[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
 IS USDA ACCOUNTING FOR COSTS TO FARMERS CAUSED BY CONTAMINATION FROM 
                     GENETICALLY ENGINEERED PLANTS? 

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

                                HEARING

                               before the

                    SUBCOMMITTEE ON DOMESTIC POLICY

                                 of the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 13, 2008

                               __________

                           Serial No. 110-165

                               __________

Printed for the use of the Committee on Oversight and Government Reform


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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 HENRY A. WAXMAN, California, Chairman
EDOLPHUS TOWNS, New York             TOM DAVIS, Virginia
PAUL E. KANJORSKI, Pennsylvania      DAN BURTON, Indiana
CAROLYN B. MALONEY, New York         CHRISTOPHER SHAYS, Connecticut
ELIJAH E. CUMMINGS, Maryland         JOHN M. McHUGH, New York
DENNIS J. KUCINICH, Ohio             JOHN L. MICA, Florida
DANNY K. DAVIS, Illinois             MARK E. SOUDER, Indiana
JOHN F. TIERNEY, Massachusetts       TODD RUSSELL PLATTS, Pennsylvania
WM. LACY CLAY, Missouri              CHRIS CANNON, Utah
DIANE E. WATSON, California          JOHN J. DUNCAN, Jr., Tennessee
STEPHEN F. LYNCH, Massachusetts      MICHAEL R. TURNER, Ohio
BRIAN HIGGINS, New York              DARRELL E. ISSA, California
JOHN A. YARMUTH, Kentucky            KENNY MARCHANT, Texas
BRUCE L. BRALEY, Iowa                LYNN A. WESTMORELAND, Georgia
ELEANOR HOLMES NORTON, District of   PATRICK T. McHENRY, North Carolina
    Columbia                         VIRGINIA FOXX, North Carolina
BETTY McCOLLUM, Minnesota            BRIAN P. BILBRAY, California
JIM COOPER, Tennessee                BILL SALI, Idaho
CHRIS VAN HOLLEN, Maryland           JIM JORDAN, Ohio
PAUL W. HODES, New Hampshire
CHRISTOPHER S. MURPHY, Connecticut
JOHN P. SARBANES, Maryland
PETER WELCH, Vermont
------ ------

                     Phil Schiliro, Chief of Staff
                      Phil Barnett, Staff Director
                       Earley Green, Chief Clerk
               Lawrence Halloran, Minority Staff Director

                    Subcommittee on Domestic Policy

                   DENNIS J. KUCINICH, Ohio, Chairman
TOM LANTOS, California               DARRELL E. ISSA, California
ELIJAH E. CUMMINGS, Maryland         DAN BURTON, Indiana
DIANE E. WATSON, California          CHRISTOPHER SHAYS, Connecticut
CHRISTOPHER S. MURPHY, Connecticut   JOHN L. MICA, Florida
DANNY K. DAVIS, Illinois             MARK E. SOUDER, Indiana
JOHN F. TIERNEY, Massachusetts       CHRIS CANNON, Utah
BRIAN HIGGINS, New York              BRIAN P. BILBRAY, California
BRUCE L. BRALEY, Iowa
                    Jaron R. Bourke, Staff Director



















                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on March 13, 2008...................................     1
Statement of:
    Howington, Harvey, conventional and GE grain grower, Lepanto, 
      AR; Todd Leake, conventional and GE grain grower, Emerado, 
      ND; Don Cameron, conventional, organic and GE crop grower, 
      Helm, CA; Fred Kirschenmann, organic grain grower, Medina, 
      ND; Colin Carter, Ph.D., agricultural economist, University 
      of California, Davis; and Ray Clark, the Clark Group LLC, 
      Washington, DC.............................................    12
        Cameron, Don.............................................    28
        Carter, Colin............................................    45
        Clark, Ray...............................................    55
        Howington, Harvey........................................    12
        Kirschenmann, Fred.......................................    36
        Leake, Todd..............................................    19
    Smith, Cindy, Administrator, Animal and Plant Health 
      Inspection Service, U.S. Department of Agriculture, 
      accompanied by Michael Gregoire, Deputy Administrator for 
      Biotechnology Regulatory Services, Animal and Plant Health 
      Inspection Service, U.S. Department of Agriculture.........    76
Letters, statements, etc., submitted for the record by:
    Cameron, Don, conventional, organic and GE crop grower, Helm, 
      CA, prepared statement of..................................    31
    Carter, Colin, Ph.D., agricultural economist, University of 
      California, Davis, prepared statement of...................    48
    Clark, Ray, the Clark Group LLC, Washington, DC, prepared 
      statement of...............................................    59
    Howington, Harvey, conventional and GE grain grower, Lepanto, 
      AR, prepared statement of..................................    14
    Kirschenmann, Fred, organic grain grower, Medina, ND, 
      prepared statement of......................................    38
    Kucinich, Hon. Dennis J., a Representative in Congress from 
      the State of Ohio:
        Letter dated September 16, 2008..........................    99
        Memo dated May 31, 2005..................................   108
        Prepared statement of....................................     4
    Leake, Todd, conventional and GE grain grower, Emerado, ND, 
      prepared statement of......................................    21
    Smith, Cindy, Administrator, Animal and Plant Health 
      Inspection Service, U.S. Department of Agriculture, 
      prepared statement of......................................    79


 IS USDA ACCOUNTING FOR COSTS TO FARMERS CAUSED BY CONTAMINATION FROM 
                     GENETICALLY ENGINEERED PLANTS?

                              ----------                              


                        THURSDAY, MARCH 13, 2008

                  House of Representatives,
                   Subcommittee on Domestic Policy,
              Committee on Oversight and Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:13 p.m., in 
room 2247, Rayburn House Office Building, Hon. Dennis J. 
Kucinich (chairman of the subcommittee) presiding.
    Present: Representatives Kucinich and Issa.
    Staff present: Jaron R. Bourke, staff director; Jean Gosa, 
clerk; Jim Moore, minority counsel; Larry Brady, minority 
senior investigator and policy advisor; Benjamin Chance, 
minority clerk; and Chris Espinoza, minority professional staff 
member.
    Mr. Kucinich. The committee will come to order.
    This is a meeting of the Domestic Policy Subcommittee of 
the Oversight and Government Reform Committee. I am Dennis 
Kucinich, Chairman of the committee. Congressman Darrell Issa 
is the ranking minority member.
    The hearing title today ``Is the USDA Accounting for Costs 
to Farmers Caused by Contamination from Genetically Engineered 
Plants?'' We have a rather lengthy witness list. What I am 
going to do is read an opening statement, then defer to my 
colleague Mr. Issa. It is quite possible votes are going to be 
called, and in that case we will recess for votes, and then we 
will come back and continue.
    Contamination of conventional crops by genetically 
engineered [GE] plants can occur in several ways. They can 
pollinate non-genetically engineered plant species by wind or 
insects. They can grow as ``volunteers'' from seed that was 
unintentionally left in soil from a previous growing season. Or 
they can be mixed together with nongenetically engineered 
products in the harvesting, handling, distribution, and/or food 
processing systems. When genetically engineered plants 
contaminate the crops of conventional and organic farmers, the 
farmers pay a heavy price.
    Today's hearing will not be about whether GE crops are 
``good or a bad'' thing. Today's hearing is about whether the 
chief regulator and advocate for the farmers, USDA, and its 
subagency, the Animal and Plant Health Inspection Service 
[APHIS], is taking into account the cost to farmers and 
realities of contamination risk by the GE plants it regulates.
    In 2000, America's corn farmers faced a sudden collapse of 
international and domestic demand for all varieties of U.S. 
corn. Prices fell considerably when genetically engineered 
StarLink corn was detected in taco shells by a private 
laboratory. StarLink had been approved for commercial use by 
APHIS, though limited to animal feed by the Environmental 
Protection Agency. Japan temporarily halted imports of U.S. 
corn. One of our witnesses estimated that the short-term cost 
to farmers was $500 million. A class action suit was settled 
for $110 million against the manufacturer of StarLink.
    In 2006, America's rice farmers faced a sudden collapse of 
international demand for U.S. rice. Prices fell considerably 
when experimental genetically engineered LibertyLink was 
detected in the commodity rice supply by a foreign customer. 
APHIS investigated--over 7 months after the contamination was 
first detected--and concluded that the contamination originated 
at a field test plot in Louisiana. However, APHIS never 
determined how the contamination occurred. APHIS took no 
enforcement action, and, on its own initiative, deregulated 
LibertyLink rice after the contamination event. One of our 
witnesses today is an affected grower of conventional rice.
    Two-and-a-half weeks ago, APHIS announced another 
contamination event, this time involving a genetically 
engineered corn variety called ``Event 32.'' USDA's press 
release indicates that the cause of the contamination was the 
sale to farmers of contaminated seed, and that 53,000 acres of 
contaminated seed were planted in 2007.
    According to APHIS, contamination events are rare. But it 
is unclear if this is accurate. Not a single government agency 
detected the contamination in any of these events. This is not 
surprising because the Federal Government doesn't test for crop 
contamination. We only know about crop contamination when 
private actors discover it by testing and decide to report it 
to the public. Sometimes contamination that is discovered by 
them is not reported.
    APHIS is supposed to play a role in preventing 
contamination. But when the Inspector General, in 2005, 
published its audit of APHIS's controls over the issuance of 
permits for field testing of genetically engineered plants, it 
found, ``APHIS had little assurance that field tests are being 
conducted safely, in a way that minimizes the potential for GE 
plants to persist in the environment.'' In all, the Inspector 
General made 28 recommendations to APHIS. APHIS eventually 
agreed to corrective action on each of the recommendations.
    The National Environmental Policy Act of 1969 [NEPA], 
requires APHIS to analyze and report in Environmental Impact 
Statements [EIS] significant environmental impacts and any 
related economic impacts of decisions to deregulate or field 
test genetically engineered crops. APHIS has approved 13,500 
field tests for GE crop varieties, occurring at more than 
79,000 sites around the country, and has also deregulated more 
than 70 GE plant varieties. Yet APHIS has initiated only four 
environmental impact studies, all of them in the past year or 
so. One of them was ordered by a Federal court.
    According to APHIS, the reason for the small number of 
environmental impact studies, in contrast to thousands of 
notifications, permits, and deregulations it has issued, is 
that in nearly all cases APHIS determined that its proposed 
action did not have a significant impact as defined by the 
National Environmental Policy Act. However, two recent Federal 
court judges, reviewing APHIS's determination of, ``no 
significant impact,'' for proposed agency actions related to 
two genetically engineered plants, Roundup Ready alfalfa and 
creeping bentgrass, found that APHIS had acted in an arbitrary 
and capricious manner, APHIS's determination was inconsistent 
with the National Environmental Policy Act, and APHIS violated 
the act.
    In a Federal court decision, Geertson Seed Farms v. 
Johanns, the judge found that APHIS violated the National 
Environmental Policy Act by failing to account for the 
potential economic impact that would result from contamination 
of non-GE alfalfa by Roundup Ready alfalfa. The court ruled 
that APHIS had an obligation to evaluate economic costs 
stemming from a genetic contamination because they were so 
closely related. The Federal court concluded that the economic 
effects on the organic and conventional farmers of the 
government's deregulation decision are a direct result of the 
transmission of the genetically engineered gene to organic and 
conventional alfalfa. APHIS was required to consider those 
effects in assessing whether the impact of its proposed action 
is significant.
    Today's hearing will focus on where APHIS goes from here. 
How will APHIS incorporate the guidelines provided by these 
judicial decisions in reforming the way it regulates the GE 
crop industry? Will APHIS account for the economic impact on 
farmers caused by GE plant contamination? Will APHIS take 
seriously the National Environmental Policy Act's 
recommendations to produce environmental impact statements that 
analyze environmental impacts and related economic impacts.
    Now is the time to pose these questions and conduct 
oversight. In the wake of these two significant judicial 
rebukes, the USDA is in the process of overhauling both its GE 
crop and National Environmental Policy Act regulations.
    I thank you very much.
    [The prepared statement of Hon. Dennis J. Kucinich 
follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT

    Mr. Kucinich. The Chair recognizes Mr. Issa.
    Mr. Issa. Thank you, Mr. Chairman. And thank you for 
holding this hearing on two important subjects, one clearly 
within the purview of this committee, one perhaps not within 
the purview of this committee, but certainly worthwhile 
discussing here today.
    I am always pleased when the Committee on Government 
Oversight and Reform deals with the question of whether or not 
the administration is properly adhering to laws passed by the 
Congress and regulations often created by the administration or 
passed the administration themselves. Clearly, today that is 
the focus of this hearing.
    I appreciate the fact that genetically modified plants have 
and continue to be a lively discussion around the world. When I 
was first elected to Congress in the year 2000, one of the 
first trips I took was to Europe, and to discover that the 
Europeans were not just objecting to GMOs in Europe, but 
actually objecting to the United States giving away free food 
in Africa if it was the product of GMOs. I found that amazing 
then; I find it amazing now.
    I believe that, in fact, we must try to find better crops 
for better feeding of the people of the world, and a reduction 
in erosion and other problems caused by conventional plants.
    I might note that contamination is not limited to one crop 
versus another. In my own home in California, we have been 
struggling for decades with the glassy-winged sharpshooter, 
which would not be passing on Pierce's disease for our wine 
industry and grapes and raisins if it were not for the fact 
that we are also a citrus producer. The glassy-winged 
sharpshooter lives in mass quantities without significant 
damage to oranges, so they make a perfect breeding ground. 
Unfortunately, oranges and our grape vines often grow close 
together, and we have been struggling trying to find a way to 
have those two crops, clearly historic crops, but crops, not be 
damaged by their collocation. Additionally, California has 
often been unfairly told by the Japanese that, in fact, our 
long-grain rice or even California short grain, is somehow 
indigestible by the Japanese, clearly a protectionist maneuver, 
and not a legitimate complaint about the quality of what we 
grow in California.
    Having said that, we also know that many naysayers suggest 
the world is running out of space to produce the world's food 
supply. I agree that if we cannot get past the 6 billion-plus 
today, and we get to 12 billion, we will have to produce more 
food in less space. So, then, why would anyone argue against GM 
advancements that promise increased yield per acre?
    The International Service for the Acquisition of Agri-
biotech Applications, the ISAAA, shows that in 2006 the number 
of hectares globally cultivated with GM crops increased by 12 
million hectares. More importantly, that doubled the amount of 
food produced on those same hectares.
    Many argue that pesticides harm our health. I agree. If you 
believe this, you must ask the question of why would you not 
want to have improved crops that need less pesticides? The 
National Center for Food and Agriculture Policy, the NCFAP, 
concludes in 2004 alone, biotechnology in the United States 
reduced pesticide use by 34 percent. If soil and water 
conservation is of concern to you, then how could you argue 
against biotech crops which reduce soil erosion and reduce 
water storage and treatment needs?
    The Conservation Technology Information Center reports an 
increase of no-till acreage farmland due to biotech agriculture 
reduces soil erosion by 1 billion tons per year. Now, I might 
note Speaker Pelosi used Federal funds allocated by the House 
of Representatives to buy carbon credits that were produced by 
no-till agriculture.
    If you believe the growing trade deficit is a problem worth 
addressing, then how can you argue that curtailing the 
agriculture community's ability to increase exports somehow 
serves that purpose? Ag Secretary Ed Schafer announced this 
week that exports are forecasted to reach a record $104 billion 
in fiscal year 2008, up $10 billion from November's forecast, 
and $19 billion from 2007.
    Today Don Cameron, a California grower, will tell us 
exactly how he is able to balance conventional, organic and 
biotech crops, reaping economic and environmental benefits for 
all. Mr. Cameron is proof that the use of these new 
technologies properly can, in fact, allow them to harmoniously 
work together.
    There is a risk. I am here today to say that the government 
has an obligation to oversee that risk, to constantly monitor 
it, because, in fact, our food supply is too important not to 
have the USDA and other Federal agencies adhering to acts of 
Congress and their own regulations.
    So, Mr. Chairman, I look very much forward to this 
oversight hearing because I do believe that Congress has an 
absolute oversight responsibility, and I congratulate you for 
focusing on that today and yield back.
    Mr. Kucinich. I thank the gentleman from California.
    Without objection, Members and witnesses will have 5 
legislative days to submit a written statement or extraneous 
materials for the record.
    Again, for those who have just joined us, today's hearing 
will not be about whether GE crops are good or bad. Today's 
hearing is going to be about whether the chief regulator and 
advocate for the farmers, USDA, and its subagency, the Animal 
and Plant Health Inspection Service [APHIS], is taking into 
account the cost to farmers and realities of contamination risk 
by the GE plants it regulates.
    Now, there are no additional opening statements. The 
subcommittee will receive testimony from the witnesses before 
us today. I want to start by introducing our first panel. Mr. 
Harvey Howington jointly owns a family farm operation with his 
parents. Until 2006, Mr. Howington farmed 1,200 acres on 3 
tracts of land near Lepanto, AR. The farming operation 
consisted of 500 acres of rice, 700 acres of Roundup Ready 
soybeans. After the LL601 contamination event in 2006, he 
decided to quit farming and now rents his farmland to 
neighboring farmers. He is vice president of the Arkansas Rice 
Growers Association, and a member of the board of directors of 
the U.S. Rice Producers Association. From 2002 to 2003, he was 
president of the Arkansas Seed Growers Association, and remains 
on its board of directors.
    Mr. Todd Leake----
    Mr. Leake. Leake.
    Mr. Kucinich [continuing]. Leake is a family farmer from 
Emerado, ND. Mr. Leake annually grows approximately 1,000 acres 
of wheat, and approximately 500 acres of soybean and 500 acres 
of navy bean and sunflower. Since 2000, Mr. Leake has been 
involved in policy issues surrounding the development and 
potential deregulation of genetically modified wheat.
    Mr. David Cameron owns and farms Prado, is it? I am sorry.
    Mr. Issa. Don Cameron.
    Mr. Kucinich. Strike that, I am sorry. Mr. Don Cameron owns 
and farms is it Prado?
    Mr. Cameron. Prado.
    Mr. Kucinich. Prado. Owns and farms Prado Farms located in 
Fresno County, CA. Since 1981, he has been the vice president 
and general manager of the Terranova Ranch, Inc., and farms 
approximately 5,500 acres of conventional, organic, and biotech 
crops ranging from organic pima cotton, biotech corn and 
alfalfa, along with a diversity of other annual crops.
    Mr. Fred Kirschenmann farms 3,500 acres of certified 
organic crops in North Dakota. His family farm was certified in 
1980, making it one of the early operations to make the 
transition. He is also a distinguished fellow for the Leopold 
Center for Sustainable Agriculture at Iowa State University. 
Mr. Kirschenmann holds a Ph.D. from the University of Chicago, 
and has written extensively about ethics in agriculture. He has 
also held national and international appointments, including 
the USDA's National Organic Standards Board.
    Professor Colin Carter was born and raised on a farm in 
Alberta, Canada. He obtained a Ph.D. in agricultural economics 
from the University of California Berkeley in 1980. Professor 
Carter is currently professor of agriculture and resource 
economics at the University of California Davis. He has 
published more than 120 research papers, authored or edited 15 
monographs and books, and contributed dozens of chapters to 
books. He has published in areas of international trade, 
agricultural policy, futures and commodity markets, and 
economics of China's agriculture, and the economics of 
biotechnology adoption in agriculture. Professor Carter was 
named fellow of the American Agricultural Economics Association 
in 2000 in recognition of his many contributions to the field 
of agricultural economics.
    Finally, Mr. Ray Clark is a National Environmental Policy 
Act expert, with more than three decades of environmental 
management experience. As Associate Director of the Council on 
Environmental Quality, he implemented the Council's mandate for 
oversight of the National Environmental Policy Act, reviewed 
and approved Federal agency regulations with respect to that 
act, and mediated interagency disputes regarding compliance. As 
Acting Assistant Secretary of the Army for Installations and 
Environment, and Principal Deputy Assistant Secretary of the 
Army, he was responsible for over 14 million acres of land. As 
an adjunct faculty member at Duke University, Mr. Clark 
develops NEPA courses and teaches at the Nicholas School of the 
Environment.
    I want to thank all the witnesses for being present, 
appearing before this subcommittee today. It is the policy of 
the Committee on Oversight and Government Reform to swear in 
all witnesses before they testify. I would ask that you rise 
and raise your right hands.
    [Witnesses sworn.]
    Mr. Kucinich. Let the record reflect that the witnesses 
answered in the affirmative.
    I will now ask that we begin. I want to give the first 
witness an opportunity to get his testimony in, and then I am 
going to have to recess to go to vote, and I will be back.
    Mr. Howington, I ask that you give a brief summary of your 
testimony, to keep the summary to 5 minutes in duration. Your 
entire written statement--this goes to all the witnesses--even 
though I ask you keep your testimony to 5 minutes, your entire 
written statement will be included in the record of this 
hearing. So Mr. Howington, if you would begin.

   STATEMENTS OF HARVEY HOWINGTON, CONVENTIONAL AND GE GRAIN 
  GROWER, LEPANTO, AR; TODD LEAKE, CONVENTIONAL AND GE GRAIN 
GROWER, EMERADO, ND; DON CAMERON, CONVENTIONAL, ORGANIC AND GE 
CROP GROWER, HELM, CA; FRED KIRSCHENMANN, ORGANIC GRAIN GROWER, 
   MEDINA, ND; COLIN CARTER, PH.D., AGRICULTURAL ECONOMIST, 
UNIVERSITY OF CALIFORNIA, DAVIS; AND RAY CLARK, THE CLARK GROUP 
                      LLC, WASHINGTON, DC

                 STATEMENT OF HARVEY HOWINGTON

    Mr. Howington. I would like to thank the Chair, 
Representative Kucinich; the ranking member, Representative 
Issa; and the members of the subcommittee for the opportunity 
to speak on this matter of great importance to American 
farmers. This is my first time to testify before Congress, and 
it is an honor to be here.
    By far and away the most important title I have is father. 
The greatest gift I have to pass on is the family farm legacy. 
I am here today to talk to you about a serious threat to that 
legacy.
    I grow GMO crops. Unfortunately, consumer acceptance for 
all GMO crops is not universal. Rice is the least accepted of 
all GMO crops. As farmers, we have to grow products consumers 
want and try to do it at a profit.
    In early August 2006, farming was looking pretty good. We 
had a good crop, and prices were headed up. Then on August 19, 
2006, USDA announced Bayer's LibertyLink LL601, a herbicide-
tolerant, genetically engineered variety, had been found in 
non-GMO rice. At the time LL601 had not been approved for human 
consumption. Reaction was immediate. Japan banned importation 
of all long-grain U.S. rice. The European Union imposed strict 
testing requirements on all U.S. rice shipments. That had the 
effect of stopping all sales to that market. In the 7 days 
following the announcement, the American rice crop lost $168 
million in value, with the futures price dropping from $9.83 a 
hundredweight to $8.99 a hundredweight.
    At the time of the contamination event, global rice prices, 
supplies were becoming increasingly tight, and the futures 
price was tracking upward. It is not inconceivable that rice 
prices approaching $12 a hundredweight could have been realized 
had it not been for the contamination event. Even if you don't 
include this loss in price potential, based on a conservative 
estimate calculated by the USRPA, the U.S. rice industry loss 
$1.2 billion due to this contamination event. That figure is 
consistent with the findings of Dr. Neal Blue, an agricultural 
economist at Ohio State University.
    Farmers were in a quandary. Is my rice contaminated? Can I 
sell it if it is? What sort of price hit am I going to take? 
And that was just the rice just harvested. What to plant next 
year? What varieties are going to be available? Is the seed 
going to be safe? How much more is the seed going to cost me? 
What is testing going to cost me? What tests should I have? At 
what level should it be tested? Are the fields planted in rice 
last year going to be contaminated this year?
    Through all this ordeal the LL601 contamination event 
caused, three questions remained at the forefront of the minds 
of rice farmers: How did the contamination occur? Who is 
responsible? How did it get so widespread before detection 
occurred?
    One thing is perfectly clear. These answers will not be 
forthcoming from the USDA, whose mandate it is to administer, 
manage and monitor field trials to ensure that contamination 
events don't occur. In that regard, the Agency has failed 
miserably. After spending 8,500 staff hours conducting their 
investigation, they did not answer a single one of these 
questions. No enforcement action was taken against Bayer, or 
anyone else for that matter.
    I listened to the USDA's findings on a conference call. It 
was very difficult listening to the USDA say they didn't know 
who, they didn't know how, and it happened so long ago we can't 
do anything about it even if we did. This is not an isolated 
incident. The LL601 event resulted in a decision to leave 
farming for many rice producers. Nearly 600 rice farms were 
lost between 2006 and 2007. While not all quit because of 
LL601, it had to be a major factor. The impact on local rural 
economies cannot be calculated.
    The USDA needs to conduct more comprehensive environmental 
analysis before embarking on field trials that pose major 
economic threats to an agriculture industry or commodity. The 
decisionmaking process needs to be more transparent, with an 
opportunity for farmers to speak and be heard. And most 
importantly, the burden must be placed on the biotech company 
to demonstrate how contamination will be prevented in the 
farming industry.
    I appreciate this opportunity. Your efforts to help solve 
this problem are sincerely appreciated by all the rice farmers 
I represent here today. I will be happy to answer any questions 
as best I can.
    Mr. Kucinich. Thank you very much, Mr. Howington.
    [The prepared statement of Mr. Howington follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT
    
    Mr. Kucinich. We are going to recess right now. There are 
two votes on. I think that means that I could be back here in 
20 minutes at the earliest. So if we all--I ask all the 
witnesses don't go too far, but we have about 20 minutes. And 
so the committee is in recess, and we will resume testimony 
with Mr. Leake when we return. Thank you.
    [Recess.]
    Mr. Kucinich. The committee will come to order. We are 
going to resume the testimony here with Mr. Leake. Thank you 
very much for your patience. Let's resume. Thank you.

