that
can provide interstate shipment authority in a way that
benefits everyone, either directly or indirectly. He and I, as
I noted, had been working on this bill for a good period of
time now, about 6 months, and it is based on recommendations
made by the National Advisory Committee for Meat and Poultry
Inspection.
It is good for small plants, as Senator Hatch has noted,
and the communities in which they are located. We think it is
good for farmers and ranchers. It is good for the States with a
State-inspection program. We think it is very good for
consumers and it is good for the market because we think it
will stimulate competition as well as innovation.
Under current law, only State-inspected bison, venison,
pheasant, and ostrich can be shipped interstate. S. 1988 would
expand this shipment, at long last, to include beef and pork
and lamb and poultry. Products would be eligible for interstate
shipment, export to other countries, and use in products
destined for export to other countries, as well.
As Senator Hatch has noted, the current law severe limits
State plants' marketing opportunities and unfairly penalizes
them based on size and gives unfair market advantage to bigger
plants for which Federal inspection is an option. This
limitation penalizes producers, who bear the added
transportation costs of shipping products to Federally-
inspected plants if they want to market out of State. The
current law is inequitable among species, of course. Some
species can be shipped across State lines while others cannot.
So with the full implementation of HACCP, State and Federal
inspection programs will be enforcing the same food safety and
standards and we will have the same seamless food safety
inspection system we have talked about having now for some
period of time.
With S. 1988, we still have the benefit of our State-
inspection programs and their specialized knowledge of local
needs. In South Dakota, for example, we have 53 State-inspected
plants. A number of them serve very isolated populations.
So, Mr. Chairman, allowing this interstate and
international shipment of products inspected at these plants
would provide a tremendous opportunity for the producers that
Senator Hatch noted, producers and processors in South Dakota,
to owners and employees of these plants who have new business
opportunities and to towns that are in need of new business and
capital flow.
So I am really interested in the testimony this morning of
a number of witnesses who have come distance, as well as our
experts from the Department of Agriculture. I again thank you
for your interest in this issue and especially thank Senator
Hatch for his cosponsorship and his leadership, as well.
The Chairman. Thank you very much, Senator Daschle.
Let me ask each of the Senators who have joined this
hearing if they have opening comments or questions of our
witness, Senator Hatch. Senator Johnson?
STATEMENT OF HON. TIM JOHNSON, A U.S. SENATOR FROM SOUTH DAKOTA
Senator Johnson. Just very briefly, I want to thank you,
Mr. Chairman, for holding this hearing and Senator Hatch's
leadership on this important bipartisan issue. As Senator
Daschle has noted, this issue has been around a long, long time
and it is overdue that we finally address it in a constructive
way this year.
I am pleased to be a cosponsor of S. 1988. This
legislation, as Senator Daschle has noted and Senator Hatch has
noted, would help create a seamless system of meat inspection
between State and Federal systems, and particularly now with
implementation of our HACCP system, we have the support of USDA
and a great number of agricultural as well as consumer
organizations in this country.
At a time when there has been a lot of frustration
expressed in South Dakota among my producers about lack of
competition and integration going on in the packing industry,
this is a step, I think, in the right direction which would be
a boon, I think, to livestock producers as well as to the
State's economy, to the economy of many small communities, as
well as to consumers. As Senator Daschle has noted, we have
some 53 small packing plants in South Dakota. Many of them are
right along our borders, but for artificial and no longer
rational reasons, not allowed to market their products across
the State lines into Minnesota, Iowa, North Dakota, Wyoming,
and Nebraska.
I am confident talking to these producers in their small
plants around the State that this would do a great deal to
allow them to expand their business. It would create new niche
markets for many of our livestock producers at a time when they
need more alternative marketing opportunities for themselves
and it would create greater competition in the livestock and
meat industry in general. I think that is a good thing for
consumers and it is a good thing, I think, for the country as a
whole.
So I applaud USDA's work with us on this legislation and
all the bipartisan cosponsors of this bill and I am hopeful
that we can, in fact, move beyond a hearing to a markup point
at some expeditious time. Thank you.
The Chairman. Thank you very much, Senator Johnson.
Senator Baucus.
STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR FROM MONTANA
Senator Baucus. I thank the Chairman. Mr. Chairman, as I
think and reflect upon this issue, it really is somewhat in a
certain sense sad that it takes Congress so long to do
something that is so right. This is a no-brainer. Clearly,
inspection plants, packing plants, processors in our country,
whether they are Federal or State, should be able to ship
product across State lines because under HACCP they will be
subject to the same inspection standards. It just makes no
sense at all for me that anyone would oppose this legislation.
it is just that simple.
Senator Johnson made a very good point about niche markets.
This legislation will enable lots of different people to market
their own meat products in a way that makes sense to them. We
in my State, Mr. Chairman, we call ourselves the Big Sky State
and we like to think that ``Made in Montana'' is going to be a
good selling point, not only nationwide but internationally. It
is my hope that this legislation is tailored in a way so that
State-inspected plants will be able to sell not only across
State lines but around the world.
And clearly, it is to the best interest of a State
processing plant to be safe. If they are going to sell their
product and have it accepted, and probably because they are
small, they know they have got to do a good job and they are
going to do a good job.
It is analogous to me like start-ups in the high-tech
world. You have all these start-ups because people in our
country today have the opportunity, if he or she has a good
idea, to follow up and pursue it, and I think the same should
be true here. If a group of people want to get together and put
together their processing plant, they ought to be able to do
so. There have been many attempts in my State that have been
futile, frankly, and one of the reasons is this. It is just
hard to ship. You cannot across State lines.
I very much commend Senator Hatch, Senator Daschle, and
others for finally getting this bill together. I am a
cosponsor, proudly. Many others are, too. This is getting to be
a thing, Senator. You and I are on a lot of bills, I have
noticed. This is one more.
Senator Hatch. It is starting to worry me.
[Laughter.]
Senator Baucus. It is a good sign. We Westerners are
sticking together.
Thank you very much, Mr. Chairman.
The Chairman. Thank you, Senator Baucus.
Senator Lincoln.
STATEMENT OF HON. BLANCHE LINCOLN, A U.S. SENATOR FROM ARKANSAS
Senator Lincoln. Thank you, Mr. Chairman. I appreciate your
holding the hearing today and want to welcome Senator Hatch and
thank him for his hard work on this issue.
Food safety is an extremely important issue, I think, to
all of us and I am pleased that the Committee is working on
this issue here in this bill so that we can review the proposal
that has been offered regarding the interstate shipment of
State-inspected meat and poultry. The administration and
several members of this committee have been working very hard
on this measure to ensure that there is a consensus, and I
applaud that effort and I would like to work to that degree.
However, I do represent a State that has a very large
poultry interest, and today the poultry industry still has a
few concerns about the impact of this legislation, so I may
have a few questions for the panelists later on. I am delighted
to hear from Senator Hatch and would certainly like to ask him
that maybe if there is a possibility, we can look at some of
the concerns that we do have from the poultry industry's side.
I look forward to the witnesses that will present that and
would just simply highlight that food safety is truly the
ultimate issue here and that we do not forget that and that we
reflect on it, and as we can make improvements, hopefully we
will to this very important issue.
So thank you, Mr. Chairman, and thanks, Senator Hatch.
The Chairman. Thank you, Senator Lincoln.
The Chair would like to enter into the record a statement
from Senator Roberts, who is a cosponsor of the legislation and
is supportive of it.
[The prepared statement of Senator Roberts can be found in
the appendix on page 41.]
Senator Fitzgerald.
STATEMENT OF HON. PETER FITZGERALD, A U.S. SENATOR FROM
ILLINOIS
Senator Fitzgerald. Thank you, Mr. Chairman. I would like
to welcome the distinguished Chairman of the Judiciary
Committee here. You do our Agriculture Committee much honor by
coming before us and I am pleased to be a cosponsor of your
legislation, Senator Hatch.
I think that now, in an era when we have a meat processing
sector that continues to consolidate, and we are hearing a lot
of complaints from the farm community about the continued
consolidation at the end producer level, we now have the four
largest processors controlling approximately 80-percent of the
fed cattle market and approximately 60-percent of the pork
market, it seems to me that allowing State-inspected plants to
compete on a nationwide basis is a very worthwhile goal. I
compliment you on this legislation.
Illinois, according to our Illinois Department of
Agriculture, has 283 meat processors. These plants employ about
6,000 people and have annual sales totaling $425 million.
Whenever I am at a Farm Bureau meeting anywhere in any county
in Illinois, somebody who is from one of these State-inspected
plants will get up and complain that they cannot export their
meat out of State.
So I think we need to look at if these plants are complying
with USDA standards, if they are using some of the science-
based technology that the USDA is now requiring, I think it
will improve food safety in our country, and in addition, it
will allow for some more competition in the meat industry, give
the farmers more end producers to sell their livestock to, and
be good for consumers. So I want to congratulate Senator Hatch
and I am pleased to be a cosponsor.
I also want to point out that one of my constituents,
Michael Eickman of Eickman's Processing Company in Seaward,
Illinois, is here today and he is representing the American
Association of Meat Processors, a national organization of 19
State meat processing associations. Mr. Eickman, I want to
thank you for traveling to our nation's capital to be with us
today.
Thank you very much.
The Chairman. Thank you very much, Senator Fitzgerald.
Senator Hatch, you have heard from your colleagues and we
appreciate very much your coming to offer this testimony
personally.
Let me just say that your presence prompts me to make
really a further request. As if often the case with Congress,
the jurisdiction of various committees is clear with regard to
some issues and yet the issues are sometimes bigger than all of
our committees. We have been talking in this committee a good
bit about agricultural concentration. That was reflected in
some of the statements by Senators today, Joel Klein before the
Committee and others who are involved in that issue and we will
be talking about that some more. We appreciate the cooperation
with you as chairman of Judiciary and your members because
obviously these are subjects of great interest to you. You have
the whole antitrust issue in the country, but the agricultural
part of it is very important to us.
In the same spirit as we have worked with Senator Gramm in
the Banking Committee and our own Senators, Senator Johnson,
Senator Baucus, Senator Daschle, Senator Leahy are very active
in the debate on extending to rural America the television
satellite situation in the recent debate. These issues bob up
in various ways, but they are of great importance to rural
America, as you understand with your constituents.
