[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]




                  AGRICULTURE, RURAL DEVELOPMENT, FOOD

                  AND DRUG ADMINISTRATION, AND RELATED

                    AGENCIES APPROPRIATIONS FOR 2003

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS
                             SECOND SESSION
                                ________
     SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 
                  ADMINISTRATION, AND RELATED AGENCIES
                     HENRY BONILLA, Texas, Chairman
 JAMES T. WALSH, New York            MARCY KAPTUR, Ohio
 JACK KINGSTON, Georgia              ROSA L. DeLAURO, Connecticut
 GEORGE R. NETHERCUTT, Jr.,          MAURICE D. HINCHEY, New York
Washington                           SAM FARR, California
 TOM LATHAM, Iowa                    ALLEN BOYD, Florida         
 JO ANN EMERSON, Missouri
 VIRGIL H. GOODE, Jr., Virginia
 RAY LaHOOD, Illinois               
                         
 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
   Henry E. Moore, Martin P. Delgado, Maureen Holohan, and Joanne L. 
                        Perdue, Staff Assistants
                                ________
                                 PART 2
                        CONSERVATION PROGRAMS AND
                    MARKETING AND REGULATORY PROGRAMS
                                                                   Page
 Natural Resources Conservation Service...........................    1
 Marketing and Regulatory Programs................................  409
     Agricultural Marketing Service...............................  557
     Animal and Plant Health Inspection Service...................  708
     Grain Inspection, Packers and Stockyards
         Administration........................................... 1035
                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 79-721                     WASHINGTON : 2002



                      COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio                  DAVID R. OBEY, Wisconsin
 JERRY LEWIS, California             JOHN P. MURTHA, Pennsylvania
 HAROLD ROGERS, Kentucky             NORMAN D. DICKS, Washington
 JOE SKEEN, New Mexico               MARTIN OLAV SABO, Minnesota
 FRANK R. WOLF, Virginia             STENY H. HOYER, Maryland
 TOM DeLAY, Texas                    ALAN B. MOLLOHAN, West Virginia
 JIM KOLBE, Arizona                  MARCY KAPTUR, Ohio
 SONNY CALLAHAN, Alabama             NANCY PELOSI, California
 JAMES T. WALSH, New York            PETER J. VISCLOSKY, Indiana
 CHARLES H. TAYLOR, North Carolina   NITA M. LOWEY, New York
 DAVID L. HOBSON, Ohio               JOSE E. SERRANO, New York
 ERNEST J. ISTOOK, Jr., Oklahoma     ROSA L. DeLAURO, Connecticut
 HENRY BONILLA, Texas                JAMES P. MORAN, Virginia
 JOE KNOLLENBERG, Michigan           JOHN W. OLVER, Massachusetts
 DAN MILLER, Florida                 ED PASTOR, Arizona
 JACK KINGSTON, Georgia              CARRIE P. MEEK, Florida
 RODNEY P. FRELINGHUYSEN, New Jersey DAVID E. PRICE, North Carolina
 ROGER F. WICKER, Mississippi        CHET EDWARDS, Texas
 GEORGE R. NETHERCUTT, Jr.,          ROBERT E. ``BUD'' CRAMER, Jr., 
Washington                           Alabama
 RANDY ``DUKE'' CUNNINGHAM,          PATRICK J. KENNEDY, Rhode Island
California                           JAMES E. CLYBURN, South Carolina
 TODD TIAHRT, Kansas                 MAURICE D. HINCHEY, New York
 ZACH WAMP, Tennessee                LUCILLE ROYBAL-ALLARD, California
 TOM LATHAM, Iowa                    SAM FARR, California
 ANNE M. NORTHUP, Kentucky           JESSE L. JACKSON, Jr., Illinois
 ROBERT B. ADERHOLT, Alabama         CAROLYN C. KILPATRICK, Michigan
 JO ANN EMERSON, Missouri            ALLEN BOYD, Florida
 JOHN E. SUNUNU, New Hampshire       CHAKA FATTAH, Pennsylvania
 KAY GRANGER, Texas                  STEVEN R. ROTHMAN, New Jersey    
 JOHN E. PETERSON, Pennsylvania
 JOHN T. DOOLITTLE, California
 RAY LaHOOD, Illinois
 JOHN E. SWEENEY, New York
 DAVID VITTER, Louisiana
 DON SHERWOOD, Pennsylvania
   
 VIRGIL H. GOODE, Jr., Virginia     
   
                 James W. Dyer, Clerk and Staff Director

                                  (ii)


 
   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2003

                              ----------                              

                                      Wednesday, February 27, 2002.

                   NATURAL RESOURCES AND ENVIRONMENT

                               WITNESSES

MARK E. REY, UNDER SECRETARY, NATURAL RESOURCES AND ENVIRONMENT
PEARLIE S. REED, CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
BRENDA THOMAS, ACTING DIRECTOR, BUDGET PLANNING AND ANALYSIS DIVISION, 
    NATURAL RESOURCES CONSERVATION SERVICE
DENNIS KAPLAN, BUDGET OFFICE, DEPARTMENT OF AGRICULTURE

                            Opening Remarks

    Mr. Bonilla. The subcommittee will come to order. Good 
morning to everyone. If some are curious as to the reason for 
the lights and the extra microphones on the podiums today, it 
is because later today there is going to be a hearing on Secret 
Service needs. I would like to think that this hearing would be 
the center of attention, but that is the reason for the 
different environment that we are going to be working with this 
morning.

                       Introduction of Witnesses

    We are pleased to be holding a hearing today for the 
Natural Resources Conservation Service fiscal year 2003 budget 
request. Appearing before us today are Mark Rey, the Under 
Secretary for Natural Resources and Environment; Pearlie Reed, 
the chief of the NRCS; and Brenda Thomas, the acting budget 
officer at the NRCS. Also at the witness table is Dennis 
Kaplan, who is pinch hitting today for Mr. Dewhurst, who I 
understand is on the dark side, as we sometimes call it 
appearing over there with the Secretary. We welcome you today.
    Mr. Rey, I know this is your first time before this 
subcommittee. I want to welcome you and I want to congratulate 
you on your appointment. It has been reported that you stated 
that you have lowered expectations for this job, so much so 
that one of your objectives is just to keep the job, unlike 
your two predecessors who were unable to keep it. You do have a 
tough job ahead, Mr. Rey. We know that you will be dealing with 
two agencies under your jurisdiction that have a great impact 
on public lands, through the forest service and on private 
lands through the Natural Resources Conservation Service. I am 
sure you are very much up to the task.
    Mr. Reed, this is not your first time before this 
subcommittee, so I want to welcome you back. I would just like 
for you to think about the importance of your agency, and the 
impact that it has on private lands in this country. I would 
encourage you to do everything you can do to ensure that your 
programs are carried out with as little bureaucracy as possible 
to get the financial resources on the ground where they are 
sorely needed.
    We have your statements before us, and we have reviewed 
them. We will enter those statements into the record, but 
before we begin, I would like to recognize my ranking member, 
Ms. Kaptur, a great partner in this process.
    Ms. Kaptur. Thank you, Mr. Chairman, very much, and we 
welcome you, Mr. Under Secretary, and, of course, Chief Reed 
and all of the members of your staffs that you have brought 
with you today. I just wanted to say I was so pleased to read 
your background. We share Ohio heritage, particularly northern 
Ohio heritage. And also the University of Michigan.
    So probably I will be interested in asking you during my 
question period whether you took the same course in woody 
plants that I did, and having come from the school of natural 
resources there with all of your experience in the Senate, I 
mean, my goodness, what an excellent background you have for 
the position you currently hold, and so we look forward to your 
testimony.
    Mr. Bonilla. Thank you, Ms. Kaptur. We will start by 
recognizing Mr. Rey, and then if Mr. Reed has an opening 
statement as well, we will proceed with that. Thank you.

                      Under Secretary's Statement

    Mr. Rey. Thank you, Mr. Chairman, Ms. Kaptur, Mr. Walsh. I 
am grateful for the opportunity to appear before you today to 
present the fiscal year 2003 budget and program proposals for 
the Natural Resources Conservation Service of the Department of 
Agriculture. In addition to Mr. Reed and Mr. Kaplan appearing 
with me today are Brenda Thomas, who is the acting NRCS budget 
director, and Mack Gray, behind me, who is the deputy under 
secretary for Natural Resources and Environment. I will 
summarize and submit my entire statement for the record.
    Mr. Chairman, the President often reminds us that every day 
is Earth Day when you work the land, and from my perspective, 
it is clear that the men and women of NRCS out in the field are 
making a tremendous difference to ensure that farmers and 
ranchers have the resources and expertise they need to care for 
natural resources and respond to emerging challenges. This 
happens through conservation operations and specifically 
through conservation technical assistance.


                  AMERICAN CUSTOMER SATISFACTION INDEX


    Interestingly, NRCS has one of the highest ratings for 
customer satisfaction among all government and private sector 
organizations. Last year, NRCS participated in the American 
Customer Satisfaction Index, which surveyed customers of NRCS' 
conservation technical assistance program.
    The ACSI, the American Customer Satisfaction Index, is 
administered by the University of Michigan Business School, an 
institution both Ms. Kaptur and I can attest to the competence 
of. It is the only uniform cross industry and government 
measure of customer satisfaction which allows benchmarking 
between the two sectors. The NRCS results were the highest for 
any USDA agency participating in the 2001 survey, and are 
comparable to the results received from private sector 
companies such as Mercedes-Benz and the Ritz-Carlton Hotel 
chain. Our customers have come to expect excellent service from 
the agency, and it will be a challenge to continue to ensure 
that funding and resource support for our staff are sufficient 
to help them meet the expectations of farmers and ranchers.


                 RESOURCE CONSERVATION AND DEVELOPMENT


    Let me turn to the Resource Conservation and Development 
program. Because of the support of this subcommittee, the 
Secretary was able to announce the selection of 20 new RC&D 
areas earlier this year, bringing the total number of 
authorized areas to 368. Through this program, non-Federal 
Government agencies, including State, local and tribal 
governments, as well as private and not-for-profit 
organizations, are playing important roles in conservation 
policy. The RC&D program has been extremely successful in 
leveraging and matching resources among these different 
organizations. We continue to receive excellent applications, 
deserving of USDA recognition, and we want to enhance and 
maintain this very popular program.


                      EMERGENCY WATERSHED PROGRAM


    Turning to our water resource-related programs, we know 
that emergency needs for watersheds resulting from natural 
disasters averaged 110 million dollars per year over the last 
several years. However, in the past, rather than planning for 
this need, we have historically relied upon emergency 
supplemental appropriations to respond to stricken communities 
often months after the disaster. The administration's fiscal 
year 2003 budget proposes $111 million for the Emergency 
Watershed Program, which will allow us the latitude to better 
respond to disasters more quickly.
    In conclusion, the programs presented to this subcommittee 
for funding are essential to the policy objectives proposed in 
our overall agriculture, conservation area framework in three 
areas: First, support for the cadre of trained and skilled 
professionals out on the land working with farmers and ranchers 
every day through Conservation Operations; second, providing 
that workforce and the workforce of State and local government 
cooperators with the very best data, technical tools and 
training through Conservation Operations; and third, continuing 
to foster collaboration and partnership with other 
organizations through Conservation Operations.
    I thank the subcommittee for the opportunity to appear and 
would be happy to respond to any questions, including the woody 
plants curriculum at the University of Michigan School of 
Natural Resources, which not only Ms. Kaptur and I 
participated, but in the sense of the fact that it is a small 
world, Mr. Reed's predecessor, Paul Johnson, taught that 
program one semester as well. So it seems that there is a large 
community of alumni from the woody plants program. Thank you 
very much.
    Mr. Bonilla. Thank you, Mr. Rey.
    [The statement of Mr. Rey follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Bonilla. Mr. Reed.

                        Conservation Operations

    Mr. Reed. Mr. Chairman, thank you and members of the 
committee, for the opportunity to appear here before you today. 
With your permission, I would like to submit my written 
testimony for the record.
    Mr. Chairman, for the past 32 years, each day I come to 
work, I think about what is important and how the NRCS can get 
more conservation on the ground. Today, I would like to take 
advantage of this opportunity briefly to tell you what I 
believe is the most important investment you can make to 
private lands conservation. That investment is in our 
Conservation Operations account. The Conservation Operations 
account underpins our entire national private lands 
conservation infrastructure in this country. It leverages more 
than a billion dollars annually in State and local conservation 
investments. These investments are primarily with the local 
soil and water conservation districts. The partnership USDA has 
with conservation districts is a locally-led, integrated 
approach for voluntary private lands conservation. Also, that 
partnership provides safe passage for USDA employees into local 
communities, on farms and ranches, so they, in concert with 
land owners, can practice the science and art of putting 
conservation practices on the ground.
    Mr. Chairman, I am pleased to be here today, and again, 
thank you for this opportunity.
    Mr. Bonilla. Thank you, Mr. Reed and Mr. Rey.
    [The statement of Mr. Reed follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Bonilla. We are going to proceed a little differently 
this morning. We had a little mix-up at the last hearing, and I 
apologize for that to Mr. Boyd. He was recognized out of order. 
I am going to yield to him first today.
    Mr. Boyd. Thank you very much, Mr. Chairman. I appreciate 
that. I feel sort of strange jumping in front of Ms. Kaptur and 
Mr. Walsh and others, but you are the Chairman.
    First of all, let me say welcome to all of you, and Mr. 
Secretary, it is great to see you sitting in that seat. I have 
had the pleasure of working with you on a very important 
landmark piece of legislation that improved communities that 
have national forests in them. Many of us who are now 
benefiting from that legislation owe a great deal of thanks to 
you for shepherding that through when you were in a very 
important position on the Senate staff. So thanks for that, and 
thanks for being here.

                          Watershed Protection

    I want to start my line of questioning by focusing on the 
area of watershed protection, because I know there seems to be 
a change of direction in the watershed programs in the 
President's budget. The PL 566 program specifically is a 
nationwide program, as you know, that was designed to protect 
and improve watersheds up to 250,000 acres in size.
    Currently there are approximately 515 active watershed 
projects under this program around the country, while I don't 
understand all of what is going on in the rest of the country, 
I do understand what is going on in Florida, and I want to give 
you a very specific example of how the NRCS, with this 
watershed program, has made our lives better.

                          Suwannee River Basin

    There is a rather famous river down there called the 
Suwannee River, which many of you have heard about. That 
Suwannee River builds up in south Georgia in the Okefenokee 
Swamp, and it flows across the Georgia line and into the Gulf 
of Mexico. It is a historic natural resource, and obviously the 
pressure around that river to build, to have agricultural 
businesses, has been immense over the last 50 years. But at the 
mouth of that river there is a very important shell fish 
industry, oystering and clamming and those kinds of things. 
Over the last 15 years, the Federal Government, the Department 
of Labor, and the State Department of Agriculture have worked 
hand in hand with the local community to build an agriculture 
industry that has become very successful and has really helped 
our communities.
    We are only able to do that because we kept that river 
clean. In the northern Suwannee basin, there are probably 75 to 
80 dairies. It is a big dairying community. About 8 years ago, 
we put in place the PL 566 program to clean up--or help assist 
these areas in their waste disposal.
    It has been a very successful program, and we are in the 
9th year of that program, and this budget ends what we are 
about 3 years away from completion. Just this morning, I talked 
to our water management district director down there, and we 
are going to need about a million dollars funding each year 
over the next 3 years, but your budget ends that. This problem 
is what I want to focus my question on, and I want you to talk 
to me a little bit about the so-called--emergency watershed 
protection proposal which you have that seems to take those 
kinds of programs and shift them to something to respond to 
some emergency.
    My contention would be that if we would prevent the 
emergency from happening to start with, we would be a lot 
better off.

                     Watershed Program Termination

    Mr. Rey. The discussion within the administration about the 
watershed operations program of NRCS was, I think, honestly 
speaking, the greatest challenge that we faced in the 
development of the NRCS 2003 budget. And that has been the case 
in the past, that is not necessarily a new development. In 
fiscal year 1994, for instance, at the end of the day, Congress 
reduced the watersheds operations budget by 50 percent to 
respond to emergency flooding in 1994 with what was supposed to 
be a one-time reduction that was never modified thereafter. So 
funding has stayed flat from 1994 to present.
    In this budget cycle, we face challenges and difficulties 
in making trade-offs more severe than we faced in 1994, and the 
treatment of the watershed operations program is a reflection 
of that.
    At the same time, we are mindful of the fact that the 
program has a great deal of local support and support among 
members of Congress. Indeed, in fiscal year 2002, 64 percent of 
the funds for the watershed operations account were earmarked 
by members of Congress, which to me is a reflection of strong 
congressional support. The one thing that I can commit to you 
is that the discussion over what priority this program should 
enjoy, given the other budget priorities we are trying to deal 
with, both administration-wide and within the Department, is a 
discussion that will continue.
    It is not uncommon, for programs that are authorized by 
statutes that are 40 and 50 years old, which is the case with 
both of our watershed operations accounts, to face this kind of 
scrutiny. It is a scrutiny that we don't shirk from, and a 
discussion that we want to continue to have with you.
    Mr. Boyd. Mr. Chairman, I will follow up, since I see my 
red light is on I will follow up later on. Thank you----
    Mr. Bonilla. Thank you, Mr. Boyd.
    Mr. Boyd [continuing]. For your kindness.
    Mr. Bonilla. Mr. Boyd hit the nail on the head this 
morning, Mr. Rey. I feel that we are going to probably hear 
from a lot more members on this subcommittee about this 
specific subject. This is the subject that had Mr. Boyd not 
started out with it, I was going to begin with it myself. I can 
assure you that we are hearing from our project managers, not 
only in our particular areas, but from people all over the 
country. There is great concern about how to fund some of the 
smaller projects, and some of the new projects that are 
pending. So we are going to work this out, and I think after 
this morning, you will walk away with a clear sense of the 
feeling of every member on this subcommittee about this 
watershed issue.
    Ms. Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman, and I am always happy 
to yield to my good friend from Florida, Mr. Boyd, and I thank 
you for your courtesy to him.

                      Administrative Efficiencies

    I wanted to ask Secretary Rey, now, in the budget that you 
submitted, as I read it, there are proposed cuts, or you 
describe them as savings, of over $30 million from what is 
called administrative efficiencies that were not mentioned in 
your testimony this morning. The budget provides almost no 
details on these so-called efficiencies. I have several 
questions in regard to this. First of all, I would like to know 
whether when your budget was submitted to OMB, whether those 
efficiencies were a part of your original proposal or not, and 
whether the budget you are submitting to us today is the same 
one that you submitted to OMB.
    I would like to know how did you arrive at such a precise 
estimate of efficiencies of $30.8 million in 341 staff years, 
and I would like to know that if these savings are not 
achieved, what happens to the conservation operations account?
    Mr. Rey. I don't think it will surprise anyone on this 
subcommittee to know that the budget that we submitted to OMB 
is not the final budget that we sent to Congress. I doubt that 
that is the case for any agency or department of the 
government. We did submit to OMB some efficiencies which we 
believe would result in savings. They had some additional 
efficiencies that they suggested to us would result in greater 
savings. In the course of working back and forth with them 
about what we thought we could reasonably achieve in the course 
of a fiscal year, we agreed on the number that is included in 
the President's budget.
    Most of those efficiencies--and I will let Mr. Kaplan 
expand on this--but most of those efficiencies are efficiencies 
associated with our continuing effort to collocate offices with 
other USDA agencies and to combine administrative functions in 
the field and to continue to extend the service center concept. 
So I don't think that those efficiencies imply reductions in 
Conservation Operations. To the contrary, the idea is to try to 
stretch our dollars further to achieve more conservation 
operation per dollar, but most of them instead envision one set 
of support service staffs serving NRCS, FSA and Rural 
Development as we continue to collocate offices.
    Did you want to add to anything?
    Ms. Kaptur. No. That is fine. Is it possible then for you 
to provide more detail to us----
    Mr. Rey. Sure.
    [The information follows:]

    NRCS has been working with the USDA Service Center Modernization 
Initiative (SCMI) to restructure county field offices, modernize and 
integrate business approaches and replace the aging information systems 
with a modern common computing environment (CCE) that optimizes 
information sharing, customer service, and staff efficiencies. There 
are many proposed, planned, and ongoing management initiatives designed 
to reduce overhead expenses thereby allowing additional resources of 
the County Based Agencies (CBA's) to be shifted to the field level. 
These initiatives include: completing the Common Computing Environment; 
updating telecommunication capabilities; competitive sourcing of 15% of 
the FTE's on the FY 2000 Federal Activities Inventory Reform Act list; 
studying efficiencies that can be gained by restructuring or 
reengineering the CBA's administrative functions; and additional 
service center office consolidations.

    Ms. Kaptur. How do you actually calculate these savings or 
efficiencies? And you are saying that you assume you will 
achieve these? But in any case if you don't, there will not be 
a hit on the conservation operations account?
    Mr. Rey. No. There would not be a hit on the Conservation 
Operations account. If we don't achieve them, we will have to 
reprogram in the following year, but so far--and I sort of have 
to knock on wood--so far when we have agreed to a target with 
OMB, we have met it. Now, that is not to say that as an initial 
matter at the beginning of the discussion we will be starting 
an agreement, but ultimately when we have reached an agreement 
on what are achievable levels of efficiencies, we have, over 
the last three or four cycles, achieved them.

                      CONSERVATION INFRASTRUCTURE

    Ms. Kaptur. All right. Let me move quickly to Chief Reed 
and ask, as you look at your entire, really, stellar career, 
what would you say are some of the major achievements that you 
feel that you have had, and as you look forward, what are some 
of the challenges we still face in the conservation arena as we 
try to think more at the policy level rather than the 
accounting level here? Where should Congress be focused?
    Mr. Reed. Well, first I think the greatest achievement I 
have seen in my 30-plus-year career is the pulling together of 
the basic conservation infrastructure out in the countryside.
    Ms. Kaptur. And how much, Chief Reed, of the countryside do 
we now cover, of the private lands where we have got voluntary 
groups working?
    Mr. Reed. Under our Conservation Operations activity, we 
cover all the continental United States and the areas outside 
the continental United States, with few exceptions. Keeping the 
basic Conservation infrastructure together and the partnerships 
so that we can deliver the basic conservation programs and 
services to the farming and ranching community, is where the 
Congress should be focused as the current farm bill is being 
debated. I see the greatest challenge for NRCS is being able to 
keep a good solid professional workforce in place throughout 
the country so that we can provide the appropriate level of 
technical assistance so that we can implement programs that are 
being debated, programs that we know will be needed in the 
future.

                        CUSTOMER SERVICE RATING

    Ms. Kaptur. I know that my time is expired on this first 
round, but I just wanted to say, to receive an 81 percent score 
from the University of Michigan's business school is unheard 
of, even in the private sector, and so to have that kind of 
favorable response to your activities is a true credit to the 
professionalism of those cooperators and advisers all over this 
country, and I guess that tells me that USDA better be careful 
in the future to not make changes that would harm that level of 
service.

                             LAND STEWARDS

    I just wanted to mention that recently in my own community, 
one of our chief cooperators and land stewards died, and I had 
the privilege to attend his funeral. It really made me think 
about how we recognize these individuals, and I don't think we 
really do very well. I represent both an urban and a rural 
area, but we have had just these tremendous stewards that have 
helped to develop a conservation ethic in our region, and I 
have been thinking about what more could we do to acknowledge 
and lift up these people as models to the broader community. If 
you have any suggestions about that, I really have been 
thinking about that of late. There are a whole set of 
individuals who are part of this team locally, the original, I 
guess you could say, the original plantings, and they have now 
matured and moved on. But we don't seem to--at least in our 
region--recognize them appropriately to the broader community. 
If you have any suggestions on how we might do that, I would be 
most grateful to you.
    Mr. Reed. We are in the process right now of internally 
developing a program to address just that. I would like to 
follow up sometime in the next 2 or 3 days and provide you with 
a status report on where we are with that project.
    Ms. Kaptur. I thank you. Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Ms. Kaptur.
    Mr. Walsh.