                    STATEMENT OF TODD LEAKE

    Mr. Leake. I would like to thank the Chair, Representative 
Kucinich; and the ranking member, Representative Issa; and the 
members of the committee for the opportunity to testify on this 
matter.
    My name is Todd Leake. I own and operate a family farm near 
Emerado, North Dakota. I farm 2,000 acres, half of that to 
wheat. North Dakota is the Nation's No. 1 producer of wheat. 
The crop is critical to our economy and the communities that we 
support.
    Because wheat is so critical to my livelihood, I became 
concerned when it was revealed in 1999 that North Dakota State 
University and other ag universities in the region were 
developing genetically engineered wheat. The basis of my 
concern was that since the introduction of GE corn, soybeans, 
and canola in 1996, many of our largest consistent market 
countries had enacted restrictions or moratorium on the 
importation of GE crops.
    In 2002, U.S. Wheat Associates conducted a survey that 
concluded that, ``buyers in Japan, the EU and Korea have 
repeatedly and definitively stated that they would not accept 
genetically modified wheat at any tolerance.'' These three 
countries accounted for 44 percent of hard red spring wheat 
exports. Also in 2002, USDA Foreign Ag Service assessed the 
information compiled in overseas branch offices regarding buyer 
attitudes and governmental regulations of GE crops. The 
findings provided further support to the conclusions contained 
in the U.S. Wheat Associates surveys. Of the top 10 U.S. wheat-
importing countries, all had laws regarding the importation of 
GE crops.
    During that same period, a study of the impact of 
commercialization of GE wheat was undertaken by Dr. Rob Wisner 
of Iowa State University, one of the country's most respected 
agriculture economists. Dr. Wisner's report concluded that if 
GE wheat were commercialized, U.S. wheat growers would lose 
between 43 and 52 percent of their total exports, resulting in 
a net loss of between 32 and 35 percent of the income from that 
crop. To my farming operation this would clearly result in 
growing wheat at a loss.
    Even with it firmly established the production of GE wheat 
would be an economic disaster for wheat producers nationwide, 
research into GE wheat continued unabated. All the major 
agricultural universities in the region conducted and 
contracted research and field testing of GE wheat at their 
extension research centers. Great media attention was paid to 
the issue of cross-pollination of GE wheat with the breeder 
stock and the foundation stock also grown at the extension 
centers. Those breeder and foundation stocks are the basis from 
which all future wheat varieties grown in North Dakota are 
derived.
    When Monsanto Corp. petitioned for the deregulation of 
their Roundup Ready GE wheat, concerns were escalated over the 
possibility of widespread GE contamination or adventitious 
presence of GE wheat in the commercial wheat supply as 
commercialization came one step closer to reality. Farmers and 
grain buyers alike knew that the segregation would be 
impossible, that cross-pollinating seed would be spread by 
machinery. Research from the University of Manitoba predicted 
that the commercial wheat crop would be contaminated beyond the 
limits of the importation tolerances of the major importing 
countries within 5 years.
    Between 2001 and 2004, farm group leaders had conversations 
with USDA/APHIS. When informal discussions failed to produce an 
agreement on the need for an EIS on GE wheat deregulation, 
farmers and farmer groups signed a formal petition requesting 
an EIS be conducted.
    In March 2004, accompanied by our legal representatives, 
Dr. Robert Wisner and other wheat growers and grain 
merchandisers and farm group leaders, I met with Under 
Secretary Bill Hawkes and the Acting Director for APHIS on the 
issue of an EIS on Roundup Ready GE wheat deregulation 
petition. Ultimately, despite our concerns, our request was 
denied.
    This issue did not end there. Because of the deregulation 
petition pending before USDA, grain companies from other 
countries restricting the importation and use of GE wheat began 
accessing their supplies elsewhere than the United States, in 
particular from the former Soviet Republics in the Black Sea 
region. Citing market concerns of nonacceptance, Monsanto 
shelved its Roundup Ready wheat program in May 2004 and pulled 
their deregulation at APHIS shortly thereafter.
    While I applaud Monsanto's ultimate decision to pull the 
Roundup Ready wheat deregulation petition based on the 
sensitivity of the international GE marketing issue, I feel 
that it should not have been left solely as a corporate 
decision. The environmental contamination issues and the 
economic loss issues were clearly within the purview of USDA. 
These should be addressed under the National Environmental 
Policy Act. This would allow farmers like myself, who would pay 
the price for GE contamination, the opportunity to be heard in 
that process. Thank you.
    [The prepared statement of Mr. Leake follows:]

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    Mr. Kucinich. Mr. Cameron, you may proceed. Thank you.

                    STATEMENT OF DON CAMERON

    Mr. Cameron. Thank you, and good afternoon, Mr. Chairman. 
Thank you for providing me the opportunity to share with you 
and this distinguished subcommittee my experience as a farmer 
who grows both organic and biotech crops on my farm.
    My name is Don Cameron. I am general manager of Terranova, 
a diversified farming operation located in Fresno County's San 
Joaquin Valley. At Terranova we farm approximately 26 different 
crops, including cotton, alfalfa, tomatoes, carrots, garlic, on 
nearly 5,500 acres.
    On our farm we grow organic, conventional, and biotech 
crops. About 10 percent of our overall production is grown for 
organic markets, including organic cotton and alfalfa. The 
remaining 90 percent of the farming at Terranova is a 
combination of conventional farming practices and crops derived 
from agricultural biotechnology, which includes biotech cotton, 
corn, and alfalfa. Our farming operation is living proof that 
organic and biotech farming practices can coexist in near 
proximity without one negatively impacting the other.
    Over the last decade, millions of acres of biotech crops 
have been grown in the United States which coexist with organic 
crop production. In fact, the growth of agricultural 
biotechnology has been accompanied by a surge in both organic 
acreage and profits derived from the organic production in this 
country. Indeed, organic farming has been a profitable 
component of our farming operation.
    What is true for farmers across the United States is also 
true for me; namely, that farming is a business. Like good 
businesspeople, we seek to be good stewards of our land while 
maximizing the opportunities in the marketplace. When we 
determine each year what crops will be planted, we look at all 
aspects of each potential crop from expected price, yield, crop 
rotation, income, expense ratios, and whether we can compete on 
a global basis with other countries. We have chosen to 
specialize in organic farming on a portion of our farm to 
increase diversity and fill a niche in the marketplace. The 
risk is much higher in organic farming due to the lack of 
effective treatments for various insects, diseases, and weed 
problems. We have accepted the risks with the potential for 
increased profitability. Most insecticides, herbicides, 
fungicides, and commercial fertilizers are eliminated in 
organic farming. Hand weeding with contracted labor is our 
major expense.
    Organic farming is a process we have chosen to put in place 
on a portion of our farm. On the remainder of the farm, we 
chose to farm with conventional techniques. We use modern 
technology, with advanced practices, including GPS tractors, 
plant mapping, integrated pest management, and irrigation 
management. We also use biotech seed varieties when available 
for corn, cotton and alfalfa.
    The trait we find most useful is the Roundup Ready trait, 
which allows the plant to resist herbicide Roundup or 
glyphosate. Why is this so important to us? Because our 
economic savings that we realize through the use of the Roundup 
Ready system have been tremendous. Compared to conventional 
crops, Roundup Ready alfalfa saves us about $110 per acre, 
Roundup Ready cotton $165 per acre, and Roundup Ready corn $17 
per acre. These savings include the reduction of overall 
chemical use on our farm, reduced labor costs, and fewer trips 
across the fields with tractors, which conserves our farm 
equipment and reduces diesel use, along with emissions and dust 
particles released into the environment. If we were comparing 
Roundup Ready weed costs with weed control from our organic 
production, the savings would be even greater.
    To elaborate on that point, here in the United States our 
labor costs are expensive because we provide a fair wage, safe 
working conditions, and insurance benefits for our workers. To 
hand-weed organic crops, I have spent up to $2,000 per acre, as 
there was no alternative available. This is not an effective 
use of a dwindling supply of labor. With Roundup Ready crop, my 
total weeding bill is less than $35 per acre. My crop is clean 
and free of weeds. For the American farmer and for me to 
compete in a world marketplace where labor elsewhere may only 
cost $1 per day, we need technologies like this to remain 
competitive.
    I believe that the flexibility that biotechnology can 
provide is a major reason that I can successfully grow the 
variety of crops that we do. The Roundup Ready cropping system 
leaves no chemical residue that will interfere with the 
following crops. In the past, we would use herbicides that had 
long residuals in the soil, which would preclude the planting 
of sensitive crops following their use. We now have the 
flexibility to change crops rapidly with major changes in the 
markets without risk from previous herbicide applications.
    I am always asked how we keep pollen flow from one type of 
farming operation from interfering with the other. We grow many 
crops for their seeds, both organic and conventionally, and 
each one is different. We have been dealing with these issues 
long before the advent of biotechnology crops. If farmers were 
not successful with this, there would be only one color of 
corn, one variety of melon, and one type of cotton. We know the 
biology of each crop we grow, where we need to grow it to 
maintain and preserve its integrity and its identity. We 
maintain necessary separation when needed, especially in seed 
production. In some cases there is no interaction, and in other 
cases there may be, but we know when to anticipate the 
interaction and separate the varieties according to their 
characteristics. We clean our planters, harvesters, bins and 
trucks to maintain this purity, the same way we separate our 
organic from our nonorganic or our biotech crops. We talk with 
our neighbors, we communicate, we work out the issues that may 
arise. We are also required by our commercial contracts to 
provide a crop that is virtually free of other varieties, be it 
biotech to organic or organic to conventional. We maintain 
separation to ensure this does not happen.
    On our farm we consistently maintain a higher level of 
standards, which exceed the National Organic Standards, to 
fulfill contract requirements from our buyers. In all my years 
of farming, I have never lost a market nor income because I 
grow organic, conventional or biotech varieties on my farm. In 
short, we were coexisting long before the term was coined.
    It is my hope that the United States will remain 
competitive, and that our Nation's leaders will provide the 
foresight to keep us in the forefront of modern agriculture 
production for many years to come. As an American, I do not 
want to rely on another country for my food and fiber supply. 
We are the most productive Nation in the world in agriculture, 
and we need the tools to remain leaders. I know we can grow 
organic and biotech crops without one jeopardizing the other. I 
know this because I have been doing it successfully on our farm 
over the last decade.
    Thank you again for the opportunity to share my views. I 
look forward to answering any questions you may have. Thank 
you.
    Mr. Kucinich. I thank the gentleman.
    [The prepared statement of Mr. Cameron follows:]

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    Mr. Kucinich. I just would like to remind the witnesses if 
they could try to keep their testimony to within 5 minutes to 
help us facilitate this. Thank you very much.
    OK. Mr. Kirschenmann.

                 STATEMENT OF FRED KIRSCHENMANN

    Mr. Kirschenmann. Yes. Thank you. And thank you for 
inviting us to this hearing.
    I would like to add just three observations to those that 
have been made by my farmer colleagues, and they are all based 
on our experience on our own farm, farming organically for the 
last 30 years.
    The first observation is that there is perhaps not a 
misconception, but a misappropriation of information within 
USDA regarding whether or not organic farmers are harmed in the 
marketplace by contamination. And USDA quite correctly points 
out that organic certification is based on a process 
certification; that is, our product is not routinely tested to 
find out if there is contamination. We are simply inspected and 
certified to make sure that we don't use transgenic 
technologies in our production system, and that is what is 
meant by process certification.
    The problem is that while that is true, there are 
increasingly people in the organic market who buy our products 
who are not satisfied with simply the fact that we are 
certified organic. They, in fact, do their own testing because 
they know that their consumers are not just concerned about 
whether we use the technology on our farms, but they simply 
don't want the GMO in their food. And so increasingly now the 
customers that we sell to are routinely testing. They have very 
sophisticated laboratories, and they test to the lowest 
possible degree that technology allows. And if there is 
contamination, they simply reject the product.
    To give you a case in point, we sell virtually all of our 
organic Durham wheat to Eden Foods, and Eden Foods is one of 
those companies that feel that they have a covenant with their 
customers that they do not want to violate, and so they 
guarantee to their customers that when they buy their organic 
pasta, that there are no GMOs in that pasta, and so they 
routinely test. And I have been to their plant, I have seen 
their laboratory. It is very sophisticated, uses the most 
recent technology and science. And I have seen the records of 
rejecting loads of soybeans when they were delivered when they 
had small levels of contamination. And, of course, the farmers 
then had no choice but to take the load back. And, of course, 
as you can imagine, that is a considerable cost to the grower 
not only because of the lost market, but also because of the 
transportation costs, etc., to the plant and back.
    So I think it is important for this committee to recognize 
that in the marketplace increasingly now the buyers are in 
there because they want to maintain their confidence and their 
relationship with their customers, are increasingly now testing 
the product. This is also true, has been routinely true, of 
organic products exported to Europe, where it routinely gets 
tested. And all of the companies that we sell our grain to 
apprise us of the fact that we had better make sure that there 
are no contaminants in the product before it ever leaves our 
shores.
    Now, all of that, of course, has led us on our farm to 
simply make a firm decision, and that is that we will not grow 
any crops on our farm now that have a counterpart that has a 
GMO crop. So for that reason we had to stop raising canola 
about 10 years ago, despite the fact that it was a very good 
crop in our rotation. And the rotation is important, because 
something that is not often understood by nonorganic farmers is 
that in order to make an organic system work, you have to have 
a very complex rotation, which is the way that you prevent 
infestation from weeds and diseases and other contaminants. And 
so we have found on our farm that we need to alternate cool-
season and warm-season crops, we need to alternate grassy 
plants with broadleaf plants, we need to alternate leguminous 
crops with other cash crops. And there are only so many 
alternatives that we have in making those decisions, because we 
are limited by climate and other constraints, and also, of 
course, most importantly, by the market.
    So giving up canola was a big loss to our farm. It was a 
great crop. It worked well in the rotation. It is one of the 
few broadleaf, cool-season crops that we can grow, and it was a 
crop that was very lucrative because we were selling it into a 
high-end organic oil market. And we had to give it up.
    The thing that concerns us most at this point is that 
alfalfa and wheat are now again being threatened to come into 
the GMO market, and these are two crops which are absolutely 
essential to our rotation. A third of our production is in 
wheat, and if we were to lose that, it would be a serious 
economic blow to our farm.
    Mr. Kucinich. I thank the gentleman.
    [The prepared statement of Mr. Kirschenmann follows:]

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    Mr. Kucinich. Professor Carter, please.