So we thank you for coming to be with us today and for
giving of your time.
Senator Hatch. I want to thank you, Mr. Chairman, and all
of you who are cosponsors, particular Senator Daschle, who is a
great leader and a very fine friend, and I really appreciate
being given this time. I hope you will listen to our Utah
cattlemen. They are good people.
The Chairman. We will listen carefully.
Senator Hatch. Thanks a lot.
The Chairman. The chair would like to call now the Deputy
Secretary of Agriculture, Richard Rominger. He will be
accompanied by Ms. Margaret O'K. Glavin, Associate
Administrator for Food Safety, and Ms. Caren Wilcox, Deputy
Under Secretary for Food Safety.
Secretary Rominger, we are pleased to have you, as always.
You have been faithful in responding to our calls for testimony
and have given us the benefit of your wisdom and counsel and we
look forward to that again today.
Before you begin, let me mention that my understanding
still is that there will be two roll call votes cast at 10:30,
which is a half an hour from now. That will necessarily mean
the absence of most Senators for about a half an hour, given
the time that it often takes to get the first vote cast and the
second. So I ask your forgiveness to begin with before we even
begin, but we would like to hear your testimony and then begin
to proceed with Senators' questions. We probably will be
interrupted somewhere in that passage. When we return, other
Senators will be recognized if you can wait that half hour or
so, and we will proceed then and then move on to our panel of
other distinguished witnesses.
Mr. Secretary.
STATEMENT OF RICHARD ROMINGER, DEPUTY SECRETARY, U.S.
DEPARTMENT OF AGRICULTURE, WASHINGTON, DC.; ACCOMPANIED BY
MARGARET O'K. GLAVIN, ASSOCIATE ADMINISTRATOR FOR FOOD SAFETY;
AND CAREN WILCOX, DEPUTY UNDER SECRETARY FOR FOOD SAFETY
Mr. Rominger. Thank you, Mr. Chairman and other members of
the Committee. I am pleased to be here today to talk about S.
1988, to remove the statutory prohibitions on interstate
shipment of State-inspected meat and poultry products that was
introduced by Senators Daschle and Hatch last year. In addition
to Senators Daschle and Hatch, I want to thank the ever-
increasing bipartisan group of Senators who have cosponsored
the legislation, which is known as the New Markets for State-
Inspected Meat Act of 1999.
As the former head of the California Department of Food and
Agriculture, I am pleased that we have finally come up with a
solution that is fair to States, fair to small producers, and
fair to consumers.
With me today, as you have indicated, are Deputy Under
Secretary for Food Safety Caren Wilcox and Associate
Administrator for Food Safety and Inspection Service Margaret
Glavin, who have worked diligently with all of the stakeholders
to resolve this interstate shipment issue.
The bill here today solves the perennial question of how to
level the playing field for small and very small State-
inspected meat and poultry processing plants, allowing them to
reach markets across State lines. I think the bill finds the
right balance, providing packers with access to compete in new
markets, ensuring the necessary Federal oversight to guarantee
consumers and our foreign trading partners of the integrity of
a seamless national inspection system, and maintaining the
identity of State inspection programs.
The genesis of this bill was a public meeting the
Department's Food Safety and Inspection Service held back in
June 1977 in Sioux Falls, South Dakota, at the request of
Senator Daschle. The meeting initiated a consensus approach
toward achieving interstate shipment for State products.
Subsequently, the Agency shared with our National Advisory
Committee on Meat and Poultry Inspection a concept paper on
interstate shipment, and ultimately the Committee composed of
consumer, State, and industry representatives endorsed this
carefully balanced concept as a basis for legislation.
When Senator Hatch requested a report on the
recommendations for lifting the ban on interstate shipment last
year, we were pleased to forward the administration's proposal.
The linchpin of this bill is the provision that States will
adopt and enforce Federal inspection statutes and regulations.
Inspected and passed State products will bear a Federal mark of
inspection, making it crystal clear wherever these products
move in commerce their safety and wholesomeness is assured by
the U.S. Government.
In addition, States will be allowed to continue to use
their State mark of inspection. They will also continue to be
allowed to impose additional requirements on plants voluntarily
opting for State inspection. But States cannot impose these
requirements on or interfere with the free movement of product
originating from Federal or another State's plants.
Before State-inspected plants can ship interstate, USDA
will first conduct comprehensive reviews of the State programs,
confirm that all the recommendations from the reviews have been
implemented, and then annual comprehensive reviews will
continue to verify that States are fully enforcing Federal
inspection requirements.
Under the Hazard Analysis and Critical Control Point, the
HACCP inspection system now in place, the Nation's food supply
is even safer than it has been. We have seen the overall
presence of salmonella in broilers, swine, ground beef, and
ground turkey drop, and for some species by as much as 50-
percent. To strengthen the seamlessness of the national
inspection program under S. 1988, all salmonella performance
standard samples for products eligible for a Federal mark of
inspection, whether produced in a Federal or a State
establishment, will be collected by the Department and analyzed
in our laboratories. We believe this will also give consumers
confidence of the Federal oversight of the system.
So we think the time is ripe for S. 1988 with the final
implementation of HACCP in January of this year. The
approximately 2,300 State plants have adapted to the HACCP
system very successfully and are producing safe and wholesome
product under this new system of inspection. With the carefully
planned in-depth reviews, the confidence will be there among
consumers, industry, the States, and the Department to remove
the inequity and allow State-inspected plants to ship their
products interstate under the provisions of this bill.
We have 25 great State partners that are on the map listed
up there with the expertise to best provide inspection for
their small and very small State plants. The States are
illustrated on that chart. Those are the ones that are speckled
there. USDA wants to strengthen its relationship with the State
programs and ensure their viability. In fact, we want to
encourage more States to implement their own program.
To this end, the bill calls for raising the Federal
reimbursement up to 60-percent of the cost of operating a State
program. Currently, FSIS will reimburse a State for only up to
50-percent of its program's costs.
Additionally, since these are voluntary programs on the
States' part and a State's resources are not inexhaustible,
States would be permitted to limit the size of plants that are
eligible for State inspection and this bill would allow for
that. The very small plants who produce specialty niche market
products, such as award-winning Kansas beef--we have got some
Kansas beef right here--or jerky from--this is the maple cured
M&J jerky from Vermont, and here we have got Manly Meats
sausage links from Indiana. These are winners with the passage
of this bill.
Interstate shipment will allow these State plants to reach
new markets and to engage in new and innovative methods of
marketing, such as mail order or e-commerce over the Internet.
So this bill would allow these small plants to better compete
with plants that are Federally inspected.
I think the consumer is also a big winner here. Consumers
would be able to enjoy a greater variety of safe meat and
poultry products like those that I just mentioned. With the
current prohibition in place, you or I here in Washington
cannot enjoy the many specialty products produced under State
inspection. However, once this bill passes and becomes law, not
only would every American be able to enjoy these and other
State-inspected products, but people from around the world
would be able to enjoy these products since they would be
eligible for export, and they will be able to do so with the
assurance provided by the USDA mark of inspection.
Small producers will also win because they will have more
local plant options for delivering their animals. In some
regions, small farmers and ranchers have to transport their
animals over long distances. Even Federally-inspected plants
will benefit because they are often suppliers to these small
and very small plants that buy their product and then add value
to those products.
The Federal program and the State programs are winners,
too. Greater coordination between Federal programs and State
programs will ensure the consistent application of policy and
enforcement. Importantly, the higher degree of coordination
will ensure that the expertise will flow both ways, maximizing
the use of talents available in a national inspection system.
The interstate shipment debate, as we have heard, has gone
on long enough. Back in the early 1980s, when Senators Daschle,
Dorgan, and Roberts were members with Secretary Glickman on the
House Committee on Agriculture, then-House Subcommittee
Chairman Harkin held hearings on this subject, and this was a
decade after the debate on the issue had begun.
Senator Harkin. Was that in the last century or what?
[Laughter.]
Mr. Rominger. A long time ago. So we think the time is
right. HACCP has been successfully implemented. We have a
balanced bill addressing concerns of processors, consumers,
State regulatory authorities, USDA, and the industry, and this
bill has been introduced. It is time to pass this interstate
shipment bill.
Mr. Chairman, thank you for the opportunity to appear
before you this morning and I look forward to working with you
in passing S. 1988 so that we can move to a seamless national
food safety system. We will be happy to answer any questions
that you or other members of the Committee may have. Thank you.
[The prepared statement of Mr. Rominger can be found in the
appendix on page 43.]
The Chairman. Thank you very much, Mr. Secretary. It is
appropriate you had the historical reference of our members
during their House service. I think already it has been
mentioned, by Senator Daschle, I think, that the issue has been
with us for 20-years. I can recall each of the conferences
during that period of time in which this issue has arisen in
one form or another from one house or another and it is
appropriate at this point, because we do have the ranking
member and the Chairman of the Subcommittee that heard this
bill in the last century.
[Laughter.]
Tom, would you like to proceed with your opening comments
or your questions?
Senator Harkin. As soon as I sit my cane down back here, I
will be set.
[Laughter.]
STATEMENT OF TOM HARKIN, A U.S. SENATOR FROM IOWA, RANKING
MEMBER, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
Senator Harkin. Thank you, Mr. Chairman, and I apologize
for being late. I had to testify before the Armed Services
Committee this morning and I just got out of that. I will just
ask that my statement be made a part of the record.
The Chairman. It will be included in full.
Senator Harkin. I just want to make sure that I welcome
Jolene Heikens of Triple T Meats in Wellsburg, Iowa, who has
come here today and I look forward to her testimony. We have,
as I am sure you do in Indiana and I know you do in South
Dakota, Senator Daschle and Senator Johnson, a lot of these
small plants that really provide a good source of revenue, they
employ people, they produce a great product. Especially if you
are in the corner of a State where you are bordering two other
States and your market sort of is right over there but you
cannot do anything, it really works a terrible hardship.
I think what we have here is a good approach on this to
ensure that these plants meet all of the requirements of HACCP
and meet the requirements of Federal inspection, even though we
can deputize the State inspectors. So I think we have a good
seamless system here now that we can bring these small plants
into the national system.
