[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 1
                        DEPARTMENT OF AGRICULTURE
                                                                   Page
 Secretary of Agriculture.........................................    1
 Departmental Administration......................................  303
 Office of the Chief Financial Officer............................  449
 Office of the Chief Information Officer..........................  617
 Office of the General Counsel....................................  797
 Office of Communications.........................................  907
 Office of Chief Economist........................................  935
 National Appeals Division........................................  965
 Office of Budget and Program Analysis............................  979
     Revised Project Statements...................................  992
     GSA Rent Cost................................................ 1019
 General Provisions............................................... 1027
 Office of Inspector General...................................... 1055
                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 79-870                     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 13, 2002.
                              ----------                              


                       DEPARTMENT OF AGRICULTURE

                               WITNESSES

ANN M. VENEMAN, SECRETARY
JAMES R. MOSELEY, DEPUTY SECRETARY
KEITH COLLINS, CHIEF ECONOMIST
STEPHEN B. DEWHURST, BUDGET OFFICER

                       Introduction of Witnesses

    Mr. Bonilla. The subcommittee will come to order. This 
morning we are delighted to welcome Secretary Veneman, Deputy 
Secretary Jim Moseley, Chief Economist Keith Collins and our 
good friend, the long-suffering USDA Budget Officer Steve 
Dewhurst. We are delighted to be beginning our new year of 
appropriations today.
    Last year, as many of you recall, we started a little later 
with our hearings. At the time the Secretary was getting her 
feet planted at USDA, and we had her come in at the end of the 
hearing cycle. This year not only is she almost getting her 
leadership team at the USDA complete, but we also have received 
the President's budget. There has been a lot of opportunity to 
go over it, and we will have a lot of questions about that 
today.
    If we recall last year as well, the biggest problem that we 
had facing us at the time was foot and mouth disease and the 
great concerns we had about it affecting American producers and 
American livestock. Obviously things have changed and I know 
that the priorities at USDA have also changed. We are anxious 
to hear about those changes and what plans are for the coming 
year.
    Before we take testimony this morning, though, I would like 
to yield to my friend Ms. Kaptur to see if she has any opening 
remarks.
    Ms. Kaptur. Thank you, Mr. Chairman, very much as we kick 
off these hearings for the new fiscal year of 2003, and we want 
to welcome the Secretary. This is, I think, your second 
official appearance before our committee, and we have been very 
impressed with the work that you are doing in taking the reins 
at the U.S. Department of Agriculture and look forward to your 
testimony this morning. Thank you, everyone, the Chief 
Economist and Deputy Secretary and obviously Steve Dewhurst 
also, for coming this morning, and we are very anxious to get 
this year rolling.
    Thank you, Mr. Chairman.
    Mr. Bonilla. I have just been told that there is a ``Close 
Up'' class here from Seaside, California, near the home of the 
Secretary's sister.
    Secretary Veneman. And I also sit on the board of the Close 
Up Foundation.
    Mr. Bonilla. Very good. If the class members will raise 
their hands, we will acknowledge their presence here today. 
Welcome. We are glad to have you here this morning.

                            Opening Remarks

    Madam Secretary, I would like to take a moment before we 
take testimony just to acknowledge the work of this 
subcommittee last year. Last year was my first opportunity to 
chair this subcommittee. I am very proud of the cooperation 
that we received from both sides of the aisle in producing a 
bill that was supported by a record number of votes in the 
House of Representatives, and subsequent to that in conference. 
Our bill received an incredibly high percentage of votes as we 
moved toward final passage. I am very grateful for all of us 
working together. We had some difficult issues that we had to 
deal with as we moved forward and I am very proud of the work 
that the subcommittee did last year. We look forward to another 
good year in spite of the challenges that we have facing us 
now.
    Without further ado, Madam Secretary, we would be delighted 
to hear your remarks this morning. We have received your 
statement and reviewed it, and at this time you may proceed.

                       Statement of the Secretary

    Secretary Veneman. Thank you, Mr. Chairman. I appreciate 
the opportunity to be here with you and Ms. Kaptur, the ranking 
member, and all the other members of the committee, and I 
certainly appreciate the good working relationship that we have 
had with all of you on the committee.
    It is an honor for me to appear before you to discuss our 
2003 budget for the Department of Agriculture. I was planning 
to introduce my team, but you have already done that for me, so 
thank you, and we appreciate all of the work that they have 
each done on the budget, because it has been substantial.
    I have just returned this morning from traveling the 
country again. In the last 2 weeks, I think I have been to 
Georgia, Texas twice, Ohio, Colorado, Utah, California 
Louisiana, and Missouri. We have been out talking with farmers 
and ranchers about farm bill implementation and have had an 
opportunity to discuss some of the issues that are on people's 
minds.
    The budget this year is consistent with the policy book 
that we put out in September called Food and Agriculture 
Policy: Taking Stock for the New Century. I think you all have 
probably seen this book. It is kind of a blueprint that we are 
using as we go forward with our policies at USDA.
    Our budget also addresses the Nation's new priorities in 
light of September 11th and in a fiscally responsible manner. 
We are regaining fiscal stability, and it requires recognizing 
our priorities and making difficult funding decisions, and that 
is what we have tried to do in looking at our 2003 budget 
proposals.
    Let me tell you very quickly as an overview what this 
budget does. It funds key priorities for USDA. It protects 
additional Farm Program spending at $73.5 billion over 10 
years, supporting the House and Senate budget resolutions 
passed last year. It strengthens homeland security and provides 
protections from pest and animal diseases, food safety and 
research. It expands trade and provides tools to producers for 
international trade. It provides a record level of funding for 
the nutrition safety net for families who need assistance. It 
promotes good conservation and environmental stewardship. It 
helps rural communities, and it expands initiatives to make 
sure that we can make government work better.
    Let me just quickly review some of the numbers in our 
budget. The 2003 budget calls for $74.4 billion in spending, 
which is an increase of $11.1 billion over the fiscal year 2002 
budget submitted by the President last year. It is slightly 
below the 2002 enacted level, but again the 2002 enacted level 
takes into account things like emergency forest fires. It takes 
into account our supplemental appropriations, that we got for 
homeland security and a number of other additions above and 
beyond what our submitted 2002 budget was.


                         FARM BILL LEGISLATION


    As to the priorities of the budget, I want to detail a few 
of them as we go forward. First, this budget specifically 
provides an additional $73.5 billion over 10 years to meet our 
commitment to fund a generous farm bill based on sound policy. 
On Friday, the President was speaking in Colorado before the 
Cattlemen's Convention and reiterated his commitment to this 
spending and to his farm bill principles.
    We are going to continue to work with the Congress to 
produce a sound farm bill which the President can sign. The 
year to year numbers that are included will be adjusted to 
reflect what has passed in terms of a farm bill. We do have, as 
we have talked about many times, a concern about the Senate 
bill as it is currently pending because it would frontload 
substantial amounts of money, thereby undermining the baseline 
in the out years. We would much prefer the approach taken in 
the House bill in terms of evening out the amount of money over 
the 10-year period of time.
    Yesterday, I was in Kansas City meeting with Farm Service 
Agency employees and talked with them about our commitment to 
implement the farm bill as quickly as possible. It is never 
easy to implement a farm bill. It takes a tremendous amount of 
work on the part of our employees, but we are already working 
on preparations for implementation of the bill based upon some 
of the things we know are included in both the Senate and House 
versions. Our employees are hard at work to make sure that we 
are as prepared as possible when we do get a farm bill.


                             INFRASTRUCTURE


    Second, this budget protects agriculture and our food 
supply from potential threats, intentional or unintentional, 
and requests key increases for infrastructure programs that 
protect our food and agriculture; that is, pest and disease 
prevention and eradication, food safety and research.
    These are core programs that are critical to protecting 
agriculture for virtually all producers. We had, as you said, 
the scare of foot and mouth disease last year, which we were 
fortunately able to avoid in this country. We saw the 
infestation of Karnal bunt in some of our States last year, 
including your home State of Texas. Sometimes these programs 
are forgotten in terms of their importance, but in light of 
September 11th and the concerns about homeland security, we 
have placed a greater emphasis on these programs. We are 
requesting more than $146 million in new spending for food 
safety, pest and animal disease prevention and research.
    There is a record level of spending for the Food Safety and 
Inspection Service in order to support over 7,600 meat, poultry 
and egg product inspectors. More research is also proposed, 
aimed at protecting our food and agriculture system from animal 
and plant diseases, insects and other pests. We increased 
research in these areas to emphasize development of improved 
detection, identification, diagnostic and vaccination methods 
to identify and control threats to animal and plant 
agriculture.
    We also are looking at internal surveillance and analysis 
and beefing that up to assure that we can respond to problems 
if and when they could occur.
    We have an increase of $48 million requested for animal 
health monitoring to enhance our ability to quickly identify 
outbreaks that may occur, and an increase of $19 million is 
requested in the Agricultural Quarantine Inspection Program to 
continue to provide border inspection to protect agriculture 
and the food supply against pests and diseases. Staffing for 
the Agricultural Quarantine Inspection Program would be 
increased to nearly 4,000 staff years in fiscal year 2003 with 
this budget. This would be a 55 percent increase from staff 
levels that were in place at the beginning of fiscal year 2001.
    Our research, economics and education agencies in fiscal 
year 2003 would be funded at approximately $2.3 billion. This 
includes doubling the budget for the Department's Competitive 
National Research Initiative from $120 million in fiscal year 
2002 to $240 million in fiscal year 2003. That includes $9 
million for new uses in agricultural products and $6.5 million 
for global climate change.
    Just last month the President approved an additional $328 
million in one-time spending as part of the Defense 
Supplemental Appropriations Act for homeland security 
activities at USDA. This includes $105 million for pest and 
disease exclusion, detection and monitoring, $80 million for 
upgrading USDA facilities and operational security, $87 million 
for laboratory upgrades, $40 million for research activities 
and $15 million for food safety protection. We are working now 
with our appropriate agencies and the President's Office of 
Homeland Security to plan and implement that spending.


                 FARM AND FOREIGN AGRICULTURAL SERVICES


    Third, this budget maintains an aggressive program level of 
over $6.4 billion in support of food and agricultural 
international trade. It increases funding by $50 million for 
trade programs and services that provide valuable tools for 
U.S. producers to gain access into these markets. There is a 
substantial increase proposed for P.L. 480, Title II in this 
budget. The Administration believes that the P.L. 480 program 
should be the primary vehicle for food aid overseas rather than 
relying on extensive use of Section 416(b). We continue to hope 
that the Congress will quickly approve Trade Promotion 
Authority for the President.


                       FOOD AND NUTRITION SERVICE


    Fourth, the budget provides a record $41 billion to provide 
a strong nutrition safety net for families who need assistance 
from the government through our Women, Infants and Children, or 
WIC Program, our Food Stamp and Child Nutrition Programs.
    The WIC program is an essential part of this food safety 
net. The President has strongly emphasized this program, and it 
was designed to protect a very vulnerable segment of the 
population; that is, low-income, nutritionally at-risk pregnant 
women, infants and children. This program has shown measurable 
results, particularly in terms of reductions in infant 
mortality.
    It is important to remember that 47 percent of children 
born in this country are born into WIC families. For fiscal 
year 2003, the Administration has included sufficient resources 
in this budget to support an average WIC participation of 7.8 
million people, up from 7.5 million recipients in fiscal year 
2002.
    Specifically for the Food Stamp Program, outlays are 
increased in the President's budget by over $1.4 billion to 
support an average participation of 20.6 million participants, 
up from 19.8 million participants in fiscal year 2002.
    The budget also requests a $2 billion contingency reserve 
should enrollment exceed the estimates. The budget includes a 
number of legislative proposals to improve the Food Stamp 
Program. Legislation is proposed to restore food stamp 
eligibility for legal immigrants who have been in the United 
States for at least 5 years, to allow ownership of one vehicle 
per work-able household member and other provisions to simplify 
program rules and improve program accountability.


                         CONSERVATION PROGRAMS


    Fifth, this budget promotes good conservation and 
environmental stewardship programs to help our environment, 
farmers and ranchers. As the President often says, farmers and 
ranchers are the best stewards of the land, and we want to make 
sure that we have the tools to assist them in doing just that.
    The budget provides $6.1 billion in spending for the 
natural resources and environment agencies. It includes a $50 
million increase for conservation operations and technical 
assistance. The budget for the Natural Resources Conservation 
Service, or NRCS, like that for the farm programs, is highly 
dependent upon the outcome of the farm bill. The Administration 
supports a strong conservation component of the farm bill to 
enhance conservation programs for working lands, such as the 
Conservation Reserve Enhancement Program, the Environmental 
Quality Incentives Program and other such programs that assist 
our farmers.
    The budget includes resources necessary to continue the 
services USDA provides to farmers and landowners, and continues 
to emphasize key areas, such as nutrient management plants for 
animal feeding operations and the need to meet strong demand 
for environmental assistance.


                           RURAL DEVELOPMENT


    Sixth, this budget contains $11.6 billion for rural 
development programs, roughly the same level as was spent in 
fiscal year 2001. The budget takes a close look at programs and 
targets resources to high priority areas. We have worked hard 
in this budget to provide funding for the most urgent needs of 
rural America, including home ownership, water and waste 
systems and support for business development and jobs in rural 
areas.
    We have recommended some reviews and reforms in areas of 
rural development, including rural rental housing and the rural 
telephone bank, to ensure that they are producing the intended 
results.


                        DEPARTMENTAL MANAGEMENT


    Finally, this budget looks closely at the programs and 
services that the Department manages. It contains several 
critical management initiatives that will better integrate USDA 
programs and services and better prepare our employees for the 
21st century workplace. Most importantly, our initiatives will 
help us serve our customers more expeditiously and efficiently.
    In the Department of Agriculture's budget, you will find 
resources and commitments in various places dedicated to the 
achievement of this management agenda. For example, we want to 
improve customer service in our field delivery systems by 
taking another look at our office structure, our organization 
of administrative support functions and how we manage a number 
of important areas, such as our credit portfolio.
    Overall, there is a great deal of attention in this budget 
to investments in technology. We cannot expect our employees to 
improve customer service or achieve our other management 
objectives unless they are provided with adequate modern 
technology. We want to make e-Government a reality for our 
customers.
    Mr. Chairman, that completes my overview of some of the key 
points in this budget. It is, we believe, a responsible budget. 
It funds key priorities and programs at USDA. Again, it 
supports the Congressional budget resolution of $73.5 billion 
for Farm Program spending over the next 10 years. It 
strengthens homeland security, pest and disease eradication, 
food safety programs and the research that supports them. It 
expands trade, providing tools for our producers to export. It 
provides a record level of nutrition safety net for families 
who need assistance. It promotes good conservation and 
environmental stewardship. It helps rural communities, and it 
expands initiatives to make sure we make government work 
better.
    Thank you very much. I appreciate the opportunity to be 
here, and we will be happy to answer questions from you and the 
members of the committee.
    [The information follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Bonilla. Thank you, Madam Secretary. You are being a 
real trooper today because I know you have been on the road for 
several days. You came here directly to testify.
    We have a very controversial bill on the floor today that 
was not scheduled at the time we scheduled this hearing, so we 
will be interrupted by votes on perhaps a couple of occasions, 
but we will get through this and you will sleep well tonight, I 
am sure.


                         CONGRESSIONAL EARMARKS


    I would like to comment first of all, Madam Secretary, on 
Congressional earmarks. The budget request includes a proposal 
to eliminate funding for over 400 items that are referred to as 
earmarks. Madam Secretary, this is a budget proposal that we 
see year after year and I am pretty sure that this is not your 
idea, but you need to come before us and defend it nonetheless.
    My view and our committee's view is that each of these 
projects address a specific problem that will contribute to a 
useful solution, because there is no one that knows what the 
needs are in every particular part of the country other than 
the members of the House and Senate. It rankles us somewhat 
that there seems to be an assumption in some circles that 
anything proposed in the budget request is pure and true and 
honest and unblemished, but that any Congressional action to 
alter the budget request is totally without merit. You may have 
seen this idea discussed in the opinion pages of various 
newspapers recently.
    To paraphrase an anonymous writer, don't pick a fight with 
one who buys ink by the barrel. We understand our subcommittee 
does not sell newspapers, but we do write one appropriations 
bill every year. The administration proposes and Congress 
disposes, and that is the way the system is designed in this 
great country of ours. We are not going to change it and I 
doubt that we are going to change our mind about directing 
resources to work that we find important.
    So, Madam Secretary, I hope that you understand where we 
are coming from, and if you have any comments on that at this 
time, we would love to hear them.
    Secretary Veneman. Well, Mr. Chairman, I do understand your 
concerns, and certainly understand that every year there are a 
number of Congressional earmarks and that virtually every year, 
regardless of the administration, they are not put in the 
President's budget. I think that has been a relatively 
consistent package with Agriculture, although I do understand 
the concerns of the Congress.
    In the case of Agriculture, many of these Congressional 
earmarks are in the form of research projects, and we have, as 
I indicated in my opening statement, taken the position that we 
should have competitive grants for as much research as possible 
and in fact double the amount of funding proposed for the NRI 
in order to do that. We think that a number of the kinds of 
things that the Congress proposes can be covered within those 
competitive grants, and while I know that there is a difference 
of opinion, and I do appreciate your concern about this, I hope 
that I have somewhat explained some of the philosophical 
differences we have on this.
    Mr. Bonilla. I think there seems to be at least an 
understanding of our position on this. Every Member has to go 
back home and prove themselves or show that they are concerned 
about local problems. Sometimes those concerns may not be on 
the radar screen at USDA or otherwise in Washington. So I guess 
we will work through it as we have in the past.


                        SCOREKEEPING ADJUSTMENTS


    I would like to comment briefly now on scorekeeping 
adjustments. The budget request for the Department is always 
complicated and detailed. We have a lot of items that we agree 
upon and some differences. Within the total budget request for 
fiscal year 2003 there are three items that I think will be a 
big problem for us this year. These items propose language that 
would, number one, limit your access to CCC funds for emergency 
pest and disease programs. The second one is, it would limit 
the underwriting gain in the Crop Insurance Program and, number 
three, would prohibit any spending for mandatory research 
programs.
    In total, these three items create a $722 million hole that 
this subcommittee will have to fill. It is going to be a 
difficult challenge, Madam Secretary, but I am sure that you 
are aware that we will handle it on our end.
    Secretary Veneman. I do, Mr. Chairman, and I understand 
your concern about this as well. Let me first make a comment 
about the emergency pest and disease funding.
    We have included in the budget pest and disease funding for 
ongoing programs. This budget does not undermine, we don't 
believe, the Department's ability to address new emergencies as 
they emerge during the fiscal year, so that if there is a new 
outbreak of some disease we can access emergency funds. What 
this budget does is fund those ongoing programs such as, for 
example, citrus canker, which we have had in Florida, or 
Pierce's disease, which we have had in our grape crops, since 
they are ongoing programs, rather than fund them out of 
emergency funds. It does not undermine our ability to use the 
emergency funds.
    The underwriting gains were put in the budget as a result 
of the crop insurance reform. There have been some large 
benefits that have resulted because of the way that the crop 
insurance benefits to the companies now accrue, and so some 
adjustment was made to cap that limit at 12.5 percent.
    The mandatory research issue is one that certainly I share 
your concern with. However, my understanding is, and I will 
look to Mr. Dewhurst to explain this in more detail if need be, 
is that because this program was not funded by the Congress 
last year and that we had discretionary savings from it, we 
would have had to use some discretionary money to fund the 
mandatory program, which created some difficulty in terms of 
finding that money.
    Did I explain that right?
    Mr. Dewhurst. Right.
    Secretary Veneman. That is my understanding. I believe that 
we should try to find some mandatory monies and some ongoing 
monies to fund research, because I think it is so important to 
agriculture, to some of the emerging issues, whether it is pest 
and disease, food safety or environmental challenges. We need 
ongoing sources of research funding and mandatory research 
funding is something that clearly ought to be looked at. 
Because of this funding issue last year it made it more 
difficult to replace it in this year's budget.
    Mr. Bonilla. Points are well taken, however, we will still 
be in the hole with the money and we are going to have to 
figure that out as we work this year.
    We will be adhering to the 5-minute rule once again this 
year and we ask members to please try to cooperate. We will go 
as many rounds as we can.
    Ms. Kaptur.

                       FY 2003 BUDGET SUBMISSION

    Ms. Kaptur. Thank you, Mr. Chairman. Madam Secretary, as I 
read the budget you have submitted to us, you talked about 
major increases in the opening statement. From the way I look 
at these numbers, overall you are talking about total funding 
for programs within our jurisdiction, total funding of about 75 
billion, 716 million, which is only an increase of $26 million 
overall compared to the prior enacted level last year, which is 
less than one-tenth of 1 percent increase, and of that amount, 
$18.204 billion is for discretionary programs, which obviously 
is what we struggle with here, which is an increase of about 
$632 million, or 4 percent, in the discretionary account. So I 
guess I just want to make the numbers a little more realistic 
in terms of what this subcommittee deals with as opposed to the 
President's total budget because I think it is much tighter 
than it might appear at first blush from your opening 
statement.

                      PEST AND DISEASE ERADICATION

    And I wanted to move immediately to this account that deals 
with eradication under APHIS. In your testimony, you say that 
the 2003 budget request, $162 million in appropriations to 
continue funding for those programs.
    Could you detail for me, is that an increase or is that a 
continuation of last year's level, because I guess the word I 
am concerned about in your testimony, when you talk about 
certain difficulties we are having, such as Asian longhorn 
beetle, citrus canker, Mediterranean fruit fly, et cetera, can 
no longer be considered ``emergencies''. We need to have 
ongoing control, and then you say that the administration is 
concerned about the rising Federal costs, which this Member is 
as well, of emergency pest and disease control and expects to 
see public comment on flexible criteria to share the financial 
burden with cooperators who receive benefits from program 
activities. And the word I am concerned about is ``receive'' 
benefits, as opposed to those who incur costs, because for 
Asian longhorn beetle those costs are coming from beetles that 
came from China. In our trade agreements we don't exact any 
payment of those costs from those causing the problem.
    So the way I read your testimony, the costs of this are 
being shifted to our producers, and we aren't recovering from 
the international realm the true costs from those responsible 
for this, and I guess I wanted to just hear your thinking from 
a policy level, first on the funding for this next fiscal year 
because it is a rising share, I believe, of expenditures, as I 
look at the discretionary accounts. And then what you are 
thinking is these costs are going to be shifted to our 
producers. Sure, they might receive the benefits, but they 
didn't cause the problem. So I have a vested interest in who is 
going to pay the cost of this.
    If you could address those two issues, whether the level of 
funding as a percent of discretionary is an increase or not, 
and then what is your thinking about putting the burden of 
those costs on those who actually cause the problems through 
our trade agreements as opposed to our farmers here who are the 
victims? They are not the beneficiaries. They are the victims 
of what has happened.
    Secretary Veneman. Okay. Why don't I let Mr. Dewhurst 
review the numbers first and make a couple of comments, and 
then I will follow up a bit on the issue of cost sharing.
    Mr. Dewhurst. The 2003 budget requests $162 million in 
appropriations to continue funding several eradication programs 
that had been started with funds transferred from CCC.
    Ms. Kaptur. I am sorry. She told me, I used some wrong 
numbers, but I don't understand what she is saying to me.

                      APHIS/CCC EMERGENCY FUNDING

    Mr. Dewhurst. It is interesting to me, that if you look at 
the use over time of the Secretary's emergency authority to 
fight pest and disease outbreaks on an emergency basis, during 
most of the 1990s through 1998, we averaged about two of these 
emergencies a year, and the Federal cost involved in those 
emergencies averaged something like $25 million.
    Ms. Kaptur. $25 million through the decade of the 1990s?
    Mr. Dewhurst. Through 1998. In 1999, we had more 
emergencies than we ever had before, and we spent $145 million 
in emergency funds fighting those outbreaks. By the year 2000, 
the numbers expanded, and we spent $217 million fighting 
emergency outbreaks. By the year 2001, we had further increased 
the numbers of diseases, and we were carrying 16 emergencies on 
the books, we and the costs were over $325 million.
    These are very difficult things to estimate. At the moment 
in fiscal year 2002 we know about emergencies which we believe 
will cost approximately $151 million. Now, I am not making an 
estimate of things we will have to declare in the future. I am 
just saying the things we now have on the books are costing 
about $151 million this year.
    The President's budget for the Animal and Plant Health 
Inspection Service actually does include an increase which 
totals $162 million.
    Ms. Kaptur. So that is an increase over last year?
    Mr. Dewhurst. Yes, and I will explain that, but let me just 
say for a moment that the increase is the carry-forward cost of 
the emergencies we have already declared. The Administration 
believes that when you have a problem that is a multi-year 
problem you finance those problems through appropriated funds.
    The APHIS budget that you see before you has a total 
increase of $210 million. There are essentially four components 
to that budget. There is an increase of $162 million for the 
carry-forward costs of these emergencies. There is a little 
over $90 million in real program increases for various things 
that the Secretary has talked about. There is about $12 million 
for things like pay costs and other mandatory expenses. There 
are some reductions, about $58 million. The big decrease is the 
boll weevil program. There is also an increase of $162 million 
for ongoing emergencies. It is real. There is a policy debate 
about whether that money should be there.

              COST-SHARE FOR PEST AND DISEASE ERADICATION

    Secretary Veneman. As to the cost sharing, this is not 
necessarily cost sharing with producers. We have done many of 
our programs as cost shares with States. Having come from 
California, where we have run several medfly programs, those 
are partnership programs between the State of California and 
the Federal Government. Likewise with citrus canker, we have 
done it in partnership with States, as with many of our other 
programs. Pierce's disease we have done it in partnership with 
the State. So when we talk about cost share and going out to 
look for public comment, we are primarily talking about State 
cost share here rather than producers' cost share.
    Now, we haven't as far as I know looked at the issue of 
international cost share. I don't know how easy that would be 
to do. We are doing everything we can to protect our borders 
against unwanted pests and diseases. We have increased our 
border inspections. We are constantly looking for new ways of 
detection so that we don't get these diseases. We know that 
these are serious issues to agriculture so we continue to put a 
lot of focus on them.
    Ms. Kaptur. Mr. Chairman, I know that my time is expired, 
but I would just ask the Secretary, and perhaps it is in the 
backup volume here. I would like to have the information that 
Mr. Dewhurst summarized for us, kind of the historical 
development of these sets of accounts.
    Mr. Dewhurst. Yes, ma'am.
    Ms. Kaptur. By various diseases and insects, and I know for 
sure this Asian longhorn beetle, we haven't seen the end of 
this thing, and I am so angry about this. And for the State of 
Ohio or the State of New York or the State of Illinois to be 
the cost sharer in this without going after those who imported 
and those who are involved in shipment, I think is absolutely 
backwards. We are putting the costs of this on our own people, 
and we are involved in all of these international trade forums, 
World Trade Organization, et cetera, et cetera. We better find 
a way to put the costs of this on those who really caused it, 
and for sure we know that critter, the Asian longhorn beetle, 
came from China.
    So we have got to find a way to put the burden on those who 
actually caused the problem. I would just ask, Madam Secretary, 
if you could provide for the record some additional thoughts on 
this, and along with the additional supplementary information I 
have asked for so that we can really take a look at these 
particular set of accounts, and I thank you. Thanks, Mr. 
Chairman.
    [The information follows:]

    I understand your concerns regarding the costs of 
eradicating a pest brought into the US, and I am committed to 
using cost effective solutions. With the extent of 
globalization today, we are experiencing significantly greater 
travel and commerce coming across the borders. Our budget 
requests an increase of $14 million for the taxpayer supported 
Agricultural Inspection activities, an increase of $49 million 
for plant and animal health monitoring, and an increase of $12 
million for diagnostic and technical services to strengthen the 
science base for decisionmaking. We have studied this issue in 
the past and determined that the best defense is to backstop 
our Agricultural Quarantine Inspection with an effective early 
detection capability.
    Additionally, it would prove to be extremely difficult to 
assess this cost and share that burden with foreign countries 
for a host of reasons. Primarily, it is extremely difficult to 
identify the country of origin for a pest or disease. Our best 
science including DNA testing cannot pin point where the pest 
is originating with total certainty. In some cases, the United 
States, through military conveyances, may have brought the pest 
into the country. Also, if an exporting country is following 
our protocols, it would be inappropriate to then assert that 
the country is at fault.
    It is possible that foreign countries could retaliate in 
various ways including reducing trade and looking for ways to 
charge us for allegedly exporting our pests and diseases to 
their countries. Additionally, if it were possible to identify 
without doubt the pest origin, there is the issue of legal 
jurisdiction over a foreign country; it would be difficult to 
hold them accountable in these instances.