                   IMPORTANCE OF WATERSHED PROTECTION

    Mr. Walsh. Thank you, Mr. Chairman, and thank you both for 
your testimony today. I would like to associate myself with the 
remarks on my colleague from Florida, Mr. Boyd and with the 
chairman on watershed protection. We spend, in our office, an 
inordinate amount of time on water resources. We have lots of 
water in New York. It is extremely important to our quality of 
life to industry and to the environment, and also the 
conservation reserve program, which has benefitted primarily--
primarily the western part of the country, but we have great 
interest in that program, and I will continue to be a supporter 
of that program. And we very much appreciate what you will do 
to protect those resources.

            ENVIRONMENTAL RISKS OF ANIMAL FEEDING OPERATIONS

    My question regards animal feeding operations, and as you 
mention in your testimony, there are significant environmental 
risks posed by these operations. And they also pose a 
tremendous difficulty for farmers to comply with the 
regulations that have been proposed by EPA and USDA. I believe 
that in order for farmers to comply with those regulations, we 
are going to have to be supportive and do our part, and I just 
wanted to ask you your thoughts, either or both, on what you 
feel are the major obstacles that animal feeding operations 
will have, and are we prepared to provide them with the 
resources they need to meet these new regulations?
    Mr. Rey. I will start, and then I will ask Mr. Reed if he 
wants to augment the remarks.
    I think the challenges are twofold. First, the development 
of reasonable and understandable requirements, and then second, 
the assurance of a delivery system on the ground that assists 
farmers in meeting those requirements. We are committed to 
addressing both of those challenges.
    In the first instance, with EPA's cooperation and support, 
USDA has formed an interdepartmental working group, which Dr. 
Gray behind me cochairs with the EPA, to work on the 
development of both animal feeding operation and concentrated 
animal feeding operation regulations, as well as a number of 
other common concerns affecting the environmental implications 
of agricultural operations.
    I believe what we are going to see as a result of that 
collaboration are a set of regulations that are farmer friendly 
and that can be reasonably implemented to affect material water 
quality improvements.
    The second challenge, developing delivery systems to assure 
that farmers have the assistance and the resources to implement 
those regulations, is something that I hope and believe that we 
will be assisted in as Congress completes its work on the farm 
bill. There is a considerable amount of EQIP money devoted to 
that task, and if Congress does finalize the farm bill and 
continue that approach, we are eager to get about the task of 
implementing it.
    Mr. Reed. I would just like to add to that by saying that 
the amount of technical and financial assistance available to 
farmers, in my opinion, will be key relative to USDA's ability 
to support the farming and ranching community.
    Mr. Walsh. The approach that EPA takes is far more 
regulatory, and USDA tends to stress voluntary compliance. And 
as we all know, EPA will, in effect, put a gun to the head of a 
municipality to meet clean water standards based on waste water 
treatment and those sorts of problems, pollution--other 
pollution nonpoint source, too.

                     TMDL and CAFO Rules Compliance

    With the promulgation of TMDL rules and CAFO rules, which 
are absolutely needed to protect water resources in the country 
and ultimately the entire national environment, the road to 
hell is paved with good intentions, and farmers who are 
operating on a very slim margin, certainly in my area, which is 
primarily dairies, really, really worry about the ability--
their ability to meet these requirements.
    So I would just urge you when you go to prepare your budget 
and when you go to OMB, make the case, and we will, too, and we 
will support you, that we need additional resources to help our 
farmers comply so that they can do their fair share. I don't 
think anybody would disagree that farmers are excellent 
husbands of the land, but they can't jump through all these 
hoops without our help.

                         Relationship with EPA

    Mr. Rey. Those are good points that we are mindful of. I 
think one of the advantages of the cooperative relationship 
that we have developed with EPA is that we are beginning to get 
a common cultural approach to dealing with the environmental 
quality implications of agriculture, and EPA is beginning to 
adjust what I consider classical regulatory thinking in terms 
of what will really work on the ground. We are not going to 
bridge that divide overnight, but I think with Dr. Gray's 
assistance, we have at least concurred interdepartmentally on 
which end of the cow gets up first.
    Mr. Walsh. Thank you. Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Mr. Walsh.
    Mr. Farr.
    Mr. Farr. Thank you very much, Mr. Chairman. I appreciate 
this hearing today. I am looking over the USDA's agency list, 
and as I look at the budgets in your agencies, you rank about 
number 4 among them. Half the budget goes to food and 
nutrition, but the rest of the budget of the agency, you rank 
number 4, and it is kind of interesting.

          Agency Dealing with Dirt and What comes off the land

    The way I look at it, you are the only agency in the USDA 
that deals with dirt, and everything comes from the dirt. I 
mean, everything else we spend money on comes from what is 
coming off the land. You are the only agency that puts time and 
energy into what goes into the land, and if we are going to 
preserve agriculture, then we have got to do it.

                 Termination of Water Resources Program

    What I can't understand is why, after this committee spoke 
to the Secretary last week, emphasized that it is what is 
running off the land. It is about management practices that are 
causing great concerns, and yet when I look at your budget on 
the watershed flood operations, it is zeroed out. On the 
watershed surveys and planning, it is zeroed out. On the 
watershed rehabilitation program, it is zeroed out. And on the 
emergency supplemental funding, it is zeroed out.
    Yet you have done a survey showing that the investment in 
the watershed program that benefits to the Nation generate 
about $1.6 billion. Again, my question is that you propose 
eliminating the watershed and flood prevention operations, and 
you say that these needs can be addressed by local governments, 
yet you don't point out why. Yet last year the Department 
advised this committee that there was an unfunded Federal 
commitment to this program, about $1.4 billion. And I am really 
puzzled why that last year this was an unfunded Federal 
commitment, and this year it is not. Can you explain that? And 
do you really expect the State and local governments to provide 
for the $1.4 billion Federal commitment?
    Since it was so cost effective last year, why is it all 
zeroed out? And I think frankly you are going to hear from this 
committee over and over again. What I don't understand about 
the Department is that why don't we tie in conditions for risk 
management? Why isn't insurance based on these things? I mean, 
it is nice to ensure a crop, but if there is damage done to the 
land and there is runoff, somebody else has to pay it. That is 
a risk.
    Why not--the cooperative State research and extension 
services, why can't those grants be tied into the efforts of 
NRCS? Why not allow the animal plant inspection service which 
also has a much higher budget to be tied into these practices? 
What I am trying to say, and I think the rest of the committee 
says, is that what is happening in America is people are 
understanding that it is--under it all, is the land. You are 
the only agency in the USDA that really deals with the land, 
and if we are going to preserve this land and protect it so 
that it doesn't have downstream--you know, we can do fine on 
the site, but if it is having--if that site creates problems 
downstream, we are going to pick that--we are going to have to 
pay for that somewhere else.
    So to me, zeroing out the watershed management program is, 
you know, robbing Peter to pay Paul. It is just foolish, 
totally foolish. It doesn't make any sense at all, and in light 
of what you said last year about the program, can you explain 
why it is zeroed out this year?
    Mr. Rey. I think on the watershed programs, I am getting a 
fairly consistent theme here. We are a little dense, but we are 
not that thick. So we will obviously take that back. We will 
obviously continue to talk about that as this budget cycle 
progresses. And as I said earlier, the priority setting that we 
do as an administration, that you do as a Congress, with 
respect to the watershed program is not new this year. We cut 
the program in half in fiscal year 1994, and that money was 
never restored, even though it was supposed to be a one-time 
effect in response to flood conditions. But clearly, this 
discussion on watersheds will continue.

                  Erosion and Conservation Operations

    With regard to erosion and Conservation Operations, I would 
make two points. One, I think our budget is sound there. It is 
not reduced from fiscal year 2001 levels. But, two, and 
probably more importantly, much of the effort that will go into 
those on the land programs are going to be a combination of not 
only this budget but the funds that are provided through the 
farm bill programs which provide the majority of assistance to 
farmers today for those kinds of programs including EQIP, CRP, 
farmland protection, wetlands reserve, and wildlife habitat 
improvement.
    So I don't think you are seeing the full picture with just 
this budget. Once Congress completes its work on the farm bill, 
and put that alongside the budget, I think what you are going 
to see in total--and, again, I am not talking about watersheds 
now, I am talking about on land conservation, I think what you 
are going to see in total is a pretty robust program for moving 
forward in the next century.
    Mr. Farr. What about the integration of all of the 
agencies?
    Mr. Rey. I think we are seeing more of that now. It is 
something that we work on a lot, both in collocation, as well 
as in combining planning functions. But we can do better at 
that, and we will continue to strive to do better at that.
    Mr. Farr. Thank you.
    Mr. Bonilla. Thank you, Mr. Farr.
    A little logistical information here. We are going to have 
to go vote soon. Mr. Latham, my vice chairman on the 
subcommittee, is now on the floor and will return and continue 
the hearing immediately upon his arrival. So you might need to 
be patient with us for just a couple of minutes.
    But at this time we do have a couple minutes before we have 
to depart, so I would like to yield once again to Mr. Boyd if 
he has any additional questions.

                       Conserving Soil and Water

    Mr. Boyd. I really didn't want to leave this topic without 
saying to you good folks who have spent your life in the 
business of helping America's ag producers conserve soil and 
water that this panel recognizes the importance of your work. I 
have got pictures on my office wall at home of my family farm 
that were taken in 1940, when my father started farming it and 
there are washes and ditches in it large enough to park a truck 
in.
    The efforts of the United States Government through the old 
soil conservation service, now NRCS--and we can argue about how 
we put it together, what vehicle we do it with, but the efforts 
that we have made together with the industry have made us the 
premier ag-producing country in the world. We know that times 
have changed, and now our challenges are different. They are 
not how do we keep holes from getting in our field. We figured 
that out long ago.
    In most of our productive ag land, we have good practices 
in place. Our challenge now is the pressure being put on our 
ag-producing land from outside urbanization and developing ways 
to deal with those problems?
    That is really what we are talking about here today, and 
the watershed program is one way to preserve our natural 
resources, make sure that our estuaries are clean, make sure 
that our drinking water in our urban communities is clean, and 
make sure that the streams and ponds are productive for fish 
and those kind of things. That is really what we are talking 
about and that is what this committee wants to focus on. How do 
we take the needs of the changing times in conservation and 
focus on that.
    I just want to put a face on this watershed thing.
    In 1994, when the program started, we asked 43 dairies in 
the Suwannee Valley area to participate in the program. Now, 
you all know that getting a farmer to participate in a Federal 
program is not an easy thing to do. We got 40 out of 43 dairies 
who committed to clean up their waste coming out of that area. 
With the help of NRCS we have completed 30 of those.
    We still have 10 that are in the implementation process, 
and we just can't pull the plug on those guys. I mean, I can't 
go home and face those guys if I have to tell them that the PL 
566 program is no longer in place. Not only am I not going to 
be able to face them, I am not going to be able to face the 
oyster men and the clam fishermen down on the coast.
    I just wanted to put that personal face on what you are 
doing and the importance of the work that you all have spent 
your life dedicated to. I know there is no question there, Mr. 
Chairman, but I just wanted to make sure that it got to be part 
of the record.
    Mr. Bonilla. Thank you, Mr. Boyd. Again, Mr. Boyd is 
reflecting the views of perhaps every member of this 
subcommittee.
    Mr. Rey. I don't think there is any ``perhaps'' about it.
    Mr. Bonilla. I only hedge it somewhat, because there have 
been a couple of members who have not shown up for the hearing.
    Mr. Boyd. Mr. Chairman.
    Mr. Bonilla. Yes, Mr. Boyd.
    Mr. Boyd. One other thing I want to say is obviously--and I 
have known this for a long time, that Mr. Mark Rey is a very 
quick study.
    Mr. Bonilla. The word around town is as much.
    Mr. Farr. Mr. Chairman?
    Mr. Bonilla. Yes, Mr. Farr.

                          Forest Service Issue

    Mr. Farr. I have one other question before we go to the 
vote, and let me read this. My office has been contacted by--I 
know this is in your bailiwick, but not under this committee's 
jurisdiction. It is in regards to the forest service and it is 
Los Padres National Forest out in my district. Both by letter 
and by person of several employees of that forest, concerning 
the management practice of the former supervisor Jeannine 
Derby, these employees have expressed concerns to me about what 
they believe a hostile work environment created by Ms. Derby's 
management, in particular, several have cited the climate where 
harassment goes unpunished and where victims who complain are 
subject to various forms of workplace retaliation. I am not in 
the position to judge the individual merits of these 
complaints, but I have concluded that there is enough smoke 
that there must be some fire there, and I understand that the 
forest service has initiated several internal reviews of the 
problems, and I ask that your office advise me as soon as 
feasible as to the results of these reviews, and further ask 
that the--keep me informed on the steps that will be taken to 
fix any of the problems that you might identify out there.
    Mr. Rey. We would be happy to do that. We have a new 
regional forester in California, and dealing with this, and 
some similar personnel issues is one of his top priorities. He 
came on board the first of the year.
    Mr. Farr. I appreciate that.
    Mr. Rey. At some point when we have got some results, we 
will make an appointment with you and go through them.
    Mr. Farr. Okay. When I come back from the vote, I want to 
talk more about watersheds.

                               FARM BILL

    Mr. Latham [presiding]. Good morning. You are very 
fortunate. I think we are going to have a short hearing this 
morning. I just had a couple questions. I guess on the farm 
bill, it would appear that both versions really have competing 
interests, real strong commodity title and a real strong 
conservation title. And I would be curious if you have done any 
kind of background or research or--Pearlie, I don't know if you 
have information on it, but how is this going to shake out with 
all of the incentives in both the House and the Senate bills 
for production? Strong incentives on conservation? Have you 
seen where one side--I mean, both side is fully funded, 
basically. How do we resolve that?
    Mr. Reed. I have what I would consider to----
    Mr. Latham. And also tell me about farmland.
    Mr. Reed. First, I would like to defer to Mr. Rey. I think 
he would be the person to first address your question.
    Mr. Rey. The administration is committed to a fully funded 
farm bill that is consistent with the budget resolution 
limitation. We would like the funding levels to be even 
throughout the life of the farm bill so that the money is not 
front-loaded in a way that it diminishes the baseline funding 
in the outyears. Within that overall limitation, we think there 
is sufficient funding, both to meet our obligations to farmers 
in the commodity programs, as well as to mount a robust 
conservation effort. Discussions are ongoing about the balance 
between the two, and that is probably not a question we can 
unilaterally answer, given the status of the conference. But I 
think that I can say one thing, and that is whatever emerges 
from conference will be the strongest congressional commitment 
to conservation programs since the dust bowl era. Assuming that 
it fits within the budget resolution, it will be signed by the 
President, and it will be our honor to embark on a program of 
conservation that will far exceed what many of us thought 
possible a year or 18 months ago.
    Mr. Latham. Do you share my concern that--and I am an Iowa 
farmer. I live on a farm a mile outside of the big town of 
Alexander there, 167 people, and just being a farmer myself, if 
the incentives are there for full production, and Senator 
Harkin's staff person has said that that will bring in--their 
bill would bring, according to their study, a little over 2 
million acres into production. I know my neighbors, and I know 
the way farmers like to grow corn and soybeans in our part of 
the country, that with that much incentive in there in a 
commodity title, do you have concerns about the conservation 
side, that how do you compete with production? I think we are 
looking at a bill--it becomes more apparent to me that if you 
are a fertilizer chemical dealer, you have got a really good 
deal coming.

                       COMMITMENT TO CONSERVATION

    Mr. Rey. I think the commitment to conservation in both 
bills is real, and designed to fit within the budget 
resolution, there will have to be some give, both in the 
commodity programs and in the conservation programs. But I 
think and hope we will end up with a product that strikes a 
reasonable balance. Senator Harkin's bill is very generous to 
the commodity programs, but it is also very generous to the 
conservation programs.
    Mr. Latham. But I just know Iowa farmers, and I know my 
neighbors love to grow corn, and I would like to see the 
conservation side much stronger, myself. I don't think there is 
a balance right now. That is my major concern on the farm bill.
    Okay. In 1999 there was the USDA verdict that said that the 
NRCS misunderstood and improperly enforced the wetland 
conservation provisions of the farm bill, that the landowner is 
entitled to make improvements needed to maintain the levels of 
use, scope and effect that resulted from more far-reaching 
modifications than in the past. Have you started to enforce 
that or write new rules, or do you know what is happening?
    Mr. Reed. I believe that is the Nebraska situation isn't 
it?
    Mr. Latham. I believe so.
    Mr. Reed. We are working with that family and are in the 
process of working through, under the minimal effects 
provisions, the solution to that problem. We are also working 
with our Office of General Counsel, taking a look at the ruling 
and going back to look at everything we do to make sure we take 
what came out of that particular ruling into consideration.

                     CONSERVATION SECURITY PROGRAM

    Mr. Latham. what is USDA's estimate to carry out the 
conservation security program as included in the recently 
passed Senate farm bill for each of the fiscal years 2002 on? 
How much of the total would go towards technical assistance for 
each of the fiscal years 2002 through 2011? Would all the 
technical assistance be carried out by the NRCS? That is an 
easy question for you, Pearlie. Come on.
    Mr. Reed. I would like to defer it to the Secretary. But 
let me take a quick shot at it. We are developing those 
estimates. If you are interested in the details, I could ask 
our deputy chief of programs, Tom Weber, to come up, or we 
could follow up and provide that to you. And, with respect to 
us carrying out the technical assistance to do the work, we 
know that we don't have the wherewithal to do that. We are 
looking into third-party vendor provisions that we think will 
come out of the farm bill, as well as all other options that 
might be available to us in working with our partners to get 
the work done.

                      BUDGET FOR UNDER SECRETARIES

    Mr. Latham. Okay. Thank you. Mr. Rey, I know the account 
for the Under Secretary is a small part of the overall budget 
request, but on the department-wide basis, the request appears 
to be in excess of $55 million over the funding level 
appropriated in fiscal year 2002. Do you think the increases 
should be devoted to offices here in Washington, or do you 
think that the increases should be devoted to the field where 
the programs are delivered?
    Mr. Rey. You said $55 million over. I assume you meant 
$55,000 over 2002.
    Mr. Latham. Apparently it is $55 million on all of the 
Under Secretaries.
    Mr. Rey. I see. The Office of the Secretary item 
generally----
    Mr. Latham. $55 million.
    Mr. Rey. $55 million. Generally speaking, we are about 
putting resources to the ground, and that is a consistent 
thread throughout the USDA budget, particularly with the 
Natural Resources Conservation Service and the Forest Service, 
the two agencies that this mission area oversees. The increases 
in the Office of the Secretary's account are, I think, as a 
result of two things, and I will let Mr. Kaplan elaborate on 
these. One is some accounting changes, or putting costs of 
certain functions in the personnel area back to departments and 
agencies. You will find these increases in not only the Office 
of the Secretary's budget, but in other budgets as well.
    The second thing I think is a function of a different 
management philosophy in the Department. And that is, we are 
not asking the agencies to account for as many individuals that 
we are bringing on as Schedule C appointments, as has been the 
case in previous administrations.
    With that, I will acknowledge my lack of expertise in the 
overall Office of the Secretary budget line, and turn to Mr. 
Kaplan to elaborate.
    Mr. Kaplan. The staffing in the Under Secretary's Office, 
Mr. Rey's and the other Under and Assistant Secretaries is 
maintained from 2002 and 2003. There is money for pay costs, 
there is money for inflation. The biggest increase in the 
Office of the Secretary is $28 million for security 
improvements.
    Instead of trying to put money in all of the agencies' 
budgets to continue what we have gotten in the homeland, 
security supplemental in 2002, there is a lump sum in the 
Office of the Secretary that she can use wherever it is needed 
in 2003 to move along the security improvements at the 
Department of Agriculture.
    There is also an increase of $5 million for streamlining 
costs. As we try to downsize and co-locaate more offices, we 
wanted a pot of money to be able to cover some of the costs in 
order to streamline our programs.
    So it is not that we are adding people in the offices 
themselves, these are program areas that we funded out of the 
Office of the Secretary.
    Mr. Latham. In the Office of the Under Secretary, there is 
an increase of $152,000--that is not that many dollars--for 
unspecified programs and other activities. There is no real 
clear information about what it is. Can you give us any 
enlightenment? And we will be asking a lot of folks what those 
dollars are, that $152,000.
    Mr. Kaplan. It is cost to maintain 6 staff years in the 
Under Secretary's Office. There are pay costs, there is a 
salary adjustment because salaries go up, there is the shift of 
retirement costs.
    Mr. Latham. There is no line that just says ``Program'' and 
``Other.''
    Mr. Kaplan. Well, there is a table in our explanatory notes 
that does break it out between pay costs, salary adjustments, 
inflation and things like that. But the idea is just--to fund 
the 6 staff years that are in the office today. But we will 
supply more information for the record.
    [The information follows:]

    The Under Secretary's office has an increase of $20,000 for pay; 
$57,000 for salary adjustments; $2,000 for inflation and $93,000 to 
ensure that he can fill vacancies with qualified individuals and pay 
office expenses. The total request for this office is $923,000.

    Mr. Latham. I would recognize the gentleman from Virginia, 
Mr. Goode.

                        Watershed Rehabilitation

    Mr. Goode. Thank you, Mr. Chairman.
    Let me ask you this, Mr. Under Secretary. In the funding 
for dam rehabilitation, you know, the program that we passed 
last year, and it was 25 million, you cut that and several 
other things in the soil and water conservation districts, and 
there is much concern. Tell me what your rationale was on doing 
that. Why?
    Mr. Rey. The cuts that are resulting in the greatest degree 
of concern are in our watershed program accounts, watershed 
operation accounts. And as I indicated earlier, the discussion 
within the administration about the funding for those accounts 
was perhaps the most difficult part of the development of the 
NRCS fiscal 2003 proposal.
    That is not new this year. Those accounts were reduced by 
50 percent in 1994 on what was to be a one-time basis. That 
turned out to be a continued flat lining of the account.
    In 1994, we were responding to other priorities associated 
with flood conditions that were particularly difficult that 
year. In this budget cycle, we are responding to other 
priorities for Federal funding that are equally or even more 
difficult. And so consequently, as we rate our priorities, 
those programs resulted in cuts.
    At the same time, as I also indicated earlier, we are 
mindful of the fact that those programs enjoy considerable 
support within Congress. Indeed, those programs were 64 percent 
earmarked in the 2002 budget cycle, which is a reflection of 
strong congressional support.
    So we understand that. We are going to continue to discuss 
funding for those programs as this budget cycle unfolds, this 
being the beginning, not the end of that discussion.
    Mr. Goode. You mentioned the watershed cuts. But let's go 
back to the dam rehabilitation. Do you lump that in with that 
too, and you--it just--it was tough, of course, you had to make 
the cuts.
    Mr. Rey. It is all part of the same program.
    Mr. Goode. In a number of States you will acknowledge that 
there are dams that are in bad need of repair?
    Mr. Rey. There is no question that we have a large backlog 
of rehabilitation needs. That reality raises two underlying 
questions that I think we will be exploring as we discuss this 
budget area over the course of the year.
    First, in light of that, should we be devoting additional 
new funds to new watershed structures? And that is what those 
accounts were providing for in previous cycles.
    And, second, in light of this large backlog of 
rehabilitation needs, a backlog that everyone understands with 
the most generous budget scenarios we would only be able to put 
a small dent in, what priorities should we place on which 
facilities we rehabilitate first?
    Mr. Goode. Let me ask you this. Do you place a higher 
priority on building new structures or taking care of what you 
got?
    Mr. Rey. My personal view is, given the backlog of 
rehabilitation needs, we probably are faced with an 
appropriation where if we have to make that choice, we ought to 
be looking to rehabilitation first.
    Mr. Goode. And the 25 million that was in the budget last 
year, that was for rehabilitation, was it not?
    Mr. Rey. I don't think it was 25. I think it was closer to 
$10.
    Mr. Goode. Yes. I think 25 was maybe what we hoped for and 
ended up with that.
    Mr. Rey. Twenty-five was, I think, the authorization; 10 
was the appropriation.