With that, I thank you very much.
The Chairman. Thank you very much, Senator Harkin.
[The prepared statement of Senator Harkin can be found in
the appendix on page 50.]
The Chairman. I will ask my questions last so that we get
as many Senators in before the vote. We are now advised the
vote will be about 10:40, so that gives us a little bit more
time.
Senator Daschle, do you have questions of the witness?
Senator Daschle. Mr. Chairman, I will be brief, but first
of all, let me compliment Secretary Rominger for his excellent
statement. We appreciate his presence here today. He said a
couple of things that I think we ought to elaborate on, if we
could just a little.
One intriguing statement was that you actually encourage
State-inspected plants and you want to see more of a State role
and State involvement. Could you elaborate a little bit on why
you think that is important?
Mr. Rominger. We think it is important because the States
know their local small plants and we think they are in a good
position to be able to do a good job of inspecting those
plants, and now that we have a national seamless system, why,
we will be able to guarantee the consumers that those small
State-inspected plants are up to the standards of Federal
inspection and, in fact, will carry that Federal inspection
stamp in addition to the State stamp, if the States still want
to use that. So we think that would give the States an
opportunity to put their State stamp on it as well as the
Federal stamp.
Senator Daschle. You also mentioned that this legislation
could enhance food safety because of the food testing
provisions. I would be interested, if you could, to elaborate a
little bit more on that, especially as it relates to
salmonella. Why is this a better food safety law than we might
have otherwise had?
Mr. Rominger. We have, as you know, recently instituted the
salmonella testing, and perhaps one of my colleagues will
elaborate on that, but we think that, that is important to make
sure that all of these plants are testing for salmonella. USDA
would continue to take the samples not only in the Federal
plants but in the State-inspected plants, as well, and analyze
them so that we would be able to assure consumers that those
plants are meeting the salmonella requirements, as well, and we
think that is important because salmonella is one of the
pathogens that has caused sickness in a lot of people.
Senator Daschle. And that is not happening today, correct?
Ms. Glavin. Under HACCP, we do have plants where we test
for salmonella. We have been doing that now for 3-years. The
overwhelming majority of the plants, over 90-percent, have been
able to meet the salmonella performance standards, which is a
real tribute to those plants. They have stepped up to the plate
and really taken charge. We think that having a single set of
salmonella sampling, in other words, done all by the Federal
Government, will enhance the safety of the product and will
enhance consumer confidence that all plants are being held to
the same standard. This has been a big success.
Senator Daschle. Could I finally ask, obviously, a lot of
groups, consumer groups, producer groups, processor groups, all
have an interest in this. I appreciate your efforts to reach
out to all of them to try to reach a consensus. Could you give
us your appreciation of that effort? Was everybody included in
this consensus making effort in the beginning and how do you
feel about the role that all the groups have had in getting us
to this point?
Mr. Rominger. I will ask Caren to elaborate, but yes, we
did include everyone who was interested and wanted to come to
the discussions that were held, and, of course, our Advisory
Committee also reviewed this process extensively. So we think
everyone who was interested was included.
Caren, do you want to elaborate on the amount of work that
went into that?
Ms. Wilcox. The National Meat and Poultry Advisory
Committee, the Advisory Committee to the Secretary, did discuss
this on numerous occasions. They looked at various work plans
for the legislation. They made suggestions about changes. Those
discussions--our meetings, of course, are public and were well
attended by both the members and also those that are not formal
members but they were perfectly able to make comments at that
time. So there were several public discussions and extensive
other discussions.
Senator Daschle. Mr. Chairman, I have to say the Department
has just been very, very helpful and cooperative in this whole
effort. As was just noted, I think the outreach here to try to
ensure that we have addressed the concerns and the priorities
of all groups has really been a remarkable effort. I applaud
them and I thank them for their participation and certainly
appreciate their testimony this morning. Thank you.
The Chairman. I thank the Senator.
Senator Fitzgerald.
Senator Fitzgerald. Thank you, Mr. Chairman.
I neglected to congratulate the minority leader for his
help and his lead sponsorship here. In my enthusiasm to thank
Senator Hatch, I neglected to mention that you were the lead
sponsor. While we are of different parties, I have enjoyed
working with the minority leader on issues of importance to
farm country out there.
Mr. Rominger, thank you for addressing that issue about the
consensus building process because I have noticed that there
are a list of four organizations that opposed the legislation.
I am glad you have attempted to work at the USDA with all
interested parties.
I have a little bit of a different question. I am wondering
if the USDA has estimated the cost of implementing this
legislation and does the President's or the current budgets
that are floating out there right now being debated on the
floor of the Senate, do we have appropriate levels of funding
for the Food Safety Inspection Services to take on this new
role?
Mr. Rominger. Yes, we do. The FSIS 2001 budget includes a
request for $1 million to cover the increased cost that would
be associated with the comprehensive reviews of all the State
programs. As far as the reimbursement from 50-percent to 60-
percent, if all of the States opted for that, that would add an
additional $8 million in payments to the States, but that will
not be needed until fiscal year 2002, but we would request that
at that time.
Senator Fitzgerald. So you think the States are in a pretty
good position, too? You are saying there is going to be an
increase in the amount of sharing of the expenses from 50- to
60-percent?
Mr. Rominger. Yes. This bill allows for that.
Senator Fitzgerald. That is good. So the States should be
in pretty good order, too. And if they are not, they probably
will have trouble with you, I would imagine, because you have
to approve the systems they have in place.
Mr. Rominger. Well, the States, the 25 States that have
programs now are operating under a 50-percent reimbursement, so
we think this just will help them.
Senator Fitzgerald. Thank you. You did touch upon this
briefly in your testimony, but I just wondered if you could
update the Committee a little bit more expansively on your
progress in implementing the HACCP systems, the Hazard Analysis
and Critical Control Point systems, in both the Federal and
State-inspected plants.
Mr. Rominger. As we have indicated, we have been through
this process now. It was a 3-year process. First, we had the
large plants that came on January 1, what would that have been,
1998, and then we had the medium-sized plants and small plants
on January 1, 1999, and now in January 2000, the very small
plants have come under the HACCP regulation. We have seen a
huge majority of those plants meeting their HACCP requirements,
have their HACCP plans in place, and are doing a good job. So
we think that now is the time to include all of them in this
State and Federal inspection system. But they have done a good
job.
Maggie, would you like to comment?
Ms. Glavin. I would only like to add that this past year,
when we brought on the very small plants, a large number of
those were State-inspected plants and the States did a
wonderful job of bringing those plants along. These are the
very small plants, fewer than ten employees, and we and the
States worked very closely together to make sure that they were
prepared.
Senator Fitzgerald. Thank you very much.
The Chairman. Thank you very much, Senator.
Senator Johnson.
Senator Johnson. Yes. I want to second the comments made
about appreciation, not only for being here but for the work
that you have done to build a consensus among so many different
players who have an interest in this reform. I think we need to
do more of that in general in Congress, frankly, but in this
particular instance it is very, very welcome.
You observed about how we are enhancing our meat safety
inspection with the implementation now of HACCP and the
salmonella testing and so on, but, in fact, the track record of
State-inspected meat products, even before that, how would you
characterize it? We are starting from what, in fact, was a very
high level in the first place is my understanding. Is that a
fair characterization of our State-inspected meat plants, by
and large, in the past?
Mr. Rominger. Yes. Yes, I think so. I think the States have
done a good job in the past. We think that this will assure
consumers and assure our foreign trading partners that they are
equal, they are the same as the Federally-inspected plants. So
there would be even more confidence.
Senator Johnson. Do you anticipate any resistance from our
trading partners, having evaluated this new approach in the
U.S.?
Mr. Rominger. No, I do not.
Senator Johnson. Good. When you talk about increasing our
cost share from 50- to 60-percent and then ultimately an $8
million increase, a very modest level when you think of a
national effort such as this, what is that added increment
designed to enable the States to do? What is the rationale for
the 50- to 60-percent and how will that $8 million assist the
States?
Mr. Rominger. Well, there may be some added costs to the
States in their coordination with the Federal Government,
making sure that our inspectors and their inspectors keep up to
date on all the training that goes on. So there may be a little
added expense for States in being part of this seamless system,
so we thought that this would be a way to compensate them for
that.
Senator Johnson. Do you anticipate that there will be an
overwhelming positive response from these 25 States that have
State inspection systems?
Mr. Rominger. I think so. Caren, do you have any comment?
Ms. Wilcox. We certainly believe that probably all of them
will be very enthusiastic about it.
Senator Johnson. And you anticipate additional States may,
in fact, as well, join in with State inspection systems?
Mr. Rominger. Have we had any?
Ms. Wilcox. There are provisions in the bill for them to
come in and we would hope that there would be. We have some
indications from some States that they are interested in the
new program.
Mr. Rominger. Because there are some States that have given
up State inspection in the last few years and they may be
interested now in getting back in.
Senator Johnson. Again, I appreciate your testimony here
today. I think there is a lot of enthusiasm among the American
public as well as producers on this issue, and again, your work
to really put us in a position now to finally begin to
implement this reform, I think is very welcome and badly
needed. Thank you.
The Chairman. Thank you, Senator Johnson.
Senator Lincoln.
Senator Lincoln. Thank you, Mr. Chairman, and I, too,
appreciate your availability here today. I just have a couple
of questions.
I do not think anyone in the room will disagree with the
fact that our agricultural community today faces a variety of
struggles on a daily basis, and one of the top ones is truly
trade barriers. Senator Johnson asked a few questions about
that. You answered with a no, that you felt pretty confident
that we would not have any problem with our trading partners,
but I cannot help but imagine a scenario where you have a
product that is inspected in, say, a State like Oklahoma, maybe
shipped to Louisiana, where it is further processed into a
Cajun sausage, and then shipped to Europe.
I just wonder if our trading partners are going to be
willing to deal with each of those individual inspecting
systems through the various States. From your previous answer,
I can only assume that it is that you maintain that S. 1988
would not violate any current international trade agreements,
is that correct, Mr. Rominger?