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



    Mr. Bonilla. Thank you, Ms. Kaptur. In order to try to 
continue the hearing and use time as efficiently as we can, Mr. 
Walsh will return any moment and ask his questions. The rest of 
us are going to run and vote and come right back. Is that okay 
with you?
    Secretary Veneman. Fine with me.
    [Recess.]

                         STATEMENT BY MR. WALSH

    Mr. Walsh [presiding]. The subcommittee will come to order. 
Someone said there are two additional votes. Apparently we are 
going to be interrupted again very soon, so let me try to be 
brief.
    First of all, thank you for your leadership at USDA, and 
thank you to all of your employees for the great job that they 
are doing.
    You mentioned early in your testimony the issue of foot and 
mouth disease. There is also, as you know, in Europe, this 
issue of mad cow disease. I think your folks have done a 
remarkable job in keeping those two diseases out of our country 
and we want to make sure that you have the resources to 
continue that fight. As the world gets smaller, we become more 
and more susceptible to those problems.
    So in that vein, in the 2003 budget you are asking for a 
significant increase in FSIS and APHIS spending, putting them 
under the heading of increasing USDA homeland security efforts. 
I think we are all in agreement about the need to increase 
resources for FSIS and APHIS, but I am concerned that there may 
be shortcomings in certain areas of our food safety system.

                              FOOD SAFETY

    Can you comment on where the U.S. is vulnerable in our food 
safety system in HACCP implementation, and do individual States 
have enough resources and updated facilities to do their food 
safety work?
    Secretary Veneman. One of the things that we did in the 
Food and Agriculture Policy Book, was to include a chapter that 
discusses the issues of animal and plant health inspection, 
pest and disease prevention and eradication, food safety and 
the research that supports that sort of underlying 
infrastructure. The Department's infrastructure supports all of 
our farmers and ranchers, whether it is foot and mouth disease, 
Karnal bunt, citrus canker, medflies or food safety issues.
    Now, some of these are food safety issues. Some of them 
aren't. As you mentioned, we started out early last year 
dealing with the threat of foot and mouth disease, because we 
saw what was going on in Europe. This does not happen to be a 
human food safety issue. We then also have been concerned for a 
number of years about mad cow disease. We released in November 
our Harvard Risk Assessment, which was a 3-year study that 
showed that the likelihood of us getting mad cow disease was 
relatively slim and, even if we were to get it, the steps that 
we had taken were the correct ones to prevent it from 
spreading.
    We then had the whole issue of September 11th, where we 
began to look at these issues, not just from the standpoint of 
unintentional introduction of pests and diseases into our 
country, but also from the standpoint of intentional 
introduction. As I indicated, we have had substantial increases 
in our budget. Last year when we had the threat of foot and 
mouth disease, we redeployed some resources, and beefed up what 
we were doing at the borders. We worked with the airlines. We 
then had the defense supplemental appropriation, which I talked 
about, which has given us more money for the homeland security 
side of it. These issues often overlap.
    I have been asked many times what I believe are some of the 
areas of greatest vulnerability in terms of our food supply and 
intentional threats, and I continue to believe that it is 
things like foot and mouth disease which spreads quickly and is 
easily introduced. That could be the biggest threat.
    It is not a human health threat, but it is certainly a huge 
threat to our agriculture productivity, and so that tends to be 
an area where I am concerned. We have, and I think we need to 
continue to reiterate that we have the world's safest food 
supply in this country. We also have a system that has been 
able to quickly find food safety issues and threats and remove 
products from the marketplace. We do that through FSIS in our 
meat inspection. FDA does it on other products, and I think our 
ability to continue to work on these issues and to continue to 
protect the food supply is very good.

                       HOMELAND SECURITY COUNCIL

    In addition, we have put together a Homeland Security 
Council, looking at the whole food chain to make sure that we 
are working with industry to find all of the vulnerabilities, 
all of the critical areas from production to processing to 
transportation to retailing. We are working with trade 
associations, with other partners in government, and 
strengthening our relationships with the States, which we 
really began doing with the foot and mouth scare. I brought in 
our State vet from California on a detail for about 2 months to 
coordinate that whole effort. Of all the issues that we have 
had to take on with new proactivity since being in office, it 
has been this whole issue of what we call the infrastructure 
that has demanded the most attention. Much of that area is now 
under the umbrella of homeland security, which has been headed 
up very ably by Jim Moseley, our Deputy Secretary.

                           VETERINARY SCIENCE

    Mr. Walsh. I just visited recently with the Commissioner of 
Agriculture for New York, who I believe is a Cornell grad. We 
talked a little about the aspect of veterinary science and the 
interplay between the Federal and State governments. I was 
surprised at the very small numbers of veterinarians that the 
State and the Federal Government have available to them to deal 
with issues like foot and mouth disease. If you don't have a 
good strong ag school in every State with the resources to do 
these sort of investigations, what sort of planning is underway 
to provide support to fight these battles?

                         FOOT AND MOUTH DISEASE

    Secretary Veneman. Well, let me make a couple of comments 
on that. One of the things about the unfortunate outbreak of 
foot and mouth disease that happened in the UK is that we had 
over 300 veterinarians and scientists from the United States go 
over to the UK for periods of time and help with the control 
and eradication of foot and mouth disease in the UK. Now, that 
certainly helped the UK and the Ambassador has been in and 
thanked me personally for our commitment to helping them, but 
on the other hand it has helped us tremendously because our 
people have learned so much. Some of the first group to return 
from the U.K. came to my office to say they have never taken a 
training course since being out of veterinary school that gave 
them this much training and exposure.
    That is important because our veterinarians are helping 
farmers and ranchers every day and they are going to be the 
first line of defense. So the fact that we now have so many 
people throughout the U.S. who have been exposed personally or 
had the opportunity to talk with people who have been working 
with the foot and mouth disease is certainly helpful.
    We have also been talking about where we can use regional 
laboratories and ag schools to buttress and be partners with us 
in the fight against these diseases and the development of 
diagnostic capabilities. We need to have some redundancy in our 
system, and we need to have some regionalization. One of the 
interesting things about Cornell is that our chief veterinarian 
just went to run the laboratory at Cornell. Dr. Torres and I 
had an exit visit in which we were talking about how we might 
develop more of these research partnerships. He is going to be 
a tremendous asset there in that region, because he was the 
primary veterinarian at USDA. Dr. Torres along with some of the 
State veterinarians have been working with us, to help us with 
the foot and mouth initial controls.
    These are the people that are going to help us look at new 
ways to prepare ourselves for the fight against pest and animal 
disease. Having these people in the States that really 
understand the Federal Government as well is a necessity. We 
are going to utilize these folks to help us look at new ways of 
doing things and utilize the resources that we have around the 
country, including laboratories that have partnerships between 
the States and the universities. To the extent that we can do 
so in the Federal Government, we intend to utilize those 
excellent resources and use them to supplement the laboratory 
system we have. I think that is very valuable.
    Mr. Walsh. The Chairman is gone. While the cat is away, the 
mice will play. I am not going to pay any attention to the 5-
minute rule until the bell is off again. I would hate to have 
you waste your time.
    Secretary Veneman. I don't want to waste my time nor yours.

                      FARMLAND PROTECTION PROGRAM

    Mr. Walsh. One of the most important programs that you 
oversee in your agency is Natural Resources Conservation 
Service. In my part of the country and I am sure in other parts 
of the country where you have pressure on the land by urban and 
suburban growth the Farmland Protection Program has become 
very, very popular. I live in Syracuse, Onondaga County, and 
between where I live and the City of Rochester, just south of 
us, is a region known as the Finger Lakes. It is a magnificent 
region. The viticulture and the research that we have done has 
dramatically helped the New York State wine industry.
    It is expanding dramatically. There are people from all 
over the world now investing in those lands, and they are very 
inexpensive compared to the soil land in California. But we 
would like to try to keep the character of that region 
agricultural, and there is tremendous pressure on the land from 
Syracuse and Rochester and from the south to spread and 
subdivide and build suburbs all through those beautiful 
regions. We don't want that to happen. At least some of us 
don't want that to happen.
    I am sure this is reported all around the country, 
especially around large urban areas, like Atlanta. In 
California I know that San Francisco is growing right out into 
Modesto. So this is a very valuable tool, farmland protection, 
where we help the States to buy the developing rights for these 
farms to keep farmers on the land.
    I notice in this budget there is really no increase in 
farmland protection funds. In the farm bill that the House has 
passed, there is a $50 million annual authorization, and in the 
Senate bill there is a dramatically larger authorization for 
this program. I wonder what your thoughts are on why this 
wasn't increased. I have to say, we always end up talking about 
what we disagree on. Most of what you have done I agree is 
important and has the right priorities, but this is something 
that I think we need to talk about a little bit.
    Secretary Veneman. That is one of the programs that is 
going to be addressed in the farm bill. This is an issue that 
will depend upon the outcome of the farm bill and how that 
money will ultimately get allocated, the $73.5 billion which is 
budgeted for the overall farm bill.
    Now, let me say a few things. As you said, this is an issue 
that is particularly of growing interest on the coast, 
California, Oregon, Washington, and then along the eastern 
seaboard as well, where we see more and more interest in 
preserving farmland through buying out development rights, for 
example. We have certainly had a number of programs that we 
have worked with in California. Some of them are not just the 
Farmland Protection Programs that are financed through the 
Federal appropriations, but there has been a growing number of 
land trusts that have participated in these programs. In 
California we even have our cattlemen who have developed their 
own land trusts for grazing lands, which is quite interesting.
     I actually was involved with an organization that was 
doing a number of these buyouts of land development rights, and 
one of the things that people are looking at in California is 
how do you strategically use the kind of monies that you have 
so that you are buying up critical land around urban areas and 
creating buffer-type zones. I think that is a good strategic 
way to use these kinds of resources.
    When I went to Chicago some of the farm areas just outside 
Chicago, expressed a similar interest in these kinds of 
programs. So I think this is going to be an issue that 
continues to grow in interest. Your description of what is 
happening in the Finger Lakes, of course, is not dissimilar 
with what is happening in California and all along the coast.
    I am sorry Sam Farr isn't here because he is seeing the 
same thing in much of Monterey County where we have seen a lot 
of new lands with new technology, whether it is drip 
irrigation, or the ability to sample soils for the specific 
kinds of grades. There are a lot of vineyard owners that are 
assisted by having the development rights bought out as they 
also develop the land in the vineyard. So I think these are 
issues that are going to continue to be of interest. I think we 
need to leverage the resources we put into them through the 
Federal Government with those that are being put in at the 
local and State levels so that we can make the most strategic 
decisions about where these resources go.

                         FARM BILL LEGISLATION

    Mr. Walsh [presiding]. I appreciate your obvious interest 
and knowledge in this area. It is of critical importance in 
those areas where there is tremendous pressure on development. 
What if we don't have a farm bill this year? What happens to 
this title?
    Mr. Dewhurst. Well, we have several conservation programs 
that were funded through the farm bill in 1996, which include 
the conservation reserve, wetlands reserve, and the farmland 
protection programs. All of those programs need 
reauthorization. So if we do not get a farm bill, it becomes a 
question of whether there is some other way to deal with those 
programs.
    Secretary Veneman. But the current farm bill does go 
through 2002; so even if the farm bill does not begin until the 
2003 crop year, we would have those programs, I assume, still 
in place.
    Mr. Dewhurst. Well, the way the 1996 Farm Bill was written, 
there are acreage limits or total funding caps on those 
programs, which we have hit. So we have some authority, but we 
don't have any money to fund that authority because we don't 
have a farm bill that provides the money. Clearly we would have 
a problem if we don't get a farm bill.
    Mr. Walsh. Even if they were authorized through 2002, we 
are talking about 2003 now, and so this is going to be an issue 
for appropriations, depending on what comes out of the farm 
bill. It is time to go vote, so we will ask you to wait 
patiently. Only two bells went off; so I suspect there is just 
one vote. The committee will briefly recess.
    [Recess.]
    Mr. Bonilla. Madam Secretary, by the way Mr. Combest says 
to give you a hug.
    Secretary Veneman. Okay. Are you giving it to me or is 
somebody else?
    Mr. Bonilla. I will probably have to give it to you later. 
I will recognize Ms. DeLauro.

                           WIC PARTICIPATION

    Ms. DeLauro. Thank you very much, Mr. Chairman, and Madam 
Secretary, for being here. I appreciate the opportunity to 
listen to you and have a chance to have a conversation. I want 
to talk about two areas and lay out some questions in the WIC 
area. If you would then get back to us on that, that would be 
terrific. I am delighted that the administration is proposing 
to cover 7.8 million people. I think folks on this committee 
know that the WIC program is a critically important program and 
it saves us money.
    Let me just ask my questions, and this is particularly with 
regard to this coming year and the potential of a shortfall in 
the WIC program. I will lay them out and you can get back to 
us. What information does USDA have concerning potential 
shortfalls in State fiscal year 2002 WIC funds? Are any States 
taking action to cope with this situation? Are they restricting 
access for certain categories of participants? If so, which 
ones? If it comes to WIC turning away qualified families in 
significant numbers, what is your view on requesting a 
supplemental? How does USDA plan to monitor on an ongoing basis 
whether the funds are sufficient to maintain WIC participation 
across the States?
    And let me just add, I wanted to know if we have your 
commitment that USDA will do everything possible to ensure that 
the States have the resources they need. I am asking these 
questions because you know the state of the economy for this 
year. We are still in a recession, and it is difficult times 
for people who are unemployed. So I am concerned about what 
happens for the rest of this year.

                         WIC FUNDING ALLOCATION

    How does USDA plan to use the discretion provided in the 
law to ensure that funds are distributed in a way that responds 
to different conditions in individual States, and what plans 
does USDA have to assess on an ongoing basis whether the 
allocation of funds across the States reflects each State's 
actual funding needs? So let me just leave those for you all to 
get back to inform us on.

                              FOOD SAFETY

    Let me move to a couple of food safety areas. This has to 
do with Supreme Beef, where I was disappointed with the Fifth 
Circuit Court of Appeals ruling that USDA could not close down 
Supreme Beef, even after USDA inspectors found the unhealthy 
levels of salmonella. This was on three separate occasions. I 
happen to believe that this decision undermines the authority 
of the USDA, and it isn't safe in terms of the protection of 
our families. So let me just ask again a series of questions in 
regard to this. Will the USDA continue to enforce the 
salmonella performance standard in slaughterhouses and poultry 
grinders?
    Is the agency committed to performance standards to verify 
that slaughter and processing plants are producing cleaner, 
safer products? Would the administration support legislation 
that would allow USDA to close down facilities that repeatedly 
fail to meet minimum food quality standards? And will you be 
asking the Department of Justice to appeal the Fifth Circuit 
ruling to the Supreme Court? Will you seek legislation 
overturning the decision? I just ask you those questions for 
right now.

                         SUPREME BEEF VS. USDA

    Secretary Veneman. Okay. I was a little confused about 
which questions were for the record. Let me just talk briefly 
about the Supreme Beef case and how we have reacted to it. I 
don't have a copy of the actual statement and press release we 
put out on it, but the Supreme Beef case did basically say that 
the USDA could not shut down plants based solely on the 
salmonella performance standard.
    USDA immediately came out and said that we are going to 
continue to test for salmonella, we are going to use it as an 
indicator of whether or not we need to return to a plant even 
though we can't close the plant immediately. Based on that, we 
are going to use it as an indicator to look at the plant and 
its entire HACCP plan. This does not undermine our ability to 
pull inspectors, thereby in effect, closing down plants if 
there is a food safety problem.
    We are going to continue to look at the entire plant, and 
at their HACCP plans. We will simply use the salmonella 
standard as an indicator to look further into the plant to 
determine whether or not there are problems. Now, I believe 
that the lawyers have made the decision that they are not going 
to appeal this particular case.

                         FOOD SAFETY STANDARDS

    We are looking at regulatory structures, and we have the 
National Academy of Sciences reviewing a whole array of 
indicators that may be used for performance standards. We have 
advisory committees involved in this. We are looking at 
possible areas of legislation that might be helpful. Our Under 
Secretary For Food Safety, Dr. Elsa Murano a microbiologist 
from Texas A&M, is extremely involved in these food safety 
issues.
    We are absolutely committed to doing everything we can to 
improve the Food safety systems. We will not hesitate to shut 
down plants if there are problems and we continue to do so, and 
even though we can't use the salmonella performance standard in 
and of itself to shut down plants. We are using it as an 
indicator to go into plants to see whether or not there are 
food safety problems within the plants that need to be 
addressed.
    Ms. DeLauro. We have three instances here. It would seem to 
me it ought to be reasonable enough to be able to do some 
things. I don't know how many more times we have to go in and 
find out that things are not happening. Looking at mandatory 
recall authority enforcement measures to be able to improve 
food safety in this country, can we just rely on voluntary 
efforts. It doesn't seem to me in some instances that we can, 
and I believe that if we have the judicious use of the 
authority for the agency to be able to go to those plants who 
were, over and over again, being egregious and not abiding by 
food safety regulations, American families would be safer. That 
red dot says my time is up; isn't that right, Mr. Chairman?
    Mr. Bonilla. Yes.
    Ms. DeLauro. Thank you very much. This is not an affront. 
We have the Secretary of Labor HHS; so I am going to run over 
to that and hopefully come back. Thank you.
    Secretary Veneman. Thank you.
    Mr. Bonilla. Thank you, Ms. DeLauro.
    Mr. Latham.

               NATIONAL ANIMAL DISEASE CENTER, AMES, IOWA

    Mr. Latham. Thank you, Mr. Chairman. And welcome Madam 
Secretary. It is good to see you. One concern I have in the 
budget is the National Animal Disease Center at Ames, and the 
budget outlines several priorities for the administration's 
priorities relating to homeland security, and I think in your 
testimony, you say you are supportive of the modernization 
program. And I would like to hear your thoughts as to where you 
think we should go this year as far as the appropriations and 
what you foresee as maybe accelerating the facilities there for 
future threats that we have whether disease, anthrax, those 
types of things?
    Secretary Veneman. Well, as you indicate, Ames is a very 
important facility for USDA, particularly in light of some of 
the things we have dealt with over the past year. It has a key 
role in homeland security issues. Earlier on this year, I hate 
to bring up the issue, but we had to test sheep out there for a 
TSE related issue. The Ames facility, particularly in light of 
September 11, is one that we want to modernize as quickly as 
possible. We have had money allocated for modernization. The 
2001 budget had, I believe, $9 million, the 2002 had $40 
million, and the Defense Supplemental Appropriation, had $328 
million approved. Of that $328 million supplemental to USDA, it 
has about $64 million for Ames, so we are going to move as 
quickly as we can on the Ames plans.
    One good thing about the $64 million out of the defense 
supplemental is that the funding is no year money, so that we 
can begin to spend that money on Ames as quickly as we can get 
the plans done and the modernization begun. We can carry it 
over as we need to into the next year, and spend it to begin 
the construction. So Ames is a priority.
    I have had the opportunity to visit Ames personally to see 
some of the issues there and we are committed to making sure 
that even though we are looking at all of our laboratories to 
determine where the critical issues are, Ames is certainly one 
that is going to be maintained as a critical laboratory for us, 
particularly in light of the kinds of issues we are dealing 
with today. Whether it is new kinds of animal diseases, having 
to address TSE and BSE related issues, we do most of the 
testing there at Ames, or some of the new homeland security 
issues. So we are committed to moving forward with these plans.
    Mr. Latham. Is there any feeling in the Department or the 
administration as far as accelerating the development there? 
Obviously, with the additional supplemental last year that gave 
it a real boost, but I don't believe there is a line this year 
in the budget for it.
    Mr. Dewhurst. A couple things might be helpful on that 
question, Mr. Latham. When the Secretary sent her report on 
Ames to the Congress last May, the recommended option was an 
accelerated five-year program. That was our understanding of 
how fast the folks could implement the modernization plan. The 
dollars in that proposal indicated a need through fiscal 2003 
of about $73 million. We have, in hand, as the Secretary 
iterated, about $113 million. So we are not suffering from a 
shortage of funds at the moment with respect to Ames. I have 
been told that they expect to put up for bids the first major 
design contracts for the large animal holding facilities and 
the bio-tight facilities by the end of March. Obviously we will 
have a budgetary challenge in fiscal years 2004 and 2005 to 
come up with the money to finish the project. But at the 
moment, I think we feel fairly confident that they are going as 
fast as they can, they have the resources they need and they 
are operating consistent with the plan the Secretary 
recommended to the Congress.
    Mr. Latham. So you are saying there should not be an 
additional appropriation for this fiscal year then?
    Mr. Dewhurst. The reason we didn't budget for one is 
because of our understanding that the funding needs were 
covered through fiscal year 2003 consistent with the plan.
    Mr. Latham. I see the quickness that we are rebuilding the 
Pentagon and everything, and I would think there would be ways 
of accelerating it because it is a national need, and obviously 
the livestock industry could be devastated overnight and it's a 
$105 billion industry that we could lose overnight. So it's a 
small investment. I see my time is up, Mr. Chairman.
    Mr. Bonilla.  Thank you, Mr. Latham.
    Mr. Hinchey.

                        STATEMENT OF MR. HINCHEY

    Mr. Hinchey. Thank you very much, Mr. Chairman. Madam 
Secretary and gentlemen, nice to see you all.
    Madam Secretary, I have some questions about apples and 
other specialty crops and about dairy policy and also about 
pests, but my first question today is on overall agricultural 
policy in our country and the way it affects agriculture and 
the environment.

                         FARMLAND CONSOLIDATION

    We have seen indications that our agricultural policy is 
resulting in consolidation--larger and larger farms at the 
expense of the family farm and middle-sized farms. The 
situation in Iowa, and I mention Iowa only because we have 
statistics that come from the University of Iowa, is indicative 
of what is happening to agriculture across the country. I want 
to focus on hog farms for a moment. The size of hog farms has 
more than tripled since 1995, going from about 400 hogs per 
farm up to more than 1,300 hogs per farm. The result of that 
has been serious pollution problems that come about as a result 
of more hogs.
    In Ames, Iowa, for example they are having very serious 
problems with the quality of drinking water as a result of 
runoff, pesticides and other agricultural inputs, and 
increasingly the penetration of manure from these huge farms 
into the groundwater as well as into the rivers. The New York 
Times reported 152 fish kills in Iowa, leaving 5.7 million fish 
dead as a result of increased agricultural inputs in water.
    These environmental problems are not locally confined. We 
are seeing the consequences of agricultural runoff in the 
oceans, out into the Gulf of Mexico, and even further out that 
can be traced right back to agricultural inputs and the runoff 
from these large hog farms. Our agricultural policy has been to 
encourage these large farms at the expense of the smaller 
farms. For example, over the course of the last 5 years, Iowa 
received $6,575,000,000 in agricultural subsidies, most of them 
going to these larger farms. We are also seeing increasing 
crossover between the people who grow corn and the people who 
feed that cheap corn to the animals with interlocking 
directorates between the corn growers and the hog farmers.
    It strikes me that we have some very serious problems in 
our agricultural policy, by providing billions and billions and 
billions of dollars to encourage agricultural practices that 
are resulting in the decimation of the family farm, the 
consolidation of agriculture, and growing agricultural 
conglomerates. At the same time, these policies result in 
increased pollution in groundwater, in rivers, out into the 
Gulf of Mexico and into the oceans.
    Is any thought being given by the administration or others 
to recommend changes in agricultural policy? The Senate, for 
example, just put a ceiling on farm subsidies, cutting the 
payment level roughly in half. The House has not done that. 
Would the administration support a very modest measure like 
that, putting a ceiling on subsidies per farm? Are there other 
steps that we ought to be taking to try to bring some sanity 
into our agricultural policies?
    Secretary Veneman. I will be happy to try to answer your 
question the best I can, with regard to the consolidation of 
the farms and the increasing size of many farms. We talk about 
this issue quite extensively in the Food and Agriculture Policy 
Book that was issued in September, and there is growing 
consolidation of a number of farms in this country. I want to 
address for a moment the issues that you raised about the 
environment, because I think they are important and it is 
something that I think is being certainly recognized more and 
more, both in the legislation that is pending in both the House 
and the Senate with regard to the farm bill as well as by 
producers themselves.

                         CONSERVATION PROGRAMS

    Both of the bills that are pending do put substantially 
larger amounts of money into environmental programs. In Iowa, 
for example, where you talked about the issue of pesticide 
runoff, one of the programs I was able to announce in Iowa 
earlier this year was a partnership program, with the State of 
Iowa. There are going to be some buffer zones and some ponding 
of some of this runoff water so that it doesn't go into the 
public waterways. We think those are the kinds of programs that 
are going to help farmers with working farmlands, help 
agriculture, and help users of water.
    So we were very pleased when we were able to announce that 
program in Iowa and those are the kinds of programs when we 
talk about wanting to enhance programs for working farmlands 
that we are talking about.
    Also in the Senate and House versions of the farm bill, 
there is additional money put in for the EQIP, which helps with 
manure runoff and giving farmers and ranchers the ability to 
have some cost share with regard to environmental programs that 
will help with manure runoff.
    As I said in my opening statement, I just returned from 
visiting farmers in a number of States and it is quite 
instructive, I think, as you go around the country and talk 
with farmers and learn, how many programs are now ongoing. We 
were at the Rice Research Center in Louisiana the other day 
working on sustainability of agriculture, and looking at 
chemical and water quality issues. More and more universities 
and research organizations are joining together with farmers to 
address these issues. When I was in California, for example, 
one of the things we were having a very serious problem with 
was water quality from dairies and primarily, this was not an 
issue of the laws not being enacted but that they weren't being 
enforced.
    So we put together what was called a Quality Assurance 
Program bringing together the universities, the producer 
groups, and all of the regulatory agencies, both State and 
Federal. We put together best management practices for the 
producers, and then the trade associations went out and trained 
the producers on these things, and how to follow the water 
quality laws. These are important programs that we want to be 
involved with. We have had extensive conversations with USEPA 
about the kinds of things that are happening in water quality. 
We have Governor Whitman and our Deputy Secretaries, and they 
have been very proactive in looking at the entire hypoxia issue 
in the Gulf and where all of that is coming from. We are going 
to look at a partnership kind of approach with the EPA looking 
at some of these issues.
    I think one of the things that I see with agriculture, as I 
noted in my opening remarks, farmers are the best stewards of 
the land. We want to make sure we give them the appropriate 
tools to continue to make the best decisions, and give them the 
kinds of support that will help them with working farmlands 
rather than just taking land out of production.
    One of the things I have noticed as I have gone around and 
talked with farmers and ranchers, is that they are very 
proactive on these issues, they are working with their research 
institutions, and their universities, on ways to try to find 
solutions. We want to focus as much of our program support on 
these kinds of programs to help farmers and ranchers address 
some of these issues.
    Mr. Hinchey. Thank you. This is a subject that is going to 
require additional examination.