                Conservation Reserve Enhancement Program

    Mr. Goode. Okay. Let me ask you this about the CREP 
program. A number of farmers in my area in the Fifth District 
of Virginia, Nelson County being one, Albermarle County being 
another, Green County being another, have participated in that 
program. And someone here in Washington is holding up those 
funds, which I understand are available, but it has to do with 
their interpretation of well digging. Can you make a comment on 
that?
    Mr. Reed. If you are talking about the Conservation Reserve 
Enhancement Program it is an FSA issue, that we will have to 
follow up on.
    Mr. Goode. Can you see, if you can, what the problem is, 
because the farmers went into this to get the cows off the 
streams. You have got to have a well source away from the 
stream, and they included the paying for drilling the wells as 
part of the CRE program. Now those farmers that have wells as 
part of their conservation measures are not--they are not 
releasing the funds for that.
    Mr. Reed. We will follow up with the FSA folks this 
afternoon and get back to you.
    Mr. Goode. Thank you.
    [The information follows:]

    After the Appropriations Hearing, the National Resources 
Conservation Service (NRCS) contacted the Farm Service Agency (FSA) and 
received a status report on Congressman Goode's request concerning the 
release of funds in the Conservation Reserve Enhancement Program (CREP) 
in the Fifth District of Virginia.
    FSA did suspend the approval of CREP contracts in Virginia, 
particularly where wells were planned. At the time, Viriginia was not 
adhering to the CREP policy that prohibits drilled wells as part of 
this program. Subsequently, FSA has established CRP policy that allows 
for the drilling of wells. This policy change is reflected by CRP 
Notice Number 396 issused and made effective on March 1, 2002. A copy 
of the CRP Notice is provided for the record.

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



                             New RC&D Areas

    Mr. Bonilla [presiding]. Thank you, Mr. Goode. I wanted to 
raise one issue that I think was received very well by most 
members of the subcommittee, and beyond; the USDA announcement 
last month of the 20 new RC&D areas that would be covered by 
new projections. There are dozens of counties as I look at the 
list here in those areas, dozens of counties that will benefit 
from those new projects.
    My question is, what level of funding is needed to fully 
support this program and to take in these new projects?
    Mr. Rey. The administration's budget request provides 
funding for all of the existing areas including the 20 that 
were approved earlier this year.
    It does not include funding for any new projects for fiscal 
year 2002. And we can provide you with the data. I think it 
probably would require about $66 million in total to fund both 
the existing projects--66.4 million, my memory only goes to the 
first two decimal points--66.4 million to fully fund existing 
projects as well as to favorably respond to the new proposals 
that we anticipate during 2002, some 20 or so new projects for 
that year.
    Mr. Bonilla. I have a couple more questions I will submit 
for the record.
    I will yield once again now to Ms. Kaptur.

                          Reprogramming Funds

    Ms. Kaptur. Thank you, Mr. Chairman. Mr. Secretary, you 
talked about the potential to reprogram funds within the Agency 
in the event that you could not make the $30.8 million in 
administrative efficiencies.
    How would you reprogram? Where would you reprogram from in 
order not to hurt conservation operations?
    Mr. Rey. Well, I think that your question was if we don't 
achieve those efficiencies, will there be a shortfall in 
Conservation Operations? And our expectation is that at this 
point, no. The question would be if we don't make the 
efficiencies, and therefore have higher administrative costs, 
where would we secure the additional funding?
    The short answer is that I don't know that I could tell you 
that right now, because that would be the kind of decision that 
we would be looking at mid-year, but it would be dependent on 
where we have unexpended balances. But I can assure you, based 
on the committee's reprogramming requirements, that you would 
have to approve whatever we suggested by way of fund transfers 
to meet any shortfalls that occur.
    Ms. Kaptur. Those fund transfers would come out of 
conservation operations?
    Mr. Rey. Not necessarily. If again, if we had to make a 
reprogramming request to the committee, the reprogramming 
request would probably be one that looked across our program 
accounts to see where we had unexpended balances that we didn't 
think we would expend by year end in money that was 2003 money. 
Those would be the first priorities.
    As I said, I don't know that I could predict that for you 
right now. But clearly if we do get to that point--and in 
parenthesis, I hope and don't see that we do--but if we do get 
to that point, any reprogramming will be before you as a 
committee, and not something we do as a matter of course.

                  Conservation Operations--A priority

    Ms. Kaptur. Well, I just wanted to urge you--I read your 
testimony and your involvement in the proposals for the farm 
bill and overall departmental policy and so forth. When you 
look at the amount of money that the American people are 
shelling out across this country to keep agriculture propped 
up, we don't have a market solution to agriculture here, we 
have a government solution. So we are farming the government, 
we are not farming the market. As a minimum, we ought to be 
getting much more in terms of conservation for those dollars 
that are going out. I would urge you not to cut in the 
conservation area but to find ways, in fact, to use the 
billions and billions in support that are coming to the 
agricultural sector to exact more in the way of conservation. 
And we certainly will look at any follow-up from the Department 
on this. On Mr. Walsh's comments and others on this whole issue 
of land toxicity, water table penetration by toxics related to 
animal feeding, I want to urge you to do whatever you can. 
Coming from the Michigan School of Natural Resources, you 
understand the connect here that Michigan is draining on Ohio. 
So I will get real regional about this.

                  Impacts of Animal Feeding Operations

    If we look at the CAFO operations in cattle and dairy that 
have been placed on that western side of Michigan now, what is 
happening is the water table drains into my district and 
adjacent to my district. And counties like Williams County at 
the Michigan-Ohio line are really deeply worried about their 
aquifers. At the same time, we have a number of Dutch dairies 
now locating in western Ohio, and they are large. And they are 
acquiring just enough cattle--I am trying to remember what the 
number is. If the regulation start at 1,000--then they are 
buying 999. I mean, this is what is going on in western Ohio.
    My question to you is, how do we work with RC&D so as 
rather than getting a fight--let me give you one other example. 
We have got Buckeye Egg now, a German firm that can't do 
business in Germany because it was such a bad actor. Ohio 
welcomed them. They are now the largest egg producer in Ohio, 
and Ohio is a leading egg producing State. But the problem is 
they are an enormous polluter. So our State attorney general 
has Buckeye Egg in court right now, and we have got all of 
these environmental problems that attend to this particular 
facility. That is poultry. I mentioned dairy earlier.
    How do we work with you? How does my region work with you? 
It is Michigan, it is Ohio. How can we be proactive, to get 
RC&D out there in front, to help us find a better answer? 
First, to test the water systems that are being polluted--how 
bad is it--but then to develop a management plan before all of 
those places open up? Could you enlighten me as to the system 
that currently exists so we can be more proactive, rather than 
just ending up in court, which is what our attorney general has 
done on this Buckeye Egg situation. How do we use the tools 
that you currently have to help us in our region, not harm the 
water, clean up the mess that has already been generated, and 
not allow the soils to become toxic? How do we use the tools 
that you have to do this?
    Mr. Rey. The two initiatives that will contribute the most 
to the problem that you are describing are the CAFO regulations 
that EPA and we are working on together to develop an 
understandable and farmer-friendly regulatory tool that doesn't 
exist at present. And second, the delivery system that we 
believe will be provided by the increases in amount and the 
utilization for technical assistance to animal feeding 
operations combined with EQIP money in the farm bill that is 
currently before Congress.
    It is our hope that the two of those together will set us 
off in a new direction toward addressing what I consider to be 
one of the most rapidly developing environmental problems that 
we have today; that is, the concentration of operations in the 
animal feeding industry.
    Ms. Kaptur. I know my time has expired. But I wanted to see 
if Mr. Reed wanted to add to the answer, what this means. Do we 
have to wait maybe another year? My problem is existing, it has 
existed for a while. What do I do while I am waiting for all of 
this? And what does the rest of the country do while we wait 
for EPA and wait for the CAFO regulations? What do you do now?

                      Conservation Infrastructure

    Mr. Reed. I really don't have anything to add to what 
Secretary Rey said, other than you made reference to RC&D maybe 
being a tool that we can use. And I would add to that that all 
of our partners in this soil and water conservation 
infrastructure that we have out there right now are in an 
informal way collectively working on those issues. I think we 
need to continue to support and nourish that voluntary approach 
to dealing with the problem.
    Ms. Kaptur. Well, let me just say as you think about this 
question, I would appreciate any recommendations for what our 
particular region of the country could do while we are waiting 
for more advanced development of these regulations and so forth 
and the passage of EQIP and so forth to prevent further damage 
and to try to remediate the damage that has already been done. 
And so any further enlightenment you can provide me there on 
existing programs that we can use would be greatly appreciated. 
Thank you.
    Mr. Bonilla. Thank you, Ms. Kaptur. Mr. Boyd.

                    Farm Bill Conservation Programs

    Mr. Boyd. Thank you, Mr. Chairman.
    I would like to ask this question to both Secretary Rey and 
Chief Reed. As you know we are conferencing a farm bill now, or 
about to conference a farm bill. If you were king for a day and 
could write the section of the farm bill that applies to 
conservation of our natural resources and environment, how 
would you do it? What programs would you keep, eliminate, 
change, add money to, take money away from? That is a very 
simple question. Just what is your vision for how we, for the 
next 7 years or 8 years, how we deal with our natural resources 
conservation?
    Mr. Rey. I find the problem with answering "if you were 
king for the day" questions is that you end up spending the 
rest of the day in the dungeon.
    But I think, generally speaking, both bills have provisions 
that are going to take us a long way to improving our 
conservation programs. And there are some provisions in the 
Senate bill that we prefer over the House language. There are 
probably more provisions in the House bill language that at 
least in terms of simplicity and flexibility look to us to be 
preferable.
    But I think the better answer to the question is that 
either bill makes such a pronounced advance in conservation 
operations that the best thing that can happen is that we 
resolve the differences between the two bills quickly and begin 
to put the results of that collaboration on the ground as fast 
as possible, particularly to respond to developing situations 
that Ms. Kaptur has pointed out.
    Beyond that, I would be happy to share with you the side-
by-side comparisons that we have. It is not a situation where 
one or the other body's bill is, unfortunately, superior to the 
other. There are provisions in each that are worthy of support.
    Mr. Boyd. Thank you, Mr. Rey, I got the answer that I 
suspected I would get. And that is okay.
    Chief Reed.
    Mr. Reed. If I were King for a day. I would make sure that 
there are no unfunded mandates coming out of the process. And 
as a part of that, I would make sure that the full costs of 
carrying out these programs that are authorized are provided 
for in some way.
    Mr. Boyd. But nothing jumps out in terms of the programs 
themselves that you would add or take away--you think the----
    Mr. Reed. I think in both the House and Senate versions, 
there is a good mix. And I think we can use whatever comes out 
of what is there now and integrate it in such a way so that we 
can make it all farmer-friendly. So I think it is good.
    Mr. Rey. There is one provision in the Senate bill that I 
think is worthy of serious consideration by the House. And that 
is the reauthorization of a 501(c)(3) foundation to work with 
NRCS to bring private sector dollars, which are not currently 
flowing into the system, into conservation operations. And it 
would be, I believe, very helpful if the House were inclined to 
entertain the Senate's vision there, with whatever changes you 
think are necessary, and give us the opportunity to create that 
foundation and to begin to expand on the public-private sector 
collaborations that we already have in the conservation area. 
Because I think with some creative activity, we can bring some 
dollars into conservation operations that aren't there right 
now. And they would not be taxpayer dollars in this case.
    Mr. Boyd. Thank you. May I follow up with one additional 
question for Chief Reed?
    Mr. Bonilla. Go right ahead, Mr. Boyd.

                        Florida Farm Foundation

    Mr. Boyd. Chief, there is a program that you all have been 
involved in, and I am not sure which section it is under. 
However, there has been a collaboration with a group called 
AFAM which is part of the Florida Farm Foundation which--you 
are familiar with that.
    Mr. Reed. I am.
    Mr. Boyd. Would you comment on the effectiveness of that? 
Also I understand there have been some internal problems in 
AFAM. How is that affecting your thought process about our 
involvement in that?
    Mr. Reed. Mr. Boyd, the details I don't know. But we have 
Larry Clark, who is our deputy chief of science and technology, 
leading that effort. If you would like, we can ask him to come 
up and respond to the question, or we can follow up and provide 
information for you for the record.
    Mr. Boyd. Maybe we can do some of both. It would be great 
if the Chairman would allow me the time.
    Mr. Clark. Thank you, Mr. Boyd.
    The AFAM project is one that we started a year or so ago 
and has been producing some very innovative approaches to 
dealing with some of the animal waste issues in Florida and 
North Carolina. We think there is a great deal of opportunity 
to continue that effort to partner with others--non-profits--
who can carry out this kind of activity.
    The problems and issues in the organization have pretty 
much been resolved, and we are happy to see the cooperative 
effort continue.
    Mr. Boyd. Thank you very much.
    Mr. Reed, do you have anything to add?
    Mr. Reed. No.
    Mr. Boyd. Mr. Chairman, if I could ask Secretary Rey to 
submit for the record the side-by-side comparisons of the House 
and Senate--your part of those titles.
    Mr. Rey. What you will find, it is a provision of the 
summaries side by side.
    Mr. Boyd. No recommendations?
    Mr. Rey. No.
    [The information follows:]

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    Mr. Bonilla. Thank you, Mr. Boyd. I do believe we have one 
remaining round of questions from Ms. Kaptur based on our 
informal survey of members. I believe that that will be the 
final round, Mr. Rey and Mr. Reed. Ms. Kaptur.

                  PRIVATE LAND CONSERVATION ACTIVITIES

    Ms. Kaptur. Thank you, Mr. Chairman. Mr. Rey, if I were to 
go into an audience of people who are not trained in your 
profession, and I were to try to simply explain to them how the 
jurisdiction you cover is different than the Department of 
Interior in terms of forestlands as well as land conservation, 
how would you describe the extent of coverage of the activities 
over which you have jurisdiction versus the Department of 
Interior? What about numbers of acreage of forestland, land 
held in the public domain versus the private domain, 
conservation programs? How would you give people a sense of the 
scale of that?
    Mr. Rey. What I have described to people is that as far as 
private land conservation activities are concerned, that is the 
almost exclusive domain of the Department of Agriculture.
    There are limited programs of a specific nature, for 
instance wildlife-related programs, that are administered 
through Interior. But for broad purposes, if you are talking 
about private land conservation, the Natural Resources 
Conservation Service is the government's leader and occupies 
most of the field in that regard.
    With regard to Federal lands, what I have told people is 
that, generally speaking, the Federal Government manages on 
behalf of the American citizens roughly a third of our Nation's 
lands. There are four major land managing agencies that have 
the responsibility for that estate. Three of them are in the 
Department of the Interior, one in the Department of 
Agriculture.
    In the Department of the Interior, two of the agencies have 
specialized holdings, the National Park Service and the Fish 
and Wildlife Service, which manage the national park system and 
the national wildlife refuge system.
    The third is the Bureau of Land Management which manages 
what remains, which we call the public domain, which has not 
been reserved either for the parks, wildlife refuges, or in the 
case of the Department of Agriculture, the national forest 
system.
    And that is pretty much how we describe it. Each of the 
agencies has a somewhat different purpose. The purpose of the 
Bureau of Land Management and the Forest Service are the most 
closely comparable in the sense that both agencies have a 
mandate to accommodate a variety of uses as they go about 
managing the lands to which they are entrusted.
    The Park Service and the Fish and Wildlife Service have a 
somewhat narrower mandate: in the first case, the enhancement 
of wildlife populations through the management of the refuge 
system; in the second case, the preservation of America's parks 
for the enjoyment of the public, not only the American public, 
but citizens of the world.

                   PRIVATE VS. PUBLIC LAND TREE COVER

    Ms. Kaptur. If you were to fly over from coast to coast and 
look at the tree cover in the United States and ask yourself, 
in the public domain, how much of that tree cover is managed by 
the Forest Service versus the Department of Interior, where is 
the acreage greater?
    Mr. Rey. The acreage is by far greater with the Forest 
Service. The Bureau of Land Management lands tend to be lower 
elevation, dry grasslands. There are exceptions. I am speaking 
in broad generalities now. The forests, which were the origin 
of the national forest system, were created in large part at 
the turn of the century by taking higher elevation areas with 
forest cover and removing them from the public domain to place 
them in forest reserves for, at that time, two primary 
purposes: to provide for watersheds and water supply stability, 
to provide for a sustainable supply of fiber resources.
    So if you are flying east to west, at the point that you 
are flying over the eastern forest today, the acreage you are 
looking at, predominately although not exclusively, is 
privately owned lands. Once you cross the 100th meridian, you 
are looking at grasslands. Once you get into the inner mountain 
area past the front range of the Rocky Mountains, what you see 
forested is predominately in Forest Service ownership. What you 
see in grasslands is predominately either private land or 
Bureau of Land Management public domain land.
    And then finally, once you reach the West Coast, you cross 
the Sierras, the forested acreage that you are seeing is a mix 
of Forest Service and private land. The unforested acreage is 
predominately private agricultural lands.
    Ms. Kaptur. And if you were to put it on a percent scale of 
those--let's talk about the forested or tree-covered lands over 
which you have jurisdiction. What percent of the total would be 
within USDA's and Interior's jurisdiction?
    Mr. Rey. I think it is, roughly speaking, three-quarters 
Interior, one-quarter USDA; because, by far and away, the 
Bureau of Land Management owns the largest estate.
    Ms. Kaptur. Okay. All right. I am going to ask you to 
provide some of those numbers for the record, talking about 
crop land, grazing land, forestland, and so I can get a clear 
picture in my mind of the overall breakdown.
    [The information follows:]

    The Forest Service manages approximately 192 million acres of 
public land--an area about 110 percent the size of the State of Texas--
located in 44 States, Puerto Rico, and the Virgin Islands. These lands 
are known collectively as the National Forest System (NFS). 
Approximately 110 million NFS acres are classified as rangeland, 
although a large portion of these lands are also forested. Of the 
rangeland acres, 92 million are classified as grazing allotments of 
which 84 million acres are active allotments. National Grasslands are a 
separate component and occupy 831,000 acres.

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                 LAND COVERED BY CONSERVATION PROGRAMS

    Ms. Kaptur. I am also going to ask you to provide some 
numbers for the record on the various conservation programs 
that you administer to incorporate the amount of acres and the 
kind of technical assistance available to people, so I can get 
a handle on the magnitude of this and who holds responsibility 
for those lands.
    [The information follows:]

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                             BIOBASED FUELS

    Ms. Kaptur. Though the Forest Service itself is not under 
our jurisdiction, they manage one of the largest vehicle fleets 
in the Government of the United States. And I am very 
interested in the biofuels issue and the use of forest residue 
for the production of biofuels.
    I want to ask you, how much do you know about the 
composition of vehicles within the Forest Service; to what 
extent any of them use biofuels, ethanol, biodiesel, in either 
acquiring vehicles that use them or currently vehicles under 
their jurisdiction using that type of fuel? In other words, can 
you be a partner as a part of the Department of Agriculture in 
our efforts to really promote biofuel production through our 
national energy policy and through the farm bill?
    Mr. Rey. Clearly we can be and want to be a partner in 
promoting the use, the development and use of biofuels. And if 
you look at the Forest Service budget, you will see additional 
recommendations for research appropriations in the development 
of biofuels.
    I cannot today tell you whether and what the percentage of 
the Forest Service fleet uses biofuels, but I will get you that 
information for the record.
    One of the things about the Forest Service fleet, as 
opposed to the inventory of vehicles nationwide, is that our 
fleet tends to run more heavily toward 4-wheel drive and 
utility vehicles, pickup trucks, because of the terrain that 
they are required to traverse. And to the extent that we are 
focusing more of the effort on developing mixed fuel vehicles 
in the general passenger vehicle category, that won't be 
necessarily something that our fleet will accommodate to the 
extent that passenger fleet as a whole will be. But I can get 
you specific numbers.
    [The information follows:]

    The Forest Service (FS) owns and operates a fleet of approximately 
19,000 vehicles, which includes heavy equipment, off-road vehicles, 
snow machines, boats and airplanes. Passenger carrying vehicles make up 
approximately 3 percent of the total fleet and work trucks comprise 
another 86 percent of the fleet. Included in the FS vehicle fleet are 
more than 150 alternative fuel vehicles. The alternative fuels used in 
these vehicles include compressed natural gas, liquid propane gas, 
propane gas, methanol, ethanol and electricity. FS also operates more 
than 4,000 vehicles with diesel engines that can run on bio-diesel 
products. FS uses on an annual basis approximately 60,000 gallons of 
alternative fuels in its fleet vehicles. Executive Order 13031--Federal 
Alternative Fueled Vehicle Leadership--requires that 75 percent of 
nonexempt vehicles acquired by Federal agencies for use in metropolitan 
statistical areas with populations of 250,000 or more use alternative 
fuels. Approximately 90 percent of the nonexempt vehicles FS acquires 
for use in these areas are alternative fuel vehicles. The remaining FS 
vehicles are associated with law enforcement or fire activities, are in 
lesser populated areas, or meet other conditions that exempt them from 
the Order. Long-range acquisition plans include the annual purchase of 
more than 50 alternative fuel vehicles.

    Ms. Kaptur. I come from a district that makes a lot of 
truck transmissions. I would urge you to engage with those in 
the administration who are involved in this new freedom car. We 
had the old partnership for a new generation of vehicles. And I 
really think that you have something to contribute here. And 
certainly as we clear residue from many of our forests, and you 
have this enormous passenger power for fuel within your 
service, I think that you can be part of the solution. I would 
urge you to look at that at the highest levels of your 
responsibility.

                              URBAN SPRAWL

    I want to move to the issue of urban sprawl. If I might ask 
you or Mr. Reed, what programs you have in place to assist 
local, State, and regional efforts to effectively deal with 
urban sprawl?
    Ohio, as you know has more urban areas than anywhere, and 
farming is our largest industry, farming and food processing. 
We really do have enormous conflicts. We are sort of at the 
point of making final choices as to what the land will look 
like 100 years from now, and it is actually a very painful 
process.
    I am just curious to what extent NRCS is involved in 
assisting communities and States in this regard. What types of 
programs do you have underway or are considering to help 
provide the technical assistance and help for township trustees 
and land conservers and conservation groups that are trying to 
get a handle on this and how to be proactive in establishing 
land trusts and development rights and so forth, farmland 
protection? How do you deal with this?

              FARMLAND PROTECTION--FOREST LEGACY PROGRAMS

    Mr. Rey. The two premiere programs that we operate are the 
Farmland Protection Program, and the Forest Legacy Program. 
Both programs provide financial assistance on a cost-share 
basis to purchase easements of farm and forestlands, 
predominately those that are threatened by urban sprawl. And 
those are program areas where both in the case of the Forest 
Service fiscal 2003 budget, we are recommending significant 
increases in funding.
    Ms. Kaptur. How much is that, please?
    Mr. Rey. We are recommending $70 million for fiscal 2003, 
which would be roughly a 20 percent--18 percent increase over 
2002 levels. Additionally, both the Farmland Protection Program 
and the Forest Legacy Program are scheduled for healthy 
increases in the farm bill that is currently in conference.
    Ms. Kaptur. What are you asking for in the Farmland 
Protection Program, and is that an increase over last year?
    Mr. Rey. In the Senate bill, the provision is for $150 
million in 2002, $250 million in 2003, $400 million in 2004, 
$450 million in 2005, and $500 million in 2006. That is a 5-
year bill, so that is as far as it goes.
    The House bill provides funding at $50 million per year 
through 2011. That is a 10-year bill. So it provides monies 
spread over a longer time horizon. And what did we spend this 
past year on farmland protection? This past year we spent $17.5 
million in farmland protection. So either bill represents a 
pretty dramatic increase in the Farmland Protection Program.
    Ms. Kaptur. All right. Is there any summary that is 
available from the Department as to how those Farmland 
Protection-Forest Legacy dollars have been used over the years? 
I don't need a lengthy report, but to get a sense of how those 
dollars have been used, so one can talk about it intelligently 
to the public, which States have participated, which have not, 
what you expect from the States or localities. I know in our 
own State, one of the tragedies is Ohio seems to be not leading 
but following the pack on this. They didn't even have 
legislation in place, and so even if you had regions of a State 
that were interested in participating, if the State government 
wasn't interested, you couldn't do anything regionally, which 
was a great frustration of ours in our part of the State. And 
the State finally got its act together, but they are very late.
    And so any enlightenment you can provide there will be 
greatly appreciated.
    [The information follows:]

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                           WATERSHED PROGRAMS

    Ms. Kaptur. I also support my colleagues on their concerns 
about the watershed programs. I think those are all of my 
questions, and we thank you so very, very much. We hope that 
your tenure is a very successful one, and we ought to get you 
written up in the Michigan Alumni Magazine if it hasn't already 
been done, a famous graduate of the School of Natural 
Resources.
    I wanted to say to Chief Reed, it is always a pleasure to 
have you here, and your thoroughness and your professionalism 
and your 81 percent grade are a tribute to the fine work that 
has been done by NRCS over the years. And we hope you come back 
very often here. We enjoy having you.
    Mr. Bonilla. Thank you, Ms. Kaptur. We have now been joined 
by Mr. Nethercutt, so I will now yield.
    Mr. Nethercutt. Thank you, Mr. Chairman. Members of the 
panel, welcome. I apologize to you for being late. We have had 
three hearings going on. I know the Chairman does also, and 
other members, so thank you for being here. I am sorry to have 
missed your testimony, but I have been told what you said, so I 
am ready to ask a couple of questions that I hope will be of 
interest to you.