                   STATEMENT OF COLIN CARTER

    Mr. Carter. Thank you, Chairman Kucinich.
    Despite the successful commercialization of genetically 
modified crops in the U.S. agriculture and the successful 
coexistence of GM and non-GM, farmers in our Nation have 
suffered huge financial losses due to accidental contamination 
of their crops with unapproved GM material. The most serious 
accidents were the contamination of the U.S. corn supply in 
2000 and the 2006 contamination of the U.S. long-grained rice 
supply. In both of these cases, farmers were innocent victims 
of lax government regulations and poor stewardship by companies 
developing, testing and selling GM seeds.
    StarLink corn was found in hundreds of food products. The 
problem spread internationally. StarLink contamination was very 
disruptive, because a large share of the market had zero 
tolerance for its use, and zero tolerance is virtually 
impossible to obtain. Less than 1 percent of the U.S. corn 
acreage was planted to StarLink, yet 70 percent of the in-bound 
corn samples tested by Japan, our most important foreign 
market, were positive. I have found that the StarLink 
contamination resulted in a 6 percent drop in the price of corn 
that lasted for at least 6 months, costing corn farmers $500 
million.
    In August 2006, U.S. rice farmers were surprised when the 
USDA announced that unapproved GM rice had been found in export 
shipments, and that carrier variety was Cheniere. Apparently, 
the U.S. Government knew about this accidental contamination 
for some time before farmers were informed in August. Why the 
delay in informing farmers?
    Just like StarLink, the LibertyLink fiasco has demonstrated 
that it takes a very long time to clean up contaminated 
samples. As long as a contamination like LibertyLink drags on, 
farmers are losing money.
    The U.S. exports about 50 percent of its long-grain rice, 
so foreign market tolerance levels for adventitious presence in 
GM material is very important. The European Union's imports of 
U.S. rice came to a virtual halt following the LibertyLink 
contamination. In a matter of a few business days following the 
contamination announcement, the Chicago rice futures price 
dropped sharply, by about 10 percent. Unfortunately for 
farmers, they were just beginning their harvest, and they 
suffered a loss to the value of the crop before they had a 
chance to market it. LibertyLink found its way into the rice 
foundation seed supply. And unfortunately, the USDA could not 
explain how this happened.
    Then in March 2007, the USDA announced that an additional 
popular variety of long-grain rice, CL131, was also 
contaminated with Bayer's LL604 unapproved. The Chicago futures 
price dropped sharply again.
    Cheniere and CL131 were planted on about 30 percent of the 
southern long-grained rice acreage in 2006. These varieties 
could not be planted in 2007, causing additional financial 
losses for rice farmers.
    The economic question boils down to the following: What are 
the benefits and costs of deregulation? In my view, the USDA is 
not necessarily taking a hard look at all aspects of this 
question. Last year Judge Breyer ruled in a case regarding the 
USDA's deregulation of GM alfalfa, highlighting some important 
gaps in the current system. The alfalfa case is instructive, 
but we have to be careful to distinguish between situations of 
unapproved GM crops used in confined field trials from those 
approved for commercialization. Both situations can be affected 
by accidental contamination, but in the first case all farmers 
stand to lose, and it is often the legal responsibility of the 
developing company. In the second case it is a coexistence 
issue between GM and non-GM.
    One major problem underscored by the alfalfa case is a lack 
of Federal rules regarding accidental contamination of organic 
products. Apparently the USDA does not even know how to handle 
this issue, as the Agency argued that producers may not 
necessarily lose their organic certification if they 
unintentionally sell unorganic crops contaminated with GM. Some 
organic producers may not agree. As Judge Breyer implies in the 
ruling, even if the USDA allowed contamination of organic 
alfalfa through high tolerance levels for adventitious 
presence, and sellers could still claim organic status when 
contamination occurs accidentally, this would not guarantee 
that organic production is sustainable.
    The rules should ensure that the production of organic is 
possible with a reasonably low contamination level. The USDA 
should provide better evidence on the benefits and costs of 
deregulation, especially when exports are an important market 
for the crop in question and there are barriers in those 
foreign markets. As we learned from StarLink and LibertyLink, 
this technology is not easily reversible. The USDA might find 
that new GM crops could be grown, but with certain geographical 
restrictions, buffer zones, and traceability and segregation 
rules.
    I am not arguing that the Roundup Ready alfalfa case should 
be generalized to all future releases of GM crops and that a 
full-blown environmental impact assessment be conducted in all 
cases. However, in going forward, the USDA should strive to 
consider which new crops constitute a significant net economic 
risk and which do not. Even in Europe, or in Canada for that 
matter, approval of a new GM crop does not entail a formal 
assessment of commercial market risks of introducing a new 
crop, but these other countries do consider contamination 
tolerance thresholds and aim to develop coexistence measures 
that comply with threshold levels. However, I do caution that 
stringent market tests could easily transform into a 
precautionary principle approach, which would be a huge 
mistake.
    To summarize, our mistakes over the StarLink and 
LibertyLink contamination incidents were major setbacks to the 
global biotechnology revolution in agriculture. Our trading 
partners point to these two incidents as evidence that GM crops 
are not being properly managed in the United States. They are 
right. We are not doing a great job. The stakes are too high to 
put our heads in the sand and defend the status quo. 
Genetically engineered crops hold tremendous promise for the 
future of United States and world agriculture, but they must be 
managed and regulated in a way that assures the marketplace 
that any risks are properly managed.
    Mr. Kucinich. Thank you, Professor Carter.
    [The prepared statement of Mr. Carter follows:]

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    Mr. Kucinich. We will now hear from Mr. Clark. I would ask 
Mr. Clark if he could keep his testimony to 5 minutes, and then 
we will go directly to questions. Thank you.

                     STATEMENT OF RAY CLARK

    Mr. Clark. Thank you, Mr. Chairman. It is certainly a 
pleasure to appear here once again before you, before the 
Domestic Policy Subcommittee, on another issue regarding the 
National Environmental Policy Act. And you have stated my 
background, that I am senior partner at The Clark Group after 
leaving the administration in 2001. My expertise, therefore, 
lies in the responsibilities and obligations of the executive 
branch of government as it relates to decisions affecting the 
human environment, and I am not an expert in genetically 
modified organisms, but have spent my career studying difficult 
and complex issues and the resolution of those issues, such as 
biological defense research and some others that I could name.
    APHIS regulates certain genetically engineered organisms 
that may pose a risk to plant or animal health. And I have 
said--and I used the word ``may.'' APHIS Biotechnology 
Regulatory Services regulates introduction of genetically 
engineered organisms that may pose a risk to plant health. It 
is a huge responsibility to oversee an industry that is rapidly 
growing and rapidly becoming more complex. The decisions that 
APHIS is making now, however, can have long-term beneficial or 
negative effects on the natural environment, the human 
community, and the economy.
    When Congress passed the National Environmental Policy Act 
in 1969, the country was feeling the effects of a rapidly 
growing technology in other areas similar to what we are 
experiencing today. The rise of the chemical and nuclear 
industry of the 1950's and 1960's and some of the unintended 
consequences is in part what led to the passage of the National 
Environmental Policy Act in 1969.
    Congress was prescient enough to know that Federal agencies 
will respond to requirements rather than oratory aspirations. 
The statute requires agencies to take a hard look at the 
impacts of major Federal actions, such as changes to 
legislation or regulation, approval of projects, and management 
of the Nation's resources. The Council on Environmental Quality 
developed the regulations that require agencies to prepare 
environmental assessments or environmental impact statements on 
broad actions so they are relevant to policy and are timed to 
coincide with meaningful decision points in agency planning.
    And sometimes it seems like agencies are being asked to 
peer into a crystal ball, but the courts and the public have 
understood that the hard-look doctrine does not require 
agencies to be perfect or to understand absolutely the 
secondary, tertiary or cumulative effects of programs or 
policies. But the courts and the public do expect them to at 
least try. They want to know that the agencies are not captured 
by a special interest, but are thinking about the balance that 
must be struck between economic and environmental well-being. 
And these stakeholders want to know that all of us are being 
taken into consideration as agencies make decisions.
    After agencies consult with the public, they're required to 
make an informed choice among a reasonable range of 
alternatives. Again, the agencies are not being asked to make a 
perfect decision, they are asked to follow a logic trail using 
a defensible methodology presented in a document that is clear 
and concise, supported by evidence and understandable to the 
public.
    For complex decisions like disposing of chemical weapons or 
permitting genetically modified organisms, NEPA provides a 
structure and a discipline to think rationally and to make a 
decision that takes multiple objectives into account. NEPA is a 
tool for agencies that is so intuitive that even if the law did 
not exist, they would have to create a similar decisionmaking 
process to help them through these complex decisions.
    One of the mistaken practices by the Federal agencies in 
doing NEPA analysis allows them to believe that NEPA does not 
apply to economic impacts. The purpose of the impact is--and I 
quote directly from the statute--``to declare a national policy 
which will encourage productive and enjoyable harmony between 
man and his environment; to promote efforts that will prevent 
or eliminate damage to the environment and the biosphere and 
stimulate the health and welfare of man; to enrich the 
understanding of the ecological systems and natural sources 
important to the Nation.''
    The Congress recognized the profound impact of human 
activity on the interrelationships of all of the components of 
the natural environment, including the indirect effects on 
human dependence--humans' dependence economically on the 
environment. And in particular, Congress acknowledged the 
profound influences that population growth, high-density 
urbanization, industrial expansion, resource exploitation and 
technological advances will have on a natural environment 
should be considered and given a hard look.
    In NEPA, there is clearly an intention to understand the 
relationship between the environment and our economic welfare. 
In addition, there is a requirement in the CEQ regulations to 
balance the economic and environmental factors in 
decisionmaking. For genetically modified organisms, the 
socioeconomic effects are likely to be interrelated with 
environmental effects. For example, the genetic drift of 
genetically engineered traits to nongenetically engineered 
crops, while an environmental effect, could also have 
socioeconomic impacts, such as potential effects on the 
marketability of products in organic markets or with trade 
partners.
    A recent court case affirmed that the modification of a 
plant's genetic makeup through genetic engineering is an effect 
on the environment.
    The linkage between environment, social and economic 
effects is precisely the kind of analysis that Congress 
intended with the statute, and it is precisely the kind of 
linkage that CEQ saw when the regulations were drafted in 1979. 
Whether or not those impacts were significant remains a 
question for the analysts, who must measure significance 
through an understanding of context and intensity.
    Addressing cumulative effects has been a difficult task in 
the simplest of projects, but the regulation of genetically 
modified organisms is not the simplest of actions, but is an 
issue where understanding the potential of cumulative effects 
is critically important. One way that I've always thought that 
we could do something like this is a--taking a hard look--is a 
programmatic approach to environmental impact analysis, and it 
will help reduce paperwork and streamline the NEPA process.
    Programmatic analyses are appropriate in order to implement 
broad decisions for Agency programs, policies or plans. It 
seems particularly useful in broad decisions such as 
genetically modified organisms. However, I remind you of my 
earlier statement that significance is measured by both context 
and intensity. So a programmatic approach would be helpful, but 
if these decisions are applied in a local environment, an 
analyst must look at the biological, physical and socioeconomic 
context where that decision would be applied. In a natural 
ecosystem, a decision may be beneficial to the environment, but 
the same decision analyzed in a different socioeconomic context 
could have a negative effect. That is why programmatic analyses 
must include tiered analyses to look at the local environment.
    Mr. Chairman, I commend APHIS for renewing and revitalizing 
their NEPA regulations. It is needed, and it is past due. I 
have reviewed the APHIS NEPA matrix for the regulated release 
of a genetically modified plant, and I must say this continues 
to be an old way of looking at NEPA, checking a box to get a 
document done. There is not any consideration of context or 
intensity of the potential impact as related to environmental 
or socioeconomic factors.
    You know, APHIS needs to be--needs to move past these old 
ways. They are at a cutting edge of our new world, our new 
economy, and they need to embrace new ways of making these 
crucial decisions that affect all of us.
    There has been much work done in this field in the last 5 
to 7 years, much of it led by the Council on Environmental 
Quality and NEPA practitioners throughout the Federal 
Government, and there are three things that I would think that 
seem directly applicable to APHIS of which I would recommend a 
closer look. One is that APHIS should incorporate an ecosystem 
approach to the decisionmaking beginning at the policy level. 
This requires a more holistic look at what and who are in the 
ecosystem and how the biota are responding to natural and man-
made changes. Regulations are the real opportunity for agencies 
to set policies regarding the NEPA process, and they need to be 
expansive in their thinking about these new regulations.
    Two, incorporate a monitoring and adaptive management 
approach to NEPA. APHIS can therefore spend more time and more 
money on monitoring impacts and less on predicting with 
absolute certainty.
    And finally, incorporate a collaborative way of 
decisionmaking. Organic farmers, farmers using genetically 
modified crops and consumers all have an interest in the 
ecosystem in which they live and work. CEQ has issued a 
handbook on developing collaborative processes, and APHIS 
should examine how better to engage the public.
    In conclusion, Mr. Chairman, thank you for the opportunity 
to provide my thoughts on the matter. APHIS, I believe, has an 
important and unique role to play in the future of our food 
supply and the protection of plants. I am sure that their 
expertise, the willingness of the industry and your oversight 
will produce valuable results for Americans.
    Mr. Kucinich. Thank you very much.
    [The prepared statement of Mr. Clark follows:]