                        ANIMAL WASTE MANAGEMENT

    Ms. Kaptur. Would the gentleman be kind enough to yield for 
a second? For the record, I would ask the Secretary if she 
might specifically identify which programs within USDA, other 
than conversations between respective secretaries of major 
departments and agencies, which programs really go at this 
issue of manure management and the proper handling of effluent 
and so forth?
    [The information follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    I will state also for the record, Ohio is getting enormous 
numbers of Dutch dairies coming in now, and where we live, our 
region of the State people are deeply worried about what is 
going to flow at us from the western part of our State, and I 
would just place on the record, if I might, the problem with 
the way the system works today in Ohio at least is nobody is 
proactive. They are not on the ground with those farmers and 
investors when those facilities come in trying to deal with the 
manure issue first. EPA can regulate afterwards, but it is the 
proactive, preparation of that manure management that is so 
important. I don't see that happening, so I thank the gentleman 
for his question.
    Secretary Veneman. I think that is where programs like EQIP 
come into place, programs like the Natural Resources 
Conservation Service technical assistance which we have, and I 
agree with you, there is a lot of concern around the 
countryside about pending EPA regulations on AFOs and CAFOs. We 
are working very closely with EPA to make sure that when they 
promulgate these kinds of regulations, they understand the 
impact on agriculture and the various sizes and types of 
agriculture. These are the kinds of programs we are working on 
very closely with EPA.
    One of the things that EPA has done is put in a position 
that is an ag liaison, someone who focuses on impacts of EPA 
regulations on agriculture, and we are going to continue to 
coordinate with EPA on these issues. Deputy Secretary Moseley 
has actually had that position a long time ago, but worked in 
these issues for a number of years. He has dealt with animal 
operations and is heading up our effort with EPA in terms of 
this partnership to look at how we address a number of these 
issues and what kind of programs are most appropriate.
    We have a billion dollars set aside or budgeted for the 
EQIP. That's directly to help livestock farmers address some of 
these waste issues and how to deal with waste.
    Mr. Bonilla. Thank you, Madam Secretary. Thank you, Mr. 
Hinchey.
    Mrs. Emerson.
    Mrs. Emerson. Thank you for being here today, Madam 
Secretary and gentlemen. I am going to submit, if I could, my 
statement for the record, just because I want to try to get to 
questions immediately.

                 SECTION 416(B)--FOREIGN FOOD DONATIONS

    Mrs. Emerson. Specifically Madam Secretary, I would like to 
talk to you about the budget and your proposal to discontinue 
section 416(b) of the Commodities Donation Program, which is a 
dramatic change considering that the program has purchased and 
donated hundreds of millions of dollars in U.S. farm 
commodities in recent years, and we know that those purchases 
and donations help our farmers here in the U.S. And our 
ranchers as well as needy families in the developing world.
    Certainly it has been a great help to prevent a famine in 
Afghanistan. I understand the Department may be compensating 
somewhat by increasing the resources dedicated to PL 480 Title 
II programs, but I am a little confused. I want to be sure that 
I understand the approach the Department is taking. Is this an 
indication of a decreased commitment to food aid, or would you 
characterize the Department's commitment as strong as ever?
    Secretary Veneman. First of all, I would say that this is 
not just a Department issue. This is an Administration issue. 
It is an issue which has had substantial review by all of the 
agencies of the government that deal with food aid--whether it 
is AID, the State Department, or a number of other agencies 
that have a role in food aid. There is not a proposal per se to 
discontinue Section 416(b), but rather, it is felt that it is 
better to budget for food aid in the P.L. 480 Title II budget. 
Substantial increases were allocated to the Title II budget in 
lieu of food aid that has been in the last few years 
distributed through Section 416(b).
    The Section 416(b) program is still available. We plan to 
use it particularly for things that we have in surplus, like 
nonfat dry milk which I saw piles and piles of yesterday in 
Kansas City, but we will have Section 416(b) available. When 
you look at the kinds of things we are dealing with in the 
world today, I think it is good to have 416 available as an 
emergency authority.
    But we want to be able to budget and plan for our food aid 
through the P.L. 480 Title II program, and I believe in our 
budget last year, we indicated that there was going to be a 
review done of these programs, and that was the conclusion of 
the interagency study team. That is why you see in our budget 
this year substantially larger amounts of P.L. 480 Title II and 
less allocated to Section 416(b), but again, we have not 
discontinued our Section 416(b) authority. It still exists. If 
we need it, it is there. It is available. And I would say that 
the Administration's commitment to food aid is as strong as 
ever and we have been very proactive participants in food aid, 
whether it is feeding the Afghanis or refugees in refugee camps 
or food aid all over the rest of the world. And so I certainly 
don't want to, in any way, give the impression that this 
Administration is not committed to food aid.

                         SECTION 416(B) REVIEW

    Mrs. Emerson. Let me ask you, then, since there was an 
overall review, is there a final document or some such report 
that you would be able to share with our committee?
    Secretary Veneman. I am not sure whether there was a final 
report or not, but we will certainly look into it.
    [The information follows:]

    A report on the Administration's review of U.S. foreign 
food assistance activities is being prepared. The 
Administration intends to make the report available to Congress 
once it has been reviewed and cleared by the agencies which 
participated in the review.

    Mrs. Emerson. Because if the Department did a review, I 
assume there has to be some answers to what happened in that 
review. So in other words, we are discontinuing funding for 
416(b), but not the authority. Do you think that by not funding 
it at all we risk losing the interest and participation among 
countries, and perhaps some of the PVO's who have been 
accustomed to that program? Do you think that it is possible 
that we could decrease overall U.S. food aid or will there be a 
bigger focus on Title II of P.L. 480?

                    P.L. Title II Donations Program

    Secretary Veneman. As I said, the focus is going to be on 
Title II and allocating the various commodities through Title 
II that we have been involved with. The United States intends 
to fulfill our commitments to the World Food Program through 
Title II. We have put a lot of money through section 416(b) 
into the World Food Program. It is anticipated we would put 
that donation in through P.L. 480 Title II. We believe that by 
putting additional resources into Title II, we will be covering 
all of our food aid needs.
    Mrs. Emerson. Excuse me. Mr. Chairman, my time just blinked 
red, but could I ask you a question about the PVO's, if you 
don't mind? I am concerned that the PVO's are going to lose 
some interest here as well as some of the countries losing 
interest; so how are we going to deal with that possibility?
    Secretary Veneman. I haven't heard that countries or PVO's 
are losing interest. I think it is more a matter of how the 
funding is allocated as opposed to whether or not it is going 
to be there.
    Mrs. Emerson. I appreciate your answers and certainly you 
can get us a copy of that report, and I will have other 
questions to follow up.
    Mr. Bonilla. Thank you, Ms. Emerson.
    Mr. Farr.
    Mr. Farr. Thank you, Mr. Chairman. I think Mr. Boyd was 
here ahead of me.
    Mr. Bonilla. I apologize. I thought you all arrived at the 
same time today. Am I wrong about that? Anyway, Mr. Farr.

                            Trade with Cuba

    Mr. Farr. Thank you very much. I appreciate it. I have a 
whole series of questions. I will try to get to them quickly. 
First, I want to make an observation for you that I spent the 
weekend in Cuba following up on an initiative by this 
committee. This committee, led by Mr. Nethercutt, Mrs. Emerson 
and the rest of us were instrumental in pushing for the lifting 
the embargo on trade on Cuba. President Castro told me, and he 
was in my group of agricultural folks where Michael Rue from 
USA Rice, you may know from Sacramento days and Herb Schmidt 
from Mondavi Winery. He told Michael, who sold him the rice on 
the emergency aid that was allowed that the Cuban government 
was prepared to buy a billion and a half more food from America 
if the licensing can be done quickly, and if the financial 
tools that are allowed for other sales can be made available to 
sellers and buyers.
    I know that you don't control the licensing, but a billion 
and a half dollar market for agriculture is not something we 
should turn our noses on, and I would really urge you to use 
your authority as a member of the cabinet to work with Treasury 
in speeding up these licenses, and I know that every member of 
this committee who actively supported that will be behind you.

                       National Marine Sanctuary

    The other issues I wanted to just bring up is you have 
funded through NRCS a six-county study of the entire watershed 
going into the National Marine Sanctuary with a consent of the 
farm bureaus of those six counties, San Mateo, Santa Cruz, 
Santa Clara, Monterey and San Luis Obispo. As I know, it is the 
only one in the Nation that is going to do it, and I encourage 
you, following up on discussions, to use this as a model, and 
frankly we need to adequately fund it so that we can get the 
data which would be available, and the protocols that they are 
developing would be available to other regions.
    This is about a 30,000 square mile area, so it is a 
significant study area. My questions lead to essentially, and I 
will go through them quickly and as time allows, it may be this 
round or the next you can get into them.

                         WIC Funding allocation

    The DOD appropriations for WIC, I understand there is a 
kind of across-the-board distribution of these moneys rather 
than on an as-needed basis by States, and some States, 
particularly southern California, has found that they are 
oversubscribed, they don't have enough money, and I would ask 
you to look into allocating, based on high need, not just based 
on a formula grant.

                             Methyl Bromide

    On methyl bromide, the issue is now in looking at it, I 
think we might have a breakthrough if we could really use 
technology investing in emission reduction. Essentially, if you 
have got zero release of emissions, you don't have an ozone 
depleter, and we ought to be spending some research technology 
dollars on that.

                       GLASSY-WINGED SHARPSHOOTER

    I would like to thank you for support of the glassy-winged 
sharpshooter. In fact, the California Wine industry is giving 
all the members of this committee some wine this afternoon, and 
we may ban soft money, but we are not going to ban wine. I 
would be interested in what your allocation is for 2003 on the 
glassy-winged sharpshooter?

                       Sudden Oak Death Syndrome

    And lastly, the issue of the sudden death syndrome, this is 
not just a California issue anymore. It is found in affecting 
rhododendrons, huckleberry fruit and soil and Canada, as you 
know, has had an emergency quarantine on all known hosts, 
including all oak and azalea-related plants. It has become a 
big problem in California and we would be interested in 
additional resources made available to that.
    So those are my four question areas, and I guess also if 
you would like to comment on Cuba, I would really appreciate 
it. It is the only country that we have put these kinds of 
licensing restrictions on, and it is foolish. We have got 43 
students down there studying in their medical schools. We do 
have other relations with Cuba, and we ought to make 
agriculture a strong one. Thank you.

                            TRADE WITH CUBA

    Secretary Veneman. I will comment quickly on some of these 
issues. Obviously on the Cuba issue, we have sent now as a 
result of the language that was in the Appropriation Act, I 
think the year before last, as well as, the hurricane that 
happened the first food into Cuba.
    Mr. Farr. $43 million.
    Secretary Veneman. I have talked with many people in 
agriculture who have a great deal of interest in this issue, 
and certainly the Administration is aware of agriculture's 
interest.

                         WIC FUNDING ALLOCATION

    I will look at the WIC allocation for you. I was unaware of 
that issue. We do want to make sure we have adequate WIC funds. 
I think we have allocated additional funds this year. We 
certainly, as was discussed earlier, put more funds into WIC 
for the 2003 budget. We are very committed to the program, and 
let us look at your issue.
    [The information follows:]

                    WIC Funding Distribution Formula

    Regular: A summary of the formula contained in the 
authorizing legislation is as follows. The actual operation is 
very complex, so some detail has been omitted.
    There are two basic steps: (1) Fund a grantee's current 
participation. Funds are provided to support current 
participation. This includes an adjustment for food price 
inflation. It is called ``base'' or ``stability'' funding. (2) 
Funding for increased participation. This step makes funds 
available first to States which serve a low proportion of their 
WIC-eligible population relative to the proportion of the WIC-
eligible population being served in other States and then 
second to other States which serve higher proportions of their 
WIC-eligible population. States may refuse the offered funding. 
The money then is put back into the sum of funds available for 
distribution to other States.
    Supplemental Funding: The terms of the supplemental 
exempted the $39 million from the regular distribution formula. 
The States have reported approximately a $100 million shortfall 
in funding necessary to support October participation. Part of 
that shortfall is due to the inflation estimate being raised 
for 2.2% to 3.2%. (See step one under the regular formula 
distribution). Accordingly, the first step in distribution of 
the $39 million was to offer funds to all States that needed it 
to cover the 1% increase in inflation. The remainder of the 
funds were distributed in proportion to a State's share of the 
reported shortfall.

                             Methyl Bromide

    The methyl bromide issue, of course, is something we have 
been dealing with for over 10 years, and we know how important 
it is both to export fumigation as well as the strawberry soil 
fumigation issue and other soil fumigations. But we have to 
constantly be looking at new technologies as they impact 
agriculture. There are so many issues today that we can find 
solutions for through technology, and we will certainly look at 
the technology issues that you are looking at with regard to 
methyl bromide.

                       Sudden Oak Death Syndrome

    The sudden oak death syndrome has money available for 
research through the Forest Service. We are in the process now 
of putting together the request for emergency funding as we 
begin to deal with this as an emergency disease program. So we 
are in the process of looking at the resource base under the 
emergency authority for that.

                       Glassy-Winged Sharpshooter

    Mr. Farr. How about the Glassy----
    Secretary Veneman. Oh, I am sorry. I am going to have Steve 
look at the actual numbers.
    Mr. Dewhurst. Currently we have an estimate, let me start 
with 2002, of a little over $5 million for that problem. We do 
not have the details from APHIS yet, but that is the estimate. 
I do not have an estimate for 2003 for that disease. I simply 
have not received one from the agency, but we will let you know 
as soon as we get one.
    Mr. Bonilla. Thank you, Mr. Farr.
    Mr. Kingston.

                Emergency/Bonus Buy for Chicken Products

    Mr. Kingston. Thank you, Mr. Chairman. Madam Secretary, it 
is great to see you. We appreciate your impromptu visit in 
Savannah, Georgia. Anytime you have plane problems, let us 
know. We certainly appreciate the courtesy of allowing us to 
put a couple of producers in. Some questions I don't think you 
are familiar with. One is, and I understand that I believe they 
met with Secretary Moseley about the spent chickens egg 
producers and the need to find a market for spent hens, either 
for meat or research or bonus buyout. Any headway on that? I 
know it is early.
    Mr. Moseley. Not yet. We are taking a look at that and 
trying to see if there is something we can do to help the 
situation. We understand very graphically the difficulty that 
they are facing, and they made a very good presentation to us, 
but we have not come to any resolution yet on how we can assist 
in that area.
    Mr. Kingston. Okay. I appreciate that, and let me know how 
we can help because I believe there are a number of people in 
this committee and in the House that want to be part of that 
solution. One kind of subcategory on that is leghorns; and 
leghorns, because I believe they are older and smaller, their 
bones are more brittle and traditionally they have not been 
used for meat, but they actually have a high protein value and 
a very good taste.
    There are two types of spent chickens, and this is one of 
the better kind. We want to find out if there are ways to 
utilize their meat for human consumption more than just for pet 
food, because it is a very good product that we are 
underutilizing out there in the market in terms of people. Has 
anyone brought up the leghorn issue up----
    Mr. Moseley. No. That issue was not raised when the group 
was in.
    Mr. Kingston. If you will invite me to, I will follow up 
with some details on that.
    Mr. Moseley. You are invited. Thank you.

                             Peanut Program

    Mr. Kingston. Madam Secretary, our good friend, Joe 
Bobherb, was at that meeting the other day and asked questions 
about the peanut program and his concern was that the farm bill 
passes, it is going to have a lot of changes on the peanut 
program and he wants to make sure you all are moving kind of in 
anticipation of that bill's language becoming law so that as 
soon as the bill is passed, peanut farmers don't have to wait 
any even longer, and I think you had expressed sensitivity to 
that already. Do you want to say anything?
    Secretary Veneman. I can reiterate what I said in response 
to his question when I was in Savannah, and that is, we are 
doing everything we can to be prepared for the implementation 
of the farm bill. In fact, if you recall, that was one of the 
reasons I was in Savannah to meet with FSA employees. I was in 
Kansas, making up for the trip I couldn't make the day I went 
to Savannah, yesterday and again talked with employees about 
their readiness to implement the Farm bill provisions.
    The peanut program is going to be fairly difficult to 
implement because it is going to create a lot of new issues, 
such as the establishment of new bases along with a number of 
other things. We are going to do everything we can to implement 
these and all the other provisions of the farm bill quickly. It 
is not going to be an easy task. Our people are very willing 
and desiring to be helpful, but again, it is not going to be an 
easy thing to do. We will do everything we can to implement the 
provisions of the farm bill, but the peanut program is going to 
be one of the more difficult ones and it will completely depend 
on the timing.
    Mr. Kingston. Well, we know it is all the Senate's fault, 
but we are not allowed to talk about the Senate in the House, 
so I would never bring that up that we passed the bill so long 
ago, and they have been sitting on it for so long. The other 
issue----
    Mr. Bonilla. You can do that at subcommittee, Mr. Kingston.

                         Risk Management Agency

    Mr. Kingston. Okay. You can. I appreciate that. In terms of 
the risk management agency, we don't have the political 
appointee in place yet; is that correct?
    Secretary Veneman. We have announced him. Ross Davidson is 
his name and he will begin on March 1. We had hoped he would 
begin a little earlier, but he is moving up from, I believe, 
Texas. We also announced the appointment of our Foreign 
Agricultural Service Administrator, who will be starting in a 
couple of weeks as well, Ellen Terpstra, who runs USA Rice 
Federation. So we are getting more and more of our 
Administrators and Deputy Under Secretaries in place every day, 
and we are very pleased that our team is coming together so 
well.
    Mr. Kingston. Well, my time has expired and I certainly 
appreciate it.
    Mr. Bonilla. Thank you, Mr. Kingston.
    Mr. Boyd.

                          Statment of Mr. Boyd

    Mr. Boyd. Thank you, Mr. Chairman. And Madam Secretary, 
thank you for being here. I want to start by complimenting 
President Bush and you. I have read with some interest the 
President's comments in Denver last week, and I was very, very 
pleased with his statement that crop and cattle production are 
a national security issue. There are some of us who have been 
saying that for a long, long, long time and will continue to 
say it and we are very pleased to have the force of the bully 
pulpit saying it too.

                          Farm Bill Provisions

    We look forward to working with him and you on how to 
implement that vision. The other thing I wanted to compliment 
you about in your opening statement was that you said that you 
had been around the country talking to farmers about farm bill 
implementation and I think you also said you like the approach 
that the House bill took. I am very pleased to hear that. I 
think you probably know why, last fall some of us weren't so 
sure about the position of the administration at that time 
because we were getting--particularly, I think, many of the 
authorizers were getting a mixed signal.
    So we are very pleased to work with you on the 
implementation of that farm bill. What I would like to do with 
my time, if I might, is ask you to outline briefly some of your 
thoughts about the farm bill so we will have a clear 
understanding of exactly which direction you think we should 
take as we move into these next critical weeks to implement it.
    Secretary Veneman. I will be happy to do that, Mr. Boyd. 
Let me just reiterate what the President said in his speech 
last Friday, the same one that you just complimented him on, 
because it was a very, very well received appearance before the 
national cattlemen. There were about 4,000 people there and he 
was extremely well received. As we have said, the 
Administration's principles which the President outlined to the 
cattlemen is that we want to build a strong Farm bill, that is 
generous, but affordable. That means since our 2003 budget has 
been released, we have reiterated the fact that we are prepared 
to support the Budget Committee in both the House and the 
Senate-approved number last year of $73.5 billion.
    What I said about the House and the Senate is our concern 
that the Senate bill would front-load that spending, 
substantially undermining the baseline in the outyears, and 
giving our farmers and ranchers uncertainty in the outyears. 
That is why I said that the House bill is much more preferable 
because it would even out that spending over the number of 
years.
    We also want a bill that is as market oriented as possible. 
We believe that higher loan rates will actually increase the 
kind of farm consolidation you were talking about, that it will 
increase overproduction, thereby creating lower prices, and 
that is not a result we want to see. Therefore the 
Administration has supported the loan rates that are contained 
in the House bill that were also the same loan rates that were 
contained in the Cochran-Roberts approach. We would like to see 
a bill that supports our trade commitments, but we should not 
put ourselves in a position where we are going to violate our 
trade agreements. As I have said many, many times, our trade 
commitments do not prevent us from supporting our farmers. It 
is a question of how we do it. And to the extent we can put 
more of the support for our farmers into what is called ``green 
box'' or less market-distorting policies, the less we will have 
to worry about violating our trade agreements and frankly the 
less we have to change our programmings if and when we enter 
into our new commitments under the WTO. So we think that is an 
important part.
    We also strongly support conservation measures for working 
farm lands. I have talked a lot about that today, and the 
importance of having good conservation programs that assist 
farmers and ranchers with working farm lands, not just taking 
land out of production but using programs like the EQIP and so 
forth.
    And, finally, the Cochran-Roberts approach had a concept 
that the President has talked about for some time, and that is 
farm savings accounts, accounts that would work something like 
a special 401(k) for farmers. We believe those kinds of 
accounts are another tool for farmers to manage risk, and so 
that would be another of the principles that we would support 
in terms of the farm bill. And those are the principles that 
the President outlined last Friday, and it is where we would 
like to see the farm bill proceed.
    Mr. Boyd. Thank you, Madam Secretary. Mr. Chairman, I see 
the red light is blinking at me. Are we going to have an 
opportunity for additional rounds?
    Mr. Bonilla. Yes, Mr. Boyd.
    Mr. Boyd. Thank you.
    Mr. Bonilla. Thank you. Mr. Nethercutt.

                      STATEMENT OF MR. NETHERCUTT

    Mr. Nethercutt. Thank you, Mr. Chairman. Welcome, Madam 
Secretary, and gentlemen. I appreciate, Secretary, your 
comments about the principles that the President supports and 
you support as it relates to the farm bill. I think with 
respect to green boxes and manipulations, for lack of a better 
word, to make sure that we are compliant, I hope we don't give 
up too early on some of the negotiations that will be very 
difficult along the way and preempt the opportunity for us to 
argue or to negotiate what is green and what isn't. I just urge 
that as a word of caution, that I hope we realize that we are 
going to be in some tough negotiations along the way with our 
European competitors and others. And so I appreciate your 
views, but I hope we will be cautious in what we unilaterally 
declare as compliant or noncompliant as far as American policy 
goes.

                          INTERNATIONAL TRADE

    I happen to think trade development is the most important 
effort that our Agriculture Department can assist on and that 
will benefit our farmers. I agree with Mr. Farr and Mrs. 
Emerson and Mr. Latham, Mr. Hinchey and others here who have--
and who feel that we shouldn't ignore the market in Cuba. From 
a food standpoint, my pea growers look at Cuba as a tremendous 
market, considering capture of this market over the years by 
Canada. They used to be a good market for us. Farmers are 
begging to have other market opportunities, and I know the 
sensitivity of Cuba. I realize that acutely. But on the other 
hand, I think we have opened a door, those of us who really 
fought hard for that, Sam and others, and I think it has been 
good for our farmers and will be better in times ahead.
    I am wondering what you can tell, the committee about what 
your Department has done in the last year or so to streamline 
our ability to respond quickly to market opportunities. The 
Australians and the Europeans and the Canadians have a system 
that is fast-acting. They deal with their State Departments and 
their Treasury Departments quickly, and sometimes we, I think 
historically, have been slow to pull the trigger with respect 
to capturing a market. You know, when Pakistan or others 
tender, we sometimes lose those sales, and I hate to have us 
lose the sales.
    Is there anything that you have done in your tenure thus 
far--and I know you are sort of getting into it now--to 
streamline our relationship between our State Department, our 
Treasury Department, and our Ag Department to benefit your 
farmers on trade opportunities that are existing out there?
    Secretary Veneman. Let me just comment on the areas that 
you brought up. One is what is green, that is permitted under 
the Uruguay Round Agreement, and what isn't. That is why we are 
in this debate about what we are going to do in the Farm Bill 
in terms of supporting our farmers and knowing where we can put 
permissible kinds of support, because of what has been defined 
as permissible as a result of the Uruguay Round. So I would 
just point that out.
    On trade development, I understand the concerns that you 
have with Cuba, but we continue to look to other markets of the 
world where we can get substantial market openings. I think it 
is extremely critical that we look at some of the trade 
successes that we have seen in the past year. One, of course, 
is the launching of a new round of trade negotiations in Doha. 
That was a huge undertaking, particularly after the failed 
attempt in Seattle a few years back.
    Secondly, as part of that Doha meeting, China and Taiwan 
were admitted for the first time into the World Trade 
Organization. Now, we have had some difficulties getting China 
to quickly implement the kinds of reforms that they need to 
make to create the market openings they agreed to. We are 
continuing to work very strongly with USTR and the State 
Department, to make sure we get those programs implemented as 
quickly as possible in China so that our farmers and ranchers 
can benefit from that tremendous market. I think for those of 
us from the West Coast, that the Pacific rim market is 
extremely important.
    We continue to work on bilateral trade issues, whether it 
is on specific problems such as sanitary and phytosanitary 
issues with a country, or other market opening steps, such as 
negotiating free trade agreements, looking at regional free 
trade agreements, bilateral trade agreements and so forth.
    With regard to your question on streamlining market 
opportunities, we have people in the Foreign Agricultural 
Service who work all over the world alongside their State 
Department and Treasury counterparts. We have worked very 
closely with the State Department, AID, Treasury and all of the 
other agencies that are involved, particularly in the food aid 
side of things, to ensure that we have a strong interagency 
agreement and process to go forward with food aid, because as 
you know, that is an interagency process. We have had 
tremendous support, for example, with the State Department, 
USTR and USDA working together on access for our products of 
biotechnology, which has been an issue in Europe. We have had a 
lot of support on a number of market access issues. So, I 
believe that we have strong working relationships with our 
counterpart agencies. And, we are going to continue to 
strengthen them and open up market opportunities where we can 
all around the world for our farmers and ranchers. We know that 
96 percent of the world's population lives outside the United 
States, and we produce much more than we can eat or use in this 
country. So, we have got to continue to expand those markets 
and make sure we hold onto the ones we have, because we do 
export so much already.
    Mr. Nethercutt. Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Mr. Nethercutt. Mr. Goode.
    Mr. Goode. Thank you, Mr. Chairman. Madam Secretary, thank 
you for being here today, and other persons with the 
Department.