Mr. Rominger. That is correct, and we think that our
trading partners will accept this because that Federal stamp
will be on the product that is inspected by the State plants
because they are meeting Federal inspection requirements.
Senator Lincoln. That just kind of leads me to, and we talk
about the 25 States that have State inspection systems are very
pleased with this legislation. I thought it was 26, I guess.
There are 24 States that do not, is that correct, that do not
have State----
Mr. Rominger. No, we have got 25.
Ms. Wilcox. One dropped out recently.
Senator Lincoln. The numbers do not matter. I am just
saying that there is another side to that coin. There are the
other 25 States that do not have State inspection systems. When
you mention that, if, in fact, they are meeting Federal
guidelines, why would it be--I do not know that they would not
want to be Federally inspected.
Mr. Rominger. Why would not the small plants want to be
Federally inspected----
Senator Lincoln. Because of the cost?
Mr. Rominger.--instead of staying with the State program?
Senator Lincoln. Yes.
Ms. Glavin. Certainly at our public meeting back in 1997 in
Sioux Falls, we heard extensively from small producers about
their desire to continue to work with State people who were
much closer to them, who were much more available than the
faceless people in Washington, is what they would call us. I
think I became convinced certainly in that meeting that the
very small plants, these plants that have a small number of
employees, often are family owned and family run, are better
served by a government agency that is closer to them, that
knows the community, that knows them, is able to get to them
faster.
That was the basic reason, because we kept asking that
question. Why not come under Federal inspection if you want to
ship interstate? Universally, that was the answer. I know the
people in the State. They respond to me. They respond to my
phone calls.
Senator Lincoln. Well, in terms of leveling playing fields,
I definitely think that is important, but you have States that
have opted not to do a State system because they chose to do
the international trade, or to trade across State lines and
internationally.
If, in fact, that Federal stamp is over the State stamp,
does that mean that the Federal Government assumes the
liability and the responsibility?
Mr. Rominger. It would be the same as any other Federally-
inspected plant now. The Federal inspection is on it, which
means that we are assuring consumers that, that is a safe,
wholesome, healthy product.
Senator Lincoln. So you do assume the liability and the
responsibility of that. Well, then can you just describe how
the State-inspected facilities would have to comply with the
FSIS, the regulatory requirements?
Ms. Glavin. First of all, they would be required to adopt
all of the requirements of both our legislation and our
regulation and they would have to enforce those in the same way
that we do. They do that today. They have equal to. But they
would have to have the same laws and regulations and enforce
them as we do.
Senator Lincoln. So it almost sounds like the Federal
Government wants to get out of meat inspection.
Ms. Glavin. No.
Senator Lincoln. No?
Ms. Glavin. I would not go that far.
Senator Lincoln. But, I mean, if, in fact, you take the
liability but allow the State to do it as long as they comply
with your guidelines, then it is kind of like was mentioned
earlier, the deputizing, apparently, of State inspection
systems.
Ms. Glavin. We would continue to have oversight of those
State systems, including yearly reviews of them, and as has
been mentioned, we will do the salmonella performance standard
testing, which would be an ongoing check that, in fact, things
were operating properly.
Senator Lincoln. The number that you mentioned on that
salmonella testing, the 90-percent compliance, I guess, or
positive results from that, were those all Federally--I did not
understand your answer. Those were all Federally-inspected
facilities, right----
Ms. Glavin. Those are Federally inspected.
Senator Lincoln.--not State-inspected facilities.
Ms. Glavin. That is what is in our database, yes.
Senator Lincoln. Right. So then what you would be hoping
would be if they comply with all of your standards and
requirements, then those State facilities would meet that 90-
percent level, hopefully, as well?
Ms. Glavin. The 90-percent was 90-percent of plants are
meeting the standard, and all plants are required to meet them.
It is clear that plants are stepping up to the plate and doing
that. The States----
Senator Lincoln. Those are Federally-inspected plants,
correct?
Ms. Glavin. The ones that my data refers to are Federally,
yes, but the State plants all have the same requirement.
Senator Lincoln. They do now?
Ms. Glavin. Yes.
Senator Lincoln. OK. Do you know if they are meeting that
same----
Ms. Glavin. Yes, they are. I do not know the exact
percentage of plants that are meeting it, but I would assume it
is in the same area of 90-percent.
Ms. Wilcox. Most of the small plants, the very small
plants, have just come into the program and therefore the
database is not complete as to the salmonella sets for the very
small.
Senator Lincoln. I just had a few concerns and wanted to
make sure that I had those expressed and would like to maybe
visit with you further on some other questions that we may
have.
Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Lincoln.
One concern of critics of the bill has been phrased in this
way. Under this bill, would all State-inspected plants have to
comply with all USDA directives, notices, and policy
memorandum? Was that the intent of the proposal as prepared for
transmittal to Congress?
Mr. Rominger. Yes.
Ms. Glavin. Yes.
Ms. Wilcox. It is our intent, yes.
The Chairman. Under this bill, would States still be able
to require and to pay for inspection of all meat species? For
example, in Indiana, inspection is required for farm-raised
deer and elk, bison and ostrich and emu, and there are a few
plants in the State that slaughter these species. Is the
legislation comprehensive in that way and what comment can you
make about all meat species?
Ms. Glavin. That would continue to be allowed, although as
is the case today, there would be no Federal payment for that
part of a State's program.
The Chairman. I see, no Federal payment there. So the
States could do it, but they have to assume total payment
there?
Ms. Glavin. Right, and that is the case today.
The Chairman. There would still, however, be the dual
stamps, both the Federal and the State stamps?
Ms. Glavin. No, only on product covered by the Federal Meat
and Poultry Acts.
The Chairman. So on, for instance, the farm-raised deer,
this is a State responsibility and the State stamps it and pays
for it?
Mr. Rominger. Unless the Federal Meat Inspection Act is
changed to include them.
The Chairman. The bill allows USDA to reimburse a State for
up to 60-percent of the costs. The bill also requires a
comprehensive Federal review of State inspection programs to
determine their effectiveness of each program, identify changes
that are required. Is it possible that changes could be
required that would substantially increase the cost to the
State of this process, even with the higher Federal
reimbursement?
Ms. Glavin. I think the one area where there could be
additional cost is if additional small plants decided to move
over to the State system, that could add to the States' costs.
They would need additional inspectors, etc.. So there is the
possibility that their cost could increase.
The Chairman. And it is in that area that the States are
likely to incur costs? In other words, if you are a State and
you are taking a look at this and you wonder, granted, the 60-
percent reimbursement is more generous, but am I going to be
required to do a lot of other things that lead to my costs
being higher.
Ms. Glavin. That is part of the reason for allowing States
in this bill to set a size limit on the plants that they would
be willing to take into their program so that they have some
way to control their cost.
The Chairman. Now, in response to other Senators, you have
commented you do not anticipate difficulty with regard to our
trading partners abroad. I am just curious, have any inquiries
gone out from the Department to any of these markets or any
other countries? Are they aware that this legislation has been
drafted by USDA, offered by distinguished Senators, and do you
have any official reaction from them?
Mr. Rominger. Caren?
Ms. Wilcox. I know that they have been informed because
USTR and FAS have reviewed this bill and there have been
notices, but I do not know of any formal responses. We do know
that some of our meetings have been monitored by
representatives of other governments.
The Chairman. And they have made either favorable comments
or no comments or how would you characterize it?
Ms. Wilcox. No formal comments.
The Chairman. Now, 25 States are covered on your chart by
both State and Federal programs presently. Are more States
likely to join this process, and do you have any evidence, any
comment as to what kind of decisions might be made by States
that do not have programs presently?
Mr. Rominger. I do not think we know for sure whether any
States will decide to go back to adopt a State-inspected
program because it does incur costs for a State that does their
own program because the Federal Government will only reimburse
under this bill up to 60-percent of their costs. So there would
be additional costs for the States if they decide to do their
own program.
The Chairman. Is that your view as to why many States have
not adopted State programs, because it does have an added cost
to it and, therefore, they have just simply been a part of the
Federal business from the beginning?
Mr. Rominger. I think that is a major cost, major reason,
yes.
Ms. Glavin. There is some movement over the years in and
out of the program, and in the past few years, the two States I
remember that have dropped the program were Florida and Alaska,
and in both cases it was for financial reasons caused.
The Chairman. And presumably, they did not have additional
meat products that were outside the Federal bounds. I mentioned
the Indiana situation of these additional species. That might
be a justification for having a State program, if you had
additional items that you wanted to certify.
Ms. Wilcox. Yes. If you had an industry with non-amendable
species, yes.
The Chairman. Senator Harkin, do you have further
questions?
Senator Harkin. Mr. Chairman, I just have one. I think you
and others have covered this waterfront pretty thoroughly. I
just have one just a little bit different than this, Mr.
Rominger. I wrote a letter to Secretary Glickman on March 27.
It has to do with the reduction of 197 inspector years
contained within the USDA's budget for next year. I am very
disturbed by this, as a matter of fact, and why that is in
there. Here we are talking about inspections, and yet the USDA
in their own budget is asking us to reduce by 197 inspector
years, and yet we just recently had another outbreak of
listeria, as you know.
So I am really disturbed by this and I hope that you will
take this back to the Secretary and ask him please to take a
look at the letter I wrote just the other day. I really believe
that you are doing this without soliciting any public comment.
I really think that before any changes are made in the
inspection process, I really do think you need to go through an
open rulemaking just as you would for any changes in slaughter
inspection. That was sort of the content of my bill.
I do not need you to reply to that, but please take this
back to the Secretary and let him know that we need to really
discuss this because the last thing we need is a reduction in
inspectors, I think, out there. If you want to comment on that,
I would be glad to hear that.
Mr. Rominger. We appreciate and we understand your
concerns. Certainly, the Secretary will be responding to your
letter. I will ask my colleagues to amplify about that, but I
would just add that, currently, we have funds in the budget for
additional inspectors and we have an aggressive recruiting
program underway right now to add some additional inspectors in
this fiscal year.
Senator Harkin. So you are adding them this year and
cutting them next year.
Ms. Glavin. We do intend to, for slaughter inspection, do a
full notice and comment rulemaking process for any changes
there, and we are also committed to a full public process on
making any changes in the frequency of processing inspection.