                              AIR QUALITY

    My understanding is there has been discussion in the whole 
area of conservation relating to water and land conservation. I 
would ask anyone on the panel, to what extent do you believe 
air quality should also be a subject of concern as it relates 
to conservation? Out our way, we have the issue of stubble 
burn. That is a controversial issue. But what can you tell us 
about what the Department is doing with respect to the subject 
of air quality, and to what extent is there collaboration going 
on with interested parties as it relates to air quality 
conservation as opposed to land and water conservation?
    Mr. Reed. Mr. Nethercutt, as you know, the Chief of NRCS 
serves as chairman of the USDA Air Quality Task Force. We have 
a very, very strong task force. I would like to just cover two 
or three major accomplishments of the task force.
    First, we have developed priorities for research. The 
research priorities focus primarily on particulate matter, PM 
210, PM 2.5, as well as issues dealing with animal odors and 
emissions. We are in the process of pulling together a good 
solid set of recommendations centered around voluntary 
incentive-based air compliance programs in working with EPA, 
and we have also recommended a burning policy. Also we have an 
EPA representative on the task force.
    Mr. Nethercutt. I appreciate that. It is a difficult issue 
out our way. When you are growing crops that are enhanced by 
burning but yet you are facing the issue, the very emotional 
issue of air quality, and, you know, in stubble burning you see 
smoke in the air, and suddenly there is grave concern that 
children are going to have asthma attacks and so on. This is an 
emotional issue, the issue of burning. Yet notwithstanding 
that, it happens about 4 days a year, or has in our State. But 
Idaho, to the east of us, is engaged in a burning policy that 
sends the smoke our way even though our agriculture industry is 
not guilty.
    It is a tough issue. I would hope that would be a 
coordinated effort and a fair analysis recognizing that there 
is an economy here, an ag economy that we have to maintain and 
do our best to go to other opportunities for cultivation and 
production of crops without burning. I don't think it can be 
done overnight. Field burning is a tough issue that I know you 
and probably members of the entire panel are familiar.
    Mr. Rey. In some parts of the country, the air quality 
implications of agricultural operations are one of the fastest 
growing areas where we get requests for technical assistance. I 
think one of the benefits of the upcoming farm bill allocations 
will be the ability to provide some of that assistance either 
through our technical assistance accounts or through EQIP.
    Mr. Nethercutt. Am I still able to ask another question?
    Mr. Bonilla. Go right ahead.
    Mr. Nethercutt. I don't want to hold you up.
    Mr. Bonilla. You are the final member to be recognized. I 
think Ms. Kaptur also has one more question.

                          THIRD-PARTY VENDORS

    Mr. Nethercutt. I am sorry to delay. Let me ask the panel 
what your thoughts are on contracting with certified third 
parties to provide technical assistance to the land owners for 
certain practices.
    I have heard some concerns that technical assistance is 
sometimes delayed to complete projects such as inspection prior 
to timely seeding of CRP to recover crop. Delayed seeding, 
particularly in arid regions, increases the risk of a poor 
stand, and both landowners and taxpayers may have to provide 
additional funds to successfully complete the project, 
something that you all have had to address in your particular 
work. Is it something you would consider, is it a bad idea, a 
good idea, what is your sense of it?
    Mr. Reed. There are several issues, Mr. Nethercutt. Number 
1, the issue of third-party vendors is one that we have been 
participating in to one degree or the other for a long, long 
period of time. As you know, there are provisions in both 
versions of the farm bill for a more extensive use of third-
party providers to help with the technical assistance workload. 
And we are getting geared up to do just that.
    Also you mentioned CRP. FSA is in the process right now of 
conducting a pilot testing for the use of third-party vendors. 
And we, of course, will take that information and incorporate 
it in what we do as we get geared up to implement the third-
party provisions that will come out of the 2002 farm bill.
    We think that the only way we will be able to get the work 
done is to expand our use of third-party providers.

                 LAND OWNERS IMPORTANT DECISION MAKERS

    Mr. Nethercutt. Thanks. I know in your statement, your 
written statement that you made mention that the most important 
members of the conservation partnership are the people who own 
the land and make the decisions for its use. I would just 
conclude by saying I agree with you. As we look at CRP versus 
continuing land in production, CRP has a negative impact on 
rural communities that are under stress alone in terms of 
economic growth and continuation. When the land goes into CRP, 
the seed man and the farm implement guy and everybody suffers. 
Conservation of land is important. But conservation of 
productive land in production is also important as we keep 
farmers on the land and keep them growing crops as opposed to 
the alternatives. So it is a tough equation. I happen to like 
the House bill on the Conservation Reserve Program allocations 
as opposed to the Senate just for that reason. We need to have 
production agriculture flourish in this country, as well as the 
conservation side of agriculture.
    So, with that, I thank all of you for your commitment to 
the government and your assistance to agriculture.
    Mr. Bonilla. Thank you, Mr. Nethercutt. I understand Ms. 
Kaptur has one area.

                        REPROGRAMMING AUTHORITY

    Ms. Kaptur. Yes, Mr. Chairman. Just to follow up on this 
whole question of reprogramming within the Agency. For the 
record, we will just ask if you can please provide the scope of 
your reprogramming authority under NRCS.
    Mr. Rey. Sure. We can provide you that.
    [The information follows:]

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    Mr. Bonilla. Mr. Goode.
    Mr. Goode. Can I have one more question?
    Mr. Bonilla. Absolutely.

                   DAM REHABILITATION PRIORITIZATION

    Mr. Goode. To Mr. Rey. We were talking about the dam 
rehabilitation fund that has 11 million in it. Now, you are 
spending the money during this fiscal year. Who makes the 
decision on which dams get rehabilitated? You can't 
rehabilitate too many with that 11 million.
    Mr. Rey. Right. The act as passed in 2000 gives us criteria 
to use in making the prioritization of which dams are first in 
the queue for rehabilitation. And the ultimate decision, I 
think, is the Chief of the NRCS.
    Mr. Reed. Basically we have a diverse committee of folks 
from the outside that make recommendations, and we try to treat 
the worst first.
    Mr. Goode. Yeah. That diverse committee, who is on that 
diverse committee?
    Mr. Reed. Primarily the NRCS State conservationists or his 
or her representatives from the various States, plus we have--
--
    Mr. Goode. So it is at least 50 on the committee?
    Mr. Reed. No. We don't have watersheds in all of the 50 
States.
    Mr. Goode. How many are on the committee?
    Mr. Reed. I don't know the exact number.
    Mr. Goode. 35?
    Mr. Reed. 16 States.
    Mr. Goode. How much is it costing you to administer this?
    Mr. Reed. I can't tell you that off of the top of my head.
    Mr. Goode. Not even a ballpark?
    Mr. Reed. Well, we have three people working.
    Mr. Goode. It is no more than 2, maybe 1 or 2 percent of 
it.
    Mr. Reed. It is more than that when you add up all of the 
administrative costs associated with contracting and 
procurement and those kind of things. But the basic leadership 
to make sure we establish priorities of plan and scale, we have 
the equivalent of about 2-\1/2\ staff years invested in that.
    Mr. Rey. I think it is also generally a fair proposition to 
state that the highest priority in rehabilitating dams is where 
there are downstream threats to humans and property.
    Mr. Goode. I agree.
    Mr. Bonilla. Thank you, Mr. Goode.
    I am delighted this morning that we have had ample time for 
every member of the subcommittee to ask all of their questions 
that they have brought to this hearing. They are juggling 
several hearings, as Mr. Nethercutt pointed out. This is the 
appropriation hearing season and we get it done somehow, 
bounding around, doing votes and all of the other things we 
need to get done as well. I appreciate you all being here 
today. You helped us tremendously in getting this process 
started.
    Mr. Rey, Mr. Reed, Ms. Thomas, and Mr. Kaplan, we 
appreciate your time and we look forward to working with you as 
we move forward to put this bill together. Thank you very much. 
This hearing stands adjourned until tomorrow.

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                                          Wednesday, March 6, 2002.

   UNITED STATES DEPARTMENT OF AGRICULTURE MARKETING AND REGULATORY 
                                PROGRAMS

                               WITNESSES

WILLIAM T. HAWKS, UNDER SECRETARY
BOBBY R. ACORD, ADMINISTRATOR, ANIMAL AND PLANT HEALTH INSPECTION 
    SERVICE
A.J. YATES, ADMINISTRATOR, AGRICULTURAL MARKETING SERVICE
JOANN WATERFIELD, DEPUTY ADMINISTRATOR FOR PACKERS AND STOCKYARDS 
    PROGRAMS, GRAIN INSPECTION, PACKERS AND STOCKYARDS ADMINISTRATION
STEPHEN B. DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE
    Mr. Bonilla. The subcommittee will come to order.
    I am delighted today to be holding this budget hearing for 
the marketing and regulatory programs at USDA. The agencies 
under marketing and regulatory programs include the men and 
women who are charged with keeping America's agriculture safe 
from foreign pests and diseases, ensuring that agriculture 
markets are operating with the greatest efficiency by promoting 
fair and competitive trade practices that benefit consumers and 
American agriculture.

                       Introduction of Witnesses

    We have with us today Mr. Bill Hawks, the Under Secretary 
for Marketing and Regulatory Programs; Mr. Bobby Acord, the 
Administrator for the Animal and Plant Health Information 
Service; Mr. A.J. Yates, the Administrator for the Agriculture 
Marketing Service; and JoAnn Waterfield, Deputy Administrator 
for Grain Inspection, Packers and Stockyards Administration. 
And, of course, we always welcome Mr. Dewhurst, who wasn't with 
us recently.
    We understand that you had a little rough going over on the 
other side of the Hill the other day. We read about that, 
Steve. We have fun over here, and we welcome you back.
    We have read your statements and have entered them into the 
record. We will be delighted to hear from all of you in just a 
moment, but before we begin, I would like to yield to my 
friend, Ms. Kaptur, for any comments that she may have before 
we continue.
    Ms. Kaptur. Thank you, Mr. Chairman. I just want to welcome 
our witnesses and to say that you have some of the most 
important responsibilities in our country. We appreciate your 
service, and we are very anxious to hear your testimony this 
morning, and we want to help you do your job better. Thank you 
very much.
    Mr. Bonilla. Thank you very much, Ms. Kaptur.
    Mr. Hawks, we will go ahead and begin with you. We 
understand others would like to make some opening remarks and 
again we have entered all of your statements into the record. 
We will be delighted to hear from all of you this morning. We 
will begin with Mr. Hawks.

                           Opening Statement

    Mr. Hawks. Thank you, Mr. Chairman, members of the 
Committee. It is indeed a pleasure for me to be here to discuss 
the budget for the Marketing and Regulatory Programs for the 
2003 fiscal year. We do have the budgets for Agriculture 
Marketing Service, AMS; Animal and Health Plant Inspection 
Service, APHIS; and the Grain Inspection, Packers and 
Stockyards Administration, GIPSA.
    Joining me today also is my deputy from the great State of 
Texas; Jim Butler is sitting right behind me. And as you have 
already said, we have A.J. Yates from AMS, Bobby Acord from 
APHIS and JoAnn Waterfield representing GIPSA.
    I would like to start by giving you my philosophy, and that 
is working together--and I have worked with my agencies to 
draft goals for which we can be held accountable--I intend to 
see that MRP works. Those goals are, one, building broader 
bridges. We will increase cooperation and strategic 
partnerships with farmers, ranchers, States, foreign 
governments, congressional offices and other interested parties 
to ensure that our policies benefit producers and consumers 
alike.
    Second, we are intent on moving more product. We will 
facilitate expanded domestic and international market 
opportunities for U.S. agriculture products, including value-
enhanced products and products of biotechnology.
    Third, we are investing in infrastructure. An agriculture 
that is healthy both biologically and economically is 
marketable agriculture.
    Fourth, we believe in growing our people. We will make a 
concerted effort to recruit, recognize and reward 
accomplishments and inspire current and future leaders within 
MRP.
    Last, but certainly not least, is selling agriculture as a 
profession. We will creatively market the vital role that 
agriculture plays in all Americans' lives to assist our effort 
to recruit, retain the highest caliber work force for MRP and 
USDA.
    The funding sources for our agency that we are proposing 
today are funded both by taxpayers and beneficiaries of the 
program services. The total budget is nearly $1.5 billion, over 
$500 million of which is funded by user fees paid by the 
beneficiaries of the services.
    On the appropriations side, APHIS is requesting $395.4 
million, of which $13.2 million is for building and facilities. 
AMS is requesting $105.2 million, and GIPSA is requesting $42.9 
million.
    The Agricultural Marketing Service, or AMS, activities are 
an integral component of the USDA-wide effort to assist the 
U.S. agricultural industry in marketing their products and in 
finding ways to improve their profitability. Many of the 
programs administered by AMS are aimed at building cooperative 
and strategic partnerships with the agriculture community and 
State institutions that support it.
    Additionally, AMS provides oversight to research and 
promotion programs that allow producers, handlers, processors 
or importers to collaborate to solve marketing problems and to 
increase sales domestically and abroad. USDA continues to 
believe that the National Commodity Research and Promotion 
Programs offer opportunities to maintain, develop and expand 
markets.
    AMS is requesting much-needed additional funding to 
maintain the viability of the Federal seed programs and to 
bolster exports through international market price reporting.
    The Animal and Plant Health Inspection Service, as you well 
know, the primary mission is to manage issues involving animal 
and plant health, conflicts with wildlife, environmental 
stewardship and animal well-being, and I am certainly pleased 
to see the beetle on the wall back here today.
    Together with the States and industries, APHIS protects and 
promotes U.S. agricultural health, preserving and expanding 
domestic and international markets for U.S. agricultural 
products.
    Recent events have highlighted the need to protect the 
security of our agriculture production sector and our food 
supply. However, well before September the 11th and long before 
foot-and-mouth disease crippled the British agricultural 
sector, APHIS had been fully engaged in activities to detect 
and exclude agricultural health threats and ensure preparedness 
and appropriate infrastructure to address pest and disease 
emergencies that occur.
    We have indeed encountered emergencies. Just in the last 
year alone the Department released $336 million in funds from 
the Commodity Credit Corporation to address outbreaks of 
disease. Asian long-horned beetle, chronic wasting disease, 
citrus canker, karnal bunt, Medflies, plum pox, pseudorabies 
and tuberculosis.
    The Grain Inspection, Packers and Stockyards 
Administration's mission is to facilitate the marketing of 
livestock, meat, poultry, cereals, oilseed and related 
agricultural products and to promote fair and competitive trade 
for the benefit of the consumers of American agriculture.
    It helps move more product, both domestically and abroad, 
by investing in domestic infrastructure that supports marketing 
within the grain, poultry, livestock and meat industries. 
GIPSA's Federal Grain Inspection Service is requesting 
increased funding that will allow it to expand its newly 
established biotechnology programs and to keep pace with the 
rapid introduction of new value-added products, whether 
developed through biotechnology or conventional breeding.
    This concludes my statement, and I look forward to working 
together as we proceed in the 2003 budget appropriations 
process. We believe the proposed funding amounts and sources of 
funding are vital to providing the infrastructure to protect 
American agriculture from pests and disease and for moving more 
product, especially for increasing exports to foreign markets. 
It will provide the level of services expected for our 
customers, the farmers, the ranchers and the agriculture 
marketing industry and consumers.
    We are happy to answer any questions that you may have. 
Thank you.
    [The statement of Mr. Hawks follows:]

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    Mr. Bonilla. Thank you, Mr. Hawks. We do appreciate the 
photo you sent us of the beagle. It adds a lot to the room, and 
we appreciate that.
    Mr. Yates, did you have some opening comments?

            Agricultural Marketing Service Opening Statement

    Mr. Yates. Yes. Thank you.
    It is a pleasure to be here, and I certainly agree with 
Congresswoman Kaptur in the opening statement that she made 
about the importance of the Agriculture Marketing Service to 
agriculture.
    I am a farmer from California and I had the opportunity of 
working in the California Department of Agriculture for 9 
years. I know that the programs that AMS provides to 
agriculture are critically important in helping them move their 
products into not only the national marketplace, but also the 
international marketplace.
    We do that in a variety of ways, and naturally price 
reporting, whether it be on livestock or in a market, on fruits 
and vegetables and other commodities, is of critical importance 
in the ability of farmers to move their product on a timely 
basis.
    In those, we have our research and promotion programs which 
are very important for the producers to be able to promote 
their product to consumers, both in the United States and 
internationally, as well as marketing orders which help our 
growers develop standards where the consumer knows what they 
are buying when they buy it from long distances.
    We also provide a service of Section 32 in helping farmers 
with surplus commodities, at the same time providing very 
nutritious food for our schoolchildren, as well as needy people 
throughout the United States.
    Farmers markets and direct marketing are critically 
important to our small farmers, who represent 90 percent of the 
farmers in the United States. We work closely with them. I had 
experience for 9 years working with farmers markets in 
California, and I know what they do for agriculture.
    We also provide a service of pesticide detection programs, 
which helps not only protect the food supply, but it also gives 
us the ability to register the tools that we need to produce a 
nutritious and healthy product.
    I appreciate the opportunity of being here today, and I 
would be more than willing to answer any questions you might 
have.
    [The statement of Mr. Yates follows:]

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    Mr. Bonilla. Thank you, Mr. Yates.
    Ms. Waterfield.

                        GIPSA Opening Statement

    Ms. Waterfield. Thank you, Mr. Chairman. Briefly, I just 
appreciate the opportunity to be here, and I want to thank the 
subcommittee for the support it has shown GIPSA in the past. I 
will defer to the comments that my colleague, Mr. Shipman, has 
already submitted to this committee; and I will be happy to 
answer any questions put forward by the committee. Thank you.
    Mr. Bonilla. Thank you.
    [The statement of Mr. Shipman follows:]

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    Mr. Bonilla. Mr. Acord.
    Mr. Acord. I have submitted a statement for the record, Mr. 
Chairman. I have no further comments other than I appreciate 
the opportunity to work with the committee on the 2003 
appropriation.
    [The statement of Mr. Acord follows:]

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                Proposed Language Change, CCC Authority

    Mr. Bonilla. Mr. Hawks, I would like to begin with an issue 
here that is apparently a policy change in the budget request. 
That is a proposal to delete the Secretary's emergency 
authority to use the Commodity Credit Corporation, which, as we 
all know, is CCC, to finance emergency pest and disease 
outbreaks. This authority has been in place since 1984, and it 
was this subcommittee that provided this authority. The 
proposed language would give the Secretary the authority to use 
CCC only for an emergency that was not funded out of the CCC in 
the previous fiscal year. I want to learn how this authority 
would work, so I ask you to indulge me for just a second.
    If I understand the proposal correctly, funds to combat the 
Asian long-horned beetle, which was funded out of CCC in fiscal 
2002, would not be eligible for CCC funding under the proposed 
language in fiscal year 2003. Is that correct?
    Mr. Hawks. Yes, sir, that is correct. The proposal that we 
presented suggests that after the emergencies are declared, 
they should be shifted to appropriated funds.
    Mr. Bonilla. Would the language allow you to seek funding 
to combat the longhorn beetle in fiscal year 2004?
    Mr. Hawks. I am going to defer to Mr. Dewhurst on that one.
    Mr. Dewhurst. There is money in the budget to deal with the 
current outbreaks that we know about. If there were new 
outbreaks in different locations or under different 
circumstances, I believe we would use the emergency authority 
to deal with those new outbreaks. I think that is the way the 
budget is set up.
    Mr. Bonilla. So if there was a major outbreak of longhorn 
beetle in fiscal year 2003, for example, and the cost exceeded 
the funding levels, this will be appropriated under this 
proposal. Are you suggesting then that you would have to go to 
that emergency designation?
    Mr. Dewhurst. If we had a new outbreak in a different 
place, I believe we would use the emergency authority.
    What we have in the budget is money for the known 
outbreaks--Chicago and New York, as I recall. We would use the 
appropriated money for those concerns.
    Mr. Bonilla. I just want to state for the record that this 
proposal would be a significant change in the way we have 
responded to pest and disease outbreaks in the past. History 
shows that the current method of response has worked pretty 
well so far. USDA is committed to eradicating several pest and 
disease outbreaks that were declared emergencies by the 
Secretary, and we will work with you to ensure that you have 
the resources available to you to complete the job.
    This budget proposal is something we definitely want to 
bring to everyone's attention at this point.
    Mr. Hawks. Mr. Chairman, I would like to add to that, and 
say thank you for your commitment to help us address those 
needs that we do have. I certainly appreciate that.
    Mr. Bonilla. At this time I am going to yield to Ms. 
Kaptur.
    I want to advise folks that we are expected to have a 
Journal vote shortly after 10 o'clock. We might have to take a 
quick break at that time. I would hope that one of my 
colleagues can get back here and take the Chair for a moment so 
we can have as much continuity as possible during this 
interruption.
    Ms. Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman, very much. Thank you 
all for your testimony.
    Under Secretary Hawks, you struck a real chord with me in 
the beginning of your testimony where you talk about selling 
agriculture as a profession. With the new eye that you have on 
Washington, I would like to invite you to go look at the 
agriculture exhibit at the American History Museum and see if 
you were a young person 17 years old, if you would ever 
consider agriculture as a profession if you looked at it.
    I think that as we are redoing some of the buildings here 
in Washington for agriculture, we need to sell agriculture to 
the millions of visitors that come here.
    You talk about biotech, and we know the plant genetic work 
that is being done and all of the work. Here is a brochure on 
ethanol. Now, what is going on around this country to move us 
into a new emerging future based on agriculture? We have to 
make this field exciting to the youth of this country, and 
those exhibits are great historically, but they do not give a 
sense of the contemporary nature of agriculture.
    If you go into the computer exhibits, the kids are all over 
there, and I think our private companies could be challenged. 
If you look at what goes on at Epcot Center down in Florida in 
promoting agriculture through the displays that are there, I 
would just suggest that as you are wandering around town you 
familiarize yourself with the turf here.
    You have an ally up here on selling agriculture as a 
profession in its full dimension.
    Mr. Hawks. Ms. Kaptur, I would like to say to you that this 
is my first cut on this--and we did this collectively, setting 
these goals. I even suggested that we set that goal of selling 
farming. Having spent the last 30-odd years--or actually my 
entire life in production agriculture and never serving in 
Federal Government until last May, I have a keen interest in 
selling agriculture as a profession.
    I think it is a great profession, I think it is a noble 
profession, just like a lot of other professions that we have; 
and I would be delighted to work with you to make sure that we 
are displaying and exhibiting it in the appropriate manner that 
actually reflects agriculture today. I think if a lot of 
younger people who are in college or in high school really 
understood what agriculture is all about and how it affects the 
lives and livelihood of every person in the world, that we 
would have a lot more interest in agriculture; and that is 
exactly what we intend to try to do. So I am looking forward to 
working with you in whatever capacity we can.
    Ms. Kaptur. Well, I hope that you go sit down with the head 
of the Smithsonian and tour those buildings. I hope that as we 
invest the money in the South Building at agriculture, you 
think about the way that it speaks to the public.
    You know, we had to fight prior to your service to get the 
farmers market over there on the Mall; and all of a sudden 
everybody goes, oh, gee, it is successful, oh, surprise, 
surprise. Yes, well, those were small steps, but so much more 
can be done because this whole city is a museum and people 
learn by coming here.
    And so thank you for your receptivity. I think Secretary 
Veneman probably shares this perspective.
    I wanted to say to Mr. Yates that as I listened you 
referenced farmers markets in your testimony. But if I look at 
the budget, there are no program increases for two activities 
important to farmers markets in your budget, the Wholesale 
Farmers and Alternative Market Development Program and the 
Payments to States and Possessions Program. I merely point that 
out to you as we fine-tune the submission through this 
appropriations process.
    It is just amazing some of the work that has been done with 
farmers markets, and I have always thought the greatest job in 
the world would be to be in charge of networking all the 
farmers markets of this country so that the soup produced in 
North Carolina could end up on the shelves of our local farmers 
market in Toledo and to provide a real alternate marketing 
opportunity for a lot of the newer products coming out where 
the income goes right to the producer.
    And I notice, Mr. Hawks, that you are largely a row-crop 
farmer, although you have many other things in your background. 
But I have to put in a word for the specialty crop producers 
here.
    I represent both, and I can tell you that some of these 
farmers market programs adjacent to cities are among the most 
important ways we can actually get them access to the customer. 
And so I hope that you might take another look at those 
programs. If you wish to make any comments on your perspective 
on farmers markets, I would appreciate it.
    Mr. Hawks. Ms. Kaptur, I certainly appreciate the 
importance of farmers market; and to share with you, I actually 
was in specialty crops. I was in vegetable production. I paid 
my way through college by growing peas, butter beans and snap 
beans every summer on our farm and selling them at the farmers 
market in Memphis, Tennessee. So I have a keen interest and an 
understanding of farmers markets.
    After coming back from college while I was starting my row-
crop operation, I did the same thing. So I have a keen interest 
in farmers markets and a great understanding and appreciation 
for them, as well.
    Ms. Kaptur. And I can tell you from our part of the 
country, our cattle producers, our pork producers, are really 
frozen off the shelves of the major supermarkets, and were it 
not for opportunities to sell through our farmers markets, they 
couldn't reach the public unless they did it out of their own 
operation--which is generally in the country, so you don't have 
as many customers driving by.
    I know my time has expired, but I look forward to the next 
round of questions.
    Mr. Bonilla. Thank you, Ms. Kaptur.
    We will go to Mr. LaHood and then Mr. Boyd. Mr. LaHood.