                          PAYMENTS TO FARMERS

    Let me ask you this. I represent Halifax County, 
Pennsylvania County, and a number of rural counties in 
Southside, Virginia, and all of the local papers that have 
published the names of farmers and farm companies with the 
amounts that they have gotten in payments from the USDA over--I 
think it was a 4- or 5-year period. Now, that came about, as I 
understand it, correct me if I am wrong, and I can't remember 
the name of the group--requested under the Freedom of 
Information Act this information over the last 4 or 5 years. Is 
that correct?
    Secretary Veneman. Well, that is correct, but not entirely 
the whole story, because it not only was a FOIA request, but it 
went to court. This was before my time. It was the courts that 
forced USDA to turn the information over to what is called the 
Environmental Working Group.
    Mr. Goode. Did the Environmental Working Group request or 
did you give to the Environmental Working Group the names of 
farmers and farm entities and anyone that is getting money 
under CRP? Was that part of it?
    Secretary Veneman. I think that was part of it, yes.
    Mr. Goode. So you released that information?
    Secretary Veneman. Well, again, it is not us releasing the 
information, because this was released as a result of a court 
order before we assumed office. However, USDA did release that 
information. I think that was part of what the court required 
the USDA to release to the group.
    Mr. Goode. All right. Can you give me a letter or something 
stating whether CRP payments were in that?
    Secretary Veneman. Sure. We can give you a background of 
the----.
    Mr. Goode. All I want is to know if CRP payments were 
included in that.
    Secretary Veneman. We can get back to you on that.
    [The information follows:]

    CRP payments were included in the data provided to the 
Environmental Working Group.

                         PIGFORD CONSENT DECREE

    Mr. Goode. All right. On another matter, I sent you a 
letter back around the time this information was appearing in 
the local papers at home, asking you if you could release the 
names of the settlements with the black farmers, naming the 
farmers and the jurisdictions they were from and how much they 
got, just as the case with these other farmers. Are you all 
going to respond, yes or no, to that letter?
    Secretary Veneman. I am sorry, sir. I am not aware of that 
letter, but we will follow up and see.
    Mr. Goode. Well, I will get you a copy of that. It is in my 
office. Do you think you will respond favorably?
    Secretary Veneman. Until I see the request, sir, I don't 
know. We will look at it and talk to our attorneys. I can't say 
for sure since these issues are in litigation.
    Mr. Goode. Right.
    Secretary Veneman. And so for me to be able to respond to 
anything I must first see the request.
    Mr. Goode. This would be the request for the names and 
jurisdictions from which they were from, those with whom you 
have settled.
    Secretary Veneman. Right. And we will certainly ask our 
lawyers to take a look at the issue. But, again, this is an 
issue that has been the subject of substantial litigation and 
lawsuits.
    Mr. Goode. Which number should I fax that letter to?
    Secretary Veneman. 202-720-8077.
    Mr. Goode. 720-8077. All right. And that is my questions, 
Mr. Chairman.

                      LAMB DIRECT PAYMENT PROGRAM

    Mr. Bonilla. Thank you, Mr. Goode. Before I yield to Ms. 
Kaptur, I have one question briefly, Madam Secretary. I know 
that you are aware the difficulties faced by American land 
producers over the last several years. As a result of that 
hardship and after a lengthy investigations by the U.S. 
International Trade Commission, a combination of import relief 
and domestic assistance for the U.S. lamb industry was put in 
place to assist producers with the negative results caused by 
the flood of lamb imports. One of the key components of that 
package is the oft maligned and much delayed Ewe Lamb Payment 
Program, a program that lamb producers are eagerly awaiting.
    So my questions are: Has the Department cleared this 
package? If so, when can we expect the rule to be printed in 
the Register and when can producers expect their checks; and if 
not, when will it clear and will you work to expedite it 
through OMB?
    Secretary Veneman. Yes, sir, this rule is in the clearance 
process right now. We have been working to expedite it through, 
and we will certainly work with OMB to try to expedite it 
through OMB as well.
    We understand the issue with lamb producers. Actually, 
however, I was down in Texas recently and had the opportunity 
to visit one of your relatively new lamb plants, which was 
really quite interesting. It was called Ranchers Lamb, down 
near San Angelo, and it was a very interesting group of 
producers who have come together, along with people in the 
community. They formed a stock company, and created a 
processing plant so they could keep and have an outlet for 
their lamb producers in the region, creating a lot of very 
consumer-ready cuts, with recipes and, you know, the Texas-
raised symbol. They have been very successful, and it was very 
heartening to see that some lamb producers have come together 
and done so well. But, again, we are working on this to get it 
out as quickly as possible and certainly we will do everything 
we can to make sure this program is implemented quickly and 
efficiently.
    Mr. Bonilla. Well, there is probably no Member of Congress 
that has more lamb producers in this country than I do, and 
reflected by the picture that we have on the wall behind us. 
But time is of the essence, Madam Secretary. You know that, so 
we will hope for this to happen as quickly as possible.
    We will now begin our second round of questions. Ms. 
Kaptur.

                       FY 2003 BUDGET SUBMISSION

    Ms. Kaptur. Yes. Thank you, Mr. Chairman. I just wanted to 
clarify in my opening statement I talked about the increase 
requested in the budget for 2003, the 4 percent increase that I 
referenced at the beginning, was including FDA. So if we look 
strictly at USDA, the figures I have--and I just want to state 
them for the record--you are requesting in the new budget $518 
million in discretionary spending over last year, about 3 
percent. And in the mandatory area, there is a reduction of 
$606 million, which is about 1 percent. Those are the numbers 
that I have. So I just wanted to clarify that.

                 WIC FARMER'S MARKET NUTRITION PROGRAM

    Madam Secretary, I wanted to go to the WIC program, if I 
might, and I was pleased to see the administration including 
numbers there to meet the need in the country. You are asking 
for an increase of $364 million additional dollars, as I read 
the budget submission. One of my concerns is that in the same 
budget that you submit for the WIC Farmers Market Nutrition 
Program, there is zero dollars requested, and that is a bit of 
a conundrum to me from a policy standpoint, particularly 
because these dollars go directly in the pockets of farmers and 
at our farmers markets around the country and benefit thousands 
and thousands of consumers. In Texas, over 226,000 people; 
Ohio, 26,000; New York, 317,000; over the country, well over 2 
million. And I can tell you that in this program, if I look at 
my own district, when these coupons are cashed in at the 
farmers markets, most of the specialty crop producers who exist 
who remain in our area, in the very tough marketplace that 
Congressman Hinchey described, sell at our local farmers 
markets, and they are fruit and vegetable people. This program 
directly benefits them.
    And I guess my question to you--how many people across our 
country, especially farmers and consumers, are benefitting from 
this program--and ask you to please, as you are looking at 
increases in WIC, not zero out this program. It benefits 
agriculture absolutely, and it benefits over 2 million women, 
children, their infants. I really don't understand why this 
happened in the budget submission.
    Secretary Veneman. My understanding, and I will have Steve 
Dewhurst clarify this, but one of the issues is that there has 
been a restriction on the use of this program. There needs to 
be a certification that we don't need the funds for the 
traditional WIC program in order to put the the money into the 
Farmers Market Nutrition Program. We have not been able to make 
that certification for the 2002 year, and my understanding is 
that even with the substantial increase we have proposed, at 
this point we don't feel that we are able to make funds 
available for the 2003 year. Is that correct?
    Mr. Dewhurst. Yes it is.
    Secretary Veneman. And that is why it wasn't included.
    Now, let me just say that the other issue with this is it 
apparently gives only about $9 per recipient, which is a 
relatively small amount of money, and the question is whether 
we can figure out ways to better capitalize on the idea of 
using farmers markets, because I, like you, am a big supporter 
of farmers markets. We had lots of them in California. We 
supported them through the California Department of Food and 
Agriculture in terms of overall regulatory and enforcement 
activity, and I think they are a very important outlet today 
for farmers that are smaller acreage farmers. It creates a 
niche marketing opportunity. And we do want to look at ways 
where we can utilize programs to assist our farmers.

                        FARMERS' MARKET PROGRAMS

    Ms. Kaptur. Secretary, if I might just interject, in 
California there are over 2,800 farmers who are certified for 
this program, and this is followed through across the country. 
One of my continuing battles with USDA, long before your 
appointment, has been that the production side never talks to 
the nutrition side. Over and over and over again I see this 
problem, I can tell you, in this WIC program and also in the 
Seniors' Farmers Market Nutrition Program, which is another one 
that was defunded in your budget. I would ask you to please go 
back and look at these, because these really put cash in the 
pockets of farmers. Specialty crop producers in particular, 
largely around the urban areas of our country. They are the 
last farmers left and they really do serve people who need the 
food.
    Now, the $9, you know, here in Washington with incomes 
being what they are, more degreed people than anyplace else in 
the country, it is not the real world. In my district, $9 is a 
lot of money, and it is a lot of money at the farmers market 
where you can get good deals. And so I would just really urge 
you to reconsider these two programs and not decommission them, 
and to provide for the record the level of requests that have 
come from the various States.
    [The information follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Ms. Kaptur. My time is expired on this round, and I will 
wait for the next round.
    Mr. Bonilla. Thank you, Ms. Kaptur. Mr. Nethercutt.

                     LYNX INCIDENT IN THE NORTHWEST

    Mr. Nethercutt. Thank you, Mr. Chairman. I will be brief. 
Madam Secretary, I just have a comment and then a question. I 
think that the Department of Agriculture and the Interior 
agencies, Forest Service and others, will come under additional 
scrutiny, particularly this year, as a result of the lynx 
incident in the Northwest. I assume you are aware of that and 
the questionable nature of the science that then flows from 
what appears to be some highly improper activity on the part of 
Federal and State officials. I assume that your Department will 
be looking at that, addressing it, striving to make sure that 
the science that comes out of the department is accurate and 
verifiable and not fixed.

                   CONGRESSIONAL EARMARK ON RESEARCH

    I am sorry I missed your testimony earlier, because I was 
at another hearing, second thing I would say concerns the 
question of earmarks--and I know the sensitivity of this issue 
with the Office of Management and Budget. I would assert to you 
that the jointed goat grass research that is done in my 
particular district that addresses that particular issue and 
problem may not have application in Florida or Texas, but it 
does in my district. It helps our farmers, just as one example 
of a number of earmarks that we put in the bill. I hope the 
administration and you, and the Office of Management and Budget 
particularly, would have a sensitivity to the desire of members 
of this subcommittee who care deeply about agriculture. Every 
single one of us have different issues. We have different 
problems. We have different research requirements that are met 
and addressed by inserting a line item or a particular project-
related research function that is legitimate. It isn't wasting 
taxpayers' money. It is legitimately helping an agriculture 
problem.
    So I guess my question is to you, ma'am, do you appreciate 
that, do you understand it? And I know the OMB is dominant in 
this debate, but on the other hand, they don't, as the Chairman 
said, have a full corner on wisdom. I think we as people who 
deal with farmers on a day-to-day basis, whatever their 
problems are, citrus canker or jointed goat grass, have a 
legitimate position to take with respect to urging our Chairman 
to include these specific items that address the needs of 
farmers on the research side.

                     LYNX INCIDENT IN THE NORTHWEST

    Secretary Veneman. If I might just respond to both of the 
issues that you raised, one is this lynx issue, and I am, like 
you, very disturbed about that. Our Forest Service, apparently, 
did an internal review of this, but once this surfaced, both 
Secretary Norton and I requested that our OIGs do a complete 
review.

                   CONGRESSIONAL EARMARK ON RESEARCH

    Now, let me just say that I could not agree with you more 
that the work that we do in USDA and other Federal agencies and 
State agencies needs to be based on good, sound science. We are 
strong believers of that in this Administration. We have had a 
lot of conversations between Secretary Norton, myself, and 
Secretary Evans with regard to the work he has in NMFS. We are 
particularly concerned with the fact that the National Academy 
of Sciences report just came out and said that the work that 
has been done by some of the agencies with regard to Klamath 
was not based on science. We intend to work very hard on that 
finding and those issues and figure out ways that we can make 
sure that science prevails in the kind of programs and policies 
that we are administering in this government; because I can 
tell you that at the Cabinet level we feel very strongly, as 
does the President, about this.
    We did talk about earmarks earlier with the Chairman. I do 
understand your concerns very much, and I understand that the 
debates about agriculture today are so regional and so varied 
depending upon different crops, commodities, and regions. We 
know that there are varying issues. As I said to the Chairman, 
primarily the earmarks in the agriculture budget are those, as 
you referred to, the research ones, and we doubled the money in 
the National Research Initiative because we do believe that 
research ought to be done on a competitive basis.
    I think that in that process, in the competitive basis, we 
ought to be looking at regional issues. We ought to be looking 
at them also in what we do with our internal research in ARS. 
To the extent we can be responsive to needs of various 
industries, I think we need to continually look at the regional 
and commodity issues that happen to be unique to certain parts 
or areas of the country.
    Mr. Nethercutt. All right. Thank you very much. I know you 
have a tough time. I know you feel strongly relative to the 
lynx and the science issue, but getting other people in the 
Department, the civil servants, with all due respect, is a 
monumental task because they are there and it is tough to move 
them and they have a mind-set. So I know you are acutely aware 
of it.
    Thank you. Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Mr. Nethercutt. Mr. Hinchey.

                       FOOD AND NUTRITION SERVICE

    Mr. Hinchey. Thank you, Mr. Chairman. Madam Secretary, I 
want to express my admiration for the portion of the budget 
that increases funding for feeding programs. Food Stamps, 
Women, Infants and Children, school lunch, all increase 
significantly and I think very appropriately.
    The part of the budget that troubles me, however, is the 
Farmers Market Program. The budget zeroes out both the Women, 
Infants and Children Farmers Market Program and the Seniors' 
Farmers Market Nutrition Program.
    I would just ask you if you would kindly revisit that issue 
and see if there is some way that you can make a recommendation 
to the Congress to fund those programs. These farmers markets 
programs are particularly valuable in urban areas. In my own 
experience, I am speaking from urban areas that range all the 
way from the 8 million people in New York City, down to small 
cities of 25,000 people. Farmers markets are very important for 
both producers and consumers. So if you can take another look 
at that and make a positive recommendation to the Congress, it 
would be very much appreciated.

                      WATERSHED PROTECTION PROGRAM

    The other issue that I wanted to address or return to is 
the question of overproduction and the association of 
overproduction with water pollution. I think we really need to 
do more than try to address these problems as they occur, but 
think of this issue more systematically. We need to consider 
the nexus between agricultural subsidies for row crops and the 
resultant decline in prices for those row crops, and then the 
growers of those row crops on huge farms feeding these crops 
into hog farms. This is a nexus that is having a very 
destructive impact on both agriculture and on the environment.
    So I would hope that both here in the Congress and from 
your perspective as the Secretary of this Department, that this 
problem would get some additional attention. And in that 
context, I notice similarities and problems in communities like 
Des Moines, Iowa and New York City. These communities are very 
far apart and very different in their economies and their 
outlook, but nevertheless, they have very similar problems.
    Last summer, you provided $40 million to the State of Iowa 
to deal with the problem of nitrates in their drinking water, 
and you were absolutely right to do that. It was a critical 
problem and you came to the rescue of the urban areas, Des 
Moines in particular, in that regard. But what troubles me 
about the existing budget request is that it zeroes out 
watershed and flood prevention programs. The Watershed 
Protection Program is critical, both for a city like Des Moines 
which gets its water out of the river and the need to protect 
the watershed for those people. It is also critical for a place 
like New York City, where 8 million people get their water out 
of the Catskill Mountains and the Delaware River system. It is 
difficult to overstate the importance of the Watershed 
Protection Program.
    Again, I would ask you very respectfully to go back and 
look at that portion of the budget, see if there isn't some way 
that you can recommend to the Congress some significant level 
of funding to protect the Nation's watersheds. Water resources 
are critically important today. By mid-century, they are going 
to be invaluable, particularly at the rate that we are abusing 
them. So anything that we can do, every nickel that we can 
spend today to protect our freshwater supplies is going to save 
us hundreds of dollars, perhaps thousands of dollars, in the 
future. Watershed protection is critically important, and I 
hope that we continue to respect it and fund it appropriately.

                         CONSERVATION PROGRAMS

    Secretary Veneman. Well, I absolutely agree with you. The 
program--I did talk about in Des Moines which was under our CRP 
program, was even more important, because it is a partnership 
program with the States, and it leverages Federal and State 
monies together to be more beneficial. We were able to sign 
that agreement with the Governor back in August. And I couldn't 
agree more, this is the kind of program we have been talking 
about for working farm lands.
    Again, EQIP in terms of livestock waste is critical in this 
regard, too, to help deal with these water quality issues. I 
continue to believe in producers coming together with research 
institutions and regulators to find and use best management 
practices so we can be proactive about these kinds of things. 
So I agree we need to continue to look at every avenue. We need 
to enhance our research in these areas so we better understand 
some of these issues.
    As I said before, we are working closely with EPA on a 
number of these issues.

                        FARMERS' MARKET PROGRAMS

    Just to go back to your question on the farmers' market 
programs. We talked about that earlier, and as I said, we are 
committed to doing everything we can to help the farmers 
markets. I think they have been a very, very big part of what 
U.S. agriculture has been able to do in the last few years. 
Secretary Glickman started a farmers market at USDA which we 
have continued, and I am personally a big user of farmers 
markets myself. So we will look at that. But, again, it is a 
question of why these programs aren't in the budget. It is a 
question of really looking at overall benefit and priorities 
and other ways that we can accomplish some of the same results. 
But I do understand very much your concerns.

                      WATERSHED PROTECTION PROGRAM

    Mr. Hinchey. Well just to underline what you said a moment 
ago, an ounce of prevention, of course you know, is worth an 
awful lot. The Federal funding that you provide gives us the 
leverage that you mentioned for additional State and private 
funds. You can't get those private funds without the Federal 
funding for watershed protection.
    Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Mr. Hinchey. And now Mr. Latham 
perhaps would like to talk about New York.

                          FARM BILL PROVISIONS

    Mr. Latham. Thank you, Mr. Chairman. I want to compliment 
you as far as the Administration keeping the commitment of 
funding for the farm bill, and a lot of what we are talking 
about here goes to funding for the NRCS and getting local input 
and helping farmers themselves. And I have heard quite a few 
people talk about, you know, the amount of assistance we are 
giving directly to farmers as far as crop subsidies, and also--
I mean, I am very pleased that there is enough money here for 
all the environmental conservation initiatives.
    One thing, the funding that I have gotten for the Trees 
Forever, which is buffer zones and these new projects all over 
the State which have been very, very beneficial, but I have 
heard folks talk about the amount of money, and I guess I would 
refer somewhat more so to the bill over in the other body right 
now, where I think they have gone probably up over $50 billion 
of the $73\1/2\ billion available, that there the price 
supports are so high that it is in conflict with the additional 
funding we have, properly so, for environmental and 
conservation measures.
    And I would have Keith over here, if he would respond, Mr. 
Collins, as to, I guess, do you in your personal opinion as a 
career person give us some insight as to what you might see 
happen in the future as far as, fence row to fence row, every 
possible pound of fertilizer, every possible pound of chemicals 
going into the production side because the supports are so 
high. But, on the other hand, we have all of the environmental 
conservation dollars. And also if you could also answer the 
question--I doubt you will have an answer to it--is there any 
way to direct funding so it doesn't go into land values and 
rents?
    Mr. Collins. Thank you, Mr. Latham.
    Mr. Latham. We only have a couple of hours.
    Mr. Collins. Yes, that is what it probably would take. I 
think on the first point, the effect on production of the 
subsidy packages that we are envisioning, is related to Mr. 
Hinchey's point about this whole connection from crops to 
livestock. I have heard in economic circles that economists 
have looked at both the House and Senate farm bills and said, 
there is no problem here that less spending couldn't cure. I 
think that expresses economists' concern about the fact that we 
are insulating producers from market signals, and that is going 
to result in more production. We have seen very little 
reduction over the last 3 or 4 years, even though we have had 
some extraordinary low prices for some commodities like cotton. 
We had the lowest price in the last 2 years, in the past 30 
years. Yet we had record production last year in cotton.
    So, I think that there is an opportunity for us to continue 
with our acreage where it is, possibly even expanding it over 
the next few years, despite low prices and what has been fairly 
weak markets because of the subsidy packages that we are 
envisioning.
    I think the problem is worse in the Senate package, because 
as you mentioned, price support levels are 10 to 20 percent 
higher in the Senate bill compared with the House bill, and I 
think that the Price Support Loan Program is the most 
distortionary in terms of economic incentives of all programs. 
So I think that that Senate bill would aggravate that problem.
    The Senate has taken a step, as you may have seen in an 
amendment that was adopted within the last couple of days, Mr. 
Durbin's and Mr. Lugar's amendment, to prevent new land coming 
into production from receiving program benefits, but I would 
point out that it exempts land that we called ``considered 
planted acreage'' under the old farm bill. We have about 210 
million acres as production contract acres under our production 
flexibility contracts. Under our production flexibility 
contracts, there is about 210 million base acres total under 
contract to USDA, and farmers last year planted about 175 
million of that. So there is plenty of acreage out there that 
is considered planted that is part of the base, that could be 
planted, and would not be deprived of a benefit, a program 
benefit, under the Durbin-Lugar amendment that was passed in 
the Senate.
    So, I think that this is a concern. What we have is a farm 
program essentially, and I say this as an economist, that when 
you get into a situation where you have low prices and you have 
reasonable weather like we have had for 6 years in a row, the 
only factor that can come into play to balance markets is a 
disaster, a crop disaster. So we have kind of structured farm 
programs so that in most cases we are going to have fairly low 
prices and we are going to wait for a disaster to try and 
balance markets.
    Regarding the second--and maybe that is pretty blatant and 
pretty frank, but you asked me as an economist to portray 
those----
    Mr. Latham. Would you also--if you have a disaster on your 
farm where you don't have a crop, a weather event, and if the 
farm bill is based virtually entirely as the Senate would be in 
5 years on target prices, how much money would you get if you 
didn't have a crop?
    Mr. Collins. If you didn't have a crop. I can't answer that 
off the top of my head.
    Mr. Latham. The answer is----
    Mr. Collins. For one thing, the Senate puts a lot of their 
benefits into the loan program. The loan benefits score about 
$10 billion higher over the 5 years in the Senate bill than in 
the House bill. If you don't have a crop, you don't get those 
loan benefits, so they are going to lose the loan benefits and 
they would be left to get the benefits under the----
    Mr. Latham. What does the target price mean if you don't 
have any crops----
    Mr. Collins. It certainly doesn't help. You get a much 
lower benefit level. I don't know of a way to avoid benefits 
getting capitalized into land values especially in the kinds of 
programs we administer. You would have to attach the benefit to 
a person rather than a farm or a property. That is a very 
different concept than what we operate now. So in the kinds of 
programs we have had and have historically run since the 1930s, 
there is no way to avoid capitalization.
    Secretary Veneman. If I might just follow up and reiterate 
a couple of the principles of the Administration that the 
President outlined in his speech on Friday, and say that we are 
very concerned about the Senate front-loading the bill. As I 
have said here today, that it would spend substantially more 
money up front during the first 5 years, thereby shortchanging 
farmers in the outyears. We also do not support the higher loan 
rates. The loan rates that are contained in the House bill and 
that were contained in the Cochran-Roberts proposal in the 
Senate are the loan rates that are supported by the 
Administration.
    Mr. Bonilla. Thank you, Mr. Latham. Mr. Farr.

                       GLASSY-WINGED SHARPSHOOTER

    Mr. Farr. Thank you very much. I wanted to do a quick 
follow-up on the glassy-winged sharpshooter, and that is that 
the researcher that was used in that program I think was one of 
those that were cut by your off-the-board cuts--across-the-
board cuts, and I hope that we could get that restored.

                       STATE PLANNING REGULATIONS

    But I really wanted to focus in on a point that has been 
brought up here. It is kind of a theme, and it is a question 
that I have of the Secretary, because she has had this unique 
ability to be the Secretary of Agriculture in California and 
now the Secretary of Agriculture for the whole Nation. And I am 
just curious. My impression is that the Department is paying 
out funds in the NRCS and the EQIP program to other States to 
pay to keep lands out of production, that in California could 
never be put into production because of local zoning and local 
water quality issues and other types of things that are built 
into State law. And I just wonder if it is your impression that 
the land is protected more so in California than maybe other 
States through good planning process rather than through 
subsidies. That is my impression, and I am wondering if you 
shared it at all or even thought about it.
    Secretary Veneman. I have thought about it to some extent, 
although I probably know California better in terms of some of 
the planning regulations that they have, and particularly in 
your area and some of the other near coastal areas they have 
been particularly restrictive on planning. I think it is either 
Napa or Sonoma that has done some fairly restrictive county 
zoning regulations as well, but those are very localized, and, 
you know, are really the decision of local lawmakers. They do 
have the impact of really determining where the urban areas are 
going to grow and where you are going to maintain agricultural 
land and/or open space. I think agriculture land does provide 
various strong benefits in terms of environmental benefits and 
lack of urbanization as well.
    I haven't really looked at this issue of NRCS paying out 
monies as you were talking about. I don't know whether Keith 
Collins or Jim Moseley has a thought on that, and I will look 
into this issue.
    Mr. Farr. Well, let me show the other Federal nexus there. 
As listings increase and as habitat protection and habitat 
management plans become adopted, which are going to have to be 
funded I think locally, we ought to allow that process--we 
ought to insist that that process do good. It is sort of best 
management practices about the land that everybody has been 
talking about, and we ought not to be sort of encouraging 
through subsidies to farmers not to have to practice best 
management practices for the total environment, not just for 
farming. And I think, frankly, if we could put some pressure on 
States to move that way, you could use your limited resources 
more effectively. And I would just like you to look into that 
if possible.
    Secretary Veneman. I would be happy to talk more with you 
about your concept in that regard and see where our programs 
overlap with the kinds of local decision-making you are talking 
about.

                       GLASSY-WINGED SHARPSHOOTER

    Mr. Farr. Could you also look into the researcher for the 
glassy-winged sharpshooter?
    Secretary Veneman. Yes. We will look at that. I am not 
familiar with that particular problem. Where was the researcher 
located?

                       SUDDEN DEATH OAK SYNDROME

    Mr. Farr. It was sudden death oak syndrome.
    Secretary Veneman. Okay. That would probably be a Forest 
Service issue. We will look at that.
    Mr. Farr. ARS.
    Secretary Veneman. ARS, okay.
    Mr. Farr. Fort Detrick.
    Secretary Veneman. Fort Detrick. Okay.
    [The information follows:]

                         Sudden Oak Death (SOD)

    ARS participates on the California Oak Mortality Task 
Force, which brings together public agencies, non-profit 
organizations and private interests to implement a 
comprehensive and unified approach for research, management and 
public policy. ARS has been represented on the discussion, and 
exchanges of information. ARS participates on the Interagency 
Coordinating Committee on Phytophthora ramorum to discuss 
management and control strategies for SOD.
    Funding was provided in 2001 by ARS as a one-time temporary 
use of funding to support extramural agreements. Funding was 
used to initiate research on host susceptibility and pathogen 
physiology studies. In FY 2002, ARS received an increased of 
$360,000 for SOD research at Ft. Detrick, Maryland. Fundings 
will support research on host range determination of the 
pathogen and to determine the biology and epidemiology of the 
disease, including sources of inoculum. There are no proposed 
program funds in 2003 for ARS research on SOD.

    Mr. Bonilla. Another good earmark, I might add, Mr. Farr.
    Mrs. Emerson.

                 SECTION 416(b)--FOREIGN FOOD DONATIONS

    Mrs. Emerson. One more quick question, Madam Secretary, 
about 416(b). I don't know where I heard this--and you know how 
the rumor mill works around here--but it seems that I heard 
this from a producer, I believe, in the last couple of days, 
was that one of the reasons the Administration had decided not 
to fund 416(b) was because of the belief that those donations 
were displacing commercial sales. Is there any validity to 
that?
    Secretary Veneman. I have not heard that particular 
allegation. There is always a concern about whether or not food 
aid replaces commercial sales, and certainly our farmers and 
ranchers don't want to be displaced in terms of commercial 
sales, particularly if it is their opportunity. I have not 
heard specifically of commercial sales that have been displaced 
by section 416(b), but we will be happy to look into that.
    Mrs. Emerson. Well, perhaps if you would enlighten OMB as 
to that, would be very helpful.