Senator Harkin. I have to tell you, Ms. Glavin, through all
my years here, I do keep fairly open doors to a lot of
producers around the country, large and small, and I am hearing
more and more complaints about the fact of the lack of being
able to get a Federal inspector, and then I get hit with this
budget of 197 reduction and I am wondering, what is happening
here? I do not understand this. Do you have any other comment
on that? I do not understand it.
Ms. Glavin. Well, no. As the Secretary indicated, we have
had a very aggressive recruiting program this year and we have
seen some success in increasing the number of slaughter line
inspectors and we are committed to continuing that.
Senator Harkin. Maybe we can work this out, but maybe you
can enlighten me more as to why that was in the budget.
Ms. Glavin. Yes.
Senator Harkin. Thank you very much.
Mr. Rominger. We would like to continue the discussion with
you on that issue.
Senator Harkin. I appreciate that. Thanks.
Senator Lincoln. Mr. Chairman, can I just ask them to
qualify an answer to the Chairman's question? In discussion
about having presented the proposal to USTR, you did not get a
formal response from them?
Ms. Wilcox. Oh, no, from them, but there is a process that
they have once a bill is introduced that could have
implications in international trade that they have.
Senator Lincoln. I just want to make sure that I
understand. I realize that you have no----
Ms. Wilcox. No. USTR fully oversaw this bill----
Senator Lincoln. And supports it?
Ms. Wilcox.--and the administration as a whole supports
this bill.
Senator Lincoln. So USTR, they fully support it?
Ms. Wilcox. They reviewed this bill----
Senator Lincoln. It is just the other countries that you
are saying?
Ms. Wilcox. Our understanding of the Chairman's question
was, did other countries know about the bill, and there is a
process for informing them about it.
Senator Lincoln. You have gotten no formal comment from the
other countries----
Ms. Wilcox. We have no formal comment that I know of from
them.
Senator Lincoln.--but you have a formal endorsement from
USTR?
Ms. Wilcox. Yes. There was a full review by USTR, yes.
Senator Lincoln. I just wanted to make sure I was correct
on that.
Ms. Wilcox. Thank you for clarifying the record.
Senator Lincoln. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Lincoln.
We are concluded with this panel, which is fortuitous. You
can go back to work. But we appreciate very much Secretary
Rominger, Ms. Glavin, Ms. Wilcox and will return after these
votes and have a distinguished panel.
Mr. Rominger. Thank you, Mr. Chairman.
The Chairman. For the moment, the hearing is recessed.
[Recess.]
The Chairman. The hearing is called to order again. We
thank you for the patience that you have displayed already as
our witnesses. We look forward to hearing from each one of you.
Let me introduce the panel who have assembled. They are
Fred L. Dailey, the Director of the Ohio Department of
Agriculture and President of the National Association of State
Departments of Agriculture from Reynoldsburg, Ohio; Michael
Eickman, Eickman's Processing Company, Incorporated,
representing the American Association of Meat Processors, the
Illinois Association of Meat Processors, and 18 other State
meat processing associations, from Seward, Illinois; Jolene
Heikens, Triple T Country Meats, representing the American
Association of Meat Processors, the Iowa Association of Meat
Processors, and 18 other State meat processing associations,
from Wellsburg, Iowa; Harry Pearson, President of the Indiana
Farm Bureau, representing the American Farm Bureau Federation,
from Indianapolis, Indiana; Richard T. Nielson, President of
the Utah Cattlemen's Association, representing the National
Cattlemen's Beef Association from Salt Lake City, Utah; Carol
Tucker Foreman, Distinguished Fellow and Director of the Food
Policy Institute, Consumer Federation of America; and Patrick
Boyle, President and CEO of the American Meat Institute,
Arlington, Virginia.
We are delighted that you are all here. I will ask you to
testify in the order that I have introduced you. Please try to
summarize your comments in 5 minutes, more or less, and your
full statements will all be made a part of the record of this
hearing.
Mr. Dailey.
STATEMENT OF FRED L. DAILEY, DIRECTOR, OHIO DEPARTMENT OF
AGRICULTURE, PRESIDENT, NATIONAL ASSOCIATION OF STATE
DEPARTMENTS OF AGRICULTURE, REYNOLDSBURG, OHIO
Mr. Dailey. Thank you, Mr. Chairman. Thank you for the
introduction, as well. I did not have it on my resume, but I
did serve 6-years as Director of the Indiana Division of
Agriculture during the 1970s, so I am almost a Hoosier.
The Chairman. Indeed, always a Hoosier.
[Laughter.]
Mr. Dailey. But I am also responsible for a State meat
inspection and poultry program which oversees 215
establishments in our State and I have with me today Dr. Lee
Jan, Director of the Meat Safety Assurance Division of the
Texas Department of Health, and he is President of the National
Association of State Meat and Food Inspection Directors. We
thank you for the opportunity to speak here today.
I am here on behalf of all the States to support the
approach embodied in this bill, which would lift the unfair ban
on interstate shipment of State meat and poultry products. This
is a subject of extreme importance to State Departments of
Agriculture and the time to act is now. The reasons to act are
clear, simple, and, I think, very compelling.
Because of our long history of oversight and compliance
with the ``equal to'' inspection requirements of Federal law,
the States have never viewed this question of removing
interstate shipment as a food safety issue. In fact, we are
very, very proud of our food safety record.
Some of you may wonder why we have 25 States with their own
State meat inspection programs. Who are we serving? Our mission
is to provide consumers with wholesome, unadulterated products
that are properly labeled and safe. State programs are geared
to regulating small and medium-sized businesses. Our personnel
are generally more accessible and more flexible in providing
inspection resources that are geared to the needs and timing of
small plants that are not running three production shifts per
day working five or 6 days per week. State programs also
provide practical information and technical assistance and our
overtime inspection fees are considerably less than Federal
rates. In Ohio, for example, it is $18 an hour versus $47 an
hour for the USDA.
We are geared to working with and supporting businesses
that cannot afford to employ a scientific staff or attorneys to
sort through all the regulations in searching for answers. We
provide a direct line of information sharing and decision
making that is accessible to small businesses much more easily
than the multi-layered chain of command and the frequently
adversarial attitude of the larger Federal system. So we feel
there is definite need for existing State programs to continue,
and if this legislation passes, you are more likely to see
additional States adopt programs.
Now, the question before you this morning is whether to
change, whether to level the playing field and provide the same
opportunities for all meat and poultry processors, or to
continue the Government sanctioned economic advantage for large
corporations and foreign competitors at the expense of small
businesses.
As I was preparing my testimony, I looked back to testimony
I gave back in 1996, almost 4-years ago, and I began wondering
how many of our small processors we had lost in that time. I
went back and counted and it was 41 different plants that we
have lost. We have also had a number of small cattle ranchers
and hog farmers that have not been paid competitive prices and
there have not been as many opportunities for price discovery.
If you go to a livestock auction, they used to be crowded
affairs with a lot of packer buyers. Now, there is one or two
and you almost sense that you take this lot and I will take
that lot.
Mr. Chairman, quite a lot has not changed since the 1996
hearing, and yet quite a bit has changed. That presents us with
new opportunities. First, let me tell you what has not changed
over the years and why this issue is so important to us.
Most importantly, small meat processors under State
programs are still denied many opportunities to sell their
product today because they do not have full access to the U.S.
marketplace. Many of these companies make and market specialty
products, like sausage, bratwurst, jersey, and ethnic meat
products often made from old world recipes which are not cost
effective product lines for large operators but for which there
is clearly a demand. Repealing the ban would provide consumers
with more choices in the supermarket and convenience stores.
It has always struck us as both unfair and illogical to say
that consumers in one State may enjoy meat product while
consumers in another State may not meet that same product. I
choose the word ``meat product'' carefully because this is the
only State-inspected product that cannot be shipped interstate.
You heard the difference between buffalo and beef and we have
beefalo, which is actually five-eighths beef and it has to be
inspected because it is more beef than it is buffalo. You can
actually cross-breed the two. But it is illogical when you get
down and look at the absurdity of it all.
Maintaining the interstate ban prevents small businesses
from capitalizing on other sales opportunities, such as niche
marketing through mail order catalogs, the Internet, and we
even have a situation in Ohio and Indiana where we have Union
City. You can sell product on one side of the street, but you
cannot cross this street and sell it on the other side.
In my State, Ohio State University recently did a study and
they found that lifting the ban would mean an additional $56
million to our State economy and create almost 600 new jobs for
our State.
The second thing that has not changed is the unfairness of
the ban. You have heard about the large packing conglomerates,
but particularly I think it is very unfair with the foreign
competition. The trade agreements allow foreign inspected
product to be shipped anywhere in the United States so long as
that foreign inspection program is equivalent to the U.S.
Federal standards, in practice, the same standard which the
State must meet. If any of our State-inspected plants were
located in Guatemala, Mexico, Australia, they could ship
anywhere in the United States. But because they are not, they
are restricted to intra-State marketing.
As you have heard, the Secretary has three Advisory
Committees which has now recommended that HACCP is fully
implemented in the small plants.
The third major thing that has changed is that we finally
have the administration on board supporting our effort. While
the legislation may not be perfect, it is something that will
work and it would move us even closer to a uniform national
inspection program. The bottom line is that today, there are
now meaningful distinctions between Federal and State
inspection programs which justify perpetuating this unfair ban.
I want to thank the administration for putting this concept
on the table. It is billed as a consensus bill. Some of us feel
like we have not had as much input as we would like, but we do
believe that the true consensus is very close, Mr. Chairman.
With a little work by the Committee with all the interested
stakeholders and all the issues, we can reach a reasonable
accommodation that maintains all the essential elements of the
USDA concept.
I would like to challenge my colleagues in the food,
consumer, and agriculture communities who are here this morning
to commit to working these remaining issues out, getting a bill
passed, not believe that keeping the status quo is in the best
interest of anyone.
So we all have a reason to remain engaged in the process
and see this bill through to completion. Our NASDA members and
the constituents we serve hope that Congress will act this year
to remove this unfair ban and competitive barrier to small
businesses. Thank you, Mr. Chairman.
The Chairman. Thank you, Mr. Dailey.