                           Homeland Security

    Mr. LaHood. Let me ask, since it is the favored topic of 
everyone around here if--have you folks been involved in 
discussions with Governor Ridge and his staff in his office, if 
there was some sort of national calamity that took place in our 
country with respect to food, food supply, origins of food 
coming in, are you a part of a team of people that has been 
working on a plan to make sure that the food supply in our 
country is safe and that you would be working with Governor 
Ridge?
    What have been your activities with his office in securing 
the food supply of our country if something were to happen?
    Mr. Hawks. Yes, sir, Congressman, we have. Actually, we 
have, within USDA, a homeland security structure. The Deputy 
Secretary is the direct interface with Homeland Security, with 
Governor Ridge's office. Dr. Elsa Murano, the Under Secretary 
for Food Safety, and I cochair Agriculture's Production and 
Protection of the Food Supply Council within USDA.
    We have numerous working groups working with Governor Ridge 
in the Office of Homeland Security. I have primarily been 
working on the border issue; Mr. Acord and myself have both 
been working very closely with that. Other members of the USDA 
team have been working on other specific issues.
    So I could, go to great length in talking about border 
issues and what we are doing there if you would care to do 
that. We do recognize there is a tremendous need for greater 
coordination and cooperation between our border agencies to 
make certain that we do keep out of this country the things 
that we want to keep out of it.
    I will share with you that agriculture plays a very vital 
role in that process, and I do not take lightly the 
responsibility of excluding harmful plant and animal pests and 
disease out of this country.
    So we are working. We are engaged in that and will be 
continue to be engaged.
    Mr. LaHood. Is there a plan in place and can you assure us 
today that there is a plan in place to make sure that the 
homeland food supply is safe and secure in the event that 
somebody tries to--we know there are people that want to do in 
the United States. We know that the war is being fought not 
only in our own country, but in other places of the world. But 
with respect to the food supply, can you tell us today that 
there is a plan in place and that we are prepared to deal with 
any kind of an assault on our food supply?
    Mr. Hawks. I can tell you that we do have plans. They are 
in place. It is our intent to protect the food supply. There is 
no question about it.
    I would like to share with you, on 9-11, that very day 
before we left our offices, the then-Chief Veterinary Officer 
of the United States sent out an e-mail that was circulated, 
and the e-mail said for everyone to heighten their vigilance, 
because of what happened. And along with that e-mail, he 
suggested to share it wherever the recipient chose to.
    Would you believe that that same afternoon that e-mail had 
circulated back to me through a veterinarian out in the 
countryside? So we had plans in place before 9-11. We are 
obviously continuing to evaluate our plans in light of the new 
environment that we are living in today.
    Mr. LaHood. Has your agency or have your folks had a chance 
to look at the amendment that was offered in the Senate by 
Senator Tim Johnson having to do with the sale of livestock 14 
days before? And do you have any comments on that in terms of 
your ability implement it if that were to become law, in terms 
of really being able to administer that new law; or do you have 
any thoughts about that amendment and do you support it? What 
is your feeling about all of that?
    Mr. Hawks. The administration has not taken a position on 
that particular amendment, and I was in a meeting the other day 
with some of the administration people that are working 
directly on it, and the fact was pointed out that we feel like 
Congress should work its will on some of these.
    But I will defer to JoAnn Waterfield, who is involved in 
the Packers and Stockyards Administration, to talk about the 
mechanics of administering that.
    Mr. LaHood. Let me just say one thing. This is an important 
amendment. And you know as well as I do--that I have a very 
high regard for Secretary Veneman. I like her very much and she 
is a friend.
    But, you know, one of the criticisms of the USDA has been 
that they haven't weighed in either in the House or Senate, as 
these bills have been marked up--now we are talking about farm 
policy for the next several years, and I would be curious to 
know at some point how--you folks are going to have to 
administer this if this becomes law. This is an important 
change, and I have been hearing from a lot of my people about 
it, one way or another; and at some point I hope you folks 
weigh in on this because you are going to have to administer 
it.
    Mr. Hawks. I will defer to JoAnn to answer about 
administering it.

                           Johnson Amendment

    Ms. Waterfield. Yes, obviously we are following the debates 
on the amendment very closely, and we are paying attention to 
the language of the bill and also to the debates behind the 
bill, so that if the amendment is passed and becomes part of 
the farm bill, we understand as much as we can about what 
Congress intends to pass.
    We will promulgate regulations setting forth how we will 
interpret the bill if and when the Johnson amendment is 
incorporated into the statute, so that the industries that we 
regulate clearly understand what the statute's requirements 
are. At the time that we promulgate regulations, the industry, 
of course, will have the opportunity to comment on our 
interpretation.
    Once the regulations are promulgated, though, they will 
have the force and effect of law. And we, of course, will 
enforce the law. But at the time that the regulations go into 
effect, there will be no surprises, so that the industry will 
understand exactly what control means from USDA's perspective.
    Mr. Bonilla. Thank you, Mr. LaHood.
    Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman.
    I want to start by saying, Secretary Hawks, that I have 
read your biography, and I very closely identify with many 
things that you have done in your life, not only in the 
specific tasks that you performed, but of the time in our 
country that you performed them; and I am very happy that you 
were there.
    I want to start by following up with Mr. LaHood's comments 
and say that I share the same concerns that he does about the 
Johnson amendment. I have been talking to my farmers back home; 
and actually they are very mixed about whether they support it 
or don't support it. They are not sure, because they don't even 
understand it.
    I think one of the things that concerns me about a 
statement that I just heard from Ms. Waterfield is that you 
said ``we will interpret what it means after it goes into 
law.'' We need more than that. We need to understand what it 
means before it goes into law, so that we can know how to fix 
it or whether we ought to do it or not do it. I think maybe 
that was where Mr. LaHood was going.
    Our people are very confused about it. I think many of the 
Members of Congress are very confused about what it does. Does 
it inhibit our ability to do the things--contracting, hedging--
that we have been doing up to this point or not?
    So I would encourage the administration to weigh in as 
well. No question there. I just wanted to make a follow-up on 
what Mr. LaHood said.
    I would like to ask Mr. Acord a question.

                             Citrus Canker

    We have a high level of interest in a little pest that came 
in through the Miami Airport in the early 1990s, brought in 
through the APHIS inspection system people. Some tourists 
brought it in, or some resident--citrus canker.
    Would you, Mr. Acord, update this committee from your 
perspective, on how we are managing in that fight against 
canker? Are we making progress? Are we losing? What is it 
costing us? How much more is it going to cost us?
    If you would, I would appreciate that.
    Mr. Acord. I would be happy to do that, Mr. Boyd.
    The progress we have made in trying to eradicate citrus 
canker obviously has been slowed by the lawsuits that we have 
had in Miami-Dade and Broward Counties. This stopped the 
removal of trees from--within the 1,900-foot barrier that the 
scientists have told us is necessary to prevent the spread of 
citrus canker.
    Notwithstanding that, we still have the ability to remove 
infected trees, and this State, through our cooperative 
program, is doing that. The legislature in Florida, according 
to the Commissioner of Agriculture, is near passing a bill 
which would mandate the 1,900-foot barrier, and we would remove 
trees within that 1,900-foot barrier under State law.
    If that law passes, and there are no further court 
challenges, that removes the major barrier to progressing with 
the eradication program. As long as we continue to have those 
trees infected or exposed in the Miami-Dade-Broward County 
areas, we are going to continue to have a source of infection 
that will continue to move up--or potentially move up to the 
major citrus producing area in Florida.
    So our hope is that, through the settlement of the lawsuits 
or the passage of a State law, that we will get on with that 
tree removal.
    One other concern we have, is continuing the ability to 
achieve the kind of cooperation that we have with the State; 
and we have had a good, cooperative relationship with the 
State.
    Mr. Boyd. I want to make sure that the committee 
understands what the 1,900-foot issue is. Also, I agree with 
you, I think the legislature is close to codifying that, and 
that will help us.
    Mr. Acord. Yes, sir.
    Mr. Boyd. However, I hear you saying that you think if we 
get the rule codified that you are optimistic about our battle 
against canker, and you think it is within our reach in the 
near term to wipe it out?
    Mr. Acord. I do, near term, it may be an overstatement.
    Mr. Boyd. A year?
    Mr. Acord. Within a year we should have the trees removed. 
We should have the source of inoculum removed, and with good 
sanitary practices among the growers. I really think it is 
achievable at that point.
    Mr. Boyd. Okay.
    Mr. Chairman, I noticed the red light, but could I continue 
on this issue?
    Mr. Bonilla. Go right ahead.
    Mr. Boyd. Mr. Acord, it is my understanding that there has 
been no problem in the commercial grower industry in terms of 
the 1,900-foot rule.
    Mr. Acord. That's correct.
    Mr. Boyd. By the way, 1,900 feet, for the members of the 
committee that don't know, states when you find one infected 
tree, you have to draw a circle 1,900 feet around it and 
destroy the trees within the circle. That is the only way to 
get rid of it. I understand, 260 acres of producing citrus 
groves have been destroyed, and our growers have been most 
cooperative in their efforts to assist the State and the 
Federal Government in eradicating this.
    Can you talk to me about why you think they have been 
cooperative, and what do you think the cost will be to continue 
the eradication program? Also, talk to me about the 
compensation issue.
    Mr. Acord. One of the major reasons the industry has 
cooperated has been the compensation that they have received 
for their trees. After all, this is a commercial enterprise. 
They do have to continue in business, and the only way they can 
do that is with compensation for the lost trees and the lost 
income that results from losing those trees. Because the 
important thing to recognize here is, this is the first--or one 
of the first--diseases that we have ever had to battle where 
you remove the host crop.
    There is no spray for it. There is no other treatment. You 
have to remove the trees. So that is taking away the livelihood 
of the producers.
    They have been very cooperative because of the compensation 
that they have received. Besides that, collectively the 
industry recognizes that failure to remove those trees 
represents a threat to the entire industry. It has the 
potential to devastate the entire State.
    On the other hand, the homeowners, over time--those that 
have so adamantly opposed the removal of the trees, are going 
to lose those trees anyway. If we only remove the ones that are 
infected, then it is simply going to spread to the others, and 
over time they are going to wind up losing those trees. But it 
is hard to convince people when you are taking a 10-year-old 
tree out of their yard that we are doing the right thing.
    Mr. Boyd. Mr. Acord, assuming that we get the 1,900-foot 
rule codified quickly or we win the lawsuit, what do you think 
the cost under the current compensation formula will be on the 
commercial grower side?
    Mr. Acord. My hope is that we would not have to get into 
any more commercial compensation. We don't know at this point 
and don't have an estimate on what that might be over the next 
year or so. If we are able to get in and remove the trees, we 
think that any further infection of a commercial grower is 
going to be minimal. It is simply a guessing game at this 
point.
    Mr. Boyd. Mr. Acord, you are very, very optimistic about 
that, and as you know, that fund balance is zero now.
    Mr. Acord. That is correct.
    Mr. Boyd. There are no unpaid commitments, but the citrus 
industry folks are very concerned about the future. I would 
encourage you to meet with them and talk a little bit about 
this. However, I just don't see how we get through this without 
some more help, and I just want to make sure that we get you on 
board with that.
    Mr. Acord. Well, I didn't mean to imply that it is zero. 
There is--obviously some. It is just very, very difficult at 
this point to estimate what that might be.
    I am well aware of the industry's concern about that, sir, 
and they never miss an opportunity to make me aware of it.
    Mr. Boyd. Thank you very much.
    And, Mr. Chairman, that is all I have. But before I quit, I 
want to associate myself with the comments that you made about 
the $162 million account. I didn't get into that, but I could 
ask many questions about that, how it would work mechanically 
in terms of new canker finds. Would that be a new emergency? Or 
will that be the old emergency? And which account will it be 
paid out of?
    Also, 162 million to pay for all the invasive pest 
emergencies of this country for 1 year may not be enough. When 
you look at what has been done historically, what we have had 
to pay out of CCC in the last couple of years is about double 
that. So I would like to associate myself with the opening 
remarks of the chairman about that way of doing business.
    Mr. Bonilla. Thank you, Mr. Boyd. And also with the point 
you brought up, I think I would like to emphasize the need for 
us to continue to have that emergency authority to deal with 
some of these things when they break out. That is what we are 
talking about here today.
    I have a couple of questions remaining, as well, but I 
would like to go ahead and yield to my friend, Mr. LaHood.

                            MAD COW DISEASE

    Mr. LaHood. Let me just ask one other question, Mr. 
Chairman.
    One year ago, your agency, particularly the Secretary, the 
number one topic was mad cow disease. Is that still a problem 
in the world, and is it a problem for our country? We haven't 
heard much about it. I haven't read much about it, and I am not 
certain if that is because we have eradicated it, the world 
community has, or if other things have grabbed the headlines.
    Mr. Hawks. Actually, the Department had entered into a 
contract with Harvard to do a risk assessment on BSE, or mad 
cow disease, and we issued that report about a month to 6 weeks 
ago. The finding by the scientific community in a very, very 
detailed research project was that the risk of mad cow disease 
in this country was very minimal, and that even in the event 
that it was here and had been here, it would be stopped.
    And there has recently been a GAO report that I am sure you 
are familiar with, that actually didn't look at it in depth 
like the scientific study did and had, maybe, some other 
conclusions that one could draw.
    But it is our belief in the Department of Agriculture that 
the risk assessment that Harvard did--and they are well known 
for their ability to assess risk--says that there is a very 
minimal risk for mad cow disease in this country.
    Mr. LaHood. What is happening in other countries?
    Mr. Hawks. There are other countries that did not implement 
the same things that we did with feed bans, with various 
processes to mitigate for mad cow disease that are actually 
showing up. As you are familiar, I am sure, Japan recently had 
mad cow disease there. It is showing up in other countries as 
well.
    But as I said, we feel that this country has a very minimal 
risk. We have actually strengthened and increased surveillance. 
As you are aware, the only way right now that we have to test 
for this is to test the brains of a dead animal.
    We are increasing that surveillance. We are increasing the 
surveillance on farms. We are actually doubling our 
surveillance. I think we have done at least 500 now off of 
farms, and that is the highest risk that we have there.
    There are a lot of issues involved in this, and when you 
start looking at it and start trying to mitigate all of these 
issues, you come up with other issues. So we have to be very 
careful on how we approach this, but we think the surveillance 
that we are doing for the most likely places is a good way to 
determine whether we do or don't have it.
    But as I said, it is a very minimal risk, at best.
    Mr. LaHood. Congratulations. This was obviously a hot topic 
a year or so ago, and obviously somebody has been doing a lot 
of good work at the Department.
    Let me just go back to the issue that I raised before, Ms. 
Waterfield. And, Mr. Secretary, I will just make this point. 
You can respond to it if you want.
    I think there are two issues here with this amendment. One 
is the policy; the other is the money. I mean, our committee 
has the responsibility for appropriating money, and I guess 
what I am wondering is--what do you need to look at is, if this 
becomes law, what does it mean in terms of your agency, in 
terms of inspection and the relationship that you have with the 
packers and with the livestock people?
    I mean, this is a significant change in the way this kind 
of operation is carried out, the selling of livestock and the 
packers and so forth, and that is the issue that I want to 
raise--not only the policy part of it but the money part of it.
    It looks to me like, in your budget, there hasn't been a 
dramatic increase in inspections at places where livestock are 
slaughtered, and so I really think you need to look at this 
from both points of view. The policy point of view which--as 
Mr. Boyd said, in my area it is the same.
    There is a conflict, you know. People are trying to figure 
out if it really does make good sense in terms of policy, but 
in terms of your point of view, I think it is going to add 
additional cost. But--you know, you are smarter than I am about 
that, but I think you need to look at that.
    Thank you, Mr. Chairman.

                           WILDLIFE SERVICES

    Mr. Bonilla. Thank you, Mr. LaHood.
    Mr. Acord, I want to talk about Wildlife Services for a 
second. That has always been an issue that is not only 
important to the country, but important to my area. I believe 
it was Mr. Butler that came in the other day and emphasized the 
point that this is not just a problem for rural areas. A lot of 
urban areas out there have problems with animals--for example 
birds getting in the way of planes at JFK Airport. Did you 
bring the picture of the coyote on the subway?
    Mr. Hawks. I brought the picture.
    Mr. Bonilla. That coyote on the subway, that famous picture 
will be used down the road, Mr. Hawks, when I am sure there 
will be another effort to try to cut this line item as we move 
this bill forward. Some people don't understand that this is 
not just a rural problem.
    That coyote on the subway is a clear example of the 
problem. We will probably get it blown up, and no matter what 
subway they might think it is, we are going to tell them it was 
on their subway.
    Mr. LaHood. Do you think that picture will be on the wall 
in this room, Mr. Chairman?
    Mr. Bonilla. Well, I would like to honestly explore the 
possibility. If you can get that picture blown up, I would like 
to have that picture on this wall. Let us do that if it is 
possible.
    Mr. Hawks. Mr. Chairman, I encourage you to do that, and we 
will take charge of getting it blown up for you.
    Mr. Bonilla. I have a question on Wildlife Services and 
cooperators in different States paying their fair share of 
program costs. In our State of Texas, for example, we are 
funding nearly 50 percent more than the Federal Government's 
share of Wildlife Services, and we are glad to do that. We know 
it is important.
    Understanding that the budget request is going to try to 
count on more of this in the future, my question is, how much 
of a reduction is there in the Wildlife Services request that 
reflects the move for cooperators to pick up a larger share of 
the program? Are the funds available in the budget request to 
match the Federal Government's share up to the level of the 
cooperator's share, Mr. Acord?
    Mr. Acord. No, sir. They are not in terms of the last part 
of your question.
    The budget request does, as you have suggested, contemplate 
the cooperators providing additional funds. There is about $9 
million--in terms of the reduction, that the cooperators would 
be expected to pick up.
    The cooperative share that is paid by the States around the 
country is very, very uneven. Texas happens to be one of those 
great States that, has a very, very high cooperative share on 
the State side. There are others that don't have quite that 
high level, but we simply don't have the funds to equalize the 
cooperative cost share all across the country.
    Mr. Bonilla. Well, that is something that we are going to 
have to work on--not just in my area, but we are going to have 
to work on that nationwide to make sure that these folks do 
have the resources they need to handle this problem.
    Mr. Acord. Well, it is a program that while it does have 
some controversy associated with it, I don't think there is a 
group of men and women that work any harder in the government 
anywhere or that are more ingenious or more creative when it 
comes to finding solutions to difficult problems. And we have 
always appreciated your support for the Wildlife Services 
program.
    Mr. Bonilla. I am honestly baffled year in and year out 
when some people do try to add controversy to this issue, 
because these are some of the most thoughtful, humane people 
behind these programs. They are carrying out the program for 
the right reasons and not for some of the reasons that people 
are just dreaming up in their heads to try to create 
controversy.
    Mr. Boyd.

                            INVASIVE SPECIES

    Mr. Boyd. Thank you, Mr. Chairman. I want to say to you all 
that I believe there is an increase in requests for salaries 
and expenses on the APHIS side which recognizes the whole 
problem we have with invasive pests. I know we got some money 
in the antiterrorism supplemental, and so I just want to tell 
you all that this member, and I am sure other members of the 
subcommittee also, want to be supportive and helpful.
    We know that we starve you and expect you to get the job 
done at places like Miami and the other places around the 
country where we have this problem. I just wanted to compliment 
you for doing the best you could on the budget side and want to 
offer our support; and I really don't have a question.
    Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you. Mr. Boyd, did you have anything 
further? Mr. LaHood?
    Mr. LaHood. No, I don't.
    Mr. Bonilla. My understanding is Ms. Kaptur is going to 
return with additional questions. She will be returning 
shortly, as well as Mrs. Emerson from Missouri who is trying to 
juggle a couple of things on the floor. We do expect a vote 
within about 6 or 7 minutes. If you all would be patient with 
us, we would appreciate that. Mr. Boyd?
    Mr. Boyd. Mr. Chairman, do you want to fill time?
    Mr. Bonilla. If you have questions, we would be delighted 
to hear them.