                     FARM BILL--PAYMENT LIMITATION

    Now, a question about the farm bill, and I don't mean to 
put you on the spot, but does the administration have any kind 
of a position on the Grassley-Dorgan payment limitation 
provision?
    Secretary Veneman. We have not taken a position on that. As 
you know, there are payment limitations in current law. There 
are payment limitations in the House bill. There are payment 
limitations in some other versions of the Senate bill. 
Obviously this is a very contentious issue at this point, one 
that really has a lot of regional differences, and commodity 
differences.
    I have just come from Louisiana and the Cotton Council 
meeting, so I have been hearing a lot about this issue. We are 
certainly going to be engaged in the conference discussion 
about this. One of the things we want to make sure we can do is 
implement whatever kind of provision is finally adopted by the 
Congress. Obviously it is the Congress that adopts the laws and 
we are going to have to implement them, but we haven't taken a 
specific position on the Grassley-Dorgan amendment.

                          COMMODITY PRODUCTION

    Mrs. Emerson. Okay. Let me ask a follow-up of that to Mr. 
Collins. What is the percentage of farmers that produce the 
largest quantity of commodities in the U.S.?
    Mr. Collins. I am not sure I understand the question.
    Mrs. Emerson. In other words, what percentage of farms in 
the United States produce the----
    Mr. Collins. Oh, okay. I think I know what you mean. Off 
the top of my head, roughly, if you look at the largest 10 
percent of farms, they produce about two-thirds of all that is 
produced in the United States.
    Mrs. Emerson. What would you say the average acreage is of 
those farms?
    Mr. Collins. Oh, it is for many of them, going to be beyond 
the eligible acreage implied by the Grassley-Dorgan amendment, 
if that is what you mean.
    Mrs. Emerson. That is exactly what I mean.
    Mr. Collins. To give you an example where the payment limit 
binds most, for crops like cotton, crops in your district, is 
going to be on the loan deficiency and marketing loan gain 
side. And if you look at a crop like cotton, we have been 
running loan deficiency payments of 23, 24 cents per pound. 
They could well be 28, 29 cents. For a mid-south cotton farm 
with a yield of about 900 pounds an acre, say, you would hit 
the payment limit at about 700 acres just on your cotton alone. 
That is before you consider soybeans or anything else.
    If you look at California with their higher yields, you are 
going to hit it at about 400 acres. So there will be a 
substantial percentage of producers, particularly in cotton and 
rice.
    Mrs. Emerson. Are you all trying to put together an 
economic analysis regarding the impact of this?
    Mr. Collins. We have looked at it, simply to verify the 
score that CBO gave it. The problem we have with analysis is 
our marketing data alone is not very good, because for crops 
like cotton, a lot of it is marketed through co-ops, and co-ops 
are the ones that bundle up the marketing loan benefits, and it 
is hard for us to track that back to the individual producer. 
So we have had some difficulty trying to figure out the exact 
number of cotton or of rice producers that would be affected. 
Certainly it is going to cause some short-term disruptions. 
Part of the disruption will be that producers will have to 
figure out how to reorganize and get more persons eligible for 
payments in the farm operation, which has happened in the past 
and which may well happen again, but certainly in the near term 
the, first couple of years, there will be more producers 
leaving some money on the table.
    Mrs. Emerson. Okay. Thanks. I have a very simple question. 
Could you all define a farm for me?
    Mr. Collins. Sure. We have a census definition of a farm. 
It is a place that produced or could have produced $1,000 or 
more in agricultural products in a year.
    Mrs. Emerson. So would a hobby farm fall into that 
category?
    Mr. Collins. Certainly.
    Mrs. Emerson. And is a hobby farm the type of farm we want 
to have the government support?
    Mr. Collins. I will let the Secretary answer that.
    Mrs. Emerson. Madam Secretary?
    Secretary Veneman. Well, I am not quite sure where you are 
going with this question. Let me just say that one of the 
things that we did when we produced the Food and Agriculture 
Policy Book, we looked at the fact that there isn't really a 
single definition of a farm today. You do have the legal 
definition of $1,000 or more. That covers a lot of people that 
are life-style farmers or hobby farmers. It also covers a 
variety of people that have smaller acreage. So the legal 
definition of a farm does include anything with $1,000 or over.
    But I think that one of the things this book recognizes is 
that there is such a large diversity of the types, and sizes of 
farms today. We break them down into the life-style farms, the 
intermediate farms where many of the producers have off-farm 
income but still have farming as a major part of their way of 
life, and then the large commercial farms. So it is a difficult 
issue today to really say whether or not a ``one size fits 
all'' policy is appropriate, given the kind of variance we have 
in the agriculture and farming sector.
    Mrs. Emerson. No. And I appreciate that. I think it is just 
very hard for our producers, who work 24 hours a day, to handle 
the criticism that the agriculture sector gets in general, 
particularly when you have Ted Turner and these rich athletes 
participating in CRP and the like. And so I just wanted to 
sense--this is a very touchy issue and one that I try to be 
very sensitive about. So thanks.
    Mr. Bonilla. Mr. Goode.
    Mr. Goode. Madam Secretary, we have given your assistant 
that----
    Secretary Veneman. Oh, good.

                         CONSERVATION PROGRAMS

    Mr. Goode. And to go back to--and I believe Mr. Collins 
responded, and you, too--to your knowledge CRP payments, 
wetland reserve protection payments to farmers and entities and 
also EQIP, were they included in the totals, or do you know?
    Mr. Collins. Let me tell you what we provided to the 
Environmental Working Group. We provided the Environmental 
Working Group the same data we provide to IRS. We essentially 
gave them the Form 1099 data. I don't get a 1099, so I don't 
know exactly what it has on it, but I believe on the 1099s, we 
have a total payment received by that Social Security number, 
and then we do break it out by programs that are funded by the 
Department.
    Mr. Goode. Do you break it out on the 1099, whether it was 
a crop subsidy or whether it was a conservation?
    Mr. Collins. Yes.
    Mr. Goode. Do you break out wetland reserve, CRP and EQIP, 
or do you know----
    Mr. Collins. I am not sure of the level or the detail of 
the breakout, but we do break down the aggregate into several 
components on the 1099. I don't know if we make such a 
distinction as you described. But the reason I said to you I 
thought the conservation programs were included, is because I 
believe that what the Environmental Working Group was reporting 
was that aggregate 1099 total that we reported to the IRS, 
which would have included that. I will verify that and we will 
provide the information to you.
    [The information follows:]

    At the February 13, 2002 hearing of the House 
Appropriations Subcommittee on Agriculture, Rural Development, 
Food and Drug Administration and Related Agencies, you asked me 
to respond in writing to your question regarding the 
Environmental Working Group (EWG). You asked whether data on 
payments made to producers under the Department's conservation 
programs were provided to the EWG in response to their Freedom 
of Information Act request for farm payments.
    The answer is that such payments were included in the data 
provided. The EWG requested all data on farm subsidies paid 
during 1996-2000. We provided data for each payment made and 
included codes indicating the program and commodity with which 
the transaction was associated. We do not know how the EWG used 
the data we provided in constructing the database they have 
made available on their website

    Mr. Goode. All right. Thank you, Mr. Chairman.
    Mr. Bonilla. Thank you, Mr. Goode. It is almost lunchtime. 
So I think Ms. Kaptur has only a couple of remaining questions, 
and Mr. Farr, do you have questions as well?
    Mr. Farr. No. I just have one closing comment.
    Mr. Bonilla. Very good. Ms. Kaptur.
    Ms. Kaptur. Thanks, Mr. Chairman, very much. It has been a 
very excellent hearing this morning and, Madam Secretary, we 
appreciate your openness and engagement with this committee 
very, very much.

                        FARMERS' MARKET PROGRAMS

    Let me just say in going back to this farmers market issue 
again and people talking about the Environmental Working Group 
and certain people being designated as having received millions 
of dollars just to put things in perspective, I had a farmer in 
my district, a small farmer, come up to me, family farmer, and 
say, ``Congresswoman, thank you. This is the first time in our 
lives''--these people raise chickens, sell eggs. They have a 
diversified farming operation where they have a roadside stand 
out in front of their house. They said, ``This is the first 
time we have ever received a penny through the U.S. Department 
of Agriculture,'' and I said, ``Well, may I ask you what did 
you receive this year?'' they said, ``About $5,000, and we want 
you to know this made the difference in the life of this 
family, because this is our sole source of income.''.
    So as I look at some of these big payments that are made 
and I think about--these are specialty crop producers. They 
sold pumpkins and squash and broccoli and all of these other 
things. I just put that into the record, because that is 
reality for most of the farmers that I represent. So I just 
wanted to say that they don't benefit from those other 
programs.
    Secretary Veneman. Can I just ask, was that through the 
Farmers' Market Program or a different program?
    Ms. Kaptur. It was through the WIC Farmers' Market 
Nutrition Program and through the Senior Farmers' Nutrition 
Program. I would encourage you, as you look around the country 
at these specialty crop producers, for most of these people I 
would venture to say these are the only programs that even 
touch them, and they are the ones that deal with poor seniors 
and at the end of the day give them, a whole basket of squash 
for maybe 50 cents or $1. There is a lot of that humanitarian 
work that goes on by our local farmers who aren't plugged into 
most of these major program crops. So I just mention that. I 
think it is important to take a look at that subset of 
individuals in our country.

                     INTERNATIONAL FOOD ASSISTANCE

    I wanted to turn to the international food programs if I 
might for a second, because this is totally my own conclusion. 
I have only served here for 20 years. Maybe if I give it 
another 20 my conclusions will be different, but I am very 
concerned about what I see at USDA as a lack of real focus on 
our international food programs and kind of a willingness to 
abdicate responsibility and give it to somebody else to think 
about, and to only view USDA as the cash register that moves 
commodities around the world and to put more responsibility at 
AID.
    One time I served on the committee that funds AID. I hope 
to go back there again, because I was one of their most ardent 
critics. And I did say to them, because as I travel around to 
where the billion people in the world who are hungry, they are 
mainly in subsistent situations, and I said to the head of AID 
in those days, I said, ``How many people do you employ, 10,000? 
How much of them know anything about agriculture?'' ``well, 
Congresswoman, we will have to come back to you.'' .
    It took them 3 months or something. They said it was 80 
people. Eighty people out of 10,000 people. And all I can tell 
you is there are problems over there, there are problems at 
USDA. The budget you have submitted to us suggests almost a 
virtual elimination of the Section 416 program that 
Congresswoman Emerson talked about.
    The budget talks about trying to increase P.L. 480, but if 
you look at the $500 million that was provided through 416 
versus maybe the 300 million you are talking about through P.L. 
480, it seems to me that there are some things falling between 
the cracks here.
    The budget also states that you are willing to move $1 
billion of effort over to AID, and I can tell you that this 
committee does not receive AID before us, and yet they 
administer a billion of the dollars that flows through this 
subcommittee. I am not very happy with that. The budget that 
you are submitting also proposes that more shipping costs be 
paid out of these funds, and I am not sure exactly what that 
means for this next fiscal year, but I am very, very concerned 
about USDA moving away from what--I believe you are the only 
department in this government that really understands 
agriculture, and you have the major nutrition programs. AID 
doesn't do that.
    We mailed the President a letter, Congresswoman Emerson and 
myself, back in November. We have never received a reply, but 
it talked about developing an Enduring Freedom a strategic food 
initiative involving all of the departments and agencies, with 
USDA in the lead, including the funding of the Global Food for 
Education Program, which is not included in this budget either.
    I am sharing this with you out of utter frustration with 
the Department of Agriculture that precedes your tenure, but 
really we need to get an answer to our letter which I will 
submit to the record, and I am also going to submit an article 
that was in one of our major Ohio newspapers this week about 
families in Afghanistan selling their children for food, and to 
say, you know, I think it is part of USDA's responsibility to 
be a leader and not a cash register. You know more about 
markets. We have farmers here who are willing to go around the 
world to help others. The AID doesn't have that. I have met 
those Beltway bandits that work for AID all over the world, and 
every time a grant program changes, they change their job title 
and they go out there and do something else.
    Through our land grant universities, through all the 
resources USDA has, we can really make a difference around the 
world, and I am begging you to consider moving back into the 
lead in international agriculture and development assistance in 
agriculture.
    [The information follows:]

              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Ms. Kaptur. So I wanted to state that and ask you in my 
questions, which I will submit for the record, for very 
detailed information on subsets of the budget relating to 
international food programs in agriculture, including the 
Global Food for Education Program which you have not funded, 
but I think all of this grows out of USDA's continuing 
retrenchment in the international agricultural food programs 
and development programs. Is that our perspective? Do you see 
it that way?
    Secretary Veneman. Well, I understand what you are saying, 
but I don't see it that way. We want to continue to be at the 
forefront of these issues, because I believe, having worked in 
the international area of agriculture for a number of years, 
these are important issues. I have been having conversations 
with the Administrator of AID, talking about how we can work 
together, particularly as we begin the rebuilding phase of 
Afghanistan. One of the programs I was involved in 12 or 13 
years ago was an interagency process with Poland, in which USDA 
played a major role in the agriculture rebuilding.
    Ms. Kaptur. Good job.
    Secretary Veneman. It was a terrific program. We used the 
Extension Service primarily to help farmers in Poland, 
establish the right kind of structure of agriculture for the 
country. So it worked well. The USDA has done this in the past, 
we know how to do it and I have been talking with the AID 
Administrator as well as people at the State Department about 
how we can assume a proactive role as we look at things like 
rebuilding Afghanistan. And I agree with you in that regard.
    I just want to say something about our farmers helping 
others. I just want to tell you a story, that I was in 
Louisiana visiting with rice farmers this weekend and, outside 
of USDA programs, they have decided to send a substantial 
amount of rice, just as a gift from them, to one of the refugee 
camps near Afghanistan. And I thought that was really a great 
effort on the part of some of our farmers and ranchers to show 
support for people around the world in need on their own.

                       GLOBAL FOOD FOR EDUCATION

    On the Global Food for Education initiative, I want to note 
that, while there is not funding in this budget for it, we are 
still operating the program with current funds that we have 
that were previously allocated. This is another one of those 
issues that is going to be addressed, we believe, in the farm 
bill, because both the House and the Senate version have 
authorized and funded the program. The difference is, I think 
the House bill funds it out of discretionary and the Senate out 
of mandatory. Is that right? Or vice versa. But in any event, 
there is a difference in terms of how it would be funded, and 
that is one of the issues that we think the farm bill will 
address in the conference, because it is contained in both 
versions of the pending farm bill.
    And so the Global Food for Education initiative is 
something that I think is a very good program. I talked about 
it when I did the U.S. address before the FAO conference in 
November in Rome. One of the disappointing things about the 
Global Food for Education initiative is that it hasn't been 
something that we have been able to get other countries of the 
world to embrace and be part of, and I think that is 
unfortunate. And I know a number of us have talked with 
counterparts around the world about getting involved in this, 
and I believe even the President raised it in the G-8 summit 
that was held in Italy last summer. So this is an initiative 
that we are not forgetting.
    We do want to get the pilot program analyzed and we are in 
the process of doing that so we can figure out how the program 
can work better. I do understand your concerns about this, and 
it is an issue that is being addressed in the current farm 
bill.
    Ms. Kaptur. I really believe this Global Food for Education 
Program in Pakistan could provide the answer to the Madrases, 
and I really think USDA can be the leader in that. We have 
brought people to USDA and to AID trying to explain how this 
could work, but I just hope whatever is going on inside the 
administration, you are a part of that discussion and that 
these programs are at the forefront, not somewhere in the back 
closet.

                            BIOFUELS PROGRAM

    So I thank you for receiving my comments, and my last 
comment will not be a question but, again, the budget 
submission you have given us here, there doesn't appear to be a 
continuation of the $150 million biofuels program that had been 
operational in the Department over the last 2 years through the 
Commodity Credit Corporation. And I know we will probably get 
more into this as we proceed with the new farm bill, but, Madam 
Secretary, do not lose your focus on USDA having a major part 
in the answer.
    I don't know if you saw this article. It was in Roll Call, 
which is seen by Members of Congress, talking about--very 
negative comments about ethanol and organizations like the 
National Petrochemical and Refiners Association paying for this 
ad. But absolutely biofuels, new value-added for our farmers 
out there in the field, new research on the biotech of biofuels 
production, this is a direction this country needs to move, and 
I hope Ohio and other States can be a real leader on that. But, 
the advertisement was a bad rap for biofuels, and I don't know 
what it means that the funding has not been included in this 
cycle from the CCC. Does that lessen your commitment to this, 
or are you handling it in some other way?
    Secretary Veneman. This is another issue that is going to 
be addressed in the new farm bill. I think on the Senate side 
there is even an energy title, but I just want to underscore 
our commitment to biofuels. As you know, the President did not 
grant the waiver that California wanted after the MTBE court 
decisions in California. I think that shows the strong 
commitment. We have continued to put rural development dollars 
into supporting new ethanol plants and biodiesel plants, and we 
do have a strong commitment to continue research in these 
areas. The President had an energy plan, as you know, this past 
year. Part of that plan included a strong reference to 
development of renewable fuels in this country, and renewable 
resources. We are continuing to be a very active part of that 
energy policy, as well as a number of other initiatives with 
regard to energy. We work closely on research projects with the 
Energy Department, and we will continue to be very proactive in 
that regard.
    Ms. Kaptur. Thank you. Thank you for your forbearance, Mr. 
Chairman.
    Mr. Bonilla. Thank you, Ms. Kaptur, and now a closing 
comment from Mr. Farr.

                         STATEMENT OF MR. FARR

    Mr. Farr. Well, thank you. First of all, I want to thank 
you, Mr. Chairman, and I want to thank you, Madam Secretary. I 
want you to know how important this committee feels about the 
role that we have in being the oversight and the appropriators 
for your Department. This last year when the 107th session of 
Congress came in, members of the appropriation committees 
reorganized, and on our side of the aisle, there wasn't a 
single person that wanted to leave the Agriculture Committee, 
although there were bigger committees with sort of higher 
appropriation levels than ours available.
    And I think it speaks to what Marcy brought up, is that you 
realize when you start dealing with the Department how broad 
your authority, your powers, are. There is no other agency in 
the Federal Government, one, that has the history; and, as I 
understand, you were created by Abraham Lincoln as essentially 
a Department to deal with consumer issues in a rural America, 
how you do the westward expansion and still keep in touch with 
Washington. It is an agency that has responsibility for our 
financial markets with all the Exchange and Commodity Board 
issues. It has the responsibility in foreign service for 
keeping all--we have an embassy--attache in every embassy.
    You are interested in keeping health care for America. You 
do the safety inspections, even including all of the passengers 
that come into the United States. Everybody arrives, as that 
picture up there shows. You are the lead agency, I think, in 
the environment, because you have to do more with the land than 
any other Federal agency, including the Department of Interior 
and Commerce.
    You are essentially responsible for all of the health of 
children in America and feeding our children and feeding our 
elderly folks. Most people don't know that you also have some 
responsibilities for housing, rural housing for farm workers, 
for water development and water protection, and certainly rural 
electricity. And for me who have had--people like myself who 
have had now nine Presidentially declared disasters in my 
district since I have been in public office, FEMA and the 
USDA's partnership with FEMA is the first responder to those 
disasters, because they usually destroy agriculture, because 
the disasters affect the ground.
    Underlying it all and all of our success in America--and 
agriculture is still being our number one industry--is the 
land. And I think we need to refocus on--as we have an America 
that is expanding in population, and California certainly 
reflecting it with 33 million people--we have too much sprawl 
going on in America. There is a group in Congress on both sides 
of the aisle, they are looking at how we develop our cities; 
city-centered growth they call it. That is a movement that is 
supported by almost every planning and architectural desire to 
try to get people more concentrated and closer to work so you 
don't have to commute. And it seems to me that we have a big 
role, that you have a role, and that we have a role as your 
oversight, to really recommit ourselves to America--an America 
which after 9-11, everybody is a little bit more interested in 
this country and where we are going. And I don't think there is 
any Department in the Federal Government that is going to have 
more responsibility for the way America develops--and develops 
what I like to call quality of life--than the U.S. Department 
of Agriculture.
    And I am really pleased that our Secretary has had the 
experience of not only being in Washington as Assistant 
Secretary of the Department, but really knows California where 
I think the cutting-edge issues are of this pressure of land 
and people.
    And I would say for me it is exciting to be on this 
committee. I think that this committee is one of the most 
important in the United States Congress. And the way we spend 
the taxpayers' money is going to determine whether these issues 
that have been brought up today, and a lot that we didn't even 
get to, will be dealt with appropriately.
    So this is really just one Member's reflection on the 
importance of us both, your role in the Executive and our role 
in the legislative, and what this Chair has done in allowing us 
to have easy access to you and your quick response to our 
question. So thank you for coming today. I look forward to 
working with you. The role that you have is just awesome. Thank 
you.
    Mr. Bonilla. Thank you very much, Mr. Farr. I notice that 
Mr. Kingston just arrived. We were about to adjourn. Did you 
have any additional----.

                       STATEMENT OF MR. KINGSTON

    Mr. Kingston. I wanted to come and see how good of a job 
you were doing in this meeting, Mr. Chairman. That was my only 
purpose in coming back. And now that I have seen what a great 
job you are doing--if I could--I have a few questions that I 
will submit to you later, and we had already discussed it. It 
just has to do with more of the Department of Labor than you 
guys, but it is a huge problem particularly with our folks, and 
that is my report.
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                            Closing Remarks

    Mr. Bonilla. I am glad you made it in time, Mr. Kingston.
    Mr. Kingston. And I am going to give you an A-plus.
    Mr. Bonilla. Ms. Kaptur?
    Ms. Kaptur. Yes, Mr. Chairman. I just wanted to extend to 
the Secretary from this side of the aisle an invitation to a 
brown bag lunch with our Members at any time or place that you 
would designate, and we would certainly invite the Chairman and 
the Members on his side of the aisle. I think just getting to 
know one another better outside of formal proceeding is very 
helpful, especially as we move toward a new farm bill. I warmly 
extend that.
    Secretary Veneman. I will be happy to do that.
    Mr. Bonilla. Very good suggestion. Madam Secretary, we 
appreciate your being here today. It has been a good hearing, 
and I think you can sense from both sides of the political 
aisle here that we have a tremendous amount of respect for you 
and are proud of the job you are doing. We look forward to 
working with you in developing a good appropriations bill for 
USDA this year. Thank you very much.
    Secretary Veneman. Thank you, and we look forward to 
working with you as well.
    Mr. Bonilla. The subcommittee stands adjourned.
                                       Thursday, February 14, 2002.

                      OFFICE OF INSPECTOR GENERAL

                               WITNESSES

JOYCE N. FLEISCHMAN, ACTING INSPECTOR GENERAL, OFFICE OF INSPECTOR 
    GENERAL
RICHARD D. LONG, ASSISTANT INSPECTOR GENERAL FOR AUDIT, OFFICE OF 
    INSPECTOR GENERAL
GREGORY S. SEYBOLD, ASSISTANT INSPECTOR GENERAL FOR INVESTIGATIONS, 
    OFFICE OF INSPECTOR GENERAL
DELMAS R. THORNSBURY, DIRECTOR, RESOURCES MANAGEMENT DIVISION, OFFICE 
    OF INSPECTOR GENERAL
STEPHEN B. DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE

                            Opening Remarks

    Mr. Bonilla. Good morning. The subcommittee will come to 
order. We are delighted today to have a hearing for the acting 
Inspector General of USDA, Joyce Fleischman. Ms. Fleischman has 
testified before as Deputy Inspector General, and we appreciate 
her appearance today in a somewhat different capacity.
    We also welcome everyone who is joining her this morning to 
help us with this hearing. From time to time, we would like to 
remind folks that this subcommittee had a part in creating the 
office that you now hold. This was done several years ago when 
there were problems involving fraud and other illegalities at 
USDA. The subcommittee suggested to the Secretary at the time, 
that there should be an office that was independent. It would 
report to the Secretary, but be independent of the individual 
agencies of the Department. One thing led to another, and we 
passed the Inspector General Act of 1978 under which you 
operate.
    By and large we think it has been working well. The IG's 
office has more than paid its own way, not only in principle, 
but also in cold, hard cash which makes a difference. Your 
office has a good track record of recoveries exceeding 
expenses.
    We appreciate the work that your office does to make sure 
that USDA programs operate well, and we appreciate your success 
in catching a lot of those bad guys out there that would try to 
take advantage of our well-intentioned programs.
    We are looking forward to hearing your testimony this 
morning, but before we begin, I am going to yield to my friend, 
Ms. Kaptur, to see if she has any opening remarks.
    Ms. Kaptur. Thank you, Mr. Chairman and welcome to our 
panel today. Let me say to Ms. Fleischman and your colleague at 
the Inspector General's Office, you certainly hold the respect 
of this Member. As I have noted your work over the years, I 
have always been an advocate that the dollars you recover 
should be yours and not the general Treasury's. I still 
maintain that, and I know that is a difficult road, but I think 
it incentivizes even more activity on your part, and I know you 
can't stretch you resources everywhere that they need to go. 
But on behalf of the American people, I am very grateful for 
your efforts, and I will lobby for Ohio and say if there is 
fraud, abuse, whatever criminal activity, get rid of it.
    So we welcome you to the State of Ohio. Some people won't 
welcome you, but I will welcome you, and look forward to your 
testimony today. Again, thank you all.
    Mr. Bonilla. Thank you, Ms. Kaptur. We have an unusual 
situation this year. It is with sensitive information that may 
be classified or not beneficial to discuss an open hearing. We 
know that there are some areas that the Inspector General's 
Office is working on under these circumstances, and we would 
ask members of the subcommittee to be patient and understanding 
of this. If there is a need for someone on this subcommittee to 
know more, I am sure that you would be more than willing to 
have a classified briefing with them at some point. So we will 
all respect that and hopefully be sensitive to the nature of 
what you are working on.
    We would be delighted to hear from you at this time.

                           OPENING STATEMENT

    Ms. Fleischman. Thank you, Mr. Chairman, Ms. Kaptur. I want 
to say, first of all, that I really appreciate, on behalf of 
the Office of Inspector General, all of your kind words. These 
people in my office around the country and in Ohio, in 
particular, and in Texas, work very hard every day to do the 
right thing for the American people and to make sure that all 
of the money that this committee appropriates, and the Senate 
appropriates to the Department of Agriculture, is spent as it 
should be spent--on the programs that the Congress and the 
administration have deemed worthy to exist. That is our goal. 
That is our mission, and I thank you, again, on behalf of all 
of the people of OIG for your wonderful and kind remarks.
    I am going to cut short my statement this morning. We have 
submitted copies of the general statement to you earlier in the 
week, and with your permission, I know you all were up late 
last night, and hopefully I won't bore you to tears today, but 
I will cut my remarks short, and we can get on with questions 
if you have any.