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    Mr. Kucinich. We're going to go to questions. Professor 
Carter has asked the indulgence of the committee and the other 
witnesses since he has a flight to catch. I'm going to go to 
you directly with questions.
    Mr. Carter. Thank you.
    Mr. Kucinich. I take it that you're not opposed to GE crops 
in principle; is that correct?
    Mr. Carter. That's correct.
    Mr. Kucinich. OK. And nevertheless you believe that field 
testing and deregulation of GE crops can have a costly impact 
on farmers when contamination occurs?
    Mr. Carter. Absolutely.
    Mr. Kucinich. You advised USDA to, ``consider which new 
crops constitute a significant economic risk.'' Elsewhere in 
your testimony you state, ``especially when exports are an 
important market outlet,'' and, ``possible buyer resistance in 
the foreign market.'' You said those things, right?
    Mr. Carter. I did.
    Mr. Kucinich. OK. As you know, APHIS almost never prepares 
an environmental impact statement when it permits field testing 
or deregulation of genetically engineered plants. In your 
opinion, have you ever reviewed any other forum where APHIS 
might already do what you advise?
    Mr. Carter. I have not seen any other forum where they've 
done that, no.
    Mr. Kucinich. That is not the point of the EIS, right? That 
is the point, rather, of the EIS?
    Mr. Carter. Correct. But I've not seen that elsewhere.
    Mr. Kucinich. As an economist, do you think that 
preparation of an EIS poses an economic threat to the 
commercialization of GE crops?
    Mr. Carter. Not necessarily. We heard about GM wheat and GM 
rice. I mean, the initial release of, for example, GM wheat, in 
my opinion, should involve an EIS, and ditto for rice. And it 
would not be a threat to the commercial production of that 
crop.
    Mr. Kucinich. Could it have a favorable effect on 
commercialization?
    Mr. Carter. It could.
    Mr. Kucinich. How so?
    Mr. Carter. Well, it could--it could change attitudes and 
views of firms or individuals that buy the crop. If the EIS is 
done properly, and it shows that the benefits far exceed the 
costs, that could change some attitudes and lead to 
commercialization and greater acceptance.
    Mr. Kucinich. What role, Professor Carter--so overall 
you're saying that an environmental impact statement might have 
a favorable--favorable role in influencing consumer 
acceptance----
    Mr. Carter. That's what I'm saying. Thank you.
    Mr. Kucinich. OK. I want to thank the gentleman.
    Mr. Clark, you've had the chance to review APHIS' draft 
programmatic EIS on new regulations pertaining to genetically 
engineered crops.
    Mr. Clark. Yes, I have.
    Mr. Kucinich. It was published 5 months after the Roundup 
Ready alfalfa and creeping bentgrass Federal court decisions, 
which rebuked APHIS for violating NEPA. I wondered if you 
noticed, as I did, that the entire discussion of socioeconomic 
impact is relegated to a 10-page appendix at the end of a 310-
page document?
    Mr. Clark. I couldn't help but notice that, because I was 
looking for--looking for some social economic impact analysis 
within the body. And I have no objection to putting detail 
studies in an appendix of an environmental impact statement; 
however, you're obligated to at least put the meaning of that 
and to simplify that and to make it understandable to the 
public in the main document itself.
    Mr. Kucinich. Would you agree that Judge Breyer's decision 
in Geertson ordered APHIS to make consideration of 
socioeconomic impact central to determination of whether 
APHIS's action is significant under NEPA and requires the 
preparation of an EIS?
    Mr. Clark. I think Judge Breyer's decision was uncommonly 
clear for a Court decision, and it was absolutely the central 
point of the entire opinion.
    Mr. Kucinich. So in your opinion, does APHIS's draft 
programmatic EIS incorporate the directive from Judge Breyer's 
decision?
    Mr. Clark. If I were the decisionmaker, I wouldn't put it 
out the way it is now because I don't think it informs the 
decisionmaker, nor the public.
    Mr. Kucinich. Now, Mr. Clark, Mr. Leake, the grower who is 
here from North Dakota outlined in his testimony a number of 
routes of contamination other than pollination. These other 
routes would include seed left behind in a harvest; the throw-
over from straw choppers, from trucks transporting the 
harvested wheat. And at every link of the chain from field to 
grain elevator to consumer, these routes of contamination are 
more mechanical than the biological routes of contamination 
such as cross-pollination. In your opinion, should these 
mechanical routes of contamination receive equal consideration 
as cross-pollination or the biological routes of contamination 
for the purposes of determining significance under the National 
Environmental Policy Act?
    Mr. Clark. I think clearly the CEQ regulations anticipate 
that you'd follow the impacts wherever they came from. But the 
central point about NEPA and CEQ regulations, that these are 
about decisions, and if a decision by APHIS results in cross-
contamination, it doesn't really matter where it comes from. It 
is either a direct, an indirect or cumulative impact. It still 
must be analyzed in the EIS so that the decisionmaker and the 
public can understand the full import of the decision of APHIS.
    Mr. Kucinich. So you're saying that--you're saying it 
doesn't matter where it comes from. Your answer to the question 
would be, yes, that the mechanical routes should receive equal 
consideration----
    Mr. Clark. It must receive it. It must receive it.
    Mr. Kucinich. So in your testimony you identify a possible 
shortcoming of the decision matrix APHIS developed in response 
to two Federal court decisions last year which rebuked APHIS 
for having no record of consideration of potential 
environmental impact from decisions to permit field testing and 
deregulation of genetically engineered plants. You've said, 
``there is not any consideration of context or intensity of 
potential impact as related to environmental and social 
factors.'' And you've asked, ``how is the timing of the 
proposed GMO release considered in the matrix; how does the 
matrix account for any synergistic or indirect impacts.''
    Do you believe, Mr. Clark, that the decision matrix now 
used by APHIS ensures that its reviewers will fully comply with 
the National Environmental Policy Act?
    Mr. Clark. I don't see for the life of me how that matrix 
will do anything for the decisionmaking because it looks at the 
action. It is looking at the plant itself down to the ground 
and not looking at the environment--not looking at either 
context or intensity.
    Mr. Kucinich. So is that decision matrix sufficient to 
ensure that APHIS complies with the National Environmental----
    Mr. Clark. No, no.
    Mr. Kucinich. And in your testimony you advise APHIS to 
incorporate a collaborative way of decisionmaking and refer 
APHIS to a new handbook on developing collaborative processes 
issued recently by CEQ. Your testimony to farmers, some of whom 
met with and petitioned APHIS to prepare environmental impact 
statements in the past, while APHIS refused their request for 
petitions, at least APHIS met with the farmers. Is that 
sufficient?
    Mr. Clark. That is not collaborative decisionmaking, not on 
anybody's----
    Mr. Kucinich. So describe again a collaborative decision.
    Mr. Clark. Well, collaborative decisionmaking--and let me 
give you some amount of context here--is that there has been a 
very strong push by the Council on Environmental Quality to 
develop collaborative decisionmaking, including cooperating 
agencies, so that counties--counties in which farmers reside 
could easily ask to be a cooperating agency of APHIS so that 
they can use their special expertise with regard to economic 
impacts on the county, on the farming, on the farming community 
there. So being a cooperating agency would be a much more 
collaborative way of doing that. There would be--there is a lot 
more sophisticated collaborative processes that are described 
very well in the CEQ handbook.
    Mr. Kucinich. Thank you, Professor Carter. I appreciate you 
being here. Thank you.
    Mr. Clark. And is available to all of the Federal agencies. 
I won't take the time here to describe them, but I will say 
that the Administrative Procedures Act passed in 1947. Even 
that--even the way that APHIS handled that particular issue 
wouldn't even comply with the Administrative Decisions Act of 
1947.
    Mr. Kucinich. I thank the gentleman.
    I want to go to questions now to Mr. Leake. You said that 
the crop options available to you are limited due to where you 
are. Climate and latitude are factors in your planning options. 
Now, if you couldn't grow hard spring wheat profitably, as you 
fear would occur if a genetically engineered wheat variety is 
approved by APHIS, what could you and others grow profitably in 
its place given your climate and latitude?
    Mr. Leake. I don't think we could continue, because about 
two-thirds of the acreage of North Dakota has planted a wheat 
annually, and the rest of North Dakota, at least northern North 
Dakota, north of Interstate 94, is not suited to corn and 
soybeans. 1994--or 2004, 2005 or 2006 we had failures or 
disappointing yields for corn in the northern two-thirds of 
North Dakota because it requires a lot of moisture and a lot of 
heat to grow corn and soybeans to get the yields necessary to 
be profitable.
    So we are, as has been mentioned before, very dependent on 
cool-weather crops, small grains being one of those. However, 
we do have some other options, which are specialty crops, such 
as navy beans, pinto beans, black beans, edible bean crops and 
sunflower. However, there is limited demand for those 
particular commodities, so we wouldn't be able to substitute 
those crops into the acreage that wheat now is grown on and 
still have a price because the supply would exceed the demand.
    Mr. Kucinich. Now, you've written in your testimony that if 
a contamination event like the StarLink case would happen to 
wheat crops, the effects would be much worse on farmers. You 
note that a greater share of the wheat crop is sold on the 
export market, and the animal feed market isn't a viable 
backstop for wheat that can't be--that wheat can't be sold for 
human consumption. Did you make those arguments to APHIS when 
you were seeking an EIS for Roundup Ready wheat?
    Mr. Leake. Yes, we did.
    Mr. Kucinich. What did APHIS say?
    Mr. Leake. Basically when we met with--in March 2004 with 
Undersecretary Hawkes and the Acting Director of APHIS, we put 
that argument forth to them. Their final decision on that was 
not to grant an environmental impact statement. I guess that 
says it.
    Mr. Kucinich. What did they say to you, though? Was there 
anything else said?
    Mr. Leake. Basically the Under Secretary said it was--that 
they didn't have the authority to pursue an EIS to give us the 
input into the decision on the petition for deregulation.
    Mr. Kucinich. Did APHIS show you any evidence that they had 
seriously considered the concerns you were raising?
    Mr. Leake. No. No, they did not.
    Mr. Kucinich. How did that make you feel? What did you 
think about that?
    Mr. Leake. I felt very shut out of the process. I felt like 
it wasn't a democratic process, that I was a stakeholder--it 
was my livelihood at stake, and that I wasn't given any 
consideration, and that the company that was pursuing the 
deregulation of the Roundup Ready wheat was given 
consideration, but I as a grower was not.
    Mr. Kucinich. And when that happened--because growers by 
nature have to look forward--what was going on in your mind 
when you looked forward from that moment based on the way it 
was being handled where they didn't really show any real, you 
know, connection to your concerns?
    Mr. Leake. Well, in the past, the other Roundup Ready 
crops, such as soybeans and corn, had been deregulated and 
introduced into the marketplace. Using that as an example, I 
fully expected them to deregulate Roundup Ready wheat, and it 
would be introduced within a year or two. We had been warned 
directly by our customers in numerous formats, numerous times 
and places, that they would not access our wheat supplies for 
importation if we were to be--have GE--or GE crops growing 
commercially in the United States. And that actually started to 
happen. So I felt----
    Mr. Kucinich. Would you say--what? Would you repeat that?
    Mr. Leake. Prior--prior to the introduction of any GE 
wheat, some of the milling companies in Europe, Ranco was one 
of them, I believe, was starting to develop commercial ties 
with wheat suppliers in Kazakhstan and the Ukraine in 
anticipation of a GE wheat supply from the United States and 
Canada. This is just business. They anticipated that it would 
be commercialized; therefore, they could not utilize U.S. wheat 
supplies. They sought them elsewhere, as they said they would.
    Mr. Kucinich. Now, how--has this affected you financially?
    Mr. Leake. The--of course, the Roundup Ready wheat 
deregulation never occurred. So we are still GE-free, and 
GIPSA, the Grain Inspection, Packers and Stockyards 
Administration, still issues its letterhead statement that U.S. 
wheat supplies are GE-free. And that is required by most of the 
customers that we export our harvest spring wheat to. That has 
become the--a pivotal document for them to keep accepting U.S. 
wheat exports.
    Mr. Kucinich. Your testimony states that the EIS, 
``provided the best opportunity to present,'' the case of 
concerned wheat growers about the risk of Roundup Ready wheat. 
Why, in your opinion, is the public comment period for an 
environmental assessment or meetings that you have had with 
APHIS officials not an adequate forum for presenting your case?
    Mr. Leake. Well, a comment period doesn't have the same 
ability to garner comments as would be the scoping process of 
an EIS. During a--scoping meetings, they are held in the areas 
where people would be affected. They're invited to come and 
voice their concerns. That is incorporated into the EIS draft. 
And we also have an opportunity to comment on the draft EIS. 
This isn't necessarily available in the EA. So I felt that, you 
know--as a person of North Dakota, I've seen a lot of EIS 
scoping notices go out on a lot of projects, etc. People have 
the opportunity to come en masse to voice their concerns. The 
administrative process of an EA basically shuts out most of the 
concerned people.
    Mr. Kucinich. Do you think that APHIS based their rejection 
of your petition on--to prepare an EIS to, you know, hard look 
at the risk, they base that on science and economics, in your 
opinion?
    Mr. Leake. I don't think so, because it is quite apparent 
to everyone, especially anyone who is involved in farming--
Under Secretary Hawkes, when we talked to him, he told me that 
he was a wheat farmer. I'm quite sure that he was cognizant of 
the simple process of the economic implications of not being 
able to export wheat when wheat is--when half the wheat crop in 
this country is exported. We would find a drop in price.
    Mr. Kucinich. Thank you, Mr. Leake.
    Mr. Howington, you raise GE soybeans, but you're here 
testifying on the effects of unauthorized GE rice release.
    Mr. Howington. Yes, sir.
    Mr. Kucinich. I take it you're not opposed to GE crops in 
principle?
    Mr. Howington. In principle, no, sir.
    Mr. Kucinich. OK. Do you think your advocacy with APHIS for 
an environmental impact study that analyzed the effects of 
contamination is anti-GE crop in principle?
    Mr. Howington. No, sir, not at all.
    Mr. Kucinich. Why would a grower of GE crops have a concern 
about the development of new GE crops?
    Mr. Howington. My concern is not with--my concern is with 
contamination. When they call it contamination, and it comes 
out of my pocketbook, that is my concern.
    Mr. Kucinich. You state that many rice farmers--I think you 
said about 600 in your testimony--went out of business after 
the LibertyLink rice contamination event. You yourself now 
lease out your own land to neighboring farmers, and you don't 
farm rice anymore.
    Mr. Howington. That's correct.
    Mr. Kucinich. When one farmer quits and another gets 
bigger, the total number of farmers decreases, and 
concentration in the industry increases. This has historically 
been a great deal of--there has historically been a great deal 
of concentration in the farming business. Is additional 
concentration in farming attributable to the economic effects 
of contamination by GE crops as an impact people should be 
concerned about?
    Mr. Howington. Yes, sir. There are a number of things that 
contribute to that, but certainly the genetic event we had in 
2006, farmers quit simply because of the economic effects of 
that event.
    Mr. Kucinich. I want to go into this just a little bit. You 
had the Liberty rice--LibertyLink rice contamination event.
    Mr. Howington. Yes, sir.
    Mr. Kucinich. Once you learned of that, walk me through 
what happened. You know, how did you find out about it?
    Mr. Howington. We found out about it, and it was--in our 
part of the world, agriculture is--it is like politics in 
Washington. It's what goes on. It was on in every paper, it was 
on every news, it was on all of the reports. It was everywhere.
    Mr. Kucinich. As soon as that happened, what did you do?
    Mr. Howington. I tried to find out what the consequences 
were going to be for me; wondered what my crop was going to--
what was going to happen to my crop, my price, my market.
    Mr. Kucinich. Would you tell this committee for the record 
what did happen?
    Mr. Howington. The price dropped. It dropped precipitously 
and very quickly. Unfortunately, I didn't have a lot of my crop 
priced, which was very common at that time. Rice prices were 
headed up. We were hoping for a rise in prices. It went the 
other way.
    Mr. Kucinich. What happened to you?
    Mr. Howington. They went the other way.
    Mr. Kucinich. What happened to you?
    Mr. Howington. That year I didn't get as much for my rice 
as I was hoping I would.
    Mr. Kucinich. How much of a loss did you take?
    Mr. Howington. I would say in the $50,000, $60,000 range.
    Mr. Kucinich. What does that mean for a small farmer?
    Mr. Howington. A fellow like me whose disposable income is 
less than that, meant a lot.
    Mr. Kucinich. Did it wipe you out?
    Mr. Howington. I don't want to use the term ``wiped me 
out.'' I'd say it----
    Mr. Kucinich. Damaged you severely?
    Mr. Howington. It damaged me severely. Farming is a huge 
risk.
    Mr. Kucinich. It is a family thing, too. What can you tell 
us about--what kind of effect did this have on your family?
    Mr. Howington. Well, I mean, this is a farm that has been--
my grandfather literally cleared this land. My father developed 
it and leveled it, put wells on it. I came along and farmed it. 
And I farmed it, started full time in 1980, and it just--the 
economics of the situation just--and the risk. That is the big 
thing about farming, it is a huge risk. As I say, my disposable 
income was less than the $50,000, $60,000 I lost in that event.
    Mr. Kucinich. So tell us about how you felt, though, 
because, you know, a lot of times this stuff gets academic 
until it comes down to a personal level. How did it feel?
    Mr. Howington. It was a horrible feeling. It is a--when you 
realize that where you stand on the totem pole in this deal--
obviously throughout this deal, what was going to happen to the 
farmer was the last consideration. And when you realize where 
you stand on the totem pole, it is devastating to you. As 
farmers, we go out every day and we work hard. We work very 
hard. We risk a lot, you know. And when something like this 
happens, it is very depressing, very demoralizing.
    Mr. Kucinich. You know, I appreciate you and the witnesses 
here telling their personal stories because it helps people 
connect with it. They've got to be in your place. This is your 
grandfather's farm.
    Mr. Howington. Yes.
    Mr. Kucinich. I mean, this is why I've gone into 
questioning you in a little bit different way here because I 
think we need to really understand the impact this had on you. 
This is--again, there is a lot about this debate that cannot be 
academic. This affects people's lives in huge ways.
    Mr. Howington. Well, this is a family farm that went by the 
wayside. It was not the only one by any means that was--that 
this event contributed to.
    Mr. Kucinich. I want to thank you for your testimony, Mr. 
Howington, as well as all the other witnesses.
    I have some questions for Mr. Kirschenmann. In their EA for 
Roundup Ready alfalfa, APHIS made the following statements with 
regard to RR alfalfa's negligible impact on organic alfalfa. 
They said, ``fields''--talking about alfalfa--``are typically 
harvested before the seed is set and allowed to mature because 
high-quality forage is the desired product.'' That is page 14. 
And they also said, ``organic production operations require to 
have distinct, defined boundaries and buffer zones to prevent 
unintended contact with prohibited substances from enjoining 
land that is not under organic management.'' That is on page 
13.
    Now, do these statements from USDA persuade you that USDA 
gave serious consideration to the question of impact on organic 
farming?
    Mr. Kirschenmann. I think they gave serious consideration 
to an abstract farm. They didn't give serious consideration to 
a real farm because--the reason I say that is----
    Mr. Kucinich. What do you mean by that?
    Mr. Kirschenmann. What I mean by that is what they describe 
is true in theory, but on a real farm you have events like 
unusual rainfalls, when you can't get in to harvest your 
alfalfa crop in time before it goes to bloom; or you may have a 
low area in a corner of a field that you can't get into for 
several weeks if you have had a lot of rain. Or you may have a 
drought situation where your alfalfa never gets to a point 
where it is worth cutting. And so, then, you know, are we 
really going to expect farmers to cut all that alfalfa just so 
it doesn't go to bloom? I mean, I think that is pretty 
unrealistic. So in a real farm, you have those kinds of real 
situations that don't always work as they seem they should work 
in theory.
    Mr. Kucinich. So is it possible that they developed this 
approach with the advice of farmers?
    Mr. Kirschenmann. A little doubtful.
    Mr. Kucinich. I'd like to add to the record----
    Mr. Cameron. Mr. Chairman, could I add something to that?
    Mr. Kucinich. Yes. I mean, I'd be happy to have you join 
into this. Please do.
    Mr. Cameron. I am a real farmer. I grow Roundup Ready 
alfalfa 200 yards away from my organic alfalfa. I'm not saying 
that you couldn't come up with a situation to where you could 
have a problem, but I think good stewards of the land, good 
farmers, we cut our hay actually prior to bloom.
    I agree. We live in California. It doesn't rain much. When 
it does, it rains in the winter. But I feel confident I could 
grow Roundup Ready alfalfa side by side to organic alfalfa and 
not have an issue with contamination or adventitious presence. 
So what I do understand--there are other situations in the 
United States, but----
    Mr. Kucinich. Well, I think he has kind of implied that 
your conclusions would be defined by the climate and latitude a 
little bit. I mean, they have to have some impact on it, right?
    Mr. Cameron. True. But I agree. If you're going to be an 
economic farmer, you not going to--you don't want your alfalfa 
to bloom in the first place. If it does bloom, the time between 
there and the time that you set the seed is quite some time.
    Mr. Kucinich. I'm not a farmer, but here is the thing I 
want to ask you, if I may, Mr. Cameron. This same question that 
we're talking about, the Federal judge, here is what this 
Federal judge concluded. I want to quote this to see what you 
think, and then I'd like Mr. Kirschenmann to comment on it, 
too. Talking about APHIS: ``APHIS made no inquiry into whether 
those farmers who do not want to grow genetically engineered 
alfalfa can, in fact, protect their crops from contamination, 
especially given the high geographic concentration of seed 
farms and the fact that alfalfa is pollinated by bees that can 
travel more than 2 miles. Neither the EA nor the FONSI 
identify--FONSI, it is called--identify a simple method that an 
organic farmer can employ to protect his crop from being 
pollinated by a bee that travels from a genetically engineered 
seed farm, even assuming the farmer maintains a buffer zone.''
    Now, that is what the Federal judge said in this case. What 
do you think about that?
    Mr. Cameron. I think your seed requirements are much 
different than your typical growing of the forage requirements 
should be. I think separation of a seed grower should be much 
different than a traditional forage grower.
    Mr. Kucinich. Well, Mr. Kirschenmann, what do you think 
about that in terms of the impact on organic farming?
    Mr. Kirschenmann. Well, the thing that--I mean, I want to 
commend Mr. Cameron, because he is apparently managing his 
system very well, but, again, when you look at the situation in 
terms of rank-and-file farmers, not every farmer, as in any 
other field, is equally competent, is equally capable of 
controlling systems.
    The thing that is disturbing to me is that we keep having 
these claims that we have this under control, that there is no 
problem and no danger of contamination, and yet just here 2 
weeks again we had, you know--so, you know, it is--the fact 
that--Charles Perot at Yale University published a book back in 
the late 1980's called Normal Accidents, and the case that he 
made in that was--the reason he called them normal accidents is 
because they happen. You can't manage any system constantly 
perfectly. There are going to be mistakes that are going to be 
made. And the problem in this system, you know, for me and my 
farm, if somebody makes a mistake, I can't--I can't undo that 
mistake. It harms me economically. And this is why we made the 
decision on our farm not to grow any crops that have a GMO 
counterpart. Now, that works for us now as long as we continue 
to have a range of crops that we can grow effectively in our 
rotation and have markets for them. That probably is not going 
to be the case very far into the future if we continue, you 
know, bringing new crops into the situation.
    And so, you know, I agree that there may be an individual 
case here and there where you can demonstrate that you can 
manage it, there isn't a problem. But if you look at the 
situation and the market as a whole, you can't make that case. 
The evidence is too clear.
    Mr. Kucinich. Well, I want to thank all of the witnesses 
for their participation. Each of you came here to communicate 
experience, which is going to be valuable in the committee 
being able to make some determination as to where we go. And we 
have a variety of experience here, and I think that it is very 
helpful.
    Again, this is not the hearing to determine whether the GE 
technology is good or bad. We're looking at what is APHIS doing 
or what is USDA doing. That is the committee's charge here. So 
I want to thank you for shedding some light on this.
    I'm going to dismiss the first panel with the gratitude of 
the committee. Thank you. And we're going to--as they're 
leaving, we're going to get ready for the presentation from the 
next panel, which will consist of the Administrator of the 
Animal and Plant Inspection Service [APHIS], U.S. Department of 
Agriculture, Cindy Smith.
    [Recess.]
    Mr. Kucinich. Before we begin, The administrator has 
informed the committee that one of her assistants is going to 
be present. You know, I want to acknowledge that there are 
areas here that can become very complex, and if I was in the 
shoes of the Administrator, I would certainly want to have 
someone nearby who could assist in making sure that the 
committee gets the, you know, best information that we can. So 
I want to acknowledge the gentleman. And since you'll be 
assisting in this, I would ask you to also be sworn so that we 
can have concurrence in our testimony here. Would both of you 
please stand and raise your right hands?
    [Witnesses sworn.]
    Mr. Kucinich. Thank you. Let the record show that the 
witnesses answered in the affirmative.
    I'd like the gentleman to give his name and his position 
and his function in the office of the Animal and Plant 
Inspection Service.
    Mr. Gregoire. Mr. Chairman, I'm Michael Gregoire.
    Mr. Kucinich. And would you bring your microphone closer? 
Would you spell Gregoire for the staff here?
    Mr. Gregoire. Yes. It is spelled G-R-E-G-O-I-R-E. Michael 
Gregoire. I'm the Deputy Administrator for Biotechnology 
Regulatory Services in the Animal and Plant Health Inspection 
Service.
    Mr. Kucinich. OK. OK. And with us is Cindy Smith, who is 
the Administrator of the Animal and Plant Inspection Service of 
the U.S. Department of Agriculture. I want to thank both of you 
for being here, and I would like Ms. Smith to commence with her 
testimony.