                           AERIAL OPERATIONS

    Mr. Boyd. Something has come to my attention that--we have 
got these experts here, we can always find out good additional 
information.
    But APHIS is involved in the safety of aerial operations, 
with the birds around the airports; does that make sense? Can 
you talk to me a little bit about that and what kind of problem 
that is. And I understand that several States ranked pretty 
high in bird strikes. And how many people do we have, and what 
kind of people do we need or resources do we need? How do we 
fight this problem?
    Mr. Acord. There have always been problems with birds and 
airplanes in the same airspace. This is a growing problem, 
around the country. We started out probably with one of our 
first big programs at Kennedy Airport with gulls getting into 
the airspace in one particular runway. We have continued to 
work with the Air Line Pilots Association, with States, with 
State wildlife agencies, to find solutions to these problems, 
because oftentimes airports seem to be located near water. They 
seem to be located near landfills, or landfills are located 
near the airports because of the way the land use patterns are, 
and it creates an inherent problem.
    One of the things we have tried to do is work with the 
airline industry to develop methods of control in and around 
airports, to do research on how the environment impacts the 
birds--what kind of birds does it attract, the height of the 
grass in and around the airport and other environmental factors 
that might influence the birds' presence in and around 
airports.
    Miami happens to be an airport that has a particular 
problem.
    We are continuing to try to work with the airport authority 
in most of the situations where they request it in order to 
enter into a monitoring program and an assistance program where 
the birds can be scared or there can be other environmental 
modifications around an airport that would prevent the birds 
from wanting to congregate there.
    Most of this work is funded by the airport authority; it is 
done cooperatively with them. The issue becomes the research 
and who funds the research, and we have received money from 
FAA.
    We work cooperatively with FAA as well. We maintain the 
database for FAA on bird strikes.
    But it is not just birds. It is other wildlife. In some 
cases, deer get into jet engines, and it doesn't take much 
imagination to figure out what happens there. So we work on all 
wildlife, not just birds.
    Mr. Boyd. It sounds like cubed venison to me.
    Okay. Is there anything we need to do? I mean, the only 
thing I can offer is that we have a lot of hunters at home. If 
you provide the planes----
    Mr. Acord. In today's environment, anyone around an airport 
with a gun is going to have great difficulty. So that is why 
they are looking for someone with a security clearance to get 
on an airport to perform this work.
    Mr. Boyd. Thank you, Mr. Acord.
    Mr. Bonilla. Thank you, Mr. Boyd.

                          FEDERAL SEED PROGRAM

    Mr. Hawks, the AMS Federal Seed Act program regulates 
agricultural and vegetable seed moving in interstate commerce. 
It prohibits false labeling in advertising of seed to ensure 
farmers and consumers can purchase the correct variety of seed. 
Seed shipments are sampled by State departments of agriculture 
and apparent violations of the act are sent to AMS for 
regulatory action. The Seed Act budget is $1.3 million in 2002.
    My question is directed to Mr. Yates. You are requesting 
$1.1 million in increases for your Federal Seed Act program. If 
approved, this increase would almost double the size of the 
program.
    Tell us why you are requesting such a significant change 
and what the benefits of that increase will be to agriculture 
in this country.
    Mr. Yates. Thank you, Mr. Chairman. This is critically 
important.
    Our seed program for the last 20 years has not had any 
additional appropriations. In fact, the appropriations have 
decreased over the last 20 years. And so we have not filled 
positions of people that have retired, and the equipment that 
we are operating with today is 20 years old--not only our seed 
testing equipment, but also our computer equipment that we use 
to track all of the violations and all of the certifications of 
seed. This is really important for agriculture, because we 
market 30 percent of the seed that we produce in the United 
States in the international marketplace.
    Another piece of this is that we have to have our seed lab 
accredited. Accreditation is critically important to where we 
are recognized in the international marketplace and where we 
have the ability to move our seed, as well as being able to 
work with our State partners and make sure that they are 
considered accredited also. That is the main reason that we 
have asked for this increase.
    Mr. Bonilla. Folks, the bells have just gone off for a 
vote. We will take a 5-minute break and resume the hearing when 
we are able to return. Mrs. Emerson will likely be the first 
one to resume questioning.
    We will take a very brief break, and we will be back with 
you.
    Mr. Boyd, did you have--I am sorry. Did you have----
    Mr. Boyd. Can I?
    Mr. Bonilla. Absolutely.

                              BOLL WEEVIL

    Mr. Boyd. Thank you. One of the programs that the chairman 
and this member both are interested in is the boll weevil 
eradication program, and I notice a significant decrease in the 
budget request.
    Do we have good news there, that the reduction is because 
we don't have anymore boll weevils to eradicate, or the bad 
news is that we just are refusing to do it?
    Mr. Hawks. Mr. Boyd, obviously being from Mississippi, the 
Boll Weevil Eradication Program is very important to me as 
well. The program has been very successful. We are moving into 
different phases of the program now. Actually, the cooperators 
are picking up more of the expense of that program, but as we 
move forward into the later phases of the program, there are 
actually less demands on that program.
    Mr. Boyd. Thank you very much. It has been a very 
successful program. Thank you.
    Mr. Bonilla. Thank you for bringing that up, Mr. Boyd. You 
are right, that is a very, very big deal for my State as well. 
At this time, we will take a few minutes break and we will 
return.
    [Recess.]

                               DEBARKING

    Mrs. Emerson [presiding]. I will reconvene the hearing. 
Thanks for being here. Sorry I missed the beginning of your 
testimony. I have an interesting question, and one that I am 
most concerned about. It has to do with hardwood debarking. It 
is my understanding that APHIS is going to be supporting the 
position of the wood products industry that would have the 
debarking requirement deleted from proposed International Plant 
Protection Commission wood packing regulations. Given the fact 
that I have 1.1 million acres of Mark Twain National Forest, 
and this is critical to my district and the thousands of 
individuals who are employed in the wood packing and related 
industries, plus my little bitty sawmill owners, I would like 
to hear about your support for this. Hopefully you support 
this.
    Mr. Hawks. Yes, ma'am. Ms. Emerson, we did meet last week 
with your constituents, I think last week or week before last, 
to have a discussion about that, and the fact is there are some 
proposals before the IPPC now. Actually Rich Dunkle, who is 
sitting right behind me, is our representative to that 
committee, and certainly he is working with his counterparts in 
both Mexico and Canada to try to have a unified voice toward 
that, and I can share with you people think that this guy must 
have done everything in the world.
    But I am a former owner of one of those little sawmills as 
well, and not only an owner of the sawmill, I worked at that 
sawmill. So I certainly understand and appreciate your concerns 
there.
    Mrs. Emerson. I hope it all works out, because the people 
who are really impacted in my district are those whose yearly 
incomes may be 7, 8, 9, $10,000 maximum. To see their success 
pulled out from under them would be devastating. So I 
appreciate that.

                        CHRONIC WASTING DISEASE

    Let me ask you another question that we are concerned about 
within the Missouri Department of Agriculture. It has to do 
with the potential for an outbreak of chronic wasting disease 
in captive elk herds, and I am told CWD is readily 
transmittable to deer. I would like to know what you all are 
doing to try to stop the spread of chronic wasting disease.
    Mr. Hawks. I will answer that, and then I will turn to the 
real expert as well. We are in the process right now. We got 
emergency funding for the depopulation of those elk herds that 
have been diagnosed with chronic wasting disease that has been 
going on for probably about a month now. I personally got 
involved, as well as the Deputy Secretary in that process, 
because it concerns me as well.
    And I think as you said that there is a possibility of it 
transmitting to white-tailed deer. So that is obviously 
something that I am very interested in and very concerned 
about, and I will ask Mr. Acord to give you more detail.
    Mrs. Emerson. Thank you Mr. Hawks.
    Mr. Acord. Ms. Emerson, as Mr. Hawks indicated, we have an 
emergency program underway to depopulate those farm-raised elk 
that have been found to have chronic wasting disease in those 
herds, and we have also taken out the remainder of the herd 
because of their having been exposed. The major focus of that 
program has been in Colorado, but as we begin to trace out 
other animals that have interacted with those herds, we expect 
to find others in other parts of the country.
    We are working cooperatively with the State Departments of 
Wildlife to assist with the laboratory diagnosis of the samples 
that have been submitted from hunter harvest sampling. You 
probably are aware that just this week, there were three deer 
confirmed in Wisconsin as having chronic wasting disease.
    It is a concern to us. We certainly want to make sure that 
we continue to focus on the farm-raised elk and deer, and that 
we continue to assist the States with the survey of the disease 
in the wild populations so that we have knowledge of the 
distribution of the disease in the country. The work so far is 
concentrating on those farm-raised animals that are in 
Colorado, a herd in Oklahoma, and another in Nebraska.
    Mrs. Emerson. Do you feel you have the necessary resources 
to do the job?
    Mr. Acord. The difficulty right now is we do not know how 
big the job is. The more surveillance that we do, the more we 
are apt to find; we have the resources for the job that we now 
know about. We have the request in for an increase to deal with 
next year, but the more we learn, the more we may find.
    Mrs. Emerson. I appreciate that. Thank you, Mr. Acord. My 
time is up, and I will yield to my colleague from Ohio.
    Ms. Kaptur. I thank the Chairlady very much, and I wanted 
to just float an idea, Under Secretary Hawks, and see if you 
consider this within your purview at MRP. Though the food and 
nutrition service is not under your jurisdiction this year, we 
are being asked to appropriate over $10\1/2\ billion for 
purchases of commodities that go into our school breakfast and 
lunch programs.
    Under the AMFS, I think you have a request for about $700 
million for supplemental commodities that are brought for 
various reasons for market stability and that are incorporated 
into the school breakfast and lunch programs. But as you think 
about the concept of marketing, let me give you a specific 
situation from my own State, where I think the Department of 
Agriculture needs to help the States meet the farmers who could 
provide the food into the school breakfast and lunch programs. 
What has been happening is, in many places where we have 
farmers producing product, whether it is apples or beef or 
chickens, which could be made into Chicken McNuggets, the 
problem often is that the farmers are not organized in a manner 
to bid on the State contracts.
    So in the State of Ohio, for example, the contract for the 
food programs comes through Department of Education, which 
really doesn't talk to the State Department of Agriculture and 
there is a misfire. I think that that probably happens in many 
places in the country. I had a group of farmers in my office 
yesterday. They were up here with the land grant institutions, 
and many of them were talking about what happens inside those 
cafeterias and how the kids do not eat the proper food. They 
are drinking pop, they are not drinking orange juice.
    I had mothers in my office yesterday talking about how 
children are refusing orange juice in droves in Ohio because 
they do not know what it is. This is in the rural communities. 
This is not to say, that it is not going on in urban areas. 
This is out in the rural areas. What is happening to our 
children's diet? We know one of the big problems we face is 
obesity among our children, improper exercise and improper 
diet, and though you probably do not see this as your role, I 
would encourage you to look at that 10.5 billion dollars and 
see, perhaps, in a demonstration basis, with the nutrition 
service, how we can have farmers working with our local school 
systems providing that food.
    Farmers are the best stewards we have. They understand the 
nutritional content of food and there is a huge divorce going 
on between the ways these State Departments of Education, 
whoever is buying the food and what happens with our local 
agricultural communities.
    So it is not a problem you can solve overnight, but really 
you need to have some discussions at the highest levels and you 
will find what USDA has been doing in this regard is very 
small.
    Mr. Hawks. Thank you, Ms. Kaptur. You are exactly right, 
and we do have projects going on now that address that. I had a 
group in my office within the last few months and we were 
talking about this very situation, and I am going to turn to 
Mr. Yates to talk to you in depth, I think, about that, because 
he is much more familiar with it because it is operated out of 
his mission area, but I agree with you that we need to have 
that connection.

                          LOCAL FOOD PURCHASES

    Mr. Yates. Thank you. It is an important piece which we 
have been working on, and you may be correct that we could do 
more and do a better job because it is critically important to 
small farmers that they have the ability and the opportunity to 
market their product where everybody else markets it. We have 
had a number of programs going on that are working with local 
communities and with school districts and educating them that 
there is product at home. You can buy it here.
    And so we will take your suggestions seriously and look 
into what we can do to improve the fate of the small farmer, 
being able to move their product into the purchases that are 
made and into this pot of money that is there to buy 
agricultural products.
    Ms. Kaptur. In some cases, processing is needed.
    Mr. Yates. That is correct.
    Ms. Kaptur. In other cases, for instance, in Ohio, 
Congressman Hall came to me a few years ago. There was a 
problem because the school systems in Ohio, the Department of 
Education in Ohio, wouldn't buy apples from Ohio apple 
producers because somebody had written some contract that the 
kids would only eat applesauce and not fresh apples or some 
ridiculous thing, and we had to get into that. I thought this 
is unbelievable.
    The whole system fights against working with our local 
farmers and welcoming them into the supply chain and making it 
easy. I do not understand what is going on there, but it is 
pretty serious when you have got $10\1/2\ billion out there. 
That is a significant segment of the market and we need to 
connect our farmers to that.
    I just might mention, and I know this round is up, but that 
in two other programs, the women, infants and children farmer 
markets program and senior farmer market nutrition programs, 
there are no funds provided in the administration's budget. I 
mentioned this to the Secretary, and I do not appreciate that 
because I am a big advocate of those programs. But I can tell 
you they are not only good for the recipients and the buyers, 
but they are superb for farmers because it is direct cash 
income into their operations. There is a fault line in 
agriculture between the really big producers and between the 
smaller and medium-sized producers. For the smaller and medium 
producers, this is the difference between making it into the 
next fiscal year and not.
    I just, again, would draw your attention to those programs 
because they really do directly provide income to farmers who 
cannot find their way to the shelf at the way the grocery 
industry is structured today.
    So, again, those are programs that I am just rising to 
raise consciousness here with every single top level person who 
comes before us. They really do help farmers survive. Their 
operation survive in communities like mine, and we have lost so 
many. We have the last generation of farmers out there. I am 
talking to the kids and I am concerned about what our 
communities are going to look like 40 years from now, and so I 
want to use every tool at the Department of Agriculture to help 
these folks survive and thrive.
    Mr. Yates. I appreciate that. I oversaw the farmers market 
WIC program in California, so I understand what it can do, not 
only for farmers, but also for the people who need help. It is 
a very successful program, and we will certainly take your 
comments to heart and look at this to see if we can find a way 
that we can improve small agriculture out there.
    Ms. Kaptur. Thank you.

                           ANIMAL WELFARE ACT

    Mrs. Emerson. Mr. Hawks, you are new to this job but some 
of the proposals in your budget request are not. Your testimony 
indicates that legislation will be submitted to recover about 
$34 million more in user fees to recover the cost of new 
license fees in the packers and stockyards administration, 
additional license fees for facilities regulated under the 
Animal Welfare Act, and additional grain inspection fees for 
grain standards.
    Obviously, we here in Congress would need time to review 
the proposal, hold hearings, pass legislation in both bodies, 
and then conference before a bill could be signed into law. Has 
this legislation been drafted yet, or if not, when do you plan 
on submitting it to Congress?
    Mr. Hawks. I actually do not know whether the legislation 
has been drafted. JoAnn, can you address that, or Stephen?

                             LICENSING FEES

    Ms. Waterfield. The legislation for packers and stockyards 
licensing fees has been drafted. It is in the clearance process 
in the Department.
    Mrs. Emerson. That portion of it has been drafted and then 
it will be submitted to the agriculture committee?
    Ms. Waterfield. Yes.
    Mrs. Emerson. Okay. Do you have any sense on the timing for 
the other pieces?
    Mr. Dewhurst. The other is the Animal and Plant Health 
Inspection Service. I think the status is the same. I think the 
legislation has been drafted. It is working its way through the 
process.
    Mrs. Emerson. As well as additional grain and inspection 
fees for grain standards?
    Ms. Waterfield. My understanding is the legislation for the 
grain standards has already been submitted.
    Mrs. Emerson. Okay. I appreciate that. Thank you very much. 
It is important for us to look over that if we want to get it 
done in a fairly rapid way. You know how the process up here 
works. It can take a bit of time.
    Let me direct the next question to you, Ms. Waterfield. 
Your budget request includes a total of about $3.4 million for 
various information technology and biotechnology initiatives 
that would enhance GIPSA's capabilities to conduct its work.
    This represents almost half of your total increase. Can you 
tell the committee how these technological enhancements would 
improve your work product and how American agriculture would 
also benefit?

                               E-COMMERCE

    Ms. Waterfield. The majority of the increases that you just 
mentioned are for e-commerce. It is to increase our ability to 
communicate with the constituents that we serve. Right now, the 
majority of the work that we do is done with a traditional 
paper trail. What we want to do is increase our ability to move 
the information that we have electronically on both sides of 
our house, both with the grain work that we do and with the 
work that we do in the livestock and packing industries. Most 
of the people that we serve and regulate have capabilities to 
communicate with us electronically. Unfortunately, we do not 
have the capabilities to communicate with them electronically. 
What we do have right now is a simple Web site. What we need to 
have is the ability to give and receive information 
electronically.
    On the grain side, we are just starting to have the ability 
to transmit documents from multiple sites. So like documents 
that will facilitate the shipment of grain from multiple sites 
all the way to the ship, we want to increase our ability to do 
that.
    On the packers and stockyard side, we have annual reports 
that we collect. We have postings that we do with stockyards. 
We have all kinds of information that we move back and forth. 
We have investigators stationed throughout the country that are 
constantly out in packing houses, and auction markets. We need 
to be able to move information to them immediately, so they 
have instant access, and the only way that we can do that is to 
upgrade our computer systems, and this is going to take a 
substantial amount of funding.
    On the biotech side we need $450,000 in order to update and 
keep our new facility in Kansas City up to date so that we can 
provide testing on lab kits and proficiency testing for 
laboratories that the industry uses to provide services to 
itself.
    Mrs. Emerson. How long you think it will take, at least on 
the packers and stockyards part, to get your upgrades or 
enhancements completed?
    Ms. Waterfield. The time line right now is to complete most 
of those by the end of fiscal year 2003, I think, but it is an 
ongoing process, so we do the best that we can with the current 
funding that we have.
    Mrs. Emerson. Is the system really pretty obsolete at this 
point in time?
    Ms. Waterfield. We have some national databases. We have 
three regional offices. Some of those databases are local. What 
happens with some of them is that they have to send it 
overnight. So we have a national database in DC, with local 
databases in the regional offices, so it is very cumbersome. 
What is most difficult is that we have resident agents in 38 
different locations, and it takes them a long time to get 
information from the computers.
    They have to call back to our offices, which means that we 
have to keep our offices staffed with people able to give them 
information, which means that we cannot send those people out 
to do investigations. And as you know, we have less than 200 
people to police a huge industry, so we do the best we can with 
limited resources.
    Mrs. Emerson. But you feel pretty confident that the plan 
you all have put together will solve the challenges that you 
presently have?
    Ms. Waterfield. Yes. One of the things that GIPSA did this 
year was to consolidate our information technology staff on the 
grain side and the packer side to make the best use of the 
resources we have. We are constantly looking for ways to 
increase our efficiency.
    Mrs. Emerson. I wish you the best of luck. I yield back to 
Ms. Kaptur.
    Ms. Kaptur. Thank you very much. I would like to continue 
on the AMS front here. I understand that the Department of 
Agriculture currently holds about 900 million pounds of nonfat 
dry milk as a part of its price support operations, which is 
about a 2-year supply or 2 years' production of milk, and I 
know it costs something to maintain that. I wonder if someone 
in the audience might be able to give us that number; but my 
real question is, does the Department, if you are anticipating 
further acquisition of such product, have the ability to 
contract with processors to get the milk in another form such 
as nonfat cheese, for example, or low fat cheese, that we could 
use in our food assistance programs?
    Mr. Hawks. I personally do not feel that comfortable 
answering this question because that is clearly one that is 
handled by the Farm and Foreign Agricultural Services. They 
handle the price support end of it. We are not involved with 
that, but I think Mr. Dewhurst would probably be the 
appropriate person to address that.
    Mr. Dewhurst. Well, you are right. We have a huge supply of 
nonfat dry milk in storage in Kansas City. I did not bring that 
number, but I can certainly provide it for the record, but we 
have large amounts of nonfat dry milk and sugar.
    [The information follows:]

    CCC COMMODITY INVENTORY NONFAT DRY MILK AND SUGAR--March 1, 2002
                          (Millions of pounds)
------------------------------------------------------------------------
                           Commodity                              Amount
------------------------------------------------------------------------
Nonfat dry milk................................................    914.7
Refined sugar..................................................    181.1
Raw cane sugar.................................................    588.2
------------------------------------------------------------------------

    Ms. Kaptur. You are saying that from a departmental 
standpoint, the people doing this are not thinking about what 
you all think about in terms of marketing, and so we have got 
to look at this one right, and one thing I do know the kids eat 
in the school is cheese on pizza, they will eat that, and it 
just seems to me it would be very interesting to see what that 
storage number is.

                  FOOD PURCHASES AND THE SMALL FARMER

    Similarly let me ask, I believe you purchase 683 million 
pounds of fruits and vegetables for the food assistance 
programs at a cost of about $340 million. My questions really 
are, if anyone could enlighten us on where you buy, whether it 
is from commodity brokers, wholesalers and how the individual 
farmers fit into this purchase process.
    Mr. Yates. Once we decide by analysis that there is some 
agricultural entity with an oversupply, an economic problem, we 
then go out to publish that need for bids, and so everyone who 
is in that commodity has the opportunity to bid on that, 
providing it meets the specifications. So those bids come 
forward and we select the lowest bid for the commodity. I don't 
know if that totally answers your question.
    Ms. Kaptur. Well, I am very curious, administrator Yates, 
in terms of how do individual farmers learn about these, and do 
they bid and what does the history show. Maybe you could 
provide this to the record. Are we basically getting commodity 
brokers or are we getting wholesalers? Are we getting 
individual farmers to bid into this? I don't know at what 
quantity you ask a supplier to provide you product, but again, 
this is an income stream that is out there for our farmers. My 
question is how much of it is actually getting to them directly 
as opposed to indirectly?
    Mr. Yates. When we put out a bid, there will be multiple 
cities that this product is going to be supplied to, and so 
each location has to be individually bid. Most of these bids, I 
will grant you, come from maybe a packing house where you will 
have multiple growers that supply this packing house. So it 
does get down to smaller growers through this larger packing 
house, but if you are taking most of the meat purchases, these 
are rather large purchases, and so it basically has to be a 
rather large company. We do deal with minority purchasers and 
try to help them through this process and be able to be a part 
of it.
    The small farmer issue--I think that most of that is done 
through cooperatives and bids that would come from a packer or 
a middleman that deals with their product.
    Ms. Kaptur. Is there a minimum volume limit that is 
established in the contract?
    Mr. Yates. I would be glad to check on that. I don't know 
that answer right offhand.
    [The information follows:]

    The minimum volume purchased is a truckload quantity--
generally 36,000-48,000 pounds. AMS normally does not buy 
directly from farmers because most commodities are at least 
minimally processed to meet recipient requests. For example, 
the program buys large quantities of ground beef and canned 
vegetables. While the majority of purchases are from businesses 
that pack and process commodities, many of these firms procure 
raw materials from independent small farmers. For example, 
while we purchase poultry products from some of the largest 
poultry processing firms in the country, small farmers provide 
the chickens to the processor. In addition, during fiscal year 
2001, approximately 50 percent of AMS purchases were from small 
businesses.

    Ms. Kaptur. Let me use one example. I am just trying to 
illustrate a point here because of the situation facing so many 
of our producers both on the livestock side and specialty crops 
and so forth, but just on livestock, in my part of the country, 
now we do not have the big feed lots like they do in the West, 
but the life of an individual beef producer cattleman in 
northwest Ohio is totally controlled by IBP over in Indiana, 
for the most part, and they can choose to welcome them that day 
or not because we do not have processing capability, and if 
they drive their animals across the State line and they try to 
get them slaughtered and they say sorry, we just closed the 
door, they have to drive them back, and they cannot get their 
product on the shelf of the local supermarket because the 
supermarkets tend to follow the same pattern of buying from the 
big processor.
    We are having a really giant struggle to try to find a way 
to bring really quality beef to the market because the 
processing capabilities are there no longer and this is 
happening across our country. We are not the only place that 
this happens, and so we have very good product raised by our 
individual companies, and so my question to you, I am looking 
for other ways to move to product into the market to help these 
people survive.
    They have got to meet the quality, they have got to meet 
the price and all the rest which they can do, but I have just 
seen the system move to a point where we have these large 
processing facilities that control so much, and they basically 
shut out individual producers.
    If there are co-ops, I know they exist in some parts of the 
country, that is one way up the chain, but Ohio, we haven't 
followed the co-op route as much. We are much more into small 
enterprise individual enterprise, and I am looking for ways to 
help those folks bid on product.
    So that is kind of where I am coming from. So whether it is 
fruit and vegetables, whether it is meat, whether it is milk, 
whatever, we will ask several questions for the record so we 
can see what is happening. It doesn't hurt us to look at what 
is happening out there in the system and then ask some 
questions about small and medium size enterprise and minority 
enterprise.
    Women are moving into many of these specialty crop areas. 
How do we get them information so at least they can think about 
how to bid?
    Mr. Yates. One of the interesting things I am very familiar 
with, and I was in the cattle business for 20 years myself, so 
I understand the issue you raise, but in the local area where I 
live in California, it is the center of the raisin industry for 
the United States, and the average raisin grower in the Nation 
is 30 acres. All of them happen to be right there within a 50-
mile radius of Fresno. So the average size is 30 acres, and we 
have bought numerous product in the last number of years, 
including some this year, through a packer that concentrates 
this product to prepare it for shipment. The small grower in 
that instance is benefiting greatly from the ability to move 
product through the school lunch program and the EFE program.
    Ms. Kaptur. Well, I have to say that I am considering some 
type of small farmer producer set aside. I want to see what the 
numbers show us, though, and we will submit more questions to 
the record on it. Thank you for thinking with us on this.
    Mr. Yates. I appreciate that.
    [The information follows:]

    During fiscal year 2001, AMS spent more than $1 billion on 
commodities. Of that amount, approximately 50 percent was awarded to 
small businesses, with firms participating in the Small Business 
Administration's 8(a) Program receiving 6 percent and Women-owned and 
Historically Under-utilized Business Zone businesses receiving almost 1 
percent each.