                       INTRODUCTION OF WITNESSES

    First of all, I would like to introduce my staff, Dick Long 
who is the Assistant Inspector General for Audit who has been 
with the Office of Inspector General for 37 years. I am amazed. 
The man knows more than the Oracle at Delphi; Greg Seybold, who 
is the Assistant Inspector General for Investigations, a past 
master and highly trained and skilled professional 
investigator. We are lucky to have him. And Delmas Thornsbury, 
who keeps us all straight, he is the director of our Resources 
Management Division. As such, he knows where all the dollars 
are and keeps us on our toes and accountable as we spend them.
    This is my first formal appearance before this committee as 
Acting Inspector General. I have been the Deputy Inspector 
General at USDA for some 6 years. It has been my pleasure, and 
frankly, joy to work at USDA. It is one of the most fascinating 
places I have ever been, and I have worked at three other major 
departments.
    I want to thank you for your support to the agency and hope 
we have been able to address some of your concerns. As we say 
every year, and I don't think we can repeat it too often, the 
safety and wholesomeness of agricultural products provided to 
the public and America is our primary concern. Our audits and 
investigations have continually addressed issues related to the 
integrity and security of American agriculture, protection of 
the consumer, and the safety of USDA-operated and-funded 
facilities and their personnel. As such, much of our work has 
been focused on what are now termed Homeland Security issues, 
even before the tragic events of September 11.
    Our work in protecting the Nation's food supply, cyber 
security, disaster programs, production agriculture and 
financial integrity are all part of the broad spectrum of 
ensuring the safety of the agricultural economy and the 
Department's infrastructure.
    The events of September 11 and the subsequent anthrax 
attacks, have given new urgency to issues of security over 
USDA's infrastructure and agricultural economy. Following the 
terrorist attacks on September 11, OIG's special agents 
immediately provided emergency assistance and participated in 
the FBI task force operations in New York City. In addition, 
over 30 special agents were deployed to more than 50 critical 
USDA-operated and-funded facilities, including laboratories and 
research facilities across the country to determine 
vulnerability to attack or compromise by terrorists.
    OIG has helped USDA agencies establish teams of dedicated 
personnel to respond to each emerging crisis. For example, we 
have formed teams at headquarters: an investigator and an 
auditor to work with representatives of each agency to try to 
look for anything that might be a potential target, such as 
infrastructure, or used as a weapon, or possibly fraud against 
USDA programs in order to fund any kind of illegal or terrorist 
activity.
    In addition, OIG has been responding to numerous anthrax 
contamination threats at Federally-inspected meat plants and 
other sensitive USDA facilities. I am happy to say that, to 
date, all of these threats have been hoaxes.
    In the spring of 2001, we began a review of the 
Department's security and controls over biohazardous materials 
at its laboratories. As you well know, several of the 
Department's agencies have a long and continuing program of 
research into disease and pestilence that affect American 
agriculture, whether it is plants or animals. We looked at the 
controls to prevent the inadvertent or intentional release of 
these materials. The Department, at that time, we learned, was 
unaware of the nature, the number and the biosafety risk levels 
of hazardous materials at any of its facilities.
    Moreover, the Department did not have adequate physical 
security at a number of its facilities commensurate with the 
level of risk. The September 11 events suddenly imbued these 
vulnerabilities with a new sense of urgency, particularly given 
the possibility of a terrorist presence in the United States 
and the devastating impact of an intentional release of such 
biohazardous materials on the agricultural economy.
    On September 24, we issued an interim report to the 
Department advising that it needed to take immediate steps to 
identify and compile an inventory of all biohazardous materials 
in its possession. It needed to strengthen management controls 
at all of the facilities that handle such materials. It needed 
to ensure that the materials were adequately accounted for and 
to strengthen and upgrade the physical security at these 
facilities, commensurate with the biosafety risk of the 
materials contained therein.
    The Department, I am pleased to say, responded by quickly 
establishing a task force to draft departmentwide policies and 
procedures on biosecurity requirements for its BSL 3 
laboratories. That is, biosafety level 3, which represents a 
very high level risk and, therefore, should have a very high 
level of security.
    Those policies and procedures address inventory control, 
physical security, personnel security and incident reporting. 
We participated in the task force discussions and provided 
feedback on draft policies and procedures.
    We did not rest there, however. We were concerned whether 
any new inventory and security procedures had been implemented 
at the field level. Sometimes, as we all know, it takes a while 
for decisions made at headquarters to get to field 
installations. But because we were concerned, we dispatched 
approximately 50 auditors to over 100 laboratories nationwide 
in October and November of 2001. In December, we issued another 
interim report to the Department advising that there have been 
no concerted efforts by the agencies to contact the 
laboratories under their control to obtain an inventory of 
biohazardous agents or to ensure that security measures were 
adequate.
    We recommended again that the Department hasten 
implementation of the policies and procedures prepared by its 
biosecurity task force and take immediate action to correct the 
deficiencies at one BSL 3 laboratory. Since then, a number of 
the agencies have compiled inventories and have started to 
evaluate the vulnerability or risk associated with such 
inventories with a goal of implementing additional biosecurity 
measures.
    Since September 11, at the direction of the Attorney 
General of the United States, U.S. attorneys around the country 
have established task forces of Federal and State law 
enforcement agencies to identify and seize sources of funding 
for terrorist groups. We are participating in many of these 
task forces because we know that money from several of our 
current Food Stamp trafficking cases is being transferred 
overseas to foreign bank accounts in countries known to harbor 
terrorists.
    We have moved to halt this type of fraud through aggressive 
use of money laundering and forfeiture statutes and through 
combining our efforts with those of other law enforcement 
agencies. Our goal is to prevent USDA program funds from 
supporting any terrorist operatives, either in the United 
States or overseas.
    Our experiences over the years working with State and local 
law enforcement agencies, especially during Operation Talon, 
have reinforced the benefits that joint Federal, State and 
local cooperative efforts can have in protecting USDA programs 
and resources.
    While first responses will always involve State and local 
agencies, the catastrophic events of September 11 highlighted 
the urgent and increased need for Federal, State and local 
coordination of efforts to protect the Nation's food supply.
    I can't say enough about that. Operation Talon, in my 
estimation, has been one of the most successful operations I 
have ever seen in some 26 years of Government service. We have 
bonded, if you will, with a large number of State and local 
police agencies, as well as social service departments across 
the country. Using our forfeiture funds, we have purchased 
equipment for them that they can use, not only in Operation 
Talon, but in responding to any sort of threat in their 
particular localities and neighborhoods. I am really pleased 
with that, and I think it is one of the greatest benefits I 
have ever seen of asset forfeiture statute authority and work 
between Federal, State, and local law enforcement agencies.
    Recently we met with top USDA officials to emphasize these 
points and to offer OIG's insight and assistance as the 
Department and each of the agencies undertake an assessment of 
their vulnerabilities and the development of solutions for 
these vulnerabilities.
    OIG regional managers are meeting with departmental field 
staff and State and local officials, particularly law 
enforcement and health officials, to alert them and join in a 
concerted effort to protect the agricultural economy and the 
Department's assets.
    Another area of concern for us has been, for a long time, 
computer security. This has been a high priority, and our 
emphasis in this area will continue to increase. As the 
Department continues to expand its use of information 
technology for program and service delivery, this component of 
the USDA infrastructure has become a key element for 
operational integrity and control. Information and related 
systems face unprecedented levels of risk from intentional or 
accidental disruption, disclosure, damage or manipulation.
    The Department has taken positive action through the Office 
of the Chief Information Officer by developing and initiating a 
plan to strengthen USDA information security. However, we 
continue to identify deficiencies at component agencies. We are 
working with both the Chief Financial Officer and the Chief 
Information Officer to correct these problems. As you can well 
imagine, everybody is increasingly concerned that as we put 
more and more, sometimes unique program data, as well as 
financial data, into systems we need to adequately ensure the 
safety and integrity of the data.
    Before I close, however, I would like to highlight an 
initiative we have begun within OIG for which the budget 
request this year would provide critical support. Last summer, 
the senior management team at OIG decided that the agency 
needed to undertake a full review of how we do our business. We 
believe that the agency can achieve greater efficiency in 
carrying out our mission to audit and investigate if we 
streamline our processes and adopt more modern business 
practices. We also believe that we can use state-of-the-art 
information technology to free our people to do more of the 
work that they are uniquely qualified to do.
    To that end, we launched a formal study of our agency that 
will result in a phased strategic plan to equip and train our 
people so that OIG can maintain its historic high levels of 
quality, reliability, production and service in its operations.
    We are beginning this modernization effort with this budget 
with a request for money for information technology and 
training for OIG staff to support these agencywide streamlining 
and cost-cutting efforts, allowing us to work smarter and do 
more with our resources.
    It is my firm belief--and it has been for 20 years or so 
that I have been a supervisor or a manager--that human beings 
have unique capabilities. So far, at least, no machine has been 
developed or made that can begin to equate with the creativity 
and versatility of the human mind. I firmly believe that to the 
extent that any of us, whether it is at OIG or elsewhere, can 
use technology to replace what I think of as administrative or 
almost clerical work done by auditors and investigators, it is 
a good thing, and we need to do it. Human brains should be used 
to do what they do best. Machines should do the other things.
    The events of September 11 have altered all of our lives 
and the course of the work we do. As I discussed earlier, our 
work has always been focused on the protection and enhancement 
of American agriculture, a safe and plentiful food supply for 
our own citizens, and, indeed, for people around the world.
    Since September 11, we have redoubled our efforts and 
worked with the Department to support its and the Government's 
Homeland Security efforts to ensure the Nation's food supply 
and to safeguard America's agricultural infrastructure. This 
concludes my presentation. I appreciate the opportunity to 
appear before you today and would be pleased to respond to any 
questions you may have.
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    Mr. Bonilla. Thank you, Ms. Fleischman. There are a couple 
of logistical items that we are going to deal with this 
morning. I have been notified that we will probably have a vote 
that will be called shortly after 10:00 a.m. I am also a member 
of the Defense Appropriations Subcommittee, and Secretary 
Rumsfeld is testifying across the hallway, so I will probably 
slip out and ask one of my colleagues to fill in for me for a 
few minutes. So that is where I will be, and I will return. But 
we will all get through it, and we appreciate you being here.

                            J-1 VISA PROGRAM

    My first question, Ms. Fleischman, deals with the J-1 visa 
process as it relates to health care in rural areas. We are 
getting a lot of questions about that, not just from my area 
back home but around the country. Under this process, as you 
know, USDA requests the INS to grant waivers from the two-year 
home residency requirement for physicians who agree to serve in 
medically underserved areas. Since 1994, USDA has processed 
over 3,000 waiver requests, primarily for placement in 
Appalachia, the deep south and many rural communities in the 
central States.
    Please outline for us the security concerns related to the 
J-1 visas in the post September world that we now live in, as 
well as any plans for revising or replacing the J-1 program. We 
would appreciate you going as far as you can go in an open 
forum on this issue. This will help us understand the problem 
because, again, we are getting a lot of questions from back 
home.
    Ms. Fleischman. I can appreciate your constituent's 
concerns.
    I think that the J-1 visa waiver program is probably a very 
good program. The problem with the J-1 visa waiver program is 
pervasive through all of the visa programs that the United 
States Government administers. We have been concerned for some 
time because we have open and ongoing investigations in two 
States, one of which is Texas, involving fraud in the J-1 visa 
waiver program. The type of fraud does not involve, to date, as 
far as we are able to learn, any national security threat.
    However, the problem overall is that once these folks have 
gone through the visa process and are here, they go out into 
the communities and there is no mechanism to date for keeping 
track of where they are and trying to make sure they are doing 
what they are supposed to be doing. One of the things that we 
find is that people who are supposed to be providing primary 
care in rural communities to patients are not doing that at 
all. They are off doing something else, and that has caused a 
great deal of concern.
    We have spoken with the Department about our concerns. As 
you know, the Agricultural Research Service controls processing 
of these requests for J-1 visa waivers through the Department 
and then onto the Department of State and the Immigration and 
Naturalization Service.
    ARS has a very limited program. It is not able to keep 
track of where these folks are. INS apparently has not been 
able to do that, either. We have made recommendations to the 
Department of Agriculture, and we have participated in 
discussions with the State Department, with Immigration and 
Naturalization Service, and with others at the Department of 
Justice, on ways to help correct this problem.

                           OIG BUDGET REQUEST

    Mr. Bonilla. I want to move on now to specific budget 
issues. The Federal planning and budgeting process is a long 
and hard one, and sometimes it takes on a life of its own. I am 
sure that program plan for the IG changed an awful lot post 
September 11th. The budget request that is before us was 
formulated to a great degree before September 11th. Do you 
believe that adequate adjustments have been made since then to 
make sure we are providing sufficient resources for the fiscal 
year? Tell us specifically, did you--have you asked for 
anything that has been denied? We want to be sure that your 
more routine audit and investigation activities will continue 
in order to assure program integrity. So please tell us if you 
can whether such activities are being reduced in order to 
provide for new homeland security priority activities.
    Ms. Fleischman. I will answer the latter part of your 
question first. We are continuing, of course, our normal, 
regular, everyday efforts. A lot of the issues that are 
confronting the Department of Agriculture today, post September 
11, that are deemed security issues were issues for us and for 
the Department prior to September 11. The integrity of the 
processes for importing meat, and the processes for keeping 
track of biohazardous materials at laboratories are common 
sense sorts of issues to start with before September 11. And, 
as I said, we had already begun. What we are doing now is 
utilizing our resources to intensify particular kinds of audits 
and investigations. That does not mean that we are unable to do 
the kinds of things which we normally do to ensure the 
integrity, efficiency and productivity of USDA programs. What 
it means is we are intensifying our efforts. To tell you the 
truth, we are working longer and probably a little harder.
    Last summer, even before September 11, we had already 
decided that we should be able to gain some efficiencies and 
economies if we were able to streamline our operations and use 
iformation technology to do some of the work that currently 
people do. I believe if you see fit to fund that initiative--
and we are beginning this year--there will be additional 
requests for equipment and training that we will be able to 
provide our employees with the necessary tools so that they can 
be more efficient.
    Mr. Bonilla. And specifically, I would ask whether you 
requested anything that was denied?
    Ms. Fleischman. No.
    Mr. Bonilla. Very good. Good to hear that.
    Ms. Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman, and we appreciate your 
testimony again, Ms. Fleischman. I wanted to focus on and say 
for the record, the budget that we have received indicates that 
you are requesting approximately a 9 percent increase for the 
Inspector General's activities over the adjusted fiscal year 
2003 level, and as I read what we have been given, less than a 
third of the increase you are asking for, a little over $2 
million, would go to accommodate the pay raise for your 
employees. Another $2,176,000 would go for automatic data 
processing equipment, $963,000 for electronic workpaper, 
software and hardware, and $2 million for oversight of the fire 
service fire plan. My question to you really is--first of all, 
is that correct? Is my reading correct?
    Ms. Fleischman. I think so, yes.
    Mr. Dewhurst. Yes, it is correct.
    Ms. Kaptur. And was that your initial request to OMB?
    Ms. Fleischman. Actually, that is pretty close. I can't 
remember the exact number, but when we made the request of the 
Department, which they approved and it went to OMB, we were 
asking for money for information technology, equipment, 
particularly for audit workpaper software so that machines 
could essentially do some of the routine work that auditors are 
doing right now.
    I believe that some $2 million was added for Forest Service 
oversight. As you know, the Congress has appropriated a lot of 
money to the Forest Service for fire suppression and prevention 
activities. We have already begun looking at those activities, 
specifically how the Forest Service is planning to spend that 
money and how they are actually spending that money now. So we 
will be putting a lot of emphasis on that.

                        INVESTIGATIVE PRIORITIES

    Ms. Kaptur. All right. Let me ask you this. I have read 
through your formal submission as well as the backup documents 
on the budget trying to ascertain where you have been most 
focused over the last year in terms of investigations. I am 
going to ask you what you believe to be the top three 
investigations that your office over the past year has 
conducted, if you would talk a little bit about that.
    Also, I note, as I read through, I don't see any 
investigation relating to the operation of our farm programs, 
because of supplementals that we have passed--I am talking 
about payment streams that go out by the billions across this 
country. Is this in the area that receives audits or any 
attention, because it doesn't seem to be mentioned in your 
formal testimony nor the backup document, and I am just 
wondering if one were to imagine fraud or mismanagement in 
those programs, how that might occur and why it is missing.
    So my first question really is could you focus on the three 
top areas of investigation, and then why the latter one may not 
be mentioned. And how significant it is--or could be.
    Ms. Fleischman. Actually, we do a fair amount of work with 
the farm programs. My colleague tells me some 30 percent of our 
investigative effort is spent in farm programs, and a lot of it 
is on the payment stream and payment limitation cases. We have 
been working in that arena in your State, as a matter of fact--
along with a task force of local and Ohio State law enforcement 
officials--with one of our undercover agents for some time in a 
case that involves a ring of thieves who stole farm equipment 
from farmers in some 12 counties in southern Ohio. The 
equipment was used as collateral for farm loans from the Farm 
Service Agency, and other USDA agencies. I forget how many 
people have been arrested, but some $5 million worth of 
equipment was stolen. We have recovered about a million dollars 
worth of the equipment and are returning it to the farms from 
which it was taken.
    As for the top areas, Food Stamp trafficking is a major 
operation for us in Investigations, and we spend a fair amount 
of time with that. And I think Farm Service Agency programs 
probably come second. I don't know. Greg, what would you say 
would be the other, a third?
    Mr. Seybold. As Ms. Fleischman indicated, the Food Stamp 
Program and fund delivery program to the farms is probably the 
majority of our casework. However----
    Ms. Kaptur. What to the farms?
    Mr. Seybold. The funding for the farms--loans, any proceeds 
going into production for the farms.
    Ms. Kaptur. All right. So our farm payment streams, the 
subsidies, the----

                          LOAN PROGRAMS FRAUD

    Mr. Seybold. Right. What we are now seeing is an increased 
emphasis on fraud in Business and Industry loans from Rural 
Development. We have a significant issue with loans being given 
for development projects in rural areas that are either 
approved through false collateral or false documentation of the 
viability of the project for which the loan was granted. We 
have an emerging issue in Puerto Rico where we believe that 
almost $110 million of Rural Development loans for Business and 
Industry development in Puerto Rico are fraudulent. So that is 
going to be probably an increased emphasis for our office in 
the upcoming year.
    Ms. Kaptur. I guess I have just been handed by our very 
able staff a listing of the results of your investigations from 
1996 to--through 2000. Not 2001. And obviously it appears that 
the Food Nutrition Service gets the bulk of attention.
    Mr. Seybold. Considerable amount.
    Ms. Kaptur. But my question really goes to--and I 
appreciate your clarification here. If one looks at the amount 
of subsidy that we have been putting out there across this 
country, could one conceive of a misuse of those dollars in any 
way, and why do we not see more emphasis there in 
investigations? I mean, it is staggering what we have--it is 
billions.
    Mr. Seybold. Well, any funding program would be susceptible 
to fraud or----
    Ms. Kaptur. Is the payment stream that goes out to 
corporations or entities that are formed to receive Federal 
support dollars for agriculture less susceptible than food 
stamps?
    Mr. Seybold. Those programs that have strong 
accountability, internal controls, and oversight program 
management oversight are probably less vulnerable, but any 
funding program would be vulnerable. I must say this: the 
amount of cases that we are able to conduct, open, pursue, 
apprehend, and bring individuals to justice is determined by 
the number of staff that we have. And, as you know, for the 
past 6 years, we have been in somewhat of a recession as far as 
our staff of special agents. For the past 6 years, our 
statistics have declined and they will continue to decline. I 
mean, I am not going to be dishonest in that statement.
    Now, as Ms. Fleischman has indicated, we have tried to be 
more targeted in our application of law enforcement resources 
in order to investigate cases that have the most significant 
impact to the Department, because we cover the entire spectrum 
of Department activities. So, obviously, since the funding 
mechanisms are the most significant aspect--that and the 
integrity issues that are related to the Department--we devote 
quite a bit of time and effort to that particular priority, 
which would be funding streams.
    Ms. Fleischman. If I could add, we didn't put all of our 
cases in either that thick book that you have or in our 
testimony, but we will be happy to submit for the record, in 
response to your specific question, a listing with summaries of 
all of the cases that we have worked involving farm programs 
and, as you say, the benefit stream for FSA and the Risk 
Management Agency. We will be glad to do that.
    [The information follows:]

    The Office of Inspector General's summary of investigations 
cases involving farm programs and benefit funding streams for 
the Farm Service Agency and the Risk Management Agency is still 
being developed. The summary will be provided to the Committee 
as soon as possible upon completion of the research and 
compilation of the information into a summary format.

    Ms. Kaptur. As we move into the conference committee on the 
new farm bill, you ask yourself what more can we do to try to 
prevent abuse based on your experience, and I know those 
numbers just shot up in terms of Federal subsidy. So you wonder 
what is going on out there with all of these special 
corporations that have been formed to receive money and so 
forth.
    I was going to ask you my usual question on restitution and 
on the dollars received by your Department. How would you 
compare 2000, 2001 in terms of the dollars that you have 
actually recovered and turned over to, I guess, Treasury? Has 
that stayed flat? Has it increased? What is the history? What 
is the recent history of this?

                       RECOVERIES AND COLLECTIONS

    Ms. Fleischman. I don't remember the exact numbers.
    Mr. Seybold. This past year it was $66 million.
    Ms. Kaptur. Was that about even with the prior year.
    Ms. Fleischman. I think so.
    Mr. Thornsbury. It was pretty close to last year, almost 
the same.
    Ms. Fleischman. My recollection is that over the last 5 
years it has ranged between $68 million and $70 million. That 
is about the average for OIG. Some years, we may have a case 
that comes to fruition that is worth, say, $35 million, and 
that will skew the numbers. It is not that we are not glad to 
get the $35 million back, but it sometimes occurs that that is 
the case. But, on average, this office runs right at, I would 
say, between $60-$70 million every year in recoveries.
    Ms. Kaptur. I am going to ask you to provide for the record 
what portion you retain and pass through to other law 
enforcement agencies with whom you work and what portion you 
are able to retain for your own office, if any, and, you know, 
what portion goes to the Treasury of the funds that you 
recover?
    Ms. Fleischman. We will be glad to do that.
    [The information follows:]

    Currently, the agency has no authority to retain funds 
recovered as the result of an investigation. These are returned 
to the General Fund of the U.S. Treasury. On occasion, a 
limited amount of funds recovered through asset forfeiture are 
made available for use by the agency through petition for 
remission; however, these amounts typically represent a small 
fraction of the overall recoveries.

    The majority of money, of course, does go--the majority of 
the funds that we do recover does in fact go to the Treasury or 
to USDA programs. It is returned to the programs. The monies 
that we retain through asset forfeiture and other mechanisms 
are fairly substantial, I think. They can always be greater, 
and like anybody else, we would always like more. Ever since 
Congress gave this office forfeiture authority, I think we have 
been able to use the money as leverage to get assistance from 
both State and locals to work with us in certain kinds of law 
enforcement activities.
    Ms. Kaptur. Thank you. I want to ask our Chairman how you 
would like to proceed here.
    Mr. Bonilla. Well, Ms. Kaptur, if it is acceptable to you, 
we will go vote, and if one of our colleagues shows up, we will 
just allow them to ask the questions of the Inspector General, 
as they show up. If not, we will return as quickly as possible. 
So, take five, and we will see you shortly.
    Ms. Fleischman. Thank you very much.
    Ms. Kaptur. Thank you.
    [Recess.]
    Mr. Latham [presiding]. Good morning. I am Tom Latham, and 
apparently the Chairman will be out for a period of time. So I 
welcome you.
    Ms. Fleischman. Thank you.

                 INFORMATION TECHNOLOGY SYSTEM SECURITY

    Mr. Latham. As awful as events of September 11th were and 
as bad as the anthrax attacks were, we have many other 
vulnerabilities. It seems that one thing we can count on is 
that the next threat will be something that is different from 
what has happened before.
    In this country we rely on information technology to an 
amazing extent. Think about it in terms of your own personal 
finances. When you do your own personal financial accounting, 
how many of your dollars are real green paper dollars? Almost 
none of them. Instead of dollar bills, they are electrons in 
some financial information system somewhere.
    I mention this because I am concerned that the next attack 
on the United States could well be electronic. In your prepared 
remarks with regard to computer security, you say that you have 
identified over 3,300 high- and medium-risk vulnerabilities and 
numerous low-risk vulnerabilities. In general terms, would you 
give us some examples of such vulnerabilities and describe what 
you are doing to fix the problem?
    Ms. Fleischman. Well, frankly, as with almost every problem 
that we see in any venue, the ultimate problem is management 
control and, in this case, access to the accounts. I think that 
people get used to using their computers, and they forget that 
there is a vulnerability. Basically, what it comes down to is 
controls over access, building sufficient firewalls in the 
system to prevent hacking into the system.
    We ourselves have been for the last year and a half or so, 
maybe 2 years now, using very specialized software to test the 
data systems throughout USDA's agencies. This software 
pinpoints specific problems. We have had very good fortune, I 
think, in working with the agencies, and particularly the Chief 
Information Officer, of the Department to identify these 
problems and to develop solutions to the problems.
    That is not to say that problems won't continue. They will, 
and we anticipate that we will be putting even more staff time 
and additional sophisticated software into this arena of 
continuous auditing of USDA data systems, including financial 
systems, and other systems that have unique data on germ plasm, 
such as in laboratories or libraries.
    As I say, we have had good fortune, I think, with the 
agencies and the security staff for the CIO. They have moved to 
correct some of their problems, and they are working on plans 
to correct the remainder.

                          LABORATORY SECURITY

    Mr. Latham. The Department has contracted with Sandia 
National Laboratory to conduct a risk assessment and security 
analysis at all of its biosafety level 3 laboratories. What is 
the timetable for completing this work and to whom will it be 
submitted and will Sandia also perform the second phase of the 
review covering university and private laboratories funded by 
the Department? What is the timetable for performing and 
completing that second phase? If you can tell, we were up till 
3 o'clock this morning.
    Ms. Fleischman. I understand, sir. I am amazed that you all 
are doing as well as you are. I am not sure I could.
    Mr. Latham. That is probably why we have such a great 
attendance here today.
    Ms. Fleischman. Understandable. The contract with Sandia to 
look at USDA's biosafety level 3 labs is almost through Phase 
1. They do not have a final report yet; however, within the 
next month, maybe 6 weeks, a final report will be submitted to 
the Department. As to a specific person to whom the report will 
be addressed, I don't recollect what the contract says, but 
essentially it will be submitted to the Department's Homeland 
Security Council, which is chaired by the Deputy Secretary.
    I believe that there is a proposal for Phase 2 and possibly 
Phase 3. I don't think either one of those has been approved or 
adopted yet by the Department. That was my information as late 
as last Friday. I don't believe review of the universities and 
private laboratories that are funded in whole or in part by 
USDA is part of the proposed Phase 1 or Phase 2.
    However, we have an audit planned to begin in the early 
spring of this year. We will be sending our auditors into those 
laboratories at universities and other private laboratories 
that receive USDA funding for research. We will be looking at 
the security that those laboratories have in place or are 
planning to put into place--physical security, personnel access 
security, inventory control, and so on. The issue is going to 
be addressed, and at Sandia, it is already being addressed.