   STATEMENT OF CINDY SMITH, ADMINISTRATOR, ANIMAL AND PLANT 
  HEALTH INSPECTION SERVICE, U.S. DEPARTMENT OF AGRICULTURE, 
   ACCOMPANIED BY MICHAEL GREGOIRE, DEPUTY ADMINISTRATOR FOR 
  BIOTECHNOLOGY REGULATORY SERVICES, ANIMAL AND PLANT HEALTH 
       INSPECTION SERVICE, U.S. DEPARTMENT OF AGRICULTURE

    Ms. Smith. Mr. Chairman, thank you for the opportunity be 
here today.
    APHIS is responsible for ensuring that biotechnology-
derived crops are as safe for agriculture and the environment 
as their traditionally bred counterparts. Over the last 20 
years, APHIS has effectively overseen the safe adoption of 
products of biotechnology, with 12,000 field trials grown under 
our notification procedures and 1,500 field tests grown under 
the permitting process, encompassing field trials at 79,000 
different locations. In addition, we have deregulated more than 
70 products in that time.
    APHIS is a leader globally in biotechnology regulatory 
experience. In 2002, we recognized, though, that there were 
still more--that there was still more that we could do to 
better position the Agency to respond to the evolving science 
and growth of biotechnology. That was when BRS was created, and 
I became the Deputy Administrator of the program.
    Since then, we've made a number of significant improvements 
to APHIS's biotechnology regulation. APHIS has committed 
increased resources to our regulatory activities. BRS's budget 
has grown by more than 200 percent in the past 6 years. Staff 
levels have increased from 25 to 60 employees. We have placed 
more focus on key regulatory areas and created dedicated staff 
for these functions. For example, we established a dedicated 
compliance and enforcement unit in BRS in 2003. We've automated 
the regulatory and compliance processes and made a number of 
significant regulatory changes, as well as numerous revisions, 
to permit requirements. We now have in place stricter measures 
for crops producing pharmaceutical and industrial compounds, 
not only increasing requirements for the regulated community, 
but also APHIS's role in the oversight of these products. 
Additionally, we recently launched a new voluntary quality 
management system for biotechnology developers to foster--to 
help foster industry commitment to quality controls, quality 
management and quality compliance.
    I share this committee's respect for the National 
Environmental Policy Act [NEPA]. We have made a number of 
changes to ensure environmental impacts of our proposed actions 
are fully considered. We are undertaking comprehensive 
programmatic as well as product-specific EISs. Our first 
programmatic draft EIS, which was published in July 2007, will 
lay the groundwork for a comprehensive updating of our Federal 
framework.
    Our environmental assessments now contain much more 
detailed scientific analysis and include more scientific 
references, analysis of effects on organic protection, and a 
toxicity table for effects of biotechnology-derived crops on 
nontarget insects. We have also enhanced our documentation for 
categorical exclusions from NEPA, more closely analyze 
cumulative impacts, and put in place a formalized process with 
the U.S. Fish and Wildlife Service to ensure compliance with 
the Endangered Species Act. We made a number of these changes 
even before the court rulings directing us to better document 
our environmental analysis, and other changes came after as our 
understanding of what the courts expected of our NEPA 
documentation evolved and we continued our commitment to 
meeting our environmental obligations.
    Mr. Chairman, let me focus the remainder of my remarks on 
last year's situation regarding Roundup Ready alfalfa, as well 
at NEPA regulatory changes we're considering, as those were 
areas you were interested in.
    APHIS had prepared an environmental assessment [EA], to 
determine whether deregulating the alfalfa could have a 
significant impact on the environment, and issued a finding of 
no significant impact [FONSI]. In order to comply with the 
preliminary injunction, APHIS brought Roundup Ready alfalfa 
back under regulation until the Agency issues a new 
determination consistent with the court's requirements. The 
court did not overturn Federal conclusions regarding the safety 
of the crop for food or feed purposes, but rather concluded 
that APHIS had not adequately documented potential 
environmental effects.
    Again, we are taking this opportunity to examine and 
strengthen our NEPA processes. APHIS already considers the 
social and economic impacts of a proposed action in those cases 
where there is a clear relationship with environmental impacts. 
We are strengthening our documentation in this area, both in 
our recent regulatory decisions and in the alfalfa EIS being 
drafted. And I look forward to our continued learning in this 
area as we gain a better understanding of how to apply the NEPA 
process to inform our decisionmaking.
    APHIS is also in the process of promulgating a proposed 
rule that will make changes to how we implement procedures 
under NEPA aimed at providing further clarity to this process. 
These potential changes would more closely tie our decision to 
prepare an EIS to the language in NEPA. These and other changes 
we are considering would also clarify that we base our 
decisions to prepare an EIS or EA on an action's potential 
effect on the environment.
    Mr. Chairman, my statement for the record includes much 
more detailed information regarding our regulatory system for 
biotechnology crops, as well as steps we are taking now to 
enable us to continue regulating the next generation of 
products. Let me conclude by saying that our actions today to 
revise and strengthen our regulations, as well as learn from 
our previous experiences, will hold us in good stead for the 
future.
    I look forward to answering your questions. Thank you again 
for the opportunity to testify before the subcommittee.
    [The prepared statement of Ms. Smith follows:]