[The prepared statement of Mr. Dailey can be found in the
appendix on page 52.]
Mr. Eickman.
STATEMENT OF MICHAEL EICKMAN, EICKMAN'S PROCESSING CO., INC.,
REPRESENTING THE AMERICAN ASSOCIATION OF MEAT PROCESSORS, THE
ILLINOIS ASSOCIATION OF MEAT PROCESSORS, AND 18 OTHER STATE
MEAT PROCESSING ASSOCIATIONS SEWARD, IL
Mr. Eickman. Thank you, Senator Lugar and members of the
Committee. My name is Mike Eickman. I own and operate Eickman's
Processing Company, Incorporated, in Seward, Illinois. I
presently employ 25 men and women in a small State-inspected
meat packing facility. We do slaughter and complete processing
from farm to table as well as wholesaling and catering. We are
located 25 miles from the Wisconsin border.
I am speaking on behalf of myself and the State-inspected
processing plants across the country representing the American
Association of Meat Processors and the Illinois Association of
Meat Processors. These organizations and I strongly ask and
urge the Senate bill and interstate shipment be favorably
considered and passed. This legislation will help smaller
processors economically and finally allow them to compete in
free trade, which has been restricted through invisible
barriers called State lines for too long.
There are presently 25 States that have State inspection
and they have State inspection because their State legislatures
feel that meat products within their States should be inspected
so that the consumer will have a wholesome meat product. The
Federal system does not require inspection for custom
slaughtered products that are the property of the local farmers
and sold to his customers.
Currently, the Federal Government assists States with
funding for their programs and requires these States to
recognize and follow USDA and FSIS regulations. If a State does
not meet these requirements, then the USDA can intervene and
may take over the State's program. This would then mean that
Federal inspectors would be required to inspect in those
programs so that the products may be sold.
Since this HACCP was installed, requiring the State
inspection systems for them to continue to get funding, I feel
that States should be awarded the opportunity to ship in
interstate commerce if they so desire. It would not be a
program that everyone would necessarily have to participate in
but could be available for those qualified and willing to
follow the regulations set down by the USDA and State
officials.
Secretary Glickman was asked about interstate shipment at
our convention in Louisville, Kentucky, several years ago and
he said that it could not happen unless the HACCP system was
implemented and in place. Now that system is in place and
operating.
I have been asked why my plant never went Federal for
inspection and there are several reasons. In the early years,
in 1967 when the Wholesome Meat Act was enacted, we were busy
with doing custom processing. Over the years, this has changed.
Now there are fewer farms with livestock and the larger feeders
direct their livestock to larger packers away from our
facilities. We also felt that the Federal system did not want
to hassle with small facilities due to the lack of personnel
and necessary funding to pay for added inspectors.
Today, we still wonder if the system wants small plants.
Illinois has nine State plants that have applied for Federal
inspection and 12 more are in the process of looking into it
and going Federal. Currently, none of these have received a
response from the circuit supervisor, and that was as of last
week. I even had a Federally-inspected plant operator tell me
that his inspector told him he wished this bill would pass so
that they could give the smaller plant back to the State. This
would allow the Federal inspectors to concentrate on the larger
facilities.
Another reason is the method of communications the State
uses to solve problems. We do not have the pile of red tape to
work through to solve a problem. Just a few phone calls and the
problem can be solved. We also have heard of the horror stories
that the larger plants have for trying to get something solved
on the Federal system and it can be a real task to accomplish
something.
In our plant, we also process and inspect exotic animals.
These are inspected and can be shipped anywhere in the world
and across the State lines. However, beef, pork, and lamb are
restricted by the inspection system. Our exotics are inspected
the same ways by the same inspector and we just have never
figured out why.
This is not a food safety issue. It is an economic issue
concerning small State-inspected operations and they need a
chance to expand our market base, move freely in interstate
trade. The passage of legislation will not lower the quality of
inspection but will enhance the quality of products available
to the customer. We have customers waiting for our products but
we cannot ship over that interstate fence and it is a bill that
is really needed.
Once again, I ask you to look favorably upon this bill. It
is needed, wanted, and now is the time for the processors in
these States to kind of get some compensation for their
efforts. Please vote yes, and I sure appreciate the opportunity
to talk to you today.
The Chairman. Thank you very much, Mr. Eickman. We
appreciate your testimony.
[The prepared statement of Mr. Eickman can be found in the
appendix on page 63.]
Ms. Heikens.
STATEMENT OF JOLENE HEIKENS, TRIPLE T COUNTRY MEATS,
REPRESENTING THE AMERICAN ASSOCIATION OF MEAT PROCESSORS, THE
IOWA ASSOCIATION OF MEAT PROCESSORS, AND 18 OTHER STATE MEAT
PROCESSING ASSOCIATIONS, WELLSBURG, IA
Ms. Heikens. My name is Jolene Heikens and I am from
Wellsburg, Iowa. My husband and I own and operate Triple T
Country Meats. I am here today representing the Iowa Meat
Processors Association and the American Association of Meat
Processors.
Currently, State-inspected meat plants can only sell their
products inside their own State. We feel our businesses are
being discriminated against for no apparent reason. Last year,
our business had no choice but to turn down the largest beef
order we have ever received because we could not cross State
lines. Is the consistency there when I can sell a State-
inspected buffalo, deer, ostrich, emu, or elk all over the
United States and the State-inspected beef and pork have to be
sold within the State?
What is so special about beef or pork that they get a
mandatory free inspection? I can literally watch beef be State-
inspected the exact same way as a buffalo or any of the above-
mentioned animals and they could be marketed through the United
States. Why should these animals be governed under different
rules? Are we not as concerned about products made from these
animals as we are with our beef and pork products?
Interstate shipment is not a food safety issue. This is
about placing marketing restrictions on State plants who are
enforcing Federal regulations. Our State has spent hours
educating processors with the help of Dr. Joe Cordray, an Iowa
State University meat specialist. The Iowa Department of
Economic Development, the Iowa Meat Processors Association, and
Mike Mamminga are just a few that have supported this effort to
help implement HACCP.
Communication between plant owners and our State inspection
people have been a key component to the success of our State
inspection program. The ease of communication between State
inspection personnel and plant owners is something I probably
did not realize the benefits of or the importance until I was
faced with the frustration of wanting to expand. I had no
choice but to look at the Federal level because I had possible
clientele out of State.
After 2-years of working on writing a business plan and
applying for several loans and grants, I came to the point of
being ready to begin building. So I called the Federal office
in Des Moines and I asked for an appointment to jointly look at
our plans for our new facility. I was told that would make them
a consultant and they were not allowed to do that. They would
come after the plant had been built and ready to open. Then I
would be made aware of any deficiencies that needed my
attention. My goal here was to prevent any problems that could
arise after construction had become, and I certainly do not
want to be made aware of my deficiencies when I am about ready
to open a new facility.
I guess I am back to the ease of communication. I do not
mean easier terms of inspection purposes. I am talking about an
inspection service that is available not just to regulate but
who tries to participate and provide direction.
We are running a market-driven business which the State
inspection programs seem to have a much better understanding of
because they not only want to make sure our meat products are
safe to the consumer, State inspection is there to help and
provide answers and direction in a timely fashion.
In closing, I just simply cannot fathom why interstate
shipment should even be an issue. Our plants are enforcing
Federal regulations and we have done everything that we have
been mandated to do. There should not have to be frustrating in
wanting to expand to small business, especially when my
guidelines and regulations are equal to, and in some cases
better than those regulated in Federal facilities.
Therefore, I cannot find any valid reasons or laws that
should prevent interstate shipment of meat and poultry
products. Thank you for your time. And I am a Hawkeye and a
Cyclone.
[Laughter.]
The Chairman. I understand.
[The prepared statement of Ms. Heikens can be found in the
appendix on page 68.]
It is my privilege to introduce now a Hoosier, so it turns
up in the batting order.
[Laughter.]
I wanted to take this occasion of introducing Harry
Pearson, President of the Indiana Farm Bureau, to congratulate
him on presiding over the publication of a remarkable history,
80-year history of Indiana Farm Bureau, which we just received
and enjoyed enormously. It is good to have you, Harry, and
please testify.
STATEMENT OF HARRY PEARSON, PRESIDENT, INDIANA FARM BUREAU,
REPRESENTING THE AMERICAN FARM BUREAU FEDERATION, INDIANAPOLIS,
IN
Mr. Pearson. Thank you very much, Chairman Lugar. It is
certainly a pleasure to be here this morning and we appreciate
you holding this hearing. I tried to summarize my comments a
little bit in comparison to those that have been presented.
I am Harry Pearson, the President of the Indiana Farm
Bureau, and I live on a farm and farm in partnership with my
brother and our family. The American Farm Bureau certainly
appreciates the opportunity to make comments regarding the
interstate shipment of State-inspected meat. This is an issue
of great importance to our farmers and ranchers all across the
country.
We strongly support efforts to align and implement meat and
poultry inspection laws that would allow these products under
both Federal and State programs to be distributed in interstate
commerce. The mission of the Food Safety Inspection Service is
to provide appropriate regulatory safeguards and services to
ensure that all meat, lamb, and poultry products for interstate
shipment or foreign commerce meet food safety standards.
As State and Federal budgets become more and more limited,
it seems that the time is right for increased coordination
between State and Federal meat inspection programs. Many times,
the products inspected in a State-inspected facility are small-
volume specialty products, and quite often, those items
prepared by the small operators are not always economically
feasible for large-volume operators. The ability to ship
interstate could benefit livestock producers, small processors,
and consumers, and at the same time stimulate economic
development in rural communities.
As has been mentioned earlier, the four major packers
account for more than 80-percent of the fed cattle slaughter.
Fifteen-years ago, large packing houses only accounted for
about 36-percent of that volume. Farm Bureau members believe
that competitive pricing activities of the livestock industry
have been reduced due to the high concentration of processing
by the four major packers. Allowing State-inspected meats from
small and mid-sized processing plants to move interstate gives
them additional opportunities to expand their business.
In 1996, the USDA Packer Concentration Panel determined
that allowing interstate shipment of State-inspected meats
would provide additional competition in the marketplace. The
Farm Bureau has worked diligently for the passage of NAFTA and
GATT and that same type of effort is being applied toward the
passage of permanent normal trade relations with China. World
trade opportunities also increase our opportunities as we open
new markets.