                        FOREST SERVICE OVERSIGHT

    Mr. Latham. You are requesting an increase of $2 million to 
audit the Forest Service Fire Program. How much did you expend 
over the last several years in prior audits of the Forest 
Service fire suppression efforts? Your justification states 
that you have already made recommendations for improvement in 
fiscal year 2001. Do you believe this program has significant 
problems and requires an annual audit? If so, is $2 million the 
annual cost to perform this work, or is it a one-time cost?
    Ms. Fleischman. I believe that it is a one-time cost; 
however, if higher levels of funding are provided to the Forest 
Service for its plan, increased audit coverage may be needed. 
In FY 2001, Congress appropriated an additional $1.1 billion to 
the Forest Service to manage its wildland fire program. We are 
going to try to complete a detailed, full audit of the money 
that the Congress appropriated to the Forest Service to ensure 
that the objectives of the plan are attained. There is a great 
deal of interest, as you know, about how the Forest Service has 
been expending money for fire prevention and fire suppression. 
We believe that we need to devote a fair amount of resources to 
this issue, because the Forest Service is receiving so much 
money, and there has been a tremendous amount of interest, both 
in the Congress and in the administration, that the expenditure 
of this money be monitored very carefully. And, we plan to do 
just that.
    Mr. Latham. Yesterday when we had the Secretary here, the 
case up in the Northwest was discussed where some Forest 
Service employees were involved with phonying up an endangered 
species claim with lynxes. Were you involved with that?
    Ms. Fleischman. Yes.
    Mr. Latham. Can you tell us about that?
    Ms. Fleischman. We have an ongoing investigation of the 
issues that have been raised as to whether or not Forest 
Service employees intentionally--according to the newspapers--
doctored samples of lynx or fur that purported to be Canadian 
lynx fur. That investigation is open and ongoing.
    Mr. Latham. Can you give us an update as to where that 
investigation is or what kind of penalties would be involved?
    Ms. Fleischman. I don't think so. Typically when we are 
conducting investigations and expending special agent time, it 
is under the premise that it is potentially a criminal matter, 
and so consequently, all of the safeguards and the requirements 
come into play. I am hopeful that we will have completed the 
investigation in the next few weeks. We will, of course, submit 
what we find to the appropriate United States attorney's office 
for a reading by them as to what they think of the evidence, 
and we will be happy to let you know at the conclusion of that 
where we are.
    Mr. Latham. Are you looking at just this case, or are you 
looking to see whether it is widespread or systemic in the 
Forest Service?
    Ms. Fleischman. My understanding is that the General 
Accounting Office has been asked by the House Resources 
Committee to look at the overall management of such studies, 
endangered species studies inside the Forest Service, and 
probably the U.S. Department of the Interior, as well. We have 
not initiated an overall examination of all of Forest Service's 
procedures. I think, though, if the GAO is not doing it, then I 
think we may very well take a look ourselves, but my 
understanding is that they have already begun or they are about 
to begin such a review.
    Mr. Latham. Well, that really undermines the credibility of 
the entire service, and it is unbelievable, as far as I am 
concerned.
    Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman, and I apologize for 
being late this morning and in missing your opening 
presentation.

               ANIMAL AND PLANT HEALTH INSPECTION SERVICE

    Let me ask a couple questions. The first one would have to 
do with APHIS, and I know that there are many of us that have 
recognized that in the last decade or so as we crank down on a 
lot of the agencies, that APHIS was one of those that was put 
in a position of not having the adequate resources, staffing, 
and training to meet the increased demand. At the same time we 
were cranking down, we were opening our borders and, thus, 
continued to be a problem in the Department of Agriculture in 
fulfilling their responsibilities.
    Could you comment about your office and what you are doing 
to help APHIS do a better job of controlling the flow of pests 
and other problems that might exist like that?
    Ms. Fleischman. Well, I think that first of all, you are 
right. The amount of imported goods into this country is 
increasing at an incredibly rapid rate. One of the things that 
comes with global trade is a lot of imports, and hopefully a 
lot of exports, particularly with agricultural products.
    We have worked with APHIS on a number of occasions in a 
number of different audits, including one we have ongoing right 
now where we are looking at how APHIS applies its decisions as 
to how much staff is needed and where they are needed across 
the country, not only at ports of entry but all of the other 
activities that APHIS is responsible for.
    We are hopeful that we will be able to provide some 
recommendations on how they might better analyze their need for 
staff, what kinds of staff in various programs, and how they 
can shift staff so as to be able to operate in a more efficient 
fashion.
    Agencies like APHIS, need to be able to move staff fairly 
quickly. That is a hard thing for Federal agencies to do. 
Consequently, we are hoping that we will be able to provide 
them with some advice and recommendations on how they might be 
able to position staff so they can move them quickly from place 
to place where an emergency need emerges and they have to go 
there immediately, rather than wait.
    We are looking at what APHIS does when they bring new 
employees on board. One of the problems that we have found is 
that APHIS does not or has not in the past--hopefully this is 
going to change--been able to conduct the background 
investigations that are needed for people on APHIS' staff that 
work in areas that have a lot of security, such as in 
international airports. In our audit, we discovered one 
employee who had been going into secured areas of Miami 
International Airport for over 280 days and he had not even 
submitted his form for a background security check. Those kinds 
of audits will be helpful to APHIS.
    Along with the increase in imports into the United States, 
we also have an increase of goods being smuggled into the 
United States, particularly vegetable and fruit matter, and 
some animal matter. It is an incredible amount of agricultural 
product. We have partnered with APHIS, and do work with APHIS 
in various places around the country, particularly at 
international ports, with regard to ``smuggling for profit.'' 
One category of smuggling includes the people who forget that 
they didn't eat their apple for lunch in an incoming flight and 
they have it in their pocket or purse. Some people will bring 
back some samples of the wonderful types of fruit from a 
foreign country for their personal enjoyment. These are not 
criminals. These are folks who are trying to share something 
they thought was really good with their families or neighbors. 
But we do see a fair amount of smuggling-for-profit people who 
are bringing in large quantities--60,000 to 100,000 pounds--of 
various kinds of fruit that are not allowed into the United 
States that they are planning to sell and distribute. So we are 
working with APHIS in an attempt to stop those people.
    I think this is a good opportunity for cooperation between 
the agencies, and I expect it to continue and, hopefully, to 
increase.
    Mr. Boyd. Mr. Chairman, may I follow up?
    Mr. Latham. Certainly.
    Mr. Boyd. To follow up on that, I know that the Secretary 
touched on this same area yesterday. The resulting problem of 
this trend is that we are now beginning to see major economic 
damage to our farm community. The offshoot of that damage is we 
are beginning to spend a lot of taxpayer dollars to fight these 
emergencies.
    I was very interested in the figures that the Secretary 
threw out yesterday. About 4 years ago, we were spending less 
than $50 million a year on emergencies. I am paraphrasing these 
numbers because I don't remember the exact figures, but I think 
for the fiscal year we are in, we are expected to spend $300 
million on so-called emergencies created by our lack of border 
control.
    So it is an area, Mr. Chairman, that we really need to 
focus on. We have not done a good job, and it threatens our 
production in agriculture in America, without a doubt. I know 
the members here have heard me, Ms. Fleischman, say this many 
times, but we have a $9 billion industry in Florida that is in 
big trouble right now because of one citrus tree that came in 
through the Miami International Airport. We haven't done a very 
good job as a Federal Government or a State government on 
responding to that. We have all kinds of legal problems down 
there now and cities suing us. Mr. Long, you know all about it, 
don't you?
    Mr. Long. I do.
    Ms. Fleischman. To our sorrow.

                 IMPROVED TECHNOLOGY AND COMMUNICATIONS

    Mr. Boyd. I didn't have a chance to talk with the Secretary 
about that yesterday, so I wanted to make sure that the 
Department knows that we need help here.
    Let me ask you one question. Technology, isn't that 
something that we can do a better job of utilizing in assisting 
our APHIS people in doing their job? If we are going to have 
less people, less staff, can't we at least improve our 
technology as we go along to do a better job?
    Ms. Fleischman. Absolutely.
    Mr. Boyd. Are we doing that?
    Ms. Fleischman. There is an attempt--an effort is underway 
for APHIS and FSIS with respect to imported meat with APHIS and 
the U.S. Customs Service and other Federal border law 
enforcement agencies, to make sure that the exchange of 
information by computer takes place and is accurate and 
efficient. Real-time information is absolutely critical. APHIS 
needs to know from Customs immediately, or as soon as possible, 
what the manifest is, what is coming into this country, so that 
they can be there to do the inspection.
    I think that a wise use of computer systems--data 
information systems--particularly compatible systems so that 
the information can flow quickly and in real time, would be a 
great help to APHIS and the other border law enforcement 
agencies.
    I have only mentioned Federal law enforcement agencies. As 
you know, because I think we have talked to you about this 
before, we have had an agricultural law enforcement pilot 
project with the State of Florida, and we have conducted a 
number of activities together. In fact, one of the things that 
we have done is to use our forfeiture money to buy computers 
and to pay for certain overtime for Florida local and State law 
enforcement personnel in an effort to bind Federal law 
enforcement together with State and local law enforcement. It 
is obvious that none of us are ever going to have sufficient 
resources to do this very large job that is continuing to grow, 
and one of the things that we in our office have pushed, and we 
will continue to talk about, is a higher degree of cooperation 
and shared work between State law enforcement, local law 
enforcement, and Federal law enforcement, particularly in this 
area.
    We are also working in the State of California. These 
obviously are the two big agricultural States that are in some 
ways most susceptible. But nobody should misunderstand, the 
crops that are grown in cold weather regions in this country 
have their own susceptibilities to certain kinds of diseases 
and pests that can come into this country as well. This is not 
just a problem for those States like California and Florida. It 
affects virtually all agriculture in the United States.
    Mr. Boyd. Thank you, Mr. Chairman. I will conclude. But I 
just want to make sure that the committee understands that this 
Member wants to focus on this problem. This whole issue of 
invasive pests and the economic damage it is doing to us is 
pretty severe.
    Ms. Kaptur talked about the Asian longhorn beetle 
yesterday. That has a potential of being a major disaster for 
us around the country. The State Department of Agriculture is 
fighting some 35 or 40 invasive pests which are currently 
active on their list now. This is going to be an issue that we 
really need to develop a broader and better strategy on. Just 
being reactive and throwing money at the emergency once it 
occurs is not a long term solution. So thank you, Mr. Chairman.
    Mr. Latham. If you have anything else, I don't think we are 
going to do another round, so if you would like to--if you had 
any other questions now.

                          CROP INSURANCE FRAUD

    Mr. Boyd. I do have one question, and that is on the ag 
Risk Protection Act of 2000. As you know, there were some 
fairly dramatic changes that we made in terms of having the 
farmers themselves police the crop insurance side. Can you 
speak to that and how it appears to be working and unfolding, 
or are you familiar with that?
    Ms. Fleischman. Yes. We are very familiar with that, and as 
soon as the----
    Mr. Boyd. Before you start, let me say that I think 
everybody understands, that crop insurance is very difficult to 
design in a way that people can't take advantage of it.
    In the old days, you know, all of us who were in the 
farming industry knew that there were folks around the 
community that would plant crops just to get the insurance 
money. I think that is what some folks tried to do. I think the 
authorizers, Mr. Chambliss and others who developed that 
legislation, tried to prevent that, and I would like for you to 
speak to that.
    Ms. Fleischman. When the law was passed, we worked with RMA 
to try to set up procedures. Every statute requires the 
implementing agency, of course, to put in place regulations and 
guidance and procedures for how the particular statute is going 
to work. So we worked with them to get that done. It is not in 
my short statement, but I think in the long statement and 
possibly in the book that you have there, we are initiating 
this year an audit to see how this is going. The law and the 
regulations have not been in effect long enough to have a good 
statistical sample to make a clear judgment on how it is going. 
The Congress worked hard to try to get a number of improvements 
in the RMA program. We will be auditing program implementation, 
and we will make a special point to send you a copy of the 
report.
    [The information follows:]

    The Office of Inspector General's audit report on the 
Agricultural Risk Protection Act of 2000 is expected to be 
issued in December 2002. A copy of the report will be provided 
to the Committee at that time.

    Mr. Boyd. Thank you very much. Thank you, Mr. Chairman.
    Mr. Latham. Thank you, Mr. Boyd.
    Ms. Kaptur.

                            INVASIVE SPECIES

    Ms. Kaptur. Thank you, Mr. Chairman, very much. I just 
wanted to follow on Mr. Boyd's questions, because we share a 
deep interest in this issue of invasive species. And while I 
was a little late in getting back here because one of our 
colleagues was asking my advice--he has to be involved in the 
screening of the hiring of an attorney for a new commission 
that is being set up here in Congress, and this commission is 
going to make certain recommendations to us. He said, Marcy, 
what questions should I ask the candidates who are interviewing 
for the position? And I gave him a general answer, because the 
nations we would be dealing with do not have our rule of law 
nor our transparency in business.
    I brought up the issue of the Asian longhorn beetle because 
I said, look, I can talk conceptually about the differences 
between the way we operate. I said, but here's a practical 
legal problem. We know which country that thing came from, and 
now we are asking our taxpayers to pay the costs of 
remediation. How do we get those who are responsible for doing 
this to pay the costs? How do we do that through the WTO or--
because unless you make people take responsibility, we are 
going to continue being invaded, and there has to be some 
mechanism in the international marketplace.
    This is what I asked the Secretary to think about 
yesterday. If you have any recommendations, knowing everything 
you know from the audit streams that you have worked with over 
the years, of how we could insert amendments or make 
suggestions. This affects every country in the world that we 
deal with where we bring product in here, and if something goes 
haywire, we tax ourselves. It is a very convoluted system, and 
the rate of increase is exponential.
    I am extremely worried, as you are, about our citrus 
industry, about our hardwoods. Just one industry in Ohio, our 
maple sugar industry, they are in cardiac arrest just waiting 
for these things to come over the border, and we don't have a 
proper legal mechanism to deal with this in the way we 
understand those here in our country. When there isn't a tort 
system, what do you do? And so we have to be a voice in these 
international trade forums to try to figure out how to track 
the damage where we can, or to track the perpetrators, either 
knowingly or unknowingly, but basically pay the damages. If you 
are going to do this, you have got to pay for it. That will 
exact some sort of regiment, I think, in the international 
realm.
    If I were to ask you to provide to the record which 
nations--maybe APHIS could identify this for us. If we look at 
the problems we have in the ecosystem in this country now 
because of these invasive species, can you give us a listing of 
countries? Can you track, where these things have come from or 
where these conditions exist the most likely--places where you 
are certain, places where it could be? Do you have the ability 
to do that?
    Ms. Fleischman. I don't know that we could do that, but 
APHIS, I am reasonably confident, could tell you. They know the 
sources of or places where these pests and/or diseases occur.
    For our part, we typically are not operating overseas. 
APHIS has people who work in countries across the world. We 
don't do that. What we see primarily are the people who are 
smuggling for profit, and they are usually, but not always, 
American citizens. Depending on the market that they are 
intending to serve, they can bring in things from all over the 
world. APHIS does have a list of countries from which nothing 
is supposed to come in, so my suggestion is that you might ask 
APHIS for that. We can ask them for you if you would like, but 
I know we don't have that specific list.
    Ms. Kaptur. Well, I certainly would appreciate it. I know I 
asked them a question last year on this, but we actually need 
to take a look at it in this form. We need to look at the 
various pests, the various disease problems we have now. We 
need to see the most likely countries from which those 
originated. We need to grapple with this at a policy level 
here. And I am looking to you for recommendations, assuming we 
know the Asian longhorn beetle came from China. We know that. 
So what do we do, knowing everything you know? Think about 
that.
    We will provide a question to the record. Make some 
suggestions to us.
    [The information follows:]
    [Clerk's note: The attachments were deemed too lengthy for 
printing and have been retained in Committee files.]

    Additional information regarding plant and animal imports 
form restricted countries can be found in the Code of Federal 
Regulations, Title 7, Section 300-399 for plants and in Title 
9, Section 1-199 for animals.

    Mr. Boyd. Would the gentlewoman yield?
    Ms. Kaptur. I would be pleased to yield to the gentleman.

                PENALTIES FOR SMUGGLING AND PEST DAMAGE

    Mr. Boyd. Maybe one of the problems is that there are 
really no international laws broken, and so it makes it 
difficult. I am not an expert in this field or an attorney, but 
maybe there is somebody on your staff that could address that. 
If there is not, then how do we develop some sort of broad 
strategy to address this issue in the international community? 
You know, there are some international entities and agencies 
like Interpol who have the ability to do the investigative work 
if we had the right strategy in place. Can you address that? I 
mean, maybe there is somebody that knows how we would develop 
that strategy.
    Ms. Fleischman. Well, I am not sure that we have the 
expertise in international law. I think that might be addressed 
within USDA certainly, by the General Counsel's Office or 
Foreign Agricultural Service. One of the things that we have 
seen is that smugglers for profit are repeat offenders. They 
are people that APHIS has caught and has fined them 
administratively, sometimes even civilly, but there is no real 
major felony statute in the U.S. Code that we can use, or that 
U.S. Attorneys can use.
    So we have strongly advocated, given the world that we work 
in, two things. One, we think we need a felony statute for 
smugglers for profit who are essentially repeat offenders. They 
are coming in here with smuggled goods time after time after 
time.
    And the second thing we need to address is, no matter how 
big the fine, in a sense, they have resources left to continue 
their smuggling. We believe that the United States Government 
should have a forfeiture authority for these kinds of people so 
the Government takes the warehouses; we take everything that 
they have used to further their criminal activity. There are so 
many things that we can do, but those are two of them for sure.
    Outside this country, that is a matter of international 
law, and I don't think that we have the expertise to address 
that issue. But I think you are right. It is one that probably 
needs to be addressed.
    Mr. Boyd. Mr. Chairman?
    Mr. Latham. Yes, sir?
    Mr. Boyd. May I?
    Mr. Latham. Sure. Ms. Kaptur has some----.
    Mr. Boyd. Yes. I asked the gentlelady to yield.
    Maybe it would be helpful to us if you could make a 
recommendation to the Secretary to address those 
recommendations in a letter, if there is something that we can 
do statutorily. I would like to request that you do that, that 
you get us a letter and make those recommendations to us so we 
can take action if necessary.
    Ms. Fleischman. We will do so.
    [The information follows:]

    The current version of the Farm Bill (H.R. 2646) includes 
Sec. 1068, Penalties for Violations of Plant Protection Act. 
This provision contains language regarding felony charges for 
certain violations of the Plant Protection Act. OIG supports 
the language and deems it helpful in deterring smuggling for 
profit and the introduction of invasive species.

    Mr. Boyd. Thank you.

                     PORK PRODUCER CHECKOFF PROGRAM

    Ms. Kaptur. It is a very helpful suggestion.
    I wanted to change the topic for a second. I know we are 
going to have a vote here before long. In the 2002 
appropriation bill, we included a provision which prohibited 
the use of departmental funds to maintain, implement or modify 
a pork producer checkoff program that has not been approved by 
a vote of the producers. What has your office already done, or 
what can your office do to monitor the Department's compliance 
with this provision?
    Ms. Fleischman. We have not initiated work in that arena 
yet, but obviously this is a concern of the committee, and we 
will initiate a review to see how they do that.

                         FOOD SAFETY PRIORITIES

    Ms. Kaptur. Thank you very much. Let me also ask, in the 
area of food safety, based on all of the work that you have 
done and the oversight you have done, what is the single most 
important action this subcommittee could take to help USDA 
perform its food safety responsibilities more efficiently?
    Ms. Fleischman. Well, I am not sure that I could give a 
really good answer to that off the top of my head. I haven't 
thought about that. But we will think about that and submit an 
answer for the record.
    [The information follows:]

    Two things come to mind. In June 2000, OIG issued a report 
on FSIS' District Enforcement Operations compliance activities. 
We found that FSIS did not have sufficient enforcement actions 
available to it to deter non-Federally inspected firms from 
committing additional violations of meat and poultry inspection 
laws. Non-Federally inspected firms would include retailers, 
warehouses, distributors, and custom slaughter plants that 
handle meat and poultry products. We recommended that FSIS 
continue to seek the authority to assess civil monetary 
penalties against firms that commit violations of meat and 
poultry inspection laws. We continue to support the need for 
this authority, which would require legislation.
    Second, in July 2001, OIG issued a report detailing areas 
where APHIS and FSIS needed more stringent controls to ensure 
that meat products entering the United States were free of foot 
and mouth disease. APHIS did not adequately keep track of 
imports that were on hold and awaiting release from ports. This 
occurred because port personnel kept manual records of imports, 
there was no central automated system that controlled imports 
entering U.S. ports of entry through to the point of 
disposition, and there was no reconciliation performed between 
APHIS and FSIS records to ensure that all shipments recorded as 
having been sent to FSIS inspection houses were identified. We 
recommended that the two agencies develop an automated system 
to provide control and accountability of imports entering U.S. 
ports of entry through their disposition. The agencies have 
agreed to this and are in the process of developing systems to 
address our recommendation.

    Ms. Kaptur. All right. And we will also submit a question 
about the safety of the school food programs. We have, 
obviously, information about contaminated poultry products that 
reached over 47 school districts in California or 47 school 
districts, and so both in the area of general food safety and 
school nutrition, we will welcome your thoughts there.

                         THREATS TO SEED STOCKS

    Another very different area, I have been very interested 
always in the seed supplies that the U.S. Department of 
Agriculture maintains as well as other entities. Do you feel 
very serious threats to these supplies, and what have you done 
with respect to assessing the security of our seed stocks and 
any improvements that need to be made?
    Ms. Fleischman. Part of our ongoing review of security for 
facilities and assets in the Department of Agriculture includes 
those kinds of things, seed stocks, germ plasm, libraries. It 
is absolutely critical. These are some of the most important 
assets that USDA holds for the Nation. And, consequently, we 
are looking at these situations to satisfy ourselves and 
everybody else that they are protected and that there is no 
chance that they can be compromised in any way.
    Ms. Kaptur. Thank you, Mr. Chairman, I will have other 
questions for the record, but that is all I have this morning, 
and again, I just wanted to thank our witnesses so very, very 
much for being here.

                    THREATS TO LIVESTOCK AND PLANTS

    Mr. Latham. Thank you, Ms. Kaptur. I will just follow up. 
The threat does not only affect plants. We have the livestock 
industry--you talk about a group of people holding their breath 
that a disaster doesn't happen tomorrow and basically wipe out 
the industry. There are a lot of different threats out there. 
We have bioterrorism. We have threats from some real radical 
groups that want to bring foot and mouth disease or mad cow or 
something and infect animals here in the U.S. There are all 
kinds of bioterrorism concerns.

                        INTERAGENCY COOPERATION

    This brings me to another issue. I also serve on the 
Commerce, Justice, State, Subcommittee and talk a lot about 
immigration and border patrol. I guess my question to you would 
be do we have a good working relationship, and cooperation 
between USDA officials at the borders and the DEA folks, the 
Border Patrol folks, the INS people? A lot of us have real 
concerns that, one person can check individuals' IDs but can't 
look in the vehicle. The other one can look in the trunk but 
can't look in the glove compartment. I mean, it just seems 
almost dysfunctional.
    I wonder if there is cooperation so that if a DEA employee 
finds something, does he tell the USDA person that there is 
some fruit back there? Does he--because the beagle doesn't find 
drugs. I mean, is it okay to have apples in the trunk? I just 
wonder what kind of coordination there is, and if there is any 
insight or recommendations you could give us as far as securing 
our borders. Again, it is plants, it is animals, it is all 
kinds of different threats that we have.
    Ms. Fleischman. That was a very good question.
    Mr. Latham. Thank you. That is very nice.
    Ms. Fleischman. The reason I say that is because it is a 
subject that we have been involved with for a long time, and 
our office, as some others in USDA, have been concerned and 
worried for a long time about the possibility of a disaster 
befalling American agriculture, whether it be some sort of 
intentionally inflicted harm or inadvertent harm.
    The degree of cooperation, I think, with the border law 
enforcement agencies, like every other issue, varies depending 
on where you are, and, to some extent, it varies with 
personality. And that is human nature. That is the way that is.
    I think that in some situations, there is a very high 
degree of cooperation and transferring of information in a 
timely manner. One of the things, however, that we have learned 
and realized since September 11, in worse than graphic terms in 
some ways, is the degree to which we do not share information 
as quickly, as readily, as we should. And I have had the good 
fortune to work with folks the last several weeks about what we 
call ``horizontal information sharing.'' There are a number of 
impediments to this, not the least of which is compatibility of 
computer systems, data systems. They are not always in a format 
so that information can be readily shared, and that is a hurdle 
that I think that we are going to have to overcome.
    Mr. Latham. That is true even inside USDA, isn't it?
    Ms. Fleischman. That is exactly right.
    Mr. Latham. I mean, we are not talking about Customs and--
--

                     COMPUTER SYSTEMS COMPATIBILITY

    Ms. Fleischman. That is exactly right. I have mentioned 
this issue when I was asked to go talk to the Homeland Security 
Council folks. I said that this is not a problem that is unique 
to border information. This is a problem that we face inside 
USDA, and other departments have the same sort of problem. But 
we need to go about this in a logical and purposeful way. We 
know that we do need to share information. I think that we know 
that we need to share it in a timely manner--what I think of as 
a real-time world. Because you don't have time to spare. Once a 
person or something enters the United States, this is a big 
country, he or she gets hard to find. And the thing, whether it 
is a bag of fruit or 600,000 pounds of fruit, gets hard to find 
it is like hunting down a needle in a haystack. So the idea is 
to stop it at the border if you possibly can, and stop it even 
before it gets to the border if you can do that.
    But we need to approach this problem and identify what are 
our goals, what are the impediments--as I say again, one of the 
most difficult ones is the inability for the various computer 
systems and networks to talk to each other. We are going to 
have to reformat our computer data systems, and we are going to 
have to train people to use them, to use the information for 
each of our respective purposes, which ultimately is one 
purpose, one goal.
    I think that that would be a good place to start. We did an 
audit of APHIS and the Food Safety and Inspection Service last 
summer. They are supposed to work together, and they do work 
together, at ports of entry regarding imported meat. APHIS has 
embargoed countries lists. FMD, of course, at the time was 
raging in the United Kingdom and there were outbreaks in South 
America. But one problem that we found, the thing that impeded 
the ability of the two agencies to do their respective jobs 
completely and thoroughly, was they didn't talk to each other. 
The communication would not occur at times. They, like ships, 
do sort of pass each other in the night and don't connect, so 
to speak.
    It is not intentional. Each group of people would get so 
busy doing what they were doing, and they are working in 
facilities that are enormous containers coming off ships at a 
rate of hundreds a day. It is a busy, challenging place to 
work.
    That was our primary recommendation, and all of the 
subsidiary recommendations really had to do with 
communications, making systems compatible, if at all possible, 
and making sure that each set of APHIS and FSIS employees at 
the ports are following the same set of protocols, the same 
rules. I think that applies, frankly, across the Nation.
    Mr. Latham. Has there been any directive from the 
Secretary, whether this one or previous ones telling people 
that part of their job is to talk to other agencies inside the 
Department. I would hope that they would talk to each other. 
The border is our frontline defense, and if you have USDA folks 
that won't talk to Customs, who will not talk to INS, who will 
not talk to Border Patrol, I mean, there are a lot of folks who 
think we ought to just basically have one agency in charge of 
the border so that we don't have this communication problem.
    Ms. Fleischman. Well, I am not so sure that one agency 
would do it, frankly.
    Mr. Latham. Well, we don't need five or six agencies.
    Ms. Fleischman. I understand, sir. The issue is not always 
a matter of turf. It does have to do, in large part with 
people. They get really busy and they are very focused on what 
their particular task happens to be.
    As a result of the audit work that we did last summer, the 
respective Under Secretaries and the agencies have moved, and 
they have issued instructions to their employees, in effect 
telling them to talk to each other, and addressing the systems 
problems of computers that are formatted in different ways. 
Information is not easily shared in a timely manner. They are 
addressing the problem and will continue, because it is one of 
the big issues for USDA. We will continue to monitor what they 
are doing, because it is absolutely critical that they do it.
    Mr. Latham. Do you have any other questions?
    Ms. Kaptur. I have no questions.
    Mr. Latham. Mr. Boyd?
    Okay. I would like to thank you very much for your 
testimony here. We rely on your information and your 
recommendations a great deal. It is very important to us, and 
we appreciate the job you do. Thank you for testifying, and we 
are adjourned.