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    Mr. Kucinich. Thank you very much.
    I have some prepared questions. But before I get to them, 
you sat back there and you heard the testimony of the farmers. 
And you know, you heard Mr. Howington talk about how his 
grandfather had that farm and then what happened with the 
LibertyLink rice. What about that? When you hear that from a 
farmer, do you think that maybe somebody failed somewhere?
    Ms. Smith. Well, I guess I have a number of reactions. It 
certainly emphasizes how seriously we took this situation when 
it occurred. It emphasized the decisions we made at the time to 
go contrary to some of our historical procedures in terms of, 
we historically complete an investigation in terms of a 
situation such as this before we start talking publicly about 
it so we don't compromise the nature of the investigation. But 
what became very clear to us was that we wanted to make sure 
the farmers knew everything they could to help them prepare for 
the planting season. And so we made two separate announcements, 
kind of contrary to what our historic policy had been, letting 
farmers know about what we had learned. And in addition, 
another thing that we did was when we learned about the second 
rice-related event, we took immediate measures, within hours, 
and we stopped--I may not have the number exactly right--but I 
think it was in the neighborhood of 98 percent of all the 
Clearfield rice that was moving to farmers to plant, so that 
what happened was very--I think there may have been potentially 
one farmer that planted a very small spot of Clearfield. So we 
are very empathetic absolutely, and that is partly what drove a 
lot of the actions that we took during the situation.
    Mr. Kucinich. Well, I mean, after all, two Federal judges 
concluded that APHIS was in violation of NEPA in two separate 
genetically engineered plant cases. And in these cases, APHIS 
review of the deregulation application for Roundup Ready 
alfalfa and the field testing of Roundup Ready creeping 
bentgrass were deemed by the courts to be inadequate, 
``arbitrary and capricious,'' and in violation of NEPA. Now, 
you have not appealed these judges' decisions as relate to 
violations of NEPA; have you?
    Ms. Smith. Actually, we are not. We have an appeal on one 
of the cases, but we are not disagreeing with the judges' 
determination that we were in violation of NEPA.
    Mr. Kucinich. Well, APHIS is now preparing an EIS in both 
cases, though, is that right?
    Ms. Smith. That is correct.
    Mr. Kucinich. And I wanted to ask you a question about 
APHIS's reaction to those judges' decisions. As you are aware, 
in the alfalfa case, Judge Breyer concluded, ``APHIS made no 
inquiry into whether those farmers who do not want to grow 
genetically engineered alfalfa can in fact protect their crops 
from contamination.'' He went on to say neither the EA nor the 
FONSI identify a single method that an organic farmer can 
employ to protect his crop from being pollinated by a bee that 
travels from a nearby genetically engineered seed farm even 
assuming the farmer maintains a buffer zone. And Judge Breyer 
said, ``Neither the EA nor the FONSI contain any reference to 
any material in support of APHIS's conclusion that gene 
transmission is highly unlikely to occur with reasonable 
quality control.''
    Ms. Smith, do you now feel that APHIS had to make such an 
inquiry to comply with the National Environmental Policy Act.
    Ms. Smith. The Court directed us to do so, so that's 
exactly what we are doing, and that's what we have been doing 
in all of our regulatory decisions since that time.
    Mr. Kucinich. And do you now feel that APHIS has to show 
the analysis involved in making the inquiry to comply with 
NEPA?
    Ms. Smith. Absolutely. One of the realities that we faced 
is that we have a staff of scientists that are top notch 
experts in terms of science. What we have not historically done 
as good a job with is to help them understand how to document 
our requirements under NEPA. And so while our scientists have 
looked at these issues, have discussed them, we have had much 
conversation and dialog and research happen, we have not 
adequately documented in this case what we needed to.
    Mr. Kucinich. Well, let's go back to Judge Breyer for a 
second. I am going to read some more things, see if we can come 
to agreement here. Judge Breyer, ``an action which potentially 
eliminates or at least greatly reduces the availability of a 
particular plant, here nonengineered alfalfa, had a significant 
effect on the human environment.'' And he said, ``the 
significant impact that requires the preparation of an EIS is 
the possibility that the deregulation of Roundup Ready alfalfa 
will degrade the human environment by eliminating a farmer's 
choice to grow nongenetically engineered alfalfa.'' Does APHIS 
now agree that the possibility of genetic contamination causing 
a narrowing of farmer choice is a significant impact under the 
National Environmental Policy Act?
    Ms. Smith. What we are doing is looking at any situation in 
which an environmental decision will have a significant 
environmental impact and that will also have a related economic 
impact, which is what the judge directed us to do.
    Mr. Kucinich. So you are saying you basically agree then? 
You agree?
    Ms. Smith. You are asking, do we agree that there could be 
a significant impact of a contamination situation? Is that what 
you are asking?
    Mr. Kucinich. I will ask it again. I just want to make sure 
that we have precision here. Does APHIS agree now that the 
possibility of genetic contamination causing a narrowing of 
farmer choice is a significant impact under NEPA?
    Ms. Smith. What we have to do is look at the environmental 
decision, environmental impact, and then look at the economic 
impacts associated with that. And so that's what we are doing. 
And so you could envision a situation in which that could be 
the case.
    Mr. Kucinich. But do you agree with that? Do you agree with 
Judge Breyer's assessment?
    Ms. Smith. You know, since the judge gave us the order, we 
are going to do exactly what the judge has told us to do. So we 
are looking in that avenue, and we are putting the resources 
into making sure that we have done a very thorough 
environmental analysis as well as economic analysis for all 
aspects of that.
    Mr. Kucinich. You haven't appealed that aspect of the 
judge's decision.
    Ms. Smith. No, we have not.
    Mr. Kucinich. OK. Just again, using Breyer's decision to 
look at the way you look at these things, he said, ``APHIS 
argues in its brief that the extent of any gene transmission is 
in any event irrelevant because NEPA requires an agency to 
consider physical environmental impacts, not economic or 
financial impacts. APHIS overstates the law.'' He goes on to 
say the economic effects on the organic and conventional 
farmers of the government's deregulation decision are 
interrelated with, and indeed a direct result of, the effect of 
the physical environment, namely the alteration of a plant 
species' DNA through the transmission of a genetically 
engineered gene to organic and conventional alfalfa. APHIS was 
required to consider those effects in assessing whether the 
impact of its proposed action is significant. But its reasons 
for concluding that the effect on organic and conventional 
farmers is not significant are not convincing. Now, when Judge 
Breyer refers to economic effects being interrelated with 
environmental impacts and significant, he is quoting from the 
National Environmental Policy Act's implementing regulations. 
Does APHIS now agree with Judge Breyer that determining the 
significance of a proposed action under NEPA requires 
considering economic impacts interrelated with environmental 
impacts?
    Ms. Smith. We do agree that if there are environmental 
impacts and economic impacts associated with those, that they 
need our full analysis, and we will do so in our NEPA analysis, 
whether it is in an environmental assessment or an 
environmental impact statement.
    Mr. Kucinich. We have just reviewed a number of areas of 
Judge Breyer's decision. And it appears that APHIS is ready to 
incorporate those judicial rulings into your interpretation of 
your NEPA obligations. Is that correct?
    Ms. Smith. It is correct that we recognize that where there 
is an environmental impact, a significant environmental impact, 
that we have to consider the economic impacts related to that, 
yes, sir.
    Mr. Kucinich. So what are the lessons that you have learned 
about NEPA obligations from Judges Breyer and Kennedy?
    Ms. Smith. The fundamental thing that we have learned is 
that we have to do a better job of documenting the work that we 
are doing. In the previous case, it led us to develop a number 
of documents to document more precisely whether we need to do a 
categorical exclusion or an environmental assessment. And just 
in terms of a point of clarification regarding the previous 
testimony you heard regarding our documentation we provided 
you, the documentation we provided you is not intended in any 
way to be our environmental analysis that we conduct, an 
environmental assessment or an EIS. That documentation is to 
very clearly----
    Mr. Kucinich. I am glad you pointed that out.
    Ms. Smith [continuing]. Very clearly to help us determine 
if that regulatory decision is something that can be 
categorically excluded from NEPA, from a full NEPA analysis, or 
if it needs an environmental assessment. And so it is just a 
start in terms of our just looking at just the categorical 
exclusion decision.
    Mr. Kucinich. You have a new decision matrix?
    Ms. Smith. We have the matrix we gave you, but that is only 
in terms of only determining whether a categorical exclusion 
applies or if we need to do an environmental assessment, which 
would be an alternative to that.
    Mr. Kucinich. Since the Breyer and Kennedy decisions, is it 
fair to say you have a new decisionmaking matrix?
    Ms. Smith. We have strengthened our documentation, that's 
correct.
    Mr. Kucinich. But it is also--I just, you know, just to 
make sure we are going in the right direction here, the 
decision--any decision matrix could be calling for minimal 
compliance. Are you, in terms of the compliance meter, are you 
looking for minimal compliance or are you looking to really 
comply fully?
    Ms. Smith. Right. I don't want to confuse issues here. The 
purpose of these matrices that we have developed, and I think 
one has 30-some specific aspects that we are looking at, we 
have questions in that matrix to help us make sure that we 
consider every aspect that is relevant in terms of a decision 
on a categorical exclusion. And in one case, we learned--our 
lesson learned from one case is that we had to do a better job 
of documenting that something qualifies for a categorical 
exclusion. We made changes. We did a good job of that. In the 
next case, the judge ruled we did document the categorical 
exclusion appropriately, but we failed to document the 
exceptions to that categorical exclusion. And so that is the 
new matrix that you see that we developed as a result of the 
second case.
    Mr. Kucinich. Will APHIS broaden its interpretation of 
significant impact so it comes into line with the court's 
interpretation in Geertson----
    Ms. Smith. I think historically we have, and in the EA that 
you saw, we took a more closely related to plant pest authority 
evaluation of the situation, which is what our regulatory 
authority is. What we heard clearly from the judge is that for 
any situation in which there is a significant environmental 
impact, we have to consider the economic impacts. And so we are 
doing that.
    Mr. Kucinich. So let's talk about Geertson again. Are you 
looking at the economic impact on farmers resulting from 
potential contamination?
    Ms. Smith. Yes, we are.
    Mr. Kucinich. OK.
    Ms. Smith. Specifically, I could add, if you are 
interested, when we announced the EIS, one of the specific 
areas that we announced that we are scoping for is the economic 
impacts of Roundup Ready on nonbiotech adopters.
    Mr. Kucinich. A nonbiotech----
    Ms. Smith. Adopters. So in other words, your organic 
farmer, your traditional farmer that is not growing any 
biotech.
    Mr. Kucinich. Are deregulation decisions of GE plants 
inherently likely to have significant environmental impact?
    Ms. Smith. That would be based entirely on the nature of 
the crop and the trait that has been incorporated into the 
crop. And that is why we do a very specific deregulation 
decision for each one of those applications.
    Mr. Kucinich. I mean, you look at the International Center 
case and what Judge Kennedy said, he said he considers the 
significance that the size of test plots, the number of test 
plots with field tests have in determining environmental 
impacts. Logically, wouldn't deregulation decisions which allow 
the unrestricted commercial transport of GE crops, thereby 
enabling the unlimited planting of GE crops, pose an even 
greater environmental impact?
    Ms. Smith. That is possible. And we would not make a 
deregulation decision unless we determine that crop that is 
being proposed was entirely safe for the environment and 
agriculture.
    Mr. Kucinich. So should proposed deregulations in this--you 
know, in these areas require an environmental impact?
    Ms. Smith. In September 2004, as the deputy of BRS, I made 
a decision that the creeping bentgrass petition application was 
such that, due to the nature of the crop, it was necessary for 
us to conduct an environmental impact statement.
    Mr. Kucinich. As you know, APHIS has prepared a draft 
programmatic EIS in connection with its intention to promulgate 
new biotech crop regulations. Now, my staff has reviewed the 
draft EIS carefully, and we are left wondering if it reflects 
any lessons learned from the rebuke that APHIS received from 
two Federal courts last year. For instance, take its discussion 
of socioeconomic impacts. Discussion of those impacts again 
goes to that 10-page appendix at the end of the 310-page 
document. And you have already responded to that. Is that----
    Ms. Smith. No, you are asking now, why is that information 
in an appendix in that document? And I give you two answers for 
that. First, you referenced the size of that document. And so 
that should give you a sense of the commitment that we took in 
terms of the scientific analysis that we conducted to complete 
that EIS. We had some challenges, though, and we worked with a 
consultant on how to make that document something that would be 
very easy for the public to read, because it is very important 
for us as a regulatory agency in terms of the public confidence 
in the system and in terms of our making sure that we are 
complying with NEPA to the spirit of NEPA that document can be 
as very transparent and can be read well. And I think what we 
heard from Judge Breyer was the recognition that we need to 
look at those environmental impacts, but the critical thing for 
us to consider is the environmental impacts, and then we are 
considering the economic impacts as they relate to the 
environment. So that would make sense that the environmental is 
the main core of your EIS. One thing, though, that we should 
clarify, too, is that Judge Breyer's decision was on a product-
specific EIS as opposed to our programmatic EIS, which is on 
our full regulatory system. And I would tell you, we place no 
less importance on the analysis wherever it is in the document. 
We did all that analysis, conducted that all in a very 
comprehensive way over a period of years. And the fact that it 
ended up in an appendix was really more of a decision to help 
the document be easier to read.
    Mr. Kucinich. OK. We have a 310-page document we are 
talking about here. There is an assertion, on page 121, ``four 
factors were considered in the evaluation of biological 
impacts: too negative of an impact; the geographic extent; its 
duration and frequency; and the likelihood of its taking 
place.'' There was no mention of economic impacts, or take the 
fact that apart from the 10-page appendix, there are only five 
mentions of the phrase socioeconomic impacts and only 10 
mentions of the word contamination. I am just wondering, in 
light of Judge Breyer's decision, if economic impacts of 
contamination should have been integrated into the body of the 
EIS and the analysis of significance and had been discussed 
more extensively. It still makes me wonder, did you really get 
the message when I don't see it discussed in any extensive 
manner?
    Ms. Smith. I would say one point is that it is important to 
recognize, in order for us to do good analysis, we have to have 
enough specificity in what we are analyzing----
    Mr. Kucinich. Indeed.
    Ms. Smith [continuing]. To be able to project. So where we 
are going to have the ability to have much more specificity is 
going to be on a crop-specific EIS as opposed to a 
programmatic. In the programmatic EIS, we have to look very 
broadly at the whole regulatory system and look very broadly at 
the kinds of issues we are evaluating. And then what we will be 
doing is using this as the basis to tier to very specific crop-
based analysis. In addition, it is important to recognize that 
when we issue our proposed rule, which we hope to do before too 
long, there will be a separate very specific economic analysis 
that will associate, be associated with the issuance of that 
rule.
    Mr. Kucinich. When you say separate----
    Ms. Smith. We are required to publish at the same time an 
economic analysis as one of the types of analysis that 
accompany a proposed regulation.
    Mr. Kucinich. Well, thank you. As you know, the USDA has 
prepared a draft programmatic environmental impact statement 
pursuant to its plan to rewrite its regulations for GE 
organisms. In the future, when USDA is operating under new 
regulations, you will again face many petitions for permitting 
field trials and for the deregulation of GE crops. Does 
anything in your proposed regulations change the kinds of 
decisions that are subject to preparing an EA or an EIS?
    Ms. Smith. Does the--do our new regulation changes----
    Mr. Kucinich. Anything in your proposed regulations change 
the kinds of decisions that are subject to either an EA or an 
EIS?
    Ms. Smith. We have not finalized the regulation yet, so we 
can't speak to exactly what is in it.
    Mr. Kucinich. OK.
    Ms. Smith. But what we will have is a significant amount of 
information, a broader regulatory system, one that is based on 
tiers, a multi-tiered risk-based permitting system. And so the 
kinds of decisions, depending upon what tier you are in, will 
be what will determine--they will differ depending upon what 
the crop is that you are looking at. So if you are looking at a 
crop that has more risk, potential risk, associated with it or 
less familiarity, then in those cases, it is more likely that 
we will be conducting a higher level of analysis.
    Mr. Kucinich. You know, what we are interested in as a 
subcommittee is under what circumstances you will or would 
assert that your preparation for a programmatic EIS would 
relieve APHIS of the requirement to prepare an EA or an EIS.
    Ms. Smith. Oh, no, it would not be our intention to 
develop--make these regulation changes to do anything that 
would be contrary to CEQ regulations or our own NEPA-
implementing regulations, whether it is developing this EIS and 
regulations or others.
    Mr. Kucinich. Thank you. I would like to talk about 
isolation distances.
    Ms. Smith. OK.
    Mr. Kucinich. In connection with this, I have a letter that 
I am going to submit for the record without objection. It is a 
memorandum to USDA APHIS Regulatory Analysis and Development. 
Just for the purposes of the staff, it is dated May 31, 2005. 
Can we make sure they have a copy of that? Mr. Gregoire, would 
the staff make sure Mr. Gregoire has a copy of this so you know 
what we are putting in the record in case you have anything 
that you want to comment on it.
    Ms. Smith, as you know, Federal, State and private rice 
research programs operate a specialized nursery called the Rice 
Quarantine Nursery near Plymouth, North Carolina, where 
potentially useful traits are taken from rights germplasm from 
foreign sources. This activity is obviously sensitive. The 
germplasm in soil at the nursery could become contaminated, 
and/or an unauthorized release from the nursery could cause a 
very serious contamination of the U.S. commercial rice supply. 
For these reasons, the nursery was located 650 miles east of 
any commercially produced rice crop. The location was selected, 
in other words, to isolate the nursery spatially from 
commercial rice production to prevent contamination.
    In 2005, Ventria Bioscience applied to APHIS to field test 
genetically engineered pharmaceutical rice on a large scale in 
close proximity to the rice quarantine nursery. APHIS prepared 
an environmental assessment of the application and concluded 
there would be no significant impact and approved the 
application. Now, right here, this document that I will submit 
for the record is a memorandum protesting the deficiencies of 
the EA. It comes from a USDA research leader with the 
Agricultural Research Plant Science Research Unit. So, again, 
without objection. Specifically, this memorandum alerted APHIS 
that its EA had failed to consider the potential of, one, 
Ventria's field tests introducing pathogens that would imperil 
the Rice Quarantine Nursery; and two, Ventria's field tests 
posed a small risk that stray rice pollen could be carried by 
wind currents into the Rice Quarantine Nursery. Could you tell 
us, if you recall, how did APHIS regard the concerns raised in 
this memorandum?
    [The information referred to follows:]