We strongly believe in food safety and maintaining the
highest level of consumer confidence in our food safety. As has
already been mentioned, however, this debate is not about food
safety but is about our own U.S. processors having the access
to our U.S. markets on terms that are no more restrictive than
those that foreign exporters must meet.
Several years ago, we supported and worked closely with
Congress and the administration to pass the HACCP system into
law. HACCP is now fully implemented, with every meat processing
plant in this country operating under this scientifically-based
process. It is now time to further the coordination in meat
inspection and to incorporate interstate commerce for State-
inspected meats.
There is support from several individuals in our State
regarding S. 1988 and they are all supportive of its passage.
These individuals include our State veterinarian, Dr. Brett
Marsh, representatives from the State Board of Animal Health,
Dr. Paul Dieterlin, Administrator of the Indiana Meat
Inspection Program, and Mr. Jim Rihm, President of the Indiana
Meat Packers and Processors Association. Indiana has 101 State-
inspected plants and Mr. Rihm believes this legislation will
help the small packer to better compete in the specialty meats
products market.
I talked to a producer, a young producer by the name of
Greg Gunther, who also served on the Small Farm Commission that
was appointed by Secretary Glickman. He lives eight miles from
a State line and he has developed a niche market with specialty
products, but he has to go out of State to a Federally-
inspected plant to get his hogs processed and then take those
to Chicago. He also does some work with the State-inspected
plant but cannot move those products across the State lines and
estimated that, conservatively, that it has cost him about
$20,000 in income just because he has to go out of State to get
that inspection done.
The American Farm Bureau Federation encourages Congress to
support and pass S. 1988 and allow the Food and Safety
Inspection Service to take the necessary steps to facilitate
the movement of State-inspected meats across State lines.
Mr. Chairman, we appreciate the opportunity to appear
before you this morning and make comments.
The Chairman. Thank you very much, Mr. Pearson.
[The prepared statement of Mr. Pearson can be found in the
appendix on page 70.]
Mr. Nielson.
STATEMENT OF RICHARD T. NIELSON, PRESIDENT, UTAH CATTLEMEN'S
ASSOCIATION, REPRESENTING THE NATIONAL CATTLEMEN'S BEEF
ASSOCIATION, SALT LAKE CITY, UT
Mr. Nielson. Good morning, Mr. Chairman. Thank you for the
invitation to be here today and the opportunity to present this
testimony. I am Richard B. Nielson and I am the President of
the Utah Cattlemen's Association and a board member of the
National Cattlemen's Beef Association. I come from a small farm
in Central Utah that I operate with my brother and my son.
Interstate shipment of State-inspected meat is one of the
top priorities of Utah Cattlemen's Association, the National
Cattlemen's Beef Association, and the other producer groups
represented here today. Under current law, State-inspected
plants cannot ship beef, pork, lamb, or poultry across State
lines. This restriction limits the ability of these plants to
expand marketing opportunities and limits competition for
market animals. Current law also applies unequally to different
species in regards to State inspection programs. For example,
based on information provided by the Agriculture Committee,
there is no restriction on the interstate shipment of State-
inspected bison, venison, pheasant, and ostrich.
This bill would expand interstate shipment of State-
inspected meat to include beef, pork, lamb, and poultry. Meat
inspection programs would enforce the same inspection laws and
regulations enforced under the Federal program to create a
seamless national inspection system with the States retaining
the right to impose additional inspection requirements.
Products inspected under this authority would be eligible for
interstate shipment, export, and for use in products destined
for export.
I would like to share several reasons and anecdotes as to
why this legislation is justified and why the ban on interstate
shipment of State-inspected meat should be eliminated.
Elimination of the ban is good for small businesses. State-
inspected plants are typically family owned and operated small
businesses whose growth is limited to the markets in their own
State. Because their markets are limited, so is their ability
to compete with large corporate processors who have a worldwide
market. Removing the ban would give these businesses a
substantial boost in market opportunities for their products
and create additional competition in the live cattle market,
which is just one facet in dealing with the issue of packer
concentration.
The current ban actually favors imported meat over U.S.
produced State-inspected beef. While State-inspected products
are restricted from interstate commerce, meat from over 30
countries that is not directly inspected by USDA can be sold
anywhere in the United States. This legislation will recognize
State inspection systems that are the same as Federal
requirements and allow State-inspected products to compete on
an equal footing with imported products.
I would like to share with you a couple of examples of how
this ban has gone awry. Tyler Meat Company of Toledo, Ohio,
sold meat for 10-years to the River Cafe located on the
Michigan-Ohio border. USDA ordered Tyler to stop sales to the
cafe even though its kitchen was in Ohio. The cafe dining area
is located in Michigan. Thus, the sale of Tyler meat was
considered interstate commerce.
Another example is the Jackson Brothers Food Locker in
Post, Texas. Jackson Brothers supplied beef jerky to support
U.S. troops during Operation Desert Storm. They could ship
their product halfway around the world to support U.S. troops,
but they cannot send their product 80 miles west into New
Mexico. Not only are they limited from growing their business,
they are prohibited from selling their product to former Desert
Storm servicemen and women who came to like their product. It
is very important to note that Jackson Brothers met the
standards set by the State of Texas Department of Health Meat
Inspection Service, one of the best programs in the country.
The HACCP plan for their plant was in place in November of
1999, 3 months before it was required for plants of their size.
To summarize, this legislation will remove a barrier that
impedes competition, stifles growth, and limits the marketing
opportunities for U.S. beef. Passage of this legislation will
create a tremendous opportunity for State-inspected plants and
subsequently for cattle producers who market their livestock to
State-inspected plants.
Our goal is a dynamic and profitable beef industry. With
the growth in technology and the Internet, the world is truly
our market. We have recently been informed that other groups
opposing this particular bill have offered to compromise. We
look forward to working with them and getting as much support
for this bill as we can.
Mr. Chairman, we urge you to mark up this legislation in
your committee as soon as possible and report it to the Senate
floor. I want the beef industry to have the opportunity to grow
by meeting the needs of our consumer and not be stifled by laws
that have outgrown their use. Thank you very much.
The Chairman. Thank you very much, Mr. Nielson, for your
testimony.
[The prepared statement of Mr. Nielson can be found in the
appendix on page 74.]
It is a pleasure always to welcome Carol Tucker Foreman. We
have talked about the history of this issue and Carol Tucker
Foreman, as you know, served in the administration of President
Carter. I can remember her testimony, not necessarily on this
issue, but she may very well have discussed it 20-some years
ago.
Ms. Foreman. I am really sorry to say I did.
The Chairman. Nevertheless, we look forward to your opinion
today. Please continue.
STATEMENT OF CAROL TUCKER FOREMAN DISTINGUISHED FELLOW AND
DIRECTOR OF THE FOOD POLICY INSTITUTE CONSUMER FEDERATION OF
AMERICA, WASHINGTON, DC.
Ms. Foreman. Thank you, Sir. I am here representing the
Consumer Federation of America, and as you pointed out, I
served as Assistant Secretary of Agriculture with
responsibility for meat, poultry, and egg inspection. I am also
serving now as a member of the National Advisory Committee on
Meat and Poultry Inspection.
All three of the consumer representatives on the Advisory
Committee have endorsed S. 1988. The legislation would ensure
that all meat and poultry products produced in the United
States are inspected under a seamless system constituting a
basic set of public health-based requirements. It would also
eliminate the prohibition on shipping that meat in interstate
or international commerce.
The consumer interest in S. 1988 is clear. If passed in its
present form, this bill could help make meat and poultry
products safer and contribute to improved public health.
Pathogens do not recognize distinctions between Federal and
State systems or large and small plants. Contaminated meat is a
public health threat regardless of its source and the risk of
contamination should be reduced wherever they occur.
According to the Centers for Disease Control, USDA's new
public health-based pathogen reduction Hazard Analysis and
Critical Control Point program is successfully reducing
pathogen contamination and foodborne illness. All meat and
poultry plants, whether inspected by Federal or State
personnel, should meet those same minimum Federal requirements.
Although theoretically equal to Federal standards, State-
inspected plants have too frequently operated at a lower level.
The General Accounting Office and USDA's Office of Inspector
General have both criticized the quality of State inspection
programs. In 1996, the Wall Street Journal detailed the
problems with Florida's State inspection system and quoted the
head of the State inspection program acknowledging that State
inspectors are more lenient on inspection than Federal
inspectors would be.
Under S. 1988, State meat and poultry inspectors would
enforce Federal standards. Federal inspectors would perform
salmonella testing. USDA would also conduct annual compliance
audits of State inspection programs. In return, the
restrictions on shipment of these products would be
appropriately removed.
Frankly, Mr. Chairman, consumer advocates would probably
prefer a single Federal system rather than what is being
suggested here today. We all have to rely on separate systems
to inspect toys or airplanes or cars. We are, however, prepared
to accept this legislation because we think it does set a
standard for human health protection. We will have to oppose
the legislation if it is altered in a manner that undercuts the
public health standards.
In addition, we will be forced to oppose S. 1988 if USDA
for any reason restricts its program for pathogen reduction and
salmonella testing that is so basic to the new system. S. 1988
articulates USDA's ability to enforce the pathogen reduction
standards in State-inspected plants. In the absence of
salmonella testing, we just would not be able to judge whether
State-inspected meat really is as clean and safe as Federally-
inspected meat. That is why we can accept this bill now. The
system has changed.
Under USDA FSIS regulations, each company gets to establish
its own HACCP plan. In the absence of a Federal standard based
on public health protection, that is the salmonella standard,
each company would be free to establish a pathogen level based
solely on its own preferences for quality and safety.
All meat and poultry products bear the seal of the U.S.
Department of Agriculture. Consumers assume that mark means the
product meets a standard based on public health, not marketing
convenience. The salmonella standard is not unreasonable or
unworkable. Over 90-percent of the companies are complying now.
The success of the program is reducing foodborne pathogens and
illness. It also improves public confidence in the meat supply.