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                           W I T N E S S E S

                              ----------                              
                                                                   Page
Collins, Keith...................................................     1
Dewhurst, S.B....................................................

1, 1055

Fleischman, J.N..................................................  1055
Gallegos, Lou....................................................   303
Herglotz, Kevin..................................................   907
Hobbs, I.L.......................................................   617
Kelly, J.M.......................................................   797
Long, R.D........................................................  1055
McPherson, Edward................................................   449
Moseley, J.R.....................................................     1
Seybold, G.S.....................................................  1055
Smith, N.L.......................................................   965
Thornsbury, D.R..................................................  1055
Veneman, A.M.....................................................     1


                               I N D E X

                              ----------                              

                        Secretary of Agriculture

                                                                   Page
ADP CAP Impact on Service Center Modernization Plan..............   142
Adverse Effect Wage Rates........................................   218
Advisory Committees..............................................   121
Agricultural Credit Insurance Fund...............................   143
Agricultural Marketing Service...................................   181
Agricultural Research Service....................................   287
Agricultural Trade Positions.....................................   206
Ames Laboratory..................................................   258
Animal and Plant Health Inspection Service (APHIS):
    Animal And Plant Eradication.................................   203
    Animal Waste Management......................................    51
    Anibiotic Resistance.........................................   176
    Bioterrorism.................................................   281
    CCC Emergency Funding........................................    37
    Eradication Program, Burden Sharing..........................   180
Appropriations, Unauthorized.....................................   163
Biobased Products Research.......................................   148
Biocontainment Research Facilities...............................   259
Bioenergy and Ethanol............................................   224
Biofuels Program................................................88, 244
Biographies:
    Moseley, Jim.................................................    33
    Veneman, Ann M...............................................    32
Biosecurity......................................................   231
Biotechnology Risk Management....................................   147
Bioterrorism.....................................................   152
Bovine Spongiform Encephalopathy (BSE)....................232, 260, 282
BSE News Releases.........................................233, 261, 283
Budget Request, Adequacy of......................................   287
CCC Funds, Use of................................................   180
Chicken Products, Emergency/Bonus Buy for........................    59
Chief Information Officer........................................   141
Civil Rights.....................................................   267
Codex Alimentarius...............................................   131
Commodity Production.............................................    79
Common Computing Environment..............................142, 158, 205
Congressional Earmarks...........................................34, 71
Congressional Relations Activities..............................94, 206
Conservation Programs.....................................5, 50, 73, 80
Contracting Out..................................................   184
Corporate Systems Investments....................................   205
Crosscuts........................................................   214
CRP Technical Assistance.........................................   139
CSFP:
    Administrative Funding Formula...............................   265
    Elderly Eligibility for......................................   265
    Use of Inventory to Support CSFP Caseload....................   264
Cuba, Trade With.................................................56, 57
Dairy Options Pilot Program......................................   131
Delinquent Loans.................................................    97
Departmental Management..........................................     6
Departmentwide Disaster Recovery Plan............................   211
Domestic Lamb Prices.............................................   187
Eradication Program, Burden Sharing..............................   180
FARM Bill:
    Legislation.................................................. 3, 45
    Payment Limitation...........................................    78
    Provisions...................................................61, 74
    Spending.....................................................   209
Farm and Foreign Agricultural Services...........................     4
Farmers' Market Programs.....................................67, 74, 81
Farmland Consolidation...........................................    49
Farmland Protection Program......................................    43
Farm Loans.......................................................   145
Farm Policy......................................................   220
Farm Service Agency Administrative Funding.......................   142
Farm Service Agency Information Technology.......................   209
Food Assistance Policy Council...................................   237
Food and Nutrition Service....................................... 5, 72
Food and Nutrition Service Staffing Levels.......................   276
Food Safety:
    Food Safety........................................41, 46, 228, 248
    GAO Report on HIMP...........................................   249
    New Release--Increase Funding................................   229
    Research.....................................................   255
    Resources....................................................   269
    Standards....................................................    47
Food Stamp Program:
    Application Process, Simplification of.......................   267
    Benefits, Indexing for Inflation.............................   265
    Benefits, Transitional.......................................   267
    Estimates of Eligible Non-Participants in the Program........   154
    Facilitating Access to the Program.........................154, 274
    Legislative Proposals........................................   175
    Participation.........................................154, 157, 180
    Recertification Rules, Simplifying...........................   266
    Reducing Error Rates.........................................   156
Food Assistance, U.S. Foreign..................................236, 241
Foot and Mouth Disease...........................................    43
Foreign Agricultural Service Personnel...........................   264
Foreign Trade....................................................   223
Fund for Rural America....................................129, 134, 301
FY 2003 Budget Submission........................................36, 66
FY 2003 Budget Increases/Decreases...............................   167
GIPSA User Fees..................................................   181
Glassy-winged Sharpshooter...............................57, 59, 76, 77
Global Food for Education..................................87, 187, 241
GSA Rental Costs.................................................   185
Homeland Security:
    Council......................................................    42
    Protecting Food Supply.....................................176, 178
    Supplemental..........................................178, 185, 269
Human Nutrition Initiative Studies...............................   149
Import Inspections.............................................276, 281
Infrastructure...................................................     3
International Food Assistance....................................    82
International Programs Budget....................................   179
International Trade..............................................    62
Introduction of Witnesses........................................     1
Irradiated Foods in the Child Nutrition Program..................   254
J-1 Visa Process.................................................   212
J-1 VISA Waiver Program Participation--Fact Sheet................   213
Karnal Bunt......................................................   129
Lamb Direct Payment Program......................................    65
Lapsed Positions.................................................   161
Legal Services Contract..........................................   124
Listeria Monocytogenes.........................................259, 274
Loans............................................................    98
Lynx Incident in the Northwest...................................    71
Mandatory Price Reporting........................................   157
Mandatory Recall.................................................   272
Meat, Poultry, and Egg Products Inspection, Fees for.............   183
Methyl Bromide...................................................    58
National Animal Disease Center, Ames, Iowa.......................    48
National Finance Center Disaster Recovery Plans..................   210
National Marine Sanctuary........................................    56
National Organic Standard Program................................   157
Nutrition Education..............................................   173
Office of the Secretary:
    Budget Justification Materials...............................   288
    Homeland Security............................................   205
    Office of the Secretary......................................   288
    Program Increases............................................   203
    Staffing.....................................................   104
    Streamlining.................................................   204
    Unobligated Balance..........................................   203
Opening Remarks..................................................     2
Outreach for Socially Disadvantaged Farmers......................   161
Overhead Costs, Reduced..........................................   209
Overseas Markets, Expanding......................................   173
Payments to Farmers..............................................    64
Peanut Program...................................................    59
Pest and Disease:
    Cost-Share for Eradication...................................    38
    Eradication.................................................36, 180
    Exotic Pests and Diseases....................................   226
    Program Priority.............................................   173
Pigford Consent Decree...........................................    64
P.L. Title II Donations Program..................................    56
Plum Island Animal Disease Center................................   134
Plum Island, NY and Ames, IA Facility Needs......................   147
Project Terminations.............................................   152
Public Affairs Activities........................................    91
Questions Submitted for the Record:
    Chairman Bonilla.............................................    91
    Mr. Kingston.................................................   218
    Mr. Latham...................................................   220
    Mr. Young....................................................   226
    Ms. Kaptur...................................................   236
    Ms. DeLauro..................................................   269
    Mr. Boyd.....................................................   287
Regulations, State Planning......................................    76
Risk Management Agency...........................................    60
Rural Development................................................     6
Scorekeeping Adjustments.........................................    35
School Lunch Program, Plate Waste in the.........................   242
Section 11 CCC.................................................136, 139
Section 32 Commodity Purchases...................................   185
Section 416(b)--Foreign Food Donations...........................54, 78
Section 416(b) Review............................................    55
Senior Farmers' Market:
    CCC Funding..................................................   242
    Funding Applications.........................................   242
    Program Funding..............................................   241
Service Centers:
    ADP CAP on Modernization Plan, Impact of.....................   142
    Modernization................................................   139
    Streamlining, Agencies.......................................   204
Sheep Industry Report............................................   188
Single Food Agency...............................................   272
Smithsonian Institution Agriculture Exhibit......................   248
Staff year Reductions............................................   131
State Inspection Programs........................................   183
Statement:
    Mr. Boyd, by.................................................    60
    Mr. Farr, by.................................................    89
    Mr. Hinchey, by..............................................    49
    Mr. Kingston, by.............................................    90
    Mr. Nethercutt, by...........................................    62
    Mr. Walsh, by................................................    41
    Secretary, of the............................................  2, 7
Sudden Oak Death Syndrome....................................57, 58, 77
Sugar Forfeited to the Government................................   153
Supreme Beef vs. USDA............................................    47
Tobacco Program Administrative Expenses..........................   100
Trade Expansion..................................................   177
Transportation...................................................   225
USDA Loan Programs, Subsidy Costs................................   132
User Fees........................................................   181
Veterinary Science...............................................    42
Water Resources Programs, Terminated.............................   184
Watershed Protection Program.....................................73, 74
Wetlands Reserve Program.........................................   135
Women, Infant, and Children (WIC):
    Carryover....................................................   152
    Caseload Management..........................................   270
    Contingency Reserve..........................................   175
    EBT Implementation...........................................   157
    Electronic Benefits Transfer and Eligibles...................   115
    Farmer's Market Nutrition Program............................    66
    Funding Allocation.......................................46, 57, 58
    Funding Distribution.........................................   271
    Funding Distribution Formula.................................    58
    Funding for FY 2002, Adequacy of.............................   269
    Funding Shortfalls in FY 2002................................   270
    Participation..........................................45, 157, 180
    Participation Increases in FY 2003...........................   175
    Participation, Monthly.......................................   119
    Participation, Projected.....................................   153
    Special Supplemental Nutrition Program.......................   116
    Supplemental Appropriations, FY 2002.........................   271
    Supplemental Funding for FY 2002.............................   270

                      Departmental Administration

Advisory Committees:
    Advisory Committee Staff Costs...............................   327
    Advisory Committees funded From Other Sources................   327
    Advisory Committees Funded From Forest Service...............   327
    Advisory Committees Funded From Commodity Credit Corporation.   328
    Advisory Committees Funded From User Fees....................   328
    Explanatory Notes...........................................435-448
Agriculture Buildings and Facilities:
    Carry Over From Fiscal Year 2001.............................   358
    Explanatory Notes...........................................416-424
    South Building Renovation...................................354-356
    Headquarters Complex Rental Charges.........................356-357
Aircraft, Distribution of........................................   324
Biographies:
    Lou Gallegos.................................................   317
Civil Rights:
    Cost of Settlements.......................................318, 1164
    Equal Employment Opportunity Complaints......................   320
    Foreclosures....................................318-319, 1164, 1165
    Number of Complaints.........................................   320
    On-site Reviews..............................................   320
    Processing Complaints........................................   321
Colleges and Universities:
    Historically Black Colleges and Universities.................   350
    Funds Transferred to Land Grant Universities................351-353
    USDA 1890 National Scholars Program.........................347-349
Departmental Administration:
    Explanatory Notes...........................................384-410
    Federal Agriculture Improvement and Reform Act..............325-326
    Number of Credit Cards Issued................................   323
    Procurement Reform...........................................   322
    Savings Through Credit Cards.................................   323
    Disabilities, Targeted.......................................   323
Hazardous Waste Management Questions:
    Agency Support...............................................   364
    CCC Grain Storage Site Status...............................365-367
    Compliance Docket............................................   365
    Explanatory Notes...........................................425-434
    Foreclosures Requiring Cleanup...............................   365
    Forest Service Funding for Cleaning Up Forest Service Sites..   382
    Forest Service Reimbursement................................382-383
    Forest Service Sites Cleanup Costs...........................   382
    Funding for CERCLA, RCRA, and Pollution Prevention...........   361
    Funding for Sites...........................................369-382
    Hazardous Materials Working Group, Agencies Comprising.......   383
    Performance Goals............................................   360
    Salaries and Benefits........................................   363
    Salaries/Benefits Cleanup Costs..............................   364
    State Laws, Compliance......................................361-363
    Typical Cleanup Efforts and Associated Costs................367-369
Personnel:
    Celebration of Excellence Ceremony...........................   322
    Early Out and Buyout Options.................................   323
    Paperless Personnel Request System, Proposed.................   322
    Streamlining, USDA...........................................   321
Questions Submitted for the Record:
    Chairman Bonilla.............................................   318
Rental Payments:
    Carry Over from Fiscal Year 2001.............................   358
    Rental Payments & GSA Repair Costs...........................   358
    Space Inventory, Analysis of Current.........................   359
Service Center Implementation Team:
    Service Centers on Indian Tribal Lands, Opening of...........   320
    Funding New Field Service Centers............................   321
Outreach for Socially Disadvantaged Farmers:
    Award Process for Grants.....................................   331
    Expenditures for the Outreach Program.......................329-330
    Explanatory Notes...........................................411-415
    Grants Awarded in Fiscal Years 1997-2001....................331-346
Vehicles:
    Distribution of Motor Vehicles...............................   324
Witness Statements:
    Assistant Secretary's Statement.............................303-316

                 Office of the Chief Financial Officer

A-76/Fair Act....................................................   478
Accounting and Budget Support....................................   561
Audits:
    GAO/OIG audit reports and findings...........................   473
    Contractor audits............................................   567
Computer Security................................................   559
Corporate Systems:
    Feeder systems...............................................   566
    FFIS business benefits.......................................   562
    FFIS production agencies.....................................   465
    FFIS implementation costs....................................   466
    FFIS contract costs..........................................   470
    Modernization plan...........................................   564
    OIG concerns and funding.....................................   564
    Savings......................................................   565
Cost Accounting..................................................   553
Debt and Credit Management.......................................   476
Disaster Recovery................................................   567
Electronic Funds Transfer........................................   473
Financial Statements.............................................   555
Goverenment Performance and Results Act..........................   557
Justifications...................................................   571
Object Class Detail..............................................   568
OCFO Staffing....................................................   560
Questions Submitted for the Record:
    Chairman Bonilla.............................................   460
USDA Travel......................................................   464
Working Capital Fund:
    Stove-piping.................................................   460
    Amounts paid by agencies.....................................   461
    Plan versus actual expenses..................................   462
    Computer equipment and services..............................   463
    Capital acquisitions.........................................   464
    National Finance Center FTEs.................................   472
    Payroll System...............................................   475
    Unobligated Balances.........................................   477

                Office of the Chief Information Officer

Office of Chief Information Officer:
    A-11 Exhibit 42.............................................698-704
    Audits, Action on OIG and GAO Audits........................677-697
    Breakout Between DC and Field................................   748
    Commodity Credit Corporation (CCC) Quarterly Report.........667-674
    Common Computing Environment--CCE:
        Breakout of Object Class 25.0, Other Services...........715-717
        CCE Acceleration of GIS Acquisitions.....................   751
        CCE implementation Schedule.............................730-731
        CCE Object Class Breakout for E-Government...............   750
        CCE Planned Purchases....................................   724
        CCE Procurement Strategy.................................   731
        CCE Return on Investment.................................   723
        Common Computing Environment............................748-755
        Common Computing Environment (CCE) Object Class.........722-723
        Completion of Common Office Automation and Network 
          Services...............................................   749
        Detail of Equipment Purchases............................   750
        Equipment Replacement Plan..............................755-756
        Interoperability Lab, How Much Spent on..................   750
        Object Class 31.0, Equipment Breakdown...................   717
        Other Training Plans....................................721-722
        Relation of FSA and NRCS Requests for GIS to OCIO Request
                  756-757
        Status of Common Computing Systems.......................   722
        Stengthening Management Controls........................723-724
    Contractor Support:
        Amount of USDA IT Budget for Contractor Support..........   741
        Contractors At USDA Facilities..........................747-748
        Information Resources Management (IRM) Support Services 
          Contracts.............................................638-666
        IT Contractor Support Costs..............................   637
        Reliance on Contractor Assistance........................   741
        Use of Contractor Support................................   715
    Cyber Security:
        Budget Decrease for Mission Critical Systems 
          Certification..........................................   753
        Cyber Security Implementation...........................724-728
        Cyber Security Obligations...............................   728
        Department-wide Survivability Standard...................   753
        E-Business Security and Safeguards......................713-714
        Information Survivability................................   752
        Implementing Telecom Security Architecture..............729-730
        Priority of Information Security and Privacy.............   740
        Sensitive System Certifcation............................   753
        Similar Survivability Requests in Agencies' Budgets......   752
        Strengthening Information Risk Management...............728-729
    E-Government:
        Plans for Electronic-Based Service Delivery.............714-715
    Enterprise Architecture (EA):
        Assisting Agencies in Development of Enterprise 
          Architecture...........................................   754
        Contractor Support of EA Development.....................   755
        How Long to Develop USDA-wide Enterprise Architecture...754-755
        USDA-wide Enterprise Architecture........................   754
    Explanatory Notes...........................................760-795
    Freedom to E-File:
        E-File to Improve Service Delivery.......................   740
        Freedom to E-File Act Implemenation.....................738-739
        USDA Comprehensive E-File Implementation Plan...........739-740
    FSA Farm Loan Program Information Delivery System, Completion 
      of.........................................................   757
    Funds Expended at Department Level or Shared with USDA 
      Agencies...................................................   752
    Grade Increase in DC Positions...............................   747
    Goals for improving USDA IT Management and Security.........741-742
    History of Agency Request, Departmental, and OMB Budget 
      Action.....................................................   731
    Homeland Security...........................................751-752
    Information Technology:
        Addressing IT Workforce Issues..........................743-745
        Amount of Significant IT Expenditures...................731-733
        Development of USDA IT Infrastructure...................742-743
        Filing IT Vacancies......................................   730
        FY 2003 IT Personnel Costs and FTES.....................733-734
        Number and Cost of Agency IT FTES........................   705
        Number of IT Moratorium Waivers..........................   745
        Number of Waivers Denied by Fiscal Year.................745-746
        USDA FY 2003 IT Budget...................................   731
        USDA Information Technology (IT) Budget..................   637
        USDA IT Moratorium.......................................   746
        USDA Total Planned IT Expenditures.......................   705
    Internet:
        Benefits of Internet Service.............................   713
        Public Response to Internet Services....................711-713
        USDA Internet Program Delivery..........................709-711
    LAN/WAN/Voice:
        Costs Through Fiscal Year 2002 of LAN/WAN/Voice 
          Installations..........................................   675
        FY 2003 LAN/WAN/Voice Installation Funds.................   675
        USDA Service Center LAN/WAN/Voice Installations..........   675
    Number of People Working on USDA Websites....................   724
    Number of Web Applications Supported.........................   749
    Personnel and Budget Reductions Due to Efficiencies..........   758
    Questions Submitted for the Record:
        Chairman Bonilla.........................................   637
    Service Center Modernization:
        Completion of Service Center Information Management 
          System.................................................   758
        Detail of Agencies Personnel Working on Service Center 
          Implementation........................................675-676
        Reengineering Service Center Business Processes..........   734
        SCMI Status..............................................   738
        SCIT Contracts Approved.................................718-721
        Status of Cross Training Service Center Staffs...........   722
        Table of All Service Center Systems Requests............758-759
        Timeframes and Milestones...............................734-738
    System Migration and Modernization...........................   757
    Strengthening IT Management.................................706-709
    Testimony of Ira L. Hobbs, Acting Chief Information Officer.617-636
    Travel Increase..............................................   747
    Unfilled Positions at End of Year............................   746
    Witness Statement of Ira L. Hobbs, Acting CIO...............617-636
    Workstations:
        Purchase of Workstations Completed.......................   718
        Workstations By Agency...................................   718

                     Office of the General Counsel

Attorney:
    Hours by Agency..............................................   837
    Hours Worked.................................................   836
    Locations....................................................   837
Automation, Office...............................................   874
Budget Request, FY 2003 Breakout.................................   839
Cases:
    EEO Commission...............................................   872
    Civil and Criminal...........................................   838
Debt Collections.................................................   838
Explanatory Notes................................................   876
Law Library......................................................   839
Object Class Breakout............................................   873
Priorities.......................................................   872
Private Counsel..................................................   837
Progress, Recent Examples........................................   840
Questions Submitted for the Record:
    Chairman Bonilla.............................................   834
Staff Years......................................................   835
Statement of the General Counsel.................................   797
User Fee:
    Hours by Agency..............................................   834
    Programs.....................................................   834
Workload, Increases..............................................   874

                        Office of Communications

Agriculture Fact Book............................................   918
Biography of Kevin Herglotz......................................   910
Budget Request..................................................917-919
Computer Matching and Privacy Act of 1988........................   917
Photographic Library Conversion..................................   917
Credit Alert Interactive Voice Response System...................   917
Explanatory Notes...............................................920-934
Media Services...................................................   915
Object Classes 25.2, 26 and 31...................................   918
Press Releases Issued............................................   915
Public Affairs Activities.......................................911-913
Questions Submitted for the Record:
    Chairman Bonilla.............................................   911
Reimbursements from Other USDA Agencies.........................915-916
Resources and Staff Levels......................................914-915
Visitor Center, USDA.............................................   917
Survey of Knowledge About USDA Services..........................   918
Witness Statement...............................................907-909

                     Office of the Chief Economist

Biomass.........................................................939-940
Budget Proposals................................................940-941
Explanatory Notes...............................................942-964
Exports to Asia and Latin America................................   938
Farm Labor......................................................937-938
Food and Agricultural Policy Research Institute..................   940
Food Safety Initiative Funds Budgeted............................   939
Questions Submitted for the Record:
    Chairman Bonilla.............................................   935
Risk Assessment Rule Making.....................................936-937
Risk Assessment Staff Time.......................................   937
Stoneville, Mississippi.........................................938-939
Sustainable Agriculture.........................................935-936

                       National Appeals Division

Appeals..........................................................   968
Director Appeals.................................................   968
Explanatory Notes Increase In Advisory and Assistance............   970
Explanatory Notes Significant Decreases..........................   969
Explanatory Notes...............................................965-966
Information Technology Support...................................   970
Questions Submitted for the Record:
    Chairman Bonilla.............................................   968
Nancy L. Smith...................................................   967
Object Class Breakout............................................   970
Performance Goals and Indicators.................................   968
Vacant Positions.................................................   979
Witness Statement...............................................965-966

                 Office of Budget and Program Analysis

Budget Summary.................................................980, 981
Code of Federal Regulations......................................   980
Explanatory Notes...............................................982-991
Legislative Proposals............................................   979
Questions Submitted for the Record:
    Chairman Bonilla.............................................   979
Resources for OBPA's Responsibility..............................   979

                           Project Statement

Agricultural Marketing Service...................................   995
Agricultural Research Service....................................  1002
Animal and Plant Health Inspection Service.......................   997
Cooperative State Research, Education, and Extension Service:
    Research and Education.......................................  1003
    Extension Activities.........................................  1009
Economic Research Service........................................  1011
Farm Service Agency..............................................  1013
Food Safety and Inspection Service...............................  1016
Foreign Agricultural Service.....................................  1015
Grain Inspection, Packers and Stockyards Administration..........  1001
National Agricultural Statistics Service.........................  1012
Natural Resources Conservation Service...........................   994
Office of the Secretary..........................................   993
Risk Management Agency...........................................  1014
Rural Development................................................  1018

                             GSA Rent Cost

Agricultural Marketing Service...................................  1021
Animal and Plant Health Inspection Service.......................  1022
Food Safety and Inspection Service...............................  1026
Grain Inspection, Packers and Stockyards Administration..........  1025
Natural Resources Conservation Service...........................  1020

                      Office of Inspector General

Animal and Plant Health Inspection Service.......................  1095
Anthrax Threats..................................................  1123
Asset Forfeiture Transfers.......................................  1115
Audit Staff Assignments..........................................  1116
Biographical Sketch:
    Delmas R. Thornsbury.........................................  1086
    Gregory S. Seybold...........................................  1085
    Joyce N. Fleischman..........................................  1083
    Richard D. Long..............................................  1084
Budget Request...................................................  1088
Budget Request...................................................  1118
Budgetary Resources..............................................  1113
Computer Systems Compatibilities.................................  1103
Crop Insurance Fraud.............................................  1098
Employee Pay Scales..............................................  1116
Explanatory Notes................................................  1127
Financial Activities.............................................  1121
Financial Statement Audits.......................................  1106
Firearms.........................................................  1113
Food Safety and Inspection Service:
    Enforcement Operations.......................................  1125
    Imported Meat Report.........................................  1124
Food Safety..................................................1101, 1121
Food Stamp Program...............................................  1105
Forest Service Oversight.........................................  1094
Foundation Financial Information System..........................  1116
Fraud, Loan Programs.............................................  1090
Funds, Confidential..............................................  1110
Funds, Use by Other Agencies.....................................  1120
HAACP Implementation, Adequacy of................................  1125
Hotline Complaint Summary........................................  1111
Indictments, Convictions, and Suits, FY 2001.....................  1112
Information Technology System Security...........................  1092
Interagency Cooperation..........................................  1102
Invasive Species.................................................  1098
Investigative Properties.........................................  1089
J-1 Visa Program.................................................  1087
Legislative Action...............................................  1121
Livestock and Plants, Threats to.................................  1102
Misconduct, Employee and Public..................................  1111
Opening Remarks (Mr. Bonilla, Ms. Kaptur)........................  1055
Opening Statement (Ms. Fleischman)...............................  1056
Pork Producer Checkoff Program...................................  1101
Public Accountants, Outside......................................  1110
Questions Submitted for the Record:
    Questions Submitted by Chairman Bonilla......................  1105
Recoveries and Collections.......................................  1091
Security, Laboratory.............................................  1093
Seed Stocks, Threats to..........................................  1102
Smuggling and Pest Damage, Penalties for.........................  1100
Staffing, Agency.................................................  1117
State Mediation Program..........................................  1106
Status of Program:
    Accomplishments in Fiscal Year 2001..........................  1139
    Audit Accomplishments........................................  1147
    Investigations Accomplishments...............................  1140
Technology and Communications....................................  1096
Witnesses, Introduction of.......................................  1056
Written Statement (Ms. Fleischman):
Agricultural Products............................................  1066
Business Process Reengineering...................................  1079
Computer Security................................................  1072
Conclusion.......................................................  1081
Consumer Protection..............................................  1073
Enhanced Controls Needed on Imported Meat and Financial Integrity  1078
Food Safety and Farm Programs....................................  1073
Food Stamp Program...............................................  1076
Homeland Security................................................  1063
Implementation of Agricultural Risk Protection Act and Disaster 
  Assistance Programs............................................  1075
Introduction and Overview........................................  1061
Olympics.........................................................  1071
Operation Talon..................................................  1077
Outreach Activities..............................................  1070
Protecting Farm Interests........................................  1074
Public Corruption................................................  1077
Security of USDA Laboratories and Critical Facilities............  1064
Security Over Hazardous Material.................................  1070
Tracing Financial Transactions...................................  1069

                                

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