    Ms. Kaptur. My time is up.
    Mr. Bonilla [presiding]. Ms. Kaptur, if you have additional 
questions, you may proceed. My understanding is that there no 
other members have any remaining questions.
    Ms. Kaptur. All right. Thank you, Mr. Chairman, very much. 
I am trying not to make it too long here.
    We have several questions for the record, but let me ask 
you, Under Secretary Hawks, what role do you see yourself 
having in the marketing of biofuels? Here we are engaged in 
Enduring Freedom, this long and protracted effort, and our 
politics, in my opinion, totally tied to, unfortunately, the 
acquisition of oil from very undemocratic places in the world, 
a half of our trade deficit now centered in the import of oil 
from such democratic places, put that in quotes, as Saudi 
Arabia and Kuwait and the United Arab Emirates, even Iraq, 
which is such a dilemma, isn't it?
    I am just such, I am almost a zealot in the area of soy 
diesel and ethanol and any kind of cellulosic biofuel that we 
could produce. What do you see your role in helping this 
industry grow and prosper in our country in providing new 
income streams to our farmers?
    Mr. Hawks. In the position that I hold here, Under 
Secretary for Marketing and Regulatory Programs, and it is 
somewhat limited, but the tremendous asset that we have here 
and an opportunity that I see for us is within our market 
promotion and research programs that we oversee within AMS. We 
can work with those commodity organizations there to try to 
facilitate the development and expansion of areas like ethanol, 
like biodiesel, where a lot of research has been done within 
those market promotion programs. But then it would become a 
wider discussion, I think, within USDA, and it would probably 
be more appropriate to address with rural development.
    I can see rural development having tremendous opportunities 
there as well, and if it is a broad overarching question, then 
it goes to a governmentwide question, I would say, with the 
Department of Energy in conjunction with USDA. There are a lot 
of discussions going on, a lot of things going on, and where 
Mr. Dewhurst has the overall perspective from the Department of 
Agriculture, he very well may want to address some of these.
    Mr. Dewhurst. I think in the previous hearing we talked 
about providing you all with some crosscuts of the issue areas, 
and biofuels is one of them. We have some numbers and 
description that we will lay out for you showing what our 
various agencies do in that area.
    With regards to biofuels in the Department, there is work 
done at ARS and the CSREES in the form of research. There is a 
program in the CCC that subsidizes ethanol production. There is 
some work in the Forest Service and a number of other agencies, 
all overseen by a structure in the Department that looks at the 
question of energy policy and biofuels. So we will provide you 
with that information and be glad to.
    [The information follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Ms. Kaptur. I really think you have the keys to the 
kingdom. We have the keys to the kingdom. Now we just have to 
enlighten others.
    The Department of Energy historically, this is nothing 
against them, but I mean, they grew out of the nuclear industry 
so you have a very heavy prejudice there and weight of opinion 
of the side of nuclear. Those that like nuclear, so be it, but 
I am sort of in the renewables arena and what we can do.
    There is just a great article I talked about last night on 
floor of Congress written by Senator Lugar and the former CIA 
director, James Woolsey that was published in foreign affairs 
in late 1999 called The New Petroleum, and it talked about 
cellulosic biofuels, and I would just refer it to you just as 
truly pleasure reading and a view of the future. I would love 
to find a way to put a soy diesel pump or biofuel pump over at 
the USDA the same way we did farmers market and let people 
think a little bit about this, enlighten the American people.
    This should be part of that exhibit at the Smithsonian. 
This is the future for us and you have the collection 
capabilities, you have the research capabilities, you have the 
marketing capabilities, and within USDA, we need to ratchet it 
up a bit, and I think every single person there has a 
responsibility in helping to crystallize this for the American 
people, and frankly for us, so we can be more helpful in 
building a new future.
    Christine Todd Whitman just said this morning on C-SPAN 
that she drives an EP vehicle, ethanol powered vehicle. Just to 
tell you how seriously deficient we are in unlocking the keys 
to the kingdom, we had the head of the Forest Service up here 
the other day in our CS, and I said you have one of the largest 
fleets in the country. What percent of your vehicles are 
powered by biofuels? They are unconscious. They are not 
thinking about it. It isn't part of their mission, and so even 
within the Department we have a job to do. Enough said on that 
one.

                                IMPORTS

    I wanted to go to APHIS if I might and just observe that in 
the budget submission you have made to us there is increase in 
appropriated dollars to deal with many of the pests and 
problems we are having due largely to imports, and I have said 
this at other meetings, but I am going to say it again, and 
that is a huge international legal question, who is really 
responsible for paying the costs of infestation that affects 
our food system?
    If one takes the Asian long-horned beetle, for example, 
knowing its origin, why should I be asked to use taxpayer 
dollars sent here by people from my community and Congressman 
Bonilla's community when they did not cause the problem? They 
are the victim. The cities of Chicago and New York are the 
victims of infestation that has come from offshore.
    We have talked to the Secretary about the international 
trade agreements that we sign and some of the international 
forums in which she would appear. I really do not think the 
answer to this is more appropriations. That is a short-term 
emergency answer perhaps but long term, the cost of this is 
phenomenal, just on citrus canker and Asian long-horn beetle, 
the remediation.
    I know you have presented a traditional request to us, but 
as you think about this problem, it is massive, and it is 
taking other resources we need for other purposes, and I really 
think that the Department ought to consult with groups like the 
World Logging Institute to deal with torts and liability at a 
much higher level, because we are not going to be able to 
afford this, at least what we are going to have to take money 
from to pay for it, and I just wonder, Mr. Acord, as you think 
about the rising costs of the APHIS budget, if we look at the 
last 5 years, for example, what are some of your thoughts in 
this regard? Are you just going to continue coming to us to 
take taxpayer dollars directly appropriated to try to 
remediate? Is this how we are going to solve this problem, in 
your opinion?
    Mr. Acord. Well, philosophically, I would agree with you 
that we ought to try to find someone to send the bill to, if 
you will. The reality is where are we going to find that person 
or that country, the practicality, just the pragmatic issues of 
trying to do that and then trying to collect. Our legal counsel 
tells us that they do not believe that currently it is legal to 
do that or that we could find a way to do it, in spite of 
whether we would like to do it or not.
    The other side of that coin is that we may be getting bills 
from others. While we believe that we are clean in our exports 
and we are not exporting disease, you certainly have to face 
the possibility that that could happen because we do have some 
diseases here that we could get the bill for through some 
accidental introduction to some other country in the world.
    The reality is that we have to find new and creative ways 
to deal with these pests. We have to find them sooner. We have 
to react to them sooner before they become the kind of problem 
that citrus canker has been, or that some of the others have 
been. Frankly, we found the Asian long-horn beetle soon enough 
to where it did not become perhaps the national problem that it 
could have been.
    The focus needs to be on the early detection and rapid 
response to these kinds of pest problems that we keep the costs 
down, keep the spread down, and minimize the impact that they 
potentially can have in the U.S.
    Ms. Kaptur. I thank you for your comments, and I would just 
observe that yesterday or early this week, the President made a 
decision on the steel industry, and whether one agrees with the 
decision or not, there is a method of assessing damage and 
responsibility, and it is very important in the behavior of 
countries and companies to have a regular order in the global 
marketplace and rules that are understood, and I think that we 
are in the environmental arena, and I would classify this in 
the environmental arena. We need the same regimen, and if the 
United States does something to harm another country, you know 
what, I think we should be responsible, and I think that exacts 
a discipline on our own people.
    And so in this important area, I would appreciate, Mr. 
Acord, if you would think about this conversation a little bit, 
and if there are additional resources we could provide you to 
produce the kind of analysis that would lead us to a different 
future on this environmental front rather than just keep 
absorbing these costs through discretionary spending, I think 
we really need that. That report could include the rising costs 
that we have been asked to pay over the last several years, but 
it seems to me that we have to go beyond what your general 
counsel says is what the law allows.
    This is the problem. The law needs to be broadened because 
of the increased volumes of trade that the world is now 
experiencing. We have to find remedies to assess responsibility 
where harm has been done and we are the largest importing 
Nation in the world. I mean, we take more in here I think than 
any other country, and so we are more likely to be harmed, and 
I just would urge you not to be bound by the status quo, but to 
help us deal with the rising costs that you are bringing to us 
in a more future-oriented manner. At least give us some 
options, and if you need help in hiring the people to help 
think that through, please let us know.
    Mr. Acord. Thank you. We will take your advice seriously, 
and I believe the economic research service has been requested 
to do a study, or they have a request in this year's budget to 
do a study on the cost of invasive species and where we should 
be spending our resources, and we certainly look forward to 
that report.

                               SCREW WORM

    Ms. Kaptur. Okay. I wanted to just turn for a second the 
Chiapas facility. About 2 years ago, there was to have been a 
meeting to talk about the reuse of that facility in a very key 
area of southwest Mexico, and where there has been a lot of, I 
am sure you are aware indigenous unrest, and our government had 
been operating that facility for a very good biological purpose 
to eliminate, I think it was either screw worm or med fly.
    Mr. Acord. Screw worm.
    Ms. Kaptur. That is what I thought, and we had asked a 
prior administration to make a proposal to us that if we were 
going to diminish that facility and discontinue the activities 
that were ongoing, what recommendations we might have to turn 
it into a research station or a place where tropical fruits, 
for example, could be either researched or propagated working 
with the local people, but we never did get an answer back on 
that.
    Mr. Hawks. I will answer.
    Ms. Kaptur. All right. Secretary.
    Mr. Hawks. I was not here 2 years ago or even a year ago, 
but I can share with you what has transpired since my coming to 
USDA. We have completely, with our partners in that project, 
the Mexican government, and the Screwworm Commission, have 
reevaluated that situation. It is our intent now for that 
facility to stay open, and I have actually signed a decision 
memo to that effect. So it is actually a state-of-the-art 
plant. There have been a lot of upgrades there. There is a 
tremendous need for that facility there. There is also a need 
for an additional facility farther south, but the answer to the 
question is that that facility will be staying open, and I 
think the chairman has a certain interest in screwworms as 
well, and so we will assure you that that facility will be 
maintained.
    Ms. Kaptur. Thank you for that very clear answer. Will it 
be performing its current function?
    Mr. Hawks. Yes, ma'am. There is a continued need for that 
facility to produce the sterile flies there, and so it will 
remain open.
    Ms. Kaptur. I know that it was a huge employer in that 
area.
    Mr. Hawks. Yes, ma'am.
    Ms. Kaptur. And that was a very sensitive issue, and we had 
urged prior Secretaries to talk to AID and other 
instrumentalities of our government to do something, maybe 
working in cooperation with CSREES. They could raise coffee, 
they could raise tropical income. They basically need income. 
These are subsistence people. So I thank you for your attention 
to that, and if there is anyway we can broaden the purpose of 
that in conjunction with some of the other programs we operate, 
either through USDA or other instrumentalities of our 
government, I would appreciate the recommendations.
    I wanted to just shift, if I could very quickly, to the 
Packers and Stockyards Administration, and the testimony 
submitted indicates there were 124 callers who contacted your 
hotline last year to report concerns. Can you give us a little 
feel for the nature of those calls and what it is that is being 
reported to the Department?

                          GIPSA HOTLINE CALLS

    Ms. Waterfield. Those would just be the hotline calls. We 
receive hundreds of calls to our field offices. So that is 
actually just a hotline that allows people to call anonymously. 
It is important to realize that we receive calls every day 
throughout the year in each of our field offices, and we 
respond to every call that we receive. Last year we performed 
more than 1,600 investigations, and as a result of those 
investigations and the work that we performed, we returned more 
to the industry than the amount of money that Congress 
appropriated to our programs. I would have to get back with you 
on the nature of the calls that we received and the breakdown 
of the types of complaints that we received.
    Ms. Kaptur. Give us a sense of what happens there with the 
hotline call. Do people call with a concern about a given 
facility?
    Ms. Waterfield. Sure. Our complaints on the hotline range 
anywhere from a call about the Johnson amendment to a specific 
packer, to a poultry grower complaining about his or her 
contract, to a complaint about territorial allocation, to 
someone calling to say that she did not get paid for a cow that 
went through a sale barn. So they range anywhere from a 
particular transaction to conditions in the marketplace.
    Ms. Kaptur. Well, we will ask some questions to the record 
on the nature of the calls and the types of complaints. That 
gives us information that we need here as well----
    Ms. Waterfield. Okay.
    Ms. Kaptur [continuing]. To give a sense of what is 
happening in the country. I know that we have been joined by 
Mr. Nethercutt, and I have some additional questions on GIPSA, 
but I will hold them, Mr. Chairman, if you would like to call 
on Mr. Nethercutt.
    Mr. Bonilla. Thank you, Ms. Kaptur. We have a lot of 
members of the Agriculture Subcommittee juggling several 
hearings this morning. We welcome Mr. Nethercutt who has been 
bouncing between hearings and the House floor as well. Welcome, 
Mr. Nethercutt.

                           ANIMAL WELFARE ACT

    Mr. Nethercutt. Thank you, Mr. Chairman. You are right, 
Defense and Interior, and now here. I appreciate your patience.
    Mr. Chairman I welcome all the witnesses. You may have 
known that I and many others in the Congress are concerned 
about the issue of security of our research facilities that are 
funded by agriculture research dollars from what I call 
domestic terrorist groups, like Earth Liberation Front, and the 
Animal Liberation Front. These groups get information off Web 
sites about researchers and research through the Freedom of 
Information Act, and then use that information to do damage. I 
think it is outrageous, and I do have legislation that 
addresses this issue and tries to solve that problem.
    Secretary Hawks, we did send you a letter on February 8, 
2002. You probably haven't had a chance to even look at it yet, 
but in that letter, we encouraged APHIS to work with the 
research community to evaluate the problem I will call 
overexposure. I am informed that some of the material has been 
taken off the web, and that is positive. I know there are legal 
issues to review regarding security in the Freedom of 
Information Act and so forth, but I know also that the older 
American Welfare Act or Animal Welfare Act inspections are 
still available. I think they ought to be looked at very 
carefully as well.
    Maybe you have some comments about how we might think 
through this whole issue of security from these kinds of 
organizations that really are terrorist in nature. The FBI says 
ELF & ALF are the number one domestic terrorist group in the 
country. I think we should consider whether we might insulate 
some of this information from Freedom of Information Act 
requests. I know it is a sensitive area, and I support FOIA, 
but I do think we need to be careful about this as it relates 
to researchers and research dollars. So maybe you have some 
thoughts.
    Mr. Hawks. Yes, thank you, Mr. Nethercutt. I share your 
views and your beliefs. It doesn't matter whether a terrorist 
is homegrown or imported, they are still a terrorist, and we 
have been evaluating the types of information that is on Web 
sites, the information that is readily available. And you are 
correct, some of the things have certainly been changed that 
are being put up. It is a sensitive nature with the FOIA. There 
have been some changes made there in animal care as well on E-
FOIAs, and so we are evaluating that. I share your concerns.
    I share your interest there. We will continue also 
departmentwide evaluating all of our security issues there. We 
have had some external contractors look at some of our 
facilities to help us try to discover ways to prevent the 
terrorist activities that potentially could be there. So we are 
working on this issue.
    Mr. Nethercutt. Well, that is great. I hear a lot, from 
researchers all across this country, not just ag researchers, 
but private researchers. I have a brand new health sciences 
facility in my district. The universities there collaborated 
and put the money up. They are worried about people coming in 
and burning them down. Really, I think forewarned is forearmed. 
I think we need to be sure these places are protected.

                            WOLF ACTIVITIES

    Mr. Acord, I know that APHIS conducts livestock protection 
activities for resource owners around the country in 
cooperation with private and government agencies, and I see 
that you mention wolf capture and relocation activities in your 
testimony. A couple of years ago, I asked a question regarding 
the cost of the wolf program and whether the Department of 
Interior, which manages that program, is paying for its fair 
share of the control cost. Can you tell us what the 
relationship is there, whether your budget is benefited by the 
fact that Interior's helping on this?
    Mr. Acord. Mr. Nethercutt, thank you for your question. I 
think you can see from our appropriation request that we 
obviously have a deep interest in wolf control. We are 
certainly providing all the control for protecting livestock 
and the movement of or the relocation of wolves. Interior does 
not fund any of that activity. It all comes out of the wildlife 
services appropriation.
    Mr. Nethercutt. Given that, it seems to me we have got a 
lot of pressure on ag programs. I am on the Interior 
Appropriations Subcommittee too, so I will ask Secretary Norton 
in due course, about this issue. It is their program, as I 
understand it, and I have questions about it.
    I think my memory is that we had testimony a few years ago, 
that the cost of reintroduction of 15 wolves into my part of 
the country was $6 million. That seems excessive to me, but in 
any event, it is costing you money, and I think money is at a 
premium these days for all that you need to do and want to do.
    Mr. Acord. Mr. Nethercutt, the cost of reintroduction is 
not nearly as expensive as the cost of staying, and that is 
what we deal with, the cost of the presence of the wolves when 
it comes to their depredation on livestock. That is an expense 
often overlooked in the reintroduction program, and it is 
something that needs to be considered.
    Mr. Nethercutt. Thank you, Mr. Chairman. Thank you all for 
your testimony.
    Mr. Bonilla. Thank you, Mr. Nethercutt. I have a comment on 
your point about the agri-terrorism issue. That is a very 
important issue. These people, in my view, are terrorists 
because they have no regard for human life. They will destroy 
anything just to make a statement. I want to applaud you for 
your work on this issue. I know last year we had a discussion 
about possibly putting something in our bill for this cause. 
However, last year, members of this subcommittee were extremely 
cooperative in getting the bill done. We did not put any 
authorizing language of this nature in the bill. I have to tell 
you, if I had to pick one issue this year, that would be the 
one we would put in this year's bill.
    Mr. Nethercutt. Well, it is a new year. We will keep 
talking.
    Mr. Bonilla. We want another clean bill this year, but 
seriously, George, that is a very, very important issue that I 
fully support. I hope we can get that done somehow. Thank you.
    Ms. Kaptur.
    Ms. Kaptur. Thanks, Mr. Chairman, I have got my last round, 
and I wanted to go back to GIPSA if I could, the packers and 
stockyards, and I have many questions for the record, but I 
wanted to ask you if your agency receives complaints regarding 
the poultry industry in this country.

                      POULTRY INDUSTRY COMPLAINTS

    Ms. Waterfield. Yes, ma'am. In fact our Atlanta office is 
our office that specializes in the poultry industry.
    Ms. Kaptur. Oh. Could you tell us a little bit about what 
the nature of those complaints might be? Can they be 
categorized? Is there a way to describe them? Do they receive 
more complaints than maybe other industries?
    Ms. Waterfield. Primarily, the nature of the complaints is 
that growers in the chicken industry are complaining about 
unfair treatment from their integrators under contract terms, 
and the vast majority of the time when we go out to 
investigate, we find that we can either resolve the complaints 
informally, meaning that the integrators will come into 
compliance with the contract terms or the complaints are not 
valid.
    Ms. Kaptur. I tell you, I was very surprised too; I went up 
to Delmarva Peninsula a couple of years ago, and walked through 
many of those farms and operations and met with some of the 
large processing companies then, and one of the impressions I 
took away with me from that trip, at that point, how the 
farmers had signed contracts that they really did not, they did 
not protect their own interests, and they were being asked to 
do things, and that started us off on this cause of trying to 
get USDA to put up on the Web a sample contracting site, which 
then USDA said they could not do, and I said, well, do not put 
up a specific contract, put up some samples of what the 
questions farmers should ask before they sign.
    Ultimately, USDA was helpful there, but I found great lack 
of information in the agriculture community on contracting and 
I was actually surprised because I had never experienced that 
before.
    One specific experience, I had one farmer I pointed out a 
manure pile because of the pollution in Chesapeake. Oh, 
Congresswoman, he thought I was going to cite him or something, 
he said we are going to get rid of that, we are going to get 
rid of all that, and the company is going to haul it away. I 
said haul it away? I said, sir, that is the one thing I know 
you own on this operation and you should actually sell that. 
That wasn't in the contract. I mean, I just could not believe 
some of what I learned.
    Then I went to one of the processing firms, and during 
lunchtime, one of the executives showed me a bottle where they 
had pelletized manure, and what a growth market that was for 
them and all, and I just had this experience with this farmer 
and then having the experience with the company. I thought 
something is missing, and so I appreciate the Department's 
support of our measure H.R. 231, to provide you with 
administrative authority to investigate, and I know Mrs. 
Emerson is a cosponsor with me.
    Ms. Waterfield. And Congresswoman, we are dramatically 
increasing our outreach to producers and growers, particularly 
in the poultry industry. Last fiscal year, we had about 20 
poultry town hall meetings specifically geared at growers to 
make sure that they understood the protections afforded them by 
the Packers and Stockyards Act, and we are trying each year to 
reach out further to growers to make sure that they understand 
that we are there and that they are one of the intended 
beneficiaries of the Act, even as the Act is written now.
    So we are trying to increase our efforts to reach them and 
to make sure that they understand what the Act does do, and AMS 
has led the effort within the Department to provide more 
information on contracting and what producers and growers 
should look for in contracts.
    Ms. Kaptur. Is there a simple way for you to describe to me 
what you can do with a complaint about bad practices in the 
livestock industry versus the situation you face in the poultry 
industry and what your powers are?
    Ms. Waterfield. In the poultry industry, our jurisdiction 
is limited to live poultry dealers and to any growing 
arrangements where poultry is grown for the purpose of 
slaughter. And as you know, the poultry industry is pretty much 
vertically integrated, which means that most growing of any 
kind of poultry is done under contract which would include any 
kind of eggs or hens, anything like that.
    The problem is that there is a huge misconception about our 
jurisdiction. We do not have jurisdiction over any kind of 
contracts for egg layers, for example, because those contracts 
are not done for the purpose of slaughter. Those contracts are 
done for the purpose of laying eggs. So even though the 
contracts are in place until the hens are spent and go off to 
slaughter, the purpose of those contracts is for the hens to 
lay eggs. We do not have jurisdiction over those and our 
jurisdiction is very limited, to only those contracts over 
growing arrangements for the purpose of slaughter.
    Ms. Kaptur. Who does have jurisdiction over?
    Ms. Waterfield. No one. That would fall to State law and 
contract law.
    Ms. Kaptur. You know what is interesting about that, in my 
State, we have one company that produces 2.6 billion eggs a 
year and they have refused to comply with eight contempt of 
court citations by our State Attorney General. I don't know if 
you have been involved in cases that have reached the point of 
having contempt in the livestock industry. Do you know of any 
where eight have been rejected by the company or not responded 
to, ignored?
    Ms. Waterfield. We have had several. There have been three 
or four, and generally in the livestock industry when that 
happens, usually because we are working through the Department 
of Justice at that point in time, we are able to get the person 
incarcerated.
    Ms. Kaptur. Okay.
    Ms. Waterfield. So one of the contrasting differences is 
that in the livestock industry we have civil penalty authority. 
Our jurisdiction is broader. We don't rely on State law. It is 
a Federal law. When we have a case involving contempt, if the 
Secretary were to take it to the Department of Justice, then it 
goes to Federal court. The Federal court judge then takes it 
more seriously. After several contempt instances, there is 
usually a probationary period and then incarceration. So what 
we find is that when we have a problem with violation of the 
law, we are taken more seriously, and so that is why we have 
supported your efforts to expand our authority.
    Plus, as we have just discussed from your reaction, I can 
tell there is a lot of confusion about what our authority is in 
the poultry industry. So we are constantly trying to explain to 
folks in the poultry industry that, I am sorry, we do not have 
jurisdiction over your contract because your contract is to 
produce eggs. It is not a contract to grow for the purposes of 
slaughter, and people do not understand that.
    So for lots of different reasons we would like to see our 
jurisdiction expanded.
    Ms. Kaptur. If there were to be a Federal agency 
responsible for oversight on the egg-laying aspect, would that 
be FDA, if the law permitted it, it wouldn't be your agency, 
you are saying, because you say you are only involved in 
slaughter?
    Ms. Waterfield. No.
    Ms. Kaptur. I know that, but if one were to think about who 
should be the logical instrumentality?
    Ms. Waterfield. It would probably be us, because the idea 
is to police unfair practices between the person growing or 
handling the chickens and the integrator or the processor. So 
you are basically overseeing the contract, which is we are 
overseeing the practices between the two parties, which is 
basically what we do in the other types of contracts that we 
are looking at. We are policing that industry for unfair 
practices in any other type of situation, so the contract 
specifies how the parties are to relate to one another. We just 
go in and make sure the contract terms are being applied fairly 
and uniformly.
    Ms. Kaptur. I thank you very much. It has been an 
enlightening discussion, and thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Ms. Kaptur. Mr. Goode has just 
joined us. I will yield to Mr. Goode.