Last year, beef consumption increased to the highest level
in a number of years, in part because of reports that ground
beef is safer than it used to be. Eliminating the salmonella
performance standards and testing would endanger public health.
It would also threaten public confidence in the meat supply. It
would almost surely diminish both the domestic and
international market for American meat and poultry. Eliminating
that salmonella standard and testing would be both bad public
policy and bad business. Thank you.
The Chairman. Thank you very much, Ms. Foreman.
[The prepared statement of Ms. Foreman can be found in the
appendix on page 77.]
It is a pleasure always to have Patrick Boyle, the
President and CEO of the American Meat Institute. We look
forward to your testimony, Mr. Boyle.
STATEMENT OF PATRICK BOYLE, PRESIDENT AND CEO, AMERICAN MEAT
INSTITUTE, ARLINGTON, VA
Mr. Boyle. Thank you very much, Mr. Chairman. It is always
a pleasure to appear before this committee.
AMI has long opposed a blanket lifting of the current
prohibition against interstate shipment of State-inspected meat
and poultry. This policy stems from our firm belief in the need
for a single uniform system for oversight of this nation's meat
and poultry industry, whether that system is administered by
USDA or by State inspection programs in the State Departments
of Agriculture.
Currently, we believe there are actually 26 different meat
and poultry inspection programs in the U.S., one Federal
program covering 6,000 plants in 50 States plus 25 different
State programs covering an additional 3,000 plants. AMI would
like to see a single food safety oversight program for all
9,000 of these plants in all 50 States and would support a bill
that achieves that objective.
This desire for a uniform system was also in the minds of
those who cosponsor S. 1988 and in the minds of the Department
of Agriculture, which developed a white paper in both 1998 and
1999. Both documents outline the elements necessary for
creating a more uniform system than we have in place today.
I believe one clear outcome of the many discussions and
public hearings held on this issue over the past 4-years, at
least the past 4-years, is the strong message that greater
uniformity is required before we can contemplate interstate
shipment of State-inspected meat and poultry products. While
AMI commends Senators Hatch and Daschle and their cosponsors
for introducing the bill, AMI member companies remain concerned
about various provisions of the bill, all of which, by the way,
fall short of achieving national uniformity.
For example, to create a truly uniform system, AMI members
believe that the current bill must incorporate references to
the many FSIS notices, directives, and other policy memoranda
that, while not Federal regulations, they do constitute the
day-to-day details of the system under which Federal plants
currently operate. To be truly uniform, State plants must meet
these same requirements and the bill should explicitly state
so, especially since USDA testified earlier today in response
to one of your questions, Mr. Chairman, that is indeed their
intent.
Also to be truly uniform, we believe States should not be
permitted to set regulatory requirements that are different
from or in addition to the Federal requirements. Every plant,
Federal or State-inspected, should be subject to the same
identical requirements.
Also, national uniformity should also be exercised with
respect to the thresholds for entry into a State inspection
program. The current bill would let each of the 25 States set
its own threshold. AMI believes there should be a uniform
standard of eligibility for a plant to enter a State inspection
program.
At this time, AMI remains opposed to S. 1988 unless these
and other areas can be addressed. In that regard, however, I am
pleased to say that we have had some very productive
discussions with officials from NASDA, including Commissioner
Dailey, prior to this hearing today, and based upon those
conversations, I am hopeful that we will be able to work with
them, with this committee, Mr. Chairman, the sponsors of the
bill, and the Department of Agriculture and the other
interested parties to achieve a consensus bill, a true
consensus bill which replaces the 26 different inspection
systems with a single uniform meat and poultry inspection
system for all of the 9,000 plants in this country. Thank you
very much.
The Chairman. Thank you very much, Mr. Boyle, for your
testimony.
[The prepared statement of Mr. Boyle can be found in the
appendix on page 82.]
Before I ask questions of the panel, let me just indicate
that I have asked the Agriculture Committee staff to convene a
meeting next week of the major parties involved, all of which
are represented here today and maybe some others who may have
been stimulated by the hearing, to try to work through
differences that may be here. Some of these are apparent from
the testimony you have given, but there also is a spirit, at
least that I sense, of people already convening and conversing
and coming reasonably close.
I never want to predict in advance consensus before it
occurs, and this committee attempts to obtain that so that we
have the strongest support of our committee members when we go
to the floor and have some prospects for success of the bills
that we report, but I do sense that there is a constructive
spirit here. It is one that I would like to promote, and so I
simply mention that as early as next week, we will be coming to
grips really with the issues that have been developed today,
the nuances some of you have mentioned. Some of you have
supported the bill with reservations and suggested if some
things happen, you will not support it, and others have
suggested that you are still attempting to come to consensus.
Let me just ask for a moment, what barriers hinder State-
inspected plants from shifting to Federal inspections now? Are
there barriers that we ought to be considering that are out
there that make a difference as we look at this legislation, or
is this a significant factor? Yes, Mr. Dailey?
Mr. Dailey. Mr. Chairman, I think there are three reasons
that we hear people saying they do not want to switch to
Federal. One is facilities. Many times the USDA, when they look
at the engineering and design plans, as you heard here, they
would require something that does not relate to food safety.
For example, many of the old plants and even the Federal plants
that were grandfathered in had three-inch drain tiles. Now they
have to have four-inch drain tiles. It is really not a food
safety issue, but it is a very expensive item if you have to
switch to do that.
Another issue is the communications and bureaucracy. People
indicate, if I have to deal with a bureaucracy, I would rather
deal with a bureaucracy in Indianapolis or Columbus rather than
Washington, DC.
The third area, and all of these relate to economics, is
the overtime pay. As I mentioned, 8 hours a day is provided
free 40 days a week [sic], but if it happens to be a holiday,
if it happens to be a weekend, and we do maintain a great
degree of flexibility with our local plants, then they are
required to pay much more in per hour charge than what they
would at the State level.
The Chairman. I think those are important distinctions.
Does anyone else want to add to that part of the record?
[No response.]
Let me ask, then, a concern that has been raised is the
need for national uniformity with the Federal inspection system
and two specific points have been mentioned, whether States
should be able to set regulatory requirements and whether
States should be allowed to determine what size plants may
participate in a State inspection program. Does anyone have a
comment on those points?
Mr. Boyle. I addressed those two in my testimony, Mr.
Chairman, and just to reiterate, it is our view if we are going
to have a truly uniform system that the State requirements
should match the Federal requirements and vice versa. Allowing
the States to have authority to set additional requirements on
its face contradicts what I think is the overall objective here
of national uniformity.
The Chairman. I recall your making those points and I
appreciate your mentioning them. What is the response of other
members of the panel? For instance, on the second point, this
sometimes arises in issues before this committee. The States
come in and say, well, we are not satisfied with the level of
what the Federal people are leaving. We have some constituents
who want something extra special on top of this. So then many
people from the food industry come in and say, well, sort of
like the Grocery Manufacturers amendment comes up from time to
time and the idea for preemptive Federal authority so that you
do not have a piling on of additional authorities in an
interstate system of distribution. Is that applicable to this
problem, Ms. Foreman?
Ms. Foreman. I am going to respond here on promoting what
the Department of Agriculture said this morning in their
testimony, that none of these additional requirements could be
imposed on product coming into this State, any particular
State, as opposed to those originating in the State and under
State inspection. So I do not think you do have that problem of
piling on. It is particularly what a State wants to accomplish
for itself. Consumer advocates always believe that standards
are minimum and that people who want to add to them should be
allowed to do so.
The Chairman. Is that everybody else's understanding of how
this would work out?
Mr. Dailey. Mr. Chairman, I do not want to monopolize the
microphone, but let me say that we have been doing salmonella
testing for 12-years, long before the USDA mandated we do
salmonella testing. Last year in Ohio, we had 15-human and
fetal deaths from listeria monocytogenes in meat products that
happened to be Federally inspected. I think it is--and there
may be new bacteria or different pathogens that we do not know
about in the future. But our goal is to develop this seamless
system and I think we ought to work towards that.
The Chairman. Let me ask, on the affirmative side, the
suggestion has been made if we move toward this legislation, it
will increase sales, that this will be good for the business.
Has anybody done a study or have any idea of quantifying how
much good? In other words, is this a philosophical distinction
without any commercial effect or do you anticipate that volume
and profits will increase? Yes, Mr. Nielson?
Mr. Nielson. Mr. Chairman, I would like to respond to that
in what it would do for cattle producers in the country. If we
take an animal to a livestock auction and there are two or
three small plant owners there to bid on that animal as well as
some of the big operators, my cow brings more money. So it is
an economic benefit to those of us who produce cattle and
animals, and that is the group I represent. But I can assure
you, as a person who goes to an auction, going every week, I
know how the system works and competition is where it is at,
Sir.
The Chairman. That consideration comes before the Committee
frequently these days and so your testimony is that it enhances
the markets available to cattle producers.
Mr. Nielson. Certainly.
The Chairman. Mr. Pearson.
Mr. Pearson. Mr. Chairman, I talked to three or four small
producers that are looking at ways to develop niche markets
with their animals from the farm, and I mentioned the one, but
normally, they are going to be able to align themselves with a
smaller processor much more easily than they can with a
Federally-inspected plant, and one of them in particular had
been the Federal plant and that plant closed down and basically
put him out of business because he could not get at point
anyplace else and cross State lines.
The other one I mentioned, he is taking product into
Chicago that is costing him considerably more because he has to
go out of State to a Federally-inspected plant, which is still
twice as far away from him as a small State-inspected plant. So
for the people that are really looking at ways to develop
branded products, and we see more individuals, small producers,
trying to do that, they can do that more easily with the small
plants that are close to them and even have a branded product
that they are looking for to really track that product all the
way to their final consumer.
The Chairman. I thank each one of you for your individual
testimony. As I mentioned before, your full statements will be
a part of the record, but the oral statements you have made, I
think have been very helpful in delineating the issues, and
your spirit of being willing to continue to converse likewise
is very encouraging. We will try to proceed with that good will
in mind with the meetings that commence next week.
We thank you for coming today and participating in this
hearing and the hearing is now adjourned.
[Whereupon, at 12:05 p.m., the Committee was adjourned.]
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A P P E N D I X
April 6, 2000
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April 6, 2000
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