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    Ms. Smith. I know we took these concerns seriously. I 
remember us talking about it within the staff. I remember one 
of our division directors talking with Mr. Marshall, contacting 
him about the situation. I can't tell you, I will have to get 
information back to you on how we resolved this issue.
    Mr. Kucinich. That would be great. I am wondering if you 
performed additional analysis in the areas identified as 
deficient. I want to know if you prepared a full blown 
environmental impact statement. I want to know what the 
evidence that APHIS took a serious look at the environmental 
economic impacts identified in the memorandum. And what I am 
actually asking for is the entire record of that communication 
to be delivered to the subcommittee so that we can see how that 
was handled. I would appreciate your cooperation on that.
    Ms. Smith. OK. Sure. I will tell you that this year we are 
in the process right now of doing an environmental assessment 
for that same crop in that same area. So we can provide you 
with that as well.
    Mr. Kucinich. That would be very helpful. And your 
cooperation is appreciated.
    Ms. Smith. Sure.
    Mr. Kucinich. As you know, APHIS considers applications to 
release pharmaceutical and industrial crops through its permit 
process. Pharmaceutical crops are genetically engineered to 
produce a drug or a component of a drug for the pharmaceutical 
industry. That review process is more rigorous than the 
notification process, reflecting the greater risk posed by 
pharmaceutical crops. What would be the likely consequences to 
farmers if a contamination event occurred involving a 
pharmaceutical crop?
    Ms. Smith. Let me tell you a little bit about, there was a 
situation that occurred previously involving a company, and our 
inspectors identified for that company that problem that 
happened. The company had three different problems that came up 
where they didn't fully comply with our requirements. And in 
each case, our inspectors were on hand to identify for the 
company that they were--they had created a problem and that 
they would have to address it. In this situation, despite the 
fact that our inspectors found the problems, told them about 
the problems--we gave them clear information on how to address 
the problems. It created a situation in which some soybeans 
were contaminated as a result. We took very quick action. We 
stopped the movement of those soybeans in place so that they 
didn't move into the food supply. But as a result, we had been 
in the process of putting together a variety of--a very good 
evaluation of how we should be regulating field testing of 
pharmaceutical and industrial types of crops. And we came out 
with both a new regulation that required our--new requirements 
to apply to all crops that contained industrial genes. And we 
also put new requirements in place that year where we 
significantly increased both our oversight as well as the 
requirements on the company. And so an example of the oversight 
we put in place for us is, while low-risk crops are--a 
percentage of low-risk crops are personally inspected by APHIS 
inspectors, these that we have less familiarity with, so they 
could potentially have more risk associated, we made a decision 
that for each of these pharmaceutical field trials that we 
would inspect seven times or more for each of these 
inspections. And the way we came up with those inspections was 
that we thought about what each of the critical control points 
or the critical decision points were in that research they were 
conducting.
    Mr. Kucinich. Is this the area--excuse me if you had 
mentioned this, because I got paged, and we have a vote come 
up.
    Ms. Smith. OK.
    Mr. Kucinich. Is this the case where APHIS had to buy about 
half a million bushels of soybeans in order to keep them from 
going to market?
    Ms. Smith. This is the case where the company didn't have 
enough assets to immediately cover the cost of the destruction 
of those soybeans. And so, in order to hold them accountable so 
that they had to pay close to $4 million in expenses to destroy 
them, we paid for the cost first, and then, as we do in our 
types of plant health situations, they entered into a contract 
with us to repay us back that money.
    Mr. Kucinich. How were they destroyed?
    Ms. Smith. How were they destroyed? Well, we took them to--
there was a local facility where they were burned in like an 
energy facility. And APHIS inspectors oversaw the whole process 
to make sure that is what happened to them. All of those 
soybeans were burned.
    Mr. Kucinich. Did anyone do an environmental report on the 
destruction of half a million bushels of pharmaceutical crops?
    Ms. Smith. I remember that we were in consultation with the 
Environmental Protection Agency, talking about what was 
acceptable from their perspective in terms of disposal.
    Mr. Kucinich. Did they give you any documentation? I mean, 
is there anything documented----
    Ms. Smith. I will have to check and see.
    Mr. Kucinich. Is there any documentation on the exchange 
between you and the EPA on the destruction of these half a 
million bushels? I would like to see that.
    Ms. Smith. All right.
    Mr. Kucinich. The committee would like that. Thank you.
    And if this is the same case, tell me. Is this the 
Inspector General found a pharmaceutical crop growing as 
volunteers in a plot of conventional soybeans, and then there 
was another State where he found that a soybean field had been 
harvested before the pharmaceutical crop volunteers had been 
removed from the field?
    Ms. Smith. This is the same case, but it wasn't the 
Inspector General that found that. Those were APHIS inspectors 
who found both of those problems and alerted the company to 
them.
    Mr. Kucinich. Staff just told me that APHIS inspectors may 
have had company on their inspection from the Inspector 
General's Office. It is not something--it is something I have 
just been told. Take it for what it is worth. It is just that 
the Inspector General apparently has had some kind of a role 
here. What would have happened, do you suppose, to the U.S. 
soybean industry if those pharmaceutical crops had been 
detected in the marketplace?
    Ms. Smith. Well, I imagine it would have been problematic, 
which is why we took such immediate action. I personally called 
the CEO of that company within minutes of us learning that they 
had harvested those and sent them on to a grain elevator. And 
that allowed us to stop them before they had a chance to move.
    Mr. Kucinich. What were those pharmaceutical crops? Do you 
remember what were they? What were they growing?
    Ms. Smith. I will have to get that back to you. I don't 
remember now what the were.
    Mr. Kucinich. I would like to see that.
    Ms. Smith. OK.
    Mr. Kucinich. And how many instances do requests to--hold 
on--how many times do you end up reviewing pharmaceutical crop 
issues? Does that happen frequently? Is this like more of a 
concern of APHIS now? Are you getting more and more 
pharmaceutical crop inquiries and you have to do more testing? 
What is happening with that?
    Ms. Smith. Actually, we could get you the numbers, but what 
happened as a result of this particular event, this technology 
was moving forward at a--it was really getting started in terms 
of moving forward, this technology of using plants to develop 
pharmaceutical or industrial proteins. As a result of the 
problem that was associated with this company, and I think as 
part of the very serious action that we took, this company 
actually eventually went out of business. And that gave, I 
think, a very clear message to the industry that this 
technology needed to be addressed very carefully. In addition, 
the requirements that we have put in place have slowed the 
technology as well, because--and what we have talked about with 
the technology providers is, this is not just your average 
biotech; this is very different. We need to have extreme 
isolations, very stringent, extreme measures in place, and they 
need to approach this very differently, even to the point of 
what kinds of farmers they offer to grow these kind of crops.
    Mr. Kucinich. I am glad to hear that you are trying to keep 
apace of this very specific technology. And what the 
subcommittee is going to do is to be working with your staff so 
that we can be able to determine who is applying for the 
permission to grow what kind of pharmaceutical crops, where 
they are being grown, what kind of permission, when the 
permission was granted, and looking at any studies that may 
exist of any complaints that may have come from farmers, you 
know, a distance to see if it is possible that--to see if the 
isolation has kept the crop intact.
    Ms. Smith. Sure.
    Mr. Kucinich. Because, you know, we are talking about 
pollination by insects, by wind, whatever. I just want you to 
know we are going to move toward that a little bit more. I want 
to thank you for your testimony. Mr. Issa has questions that he 
is submitting for the record. The subcommittee will give to you 
some followup questions. And we will be in touch on this. I 
want to thank you, Ms. Smith, for the forthcoming nature of 
your presentation. It is refreshing and much appreciated. So we 
will continue this dialog with your agency. And I want to thank 
all the members of your staff, Mr. Gregoire, for their presence 
here. We will continue our interest in this.
    And at this point, this committee stands adjourned.
    Ms. Smith. Thank you, sir.
    [The information referred to follows:]

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    [Whereupon, at 5:12 p.m., the subcommittee was adjourned.]
    [Additional information submitted for the hearing record 
follows:]

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