                                HYDRILLA

    Mr. Goode. Thank you, Mr. Chairman. I have really one 
question, probably to Mr. Acord. Can you tell me what you are 
doing researchwise, and also in working with communities in 
combatting hydrilla in inland lakes.
    Mr. Acord. We are not doing very much with that at all. 
That is research done by ARS and the other kind of outreach and 
discussion with communities would be done through the 
cooperative extension service and through State agencies.
    Mr. Goode. So your division then is not focusing on 
hydrilla at all?
    Mr. Acord. Not to any great extent. We have, in the past, 
performed control work on hydrilla, but it is very, very 
limited, and we haven't seen an expansion of that in a long 
time.
    Mr. Goode. That work that you did do, was it fruitful?
    Mr. Acord. In some cases we were successful. In others we 
were not. It depends on the level of local cooperation and 
local participation. I don't believe we are going to get into 
any larger-scale programs at this point.
    Mr. Goode. In the last 5, or even 10 years, where have you 
done hydrilla?
    Mr. Acord. We have done some technical assistance work with 
Virginia, some here in Potomac, or in the Potomac River. There 
is some work that was been done a number of years ago. Other 
sites, I cannot tell you specificly as to where we have done 
it, but we could certainly provide that for the record.
    Mr. Goode. Could you just tell me the sites you looked at 
in Virginia and when you did.
    Mr. Acord. The only ones that I am aware of was on the 
Potomac River.
    Mr. Goode. Okay. Thank you, Mr. Chairman.
    [The information follows:

    APHIS is aware of various hydrilla projects in the past for applied 
methods and in inland lakes. These projects include the following:
           APHIS Whiteville North Carolina Methods Development 
        Lab led a Hydrilla project in the 1981-93. Efforts included 
        pesticide treatment methods and use of triploid grass carp, 
        mostly centered in Florida and the Imperial Valley irrigation 
        canals of California.
           APHIS funded operational programs in irrigation 
        canals in Mexico for the last several years. In 2002, APHIS is 
        funding part of a Hydrilla triplois carp program in the lower 
        Rio Grande river, in cooperation with the Bureau of 
        Reclamation. This is a matching grant through the Pulling 
        Together Initiative (PTI) sponsored by Federal Interagency 
        Committee for Management of Noxious and Invasive Weeds, and 
        managed by National Fish and Wildlife Foundation.
           Several aquatic weed survey efforts have been 
        conducted including a Hydrilla survey though the PTI in recent 
        years. Such a PTI grant funded in 2002 is an aerial survey 
        project with Maryland Department of Natural Resources.
           APHIS has funded a small project on biological 
        control of Hydrilla at Wakula Springs, near Tallahassee, 
        Florida through a cooperative agreement with Florida A & M 
        University. There appears to have been some survey and/or 
        technical support efforts done or coordinated by Whiteville Lab 
        in Virginia in the past, but not specifically by APHIS for 
        control or eradication projects.
           In the past, state-funded pass-through money to the 
        Virginia Department of Agriculture may have been provided to 
        local cooperators. A private control company contact indicates 
        several current privately funded Hydrilla control projects in 
        Virginia combine integrated use of pesticides and triploid 
        grass carp.

    Mr. Bonilla. Thank you Mr. Goode. We appreciate you all 
being here today and look forward to working with you as we put 
our bill together this year. We appreciate your patience with 
the vote we had that interrupted us for a few minutes, and we 
appreciate the subcommittee members who are juggling a lot of 
hearings today.
    Mr. Nethercutt mentioned the defense hearing. I happen to 
be on that one too. I missed the whole thing, but we are going 
to get our jobs done this year the best we can. At this time 
the subcommittee will stand adjourned.

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]




                           W I T N E S S E S

                               __________
                                                                   Page
Acord, B. R......................................................   409
Dewhurst, S. B...................................................   409
Hawks, W. T......................................................   409
Kaplan, Dennis...................................................     1
Reed, P. S.......................................................     1
Rey, M. E........................................................     1
Thomas, Brenda...................................................     1
Waterfield, JoAnn................................................   409
Yates, A. J......................................................   409




                               I N D E X

                               __________

                 NATURAL RESOURCES CONSERVATION SERVICE

                                                                   Page
Administrative Efficiencies......................................    28
Agricultural Management Assistance...............................   245
Air Quality......................................................   102
American Customer Satisfaction Index.............................     2
American Farm Bureau Federation Concerns.........................   227
American Heritage Rivers.........................................   157
Animal Agriculture and Production................................   158
Animal Feeding Operations (AFO):
    Environmental Risks..........................................    30
    Impacts......................................................    50
    Technical Assistance...................................... 163, 190
Barthel v. USDA..................................................   227
Biobased Fuels..................................................95, 230
Biographies:
    Mark Rey, Under Secretary Natural Resources & Environment....    11
    Pearlie Reed, Chief, NRCS....................................    23
    Lawrence Clark, Deputy Chief for Science and Technology......    24
    Brenda M. Thomas, Acting Budget Director, NRCS...............    25
Budget for Under Secretaries.....................................    37
Colleges and Universities Agreements.............................   182
Commitment to Conservation.......................................    36
Congressional Projects Funding...................................   173
Conservation Compliance..........................................   122
Conservation Infrastructure......................................29, 51
Conservation Operations (CO):
    Allocations of Funds.........................................   179
    Erosion......................................................    33
    Funding Request..............................................   216
    Increased Funding..........................................176, 238
    Pay Cost Increase............................................   210
Conservation Programs:
    Farm Bill Applications.......................................   239
    Land Covered.................................................    90
    Land Toxicity................................................    50
    Private Lands Conservation...................................12, 76
    State and Local Funding Activities...........................   124
    Technical Assistance Funding..........................124, 125, 176
Conservation Reservation Enhancement Program.....................    39
Conservation Reserve Program (CRP):
    Costs-Share Policy..........................................41, 182
    Funding......................................................   204
    Pilot Acreage................................................   225
    Technical Assistance Funding...............................197, 207
Conservation Security Program....................................37, 24
Conserving Soil and Water........................................    34
Customer Service Rating..........................................    29
Dought Risk Assessment...........................................   241
Emergency Watershed Program (EWP):
    Emergency Watershed Program.............................3, 141, 195
    Draft Environmental Impact Statement.........................   196
    Flood Plain Easements........................................   173
Environmental Quality Incentive Program (EQIP):
    Acreage and Funding..........................................   161
    Allocation Method............................................   159
    Farm Bill Funding............................................   204
    Priority/Non Priority Area Funding...........................   156
    Planning.....................................................   249
    Technical Assistance Reimbursement...........................   173
Explanatory Notes................................................   251
Farm Bill Conservation Programs.................................51, 238
Farm Bill Conservation Title....................................35, 229
Farm Size and Concentration....................................245, 247
Farmland Protection Program (FPP):
    Cumulative Summary...........................................   101
    Farmland Protection Program..................................    99
    Forest Legacy................................................    96
    Funding......................................................   226
    Funds Awarded................................................   100
    Funds Requested..............................................   100
Flood Plain Easements............................................   134
Florida Farm Foundation..........................................    52
Foreign Assignments..............................................   155
Forest Service Issue.............................................    35
Forest Service Vehicle Fleet and Alternative Fuels...............   230
Forestry Incentives Program....................................194, 204
Funding for:
    Advisory and Assistance Object Class.........................   211
    Land and Structures Decrease.................................   211
    New Information Technology Through CCE.......................   194
    Staff Year Costs.............................................   224
    The Environmental Conservation Acreage Reserve Program.......   225
    Water Quality Incentives Fiscal Years 1996-2003..............   145
GIS Activities...................................................   126
Grants and Agreements..........................................205, 214
Grazing Lands:
    Acreage....................................................237, 239
    Funding....................................................151, 152
    Specialists..................................................   151
    Technical Assistance Staff Years.............................   151
Grazing Lands Conservation Initiative (GLCI):
    Allocation...................................................   198
    Budget.......................................................   151
    Funding......................................................   158
    Increase.....................................................   188
Guidance for Reprogramming Proposals.............................   105
Headquarters Carry Over Funds....................................   210
Headquarters Staff...............................................   122
House and Senate Farm Bills......................................   238
Hypoxia in the Gulf of Mexico....................................   150
Illinois River Basin Pilot Project...............................   197
International Activities.........................................   150
International Involvement........................................   247
Introduction of Witnesses........................................     1
Land Owners Important Decision Makers............................   103
Land Stewards....................................................    30
National Grazing Land Technology Institute Funding...............   152
National Grazing Lands...........................................   188
National Soil Information System.................................   127
Northwest Salmon Recovery Initiative.............................   157
NRCS:
    Funding Requests.............................................   153
    Office Closures..............................................   197
    Staff Year Table.............................................   123
    Staffing Levels..............................................   153
    Vehicle Fleet and Alternative Fuels..........................   231
Object Class Breakdowns..........................................   163
Opening Remarks by Mr. Bonilla...................................     1
    Outsourcing Plan.............................................   217
    Performance Goal Pilot Project...............................   193
Personnel Actions................................................   187
Plant Materials Centers (PMC):
    Funding....................................................127, 128
    New Releases...............................................129, 130
    Royalty Collection...........................................   134
Private vs. Public Land Tree Cover...............................    76
Program Evaluation Studies.......................................   135
Question Submitted for the Record:
    Chairman Bonilla.............................................   121
    Mr. Latham...................................................   227
    Ms. Kaptur...................................................   230
    Mr. Farr.....................................................   249
Resource Conservation & Development (RC&D):
    Allocation to Centers and Institutes.........................   206
    Applicant Areas........................................49, 155, 191
    Applications Pending Approval.........................187, 190, 192
    Areas Funded..........................................156, 176, 204
    Council Funding............................................190, 192
    Councils Role................................................   187
    Federal and Non-Federal Assistance...........................   143
    Funding Request..............................................   216
    Loans........................................................   145
    Measures Adopted, Planned, and Completed.....................   144
    Northwest Iowa Prairie RC&D..................................   229
    Resource Conservation & Development.....................3, 196, 231
Regional Project Allocations.....................................   148
Reimbursements for Soil Surveys..................................   127
Relationship with EPA............................................    31
Report on Allocations to States..................................   207
Reprogramming:
    Authority....................................................   104
    Funds........................................................    49
Soil Surveys:
    Completed and Published......................................   126
    Funding and Staffing.........................................   155
    State Listing................................................   200
State and Local Appropriations...................................   123
State and Local Funding........................................134, 163
Status of Texas Field Office Telecommunications Pilot Program....   210
Suwannee River Basin.............................................    26
Tanana River Assistance..........................................   197
Technical Assistance for all Conservation Programs...............   125
Technical Centers................................................   123
Technical Service Centers and Regional Offices and Institutes....   123
Termination of Water Resources Program...........................    32
Third-Party Vendors..............................................   103
TMDL and CAFO Rules Compliance...................................    31
Transfer of GSA Rent Costs.......................................   216
Urban Resources Partnership......................................   196
Urban Sprawl....................................................96, 233
Water Quality:
    Examples.....................................................   146
    Regional Projects..........................................148, 149
Watershed and Flood Prevention Operations (W&FPO):
    Funding Request.......................................163, 195, 216
    Geographic Breakdown.......................................136, 137
    Unobligated Balance..........................................   139
Watersheds:
    Allocation to Headquarters...................................   206
    Current Status of PL-534 Projects............................   135
    Watershed Program.....................................102, 193, 235
    Watershed Program Termination................................    27
    Watershed Projects Backlog...................................   189
    Watershed Projects Modified or Deleted During FY 2001.142, 143, 189
    Watershed Protection.........................................26, 30
    Watershed Rehabilitation..........................38, 120, 205, 216
    Watersheds Summary...........................................   140
Wetlands Reserve Program (WRP):
    Acres......................................................121, 182
    Farm Bill Acreage............................................   226
    Staffing and Costs.........................................121, 182
Wildlife Habitat Incentives Program Funding......................   226
Written Testimony:
    Statement of Mark Rey........................................     5
    Statement of Pearlie S. Reed.................................    13

                     AGRICULTURAL MARKETING SERVICE

Administrative Expenses..........................................   587
ADP Purchases....................................................   591
Biography, Administrator, A.S. Yates.............................   457
Electronic Business Standards....................................   625
Electronic Marketing.............................................   624
Explanatory Notes................................................   641
Farm Bill........................................................   620
Farmers Market.................................................573, 622
Federal Milk Order Program.......................................   615
Federal Seed Act.................................................   579
Federal Seed Program......................................532, 608, 629
Food Purchases and the Small Farmer..............................   539
Food Purchases, Linkage of with Nutrition Reports................   625
Global Market Expansion..........................................   626
Grading..........................................................   568
    Cotton and Tobacco...........................................   591
    Grading Fee Increase.........................................   569
    Qualified Through Verification Program.......................   592
Inspection and Certification of Equipment........................   601
International Standards..........................................   606
International Trade Prices and Volume............................   599
Lamb Grading and Certification Support...........................   615
Livestock Mandatory Price Reporting..............................   601
Local Food Purchases.............................................   535
Market News:
    Reports......................................................   569
Mandatory Price Reporting........................................   562
Microbiological Data Program:
    Baseline Data..............................................632, 636
Opening Statement................................................   442
Organic Certification Program....................................   558
Organic Labeling.................................................   619
Payments to States and Possessions.............................652, 579
Perishable Agricultural Commodities Act..........................   585
Pesticide Data Program....................................577, 602, 608
    Great Lakes Watersheds.......................................   629
    INternational Marketing......................................   619
    Re-Registration..............................................   588
    Rapid Response...............................................   600
    Spending by Agency...........................................   600
Pesticide Recordkeeping Program..................................   589
Plant Variety Protection Act.....................................   592
Producers, Small and Medium......................................   620
Program Fee Increase.............................................   569
Questions Submitted for the Record:
    Chairman Bonilla.............................................   557
    Mr. Kingston.................................................   616
    Ms. Kaptur...................................................   619
    Mr. Farr.....................................................   636
Referenda........................................................   578
Reports:
    GAO Report Findings..........................................   596
    OIG Report Findings..........................................   594
Research and Promotion....................................577, 597, 616
    Pork Check-Off Program.......................................   630
    Task Force...................................................   606
Research Cooperative Agreements..................................   597
Retail Marketing.................................................   624
Section 32:
    Commodity Procurement........................................   616
    Commodity Purchases and Nutrition.....................582, 601, 612
    Surplus Removal..............................................   581
    Emergency Surplus Removal..................................580, 614
    Export Purchases.............................................   582
    Summary of Pork Purchases....................................   599
    State Option Contracts.......................................   612
    Un-obligated Balances........................................   612
    Removal of Defecting Commodities.............................   613
    Direct Payment Program.......................................   613
    Spending.....................................................   614
Standardization..................................................   567
Tobacco Programs.................................................   568
Trade Agreements.................................................   620
Transportation...................................................   590
Transportation and Marketing Programs............................   617
Transportation System............................................   607
Wholesale Market Development...................................570, 574
Witness Statement--AMS...........................................   443

               ANIMAL AND PLANT HEALTH INSPECTION SERVICE

Accomplishments.................................................895-896
Agricultural Quarantine Inspection....759-765, 790, 791, 794, 806, 897,
             907
Ames Facility....................................................   902
Animal and Plant Health Regulatory Enforcement...................   786
Animal Health Monitoring and Surveillance.......................898-899
Animal Import Centers...........................................782-783
Animal Welfare/Animal Care.................................708-750, 887
Argentine Citrus................................................793-794
Asian Longhorned Beetle.........................................791-792
Automated Targeting System.......................................   911
Avian Influenza..................................................   900
Aviation Operations and Safety...................................   797
Biologics.......................................................788-789
Biotechnology..................................................784, 902
Bison Quarantine Facility........................................   885
Boll Weevil.......................................756-757, 884-885, 891
Bovine Spongiform Encephalopathy...........................878-879, 900
Brown Citrus Aphid..............................................785-786
Brucellosis...............................................751, 805, 885
Budget Request.................................................785, 910
Cattle Ticks....................................................765-766
Chronic Wasting Disease.........................................885-886
Citrus Canker.....................................799-800, 858, 889-890
Civil Penalties..................................................   756
Commodity Credit Corporation......................801-802, 805-806, 908
Congressional Directives........................................858-875
Contingency Funds...............................................782-783
Cost Share......................................................908-909
Emergency Authority........................................773-777, 808
Emergency Management System................................799, 879-880
Emergency Preparedness...........................................   899
Exotic Ticks....................................................877-878
Exports....................................................896-897, 904
Farm Bill......................................................892-8984
Federal/Non-Federal Dollars.....................................780-781
Feral Swine............................................800-801, 809-810
Financial and Personnel Resources................................   892
Food Safety.....................................................911-912
Foot-and-Mouth Disease...........................................   752
Foreign Animal Diseases.......................787-788, 806-807, 876-877
Foreign Pests and Diseases...............894-895, 896, 897-898, 907-908
Fruit Fly.........................................752-753, 875-876, 894
Genetically Engineered Crops.....................................   906
Grants to States.................................................   900
Grasshopper......................................................   888
Golden Nematode.................................................887-888
Health and Safety Standards.....................................905-906
Homeland Security................................................   875
Imported Fire Ant..........................................789-790, 798
Imported Meat...................................................910-911
Integrated Systems Acquisition Project..........................757-758
Interceptions....................................................   897
International Programs..........................................784-785
Invasive Species...........................................904-905, 906
Kapra Beetle....................................................900-901
Kudzu............................................................   790
Livestock Protection Program....................................810-811
Management Information System....................................   809
Management Information System....................................   809
Medicine.........................................................   900
National Germplasm Quarantine Center.............................   769
National Monitoring and Residue Analysis Laboratory..............   787
National Wildlife Research Center................................   794
Nonlethal Methods..........................................790-791, 903
Noxious Weeds..............................................755, 888-889
Object Class Breakout...........................................811-858
Outbreaks of Pests and Diseases.................................770-773
Overseas Locations.........................................778-779, 895
Palmer Alaska Facility...........................................   805
Pest Detection..................................................881-884
Pierce's Disease................................................804-805
Pink Bollworm..................................................781, 889
Plum Island Animal Disease Center...............................769-770
Plum Pox Virus...................................................   886
Port Information Network Operations..............................   911
Predator Control...............................................796, 802
Pseudorabies....................................................753-755
Public Information Campaigns.....................................   898
Questions Submitted for the Record:
    Mr. Bonilla..................................................   708
    Ms. Kaptur...................................................   892
    Ms. DeLauro..................................................   910
Rabies.....................................................786, 802-803
Regionalization.................................................807-808
Research and Development Contracts...............................   813
Saltcedar Tree...................................................   789
Scrapie........................................................765, 886
Screwworm......................................................795, 801
Silverleaf Whitefly............................................783, 790
Smuggling Interdiction.........................................897, 898
Sudden Oak Disease...............................................   799
Testing..........................................................   903
Travel..........................................................813-858
Tropical Bont Tick..............................................777-778
Trust Fund Agreements...........................................792-793
Tuberculosis.....................................................   757
VAC-TRAC Verification System.....................................   797
User Fees.............................................783-784, 794, 808
Wildlife Services............................766-768, 796, 802, 808-809
Wolf Control....................................................795-796

        GRAIN INSPECTION, PACKERS AND STOCKYARDS ADMINISTRATION

ADP Hardware/Software Purchases.................................. 1,050
Aflatoxin Inspections............................................ 1,040
Anti-Competitive Behavior........................................ 1,051
Anti-Competitive Provisions of the P&SA.....................1,055-1,056
Auction Market Failures.......................................... 1,043
Anti-Competitive Practices..................................1,060-1,061
Biography of Deputy Administrator Waterfield.....................   484
Biosafety Protocol..........................................1,054-1,055
Biotechnology.................................................... 1,054
Biotechnology Facility........................................... 1,052
Carcass Merit Purchasing Technologies.......................1,057-1,058
Comparison of International Standards............................ 1,062
Competition, Fair Trade Practices, Financial Protection.......... 1,046
Competitive Structure of the Poultry Industry.................... 1,051
Complaints From Livestock Producers.............................. 1,035
Custodial Account Compliance Audits.........................1,045-1,046
Dealer Failures.................................................. 1,047
Dealer/Order Buyer Financial Failures.......................1,041-1,042
E-Commerce......................................................537-538
Economic/Statistical Analysis...............................1,046-1,047
eGovernment Initiatives.......................................... 1,056
Explanatory Notes...........................................1,067-1,108
Exported Grain Complaints........................................ 1,040
Foreign Complaints Regarding U.S. Grain Exports.............1,064-1,065
Four Firm Concentration.....................................1,042-1,043
FY 2003 Budget Request........................................... 1,046
GIPSA Hotline Calls..............................................   550
GIPSA Opening Statement.........................................458-483
Grain Dust Explosions............................................ 1,040
Grain Facilities............................................1,035-1,036
Grain Inspected and/or Weighed..............................1,036-1,039
Grain Inspection................................................. 1,063
International Monitoring Program............................1,048-1,049
IT Environment................................................... 1,053
IT Security.................................................1,053-1,054
Johnson Amendment................................................   524
Licensing Fees...................................................   537
Livestock Slaughter.........................................1,043-1,044
Live Weight Purchases.......................................1,056-1,057
Measures of Carcass Quality.................................1,058-1,059
Packers & Stockyards Act v. Perishable Agricultural Commodities 
  Act.......................................................1,061-1,062
Pesticide Data Program........................................... 1,048
Poultry Compliance Complaints.................................... 1,041
Poultry Industry Complaints.....................................553-555
Proposed Legislation............................................. 1,059
Proposed Regulation--Feed Weighing............................... 1,050
Questions Submitted for the Record:
    Chairman Bonilla............................................. 1,035
    Ms. Kaptur................................................... 1,060
Rapid Response Teams........................................1,051-1,052
Rapid Test Performance Evaluation Program...................1,062-1,063
Select Elements in Grains........................................ 1,047
Slaughters/Processors Subject to the P & S Act..............1,044-1,045
Unified Data Warehouse........................................... 1,053
Unrecovered Losses............................................... 1,047
User Fees........................................................ 1,066
Violation Cases--Grain........................................... 1,048
Violation Report Calls........................................... 1,041
Web Server Farm.................................................. 1,052

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